Kaiser sees income boost from Gramercy unit
NEW YORK, May 24 (Reuters) - As part of a performance improvement initiative designed to increase operating cash flow at Kaiser Aluminum Corp. (NYSE:KLU), the company said efficiencies at the Gramercy, Louisiana alumina refinery should amount to an annual operating income benefit of between $5 million and $10 million.
This would be incremental to the $50 million to $75 million of Gramercy-related improvements in operating income that is already incorporated into the company's adjusted first-quarter 2001 annual earnings before income tax, debt, and amortization (EBITDA) run rate of $135 million, said Kaiser in a press release.
The $5 million to $10 million in anticipated income benefit is over and above the previously announced $50 million to $75 million associated with the Gramercy project and getting it up to the run rate, said Kaiser spokesman Scott Lamb.
An explosion at Gramercy in 1999 had knocked 1 million tonnes of alumina supply out of the market. Kaiser partially restarted the plant in mid-fourth quarter of 2000.
Gramercy current operates at around 75 percent of its 1.25 million-tonne annual capacity rate, said Lamb.
``We have said completion of the project will be third quarter. We should ramp up to 100 percent reasonably soon after that. If Gramercy is not already at full capacity by the end of the year, we ought to be getting very close to full capacity by then,'' said Lamb.
``I would say that is the message that we have been delivering about Gramercy for several months now,'' he added.