Alcoa's Q4 revenue declined by 3% YoY, and adjusted EBITDA fell short of expectations.

Zhitong App learned that after the US stock market closed on Wednesday, Alcoa announced its financial performance for the fourth quarter and full year of 2023. The data showed that the company's Q4 revenue was $2.595 billion, in line with market expectations, a decrease of about 3% from the same period last year's $2.663 billion; the net loss attributable to the company was $150 million, compared to a loss of $395,000 in the same period last year; the loss per share attributable to the company was $0.84, compared to $0.94 in the same period last year, and the adjusted loss per share was $0.56, while analysts expected $0.84.

In the fourth quarter, the company's adjusted EBITDA was $89 million, higher than the $29 million in the same period last year, but lower than the analysts' expectation of $110.7 million. The adjusted EBITDA for the aluminum business was $88 million, compared to $31 million in the same period last year, but lower than the analysts' expectation of $97.8 million.

Due to the decline in production at the Australian refinery, the quarterly alumina production decreased by 1% MoM to 2.79 million tons. Aluminum production was 541,000 tons, an increase of 2% from the strong production in the third quarter, a YoY increase of 4.8%, higher than the expected 537,183 tons.

In terms of shipments, third-party alumina shipments decreased by 5% MoM, mainly due to a decrease in trading volume. Aluminum shipments increased by 1% MoM.

In terms of full-year performance, Alcoa's revenue for the US aluminum business was $10.551 billion, a YoY decrease of 15%; the net loss attributable to the company was $651 million, compared to a loss of $12,300 in the same period last year; the loss per share attributable to the company was $3.65, compared to $0.68 in the same period last year.

Looking ahead, Alcoa expects alumina production to be between 9.8 million tons and 10 million tons in 2024, and alumina shipments to be between 12.7 million tons and 12.9 million tons. Due to the restart of smelters, the aluminum division is expected to produce 2.2 million to 2.3 million tons, an increase from 2023. Aluminum shipments are expected to be between 2.5 million and 2.6 million tons, consistent with 2023.

Due to increased maintenance costs and reduced shipments from Australia, the adjusted EBITDA for the alumina division in the first quarter of 2024 is expected to face a negative impact of approximately $15 million. In addition, any advantages brought by the decrease in raw material and energy costs are expected to be completely offset by other factors during this period.

In the adjusted EBITDA for the aluminum division in the first quarter of 2024, the company expects that the favorable energy costs resulting from the price decrease in Brazil and Norway will be completely offset by the lower product premiums and the absence of adverse net impacts related to the IRA 45X credit and Norwegian CO2 compensation changes in the fourth quarter of 2023. The alumina cost for the aluminum division is expected to decrease by $5 million MoM. In addition, the company expects that the hedging plan for the aluminum smelter restart ending in December 2023 will have a negative impact of approximately $20 million MoM. After the release of the earnings report, as of the time of writing, the stock has fallen nearly 3% in after-hours trading.