EX-99.2 3 dex992.htm SLIDES PRESENTED DURING ALCOA INC. FIRST QUARTER 2006 EARNINGS CALL Slides presented during Alcoa Inc. first quarter 2006 earnings call
[Alcoa Logo]
1st Quarter 2006
Analyst Conference
April 10, 2006
Exhibit 99.2

2
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, 2005 filed with the Securities
and Exchange Commission.
Forward-Looking Statements

[Alcoa Logo]
Alain J. P. Belda
Chairman and Chief Executive Officer

4
1   Quarter 2006 Highlights
Record income from continuing operations
of $615m or $0.70 per share
Highest quarterly revenues in company
history
of $7.24b
Record profits
in the Alumina, Primary Metals
and Engineered Solutions segments
Q1 annualized ROC
of 14.2%,
well in excess
of cost of capital
st

5
Safety  -
1  Quarter 2006
Lost Work Days
Total Recordables
92%
8%
61%
39%
Zero Incident Locations
345
31
0
50
100
150
200
250
300
350
400
No LWD
LWD
# of
Locations
231
145
0
50
100
150
200
250
300
350
No TRR
TRR
# of
Locations
st

6
Operational Excellence
Production records set in Alumina Segment
Quarterly production record for the refinery system
Five refineries achieved quarterly production records
Flat-Rolled Products Segment excels
Record shipments in the automotive heat exchanger market out
of Kofem
Record shipments out of Kitts Green
Extruded and End Products Segment improves
Record production in the Lafayette aerospace flow-path
Engineered Solutions Segment has record results
Record shipments for Class 8 truck wheels
Record productivity in Fasteners Business

7
Innovation and New Products
Dura-Bright Fuel Tanks:
Greater than a $100 million revenue
opportunity -
to be launched in the next 12 months 
Smart Box –
Power Distribution System:
Launch in progress of a
new AFL product developed jointly with the customer for efficient
automotive power distribution -
revenue potential of $45 million
Alcoa Spaceframe:
Selected for the new Ferrari 599 GTB Fiorano
Packaging:
Several products in the Packaging and Consumer
Segment such as the next generation bottled water closures, Cater-
Time platters and Microwave Foam
Defense Products:
Multiple products for 14 different military
platforms being prototyped and tested
Process Breakthroughs:
Simultaneous Multi Alloy Casting

8
Growth, Sustainable Development
and Portfolio Management
–
Alumar
smelter expansion completed and fully operational
–
Mechanical completion of the Pinjarra
refinery expansion
–
Increased our stake in the Estreito
hydropower project in Northern Brazil from
19.08% to 25.49%
–
Signed Agreement in Principle to build a 341,000 mtpy
aluminum smelter in
Trinidad
–
Selected to develop and began feasibility studies for a 250,000 mtpy
aluminum
smelter in North Iceland
–
Fjardaal, Iceland smelter construction on schedule
–
Formed aluminum brazing sheet joint venture in China
–
Published China Sustainability Report

9
Global Environment
Worldwide Alumina/Aluminum Supply & Demand
(200)
(400)
(1,300)
(300)
Long /
(Short)
Alumina
68,300
64,600
61,800
57,300
Demand
68,100
64,200
60,500
57,000
Supply
Aluminum
(200)
(500)
0
(700)
Long /
(Short)
35,200
33,600
31,700
30,000
Demand
35,000
33,100
31,700
29,300
Supply
2007
2006
2005
2004
000 tons
Source:
CRU, Metal Bulletin and Alcoa Analysis

10
Global Environment
Regional Premiums
Source:
Platts
Regional Premiums
$25
$45
$65
$85
$105
$125
$145
$165
$185
Prompt Midwest $/mt
CIF Japan
Duty Paid Europe

11
Global Environment
Aluminum Inventory History
Sources:
IAI, LME
LME & IAI Stock Implied Days of Global Consumption  Consumption
February 2006 : 27.7 Days DOWN from 29.9 Days
0
7
14
21
28
35
42
49
56
IAI Global Days of Consumption
LME Global Days Consumption
19.2
Days
8.5
Days

12
[Alcoa Logo]
Joseph Muscari
Executive Vice President
Chief Financial Officer

13
Record income from continuing operations of $615 million ($0.70 per share)
was 190% and 129% higher than the previous and prior year quarter
respectively
Highest
quarterly
revenues
of
$7.24
billion
–
9%
and
16%
higher
than
the
previous
and
prior
year quarter
respectively
Capital
expenditures
were
$592
million
–
63%
was
devoted
to
growth
projects
Working capital increased; however Days of Working Capital improved three
days year over year
Debt-to-cap in target range at 32.4%
Trailing four quarters ROC of 9.7%;  ROC excluding growth investments of
11.2%
Prior period restructuring generated approximately $30 million pre-tax savings
Included in the results are the negative impact of stock-based compensation
expenses of $20 million, or $0.02 per share
1
Quarter
2006
Financial
Overview
st

14
1
Quarter
2006
Financial
Review
In Millions
4Q'05
1Q'06
Change
Sales
$6,666
$7,244
$578
Cost of Goods Sold
$5,453
$5,459
$6
   % of Sales
81.8%
75.4%
(6.4 pts)
SG&A
$362
$369
$7
   % of Sales
5.4%
5.1%
(0.3 pts)
Restructuring and Other Charges
$26
$1
($25)
Interest Expense
$78
$92
$14
Other Income, Net (Gain)
($5)
($35)
($30)
Effective Tax Rate
24.4%
28.1%
(3.7)%
Minority Interests
$80
$105
$25
GAAP Net Income
$224
$608
$384
(Loss) Income from Discontinued Operations
$14
($7)
($21)
Cumulative effect of Accounting Change
($2)
$0
$2
GAAP Income From Continuing Operations
$212
$615
$403
st

15
1
Quarter
2006
Cash
Flow
Review
Capital Expenditures
Debt-to-Capital
$ In Millions
1Q'05
1Q'06
Net Income
$260
$608
DD&A
315
309
Change in Working Capital
(769)
(1,030)
Other Adjustments
(27)
(23)
Pension Contributions
(18)
(77)
Cash From Operating Activities
(239)
(213)
Dividends to Shareholders
(131)
(131)
Other Financing Activities
1,000
701
Cash From Financing Activities
869
570
Capital Expenditures
(347)
(592)
Acquisitions
(433)
(1)
Other Investing Activities
196
(74)
Cash From Investing Activities
($584)
($667)
$347
$592
72%
50%
$0
$200
$400
$600
$800
1Q05
1Q06
40%
60%
80%
100%
Growth projects
Non-Growth spend
Non-Growth Capex / Depreciation
$7,276
$7,327
32.4%
33.3%
$6,000
$7,000
$8,000
1Q05
1Q06
25%
30%
35%
40%
Debt
Debt/Cap
st

16
Revenue and ATOI Performance
Historical Performance of Combined Segments
($million)
Total ATOI is the sum of the segment ATOI.
0
200
400
600
800
1,000
0
2,500
5,000
7,500
10,000
ATOI
Revenue

17
Alumina
Benefit from higher LME on an
approximate 2 to 3 month lag
Productivity gains continue
Pinjarra expansion ramping up
Realized benefit of strong LME
Production record for entire system
as well as 5 out of 9 refineries
achieved quarterly records
Higher energy costs
1
Quarter
Dynamics
ATOI Performance
0
40
80
120
160
200
240
280
1Q05
4Q05
1Q06
$ Millions
1Q vs
1Q
1Q vs
4Q
1Q’06
50%
32%
242
ATOI ($MM)
24%
12%
628
3
Party
Sales
($MM)
3%
0%
3,702
Production (kmt)
5%
3%
2,023
3
Party
Shipmts
(kmt)
rd
rd
2
Quarter
Outlook
nd
st
1
Quarter
Highlights
st

18
Primary Metals
1Q vs
1Q
98%
29%
ATOI Performance
Increases in LME and premiums
driven by strong demand
Lower shipments and production
due to Eastalco
curtailment and
Portland outage
Full benefit of Alumar
expansion
Portland not back to 100%
Power costs will be challenging
April sales on a 30 day LME lag at
$2,431/mt
1
Quarter
Highlights
1
Quarter
Dynamics
0
50
100
150
200
250
300
350
400
450
1Q05
4Q05
1Q06
$ Millions
st
st
1Q vs
4Q
1Q’06
84%
445
ATOI ($MM)
10%
1,408
3
Party
Sales
($MM)
2%
(4%)
867
Production (kmt)
24%
16%
$2,534
3
Party
Price
0%
(12%)
488
3
Party
Shipmts
(kmt)
rd
rd
rd
2
Quarter
Outlook
nd

19
Flat-Rolled Products
1Q vs 1Q
1Q vs 4Q
$MM
(12%)
6%
66
ATOI
17%
12%
1,940
Revenue
1
Quarter
Highlights
1
Quarter
Dynamics
2
Quarter
Outlook
ATOI Performance
Aerospace and commercial
transportation demand remains
strong
Seasonal increase in can sheet
volumes
Russia will continue to be
challenging
Strong demand in the aerospace
and industrial products markets
Demand for common alloy
products robust in North America
Energy & freight costs remain
high
Can Sheet
Aerospace
Automotive
Building &
Construction
Distribution
Industrial
0
20
40
60
80
1Q05
4Q05
1Q06
$ Millions
nd
st
st

20
Extruded & End Products
1
Quarter
Dynamics
ATOI Performance
Seasonal increase in B&C and
soft alloy extrusion demand
Stronger volumes over prior
quarter
Lower Russia volumes
Commercial
Vehicle
Aerospace
Automotive
Building &
Construction
Distribution
Industrial
1Q vs 1Q
1Q vs 4Q
$MM
NM
NM
(0)
ATOI
13%
14%
1,170
Revenue
-5
0
5
10
15
1Q05
4Q05
1Q06
st
2
Quarter
Outlook
nd
1
Quarter
Highlights
st

21
Seasonal declines in Consumer
Products, although volumes higher
year over year
Weaker volume and pricing in Food
Packaging
Packaging & Consumer
1Q vs
1Q
1Q vs
4Q
$MM
(50%)
(60%)
8
ATOI
6%
(6%)
749
Revenue
1
Quarter
Dynamics
ATOI Performance
Strong seasonal demand in
Consumer Products and Closures
Consumer
Products
Closures
Flexible
Packaging
Reynolds Food
Packaging
0
10
20
30
1Q05
4Q05
1Q06
$ Millions
2
Quarter
Outlook
nd
st
1
Quarter
Highlights
st

22
Engineered Solutions
36%
10%
1Q vs
1Q
77%
83
ATOI
1Q vs
4Q
$MM
7%
1,360
Revenue
1
Quarter
Highlights
1
Quarter
Dynamics
ATOI Performance
Strong productivity gains across all
businesses of the segment
Market growth supported by record
production in Forged Products, and
Fasteners
New products & favorable mix aided
top line and bottom line performance
2005 investment in portfolio
restructuring generating significant
dividends
2
Quarter
Outlook
Productivity gains realized in Q1
sustainable
Automotive demand is softening
Underlying demand in aerospace and
commercial transportation remains
strong and in line with Q1
25
35
45
55
65
75
85
95
1Q05
4Q05
1Q06
$ Millions
st
st
nd

23
Engineered Solutions –
Next Level of Detail
($1)
($5)
($5)
Other
$47
$65
($13)
4Q05
Total
Investment Castings,
Forgings,  Fasteners
AFL, Auto Castings
and Structures
$83
$93
($5)
1Q06
$61
$58
$4
1Q05
ATOI ($ Millions)
AFL performance significantly
improved from 2H05
Launches stabilized
Large productivity
improvements in Mexico
and Europe
Investment castings, forgings,
and fasteners drove 13%
productivity improvements
delivering cost reductions and
capacity
ABS de-bottlenecked
constrained facilities
Investment in advanced
process technologies
Raw Material escalation
captured in pricing
2005 portfolio restructuring
generating $15 million pre-tax
savings
Expanding capacity in
investment castings, forgings,
and fasteners to accommodate
new products, strong market
demand, and share growth
Engineered Solutions Segment Performance
$0
$20
$40
$60
$80
$100
Q1 '05
Q2 '05
Q3 '05
Q4 '05
Q1 '06
$1,000
$1,100
$1,200
$1,300
$1,400
$1,500
Third Party Revenue
ATOI

24
2
Quarter
2006
Outlook
Summary
Industry fundamentals expected to remain
strong
Economic conditions expected to remain
positive globally
Operating improvements to stay on track
Continued energy cost pressures
Other input costs stabilizing
U.S. labor negotiations
nd

25
For Additional Information, Contact:
Tony Thene
Director, Investor Relations
Alcoa
390 Park Avenue
New York, N.Y. 10022-4608
Telephone:  (212) 836-2674
Facsimile:  (212) 836-2813
www.alcoa.com

[Alcoa Logo]

[Alcoa Logo]
Appendix

28
Reconciliation of Return on Capital
Return on Capital (ROC) is presented based on Bloomberg Methodology which calculates ROC based on trailing four
quarters.
1Q'06
4Q'05
3Q'05
2Q'05
1Q'05
Bloomberg
1Q'06
Bloomberg
4Q'05
Bloomberg
3Q'05
Bloomberg
2Q'05
Bloomberg
1Q'05
In Millions
Method
Annlzd
Method
Annlzd
Method
Annlzd
Method
Annlzd
Method
Annlzd
Net Income
1,581
         
$2,432
$1,233
$896
$1,277
$1,156
$1,271
$1,840
$1,215
$1,040
Minority Interest
304
            
$420
$259
$320
$227
$236
$240
$240
$254
$240
Interest Expense (After-tax)
$274
$264
$261
$236
$263
$291
$237
$319
$212
$198
Numerator (Sum Total)
$2,159
$3,116
$1,753
$1,452
$1,767
$1,683
$1,748
$2,399
$1,681
$1,478
Average Balances
Short-term borrowings
$350
$335
$284
$285
$153
$263
$152
$293
$171
$298
Short-term debt
$53
$59
$58
$53
$272
$47
$273
$47
$269
$52
Commercial paper
$1,652
$1,292
$771
$1,037
$946
$1,134
$1,093
$1,368
$818
$1,131
Long-term debt
$5,246
$5,253
$5,312
$5,332
$5,382
$5,450
$5,381
$5,389
$6,022
$5,305
Preferred Stock
$55
$55
$55
$55
$55
$55
$55
$55
$55
$55
Minority interests
$1,280
$1,378
$1,391
$1,333
$1,332
$1,254
$1,253
$1,188
$1,263
$1,293
Common equity
$13,611
$13,596
$13,282
$13,454
$13,045
$13,446
$12,761
$13,324
$12,793
$13,296
Denominator (Sum Total)
$22,247
$21,968
$21,153
$21,549
$21,185
$21,649
$20,968
$21,664
$21,391
$21,430
Return on Capital
9.7%
14.2%
8.3%
6.7%
8.3%
7.8%
8.3%
11.1%
7.9%
6.9%

29
Reconciliation of Adjusted Return on Capital
Return on capital, excluding growth investments is a non-GAAP financial measure.  Management believes that this
measure is meaningful to investors because it provides greater insight with respect to the underlying operating
performance of the company’s productive assets.  The company has significant growth investments underway in its
upstream and downstream businesses, as previously noted, with expected completion dates over the next several
years.  As these investments generally require a period of time before they are productive, management believes that a
return on capital measure excluding these growth investments is more representative of current operating performance.
1Q'06
4Q'05
3Q'05
2Q'05
1Q'05
Bloomberg
1Q'06
Bloomberg
4Q'05
Bloomberg
3Q'05
Bloomberg
2Q'05
Bloomberg
1Q'05
In Millions
Method
Annlzd
Method
Annlzd
Method
Annlzd
Method
Annlzd
Method
Annlzd
Numerator (Sum Total)
$2,159
$3,116
$1,753
$1,452
$1,767
$1,683
$1,748
$2,399
$1,681
$1,478
Russia & Bohai
Net Loss
($86)
($110)
($71)
($91)
($48)
($27)
($41)
($115)
($12)
($49)
Adjusted Net Income
$2,245
$3,226
$1,824
$1,543
$1,815
$1,710
$1,789
$2,514
$1,693
$1,527
Average Balances
Denominator (Sum Total)
$22,247
$21,968
$21,153
$21,549
$21,185
$21,649
$20,968
$21,664
$21,391
$21,430
Capital Projects in Progress,
Russia & Bohai
Capital Base
$2,139
$2,892
$1,981
$2,664
$1,736
$2,177
$1,539
$1,896
$1,423
$1,385
Adjusted Capital Base
$20,108
$19,076
$19,172
$18,885
$19,449
$19,472
$19,429
$19,768
$19,968
$20,045
Return on Capital Excluding
Growth Investments
11.2%
16.9%
9.5%
8.2%
9.3%
8.8%
9.2%
12.7%
8.5%
7.6%

30
Days of Working Capital Definition
In Millions
1Q'05
4Q'05
1Q'06
Add: Receivables from customers, less allowances
$ 3,110
$ 2,914
$ 3,380
Add: Inventories
$ 3,365
$ 3,446
$ 3,778
Less: Accounts payable, trade
$ 2,418
$ 2,659
$ 2,691
Working Capital
$ 4,057
$ 3,701
$ 4,467
Sales
$ 6,221
$ 6,666
$ 7,244
Days of Working Capital *
58.7 d
51.1 d
55.5 d
* Days of Working Capital = Working Capital divided by (Sales/number of days in the quarter)

31

32