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Alcoa’s profit decreased only with 21%

The largest U.S. aluminum producer Alcoa reported third-quarter profit that topped forecasts of financial analysts, thanks to increased demand for aluminum in the second-largest economy in the world - China. The company's management predicts that the turbulent growth of the Chinese economy may increase demand for aluminum in the world by 13% this year. Her previous demand forecasts predicting growth of 12 per cent. The company, which participates in the index Dow Jones IA, announced after yesterday's session net earnings per share from 9 cents last quarter, which was nearly twice the expectations of economists polled by Bloomberg. This excludes one-off effects on financial results. Because of its better-than-expected reports on Alcoa shares rise in price by 2.7 percent to 12.54 dollars in electronic trading today on the New York Petroleum Exchange. Alcoa net profit decreased by 21% yoy to 61 million dollars, or 6 cents a share, in the third quarter compared to 77 million dollars, or 8 cents a share, a year ago. Sales increased by 15% yoy to 5.3 billion dollars during the period. Alcoa has supplied 1.22 million tons of aluminum, which is 0.6 percent less than the third quarter of 2009. The company got very good mortgage discount to invest into the new factories in Asia, which was the main reason for the bad financial report. The remortgage rate was quite high, so the business management of the company got new loan fro covering the expenses for this large investment.
The reduction in net profit of the company is partly due to depreciation of the dollar, which increases the cost of Alcoa in its foreign factories.