Summary
Howmet Aerospace Inc. (HWM), formerly Alcoa Inc., reported a net loss of $2 million for the second quarter of 2012, a significant decrease from a net income of $322 million in the same period of the prior year. This downturn was primarily driven by lower realized prices for aluminum and alumina, coupled with increased input costs and charges related to litigation and environmental remediation. Sales also declined year-over-year, impacted by lower commodity prices and unfavorable foreign currency movements. The company's balance sheet shows total assets of $39.5 billion and total liabilities of $22.6 billion as of June 30, 2012. Cash and cash equivalents stood at $1.7 billion, down from $1.9 billion at the end of 2011. Cash flow from operations for the first six months of 2012 was $301 million, a decrease from $562 million in the prior year, largely due to lower operating results and increased pension contributions.
Financial Highlights
54 data points| Revenue | $5.96B |
| Cost of Revenue | $5.15B |
| Gross Profit | $809.00M |
| R&D Expenses | $47.00M |
| SG&A Expenses | $245.00M |
| Operating Expenses | $5.97B |
| Operating Income | -$2.00M |
| Interest Expense | $123.00M |
| Net Income | -$2.00M |
| EPS (Diluted) | $-0.01 |
| Shares Outstanding (Basic) | 1.07B |
| Shares Outstanding (Diluted) | 1.07B |
Key Highlights
- 1Howmet Aerospace (Alcoa) reported a net loss of $2 million for Q2 2012, a significant decline from a $322 million profit in Q2 2011.
- 2Sales decreased by 9% year-over-year for the quarter, reaching $5.96 billion, primarily due to lower aluminum and alumina prices.
- 3Cost of goods sold as a percentage of sales increased from 79.7% in Q2 2011 to 86.4% in Q2 2012, indicating pressure on margins.
- 4The company recorded restructuring and other charges of $15 million in the quarter, primarily related to employee layoffs and lease termination costs.
- 5A significant legal charge of $45 million was recorded for a proposed settlement in the Aluminium Bahrain (Alba) lawsuit, with an additional reasonably possible charge of up to $75 million.
- 6Cash provided from operations for the first six months of 2012 decreased to $301 million from $562 million in the prior year.
- 7The company's long-term debt remained substantial at approximately $8.55 billion as of June 30, 2012, although short-term borrowings increased significantly.