Alcoa(US:AA)2026-01-22 21:13Financial Performance - Revenue for Q4 2025 increased to $3.4 billion, a 15% sequential increase, and full year revenue reached $12.8 billion, an 8% increase year-over-year [5][8]. - Net income for Q4 2025 was $226 million, or $0.85 per share, compared to $1.2 billion, or $4.42 per share for the full year 2025, up from $60 million in FY24 [3][8]. - Adjusted net income for Q4 2025 was $335 million, or $1.26 per share, with full year adjusted net income at $1.0 billion, or $3.77 per share [3][8]. - Adjusted EBITDA excluding special items for Q4 2025 was $546 million, a sequential increase of $276 million, while full year adjusted EBITDA reached $2.0 billion, a 25% increase year-over-year [3][8]. - For the quarter ended December 31, 2025, Alcoa reported sales of $3,449 million, an increase from $2,995 million in the previous quarter [25]. - The net income attributable to Alcoa Corporation for the quarter was $226 million, compared to $232 million in the prior quarter [25]. - For the year ended December 31, 2025, total sales reached $12,831 million, up from $11,895 million in 2024, representing a growth of approximately 7.9% [26]. - Alcoa Corporation reported a net income of $1,132 million for the year ended December 31, 2025, a significant increase from $24 million in 2024 [28]. - Cash provided from operations increased to $1,185 million in 2025, compared to $622 million in 2024, reflecting improved operational efficiency [28]. - Total segment adjusted EBITDA for 2025 was $1,959 million, up from $910 million in 2024, indicating strong performance across segments [29]. - For the year ended December 31, 2025, Alcoa reported a net income of $1,170 million, a significant increase from $60 million in 2024 [34]. Production and Operations - Alumina production for Q4 2025 increased 1% sequentially to 2.48 million metric tons, while aluminum production increased 4% to 604,000 metric tons [7]. - The company expects 2026 alumina production to range between 9.7 and 9.9 million metric tons, and aluminum production to range between 2.4 and 2.6 million metric tons [12][13]. - Aluminum production for 2025 reached 2,319 kmt, while total aluminum shipments were 2,522 kmt, showing a robust output [29]. - Third-party alumina shipments totaled 8,829 kmt in 2025, a decrease from 9,005 kmt in 2024, suggesting a need for market adjustment [29]. Financial Position - Total assets increased to $16,212 million as of December 31, 2025, compared to $14,064 million a year earlier, reflecting a growth of approximately 15.3% [27]. - Current liabilities rose to $3,765 million in 2025 from $3,395 million in 2024, indicating an increase of about 10.9% [27]. - Alcoa's total equity increased to $6,133 million in 2025 from $5,157 million in 2024, representing a growth of about 18.9% [27]. - The total debt as of December 31, 2025, was $2,448 million, down from $2,595 million as of December 31, 2024, while net debt decreased to $851 million from $1,457 million [43]. - Alcoa's adjusted net debt as of December 31, 2025, was $1,462 million, down from $2,057 million as of December 31, 2024 [43]. Cash Flow and Investments - Cash from operations for Q4 2025 was $537 million, with a full year total of $1.2 billion, and free cash flow for the year was $567 million [5][8]. - Capital expenditures for 2025 were $618 million, slightly higher than $580 million in 2024, indicating ongoing investment in growth [28]. - The company experienced a net change in cash and cash equivalents of $458 million in 2025, up from $187 million in 2024, enhancing liquidity [28]. Market and Pricing - The average realized third-party price per metric ton of aluminum increased to $3,376 in 2025, compared to $3,006 in 2024, reflecting favorable market conditions [29]. - The average realized third-party price per metric ton of alumina was $415 in 2025, down from $636 in 2024, indicating pricing pressures in the alumina market [29]. Restructuring and Charges - The company incurred a goodwill impairment of $144 million in 2025, while there was no such impairment in 2024 [26]. - Restructuring and other charges increased to $918 million in 2025 from $341 million in 2024, reflecting strategic changes within the company [28]. - The company incurred restructuring and other charges of $14 million in the quarter ended December 31, 2025, compared to $885 million in the previous quarter [40]. Working Capital Management - DWC working capital for Q4 2025 is $1,303 million, an increase from $1,289 million in Q4 2024 [45]. - Days working capital improved to 35 days in Q4 2025, down from 50 days in Q3 2025 [45]. - Receivables from customers increased to $1,064 million in Q4 2025, up from $1,096 million in Q4 2024 [45]. - Inventories decreased slightly to $2,177 million in Q4 2025 from $1,998 million in Q4 2024 [45]. - Accounts payable, trade rose to $1,938 million in Q4 2025, compared to $1,805 million in Q4 2024 [45]. - Management emphasizes the importance of DWC working capital as a measure of liquidity management efficiency [46].