Shares of Foothill Ranch-based Kaiser Aluminum Corp. slumped Wednesday,a day after the company reported a charge-laden quarterly loss and was cautious about the current quarter.
Chief Executive Jack Hockema also said the company plans to take advantage of low prices and sluggish demand during the global recession to make acquisitions.
Hockema is looking for “complementary acquisitions that would add value,” he told Wall Street analysts. The company was evaluating buying mostly smaller businesses as well as some bigger companies.
The company’s stock was down about 3.5% at close of trading on a market value of $440 million.
On Tuesday, Kaiser reported a fourth-quarter loss of $108 million, versus a profit of $24.4 million a year earlier.
Charges of $192 million drove the loss. Before charges, Kaiser made $31 million, down 20% from a year earlier.
Kaiser shapes aluminum into custom pieces for the defense and auto industries.
Last month, the company warned investors of a pending loss from charges related to falling prices for aluminum and other metals. Other charges stem from plant closures and cuts in Oklahoma and Virginia.
Kaiser and other aluminum products companies have seen a drop in demand along with a steep fall in the price of aluminum in the past year.
Aluminum is selling for around 65 cents per pound, down from more than $1.50 six months ago.
While the price drop reduces a key cost for Kaiser, other costs haven’t come down as fast with lower product prices erasing profits.
Kaiser’s fourth-quarter revenue fell 9% to $327 million but beat the $327 million analysts were expecting on average.
The company was guarded about the current quarter.
Kaiser said it expects to see aerospace demand hold steady, while automotive and industrial uses are “less certain.”
