Alcoa Reaches Agreement with New York State to Increase Competitiveness of Massena West Smelter
November 24 2015 - 10:06AM
Business Wire
Company continues to strengthen Upstream and
improve cost position
Lightweight metals leader Alcoa (NYSE:AA) today announced that
it has entered into a three-and-a-half year agreement with New York
State to increase the competitiveness of the Massena West smelter.
The Company had previously announced plans to curtail the facility
amid prevailing market conditions. The agreement will help maintain
hundreds of jobs in New York’s North Country, improve the cost
position of the smelter and support growth projects for the
casthouse.
“Senator Schumer and Governor Cuomo have been tremendous allies
for Alcoa’s Massena operations for many years and we thank them for
their continued support,” said Chairman and Chief Executive Officer
Klaus Kleinfeld. “Today’s agreement helps better position the
smelter in light of prevailing market conditions, providing this
facility a bridge to a stronger commodity market and maintaining
jobs in the North Country. We remain focused on ensuring our
Upstream business is well-positioned to succeed throughout the
cycle.”
New York State’s incentive package will help maintain
approximately 600 jobs at the Massena West facility through the
term of the agreement. The plant has 130,000 metric tons of
smelting capacity.
With the Midwest transaction aluminum price down 30 percent
year-to-date, Alcoa will continue with its other previously
announced curtailments of uncompetitive smelting and refining
capacity. Once the curtailments are complete, Alcoa’s smelting
capacity will be reduced by 373,000 metric tons. The reductions
will further improve the cost position of the Upstream business and
ensure competitiveness in a lower pricing environment.
Alcoa has been aggressively reshaping its Upstream portfolio as
part of a successful multi-year strategy to position itself as a
low-cost global leader in alumina and aluminum production. The
Company is on track to meet its 38th percentile target on the
global aluminum cash cost curve in 2016.
Revised total restructuring-related charges in the fourth
quarter of 2015 associated with actions announced in November will
be between $130 million and $150 million after-tax, or $0.10 to
$0.11 per share, of which approximately 40 percent would be
non-cash.
About Alcoa
A global leader in lightweight metals technology, engineering
and manufacturing, Alcoa innovates multi-material solutions that
advance our world. Our technologies enhance transportation, from
automotive and commercial transport to air and space travel, and
improve industrial and consumer electronics products. We enable
smart buildings, sustainable food and beverage packaging, high
performance defense vehicles across air, land and sea, deeper oil
and gas drilling and more efficient power generation. We pioneered
the aluminum industry over 125 years ago, and today, our more than
60,000 people in 30 countries deliver value-add products made of
titanium, nickel and aluminum, and produce best-in-class bauxite,
alumina and primary aluminum products. For more information,
visit www.alcoa.com, follow @Alcoa on Twitter at
www.twitter.com/Alcoa and follow us on Facebook at
www.facebook.com/Alcoa.
Forward-Looking Statements
This release contains statements that relate to future events
and expectations and as such constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements include those containing such
words as “estimates,” “expects,” “goal,” “plans,” “should,”
“target,” “will,” “would,” or other words of similar meaning. All
statements that reflect Alcoa’s expectations, assumptions or
projections about the future, other than statements of historical
fact, are forward-looking statements, including, without
limitation, statements regarding Alcoa’s goal to create a globally
competitive Upstream business and the expected financial impact of
the curtailments. Forward-looking statements are subject to risks,
uncertainties and other factors, and are not guarantees of future
performance. Important factors that could cause actual results to
differ materially from those expressed or implied in the
forward-looking statements include: (a) material adverse changes in
aluminum industry conditions, including global supply and demand
conditions and fluctuations in London Metal Exchange-based prices
and premiums, as applicable, for primary aluminum, alumina, and
other products, and fluctuations in indexed-based and spot prices
for alumina; (b) Alcoa’s inability to successfully realize goals
established in each of its business segments, at the levels or by
the dates targeted for such goals (including moving its alumina
refining and aluminum smelting businesses down on the industry cost
curves and increasing revenues and improving margins in its Global
Rolled Products, Engineered Products and Solutions, and
Transportation and Construction Solutions segments); (c) Alcoa’s
inability to realize expected benefits, in each case as planned and
by targeted completion dates, from acquisitions, divestitures,
facility closures, curtailments, or expansions, or international
joint ventures; (d) political, economic, and regulatory risks in
the countries in which Alcoa operates, including unfavorable
changes in laws and governmental policies, tax rates, civil unrest,
or other events beyond Alcoa’s control; (e) changes in preliminary
accounting estimates due to the significant judgments and
assumptions required; (f) the outcome of contingencies, including
legal proceedings and environmental remediation; and (g) the other
risk factors summarized in Alcoa’s Form 10-K for the year ended
December 31, 2014, and other reports filed with the Securities and
Exchange Commission. Alcoa disclaims any obligation to update
publicly any forward-looking statements, whether in response to new
information, future events or otherwise, except as required by
applicable law.
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version on businesswire.com: http://www.businesswire.com/news/home/20151124005743/en/
AlcoaInvestorsNahla Azmy,
212-836-2674Nahla.Azmy@alcoa.comorMediaSonya Elam Harden,
864-357-1258Sonya.Harden@alcoa.comorMonica Orbe,
212-836-2632Monica.Orbe@alcoa.com
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