FINANCIAL REPORT Alcoa and subsidiaries (in millions except share and ton amounts) (UNAUDITED) For the period ended December 31 Sales and operating revenues Other income 2000 $ 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 Fourth quarter 1999 6,560 15 6,575 $ 4,253 46 4,299 5,014 3,148 295 60 342 140 5,851 255 37 224 42 3,706 724 232 593 151 492 442 100 108 NET INCOME $ 392 $ 334 Earnings per common share: Basic $ 0.45 $ 0.46 $ 0.45 $ 0.44 Diluted Average number of shares used to compute: Basic earnings per common share 865,152,223 Diluted earnings per common share 872,352,602 Translation and exchange adjustments included in net income $ Shipments of aluminum products (metric tons) (4.2) 1,485,000 733,827,958 750,750,518 $ 2.8 1,129,000 FINANCIAL REPORT Alcoa and subsidiaries (in millions except share and ton amounts) (UNAUDITED) For the period ended December 31 Sales and operating revenues Other income 2000 $ 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 Income before cumulative effect Cumulative effect of accounting change for revenue recognition Diluted (before cumulative effect) Diluted (after cumulative effect) 22,936 154 23,090 $ 16,323 124 16,447 17,342 12,536 1,108 194 1,207 427 20,278 851 128 888 195 14,598 2,812 942 1,849 553 1,870 1,296 381 242 1,489 1,054 (5) NET INCOME Earnings per common share: Basic (before cumulative effect) Basic (after cumulative effect) Twelve months 1999 $ 0 1,484 $ 1,054 $ $ 1.83 1.82 $ $ 1.43 1.43 $ $ 1.81 1.80 $ $ 1.41 1.41 Average number of shares used to compute: Basic earnings per common share 814,229,329 Diluted earnings per common share 823,172,824 733,888,730 747 289 744 Shares outstanding at the end of period 735,497,996 865,517,240 Translation and exchange adjustments included in net income Shipments of aluminum products (metric tons) Return on average shareholders' equity $ (7.8) $ (8.3) 5,398,000 4,478,000 16.8% 17.2% Consolidated Third- Party Revenues Alumina and Chemicals Primary Metals Flat-rolled products Engineered Products Packaging & Consumer Other Total Consolidated Intersegment Revenues Alumina and Chemicals Primary Metals Flat-rolled products Engineered Products Packaging & Consumer Other Total 4Q99 1999 1Q00 2Q00 3Q00 4Q00 2000 492 628 1,312 930 205 686 4,253 1,842 2,241 5,113 3,728 801 2,592 16,317 540 611 1,404 1,053 203 698 4,509 515 852 1,394 1,296 524 988 5,569 529 1,049 1,361 1,586 631 1,142 6,298 524 1,244 1,287 1,536 726 1,243 6,560 2,108 3,756 5,446 5,471 2,084 4,071 22,936 4Q99 1999 1Q00 2Q00 3Q00 4Q00 2000 250 850 13 13 0 0 1,126 274 832 29 15 0 0 1,150 294 936 29 18 0 0 1,277 286 886 26 16 0 0 1,214 1Q00 2Q00 3Q00 4Q00 259 668 11 14 0 0 952 925 2,793 51 26 0 0 3,795 1,104 3,504 97 62 0 0 4,767 Consolidated Third-Party Shipments (KMT’s) Alumina and Chemicals 1,740 7,054 1,833 1,801 1,893 1,945 7,472 Primary Metals Flat-rolled products Engineered Products Packaging & Consumer Other Total Aluminum 383 503 233 2 8 1,129 1,442 1,982 989 9 56 4,478 339 507 266 2 19 1,133 493 504 282 32 50 1,361 574 492 258 37 58 1,419 665 457 255 48 60 1,485 2,071 1,960 1,061 119 187 5,398 0.72 0.67 0.79 0.74 0.77 0.77 0.77 4Q99 102 173 70 32 15 23 415 1999 307 535 281 180 68 118 1,489 1Q00 155 227 73 53 17 30 555 2Q00 140 225 74 62 35 46 582 3Q00 146 254 83 49 38 39 609 4Q00 144 294 69 46 41 49 643 2000 585 1,000 299 210 131 164 2,389 4Q99 1999 1Q00 2Q00 3Q00 555 582 609 Average realized price -Primary After-Tax Operating Income Alumina and Chemicals Primary Metals Flat-rolled products Engineered Products Packaging & Consumer Other Total Reconciliation of after-tax operating income to consolidated net income:AfterTax Operating Income Total after-tax operating income Elimination of intersegment 4Q99 415 1999 1,489 2000 4Q00 2000 643 2,389 (profit) loss 3 Unallocated amounts (net of tax) Interest income Interest expense Minority interest Corporate expense Other Consolidated net income 6 (27) (108) (61) 106 334 (24) (20) 26 (126) (242) (171) 102 1,054 7 (33) (106) (56) 0 347 7 19 (69) (85) (51) (26) 377 (2) (5) (20) 4 (85) (90) (66) (2) 368 10 (91) (100) (54) (11) 392 40 (278) (381) (227) (39) 1,484 Alcoa and subsidiaries Condensed Consolidated Balance Sheet (in millions) (unaudited) December 31 2000 Current assets: Cash and cash equivalents (includes cash of $169 in 2000 and $67 in 1999) Short-term investments Receivables from customers, less allowances: 2000-$69; 1999-$58 Other receivables Inventories Deferred income taxes Prepaid expenses and other current assets Total current assets $ Properties, plants and equipment, at cost Less, accumulated depreciation, depletion and Amortization Net properties, plants and equipment Goodwill, net of accumulated amortization of $344 in 2000 and $221 in 1999 Other assets, including assets held for sale Total assets LIABILITIES Current liabilities: Short-term borrowings Accounts payable, trade Accrued compensation and retirement costs Taxes, including taxes on income Other current liabilities Long-term debt due within one year Total current liabilities Long-term debt, less amount due within one year Accrued postretirement benefits $ 315 56 December 31 1999 $ 237 77 3,461 354 2,703 385 304 7,578 2,199 165 1,618 233 271 4,800 22,600 18,436 9,750 12,850 9,303 9,133 6,003 5,260 $31,691 1,328 1,805 $17,066 2,439 1,876 928 702 1,302 427 7,674 5,267 2,719 $ 343 1,219 582 368 424 67 3,003 2,657 1,720 Other noncurrent liabilities and deferred credits Deferred income taxes Total liabilities MINORITY INTERESTS CONTINGENT LIABILITIES SHAREHOLDERS' EQUITY Preferred stock Common stock Additional capital Retained earnings Treasury stock, at cost Accumulated other comprehensive income Total shareholders' equity Total liabilities and shareholders’ equity 2,126 969 18,755 1,473 437 9,290 1,514 1,458 - - 56 925 5,927 7,127 (1,717) (896) 11,422 $31,691 56 395 1,704 6,061 (1,260) (638) 6,318 $17,066