1999 Q2 Page 1 of 3 Alcoa's Earnings Momentum Continues PITTSBURGH -(BUSINESS WIRE)- July 7, 1999 - Alcoa today reported net income of $240.0 million (65 cents per common share) for the second quarter of 1999 compared with net income of $207.1 million (62 cents per share) for the 1998 second quarter. (Average common shares outstanding increased about 11% from 332 million to 367 million due to the Alumax acquisition.) For the first half of 1999, net income was $461.1 million, or $1.25 per common share, compared with $417.0 million, or $1.25 per share, for the comparable 1998 period. "We are experiencing the bottom-line impact of productivity improvements and the elimination of waste as Alcoa employees around the world continue to learn and apply the Alcoa Business System," said President and CEO Alain Belda. 1999 ---Revenues $4,032.7 Net Income 240.0 Earnings per Share .65 Average Common Shares Outstanding 367 Second Quarter 1998 %Change ---------- 1999 ---- Six Months 1998 %Change ---- ------- $3,587.0 207.1 12.4 15.9 $8,017.4 461.1 $7,032.1 417.0 14.0 10.6 .62 4.8 1.25 1.25 0 332 10.5 367 334 9.9 (in millions except per share amounts) Return on shareholders' equity for the 1999 first half, annualized, was 14.8%, compared with 18.3% in the first half of 1998. Aluminum product shipments were 1,117,000 metric tons (mt) for the 1999 second quarter, compared with 866,000 mt in the year-ago quarter. Shipments for the first half of 1999 were 2,249,000 mt compared with 1,644,000 mt in the 1998 period. Founded in 1888, Alcoa is the world's leading producer of aluminum and alumina and a major participant in all segments of the industry: mining, refining, smelting, fabricating and recycling. Alcoa serves customers worldwide in the packaging, automotive, aerospace, construction and other markets with a great variety of fabricated and finished products. The company has 215 operating locations in 31 countries. Financial and operating data for Alcoa and its subsidiaries follow. FINANCIAL REPORT Alcoa and subsidiaries (in millions except share and ton amounts) (UNAUDITED) 1999 Q2 Page 2 of 3 Second quarter For the period ended June 30 Sales Other income 1999 $ 4,032.7 42.8 $ 3,587.0 18.3 4,075.5 3,605.3 3,140.4 2,787.5 202.9 30.4 156.7 27.9 220.7 49.5 186.1 41.8 3,643.9 3,200.0 431.6 138.1 405.3 135.8 293.5 269.5 (53.5) (62.4) Cost of goods sold Selling, general administrative and other expenses Research and development expenses Provision for depreciation and depletion Interest expense Income from operations before taxes on income Provision for taxes on income Income from operations Less: Minority interests' share Net Income 1998 $ 240.0 $ 207.1 Earnings per common share: Basic Diluted $ $ 0.65 0.64 $ $ 0.62 0.62 Translation and exchange adjustments included in net income $ (0.4) $ (1.8) Shipments of aluminum products (metric tons) 1,117,000 866,000 FINANCIAL REPORT Alcoa and subsidiaries (in millions except share and ton amounts) (UNAUDITED) Six months For the period ended June 30 Sales Other income Cost of goods sold 1999 1998 $ 8,017.4 39.2 $ 7,032.1 46.4 8,056.6 7,078.5 6,268.0 5,434.9 1999 Q2 Page 3 of 3 Cost of goods sold Selling, general administrative and other expenses Research and development expenses Provision for depreciation and depletion Interest expense Income from operations before taxes on income Provision for taxes on income Income from operations Less: Minority interests' share Net income before extraordinary loss 6,268.0 5,434.9 394.5 57.8 313.4 52.4 439.4 102.1 370.9 81.0 7,261.8 6,252.6 794.8 254.3 825.9 276.7 540.5 549.2 (79.4) (132.2) $ 461.1 $ 417.0 Net Income $ 461.1 $ 417.0 Earnings per common share: Basic Diluted $ $ 1.25 1.23 $ $ 1.25 1.24 Average number of shares used to compute: Basic earnings per common share 367,057,467 Diluted earnings per common share 373,988,055 Shares outstanding at end of period Translation and exchange adjustments included in net income Shipments of aluminum products (metric tons) Return on average shareholders' equity 366,904,700 $ (9.8) 2,249,000 14.8% 333,987,182 336,022,480 329,596,684 $ (4.8) 1,644,000 18.3%