Alcoa Corp (NYSE:AA) an international leader in alumina, aluminum and bauxite products reported that it has amended its revolving credit agreement worth $1.5 billion with enhanced terms for the firm. The amendment on the deal eases certain financial covenants to offer increased flexibility for the firm in a range of segments, including expanded alternatives for permitted investments and debt.
William Oplinger, the Chief Financial Officer and Executive Vice President of Alcoa, expressed that in their first year as an independent firm, they have realized robust financial performance boosted by promising market conditions. The changes to the revolving credit deal is a recognition of their strengthened financial position, and the enhanced terms offer increased latitude to deliver on their strategic priorities to drive returns, strengthen the balance sheet and reduce complexity. The revised agreement also offers increased flexibility for company to execute its capital allocation plan.
Oplinger expressed that as a commodity firm, they will maintain a conservative plan for capital allocation that puts a priority on maintaining a robust cash balance, supporting current operations and subsequently investing in profitable projects. After meeting those goals and their obligations, they intend to return cash to their shareholders in a sustainable way.
Alcoa, Alcoa Nederland Holding B.V. and 24 contributing financial institutions decided the amended revolving credit agreement. This deal extends the maturity date to November 14, 2022 from earlier date of November 1, 2021. JPMorgan Chase Bank will be the administrative agent for the same.
Alcoa marks as an international industry pioneer in alumina, aluminum and bauxite products, with a robust portfolio of value-added cast and substantial energy assets and rolled products. The company is established on a foundation of operating excellence and strong values going back almost 130 years to the revolutionary discovery that made aluminum an important part of modern life.
In the last trading session, the stock price of Alcoa gained more than 1% to close the day at $41.40.