Slide 1: First Quarter Earnings Conference
Exhibit 99.2 st Quarter Earnings Conference April 10 th , 2012
Slide 2: Cautionary Statement
Cautionary Statement [Alcoa logo] This presentation contains statements that relate to future events and expectations and as such constitute forward-looking statements. Forward-looking statements include those containing such words as “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “o
Slide 3: Chuck McLane, Executive Vice President and Chief Financial Officer
Chuck McLane Executive Vice President and Chief Financial Officer
Slide 4: 1st Quarter 2012 Financial Overview
1 st Quarter 2012 Financial Overview [Alcoa logo] Income from Continuing Operations of $94 million, or $0.09 per share; Excluding impact of restructuring and other special items : Income from continuing operations of $105 million, or $0.10 per share Revenue at $6.0 billion Cash Sustainability action
Slide 5: Income Statement Summary
Income Statement Summary [Alcoa logo] $ Millions, except per-share amounts 1Q’11 4Q’11 1Q’12 Year Change Sequential Change Sales $5,958 $5,989 $6,006 $48 $17 Cost of Goods Sold $4,715 $5,228 $5,098 $383 ($130) COGS % Sales 79.1% 87.3% 84.9% 5.8 % pts. (2.4 % pts.) Selling, General Administrative, Ot
Slide 6: Restructuring and Other Special Items
Restructuring and Other Special Items [Alcoa logo] $ Millions, except per-share amounts 1Q’11 4Q’11 1Q’12 Income (Loss) from Continuing Operations $309 ($193) $94 Income (Loss) Per Diluted Share $0.27 ($0.18) $0.09 Restructuring Related ($5) ($159) ($7) Discrete Tax Items - ($12) - Mark-to-Market En
Slide 7: 1st Quarter 2012 vs. 4th Quarter 2011 Earnings Bridge
1 st Quarter 2012 vs. 4 th Quarter 2011 Earnings Bridge 18 ( 20 ) ( 12 ) ( 15 ) 108 34 29 [Alcoa logo] See appendix for Adjusted Income (Loss) reconciliation Income (Loss) from Continuing Operations Excluding Restructuring & Other Special Items ($ millions) $17m +$171m -$49m LME 4Q 2011 ( 34 ) Cost
Slide 8: Alumina
Alumina 1 st Quarter Results 2 nd Quarter Outlook 1 st Quarter Business Highlights 1 st Quarter Performance Bridge [Alcoa logo] 1Q 11 4Q 11 1Q 12 Production (kmt) 4,024 4,178 4,153 rd Party Shipments (kmt) 2,206 2,378 2,293 rd Party Revenue ($ Millions) ATOI ($ Millions) Revenue down 8.5% sequential
Slide 9: Primary Metals
Primary Metals 1 st Quarter Results 1 st Quarter Business Highlights 2 nd Quarter Outlook 1 st Quarter Performance Bridge [Alcoa logo] Improving business conditions created positive pressure on regional premiums and product mix Favorable pricing limited seasonal energy increases, but reduced energy
Slide 10: Global Rolled Products
2 nd Quarter Outlook 1 st Quarter Business Highlights 1 st Quarter Results 1 st Quarter Performance Bridge Global Rolled Products Record Q1 ATOI and highest ever EBITDA/mt Aerospace and NA automotive demand remains strong European markets stabilizing but less than year ago levels Days working capita
Slide 11: Engineered Products and Solutions
Engineered Products and Solutions 1 st Quarter Performance Bridge 1 st Quarter Business Highlights 1 st Quarter Results 2 nd Quarter Outlook $ Millions 1Q 11 4Q 11 1Q 12 rd Party Revenue 1,247 1,355 1,390 ATOI Adjusted EBITDA Margin 18% 16% 19% 11% revenue growth from Q1 27% sequential improvement i
Slide 12: First Quarter 2012 Cash Flow Overview
First Quarter 2012 Cash Flow Overview ($ Millions) 1Q’11 4Q’11 1Q’12 Net Income (Loss) $366 ($163) $99 DD&A $361 $368 $369 Change in Working Capital ($651) $797 ($289) Pension Contributions ($31) ($119) ($213) Taxes / Other Adjustments ($281) $259 ($202) Cash from Operations ($236) $1,142 ($236) Div
Slide 13: Sustainable Reductions Maintained in Days Working Capital
Sustainable Reductions Maintained in Days Working Capital Record Low Days for First Quarter Days Working Capital since Fourth Quarter 2008 -7 days 10 days lower 3 days lower 3 days lower
Slide 14: Proactive Cash Sustainability Actions… Strong Start To 2012
Proactive Cash Sustainability Actions… Strong Start To 2012
Slide 15: Klaus Kleinfeld, Chairman and Chief Executive Officer
Klaus Kleinfeld Chairman and Chief Executive Officer
Slide 16: 2012 Market Conditions
2012 Market Conditions Alcoa End Markets: Current Assessment of 2012 vs. 2011 Source: Alcoa analysis
Slide 17: End Market Conditions Support Continued Demand Growth
1.9 1.0 0.9 21.1 6.7 5.9 5.8 3.5 * Other consists of: Middle East, Latin America ex Brazil and ROW 2012 Projected Primary Aluminum Consumption Growth Rates (%) by Region (in mmt) End Market Conditions Support Continued Demand Growth 11% 15% 1% -0.3% 6% 3% 10% 8% 15% 6% 10% 10% 3% 5% 4% 4% China Euro
Slide 18: Metal Deficit Remains, Alumina Moves To Moderate Surplus
Metal Deficit Remains, Alumina Moves To Moderate Surplus Primary Aluminum Alumina Source: Alcoa estimates, Brook Hunt, CRU, CNIA, IAI (000 mt) China Rest of World Feb 2012 Annualized Rate 19,400 25,200 2012 Production Added 2,500 2012 Capacity Curtailed (1,100) (250) Total Supply 20,800 25,600 Deman
Slide 19: Rapid Expansion To The West - East Also Growing
Rapid Expansion To The West - East Also Growing 2,100 2,765 Chinese Primary Aluminum Production by Region, and 2015, in mt 48% 52% 37% 63% CAGR in Production 11.7% Source: CRU, CRU, Brook Hunt and SMM 6,640 7,485 2,350 4,250 6,710 Northwest Central East South 27,500 13,000 +54% 17,800
Slide 20: Move to the West - No Significant Improvement
Move to the West - No Significant Improvement Source: CNIA, CRU, IAI, NDRC, Rhodium Group, Ministry of Water, Alcoa estimates
Slide 21: China Inventory Rises, Physical Premiums Move Sharply Higher
China Inventory Rises, ROW Stable Physical Premiums Move Sharply Higher Strong Rise In Premiums, Inventory Ex China Is Stable 3.5 1.6 1.4 2.3 4.3 .7 1.5 2.3 $122 /MT $205 /MT $194 /MT Source: Alcoa estimates, LME, SHFE, IAI, Marubeni, Platt’s Metals Week and Metal Bulletin Regional Premiums and Alum
Slide 22: Macro Indicators Showing Signs of Stabilization
Macro Indicators Showing Signs of Stabilization Sources: Bloomberg, *Confidence figures set at 100 in January 2011 for comparability ; EC Commission EU Confidence, National Bureau of Statistics China Consumer Confidence, University of Michigan Consumer Sentiment . PMI: Institute for Supply Managemen
Slide 23: Executing the Alcoa Strategy: The Three Strategic Priorities
Executing the Alcoa Strategy: The Three Strategic Priorities
Slide 24: Driving Profitable Growth To Accelerate Shareholder Value
Driving Profitable Growth To Accelerate Shareholder Value Upstream 2015 Cost Curve Changes Refining Cost Curve Position Smelting Cost Curve Position Midstream 2013 Revenue Targets Downstream 2013 Revenue Targets Strategy Executed 30 th 25 th Strategy Executed 50 th 45 th 40 th 30 th 23 rd 51 st 41 s
Slide 25: Alumina: Improve Performance Through Cost and Price Focus
Alumina: Improve Performance Through Cost and Price Focus Source: CRU Spot and Australia export - ABARE, Baltic Exchange, CRU, Metal Bulletin, PACE, Alcoa estimate
Slide 26: Aluminum: Achieve Low Cost Position and Optimize Margins
Aluminum: Achieve Low Cost Position and Optimize Margins Driving Down the Cost Curve – 10 points Optimizing Cast House Profitability T-Bar Foundry Rod Smelting: Utilize inventory to reline, but do not restart pots Targeted smaller curtailments based upon cost & strategic situation Full curtailment o
Slide 27: Saudi Investments Drive Profitable Growth
Saudi Investments Drive Profitable Growth Carbon Plant Area Port – Liquid Pitch Tanks Potline Hot Reversing Mill Coolant Pit On Time AND On Budget
Slide 28: GRP Targets for 2013
GRP Targets for 2013 Global Rolled Products: Well On Track To Meet 2013 Targets Achieved 55% of 2013 Revenue Growth Target In Year One $1.4 *~ $1.5B Revenue Growth From the Market and ~ $1.0B Revenue Growth From New Products and Share Gains 55% of Growth Target * $ Billions
Slide 29: GRP Aerospace Portfolio: Significant Growth by 2013
1,480 1,165 GRP Aerospace Portfolio: Significant Growth by 2013 GRP Aero Strategy B737 A320 B777 B747 A380 Total ( Including others not shown) +27.0% +15.4% +177.8% +30.1% +12.8% +20.6% Build Rates Capture strong market growth with robust build rates for aircraft and our superior reliability Deliver
Slide 30: GRP Profitable Growth: Expanding in Key Markets
GRP Profitable Growth: Expanding in Key Markets Aerospace Packaging Differentiated capabilities Globally positioned facilities Product development for Al-Li alloy Leading position in core regions Capacity expansion , e.g. Saudi Arabia JV Innovation , e.g. Al bottle, shaped can Light weighting drives
Slide 31: Driving Profitable Growth in Emerging Markets
Driving Profitable Growth in Emerging Markets Russia – Growing Profitably China – Positioning For Growth Establishing as key domestic supplier in growing consumer electronics and automotive markets Positive EBITDA in 2011, focusing on differentiation CPI JV signed : Platform for growth Growing can s
Slide 32: EPS Targets for 2013
Achieved 44% of 2013 Revenue Growth Target in Year One EPS Targets for 2013 EPS: Strong Markets and Innovation Drive Profitable Growth $0.7 * *~ $600M Revenue Growth From the Market and ~ $1.0B Revenue Growth From New Products and Share Gains 44% of Growth Target $ Billions
Slide 33: EPS: Grow Through Leading Position in Strong End Markets
Aerospace Heavy Duty Truck Industrial Gas Turbine Non-Residential Construction EPS: Grow Through Leading Position in Strong End Markets 47% 16% 10 % 19% Fasteners #1 Airfoils #1 Forgings #1 Extrusions #2 2012 vs. 2011* Markets and Competitive Position Airfoils #1 Aluminum Wheels #1 NA Fasteners #1 1
Slide 34: EPS: Add Share Gain Through Product Innovation
EPS: Add Share Gain Through Product Innovation Targeting ~$1 billion of increased revenue by 2013 versus 2010 through new products and share gains Industrial Gas Turbines Advanced Cooling Systems High Gradient Single Crystal Airfoils Commercial Transportation Wheel Torque Solutions LvL ONE® Wheels F
Slide 35: EPS: Strategic Focus on Acquisitions in Targeted Segments
Bolt On Acquisitions EPS: Strategic Focus on Acquisitions in Targeted Segments 2002 2008 2009 2010 2011 Demicron Fairchild Republic & Van Petty Traco Transdigm Fasteners
Slide 36: Strong Start into 2012 – Delivering on our Promises
Strong Start into 2012 – Delivering on our Promises
Slide 37: Slide 37
Slide 38: Additional Information
Additional Information Kelly Pasterick Director, Investor Relations Alcoa 390 Park Avenue New York, NY 10022-4608 Telephone: (212) 836-2674 www.alcoa.com
Slide 39: Annual Sensitivity Summary
Annual Sensitivity Summary Currency Annual Net Income Sensitivity LME Aluminum Annual Net Income Sensitivity +/- $100/MT = +/- $220 million Australian $ +/- $11 million per 0.01 change in USD / AUD Brazilian $ +/- $ 3 million per 0.01 change in BRL / USD Euro € +/- $ 2 million per 0.01 change in USD
Slide 40: Revenue Change by Market
Revenue Change by Market 1Q’12 Third-Party Revenue Sequential Change Year-Over-Year Change * GRP restated all Distribution revenue from the Distribution/othe r market to the various end user markets. *With GRP restating Distribution revenue the Distribution/other market now shows negative revenue. M
Slide 41: Reconciliation of ATOI to Consolidated Net Income Attributable to Alcoa
Reconciliation of ATOI to Consolidated Net Income (Loss) Attributable to Alcoa (in millions) 1Q11 2Q11 3Q11 4Q11 1Q12 Total segment ATOI $ $ $ $ $ 1,893 $ Unallocated amounts (net of tax): Impact of LIFO (24) (27) (38) – Interest expense (72) (106) (81) (81) (340) (80) Noncontrolling interests (58)
Slide 42: Reconciliation of Adjusted Income
Reconciliation of Adjusted Income
Slide 43: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow (in millions) Quarter ended Year ended March 31, December 31, March 31, December 31, Cash from operations $ (236) $ 1,142 $ (236) $ 2,193 Capital expenditures (204) (486) (270) (1,287) Free cash flow $ (440) $ 656 $ (506) $ 906 Free Cash Flow is a non-GAAP financial
Slide 44: Reconciliation of Alcoa Adjusted EBITDA
Reconciliation of Alcoa Adjusted EBITDA ($ in millions) 1Q11 4Q11 1Q12 Net income (loss) attributable to Alcoa $ 420 $ 938 $ 1,310 $ 1,233 $ 2,248 $ 2,564 $ (74) $ (1,151) $ 254 $ 611 $ 308 $ (191) $ 94 Add: Net income attributable to noncontrolling interests Cumulative effect of accounting changes
Slide 45: Reconciliation of Alumina Adjusted EBITDA
Reconciliation of Alumina Adjusted EBITDA
Slide 46: Reconciliation of Primary Metals Adjusted EBITDA
Reconciliation of Primary Metals Adjusted EBITDA ($ in millions, except per metric ton amounts) 1Q11 4Q11 1Q12 After-tax operating income (ATOI) $ 650 $ 657 $ 808 $ 822 $ 1,760 $ 1,445 $ 931 $ (612) $ 488 $ 481 $ 202 $ (32) $ 10 Add: Depreciation, depletion, and amortization Equity (income) loss (44
Slide 47: Reconciliation of Global Rolled Products Adjusted EBITDA
Reconciliation of Global Rolled Products Adjusted EBITDA ($ in millions, except per metric ton amounts) 1Q11 4Q11 1Q12 After-tax operating income (ATOI) $ 225 $ 222 $ 254 $ 278 $ 233 $ 178 $ (3) $ (49) $ 220 $ 266 $ 81 $ 26 $ 96 Add: Depreciation, depletion, and amortization Equity loss – – – – – –
Slide 48: Reconciliation of Engineered Products and Solutions Adjusted EBITDA
Reconciliation of Engineered Products and Solutions Adjusted EBITDA ($ in millions) 1Q11 4Q11 1Q12 After-tax operating income (ATOI) $ 63 $ 124 $ 156 $ 271 $ 365 $ 435 $ 533 $ 315 $ 415 $ 539 $ 130 $ 122 $ 155 Add: Depreciation, depletion, and amortization Equity loss (income) – – – – – – (2) (2) (1
Slide 49: Days Working Capital
Days Working Capital ($ in millions) Quarter ended March 31, December 31, March 31, Receivables from customers, less allowances $ 2,030 $ 1,571 $ 1,526 Add: Deferred purchase price receivable * – – Receivables from customers, less allowances, as adjusted 2,030 1,571 1,780 Add: Inventories 3,018 2,89