US-based semi-finished aluminum manufacturer Kaiser Aluminum boosted its second-quarter shipments from the prior year, attributing the growth to customers' stronger-than-anticipated inventory drawdowns, restocking activity and onshoring efforts — trends that the company expects to persist well into 2027.
"The most notable development was the continued strengthening demand across most of our key end markets," Kaiser chief executive Keith Harvey said. "Activity accelerated throughout the period at a pace that exceeded our expectations."
The Tennessee-based company now expects to reach the top end of its full-year delivery forecast, which it revised in April for some of its product segments because of the improved demand signals from consumers.
Total sales volumes in April-June rose by 6pc to nearly 306mn lbs on the year, reflecting increased aerospace, packaging and general engineering shipments, Kaiser said on Thursday in its latest earnings report. Only automotive deliveries declined, reflecting challenges in the wider industry because of high borrowing costs for consumers and tariff dynamics, it added.
Quarterly aerospace deliveries increased by 1.5pc to nearly 61mn lbs on the year, with order activity picking up as airframers ramp up their build rates for narrowbody and widebody platforms. Kaiser anticipates that industry destocking, which has beset commercial aerospace supply chains in recent years, is "largely behind us", except for certain plate products.
Still, the company found outlets for those flat-rolled goods in the broader aerospace industry, such as for business/regional jets, and defense and space applications. Kaiser also was able to utilize its expanded capacity at its Trentwood mill in Spokane Valley, Washington, because of stronger demand from the semiconductor industry for "value-added" plate.
Packaging sales volumes in April-June grew by 10pc to 156mn lbs on the year, with Kaiser ramping up production from its newest coating line for lid stock at its Warrick plant in Newburgh, Indiana, and improving delivery timing to customers as Fifa world cup festivities and "typical summer growth" drove demand. The company reached an 80pc utilization rate from that line, adding that it is still working on optimizing the equipment to reach its target production capacity in 2027.
Quarterly general engineering shipments rose by 6.8pc to 68mn lbs from the prior-year period, as both original equipment manufacturers and distributors increased bookings to replenish stocks after operating with lean inventories for multiple years, Kaiser said.
"The themes we've discussed over the last several quarters — reshoring domestic manufacturing investment, semiconductor expansion and increasing demand for specialized plate products — are no longer just anecdotes," Harvey said. "They have become structural changes in our markets."
Automotive deliveries in the second quarter fell by 11pc to approximately 21mn lbs on the year, which Kaiser attributed to "fluctuations in consumer demand and industry build schedules". Still, the company sees demand remaining firm for pickup trucks and SUVs, which are "the platforms most aligned" with its product portfolio.
The company delayed some "major" maintenance projects from the second quarter and is expecting a heavier amount of planned outages in the second half of 2026.
Kaiser's quarterly profit more than quadrupled to $97mn on the year, as revenues increased by 53pc to nearly $1.3bn in the same period.
