Profits continue to rise for Kaiser

Kaiser Aluminum Corp.’s rebound from bankruptcy continues as executives reported a $25 million third-quarter profit and said the company was poised to continue earning money even as prices and demand for aluminum products softens.

With a $140 million expansion under way, Kaiser’s Trentwood rolling mill continues to produce high-grade aluminum sheet and plate that fetched high prices and led the company’s performance, chief executive Jack Hockema said.

Kaiser’s profits were 73 percent higher than during the same three-month period a year ago.

“Things have really been moving for Kaiser. It’s an exciting time,” said company spokesman Geoff Mordock.

Overall sales in the third quarter were $366.7 million.

For the first nine months of 2007, Kaiser has profits of $77 million on sales of $1.14 billion.

That compares with $65 million in profits on $1.02 billion in sales during the first nine months of 2006.

Hockema told analysts that Kaiser has benefited from sharp demand, which has delivered margins he called “extremely rich.”

He said declining prices and less demand would lower those margins for the rest of the year and 2008.

Kaiser does not offer detailed earnings guidance to analysts, but Hockema told those listening to an earnings conference call that he anticipated some slowdowns due to delays on the Airbus A380, and to a lesser degree, the Boeing 787 program.

Also, he said Kaiser’s future growth initiatives will focus on acquisitions.

The good financial news for Kaiser correlates into good news for its employees and retirees who lost benefits during the company’s Chapter 11 bankruptcy.

As part of Kaiser’s emergence from bankruptcy, about 57 percent of the company’s new stock was awarded to the Voluntary Employees’ Beneficiary Association trust. It was set up to capture a good share of Kaiser’s future profits to fund retiree benefits such as prescription drug coverage.

The trust has sold stock but retains a major stake in Kaiser and has an investor’s interest in the company’s success.

About 3,000 Steelworkers or surviving spouses live in Eastern Washington where Kaiser also operated the now-shuttered Mead smelter.

There are currently about 650 Steelworkers and more than 200 managers and support staff at Trentwood.