Kaiser Aluminum Q3 Profit Down - Update

(RTTNews) - Kaiser Aluminum Corp. (KALU) Monday reported a drop in profit for the third quarter, hurt largely by higher operating costs despite increased revenue. Earnings for the quarter fell short of analysts estimates, as did revenues, sending shares of the aluminum products maker down seven percent in the after-hours trade.

Foothill Ranch, California-based Kaiser Aluminum's third-quarter profit dropped to $15.9 million or $0.85 per share from $25.4 million or $1.34 per share last year.

Excluding special items, adjusted earnings declined to $14.6 million or $0.79 per share from $17.1 million or $0.90 per share last year. On average, eight analysts polled by Thomson Reuters expected earnings of $1.02 per share for the quarter. Analysts' estimates typically exclude special items.

Kaiser's sales for the third quarter grew to $338.9 million from $319.9 million last year, but still short of analysts' consensus estimate of $341.34 million.

Total costs and expenses for the quarter rose to $306.3 million from $278.3 million last year.

"Third quarter 2014 reflected two unanticipated challenges at our Spokane (Trentwood), Washington facility that caused our results to fall short of our expectation for shipments and adjusted EBITDA," said Jack Hockema, President, CEO and Chairman.

The company said it made process refinements to improve quality of KaiserSelect aerospace plate products which resulted in higher internal scrap and remakes of plate. Kaiser also experienced unplanned downtime in aerospace sheet processing operations that hampered production and shipments during the quarter.

KALU closed Monday's trading at $75.14, up $0.26 or 0.35%, on the Nasdaq. The stock, however, slipped $5.14 or 6.84% in the after-hours trade.