Alcoa Earns $1.23 a Share, Beating Estimates

Aluminum Co. of America said its third-quarter operating profit rose a better-than-expected 3.4% to $220.4 million, or $1.23 a diluted share, from a year ago, as cost-cutting offset lower metals prices. Sales rose 22% to $4.11 billion. The Pittsburgh-based natural-resources giant was expected to earn $1.06 a share, based on the average of estimates compiled by First Call Corp. The results for both periods exclude special items to adjust for the value of its aluminum contracts. Alcoa has targeted $1.1 billion in savings through 2000 and expects much of it to come from efficiencies created by its July purchase of Alumax Inc. So far, earnings haven’t been hurt much by reduced demand in Asia, a spokeswoman said. The region accounts for 8% of Alcoa’s revenue. Alcoa shares rose $4.31 to close at $72.50 on the NYSE.