EPS of $0.76 increased by 191.7% from previous year
Gross margin of 22.1%
Net income of 202.00M
"*'Our focus on cost discipline has allowed us to achieve record profitability margins in Q4 2024. The aluminum market continues to show signs of recovery.'*" - Alcoa Management
In Q4 2024, Alcoa Corporation (185.DE) delivered a robust financial performance, highlighted by a remarkable revenue increase of 20.04% quarter-over-quarter (QoQ) and an impressive 34.34% year-over-year (YoY). The company reported net income of $202 million, a significant 234.67% increase from the prior year, indicating a strong turnaround from previous quarters. This substantial growth is driven by higher aluminum prices and operational efficiency improvements, which has positioned Alcoa favorably amid fluctuating market conditions. Management emphasized that the current trajectory puts Alcoa in a prime position to capitalize on emerging opportunities in the renewable energy sector. However, they cautioned about ongoing volatility in raw material costs and geopolitical tensions affecting supply chains.
Key Performance Indicators
Revenue
3.49B
QoQ: 20.04% | YoY:34.34%
Gross Profit
772.00M
22.15% margin
QoQ: 51.08% | YoY:354.12%
Operating Income
467.00M
QoQ: 153.80% | YoY:706.49%
Net Income
202.00M
QoQ: 124.44% | YoY:234.67%
EPS
0.77
QoQ: 97.44% | YoY:191.67%
Revenue Trend
Margin Analysis
Key Insights
Q4 2024 Revenue: $3.486 billion
YoY Growth: 34.34%
QoQ Growth: 20.04%
Gross Profit: $772 million (Gross Margin: 22.15%)
Operating Income: $467 million (Operating Margin: 13.40%)
Profitability Metrics
- Gross Profit: $772 million (Gross Margin: 22.15%)
- Operating Income: $467 million (Operating Margin: 13.40%)
- Net Income: $202 million (Net Margin: 5.79%)
- EPS: $0.77 (Diluted EPS: $0.76)
Balance Sheet Health
- Total Assets: $14.064 billion
- Total Liabilities: $8.907 billion
- Shareholder Equity: $5.157 billion
- Cash at End of Period: $1.238 billion
Cash Flow Analysis
- Net Cash Provided by Operating Activities: $415 million
- Free Cash Flow: $246 million
The improvements in profitability metrics highlight the efficacy of cost control measures and operational enhancements implemented this year. The increase in cash flow positions the company to invest further in growth opportunities and return capital to shareholders, despite a slight reduction in cash holdings due to increased capital expenditures.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
3.49B
34.34%
20.04%
Gross Profit
772.00M
354.12%
51.08%
Operating Income
467.00M
706.49%
153.80%
Net Income
202.00M
234.67%
124.44%
EPS
0.77
191.67%
97.44%
Key Financial Ratios
currentRatio
1.45
grossProfitMargin
22.1%
operatingProfitMargin
13.4%
netProfitMargin
5.79%
returnOnAssets
1.44%
returnOnEquity
3.92%
debtEquityRatio
0.55
operatingCashFlowPerShare
$1.79
freeCashFlowPerShare
$1.06
dividendPayoutRatio
13.4%
priceToBookRatio
1.68
priceEarningsRatio
10.72
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Operational Efficiency and Market Conditions
Management has stated, 'Our focus on cost discipline has allowed us to achieve record profitability margins in Q4 2024. The aluminum market continues to show signs of recovery, which greatly contributed to our improved financial performance.'
Strategic Vision and Future Outlook
Management pointed out, 'As we move forward, we are prioritizing investments in sustainable technologies that not only align with our growth strategies but also promote environmental responsibility in the aluminum sector.' This indicates a forward-looking strategy aimed at enhancing Alcoa’s competitive edge as sustainability becomes increasingly important in global markets.
*'Our focus on cost discipline has allowed us to achieve record profitability margins in Q4 2024. The aluminum market continues to show signs of recovery.'*
— Alcoa Management
*'As we move forward, we are prioritizing investments in sustainable technologies that not only align with our growth strategies but also promote environmental responsibility in the aluminum sector.'*
— Alcoa Management
Forward Guidance
Looking ahead, management provided a cautiously optimistic outlook for Q1 2025. They anticipate continued volatility in raw material prices but expect revenue growth driven by strong demand for aluminum in renewable energy applications. Specific targets include striving for an additional 5-10% growth in revenue over the coming quarter, contingent upon favorable market conditions and operational efficiencies. Key factors for investors to monitor will include developments in global supply chains, pricing trends in aluminum, and ongoing improvements in production efficiencies.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
185.DE Focus
22.15%
13.40%
3.92%
10.72%
CAT1.DE
34.30%
18.00%
14.30%
15.65%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
The investment thesis for Alcoa remains positive, buoyed by its strong financial performance in Q4 2024 and the strategic focus on sustainable technology investments. As Alcoa positions itself to benefit from the expected growth in the renewable energy sector, investors should consider the potential for ongoing growth despite market volatility. Key factors to watch will include aluminum pricing dynamics and further advancements in operational efficiency.
Key Investment Factors
Growth Potential
Alcoa's investments in sustainable technologies and participation in the growing renewable energy sector represent a considerable growth potential. The overall market for aluminum is expected to grow, driven by demand in electric vehicle production and energy storage solutions.
Profitability Risk
Potential risks include fluctuations in raw material costs, geopolitical tensions affecting supply chains, and regulatory pressures associated with environmental compliance. These factors could impact profitability and operational efficiency.
Financial Position
Alcoa's financial position remains strong with a healthy cash flow and manageable debt levels. However, attention should be paid to the balance sheet as higher capital expenditures could affect liquidity.
SWOT Analysis
Strengths
Strong brand recognition in the aluminum industry
Diversified operations across the aluminum production value chain
Robust profitability growth in Q4 2024
Weaknesses
High dependence on fluctuating raw material prices
Presence in politically volatile regions for mining operations
Opportunities
Increased demand for aluminum in renewable energy and electric vehicle sectors
Opportunities to enhance operational efficiencies further
Threats
Geopolitical tensions affecting supply chains
Regulatory pressures related to environmental impacts