Alcoa Inc on Monday reported a lower quarterly net profit, as revenue was hit by falling aluminum and alumina prices and plant operations that have been curtailed, closed or sold off. Alcoa reiterated its forecast for global automotive production growth in 2016 of 1 percent to 4 percent, but said continued weakness in the North American market would offset anticipated growth in heavy-duty truck, trailer and bus production in China.
"We are continuing to perform well in a low pricing environment," Alcoa Chief Executive Officer Klaus Kleinfeld told Reuters. "Once the pricing environment comes back, and it's hard to determine when, you'll see our performance going up."
The New York-based company reported second-quarter net income of $135 million or 9 cents per share, down from $140 million or 10 cents per share a year earlier.
Analysts had on average expected earnings per share of 9 cents.
The company said that excluding one-time items, it reported earnings per share of 15 cents.
Alcoa is due to split in two in the second half of this year. It will spin off its traditional smelting operations under the Alcoa name while its value-added business focused predominantly on the aerospace and automotive industries will operate under the name Arconic.
The company said its expects global large commercial aircraft deliveries to increase 6 percent in the second half of 2016 from the first six months.
Alcoa faces a challenging market as aluminum prices have hovered around historic lows. Many producers have accused China of selling metal below market rates into oversupplied global markets. China has denied this, saying excess capacity is a global issue.
As part of its plans to restructure its traditional aluminum and alumina business, Alcoa has curtailed, shuttered or sold off 40 percent of its smelting capacity.