Alcoa (AA) to Shutter Anglesea Power Station Following Failure to Sell Asset

Alcoa (NYSE: AA) announced that Alcoa of Australia will permanently close the Anglesea coal mine and power station on August 31, 2015.

The Anglesea power station previously supplied approximately 40 percent of the power needs for the Point Henry smelter in Geelong, Victoria. Alcoa said in February 2014 that it would conduct a sales process for the site, which has been operating as an independent supplier to the National Electricity Market since the smelter closed in August 2014. The sales process did not result in a sale.

“Our key concern now is for our 85 employees who have done a great job in continuing to run the operation during this period of uncertainty,” said President Alcoa Refining and Managing Director, Alcoa of Australia, Alan Cransberg. “Alcoa has been a proud member of the Anglesea community for more than 46 years, and our focus is in supporting our employees and their families, our contractors, suppliers and community partners through this transition.”

After closing the Point Henry operations in 2014 Alcoa contributed AUS$5million into the Geelong Region Innovation and Investment Fund to support job creation projects that strengthen and diversify the regional economy and employment base.

“We look forward to the Fund continuing to create new employment opportunities in the region, and as we did with the Geelong community, we will be exploring how best to assist our Anglesea community partners,” Cransberg said.

As a result of the closure, Alcoa expects to record 2015 restructuring-related charges of $30 million to $35 million, after-tax and non-controlling interest, or $0.02 to $0.03 per share, of which approximately 80 percent would be recorded in the second quarter. Alcoa’s free cash flow target for 2015 of $500 million remains unchanged.

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