EX-99.2 3 dex992.htm SLIDES PRESENTED DURING ALCOA INC. SECOND QUARTER 2010 EARNINGS CALL

2 nd Quarter 2010 Earnings Conference July 12, 2010 [Alcoa Logo] Exhibit 99.2

[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, 2009, Form 10-Q for the quarter ended March 31, 2010, and other reports filed with the Securities and Exchange Commission. 2

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

[Alcoa Logo] 2 nd Quarter 2010 Financial Overview Income from Continuing Operations of $137 million, or $0.13 per share Revenue increase of 6% driven by higher volumes Cash Sustainability Initiatives continued to deliver EBITDA of $724 million, EBITDA Margin of 14.0% Free Cash Flow positive Debt to Capital of 38.4%, Cash on hand of $1.34 billion 4

[Alcoa Logo] Revenue Change by Market 5% (7%) 9% 10% (1%) 5% 17% 23% 10% 0% (7%) 67% 5% 50% 47% (32%) (14%) 48% 59% 49% 2Q’10 Third Party Revenue Sequential Change Year-Over-Year Change 5 14% 3% 7% 4% 5% 2% 13% 6% 13% 33% Aerospace Automotive B&C Comm. Transport Industrial Products IGT Packaging Distribution/Other Alumina Primary Metals

[Alcoa Logo] Sequential Income Statement Summary 6 $ Millions 1Q’10 2Q’10 Change Sales $4,887 $5,187 $300 Cost of Goods Sold $4,013 $4,210 $197 COGS % Sales 82.1% 81.2% (0.9 % pts.) Selling, General Administrative, Other $239 $208 ($31) SGA % Sales 4.9% 4.0% (0.9 % pts.) Restructuring and Other Charges $187 $30 ($157) Effective Tax Rate (95.5%) 25.0% N/A (Loss) Income from Continuing Operations ($194) $137 $331 Loss from Discontinued Operations ($7) ($1) $6

[Alcoa Logo] 7 2 nd Quarter Restructuring and Special Items $ Millions After-Tax & Non- Controlling Interests Earnings Per Share Income Statement Classification Segment Restructuring ($20) Restructuring Corporate Discrete Tax Items $16 Taxes Corporate Special Items: $2 Rockdale Luminant Litigation ($7) Revenue & Cost of Goods Sold Primary USW Negotiations ($13) Cost of Goods Sold All Segments Mark -to-Market Derivatives $22 Other Income/Expense Corporate Total ($2) ($0.00)

[Alcoa Logo] 2 nd Quarter 2010 vs. 1 st Quarter 2010 Earnings Bridge Income (Loss) from Continuing Operations excluding Restructuring & Special Items ($ millions) 8 See appendix for reconciliation $101 ($36) $40 $16 $9 $23 ($14) $139

[Alcoa Logo] Alumina 2 nd Quarter Highlights 3 rd Quarter Outlook 2 nd Quarter Business Conditions 9 Realized third-party alumina price up 1% Currency benefit of $18 million, primarily driven by stronger USD against Australian dollar Sao Luis commissioning issues negatively impacted results by $11 million Pricing to follow two-month lag on LME Continued benefits from cash sustainability initiatives Production projected to increase 150 KMT 2 nd Quarter Performance Bridge $ Millions $72 ($3) $94 $18 $2 $3 $3 ($1) 2Q 09 1Q 10 2Q 10 Production (kmt) 3,309 3,866 3,890 3 rd Party Shipments (kmt) 2,011 2,126 2,264 3 rd Party Revenue ($MM) 441 638 701 ATOI ($MM) (7) 72 94

[Alcoa Logo] Primary Metals 2 nd Quarter Highlights 2 nd Quarter Business Conditions 3 rd Quarter Outlook 10 Realized pricing down 1% sequentially Higher alumina and LME-linked power costs based on quarter lag Positive currency impact of $18 million Lower non-LME linked energy costs benefit $11m Curtailed Fusina during quarter Pricing to follow 15-day lag to LME Continued productivity benefits from cash sustainability initiatives Production equal to second quarter 2 nd Quarter Performance Bridge $ Millions $123 ($6) $109 ($43) $2 $18 $11 $3 $1 2Q 09 1Q 10 2Q 10 Production ( kmt) 906 889 893 3 rd Party Shipments (kmt) 779 695 699 3 rd Party Revenue ($MM) 1,146 1,702 1,710 3 rd Party Price ($/MT) 1,667 2,331 2,309 ATOI ($MM) (178) 123 109

[Alcoa Logo] 11 Flat-Rolled Products 3 rd Quarter Outlook 2 nd Quarter Business Conditions 2 nd Quarter Highlights Higher volumes especially in Russia, North America, and China North American RPD margin and volume improvement Productivity benefit of $16 million on continuing gains from cash sustainability initiatives Growth businesses at breakeven profitability and Russia at positive ATOI North American RPD expected to fully offset margin impact from customer lost in 1Q’10 Improving demand in most regions, including Russia, China, and Europe Seasonal impact from summer plant slowdowns Continued benefits from cash sustainability initiatives 2 nd Quarter Performance Bridge $ Millions ATOI $ Millions 2Q 09 1Q 10 2Q 10 Global Rolled Products, excl Russia, China & Other 2 47 71 Russia, China & Other (37) (17) 0 Total ATOI (35) 30 71 $30 ($4) $18 ($1) $2 $16 $10 $71

[Alcoa Logo] Engineered Products and Solutions 2 nd Quarter Business Conditions 3 rd Quarter Outlook 2 nd Quarter Highlights 12 EBITDA margin up 2.7% points vs. Q2’09 despite $72 million in lower sales Productivity benefit of $14 million on continued strong performance in cash sustainability initiatives Volume improvements in Aerospace structural castings and Building and Construction IGT demand remained weak Seasonal impact from summer plant slowdowns Continued benefits from cash sustainability initiatives 2 nd Quarter Performance Bridge $ Millions $81 $3 $15 ($7) $14 $1 $107 $ Millions 2Q 09 1Q 10 2Q 10 3 rd Party Revenue 1,194 1,074 1,122 ATOI 88 81 107 EBITDA % of Revenue 14.5% 14.2% 17.2%

[Alcoa Logo] 2 nd Quarter 2010 Cash Flow Overview 13 See appendix for free cash flow reconciliation 2Q’10 FCF $87 million $1.34 billion of cash ($ Millions) 2Q'09 1Q'10 2Q'10 Net (Loss) Income ($459) ($179) $170 DD&A 317 358 364 Change in Working Capital 329 (336) (422) Pension Contributions (35) (22) (22) Taxes / Other Adjustments 176 378 210 Cash From Operations $328 $199 $300 Dividends to Shareholders (31) (32) (31) Change in Debt (59) (42) 35 Distributions to Noncontrolling Interest (2) (72) (41) Contributions from Noncontrolling Interest 94 27 37 Other Financing Activities (4) (61) 3 Cash From Financing Activities ($2) ($180) $3 Capital Expenditures (418) (221) (213) Other Investing Activities (215) 13 (33) Cash From Investing Activities ($633) ($208) ($246)

[Alcoa Logo] We Are Focused on Achieving Our 2010 Goals 14 *Procurement reduction of $2.5 billion Overhead reduction of $500 million Capital expenditures of $1.25 billion Days Working Capital reduction of 2 days Driving Positive Free Cash Flow *Procurement and other productivity

Klaus Kleinfeld Chairman and Chief Executive Officer [Alcoa Logo]

[Alcoa Logo] 2010 2020 6% CAGR Strong Mid- and Long-Term Aluminum Fundamentals Environment Energy consumption rising – Increase of 54% by 2025 – Driven by developing countries Personal transport rising – Increase of 40% by 2030 Greenhouse gas regulation Light Weight High Strength Durable Highly Conductive Non-Corrosive Malleable Recyclable Relative Value Demographics Urbanization The Aluminum Proposition Aluminum Demand Mega Trends Global population rising – 2006: 6.6 billion – 2025: 7.9 billion – 2050: 9.1 billion Aluminum Outlook Population in cities – 2006: > 50% – 2030: > 60% 39.2 73.0 16 EMEA Americas Asia Source: Alcoa Analysis In MMT

[Alcoa Logo] Aluminum: Key To Light Weighting Vehicles 17 Fuel Economy Improvement (MPG) Life Cycle CO 2 Emission Savings (Kilograms) Source: Alcoa Analysis, EAA, IAI Transport CAFE: Corporate Average Fuel Economy MPG Improvement Levers Powertrain Drivetrain Lightweighting Aluminum Intensive High Strength Steel Intensive Steel Baseline 2,900 Aluminum Intensive 1,050 High Strength Steel Intensive Steel Baseline CAFE Legislation 2016: 35.5 MPG Today: 25.5 MPG 3x Benefit vs. HSS 3x Benefit vs. HSS 0.0 0.0 0.9 2.7

[Alcoa Logo] 2010 2020 2030 Automotive: A 10 MMT+ Opportunity For Aluminum 18 Significant Aluminum Penetration Opportunity Source: Alcoa Analysis, The Aluminum Association, IAI Transport 17.9 Aluminum Intensive Vehicle Will Drive Aluminum Demand 7.4 KMT Automotive Aluminum Consumption (in MMT) 2020-2030: Auto Aluminum Demand Grows 40%+ Rapid Adoption of Aluminum Intensive Vehicle 10% CAGR Automotive Aluminum Consumption by Component 0 2,000 4,000 6,000 8,000 10,000 12,000 Currently Aluminum Aluminum Opportunity

[Alcoa Logo] Market Conditions in 2010 Alcoa End Markets: Current Assessment of 2010 vs. 2009 Conditions Source: Alcoa Analysis 19

[Alcoa Logo] 8% 2010 Projected Primary Aluminum Consumption by Region (in mmt) Raising 2010 Demand Growth Forecast to 12% Brazil Russia Asia w/o China North America Europe China 2009 vs. 2010 Projected Growth Rates 2010 Estimated Consumption -15% -15% -5% 16.5 4% -5% 0.9 12% *Other 9% -2% *Other consists of: Middle East, Latin America ex Brazil and Rest of World 39.2 2009 Actual 2010 Forecast 0.9 21% 20 Source: Alcoa Analysis 6% 2009 Global Demand Growth Rate: -6% 2010 Global Demand Growth Rate 12% (2010 ex China: 6.5%) 4% 4% India 2.9 1.4 -15% 14% 0%

[Alcoa Logo] Inventories Lower, Regional Premiums Higher Source: Bloomberg, IAI 54% 108% 298% $143 / MT $179 / MT $122 / MT 21 0% 50% 100% 150% 200% 250% 300% 350% 400% 450% Midwest Japan Europe Regional Premium (1-Year Change) Global Inventory Days of Consumption and Regional Premiums

[Alcoa Logo] China Western World 2010 Primary Aluminum Surplus Is Manageable Surplus Source: Alcoa estimates, Brook Hunt, CRU, CNIA, IAI 22 Surplus 2010 Annualized Production 23,950 Demand (22,750) Exports to China, Net (200) Net Surplus 1,000 2010 Annualized Production 16,500 Demand (16,500) Imports from West, Net 200 Net Surplus 200 2010E Aluminum Supply / Demand Balance (in kmt)

[Alcoa Logo] 10,000 15,000 20,000 10,000 15,000 20,000 Production SHFE China: Rationale Response To Changing Aluminum Dynamics 23 ~5.7 MMT with Cash Cost Above SHFE End of Power Subsidy Raises Costs China Aluminum Cash Cost by Province RMB/MT 15% Duty On Primary Metal = No Exports Price Falls => Curtailments Follow 27% Curtailed Trade Balance (KMT) SHFE Prem/Disc ($/MT) Source: Alcoa Analysis, CRU, CNIA, IAI (L) – Denotes low cost grid power (H) – Denotes high cost grid power 0 Production (KMT) SHFE Price ($/MT) (400) (200) 0 200 400 (400) (200) 0 200 400 China Export/(Import) SHFE Prem/(Disc) to LME 0 11,000 12,000 13,000 14,000 15,000 16,000 17,000 Cash Cost Additional Power Cost SHFE 0

[Alcoa Logo] 2010E Alumina Supply / Demand Balance (in kmt) Source: Alcoa estimates, CRU, CNIA, IAI Balanced 2010 Global Alumina in Balance China Western World 24 2010 Annualized Production 28,500 Imports from Western World 4,000 Supply 32,500 Demand (31,800) (Deficit) / Surplus 700 2010 Annualized Production 50,000 Exports to China (4,000) Supply 46,000 Demand (46,500) (Deficit) / Surplus (500)

[Alcoa Logo] 72 62 44 48 68 75 110 104 81 20 49 61 1,549 1,447 1,350 1,433 1,719 1,900 2,570 2,641 2,572 1,664 2,163 2,096 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1'10 Q2'10 Significant Value Creation From The Alumina Leader Alumina financial and strategic overview EBITDA per Metric Ton 25 Average = ~$70/MT 100% 110% 95% 105% Alcoa 3 rd Party Alumina Sales Price % LME – 18.1 MMT of capacity, including Sao Luis expansion – Low cost alumina production system – Unmatched growth potential – Ma’aden, lowest cost refinery online in 2014 Alcoa: The Alumina Leader LME EBITDA/MT

[Alcoa Logo] Driving Primary Metal To A New Profitability Level Primary Metals financial and strategic overview EBITDA per Metric Ton LME EBITDA/MT 26 Average = ~$410/MT Growing Self-Generated Energy – 4.5 MMT of capacity – Optimizing smelter portfolio; reducing costs – Ma’aden, lowest cost smelter online in 2013 – Improving cost curve position Alcoa: Poised For Profitable Growth 21% 79% 26% 74% 2010 2011 Self-Generated Long-Term Contracts 487 460 321 336 418 398 784 626 392 (159) 325 280 1,549 1,447 1,350 1,433 1,719 1,900 2,570 2,641 2,572 1,664 2,163 2,096 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1'10 Q2'10

[Alcoa Logo] Rolled Products Positioned to Substantially Improve Returns Flat Rolled Products financial and strategic overview EBITDA & EBITDA % Sales 27 573 541 495 479 531 620 536 498 254 224 107 157 EBITDA $Millions EBITDA % Sales YTD 2010 3 rd Party Sales by Market 75% Utilization 11% 11% 11% 10% 9% 9% 6% 5% 3% 4% 7% 10% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1'10 Q2'10 Distribution 13% Automotive 8% B&C 5% Commercial Transport 4% Industrial /Other 17% Packaging 42% Aerospace 11%

[Alcoa Logo] Aerospace 47% IGT 11% B&C 19% Commercial Transport 13% Automotive 4% Other 6% EPS Strong Platform for Profitable Growth Engineered Products & Solutions financial and strategic overview EBITDA & EBITDA % Sales 28 368 436 287 356 495 536 676 783 922 630 152 194 EBITDA $Millions EBITDA % Sales YTD 2010 3 rd Party Sales by Market 70% Utilization 65% Utilization 11% 11% 8% 9% 12% 11% 12% 13% 15% 13% 14% 17% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1'10 Q2'10

[Alcoa Logo] Aggressively Pursuing 2010 Operational Targets Procurement 1 Overhead $500 Total Capex 2 $1,250 Working Capital 35 2010 Cash Sustainability Operational Targets and Actual Performance $ Millions $311 $514 42 $ Millions $ Millions Days Working Capital $2,500 $1,414 2010 YTD 2010 Target 2010 YTD 2010 Target 2010 YTD 2010 Target 2010 YTD 2010 Target 1 Procurement and other productivity 2 Total Capex includes investments in Ma’aden project 29

[Alcoa Logo] Alcoa Is Driving Value Today And Over The Long-Term 30 – Global alumina leader leveraging production base – Global aluminum leader reducing cost position – Alcoa Rolled Products leading revitalization – EPS expanding market leadership and profitability Alcoa: Driving Value Alcoa Performance Strengthening (EBITDA Margin) Long-term Drivers Remain Intact 20% 17% 15% 14% 14% 13% 19% 16% 12% 2% 12% 14% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1'10 Q2'10 Strong Mid - and Long -Term Aluminum Fundamentals Environment Energy consumption rising –Increase of 54% by 2025 –Driven by developing countries Personal transport rising –Increase of 40% by 2030 Greenhouse gas regulation Light Weight High Strength Durable Highly Conductive Non-Corrosive Malleable Recyclable Relative Value Demographics Urbanization The Aluminum Proposition Aluminum Demand Mega Trends Global population rising –2006: 6.6 billion –2025: 7.9 billion –2050: 9.1 billion Aluminum Outlook Population in cities –2006: > 50% –2030: > 60% 2010 2020 6% CAGR 39.2 73.0 16 EMEA Americas Asia Source: Alcoa Analysis In MMT low cost profitability

[Alcoa Logo] Matthew E. Garth Director, Investor Relations 390 Park Avenue New York, NY 10022-4608 Telephone: (212) 836-2674 www.alcoa.com Additional Information 31 [Alcoa Logo]

[Alcoa Logo] * * * * * * * * * * * *

[Alcoa Logo] Annual Sensitivity Summary 33 LME Aluminum Annual Net Income Sensitivity Currency Annual Net Income Sensitivity +/- 10% versus USD Australian $ +/- $75 million Brazilian $ +/- $50 million Euro € +/- $40 million Canadian $ +/- $35 million +/- $100/MT = +/- $200 million

[Alcoa Logo] Effective Tax Rate Effective tax rate, excluding discrete tax items is a non-GAAP financial measure. Management believes that the Effective tax rate, excluding discrete tax items is meaningful to investors because it provides a view of Alcoa’s operational tax rate. 34 $ Millions 1Q’10 2Q’10 (Loss) income from continuing operations before income taxes ($88) $228 Provision for income taxes $84 $57 Effective tax rate as reported (95.5%) 25.0% Discrete tax provisions: Medicare Part-D $79 -- Transaction-related and other items $33 ($16) Subtotal - Discrete tax (benefits) provisions $112 ($16) (Benefit) Provision for income taxes excluding discrete tax (benefits) provisions ($28) $73 Effective tax rate excluding discrete tax (benefits) provisions 31.8% 32.0%

[Alcoa Logo] Reconciliation of ATOI to Consolidated Net (Loss) Income Attributable to Alcoa 35 (in millions) 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 Total segment ATOI $ (143) $ (132) $ 142 $ (101) $ (234) $ 306 $ 381 Unallocated amounts (net of tax): Impact of LIFO 29 39 80 87 235 (14) (3) Interest income 1 8 (1) 4 12 3 3 Interest expense (74) (75) (78) (79) (306) (77) (77) Noncontrolling interests (10) 5 (47) (9) (61) (22) (34) Corporate expense (71) (70) (71) (92) (304) (67) (59) Restructuring and other charges (46) (56) (3) (50) (155) (122) (21) Discontinued operations (17) (142) 4 (11) (166) (7) (1) Other (166) (31) 51 (26) (172) (201) (53) Consolidated net (loss) income attributable to Alcoa $ (497) $ (454) $ 77 $ (277) $ (1,151) $ (201) $ 136

[Alcoa Logo] Reconciliation of Adjusted Income 36 (in millions) Quarter ended March 31, 2010 June 30, 2010 Net (loss) income attributable to Alcoa $ (201) $ 136 Loss from discontinued operations (7) (1) (Loss) income from continuing operations attributable to Alcoa (194) 137 Restructuring and other charges 119 20 Discrete tax items* 112 (16) Special items** 64 (2) Income from continuing operations attributable to Alcoa – as adjusted $ 101 $ 139 Income from continuing operations attributable to Alcoa – as adjusted is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because management reviews the operating results of Alcoa excluding the impacts of restructuring and other charges, discrete tax items, and special items. There can be no assurances that additional restructuring and other charges, discrete tax items, and special items will not occur in future periods. To compensate for this limitation, management believes that it is appropriate to consider both (Loss) income from continuing operations attributable to Alcoa determined under GAAP as well as Income from continuing operations attributable to Alcoa – as adjusted. * Discrete tax items include the following: a benefit for a change in a Canadian provincial tax law permitting tax returns to be filed in U.S. dollars ($24), a charge based on settlement discussions of several matters with international taxing authorities ($18), and a benefit for the recovery of a portion of the unfavorable impact included in the quarter ended March 31, 2010 related to unbenefitted losses in Russia, China, and Italy ($10); and charges for a change in the tax treatment of federal subsidies received related to prescription drug benefits provided under certain retiree health benefit plans ($79), unbenefitted losses in Russia, China, and Italy ($22)(expected to reverse by the end of 2010), interest due to the IRS related to a previously deferred gain associated with the 2007 formation of the former soft alloy extrusions joint venture ($6), and a change in the anticipated sale structure of the Transportation Products Europe business ($5) for the quarter ended March 31, 2010. ** Special items include the following: favorable mark-to-market changes in derivative contracts ($22), a charge for costs associated with the potential strike and successful execution of a new agreement with the USW ($13), and a charge related to an unfavorable decision in Alcoa’s lawsuit against Luminant related to the Rockdale, TX facility ($7); and charges related to unfavorable mark-to-market changes in derivative contracts ($31), power outages at the Rockdale, TX and São Luís, Brazil facilities ($17), an additional environmental accrual for the Grasse River remediation in Massena, NY ($11), and the write off of inventory related to the permanent closures of certain U.S. facilities ($5) for the quarter ended March 31, 2010.

[Alcoa Logo] Reconciliation of Free Cash Flow 37 (in millions) Quarter ended June 30, 2010 Cash provided from operations $ 300 Capital expenditures (213) Free cash flow $ 87 Free Cash Flow is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because management reviews cash flows generated from operations after taking into consideration capital expenditures due to the fact that these expenditures are considered necessary to maintain and expand Alcoa’s asset base and are expected to generate future cash flows from operations. It is important to note that Free Cash Flow does not represent the residual cash flow available for discretionary expenditures since other non-discretionary expenditures, such as mandatory debt service requirements, are not deducted from the measure.

[Alcoa Logo] Reconciliation of Alcoa EBITDA 38 ($ in millions) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 1Q10 2Q10 Net income (loss) attributable to Alcoa $ 1,484 $ 908 $ 420 $ 938 $ 1,310 $ 1,233 $ 2,248 $ 2,564 $ (74) $ (1,151) $ (201) $ 136 Add: Net income attributable to noncontrolling interests 306 205 181 212 233 259 436 365 221 61 22 34 Cumulative effect of accounting changes 5 – (34) 47 – 2 – – – – – – (Income) loss from discontinued operations (73) 5 101 – 27 50 (22) 250 303 166 7 1 Provision (benefit) for income taxes 859 524 307 367 546 464 853 1,623 342 (574) 84 57 Other (income) expenses, net (136) (295) (175) (278) (266) (478) (236) (1,920) (59) (161) 21 (16) Interest expense 427 371 350 314 271 339 384 401 407 470 118 119 Restructuring and other charges (1) 530 398 (28) (29) 266 507 268 939 237 187 30 Provision for depreciation, depletion, and amortization 1,123 1,144 1,037 1,110 1,142 1,227 1,252 1,244 1,234 1,311 358 363 Earnings before interest, taxes, depreciation, and amortization (EBITDA) $ 3,994 $ 3,392 $ 2,585 $ 2,682 $ 3,234 $ 3,362 $ 5,422 $ 4,795 $ 3,313 $ 359 $ 596 $ 724 Sales $19,947 $19,906 $17,691 $18,879 $21,370 $24,149 $28,950 $29,280 $26,901 $18,439 $ 4,887 $ 5,187 EBITDA/ Sales (EBITDA Margin ) 20% 17% 15% 14% 15% 14% 19% 16% 12% 2% 12% 14% Alcoa’s definition of EBITDA is net margin plus an add -back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development expenses; and Provision for depreciation, depletion, and amortization. EBITDA is a non -GAAP financial measure. Management believes that this measure is meaningful to investors because EBITDA provides additional information with respect to Alcoa’s operating performance and the Company’s ability to meet its financial obligations. The EBITDA presented may not be comparable to similarly titled measures of other companies.

[Alcoa Logo] Reconciliation of Alumina EBITDA 39 ($ in millions) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 1Q10 2Q10 Alumina After-tax operating income (ATOI) $ 585 $ 471 $ 315 $ 415 $ 632 $ 682 $ 1,050 $ 956 $ 727 $ 112 $ 72 $ 94 Add: Depreciation, depletion, and amortization 163 144 139 147 153 172 192 267 268 292 92 107 Equity (income) loss (3) (1) (1) – (1) – 2 (1) (7) (8) (2) (4) Income taxes 279 184 130 161 240 246 428 340 277 (22) 27 41 Other (12) (17) (14) (55) (46) (8) (6) 2 (26) (92) 1 (2) Earnings before interest, taxes, depreciation, and amortization (EBITDA) $ 1,012 $ 781 $ 569 $ 668 $ 978 $ 1,092 $ 1,666 $ 1,564 $ 1,239 $ 282 $ 190 $ 236 Production (thousand metric tons) (kmt) 13,968 12,527 13,027 13,841 14,343 14,598 15,128 15,084 15,256 14,265 3,866 3,890 EBITDA/Production ($ per metric ton) 72 62 44 48 68 75 110 104 81 20 49 61 Alcoa’s definition of EBITDA is net margin plus an add -back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development expenses; and Provision for depreciation, depletion, and amortization. The Other line in the table above includes gains/losses on asset sales and other nonoperating items. EBITDA is a non -GAAP financial measure. Management believes that this measure is meaningful to investors because EBITDA provides additional information with respect to Alcoa’s operating performance and the Company’s ability to meet its financial obligations. The EBITDA presented may not be comparable to similarly titled measures of other companies.

[Alcoa Logo] Reconciliation of Primary Metals EBITDA 40 ($ in millions) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 1Q10 2Q10 Primary Metals After-tax operating income (ATOI) $ 1,000 $ 905 $ 650 $ 657 $ 808 $ 822 $ 1,760 $ 1,445 $ 931 $ (612) $ 123 $ 109 Add: Depreciation, depletion, and amortization 311 327 300 310 326 368 395 410 503 560 147 142 Equity (income) loss (50) (52) (44) (55) (58) 12 (82) (57) (2) 26 – (1) Income taxes 505 434 266 256 314 307 726 542 172 (365) 18 – Other (41) (8) (47) 12 20 (96) (13) (27) (32) (176) 1 – Earnings before interest, taxes, depreciation, and amortization (EBITDA) $ 1,725 $ 1,606 $ 1,125 $ 1,180 $ 1,410 $ 1,413 $ 2,786 $ 2,313 $ 1,572 $ (567) $ 289 $ 250 Production (thousand metric tons) (kmt) 3,539 3,488 3,500 3,508 3,376 3,554 3,552 3,693 4,007 3,564 889 893 EBITDA/Production ($ per metric ton) 487 460 321 336 418 398 784 626 392 (159) 325 280 Alcoa’s definition of EBITDA is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development expenses; and Provision for depreciation, depletion, and amortization. The Other line in the table above includes gains/losses on asset sales and other nonoperating items. EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because EBITDA provides additional information with respect to Alcoa’s operating performance and the Company’s ability to meet its financial obligations. The EBITDA presented may not be comparable to similarly titled measures of other companies.

[Alcoa Logo] Reconciliation of Flat-Rolled Products EBITDA 41 ($ in millions) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 1Q10 2Q10 Flat-Rolled Products After-tax operating income (ATOI) $ 296 $ 253 $ 225 $ 222 $ 254 $ 278 $ 233 $ 178 $ (3) $ (49) $ 30 $ 71 Add: Depreciation, depletion, and amortization 153 167 184 190 200 220 223 227 216 227 59 57 Equity (income) loss (3) 2 4 1 1 – 2 – – – – – Income taxes 126 124 90 71 75 121 58 92 35 48 18 28 Other 1 (5) (8) (5) 1 1 20 1 6 (2) – 1 Earnings before interest, taxes, depreciation, and amortization (EBITDA) $ 573 $ 541 $ 495 $ 479 $ 531 $ 620 $ 536 $ 498 $ 254 $ 224 $ 107 $ 157 Total sales $ 5,167 $ 4,868 $ 4,571 $ 4,768 $ 6,042 $ 7,081 $ 8,610 $ 9,597 $ 9,184 $ 6,182 $ 1,481 $ 1,614 EBITDA/Total sales 11% 11% 11% 10% 9% 9% 6% 5% 3% 4% 7% 10% Alcoa’s definition of EBITDA is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development expenses; and Provision for depreciation, depletion, and amortization. The Other line in the table above includes gains/losses on asset sales and other nonoperating items. EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because EBITDA provides additional information with respect to Alcoa’s operating performance and the Company’s ability to meet its financial obligations. The EBITDA presented may not be comparable to similarly titled measures of other companies.

[Alcoa Logo] Reconciliation of Engineered Products and Solutions EBITDA 42 ($ in millions) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2Q09 1Q10 2Q10 Engineered Products and Solutions After-tax operating income (ATOI) $ 125 $ 189 $ 63 $ 124 $ 156 $ 271 $ 365 $ 435 $ 533 $ 315 $ 88 $ 81 $ 107 Add: Depreciation, depletion, and amortization 165 186 150 166 168 160 152 163 165 177 46 41 38 Equity (income) loss (1) – – – – – 6 – – (2) – (1) – Income taxes 79 61 39 55 65 116 155 192 222 139 40 31 48 Other – – 35 11 106 (11) (2) (7) 2 1 (1) – – Earnings before interest, taxes, depreciation, and amortization (EBITDA) $ 368 $ 436 $ 287 $ 356 $ 495 $ 536 $ 676 $ 783 $ 922 $ 630 $ 173 $ 152 $ 193 Total sales $ 3,386 $ 4,141 $ 3,492 $ 3,905 $ 4,283 $ 4,773 $ 5,428 $ 5,834 $ 6,199 $ 4,689 $ 1,194 $ 1,074 $ 1,122 EBITDA/Total sales 11% 11% 8% 9% 12% 11% 12% 13% 15% 13% 14% 14% 17% Alcoa’s definition of EBITDA is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; Research and development expenses; and Provision for depreciation, depletion, and amortization. The Other line in the table above includes gains/losses on asset sales and other nonoperating items. EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because EBITDA provides additional information with respect to Alcoa’s operating performance and the Company’s ability to meet its financial obligations. The EBITDA presented may not be comparable to similarly titled measures of other companies.