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06 NOVEMBER 2019 AL CIRCLE

Arconic sees a marginal year-on-year revenue rise in Q3 2019 amidst lower net income

EDITED BY : DEBANJALI SENGUPTA 2MINS READ

Arconic, in the third quarter results, revealed that its revenue grew 1 per cent year-on-year to stand at $3.6 billion, while the net income dropped from $161 million, or $0.32 per share, in the third quarter of 2018 to $95 million, or $0.21 per share in Q3 2019.

Arconic's revenue rises 1% YoY

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The operating income also inched down from $345 million in Q3 2018 to $326 million in Q3 2019. Operating income excluding special items was $475 million, up 36% year over year, due to favourable product pricing, higher volume, favourable aluminium prices, and net cost reductions more than offset operational challenges in the aluminium extrusions business and unfavourable product mix. Cash balance, as of the third quarter of the year, was at $1.3 billion, according to the company’s report.

Arconic Chairman and Chief Executive Officer John Plant said, “In the third quarter 2019, the Arconic team delivered improved quarterly revenue, adjusted operating income, adjusted operating income margin, adjusted free cash flow and adjusted earnings per share on a year-over-year basis. Arconic’s third quarter 2019 return on net assets improved by 550 basis points year over year. We expect this positive year-over-year trend to continue in the fourth quarter. Based on our performance through the first nine months of 2019 and our outlook for the remainder of 2019, we are increasing our, guidance for the third time in 2019.”

Aluminium foil report

According to the company's revised guidance for the year, revenue in the whole year of 2019 is estimated to be at $14.15-$14.35 billion, down from the previous estimation of $14.3- $14.6 billion. EBITDA Excluding Special Items is estimated to narrow to high end of range at $2.30-$2.35 billion, versus the prior estimation of $2.25-$2.35 billion. Earnings per share, on the other hand, are likely to grow to $2.07-$2.11, versus $1.95-$2.05; while Adjusted Free Cash Flow to remain unchanged at $700-$800 million.

Arconic’s Engineered Products and Forgings (EP&F) also reported an increase in revenue by 7 per cent year-on-year to $1.8 billion, but its global rolled products (GRP) saw a decline of 4 per cent YoY to $1.8 billion. The operating profit margin of EP&F was 20.2 per cent, up 330 basis points year over year, while that of the GRP was 9.1 per cent, up 330 basis points year over year.


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EDITED BY : DEBANJALI SENGUPTA 2MINS READ

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