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Alcoa’s 3Q performance misses analysts’ expectations

This April 7, 2014, file photo shows the Alcoa logo in the lobby of the company's headquarters in Pittsburgh. Alcoa reported its financial results on Tuesday, Oct. 11, 2016.
This April 7, 2014, file photo shows the Alcoa logo in the lobby of the company's headquarters in Pittsburgh. Alcoa reported its financial results on Tuesday, Oct. 11, 2016. AP

Alcoa, which is posting its last quarterly earnings report before its split, announced a softer-than-expected third quarter, stung partly by lower alumina prices.

The company also lowered revenue forecasts for some segments of Arconic, which will become the new company.

Shares slid almost 11 percent in afternoon trading Tuesday.

Alcoa Inc. has been on a long quest to shrink its aluminum smelting business, which has been hurt by stubbornly low prices. The company is splitting that segment off and creating a new public company to make and sell specialty lightweight products for aerospace, autos and other industries. Alcoa said Tuesday the separation is set to take effect before the markets open on Nov. 1.

The Intalco aluminum smelter near Ferndale will remain under the Alcoa name.

For the period ended Sept. 30, the company earned $166 million, or 33 cents per share. A year earlier, Alcoa earned $44 million, or 6 cents per share.

Revenue dropped to $5.21 billion from $5.57 billion, as shipments of aluminum products declined. Analysts were calling for revenue of $5.33 billion, according to a FactSet survey.

Alcoa said it now foresees full-year revenue in a range of $4.8 billion to $5 billion for Global Rolled Products. That’s down from its prior guidance of $5 billion to $5.2 billion.

For Engineered Products and Solutions, Alcoa now anticipates full-year revenue between $5.6 billion and $5.8 billion. Its previous outlook was for $5.9 billion to $6.1 billion in revenue.

The company now expects $1.7 billion to $1.8 billion in revenue for the year for Transportation and Construction Solutions. It previously predicted $2.1 billion in revenue. The segments are all part of Arconic.

Shares of Alcoa fell $3.37, or 10.7 percent, to $28.14 in afternoon trading Tuesday. Its shares are down more than 8 percent over the past year.

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