EX-99.2 3 dex992.htm SLIDES PRESENTED DURING ALCOA INC. THIRD QUARTER 2008 EARNINGS CALL

[Alcoa logo] October 7, 2008 3 rd Quarter 2008 Analyst Conference Exhibit 99.2

2 [Alcoa logo] Forward Looking Statements Today’s discussion may include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements relate to future events and expectations and involve known and unknown risks and uncertainties. Alcoa’s actual results or actions may differ materially from those projected in the forward-looking statements. For a summary of the specific risk factors that could cause results to differ materially from those expressed in the forward-looking statements, please refer to Alcoa’s Form 10-K for the year ended December 31, 2007 and Forms 10-Q for the quarters ended March 31, 2008 and June 30, 2008, and other reports filed with the Securities and Exchange Commission.

[Alcoa logo] Executive Vice President and Chief Financial Officer Chuck McLane

4 [Alcoa logo] 3 rd Quarter 2008 Financial Overview – Net income of $268m, or $0.33 per share – includes $29m or $0.04 per share for restructuring – Sequentially, currency translation was a negative $52m, or $0.06 per share – Typical sequential seasonal decline amplified by weakening markets – Revenues of $7.2 billion – up from $6.5 billion in 3Q 2007, excluding divested businesses – Increases in input costs persist – Cash on hand at $831m with debt-to-capital at 36.3% – Trailing 12-month ROC stands at 11.5%, excluding growth investments

5 [Alcoa logo] Margin squeeze impacting entire industry Alumina EBITDA Change –1H 08 vs 1H 07 Smelting EBITDA Change –1H 08 vs 1H 07 Alcoa (-27%) Competitor A (- 40%) Competitor B (- 40%) Competitor C (-23%) Alcoa (-22%) Competitor A (- 44%) Competitor B (-13%) Competitor C (-21%) Source: Company filings

6 [Alcoa logo] 7,412 7,123 3Q07 3Q08 $250 $526 3Q07 3Q08 110% The industry is facing significant input cost escalation Caustic Soda ( per dmt) 88% Calcined Coke (per mt) Ocean Freight (Baltic Dry Index) (4%) Natural Gas (US Henry Hub per MMBtu) 47% Fuel Oil (Low Sulfur Oil Index per bbl) 77% Source: CMAI Source: PACE Source: Bloomberg Source: Bloomberg Source: Bloomberg U.S. Dollar* (6%) Source: Bloomberg * Relative USD value vs weighted average of Alcoa exposure to AUD, CAD, BRL, & EUR $510 $958 3Q07 3Q08 $57 $101 3Q07 3Q08 94 100 3Q07 3Q08 $6.18 $9.06 3Q07 3Q08

7 [Alcoa logo] 3Q vs 3Q 2007 Earnings Bridge Income from Continuing Operations excluding Restructuring, Transaction Costs, and Chalco Gain millions 340 139 17 298 50 36 145 24 23 64 35 117 177 $0 $100 $200 $300 $400

8 [Alcoa logo] Sequential Income Statement In Millions 2Q 08 3Q 08 Change Sales $7,620 $7,234 (5%) Cost of Goods Sold $6,090 $5,944 (2%) % of Sales 79.9% 82.2% 2.3 pts SG&A $306 $283 (8%) % of Sales 4.0% 3.9% (0.1 pts) Restructuring and Other Charges $2 $43 nm Interest Expense $87 $97 11% Other Expense/(Income) $(97) $17 nm Effective Tax Rate 27.3% 24.9% (2.4 pts) Minority Interests $70 $84 20% Net Income $546 $268 (51%) Earnings per Diluted Share $0.66 $0.33 (50%)

9 [Alcoa logo] 3Q vs 2Q 2008 Earnings Bridge Income from Continuing Operations Excluding Restructuring millions 396 539 23 298 98 17 9 27 45 34 18 76 $0 $100 $200 $300 $400 $500 $600

10 [Alcoa logo] 3Q 08 2Q 08 3Q 07 2,010 1,913 1,937 3 Party Shipments (kmt) 3,790 3,820 3,775 Production (kmt) 805 717 664 3 Party Revenue ($ million) 206 190 215 ATOI ($ million) Production records at Pinjarra & San Ciprian Point Comfort production affected by Hurricane Ike (~ 60 kmt) Sequential adverse effect of Western Australia gas disruption of $9 million Higher caustic & fuel oil costs of $16 million Favorable currency effects of $29 million Alumina 3 rd Quarter Highlights 4 th Quarter Outlook Prices to follow approximate two-month lag – currently 12% lower than 3Q Higher caustic costs Current currency levels will lower costs if sustained Sequential benefit of approximately $15 million as recovery continues from Western Australia gas disruption; 4Q impact ~ ($10) million 3 rd Quarter Business Conditions $100 $120 $140 $160 $180 $200 $220 $240 $260 $280 $300 1Q 07 2Q 07 3Q 07 4Q 07 1Q 08 2Q 08 3Q08 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 ATOI Total Revenue rd rd

11 [Alcoa logo] 3 rd Quarter Highlights 297 428 283 ATOI ($ million) 2,945 3,058 2,734 3 Party Price ($/mt) 2,127 2,437 1,600 3 Party Revenue ($ million) 3Q 08 2Q 08 3Q 07 704 750 584 3 Party Shipments (kmt) 1,011 1,030 934 Production (kmt) Primary Metals 4 th Quarter Outlook 3 rd Quarter Business Conditions Realized pricing down 4% sequentially Higher costs for carbon products and LME- linked costs Iceland efficiency & volume gains of $14 million Favorable currency effects of $29 million Current cash LME ~ $2,250/mt Higher input costs continue Current currency levels will lower costs if sustained Sequential negative impact of complete Rockdale curtailment expected to be approximately $30 million during the period $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 $550 1Q 07 2Q 07 3Q 07 4Q 07 1Q 08 2Q 08 3Q08 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 $5,000 ATOI Total Revenue rd rd rd

12 [Alcoa logo] Flat-Rolled Products 4 th Quarter Outlook 3 rd Quarter Business Conditions (38) (26) (29) Russia, China & Other 55 7 74 2Q 08 Total Hard Alloy Extrusions Global Rolled Products, exc Russia & China 62 6 85 3Q 07 29 7 60 3Q 08 ATOI ($ million) Weak end markets in North America & Europe expected to persist Higher costs for metals, energy & coatings Prolonged Boeing strike would crimp profitability Bohai start-up costs Typical seasonal slowdown compounded by softer market demand Higher costs for metals & energy of $8 million Start-up costs in China of $3 million Favorable currency effects of $9 million ($20) $0 $20 $40 $60 $80 $100 $120 1Q 07 2Q 07 3Q 07 4Q 07 1Q 08 2Q 08 3Q08 $1,600 $1,800 $2,000 $2,200 $2,400 $2,600 $2,800 $3,000 ATOI Third Party Revenue

13 [Alcoa logo] Engineered Products and Solutions 7 11 12 Building and Construction & Other 157 155 (9) 2Q 08 Total Investment Castings, Forgings & Fasteners AFL, Auto Castings & Structures 82 102 (32) 3Q 07 101 131 (37) 3Q 08 Record third quarter profitability Volume decreases in excess of typical seasonal slowdown for automotive & commercial transportation Aerospace spares demand decreasing U.S. commercial building & construction market decline accelerates ATOI ($ million) 3 rd Quarter Business Conditions 4 th Quarter Outlook Weak market conditions persist in automotive, commercial transportation and accelerating decline in building & construction Prolonged Boeing strike will crimp profitability IGT market continues strong with industry at capacity and expanding $0 $20 $40 $60 $80 $100 $120 $140 $160 $180 1Q 07 2Q 07 3Q 07 4Q 07 1Q 08 2Q 08 3Q08 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 ATOI Third Party Revenue

14 [Alcoa logo] Cash Flow Statement In Millions 3Q 07 2Q 08 3Q 08 Net Income $555 $546 $268 DD&A 338 321 317 Change in Working Capital 345 234 (519) Other Adjustments (440) (46) 259 Pension Contributions (206) (48) (418) Cash From Operating Activities $592 $1,007 $(93) Dividends to Shareholders $(150) $(140) $(140) Change in Debt (494) 199 1,573 Dividends to Minority Interests (106) (78) (76) Contributions from Minority Interests 152 181 130 Share Repurchases (1,295) (175) (477) Share Issuances 391 154 1 Other Financing Activities 41 11 (7) Cash From Financing Activities $(1,461) $152 $1,004 Capital Expenditures $(941) $(796) $(877) Sales of Assets/Investments 2,041 149 115 Additions to Investments (67) (22) (39) Other Investing Activities (25) (86) (56) Cash From Investing Activities $1,008 $(755) $(857)

15 [Alcoa logo] 3.9 9.8 8.6 9.2 6.3% 5.6% 5.2% 6.2% Pre New Issue Post New Issue Pre New Issue Post New Issue Weighted Life (Years) Weighted Interest Rate Management actions leading to better capital structure Long-Term Debt Maturity Profile ($Millions) Cash & CP History ($Millions) January 2007 and July 2008 issuances increased average debt maturity Annual maturities are manageable over the long-term Minimal 2009 maturities Liquidity is strong due to higher cash balances Refinancing Impacts 2007 New Issue 2008 New Issue 0 400 800 1,200 1,600 Q4'07 Q1'08 Q2'08 Q3'08 Commercial Paper Cash

[Alcoa logo] President and Chief Executive Officer Klaus Kleinfeld

17 [Alcoa logo] Market conditions weakened during 3 rd Quarter Growth by Industry & Geography 2008 vs. 2007

18 [Alcoa logo] Slowing growth in several regions Source: Alcoa analysis 2nd Quarter Forecast 3rd Quarter Forecast 1.0 1.1 5.3 6.0 8.0 13.8 Brazil CIS Asia w/o China North America Europe China 2008 Projected Consumption (million mt) 6% 15% 8% 3% -5% -10% 1% -2% 22% 15% 2008 Projected Growth Rates Note: 2008 Projected Global Consumption: 40.4 million mt 2008 Global Demand Growth Rates 2Q Forecast: +8% 3Q Forecast: +6%

19 [Alcoa logo] Higher inventories and lower LME price Source: LME 0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500

20 [Alcoa logo] Cash cost (per mt) About 1/3 of global production under water Source: CRU International, Alcoa analysis Worldwide Capacity (million mt) Global Smelting Cash Cost Curve (per mt) Note: 2008 cost curve adjusted to reflect current LME, FX, coke costs ~ 1/3 total Current LME price = $2,200/mt $800 $1,200 $1,600 $2,000 $2,400 $2,800 $3,200 $3,600 0 5 10 15 20 25 30 35 40 45 2005 2006 2007 2008

21 [Alcoa logo] $2,200 $2,400 $2,600 $2,800 $3,000 $3,200 $3,400 $3,600 3 mo 15 mo 27 mo 39 mo 51 mo 63 mo 123 mo Market remains optimistic on aluminum prospects Source: Bloomberg +23% Forward Curve of LME Aluminum Pricing June 30, 2008 Sept 30, 2007 Sept 30, 2008

22 [Alcoa logo] Taking decisive actions Decelerating Aluminum Growth End Market Weakness Cost Pressures Global Liquidity Crisis Alcoa Actions Review Upstream Footprint Review Product Portfolio Capture Pricing Opportunities Balance Capacity with Demand Complete Repowering Efforts Capture Procurement Opportunities Suspend Share Repurchases Stop Non-Critical Capital Spend M A R K E T C O N D I T I O N S

23 [Alcoa logo] 23 8.2 10.6 4.6 7.3 5.6 Strong demand for aluminum will continue World Aluminum Consumption (million metric tons) Source: Brook Hunt, Alcoa analysis 22 1998 China Rest of Asia 2.8 6.7 3.6 North 9.2 8.6 29.1 67 2017 E. Europe/ Mid East/ Africa W.Europe South 6.7 5.2 12.0 38 2007 6% CAGR 6% CAGR Europe/ME/ Africa Americas Asia 12% 1% 6% 8% 4% 5% 2.5 0.8 1.3 2.6

24 [Alcoa logo] 2008F 2009F 2010F Projected Cash Conversion Cost of Production (per mt) Fjardaal – successful start-up that will drive profit growth +30 kmt (17%) Source: Alcoa analysis + $ 170m incremental EBITDA in 2010 Projected Smelting Production (kmt) 320 346 350 2008F 2009F 2010F

25 [Alcoa logo] Sao Luis Alumina Refinery Expansion • Expansion from 0.8 million mt to 1.9 million mt • Investment of $1.6 billion • Projected to move from 33 percentile to 14 percentile on cash cost curve Brazil mining & refining projects to contribute to results Juruti Bauxite Mine Development • Initial production of 2.6 million mt per annum – estimated 200 year reserve • Investment of $2.0 billion with significant infrastructure investment enabling future expansions + $ 80m incremental EBITDA in 2010 Note: Alcoa share = 60% of above rd th

26 [Alcoa logo] Can sheet market provides profitable growth opportunities Source: Alcoa analysis • Strong global demand growth • Alcoa well-positioned with global customers • Recycling infrastructure improves cost position and environmental footprint • Expiration of can sheet contract provides earnings opportunity Can Sheet Opportunity + $ 320m incremental EBITDA in 2010 +41% p.a. Alcoa Can Sheet Production in Russia & China (kmt) 80 107 160 2008F 2009F 2010F

27 [Alcoa logo] We are committed to our strategic priorities Disciplined Execution across all activities Alcoa’s Three Strategic Priorities Profitable Growth in every business Business Programs that define: – 3-year aspirations – Priority levers – Accountability Alcoa Advantage creating value for all businesses – Talent – Technology – Customer Intimacy – Purchasing – Operating System

28 [Alcoa logo] Greg Aschman Director, Investor Relations Alcoa 390 Park Avenue New York, N.Y. 10022-4608 Telephone: (212) 836-2674 Facsimile: (212) 836-2813 www.alcoa.com For Additional Information, Contact:

29 [Alcoa logo] [Alcoa logo]

30 [Alcoa logo] APPENDIX [Alcoa logo]

31 [Alcoa logo] In the first quarter of 2008, management approved a realignment of Alcoa's reportable segments to better reflect the core businesses in which Alcoa operates and how it is managed. This realignment consisted of eliminating the Extruded and End Products segment, and realigning its component businesses as follows: the building and construction systems business is reported in the Engineered Products and Solutions segment; the hard alloy extrusions business and the Russian extrusions business are reported in the Flat-Rolled Products segment; and the remaining segment components, consisting primarily of the equity investment/income of Alcoa's interest in the Sapa AB joint venture, and the Latin American extrusions business, are reported in Corporate. Additionally, the Russian forgings business was moved from the Engineered Products and Solutions segment to the Flat-Rolled Products segment, where all Russian operations are now reported. Prior period amounts were reclassified to reflect the new segment structure. Also, the Engineered Solutions segment was renamed the Engineered Products and Solutions segment. Reconciliation of ATOI to Consolidated Net Income $ 268 $ 546 $ 303 $ 2,564 $ 632 $ 555 $ 715 $ 662 Consolidated net income (116) (32) (98) 741 303 446 (22) 14 Other (1) – – (7) 8 (3) (1) (11) Discontinued operations (29) (2) (30) (307) 1 (311) 21 (18) Restructuring and other charges (77) (91) (82) (388) (100) (101) (101) (86) Corporate expense (84) (70) (67) (365) (64) (76) (110) (115) Minority interests (63) (57) (64) (261) (53) (98) (56) (54) Interest expense 10 12 9 40 10 10 9 11 Interest income (5) (44) (31) (24) 9 10 (16) (27) Impact of LIFO Unallocated amounts (net of tax): $ 633 $ 830 $ 666 $ 3,135 $ 518 $ 678 $ 991 $ 948 Total segment ATOI 3Q08 2Q08 1Q08 2007 4Q07 3Q07 2Q07 1Q07 (in millions) $ 268 $ 546 $ 303 $ 2,564 $ 632 $ 555 $ 715 $ 662 Consolidated net income (116) (32) (98) 741 303 446 (22) 14 Other (1) – – (7) 8 (3) (1) (11) Discontinued operations (29) (2) (30) (307) 1 (311) 21 (18) Restructuring and other charges (77) (91) (82) (388) (100) (101) (101) (86) Corporate expense (84) (70) (67) (365) (64) (76) (110) (115) Minority interests (63) (57) (64) (261) (53) (98) (56) (54) Interest expense 10 12 9 40 10 10 9 11 Interest income (5) (44) (31) (24) 9 10 (16) (27) Impact of LIFO Unallocated amounts (net of tax): $ 633 $ 830 $ 666 $ 3,135 $ 518 $ 678 $ 991 $ 948 Total segment ATOI 3Q08 2Q08 1Q08 2007 4Q07 3Q07 2Q07 1Q07 (in millions)

32 [Alcoa logo] Days of Working Capital = Working Capital divided by (Adjusted Sales/number of days in the quarter) (a) Adjusted Sales is a non-GAAP financial measure and is being used to calculate Days of Working Capital to be consistent with the fact that the working capital components of the above-mentioned divested businesses were classified as held for sale, and, therefore, are not included in the Working Capital amounts above. Days of Working Capital $ 7,234 $ 7,601 $ 6,502 Adjusted Sales (a) 47.7 45.0 51.5 Days of Working Capital – 19 885 Packaging and Consumer, Soft Alloy Extrusions, and Auto Castings $ 7,234 $ 7,620 $ 7,387 Sales $ 3,753 $ 3,755 $ 3,638 Working Capital 2,791 3,121 2,649 Less: Accounts payable, trade 3,844 3,813 3,311 Add: Inventories $ 2,700 $ 3,063 $ 2,976 Receivables from customers, less allowances September 30, 2008 June 30, 2008 September 30, 2007 (in millions) Quarter ended $ 7,234 $ 7,601 $ 6,502 Adjusted Sales (a) 47.7 45.0 51.5 Days of Working Capital – 19 885 Packaging and Consumer, Soft Alloy Extrusions, and Auto Castings $ 7,234 $ 7,620 $ 7,387 Sales $ 3,753 $ 3,755 $ 3,638 Working Capital 2,791 3,121 2,649 Less: Accounts payable, trade 3,844 3,813 3,311 Add: Inventories $ 2,700 $ 3,063 $ 2,976 Receivables from customers, less allowances September 30, 2008 June 30, 2008 September 30, 2007 (in millions) Quarter ended

33 [Alcoa logo] Other Financial Reconciliations (in millions) September 30, 2008 Quarter ended Third-party Sales September 30, 2007 Debt-to-Capital Debt-to-Capital Cash and cash equivalents Net Debt-to- Capital Sales $ 7,387 Total Debt Short-term borrowings $ 498 $ – $ 498 Divested businesses (a) 885 Commercial paper 1,207 831 376 Long-term debt due within one year 54 – 54 Sales, excluding divested businesses $ 6,502 Long-term debt, less amount due within one year 8,370 – 8,370 Numerator $ 10,129 $ 831 $ 9,298 Total Capital Total debt (Numerator) $ 10,129 $ 831 $ 9,298 (a) Divested businesses include the businesses within the Packaging and Consumer segment, certain U.S. locations of the Soft Alloy Extrusions business that were not contributed to the Sapa AB joint venture, and the Automotive Castings business. Minority interests 2,740 – 2,740 Total shareholders’ equity 15,065 – 15,065 Denominator $ 27,934 $ 831 $ 27,103 Quarter ended Cash From Operations September 30, 2008 Ratio 36.3% 34.3% Cash used for operations $ (93) Pension contributions 418 Cash from operations, excluding pension contributions $ 325

34 [Alcoa logo] Reconciliation of Adjusted Income (in millions) Quarter ended 3Q07 2Q08 3Q08 Net income $ 555 $ 546 $ 268 Loss from discontinued operations (3) – (1) Income from continuing operations 558 546 269 Discrete tax items 464 (9) – Gain on sale of Chalco investment (1,140) – – Transaction costs* 55 – – Restructuring and other charges** 403 2 29 Income from continuing operations – as adjusted $ 340 $ 539 $ 298 * Transaction costs include investment banking, legal, audit related, and other third party expenses, and interest expense related to the offer for Alcan. All costs except for interest expense are included in Selling, general administrative, and other expenses on the Statement of Consolidated Income. ** In the third quarter of 2007, Restructuring and other charges include a $93 after tax goodwill impairment charge related to the Electrical and Electronic Solutions business.

35 [Alcoa logo] (2) Year 2010 projections of EBITDA are forward-looking non-GAAP financial measures. As such the most directly comparable GAAP measures for 2010 (actual net income) are not yet available. However, management believes that the 2010 projections are meaningful to investors because of the magnitude of the potential earnings contribution. Year 2010 projections are based upon September 2008 year-to-date pricing and input costs and represent an incremental add to EBITDA with a base year of 2008. Iceland EBITDA is for the Fjarðaál smelter, Brazil EBITDA is for the Juruti bauxite mine development and São Luís alumina refinery expansion, and Can Sheet EBITDA is for Alcoa’s global can sheet businesses and assumes the elimination of LME-related pricing caps by the end of 2009 and volume increases of at least 30 percent in Russia and China. Forward-looking statements are subject to risks, contingencies, and uncertainties and are not guarantees of future performance. Actual results, performance or outcomes may differ materially from those expressed in or implied by these forward looking statements. See Slide 2 (Forward Looking Statements) for additional information. EBITDA Reconciliations (in millions) Six months ended June 30, 2007 Six months ended June 30, 2008 Six months ended June 30, 2007 Six months ended June 30, 2008 Alumina Primary Metals After-tax operating income (ATOI) (1) $ 536 $ 359 $ 966 $ 735 Add: Income taxes 202 124 410 247 Depreciation, depletion, and amortization 118 141 197 252 Earnings before interest, taxes, depreciation, and amortization (EBITDA) $ 856 $ 624 $ 1,573 $ 1,234 (1) See Slide 33 for a reconciliation of segment ATOI to consolidated net income. Year 2010 Projections (2) Iceland Brazil Can Sheet Net income $ 130 $ 30 $ 250 Add: Minority interests – 15 – Income taxes 30 5 60 Depreciation, depletion, and amortization 10 30 10 EBITDA $ 170 $ 80 $ 320

36 [Alcoa logo] Return on Capital (ROC) is presented based on Bloomberg Methodology which calculates ROC based on trailing four quarters. Reconciliation of Return on Capital 3Q'08 2Q'08 1Q'08 4Q'07 3Q'07 2Q'07 1Q'07 Bloomberg Bloomberg Bloomberg Bloomberg Bloomberg Bloomberg Bloomberg (In Millions) Method Method Method Method Method Method Method Net income $1,749 $2,036 $2,205 $2,564 $2,291 $2,273 $2,302 Minority interests $285 $277 $317 $365 $399 $432 $446 Interest expense (after-tax) $312 $267 $266 $262 $246 $270 $281 Numerator (sum total) $2,346 $2,580 $2,788 $3,191 $2,936 $2,975 $3,029 Average Balances Short-term borrowings $537 $568 $524 $516 $497 $451 $441 Short-term debt $126 $352 $358 $356 $525 $359 $360 Commercial paper $782 $819 $864 $1,164 $1,275 $1,169 $972 Long-term debt $7,351 $6,523 $6,374 $5,574 $5,390 $5,709 $5,767 Preferred stock $55 $55 $55 $55 $55 $55 $55 Minority interests $2,532 $2,519 $2,320 $2,130 $1,927 $1,809 $1,669 Common equity $15,435 $16,695 $15,563 $15,269 $15,255 $15,571 $14,621 Denominator (sum total) $26,818 $27,531 $26,058 $25,064 $24,924 $25,123 $23,885 Return on Capital 8.7% 9.4% 10.7% 12.7% 11.8% 11.8% 12.7%

37 [Alcoa logo] Return on capital, excluding growth investments is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because it provides greater insight with respect to the underlying operating performance of the company’s productive assets. The company has significant growth investments underway in its upstream and downstream businesses, as previously noted, with expected completion dates over the next several years. As these investments generally require a period of time before they are productive, management believes that a return on capital measure excluding these growth investments is more representative of current operating performance. Reconciliation of Adjusted Return on Capital 3Q'08 2Q'08 1Q'08 4Q'07 3Q'07 2Q'07 1Q'07 Bloomberg Bloomberg Bloomberg Bloomberg Bloomberg Bloomberg Bloomberg (In Millions) Method Method Method Method Method Method Method Numerator (sum total) $2,346 $2,580 $2,788 $3,191 $2,936 $2,975 $3,029 Russia, Bohai, and Kunshan net losses ($132) ($118) ($96) ($91) ($57) ($51) ($79) Adjusted numerator $2,478 $2,698 $2,884 $3,282 $2,993 $3,026 $3,108 Average Balances Denominator (sum total) $26,818 $27,531 $26,058 $25,064 $24,924 $25,123 $23,885 Capital projects in progress and Russia, Bohai, and Kunshan capital base $5,244 $5,289 $4,730 $4,620 $4,430 $4,521 $3,945 Adjusted denominator $21,574 $22,242 $21,328 $20,444 $20,494 $20,602 $19,940 Return on capital, excluding growth investments 11.5% 12.1% 13.5% 16.1% 14.6% 14.7% 15.6%