Alcoa Inc. (AA) said it plans to cut alumina production by about 390,000 metric tons a year, in an effort to align output with its plans to reduce smelter capacity by 12% in the first half of this year amid high costs and slumping prices.
The latest cutbacks come less than a week before Alcoa, an industrial bellwether that unofficially kicks off the U.S. earnings season, releases its first-quarter results on Tuesday after the bell.
The aluminum producer on Thursday said the move will reduce its capacity in the Atlantic region by about 4%. The region, where it aims to avoid adding to an oversupply, accounts for about half of the company's refining capacity of about 18 million metric tons a year.
Alcoa in January reported that swung to a fourth-quarter loss amid slumping prices and rising costs.
The company's profit had been surging in previous quarters thanks to demand from automobile and aerospace companies and emerging markets like China, but third-quarter results disappointed as demand weakened in areas like Europe, aluminum prices continued to fall and raw-materials costs climbed.
Shares were down 4 cents at $9.77 in premarket trading. Through Wednesday's close, the stock is down 46% in the past year.
-By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes@dowjones.com