CHICAGO Noranda Aluminum Holding Corp.s earnings
plummeted in the first quarter amid lower aluminum prices on
the London Metal Exchange, higher energy costs and lower
However, the Franklin, Tenn.-based aluminum producer remains
optimistic about the rest of 2013 despite grappling with
liquidity issues, the company said April 24 in commentary
released with earnings data.
We are evaluating and taking appropriate actions to
manage our liquidity position and provide for prudent
investment in long-term growth, Noranda president and
chief executive officer Layle K. (Kip) Smith said in a
Noranda continues to hold a positive outlook thanks to its debt
maturity profile, reliable operations, an outlook for stable
demand and the prospects for further modest improvement in the
U.S. economy, Smith said. We are encouraged by our
opportunities for 2013, and our capability to pursue them,
despite the recent decline in LME prices, he said.
Noranda reported first-quarter net income of $600,000 for the
three months ended March 31, a 96.3-percent drop from
year-earlier net income of $16.2 million, on sales that slipped
4.3 percent to $338.4 million from $353.5 million.
The company said it had $16.1 million in cash and cash
equivalents and available borrowing capacity of $142.7 million
as of March 31, 2013.
Profits were hurt by higher electricity costs in the
companys primary aluminum segment, largely due to a
6.6-percent rate increase that became effective in February,
and higher natural gas prices.
Meanwhile, higher value-added premiums in the primary aluminum
and flat-rolled segments were offset by lower average realized
Midwest transaction prices in the primary aluminum segment, the
Lower production volumes in the alumina segment also impacted
results, Noranda said. The company noted that the
segments sales fell as more of the companys alumina
production was used by its primary aluminum segment to restock
supplies following output issues in the alumina segment during
the third and fourth quarters of 2012.