EX-99.2 3 d203332dex992.htm EX-99.2

Update on Alcoa’s Separation: Filing of Initial Form 10 June 29, 2016 1 Exhibit 99.2

Important Information 2 Forward–Looking Statements This presentation contains statements that relate to future events and expectations and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those containing such words as “anticipates,” “believes,” “could,” “estimates,” “expects,” “forecasts,” “goal,” “intends,” “may,” “outlook,” “plans,” “projects,” “seeks,” “sees,” “should,” “targets,” “will,” “would,” or other words of similar meaning. All statements that reflect Alcoa’s expectations, assumptions or projections about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, forecasts concerning global demand growth for aluminum and bauxite and statements regarding the separation transaction. Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and changes in circumstances that are difficult to predict. Although Alcoa believes that the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that these expectations will be attained and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties. Such risks and uncertainties include, but are not limited to: (a) uncertainties as to the timing of the separation and whether it will be completed; (b) the possibility that various closing conditions for the separation may not be satisfied; (c) the outcome of contingencies, including legal proceedings; (d) the impact of the separation on the businesses of Alcoa; (e) the risk that the businesses will not be separated successfully or such separation may be more difficult, time-consuming or costly than expected, which could result in additional demands on Alcoa’s resources, systems, procedures and controls, disruption of its ongoing business and diversion of management’s attention from other business concerns; (f) material adverse changes in aluminum industry conditions, including global supply and demand conditions and fluctuations in London Metal Exchange-based prices and premiums, as applicable, for primary aluminum, alumina, and other products, and fluctuations in indexed-based and spot prices for alumina; (g) deterioration in global economic and financial market conditions generally; and (h) the other risk factors discussed in Alcoa’s Form 10-K for the year ended December 31, 2015, and other reports filed with the U.S. Securities and Exchange Commission (SEC). Alcoa disclaims any obligation to update publicly any forward-looking statements, whether in response to new information, future events or otherwise, except as required by applicable law. Market projections are subject to the risks discussed above and other risks in the market.

Topics for Today’s Discussion 3 What We Will Cover Today and What We Will Cover in the 2Q 2016 Earnings Call What we will cover today Timeline for the separation An overview of the initial Form 10 filed What we will cover in the 2Q earnings call Quarterly results 3Q16 outlook Overview of longer term market trends and performance

Current Form 10 Focuses on Carve-Out Financials; Pro-Forma Details to Follow 4 Form 10 Content: Current and Future Financial information included in the current filing Carve-out financials for Alcoa Corporation May not reflect Alcoa Corporation’s combined results of operations, financial position and cash flows had it been a standalone company during the periods presented Include general corporate expenses of Alcoa Inc. that were not historically charged to Upstream business Expenses allocated based on direct usage (where possible) and relative segment revenue Pension / OPEB pro-forma adjustments presented Additional adjustments will be included in later filings What we will include in subsequent amendments Additional pro-forma adjustments Statement of Combined Operations Balance Sheet Capital structure Alcoa Corporation’s board of directors

Klaus Kleinfeld Chairman and Chief Executive Officer 5 June 29, 2016

Executing Separation – Achieving a Key Milestone with Initial Form 10 Filing 6 Separation Approximate Timeline and Path to Completion 4Q 2015 1 st Half 2016 2 nd Half 2016 Launched New Value-Add Name and Brand and Refreshed Alcoa Brand Initial Form 10 Filing - e.g., – 3-Year Carve-Out Financials – Form of Separation and Legal Structure – Intended Debt Structure – Allocation of Assets and Liabilities – Governance Elements Separate Supplier/Partner Contracts Form 10 Effectiveness and Final Board Approval Complete Separation of IT Systems and Infrastructure Complete Financing Begin Trading as Two Companies Launched the Separation Program Office Announced the Executive Management Teams Confirmed U.S. Domicile for Both Companies Launched New Business Improvement Programs for 2016 – Arconic to Deliver $650M – Alcoa Corporation to Deliver $600M – Above Includes Overhead Reductions Across Alcoa ($100M in 2016, $225M over two years) 1) $50M of $100M to be realized in 2016 comes from Arconic, remaining $50M from Alcoa Corporation. 1

Alcoa Inc.’s debt remains with Arconic 1 (Remain Co); Alcoa Corp. to raise approx. $1 billion Estimated Pro Forma Pension/OPEB obligation 2 : Alcoa Corporation $2.6B, Arconic $3.0B Alcoa Corporation (New Co) will be listed on the NYSE through a tax-free spinoff to shareholders 7 In light of volatile commodity and debt markets, Arconic to retain up to 19.9% of Alcoa Corporation Executing Separation – Form 10 Highlights Separation on track for 2nd half 2016 1) Except for BNDES loans; refer to the Form 10 for additional details 2) As of March 31, 2016

Arconic: Premier Provider of Innovative Solutions to Growing Markets 8 Aerospace and Automotive Products Brazing, Commercial Transportation and Industrial Micromill™ Products and Services Power and Propulsion Fastening Systems and Rings Forgings and Extrusions Titanium and Engineered Products Building and Construction Systems Wheel and Transportation Products Key Attributes Premier supplier of high-performance advanced multi-material products and solutions Positioned to strengthen in growth markets with significant customer synergies e.g., aerospace and automotive Expanded multi-material, technology and process expertise Innovation leader with full pipeline of products and solutions Successfully shifting product mix to higher value-add Robust margins and investment opportunities above cost of capital Arconic Business Operations and Key Attributes GRP EPS TCS

Alcoa Corporation: Cost Competitive Industry Leader 9 1) CRU analysis 2) Mined in 2015, including equity interests 3) CRU and Alcoa analysis 4) Includes Saudi Arabia Joint Venture BDMT = Bone Dry Metric Ton Alcoa Corporation Business Operations and Key Attributes Key Attributes Robust projected aluminum demand growth of 5% in 2016, doubling between 2010 and 2020; 3 rd Party bauxite demand projected to double by 2025 Attractive Portfolio: World’s largest, low cost bauxite miner at the 1 st quartile 1 on the cost curve (45M BDMT 2 ) World’s largest, most attractive alumina business in the 1 st quartile 3 of the cost curve (17.3 MMT total capacity) Substantial energy assets with operational flexibility (Power production capacity of 1,685 MW) Optimized smelting capacity (3.1 MMT) continuing to improve its 2 nd quartile 3 cost curve position 18 casthouses 4 and 2 rolling mills providing value-add products Diverse sites – close proximity to major markets Committed to disciplined capital allocation and prudent return of capital to shareholders Cast Products World’s largest bauxite miner 1 1 st quartile 3 cost curve refiner Flexibility to profit from market cycles Strategic global footprint Value-add products in key markets Rolled Products Aluminum Energy Alumina Bauxite Can sheet leader in N.A.

10 Separation Process Overview Will trade on the New York Stock Exchange under the ticker “AA” “New Co.” Will trade on the New York Stock Exchange under the ticker “ARNC” “Remain Co.” Alcoa Corporation to be Created as a New Company Guiding Principles Create optimal capital structures for both entities Pension / OPEB Debt restrictions Optimize opportunities for financing Minimize separation costs Debt breakage Financing Tax Minimize execution risks

Intended Capital Structure Creates Strong Balance Sheets for Both Co.’s 11 Intended Capital Structure Overview Guiding principles for new capital structures Create the strongest balance sheets possible for both entities to optimize financing opportunities Minimize debt breakage and other financing costs e.g., refinancing of legacy parent entity Arconic (Remain Co.) Alcoa Inc.’s debt remains with Arconic 1 Arconic uses cash received from Alcoa Corporation to pay down a portion of the debt retained from Alcoa Inc. Arconic not expected to issue debt Alcoa Corporation (New Co.) Conducts a capital raise of approximately $1B in funded debt Proceeds, net of fees, will be used to pay Arconic Obtains up to ~$1.5B of liquidity facilities through a senior secured revolving credit facility Intended capital structure 1) Except for BNDES loans; refer to the Form 10 for additional details

80/20 Structure Description Retained Interest: Both Companies Positioned for Success 12 ...Arconic to retain up to 19.9% of Alcoa Corporation In light of recent volatile commodity markets and conditions in the high-yield debt market... Provides Arconic a liquid security that can be monetized to strengthen the balance sheet Reduces reliance on Alcoa Corporation to raise debt Enables Alcoa Corporation to be separated with lower leverage Filed for IRS private letter ruling Alcoa Corporation Shares Outstanding Ownership Barclays U.S. Corporate High Yield Average OAS 1 (% pts.) (6/20/11-6-16/16) 1) OAS = Option-Adjusted Spread Source: Bloomberg All-in Aluminum (LME Cash + Midwest Premium) ($/MT) (6/20/11-6/16/16) Recent historic lows 1,500 1,700 1,900 2,100 2,300 2,500 2,700 2,900 06/11 12/11 06/12 12/12 06/13 12/13 06/14 12/14 06/15 12/15 3 4 5 6 7 8 9 80.1% 19.9% Free float Arconic Alcoa Inc. conducts a pro rata distribution of at least 80.1% of the outstanding shares We continue to monitor market conditions in the commodity and high-yield debt market and to assess the impact of that situation on how to structure the transaction 06/11 12/11 06/12 12/12 06/13 12/13 06/14 12/14 06/15 12/15

13 Liability Allocation Overview “Remain Co.” Liabilities Allocated to Each Entity According to Several Guiding Principles Legal Environmental Pension / OPEB Liabilities “New Co.” Guiding Principles Legal and Environmental Allocated generally to originating business e.g., Grasse River to Arconic and Fusina to Alcoa Corporation Pension / OPEB 1 Allocated to employee’s last business affiliation Closed / divested / HQ allocated to balance funding level and contribution requirements 1) Estimated Pro Forma Pension/OPEB obligation as of March 31, 2016: Alcoa Corporation $2.6B, Arconic $3.0B

Executing Separation – On Course for Second Half of 2016 14 Separation Approximate Timeline and Path to Completion 1) $50M of $100M to be realized in 2016 comes from Arconic, remaining $50M from Alcoa Corporation. 4Q 2015 1 st Half 2016 2 nd Half 2016 Launched New Value-Add Name and Brand and Refreshed Alcoa Brand Initial Form 10 Filing - e.g., – 3-Year Carve-Out Financials – Form of Separation and Legal Structure – Intended Debt Structure – Allocation of Assets and Liabilities – Governance Elements Separate Supplier/Partner Contracts Form 10 Effectiveness and Final Board Approval Complete Separation of IT Systems and Infrastructure Complete Financing Begin Trading as Two Companies Launched the Separation Program Office Announced the Executive Management Teams Confirmed U.S. Domicile for Both Companies Launched New Business Improvement Programs for 2016 – Arconic to Deliver $650M – Alcoa Corporation to Deliver $600M – Above Includes Overhead Reductions Across Alcoa ($100M in 2016, $225M over two years) 1

Get Ready for The Launch of Two Strong, New Companies 15 Arconic and Alcoa Corporation Branding

16