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MADRID - Alcoa Corporation (NYSE:AA), the global aluminum producer with a market capitalization of $8.05 billion and currently trading below its InvestingPro Fair Value, and joint venture partner IGNIS Equity Holdings announced Monday they will resume the restart process of their San Ciprián aluminum smelter in Spain, following assurances from the government about grid resilience.
The restart had been paused after an April 28 power outage affected both the San Ciprián refinery and smelter, causing significant damage and delaying the restart timeline. The joint venture sought details from the Spanish government about the cause and preventive measures before proceeding. With a solid financial health score rated as GOOD by InvestingPro and trailing twelve-month revenue of $12.66 billion, Alcoa maintains a strong operational foundation despite these challenges.
"We have reviewed the Spanish Government’s report on the circumstances that caused the power outage, and the planned measures and investments aimed at providing improved grid resilience," said Rob Bear, Vice President, Spain for Alcoa.
The joint venture now estimates the restart will be completed by mid-2026, later than previously planned. Due to this delay, Alcoa has revised its financial outlook, expecting to record a net pre-tax loss for the smelter of approximately $90 million to $110 million in 2025, with associated cash used by operations expected to be between $110 million and $130 million. Trading at a P/E ratio of 8.52, InvestingPro analysis reveals 6 additional key insights about Alcoa’s investment potential, available exclusively to subscribers.
The unfavorable change from prior estimates is attributed to the postponement of restart completion and related revenue from 2025 into 2026, according to the company’s press release statement.
Alcoa Corporation is a global producer of bauxite, alumina and aluminum products, while IGNIS EQT is a vertically integrated energy company based in Spain that manages an operational portfolio of 8 GW of generation technologies.
In other recent news, Alcoa Corporation has completed the sale of its 25.1% stake in the Ma’aden Joint Venture to Saudi Arabian Mining Company for approximately $1.35 billion in shares and cash. This transaction is expected to result in a gain of about $780 million for Alcoa in the third quarter of 2025. Additionally, Alcoa announced a quarterly cash dividend of $0.10 per share for its common and preferred stock, scheduled for payment in June 2025. The company also reported a robust order book for the second quarter, despite facing U.S. tariffs and potential risks from a power outage in Spain.
Furthermore, Alcoa received a favorable ruling in a tax dispute with the Australian Taxation Office regarding alumina sales, which could lead to a refund of $67 million if no appeal is filed. Citi has resumed coverage on Alcoa with a Buy rating, setting a price target of $42.00 and highlighting a bullish outlook on aluminum demand. The investment bank noted potential risks related to free cash flow, especially concerning Alcoa’s operations at San Ciprian. These developments reflect Alcoa’s ongoing efforts to manage its portfolio and financial performance.
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