NEW YORK Noranda Aluminum
Holding Corp.s third-quarter 2012 net income plummeted
87.6 percent from the year-ago quarter as the price of aluminum
on the London Metal Exchange declined and shipments were
disrupted due to Hurricane Isaac earlier this summer.
Noranda reported net income of
$3.8 million in the three months ended Sept. 30, down from
$30.8 million in the same period last year, marking an
85-percent plunge from $25.3 million in the second quarter of
third-quarter 2012 results reflect LME levels, which reached
near historical lows during the quarter, and we are prudently
managing our balance sheet and cost structure through the
current LME environment," Noranda president and chief executive
officer Layle "Kip" Smith said in a statement.
Although three-month aluminum experienced an uptick in the
third quarter, rising 12 percent to $2,126 per tonne on Sept.
28 from $1,902 per tonne on July 2, it bottomed out on Aug. 16
at $1,831 per tonne, hitting many primary producers
third-quarter earnings hard.
"Persistent global macroeconomic
concerns, particularly the European sovereign-debt crisis and
fears of slowing economic growth in China, have dampened LME
prices since the second half of 2011," Noranda said.
"Substantially all of the companys external revenues are
linked to the LME price, which averaged 87 cents per pound in
the third quarter, compared to $1.09 per pound in the third
quarter (of) 2011."
In addition to low LME prices,
Hurricane Isaac, which hit Norandas Gramercy, La.,
alumina refinery on Aug. 29, also hurt earnings, having a
$5.9-million negative impact on the segments profit due
to lost contribution margins, losses on replacement alumina,
and production inefficiencies incurred as the refinery operated
at below normal levels.
sales totaled $336.8 million, down 15.9 percent from $400.4
million in the third quarter last year and down 9.4 percent
from $371.7 million in the second quarter of this year.
The company shipped 97.6 million
pounds of flat-rolled products to third parties in the quarter,
up slightly from 94.9 million pounds in the year-ago
Primary aluminum third-party
shipments dipped to 120 million pounds in the third quarter
from 123.8 million pounds in the same quarter last year.