Slide 1: 1st Quarter 2005 Analyst Conference
Exhibit 99.2 1st Quarter April 6, 2005 2005 Analyst Conference
Slide 2: Forward-Looking Statements
Forward-Looking Today’s involve factors Securities 2 that known discussion and could Exchange andcause Statements may unknown results include Commission. risks to“forward-looking differ and uncertainties. materially statements” from Alcoa’s thoseactual expressed withinresults theinmeaning or theacti
Slide 3: Richard B. Kelson, Executive Vice President and Chief Financial Officer
Richard B.Vice Executive Kelson President Chief Financial Officer
Slide 4: 1st Quarter Financial Overview
1st Quarter Income Financial sequentially 4 fromOverview tocontinuing $6.3 billion operations Regainedoftraction $0.31/share on cost Income savings from initiative continuing On aoperations sequential included basis, four $0.09/share of six segments for Russia achieved integration, double-digit Elke
Slide 5: 1st Quarter Restarts Growth Overview
1st Quarter Restarts Growth Telecommunications Continued Restructuring 5 at ABI, progress restructuring Overview Wenatchee ontransaction projects to streamline and in Massena Divested Australia, operations Integris Brazil,and China, accepted Iceland, tender Jamaica, offer for andElkem Suriname share
Slide 6: LWD Safety Rate
LWD Safety 0.6 1996 0.075 0.07 0.09 0.12 0.15 0.16 0.18 0.23 0.36 0.46 0.49 24 Rate 6 LWD 0.4 (injuries 1997 Incident 0.2 in1998 0.0 66per Rate million 1999 200,000 2000 hours hrs. 2001 worked worked) 2002 in 2003 2005 Excludes 2004recently 2005YTD acquired 2005 Milestone locations
Slide 7: 1st Quarter Financial Overview
1stof In LME Sales Cost SG&A % Restructuring Other Effective Minority Income GAAP 7 Millions Quarter of Sales 3-Month $6,041 Income, Net Income $336 Goods (Loss) Interests Tax 80.8% 5.6% Income 2005 4Q04 $6,289 Rate and 333 Net Sold from Average From 5.3% Financial 1Q05 79.2% Other $48 14% (Gain) $
Slide 8: 1st Quarter Cash Flow Review
1stInQuarter $ Net DD&A Change Dividends Acquisitions Other Cash Capital 120% 1Q’04 Growth 8 Income Millions From Adjustments Financing Investing 100% 1Q’05 Expenditures 301 in projects Working toInvesting Operating Financing 2005 320 355 80% 0Shareholders 1Q’04 (434) Activities 260 Non-Growth Activ
Slide 9: Corporate Actions: Tendered Elkem Transaction
Corporate Tendered Elkem Transaction 1. 2. Two Russia Approximately AFL Complete Completed Integris 9 $39M ~ $220M fabricating Automotive loss 46.5% ownership Actions sale gain will recognized $80 for facilities result stake to approximately be million obtained for recognized in in after-tax acquire
Slide 10: Restructuring Objective and Scope
Restructuring Improve Objective Pre Scope 1Q Businesses: Targeting Benefits 10 Restructuring Tax/Minority production $45 AFL Charges million Automotive, Net Charge($ efficiencies Income beforemm) tax Packaging, and savings 45 25 lower annually Primary, overall cost and structure Mill Products of key
Slide 11: Regained Traction on Cost Savings
2006 Regained Overcame ($27) ($7) Annual 1Q 11 ‘04Cost $15 2Q run traction $21 Savings $31 ‘04 ratemillion 3Q ofin ‘04 $84 Challenge net4Q in million cost cost ‘04savings increases 1Q ‘05 Quarterly Q1 versus RunQ4Rate $27 $13
Slide 12: Segment Realignment
Alignment Unchanged Alumina New Extruded Global Engineered Howmet Wheels 12 Segments Realignment Extrusions and Alcoa Primary and along Solutions Segments Forged End Fasteners global Metals Products and Products End businesses Flat Products AFL Rolled Automotive led Alcoa Products to segment Home Pa
Slide 13: 1st Quarter Revenue Change
1st Quarter Revenue Other Market Building Change Realized Alumina Primary 3rd Aerospace Automotive Commercial B&C Industrial Packaging Note: 13 Party 14% Packaging (Distr., Conditions from Products 14% Prices by 14% &Revenue Products 24% 8% 7% 10% 15% Market Construction Market 11% -5% Transportatio
Slide 14: Alumina
Bauxite Alumina 3rd Markets Intersegment Current ATOI 180 LME -9% +27% 90 1Q04 Higher Positives Continued Negatives 14 85 Party 155 Cent/Lb 2Q04 80 Performance expected Business mining 130 75 Revenue high 3Q04 70 105 Revenue and caustic prices 80 Conditions 4Q04 $alumina Millions based soda 1Q05cost
Slide 15: Primary Metals
Primary 4.0 3rd Markets Intersegment ATOI + LME +14% 90 1Q Current Positives Continued Negatives 1517% 85 04 million Party Cent/Lb 80 Performance 2QBusiness Metals 75 Revenue 04 strong higher mt 70 3Q Revenue of 04 smelting Conditions metal carbon, $4Q04 Millions prices energy 1Q05 capacity, ABI, 28
Slide 16: Flat Rolled Products
Flat Aluminum Distribution Markets Building Commercial Can Auto Aero ATOI 75 + 1Q04 +27% Current Continued Positives Typical Higher Negatives 1614% 70Rolled Sheet 2Q04 65 Performance input seasonal Business 60 &strong sheet Products Construction 3Q04 55 & Vehicle costs Other 50demand and Conditions
Slide 17: Extruded and End Products
Extruded Hard- Distribution Markets Building Commercial Aero Auto ATOI 30 1Q04 NA -12% Current Continued Positives European Negatives 17 20 2Q04 10 Performance and Business 0& and markets soft-alloy strength -10 Construction 3Q04 & Vehicle End Other Conditions 4Q04 Products remain $inextrusions, Mil
Slide 18: Engineered Solutions
Engineered Solutions Commercial IGT Markets Industrial Aero ATOI Auto 70 1Q04 +44% -5% Current Continued Positives Lower Negatives 18 60 2Q04 50 Performance build Business 40 used &strength Solutions 3Q04 30 Other rates Vehicle in Conditions the announced 4Q04 $inautomotive, Millions aerospace 1Q05b
Slide 19: Packaging and Consumer
Packaging Flexible Markets Food Consumer ATOI Closures 60 1Q04 -42% -37% Current Seasonal Positives Persistently Negatives 19 50 Packaging 2Q04 40 Performance Business Packaging 30 up-tick products, Products &high 3Q04 20 Consumer 10in oil Conditions 4Q04 0$Closures &prices closures, Millions Other
Slide 20: 2Q '05 Outlook Summary
Outlook 2Q Alumina Positives building Continued Negatives 20 ‘05 Outlook Summary and and input construction, primary cost pressure metalcan prices (energy, sheet, remain closures caustic, highand carbon, Restarts consumer resin) in primary products GM and metals Fordwill build contribute rates decli
Slide 21: Bernt Reitan, Group President, Primary Products
Bernt Reitan Executive Vice President – Alcoa Group President, Primary Products
Slide 22: Global Demographics Drive Demand
Global Dissimilar Demographics Percentage 60 70 40 20 1 0 Source: 22950 501955 30 10 Trends World United world 1960 of Population will Resources Nations 1965 population Drive 1970 Demand in Institute 1975 Urban growth 1980 Growth Areas Urbanization 1985 1990 intensity 1995 2000Longevity 2003 2005 &
Slide 23: Globalization Will Drive Aluminum Demand
Global Globalization Estimated (2003 50000 2003 80 Indonesia China Source: 23 70per 60 US$bn) US Brasil 45000 Trends Economic Goldman IAI, 50 Capita India GDP40 Alcoa Thailand 40000 will 30 by Japan Aluminum Growth Sachs 20 Country Drive analysis 35000 10 Brazil Russia “Growth 0Demand Dynamism 30000
Slide 24: Strong Near-term Consensus Fundamentals
Strong Near-term Consensus Alumina Aluminum 2005 S 0 (500) (100) (200) (400) 2007 2006 (kmt) 24ource:Fundamentals Consensus, Deficit Growth view Deficitof global Alcoa through demand 2006growth at 5.2% in ‘05 and 4.2% in ‘06 Developing economies (BRIC’s) and strong NA economy driving growth
Slide 25: Escalating Smelter Costs
Escalating 2400 0 Source: 2004 Alcoa 2003 Worldwide 255000Historical 2200 Current Global 10000 2004 Industry 2000 Smelter Capacity Alcoa, Costs 15000 Costs 1800 Costs Cash 2003 -20000 1600 000Costs CRU MT 1400- 2003 25000 1200 30000 and 1000 35000 Current 800 600$ per MT
Slide 26: Managing Alumina and Smelting Productivity
Managing Alumina 1.08 1.06 1.03 Smelting Indexed 2001 1.19 1.16 1.05 1.0 26 1.07 1.14 2002 to 1.13 1.22 Production Productivity Production Productivity the 2001 2003 1.17 1.34 System -Continuously 2004Improvement Improvement Improvement Improvement operating smelters
Slide 27: Active Refining and Smelting Growth Project Update
Active Refining Suralco Pinjarra Smelting Sao Iceland Norway 27 Luis Upstream 322 250 657 Anodes Project 63 Project kmt kmt kmtStarting In Capacity Civil Completed, Capacity Overall Growth the and process construction project Project Status Status structural five ofprogress Update months procuring w
Slide 28: Alcoa's Strong Current Value and Our Opportunity
Alcoa’s Strong Our Safety Enhanced 28 Focus and underlying Upstream revenue environmental Opportunity growth throughcompliance dynamics value added Current Operational products strong Value excellence market creating fundamentals through growthABS opportunities Creep Productivity improvements Cost c
Slide 29: For Additional Information, contact
For Additional William 390 Alcoa New 29 Park York, F.Avenue Oplinger N.Y.Information, 10022-4608 Director,contact: Telephone: Investor Relations (212) 836-2674 Facsimile: (212) 836-2813 www.alcoa.com
Slide 30: Appendix
ALCOA Appendix
Slide 31: Return on Capital Reconciliation
Reconciliation In Method Net Interest Numerator (After-tax) ST LT Preferred Minority Common (Sum Denominator ROC Note: Notes: 31 Millions Borrowings Income 7.8% Total) Bloomberg Expense 1Q’04 Interest Equity 6.9% 1Q’05 $1,215 $1,673 $21,377 of Annlzd $6,025 $1,269 $55 $206 $12,766 8.4% $252 $1,263 R