Alcoa Corp

Alcoa made progress in 2022 with strategic capacity restarts and efforts to lessen the effects of high energy prices. Despite this, it was a difficult year. Global events impacted the price of energy and raw commodities. The company’s last quarter was also bad as it reported wider than expected losses but managed to surpass the revenue expectations of Wall Street. The management remains focused on decreasing complexity and maintaining their improvement measures, as their markets had considerable price variations between the first and the second half of the year. The company successfully finished the safe restart of its Portland Aluminum Joint Venture smelter in the Australian state of Victoria. It also kept moving forward with restarting the Alumar smelter in Brazil. During the quarter, it also launched a new processing facility in Brazil that uses the water and land conservation strategies it learned during its operations in Australia. Furthermore, the company intends to combine its Bauxite and Alumina segments starting in January 2023. A partial shutdown of the San Ciprián refinery and lower-than-expected bauxite quality at the Australian refineries will result in decreased refinery production in 2023, resulting in alumina shipments between 12.7 million and 12.9 million metric tons. We remain optimistic about Alcoa’s growth strategy and give them a ‘Hold’ rating.