Kaiser confident on aero despite 737 MAX woes

California-based rolling mill Kaiser Aluminum expects steady second-half 2019 aerospace shipments, even amid severe setbacks for Boeing's 737 MAX program.

"Although timing of the Boeing 737 MAX resolution is uncertain, our second half 2019 aerospace order book is strong with solid visibility well into 2020," Kaiser chief executive Jack Hockema said in the company's second quarter earnings.

The US Federal Aviation Administration grounded all B737 MAX aircraft on 13 March following the fatal crash of Ethiopian Airlines Flight 302. Carriers including Southwest Airlines and American Airlines have extended their grounding of the aircraft through October pending the model's recertification.

But high demand from aerospace customers boosted Kaiser's second quarter shipments by 8.3pc to 169mn lbs (76,657t) compared with the same quarter in 2018.

"Despite the production constraints, our aerospace shipments during the quarter continued to reflect a very strong order book," Hockema said.

Kaiser performed planned maintenance at its Trentwood rolling mill in Spokane, Washington, during the quarter, which cut into output of general engineering products. The company prioritized its heat treatment processing for aerospace shipments.

Sales adjusted for metal costs during the second quarter were nearly flat from the prior year at $209mn. Total sales fell by 9.6pc on the year to $375mn. Second quarter profits declined by 18pc to $23mn from a year earlier.