Chalco Q3 net lags forecast, outlook bleak

HONG KONG, Oct 25 (Reuters) - Aluminum Corp of China Ltd , the country's top aluminium maker, missed forecasts for third-quarter earnings and analysts say its outlook is bleak as a slowing global economy hurts prices for the lightweight metal.

Three-month aluminium contracts on the London Metal Exchange fell to their lowest in more than a year last week, while aluminium prices SAFc3 in Shanghai were down about 1.5 percent this month on a global slump in metals prices.

Chalco posted a net profit of 554.99 million yuan ($87.05 million) for the July-September quarter, against a net loss of 117.81 million yuan a year earlier, it said in a statement to the Shanghai stock exchange on Tuesday .

The result missed an average forecast of 610 million yuan from six analysts polled by Reuters.

Sales rose 45 percent to 41.64 billion yuan, Chalco said.

Alcoa Inc , the largest U.S. aluminium producer, said earlier this month that an economic slowdown had hurt demand and knocked prices for the metal lower, denting its third-quarter profit.

Demand for aluminium, which is closely tied to economic activity, has been solid this year in China, the world's largest consumer of the metal used in industries from packaging to construction and aviation.

But China's domestic aluminium makers have been plagued by high production costs, such as energy and raw materials, and overcapacity.

Aluminium capacity in China was about 23.5 million tonnes, and production this year was likely to be about 19 million tonnes, Standard Chartered said.

"Going into the fourth quarter, we think there will continue to be a supply response given the attractive aluminium prices now, which will continue to act as a cap on aluminium prices," it said in a research report last month.

Chalco's Hong Kong-listed shares ended up 1.8 percent on Tuesday before the results were announced. They are down 45 percent so far this year, underperforming the Hang Seng Index , which was down 17.7 percent in the same period.

The company planned to issue additional equity via an A-share placement in Shanghai to raise capital for growth in bauxite, alumina, and coal and to boost working capital, analysts said.