Slide 1: 2nd Quarter Earnings Conference
Exhibit 99.2 [Alcoa logo] 2nd Quarter Earnings Conference [Alcoa logo] July 8, 2013 1
Slide 2: Cautionary Statement
[Alcoa logo] Cautionary Statement Forward-Looking Statements 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,”
Slide 3: 2Q 2013 Overview
[Alcoa logo] Strong underlying performance offset by special items 2Q 2013 Overview Strong revenue despite lower metal prices Record Profitability in the Downstream; ATOI up 23% YOY Alcoa Value-Add businesses in 1H 2013: 57% total Revenue and 80% Segment ATOI Continuing to deliver $539 million in Pr
Slide 4: William Oplinger
[Alcoa logo] William Oplinger [Alcoa logo] Executive Vice President and Chief Financial Officer July 8, 2013 4
Slide 5: Income Statement Summary
[Alcoa logo] Income Statement Summary Sequential $ Millions, except aluminum prices and per-share amounts 2Q12 1Q13 2Q13 Change Realized Aluminum Price ($/MT) $2,329 $2,398 $2,237 ($161) Revenue $5,963 $5,833 $5,849 $16 Cost of Goods Sold $5,154 $4,847 $4,933 $86 COGS % Revenue 86.4% 83.1% 84.3% 1.2
Slide 6: Restructuring and Other Special Items
[Alcoa logo] Restructuring and Other Special Items Income Statement $ Millions, except per-share amounts 1Q13 2Q13 Segment Classification Income (Loss) from Continuing Operations $149 ($119) Income (Loss) Per Diluted Share $0.13 ($0.11) Corporate / Restructuring-Related ($5) ($113) Restructuring and
Slide 7: Performance offsets 67% of market and cost headwinds
[Alcoa logo] Performance offsets 67% of market and cost headwinds Net Income Excluding Restructuring & Other Special Items (millions) 121 4 24 43 76 44 150 1 45 30 1Q 2013 LME Currency Volume Price Productivity Energy Raw Cost 2Q 2013 / Mix Materials Increases / Other Market Performance Cost Headwin
Slide 8: Record results for Engineered Products and Solutions
[Alcoa logo] Record results for Engineered Products and Solutions 2Q13 Actual and 3Q13 Outlook -EPS nd nd 2 Quarter Results 2 Quarter Business Highlights $ Millions 2Q 12 1Q 13 2Q 13 Best ever ATOI Quarter Highest ever Quarter for adjusted EBITDA margin 3 rd Party Revenue 1,420 1,423 1,468 Revenue u
Slide 9: Global Rolled Products impacted by lower metal price
[Alcoa logo] Global Rolled Products impacted by lower metal price 2Q13 Actual and 3Q13 Outlook - GRP nd nd 2 Quarter Results 2 Quarter Business Highlights $ Millions 2Q 12 1Q 13 2Q 13 Unfavorable impacts from lower metal price rd Aerospace and Auto demand remained strong 3 Party Revenue 1,913 1,779
Slide 10: Alumina performance more than offsets market impact
[Alcoa logo] Alumina performance more than offsets market impact 2Q13 Actual and 3Q13 Outlook - Alumina nd nd 2 Quarter Results 2 Quarter Business Highlights 2Q 12 1Q 13 2Q 13 Production increase due to additional day in quarter Price Index and spot pricing continued positive trend Production (kmt)
Slide 11: Primary Metals performs with price, mix and productivity
[Alcoa logo] Primary Metals performs with price, mix and productivity 2Q13 Actual and 3Q13 Outlook – Primary Metals nd nd 2 Quarter Results 2 Quarter Business Highlights 2Q 12 1Q 13 2Q 13 Price/Mix improved as regional premiums rose and Production (kmt) 941 891 896 value-added product mix strengthen
Slide 12: Record second quarter days working capital level
[Alcoa logo] Record second quarter days working capital level Days Working Capital since Fourth Quarter 2008 See appendix for days working capital reconciliation 12
Slide 13: 2nd Quarter Cash Flow Overview
[Alcoa logo] 2 nd Quarter Cash Flow Overview See appendix for Free Cash Flow, Net Debt and Net Debt-to-Capital reconciliations 13
Slide 14: Positive Free Cash Flow
[Alcoa logo] On track to meet our targets to maximize cash Key Actions to Execute 2013 Cash Sustainability Program and year-to-date results Taking the right actions Overarching 2013 Financial Target YTD: Generate Productivity Gains of $539M $750M Manage Growth Capital of $550M $203M Positive Control
Slide 15: Market fundamentals are stable
[Alcoa logo] Market fundamentals are stable Global Aluminum Demand Growth at 7% Market Tightening On Curtailments 2013 Primary Aluminum Consumption (mmt) and Annualized Growth (%) Supply/Demand analysis Inventory is Stable Regional Premiums Remain Strong Global Inventories vs. LME Price Over Time $
Slide 16: Klaus Kleinfeld
[Alcoa logo] Klaus Kleinfeld [Alcoa logo] Chairman and Chief Executive Officer July 8, 2013
Slide 17: Growth continues in global end markets
[Alcoa logo] Growth continues in global end markets Alcoa End Markets: Current Assessment of 2013 vs. 2012 North America Europe China Global Aerospace 9% - 10% sales growth Automotive 2% - 5% 2% - 5% 7% - 10% 1% - 4% prod growth prod decline prod growth prod growth Heavy Truck & 9% - 13% 3% - 8% 12%
Slide 18: Alcoa shines at the Paris Air Show
[Alcoa logo] Alcoa shines at the Paris Air Show Commercial Aerospace cycle remains robust 900+ new orders and commitments for Airbus and Boeing valued at ~$135B • 8 year backlog • Demand driven by emerging markets and fuel efficiency Boeing B787-10 launched with 102 commitments • Will compete head-o
Slide 19: Alcoa Blue flies from nose to tail
[Alcoa logo] Alcoa Blue flies from nose to tail 19
Slide 20: Alcoa technology enables strong position on CFRP aircraft
[Alcoa logo] Alcoa technology enables strong position on CFRP aircraft Note: CFRP refers to carbon fiber reinforced plastic fastened panels 20
Slide 21: Innovation drives higher Alcoa content on CFRP aircraft
[Alcoa logo] Innovation drives higher Alcoa content on CFRP aircraft 21
Slide 22: Alcoa's content runs from bumper to bumper
[Alcoa logo] Alcoa’s content runs from bumper to bumper Alcoa participation in automotive parts 22
Slide 23: Smart utilization of an existing rolling mill
[Alcoa logo] Smart utilization of an existing rolling mill Source: Ducker Worldwide , IHS , Alcoa analysis *Extrapolated based on IHS 2020 forecast 23
Slide 24: Upstream taking actions to improve cost position
[Alcoa logo] Upstream taking actions to improve cost position Production Curtailments: Tiered Approach Smelting curtailment steps 13% of capacity currently idle 291kmt permanently closed in 2012 Permanent shutdowns of Announced 460kmt under review: selected plants Includes Baie Comeau 105kmt closure
Slide 25: Multiple levers capture savings across the organization
[Alcoa logo] Multiple levers capture savings across the organization Productivity levers and year-over-year productivity* savings, $M Productivity Levers 2,410 1,291 72% of target Process Technology captured in Process Lean Manufacturing 1,099 1H 2013 Productivity Lower Cost Countries 742 750 Purcha
Slide 26: Rigorous tracking from Idea to Cash
[Alcoa logo] Rigorous tracking from Idea to Cash Standardized system for productivity management and system advantages Degrees of Implementation Process Cascaded throughout Alcoa Incorporated into daily operations Target Idea Monitoring Setting Generation Action Plan & Reporting Integrated stakehold
Slide 27: On-site recycling & casting facility lowers cost and emissions
[Alcoa logo] On-site recycling & casting facility lowers cost and emissions Supply chain simplification drives cost and environmental benefits Supply chain simplification New Process Benefits Third-party scrap recycling 100M lbs. scrap recycled on-site New York, Ontario, Michigan Casting 1/3 of annu
Slide 28: Procurement pulls different levers to generate savings
[Alcoa logo] Procurement pulls different levers to generate savings Examples of savings levers & impacts Direct cost savings: carbon strategy Indirect cost savings: facility maintenance Supplier Challenge current positions with Work Scope Reduce service usage by Diversification alternative supplier
Slide 29: "Four Plants, One Business" project drives overhead savings
[Alcoa logo] “Four Plants, One Business” project drives overhead savings Spain upstream operations and the building blocks to a leaner organization 29
Slide 30: Creating value by focusing on the things we can control
[Alcoa logo] Creating value by focusing on the things we can control Building strong growth platforms in our Value-Add businesses Executing cost competitive strategy to win in commodity market Continuing focus on productivity and cash generation 30
Slide 31: [Alcoa logo]
[Alcoa logo] 31
Slide 32: Additional Information
[Alcoa logo] Additional Information Kelly Pasterick Director, Investor Relations Alcoa 390 Park Avenue New York, NY 10022-4608 Telephone: (212) 836-2674 www.alcoa.com 32
Slide 33: Annual Sensitivity Summary
[Alcoa logo] Annual Sensitivity Summary LME Aluminum Annual Net Income Sensitivity +/- $100/MT = +/- $240 million Currency Annual Net Income Sensitivity 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
Slide 34: Revenue Change by Market
[Alcoa logo] Revenue Change by Market Sequential Year-Over-Year 2Q’13 Third-Party Revenue Change Change Aerospace 3% 5% 28% Automotive 9% 9% 17% B&C 9% 6% 3% Comm. Transport 3% (11%) Industrial Products 1% (3%) 7% IGT (2%) 7% 6% Packaging 10% (1%) 14% Distribution/Other (0%) (30%) 8% 1% 14% 2% Alumi
Slide 35: Reconciliation of ATOI to Consolidated Net Income (Loss) Attributable to Alcoa
[Alcoa logo] Reconciliation of ATOI to Consolidated Net Income (Loss) Attributable to Alcoa (in millions) 1Q12 2Q12 3Q12 4Q12 2012 1Q13 2Q13 Total segment ATOI* $ 304 $ 255 $ 224 $ 574 $ 1,357 $ 351 $ 304 Unallocated amounts (net of tax): Impact of LIFO – 19 (7) 8 20 (2) 5 Interest expense (80) (80)
Slide 36: Reconciliation of Adjusted Income
[Alcoa logo] Reconciliation of Adjusted Income Net income 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 c
Slide 37: Reconciliation of Alcoa Adjusted EBITDA
[Alcoa logo] Reconciliation of Alcoa Adjusted EBITDA Alcoa’s definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following items: Cost
Slide 38: Reconciliation of Alumina Adjusted EBITDA
[Alcoa logo] Reconciliation of Alumina Adjusted EBITDA Alcoa’s definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following items: Co
Slide 39: Reconciliation of Primary Metals Adjusted EBITDA
[Alcoa logo] Reconciliation of Primary Metals Adjusted EBITDA Alcoa’s definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the following it
Slide 40: Reconciliation of Global Rolled Products Adjusted EBITDA
[Alcoa logo] Reconciliation of Global Rolled Products Adjusted EBITDA Alcoa’s definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales minus the foll
Slide 41: Reconciliation of Engineered Products and Solutions Adjusted EBITDA
[Alcoa logo] Reconciliation of Engineered Products and Solutions Adjusted EBITDA Alcoa’s definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin plus an add-back for depreciation, depletion, and amortization. Net margin is equivalent to Sales min
Slide 42: Reconciliation of Free Cash Flow
[Alcoa logo] Reconciliation of Free Cash Flow 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 the
Slide 43: Reconciliation of Free Cash Flow, con't
[Alcoa logo] Reconciliation of Free Cash Flow, con’t 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 t
Slide 44: Days Working Capital
[Alcoa logo] Days Working Capital Days Working Capital = Working Capital divided by (Sales/number of days in the quarter). * The deferred purchase price receivable relates to an arrangementto sell certain customer receivables to a financial institution on a recurring basis. Alcoa is adding back this
Slide 45: Reconciliation of Net Debt
[Alcoa logo] Reconciliation of Net Debt Net debt is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because management assesses Alcoa’s leverage position after factoring in available cash that could be used to repay outstanding debt. 45
Slide 46: Reconciliation of Net Debt-to-Capital
[Alcoa logo] Reconciliation of Net Debt-to-Capital Net debt-to-capital is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because management assesses Alcoa’s leverage position after factoring in available cash that could be used to repay outstanding deb
Slide 47: Composition of Upstream Production Costs
[Alcoa logo] Composition of Upstream Production Costs Refining Cost Structure Input Cost Inventory flow Pricing Annual ATOI Fuel Oil convention Sensitivity 14% Conversion Fuel oil 1 – 2 months Prior month $4m per $1/bbl 42% Natural gas 10% 1 Natural gas N/A Spot¹ $16m per $1/GJ Spot & semi- $9m per
Slide 48: Global Aluminum Demand Growth of 7%
[Alcoa logo] Global Aluminum Demand Growth of 7% 2013 Primary Aluminum Consumption (mmt), Annualized Growth (%) Russia Brazil 1.0 5% 6% 1.0 1% 4% Other ¹ 1.9 4% 4% MENA 1.9 9% 10% SE Asia 1.9 13% 11% India 2.0 6% 9% North Asia 4.0 2% 2% 6.2 4% 4% North America 6.5 -2% -1% Europe China 23.0 9% 11% 20
Slide 49: Market Continues to Tighten On Curtailments
[Alcoa logo] Market Continues to Tighten On Curtailments 2013E 2013E Alumina Alumina Supply/Demand Supply/Demand Balance Balance 2013E 2013E Aluminum Aluminum Supply/Demand Supply/Demand Balance Balance 1Q2013 1Q2013 Deficit Surplus (100) 155 Surplus Deficit 130 (315) Supply Demand Supply Demand ‘00
Slide 50: Inventory is Stable
[Alcoa logo] Inventory is Stable Global Inventories vs. LME Price Over Time $ Days of $ per metric ton Days of Days of Days of Consumption Consumption Consumption Consumption $3,250 108 days 83 days 77 days 105 LME Price LME Price LME Price 98 $2,214/MT $3,050 $2,686/MT $1,857/MT 91 $2,850 84 $2,650
Slide 51: Regional Premiums Remain Strong
[Alcoa logo] Regional Premiums Remain Strong $ per metric Regional Premiums over time $ per metric ton ton $300 Year on Year Change $300 Region End of Q2’13 Europe +12% Europe $285/MT Japan +6% $250 $250 Japan $250MT Midwest USA +16% Midwest USA $261/MT $200 $200 $150 $150 $100 $100 $50 $50 $0 $0 So