Jason Sandefur

Lower demand for aerospace MRO spares held sales at Alcoa’s Engineered Products segment, including fasteners, to a modest 3.2% gain in sales, during the third quarter of 2008. Segment Q3 sales reached $1.72 billion, while after-tax operating income increased 23% to $101 million over the third quarter of 2007. However, ATOI dropped 36% between the second and third quarters of 2008.

“Due to tighter credit conditions and high gas prices, annual automotive build rates are now projected to decline 14% in North America,” the company noted. “Commercial transportation markets have also been weaker than expected.”

Engineered Products sales grew 6% to $5.36 billion during the first nine months of 2008, with operating income jumping 29% to $396 million.

Overall Q3 sales declined 2% to $7.2 billion, while net income dropped 52% to $268 million.

Alcoa CEO Klaus Kleinfeld said the company is taking steps to weather the global economic crisis, such as stopping on non-critical capital projects, cutting manufacturing capacity and suspending its stock buy-back program.

Dwindling commodity demand has led to a 32% drop in aluminum prices since July. Nickel, copper and lead prices have also declined.

Alcoa reported sales during the first nine months of 2008 slipped 4.8% to $22.23 billion, with net income declining 42% to $1.12 billion. Web: alcoa.com �2008 FastenerNews.com