Kaiser Aluminum Offers Updated Outlook On Financial Results for Fourth Quarter of 2001
HOUSTON--(BUSINESS WIRE)--Dec. 20, 2001--Kaiser Aluminum Corporation (NYSE:KLU - news) announced today that its financial results for the fourth quarter of 2001 are likely to reflect a net loss per share ranging from $.35 to $.45 (excluding unusual items) due to a variety of unfavorable operating issues. Accordingly, the company expects to report negative operating cash flow (defined as operating income plus depreciation).
The company said its updated view of the fourth quarter reflects the following:
Continuing weak demand in general for aluminum products and markedly weaker demand for aerospace products after September 11, along with unfavorable cost impacts associated with lower shipment levels;
Low average market prices for primary aluminum, partially offset by the company's hedging activities;
Slower than planned improvement in cost performance at the Gramercy, La., refinery due to startup issues. Attainment of full efficiency is expected by the end of the first quarter of 2002. Gramercy has routinely operated at above 90% of its new annual rated capacity of 1.25 million metric tonnes during the fourth quarter, although the full quarter average may be modestly below 90%.
Poor performance by the company's 49%-owned KJBC bauxite mining operation in the first two months of the fourth quarter of 2001 due to weather and other issues;
Higher maintenance costs at the company's 20%-owned QAL refinery. A major improvement in maintenance costs is not expected until mid-2002; and
Slower than expected reductions in ongoing costs at the company's curtailed aluminum smelters in the Pacific Northwest. The company expects to realize additional cost reductions beginning in the first quarter of 2002.
The company's view of financial results for the fourth quarter of 2001 reflects, among other things, current expectations regarding the timing of commodity shipments, which are subject to quarterly variation. The company indicated that the operating issues cited above may also affect financial results beyond the fourth quarter of 2001.
Kaiser Aluminum is a leading producer of alumina, primary aluminum and fabricated aluminum products. MAXXAM Inc. (AMEX:MXM - news) directly and indirectly holds approximately 62 percent of Kaiser Aluminum Corporation.
Company press releases may contain statements that constitute ``forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. The company cautions that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and that actual results may vary materially from those expressed or implied in the forward-looking statements as a result of various factors.