Alcoa 2Q13 Earnings Call Notes

posted in: Notes | 0

This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. The quotes are generally pieces of information that I find interesting or helpful to understanding the company, industry or economy and are not meant to provide summaries of the full content of the call. Other posts in this series can be found by clicking here. Full transcripts can be found at Seeking Alpha.

“we confirm our expectations that we are going to see a 9% to 10% global growth for this year in the aerospace market. Over 900 orders and commitments were signed at the Paris Air Show. I will talk more about it a little later. Value of that $335 billion. The backlog for Airbus and Boeing now makes up 9,900 planes and that equals eight years of production.”

“In, Automotive, let us start with the U.S. We are upwardly revising our production forecast to plus 2% to 5% from 0% to 4% that we had there before.”

“Automotive Europe, a different picture, we moved our forecast to 2.5% decline despite positive April numbers, but when May came in this was we wiped out because it was the worse May in 20 years.”

“China, Automotive, we keep our forecast of 7% to 10% growth. ”

“Inventories have decreased to 49,700 thousand trucks that’s a reduction of 24%, and that’s a really critical point. They are still higher than historic. The historic norm is around 42,000 trucks. The production therefore is up in the second quarter versus the fourth quarter 22%, but still down from the year-on-year comparison roughly 14%, so we expect the production to trend up and this is also supported by the fundamentals in the North American truck business 4.6% year-on-year, freight ton miles up 2.1%, prices up, industry profitability is expected to be up 0.6%. And also, here the average age of the fleet is 6.7 years now 20 year average of 5.8 years. So, good news in terms all of pent-up demand coming to realization at one point in time.”

“beverage can packaging. We reduced our projection of global growth to 1% to 2%. Before we had 2% to 3%. As North America struggled through May”

“In Europe, we have seen that gas-fired power generation is getting squeezed by lower priced coal and by subsidized renewables. In the U.S., we see a little bit of a different picture. The natural gas prices have climbed. So coal has been able to claw back some of the market share that gas had been winning before. ”

“we do see that our projection of an 11% demand growth for aluminum in China is really confirmed…So, demand continues to be strong…China for us in the aluminum industry is living on a different universe…and they rarely communicate, right? Because, they are high cost and they are not going to export and that’s extremely important…I believe that we will continue to see the Chinese aluminum industry to restructure. We currently believe 41% of all of the smelters are under water…I am pretty confident that we will continue to see restructuring going on and probably in an accelerated fashion under the new leadership.”