Alcoa Sees $60M Alumina Hit, Cuts 120k Ton Shipments in Q2 Outlook
AA•Alcoa expects a $60 million Q2 hit in Alumina from $30 million of added Pinjarra costs, $20 million of energy expenses and $10 million of bauxite pricing declines. It cut third-party alumina shipments by 120,000 metric tons and revised Q2 EBITDA down by over $45 million.
1. Alumina Segment Challenges
Alcoa’s Alumina segment faces a roughly $60 million Q2 earnings impact driven by $30 million in elevated production costs at the Pinjarra refinery, $20 million in increased energy expenses and $10 million from softer bauxite pricing and volumes. The company now forecasts third-party alumina shipments to fall by 120,000 metric tons.
2. Aluminum Segment Outlook
The Aluminum segment remains poised for a favorable swing of about $55 million year-over-year, supported by inventory repositioning, higher premiums and shipment volumes, plus lower operating costs as the San Ciprián smelter restart completes.
3. Tariff and Currency Effects
Section 232 tariff costs on U.S. aluminum imports are slated to rise by approximately $35 million, while foreign exchange impacts are expected to yield around $30 million in benefits against a sequential $15 million increase in depreciation expense.
