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Seizing
Opportunity,
Accelerating
Value 2010 Annual Report and Form 10-K

Table of contents

  • Page 1
    Opportunity, Accelerating Value 2010 Annual Report and Form 10-K Seizing

  • Page 2
    ...as Alcoa® wheels, fastening systems, precision and investment castings, and building systems in addition to its expertise in other light metals such as titanium and nickel-based superalloys. • Sustainability is an integral part of Alcoa's operating practices and the product design and engineering...

  • Page 3
    ... from material 2010 Cash Sustainability Operational Targets and Actual Performance cost increases and currency exchange rates. Procurement1 Overhead Total Capex2 Working Capital • The story is similar with overhead. We had promised $ Millions $ Millions $ Millions Days Working Capital that we...

  • Page 4
    ... recent investments and portfolio changes: • In our joint venture with Ma'aden, the Saudi Arabian Mining Company, we broke ground in October 2010 on the lowest-cost aluminum complex in the world. When complete, the facility will meet the needs of a Middle East hungry for aluminum products to build...

  • Page 5
    ... can sheet provider in Russia, we are targeting 14% revenue growth in Alcoa Russia from 2010-2013, outpacing the 8% market growth. Our forecasts are based on an estimated compound annual growth rate of 6.5% (for the period 2010-2020) for the consumption of aluminum - a doubling of worldwide demand...

  • Page 6
    ... yet another chance to add value to their products. • In the aerospace and industrial gas turbine market, Alcoa is working with global customers like General Electric, Siemens, Rolls Royce and Alstom to offer solutions that enable our customers to design even more complex cooling schemes in...

  • Page 7
    ...system solutions. These innovative solutions transform fastener applications beyond conventional use by integrating the function of lightning strike management with the structural fastening of the airplane. • Alcoa's Kawneer unit, the leading supplier of architectural aluminum products and systems...

  • Page 8
    ...productive member of our communities, making an 2010 Month of Service - Alcoa Bohai, China impact in the causes that are important to our employees and their families. In China, we received the Multinational Company with Contribution to Public Welfare Award for our work improving communities. Giving...

  • Page 9
    ...its charter) Pennsylvania (State of incorporation) 25-0317820 (I.R.S. Employer Identification No.) ALCOA INC. 390 Park Avenue, New York, New York 10022-4608 (Address of principal executive offices) (Zip code) Registrant's telephone numbers: Investor Relations 212) 836-2674 Office of the Secretary...

  • Page 10
    ... Relationships and Related Transactions, and Director Independence ...Principal Accounting Fees and Services ...152 152 152 152 153 Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ...Selected Financial Data ...Management's Discussion and...

  • Page 11
    ... States and Europe generated 50% and 27%, respectively, of Alcoa's sales in 2010. In addition, Alcoa has investments and operating activities in Australia, Brazil, China, Guinea, Iceland, Russia, and Saudi Arabia, all of which present opportunities for substantial growth. Governmental policies, laws...

  • Page 12
    ... charts and related discussion of the company's Bauxite Interests, Alumina Refining and Primary Aluminum Facilities and Capacities, and Flat-Rolled Products, Engineered Products and Solutions and Corporate Facilities provide additional description of Alcoa's businesses. The Alumina segment primarily...

  • Page 13
    ...-term contracts and mining leases. In 2010, Alcoa consumed 38.3 million metric tons (mt) of bauxite from AWAC and its own resources, 6.8 million mt from related third parties and 1.7 million mt from unrelated third parties. Alcoa's present sources of bauxite are sufficient to meet the forecasted...

  • Page 14
    ... 2010 as a result. 7 8 9 10 11 Kingdom of Saudi Arabia Joint Venture In December 2009, Alcoa and Saudi Arabian Mining Company (Ma'aden) entered into an agreement setting forth the terms of a joint venture between them to develop a fully integrated aluminum complex in the Kingdom of Saudi Arabia...

  • Page 15
    ... (36%) Jamaica Jamalco Alcoa Minerals of Jamaica, L.L.C.3 (55%) Clarendon Alumina Production Ltd.6 (45%) Spain San Ciprián Alúmina Española, S.A.3 (100%) Suriname Suralco Suralco3 (55%) AMS8 (45%) United States Point Comfort, TX Alcoa World Alumina LLC3 (100%) TOTAL Country Australia Facility...

  • Page 16
    ...of a secure long-term energy supply in Western Australia. These constraints continue and as such the project remains under suspension. Alcoa is therefore seeking an extension of the 2006 environmental approval for the expansion for a further 5 years. In 2008, AWAC signed a cooperation agreement with...

  • Page 17
    ... and Capacity The company's primary aluminum smelters and their respective capacities are shown in the following table: Alcoa Worldwide Smelting Capacity Nameplate Capacity1 (000 MTPY) 190 Alcoa Consolidated Capacity2 (000 MTPY) 1903 Country Australia Facility Point Henry Portland Brazil Poços...

  • Page 18
    ... competitively priced power and the financial impact of the European Commission decision regarding electricity tariffs, as described in Part I, Item 3. (Legal Proceedings) of this report. The Portovesme plant continues to operate with a new power agreement effective September 1, 2010 through...

  • Page 19
    ... sheet and plate used in the transportation, building and construction and distribution markets. As noted above, Alcoa and Ma'aden entered into an agreement that involves development of a rolling mill in the Kingdom of Saudi Arabia. The joint venture entity, Ma'aden Rolling Company, has signed...

  • Page 20
    ... alloy investment castings, hard alloy extrusions, forgings and fasteners, aluminum wheels, integrated aluminum structural systems and architectural extrusions. These products serve the aerospace, automotive, building and construction, commercial transportation, power generation and defense markets...

  • Page 21
    ..., is a part of Alcoa's Global Building and Construction Systems business, which is a global provider of architectural systems, services and building products to the construction market. In January 2011, Alcoa announced its agreement to purchase the aerospace fastener business of TransDigm Group Inc...

  • Page 22
    ... and aluminum structural systems. The operating results of these two facilities are reported in the Flat-Rolled Products segment. Corporate Facilities The Latin American extrusions business, previously a component of the former Extruded and End Products Segment, is reported in Corporate Facilities...

  • Page 23
    ...of the company's total alumina refining production costs. Electric power accounts for approximately 27% of the company's primary aluminum production costs. Alcoa generates approximately 23% of the power used at its smelters worldwide and generally purchases the remainder under long-term arrangements...

  • Page 24
    ...under which Alcoa was receiving financial benefits to reduce the cost of power purchased from the market to partially operate the Intalco smelter, Alcoa and BPA signed a new contract providing for the sale of physical power at the Northwest Power Act-mandated industrial firm power (IP) rate, for the...

  • Page 25
    ...-priced replacement power supply could not be obtained. Alcoa announced in the first quarter of 2010 that it will permanently close the Eastalco smelter. Australia - Electricity Power is generated from extensive brown coal deposits covered by a long-term mineral lease held by Alcoa of Australia...

  • Page 26
    ...31, 2012. The Fusina smelter was temporarily curtailed due to high energy costs in May 2010. As of June 30, 2010, the Fusina smelter was temporarily idled. The company's smelters at San Ciprián, La Coruña and Avilés, Spain purchase electricity under bilateral power contracts that commenced in May...

  • Page 27
    ...en, at the end of the first quarter of 2009. These smelters have long-term power arrangements in place which continue until at least 2019. Iceland - Electricity Alcoa's Fjarðaál smelter in eastern Iceland began operation in 2007. Central to those operations is a 40-year power contract under which...

  • Page 28
    ... integrated in company manufacturing plants. Integrated thermal management products for consumer electronics have been developed and are being validated by our customers. A number of products were commercialized in 2010 including aluminum tie downs for military ships, new fasteners, primary aluminum...

  • Page 29
    ...Consolidated Financial Statements under the caption "Environmental Matters" on pages 112-115. Employees Total worldwide employment at year-end 2010 was approximately 59,000 employees in 31 countries. About 37,800 of these employees are represented by labor unions. The company believes that relations...

  • Page 30
    ...effective March 1, 2010. He joined Alcoa in 2008 as President of Global Primary Products - United States, responsible for Alcoa's aluminum smelters in the U.S. and its alumina refinery in Pt. Comfort, Texas. In 2009, Mr. Thuestad assumed the new position of Chief Operating Officer for Global Primary...

  • Page 31
    ... and the effects of government intervention. The company implemented a number of operational and financial actions in 2009 and 2010 to improve its cost structure and liquidity, including curtailing production, halting non-critical capital expenditures, accelerating new sourcing strategies for raw...

  • Page 32
    ... expects to meet the energy requirements for its alumina refineries and primary aluminum smelters from internal sources or from long-term contracts, the following factors could affect Alcoa's results of operations significant increases in electricity costs rendering smelter operations uneconomic...

  • Page 33
    ...2009, Alcoa announced that it formed a joint venture with Ma'aden, the Saudi Arabian Mining Company, to develop a fully integrated aluminum complex (including a bauxite mine, alumina refinery, aluminum smelter and rolling mill) in the Kingdom of Saudi Arabia. Although the company has, in relation to...

  • Page 34
    ... financing, increase its borrowing costs, adversely affect the market price of its existing securities, or otherwise impair its business, financial condition and results of operations. Currently, Alcoa's long-term debt is rated BBB- with negative outlook by Standard and Poor's Ratings Services; Baa3...

  • Page 35
    ...legal proceedings or investigations adverse to Alcoa. The company may experience a change in effective tax rates or become subject to unexpected or rising costs associated with business operations or provision of health or welfare benefits to employees due to changes in laws, regulations or policies...

  • Page 36
    ...-end assumptions used by Alcoa to estimate pension or other postretirement benefit income or expense for the following year are the discount rate, the expected long-term rate of return on plan assets, and several assumptions relating to employee workforce (salary increases, medical costs, retirement...

  • Page 37
    ... integration and non-traditional sourcing from numerous geographies, and deployment of company-wide business process models, such as the Alcoa Business System and the Alcoa Enterprise Business Solution (an initiative designed to build a common global infrastructure across Alcoa for data, processes...

  • Page 38
    ... office is located at 390 Park Avenue, New York, New York 10022-4608. Alcoa's corporate center is located at 201 Isabella Street, Pittsburgh, Pennsylvania 15212-5858. The Alcoa Technical Center for research and development is located at 100 Technical Drive, Alcoa Center, Pennsylvania 15069. Alcoa...

  • Page 39
    ...Products and Solutions Facilities section on pages 12-14 of this report. CORPORATE See the table and related text in the Corporate Facilities section on pages 14-15 of this report. Item 3. Legal Proceedings. In the ordinary course of its business, Alcoa is involved in a number of lawsuits and claims...

  • Page 40
    ... of the Virgin Islands, Division of St. Croix for claims related to the sale of Alcoa's former St. Croix alumina refinery to Plaintiffs. Alcoa thereafter removed the case to federal court and after a several year period of discovery and motion practice, a jury trial on the matter took place in St...

  • Page 41
    ... CERCLA cause of action on statute of limitations grounds. In July 2010, the court granted in part and denied in part each defendant's motion for summary judgment. The court granted each defendant's motion as to alleged injury to off-site groundwater and downstream surface water resources but denied...

  • Page 42
    ... claims directly against certain third-party defendants, including AWA and SCA. On January 29, 2010, the court granted plaintiff's motion. On November 15, 2010, plaintiff and all defendants filed motions for summary judgment addressing various issues relating to liability, recoverability of costs...

  • Page 43
    ... reported, in 1996, Alcoa acquired the Fusina, Italy smelter and rolling operations and the Portovesme, Italy smelter (both of which are owned by Alcoa's subsidiary, Alcoa Trasformazioni S.r.l.) from Alumix, an entity owned by the Italian Government. Alcoa also acquired the extrusion plants located...

  • Page 44
    ... power costs at its smelters in Italy subsequent to the tariff end date). The extension was originally through 2010, but the date was changed by legislation adopted by the Italian Parliament effective on August 15, 2009. Prior to expiration of the tariff in 2005, Alcoa had been operating in Italy...

  • Page 45
    ...Act (ERISA) and the Labor-Management Relations Act by requiring plaintiffs, beginning January 1, 2007, to pay health insurance premiums and increased co-payments and co-insurance for certain medical procedures and prescription drugs. Plaintiffs allege these changes to their retiree health care plans...

  • Page 46
    ..., on March 6, 2009, the Philadelphia Gas Works Retirement Fund filed a shareholder derivative suit in the civil division of the Court of Common Pleas of Philadelphia County, Pennsylvania. This action was brought against certain officers and directors of Alcoa claiming breach of fiduciary duty and...

  • Page 47
    ... of shared costs for the upgrade at the power plant and for mining operations. The claims related to the power plant and electricity supply costs were tried before a jury; the claims related to the mining operations were tried before the court. The trials in the case commenced on May 17, 2010 with...

  • Page 48
    ...for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. The company's common stock is listed on the New York Stock Exchange, Inc. (symbol AA). The company's quarterly high and low trading stock prices and dividends per common share for 2010 and 2009 are...

  • Page 49
    ... 2006 2007 2008 2009 2010 Alcoa Inc. $100 $103 $128 $41 $ 60 $ 58 S&P 500® Index 100 116 122 77 97 112 S&P 500® Materials Index 100 119 145 79 117 143 © Copyright 2010 Standard & Poor's, a division of The McGraw-Hill Companies Inc. All rights reserved. Source: Research Data Group, Inc. (www...

  • Page 50
    ...exercise of employee stock options, in each case to the extent applicable during the period indicated. The shares used to satisfy the exercise price related to stock options are not considered part of the publicly announced share repurchase program approved by Alcoa's Board of Directors as described...

  • Page 51
    ... of alumina (kmt) Shipments of aluminum products (kmt) Alcoa's average realized price per metric ton of aluminum Cash dividends declared per common share Total assets Short-term borrowings Commercial paper Long-term debt, including amounts due within one year 2010 $21,013 $ $ 2009 $18,439 2008 $26...

  • Page 52
    ... and Europe generated 50% and 27%, respectively, of Alcoa's sales in 2010. In addition, Alcoa has investments and operating activities in Australia, Brazil, China, Guinea, Iceland, Russia, and Saudi Arabia, all of which present opportunities for substantial growth. Governmental policies, laws and...

  • Page 53
    ...'s alumina and aluminum products. In late 2008, management made the decision to reduce Alcoa's aluminum and alumina production in response to the then significant economic downturn. As a result of this decision, reductions of 750 kmt, or 18%, of annualized output from Alcoa's global smelting system...

  • Page 54
    ... by 204 kmt on an annual basis thereafter and are occurring to help meet anticipated growth in aluminum demand and to meet obligations outlined in power agreements with energy providers. In June 2008, Alcoa temporarily idled half of the aluminum production (three of six operating potlines or 120 kmt...

  • Page 55
    ... half of 2009 related to the Juruti bauxite mine development and São Luís refinery expansion in Brazil, the smelters in Norway (acquired on March 31, 2009), the new Bohai (China) flat-rolled product facility, and a highquality coated sheet line at the Samara (Russia) facility, slightly offset...

  • Page 56
    ... impairments) related to divested and to be divested businesses (Automotive Castings, Global Foil, Transportation Products Europe, and Packaging and Consumer) for, among other items, the settlement of a contract with a former customer, foreign currency movements, working capital adjustments, and...

  • Page 57
    ...off of $84 in engineering costs related to a 1,500 kmt planned expansion of Jamalco's Clarendon, Jamaica refinery. - The Flat-Rolled Products segment was restructured through the following actions Restructuring and downsizing of the Mill Products businesses in Europe and North America, resulting in...

  • Page 58
    ...results would have been as follows: 2010 2009 $ 12 $ 5 145 30 (11) 65 18 64 164 164 43 73 $207 $237 2008 $ 89 94 273 104 45 605 334 $939 Alumina Primary Metals Flat-Rolled Products Engineered Products and Solutions Packaging and Consumer Segment total Corporate Total restructuring and other charges...

  • Page 59
    ... a $10 benefit related to a change in the sale structure of two locations included in the Global Foil business than originally anticipated; and a $7 benefit related to the Elkem/Sapa AB exchange transaction. Partially offsetting these benefits were items related to smelter operations in Italy, which...

  • Page 60
    ... segments: Alumina, Primary Metals, Flat-Rolled Products, and Engineered Products and Solutions (the Packaging and Consumer segment no longer contains any operations as the businesses within this segment were divested during 2008). Segment performance under Alcoa's management reporting system is...

  • Page 61
    ...alumina traders, and distributors. Slightly more than half of Alcoa's alumina production is sold under supply contracts to third parties worldwide, while the remainder is used internally. In 2010, alumina production increased by 1,657 kmt compared to 2009. The increase was mainly driven by the Point...

  • Page 62
    ... as upstream operations) consists of Alcoa's worldwide smelter system. Primary Metals receives alumina, mostly from the Alumina segment, and produces primary aluminum used by Alcoa's fabricating businesses, as well as sold to external customers, aluminum traders, and commodity markets. Results from...

  • Page 63
    ...Norway, in which Alcoa previously held a 50% equity interest. In 2010, aluminum production increased by 22 kmt, mostly due to the smelters located in Norway, as well as a number of small increases at other smelters, but was virtually offset by the smelter curtailments in Tennessee, Massena East, and...

  • Page 64
    ... forgings and fasteners; aluminum wheels; integrated aluminum structural systems; and architectural extrusions used in the aerospace, automotive, building and construction, commercial transportation, and power generation markets. These products are sold directly to customers and through distributors...

  • Page 65
    ... cost savings realized in all businesses. In 2011, improvements in key end markets, such as aerospace and commercial transportation, are anticipated, while productivity improvements are expected to continue. Packaging and Consumer Third-party aluminum shipments (kmt) Third-party sales ATOI 2010...

  • Page 66
    ... by an increase in labor costs (principally due to higher annual incentive and performance compensation and employee benefits costs (employer matching savings plan contributions for U.S. salaried participants were suspended during 2009)); a decrease in Restructuring and other charges, mainly due to...

  • Page 67
    ... drop in realized prices, somewhat offset by the gain related to the acquisition of a BHP Billiton subsidiary in the Republic of Suriname and the absence of the impact of the 2008 gas outage in Western Australia; a decline in Corporate expense, primarily due to reductions in labor costs (mainly as...

  • Page 68
    ... cost structure and liquidity. Operational actions included procurement efficiencies and overhead rationalization to reduce costs and working capital initiatives to yield significant cash improvements. Financial actions included a reduction in the quarterly common stock dividend from $0.17 per share...

  • Page 69
    ... $348, principally related to Alumina Limited's share of AWAC; and $177 in proceeds from employees exercising their stock options; all of which was partially offset by $1,082 for the repurchase of common stock; $556 in dividends paid to shareholders; payments on long-term debt of $204, mainly due to...

  • Page 70
    ... of which are to be used to provide working capital or for other general corporate purposes of Alcoa, including support of Alcoa's commercial paper program. Subject to the terms and conditions of the Credit Agreement, Alcoa may from time to time request increases in lender commitments under the...

  • Page 71
    ... costs related to environmental control in new and expanded facilities of $241), 58% of which related to growth projects, including the São Luís refinery expansion, Juruti bauxite mine development, Estreito hydroelectric power project, and flat-rolled products projects in Bohai (China) and Russia...

  • Page 72
    ... minimum required pension funding and postretirement benefit payments are based on actuarial estimates using current assumptions for discount rates, long-term rate of return on plan assets, rate of compensation increases, and health care cost trend rates. The minimum required contributions for...

  • Page 73
    ... investment related to a joint venture in Saudi Arabia. In December 2009, Alcoa signed an agreement to enter into a joint venture to develop a new aluminum complex in Saudi Arabia, comprised of a bauxite mine, alumina refinery, aluminum smelter, and rolling mill, which will require the Company...

  • Page 74
    ... retirement obligations; the testing of goodwill, equity investments, and properties, plants, and equipment for impairment; estimating fair value of businesses to be divested; pension plans and other postretirement benefits obligations; stock-based compensation; and income taxes. Management uses...

  • Page 75
    ... or expense. Alcoa accounts for interest rate swaps related to its existing long-term debt and hedges of firm customer commitments for aluminum as fair value hedges. As a result, the fair values of the derivatives and changes in the fair values of the underlying hedged items are reported in other...

  • Page 76
    ... units are the Alumina segment, the Primary Metals segment, the Flat-Rolled Products segment, and the soft alloy extrusions business in Brazil, which is included in Corporate. Almost 90% of Alcoa's total goodwill is allocated to three reporting units as follows: Alcoa Fastening Systems (AFS) ($1,009...

  • Page 77
    ... the expected long-term rate of return on plan assets, and several assumptions relating to the employee workforce (salary increases, medical costs, retirement age, and mortality). The interest rate used to discount future estimated liabilities is determined using a Company-specific yield curve model...

  • Page 78
    ...interest rate, dividend yield, volatility, annual forfeiture rate, and exercise behavior. These assumptions may differ significantly between grant dates because of changes in the actual results of these inputs that occur over time. As part of Alcoa's stock-based compensation plan design, individuals...

  • Page 79
    ... buys products from and sells products to various related companies, consisting of entities in which Alcoa retains a 50% or less equity interest, at negotiated arms-length prices between the two parties. These transactions were not material to the financial position or results of operations of Alcoa...

  • Page 80
    ...31, 2010, based on criteria in Internal Control-Integrated Framework issued by the COSO. The effectiveness of the Company's internal control over financial reporting as of December 31, 2010 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in...

  • Page 81
    ... on these financial statements and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform...

  • Page 82
    ... (loss) Earnings per Share Attributable to Alcoa Common Shareholders (S): Basic: Income (loss) from continuing operations Loss from discontinued operations Net income (loss) Diluted: Income (loss) from continuing operations Loss from discontinued operations Net income (loss) 2010 2009 2008 $21,013...

  • Page 83
    ... and deferred credits (L) Liabilities of operations held for sale (B) Total liabilities Commitments and contingencies (N) Convertible securities of subsidiary (I) Equity Alcoa shareholders' equity: Preferred stock (R) Common stock (R) Additional capital Retained earnings Treasury stock, at cost...

  • Page 84
    ... (used for) discontinued operations Cash provided from operations Financing Activities Net change in short-term borrowings (K) Net change in commercial paper (K) Additions to long-term debt (K) Debt issuance costs (K) Payments on long-term debt (K) Proceeds from exercise of employee stock options...

  • Page 85
    ... plans (R) Repurchase of common stock (R) Distributions Contributions (M) Purchase of equity from noncontrolling interest (F) Cumulative effect adjustment due to the adoption of accounting changes related to the measurement date of benefit plans, net of tax (W) Other Balance at December 31, 2008...

  • Page 86
    ... Alcoa Inc. Interests 2010 2009 2008 2010 2009 2008 $ 254 $(1,151) $ (74) $138 $ 61 $ 221 Total 2009 2008 $(1,090) $ 147 For the year ended December 31, Net income (loss) Other comprehensive income (loss), net of tax: Change in unrecognized net actuarial loss and prior service cost/benefit related...

  • Page 87
    ... smelters and mines, the units of production method is used to record depreciation. The following table details the weightedaverage useful lives of structures and machinery and equipment by reporting segment (numbers in years): Segment Alumina Primary Metals Flat-Rolled Products Engineered Products...

  • Page 88
    During 2008, Alcoa completed a review of the estimated useful lives of its alumina refining and aluminum smelting facilities. Such a review was performed because considerable engineering data and other information (readily available due to the construction of the Iceland smelter as well as various ...

  • Page 89
    ... Alumina Primary Metals Flat-Rolled Products Engineered Products and Solutions Software 10 10 10 10 Other intangible assets 40 9 16 Equity Investments. Alcoa invests in a number of privately-held companies, primarily through joint ventures and consortiums, which are accounted for on the equity...

  • Page 90
    ... value. Additionally, Alcoa capitalizes asset retirement costs by increasing the carrying amount of the related long-lived assets and depreciating these assets over their remaining useful life. Certain conditional asset retirement obligations (CAROs) related to alumina refineries, aluminum smelters...

  • Page 91
    ... or expense. Alcoa accounts for interest rate swaps related to its existing long-term debt and hedges of firm customer commitments for aluminum as fair value hedges. As a result, the fair values of the derivatives and changes in the fair values of the underlying hedged items are reported in other...

  • Page 92
    ...with these businesses following their divestiture, primarily in the form of equity participation, or ongoing aluminum or other significant supply contracts. Recently Adopted Accounting Guidance. On September 30, 2009, Alcoa adopted changes issued by the Financial Accounting Standards Board (FASB) to...

  • Page 93
    ... impact on the Consolidated Financial Statements, as management did not elect the fair value option for any other financial instruments or certain other assets and liabilities. On January 1, 2008, Alcoa adopted changes issued by the FASB to fair value accounting as it relates to financial assets and...

  • Page 94
    ... should be grouped by class and valuation techniques used for recurring and nonrecurring fair value measurements. The adoption of these changes had no impact on the Consolidated Financial Statements. Business Combinations and Consolidation Accounting-On January 1, 2010, Alcoa adopted changes...

  • Page 95
    ... Statement of Consolidated Operations for the write off of previously capitalized third-party costs related to potential business acquisitions (see Note D). Also, this guidance was applied to an acquisition completed on March 31, 2009 (see Note F). Effective January 1, 2009, Alcoa adopted...

  • Page 96
    ... existing guidance for accounting for postretirement benefits other than pensions or accounting for deferred compensation contracts if the employer has agreed to maintain a life insurance policy during the employee's retirement or provide the employee with a death benefit based on the substantive...

  • Page 97
    ...Alcoa common shareholders for the year ended December 31, 2008. Recently Issued Accounting Guidance. In December 2010, the FASB issued changes to the disclosure of pro forma information for business combinations. These changes clarify that if a public entity presents comparative financial statements...

  • Page 98
    ... Financial Statements, as Alcoa does not currently have any such arrangements with its customers. B. Discontinued Operations and Assets Held for Sale For the year ended December 31, 2010, there were no active businesses classified as discontinued operations. The Electrical and Electronic Solutions...

  • Page 99
    ..., trade Accrued expenses Liabilities of operations held for sale C. Asset Retirement Obligations Alcoa has recorded AROs related to legal obligations associated with the normal operations of bauxite mining, alumina refining, and aluminum smelting facilities. These AROs consist primarily of costs...

  • Page 100
    ... impairments) related to divested and to be divested businesses (Automotive Castings, Global Foil, Transportation Products Europe, and Packaging and Consumer) for, among other items, the settlement of a contract with a former customer, foreign currency movements, working capital adjustments, and...

  • Page 101
    ...); an aluminum fluoride plant in Point Comfort, TX; a paste plant and cast house in Massena, NY; and one potline at the smelter in Warrick, IN (capacity of 40 kmt-per-year). This decision was made after a comprehensive strategic analysis was performed to determine the best course of action for each...

  • Page 102
    ... of $14 and other exits costs of $3. In addition to the above actions, Alcoa intends to sell its Global Foil (the Sabiñánigo, Spain and Shanghai, China plants were sold in late 2009 - see Note F) and Transportation Products Europe (sold in 2010 - see Note F) businesses in order to streamline its...

  • Page 103
    ...results would have been as follows: 2010 2009 $ 12 $ 5 145 30 (11) 65 18 64 164 164 43 73 $207 $237 2008 $ 89 94 273 104 45 605 334 $939 Alumina Primary Metals Flat-Rolled Products Engineered Products and Solutions Packaging and Consumer Segment total Corporate Total restructuring and other charges...

  • Page 104
    ... 31, 2010, $1,359 of the amount reflected in Corporate is allocated to each of Alcoa's four reportable segments ($166 to Alumina, $858 to Primary Metals, $61 to Flat-Rolled Products, and $274 to Engineered Products and Solutions) included in the table above for purposes of impairment testing (see...

  • Page 105
    ...been materially different from the results reported. 2010 Acquisitions. In July 2010, Alcoa completed an acquisition of the commercial building and construction business of a privately-held company, Traco, for $77. This business, located in Cranberry, Pennsylvania, employing 650 people, is a premier...

  • Page 106
    ...electrical portion of the EES business generated sales of $1,114 in 2008 and, at the time of divestiture, had operations in 13 countries employing approximately 16,200 employees. In early 2010, Alcoa recognized an additional loss of $6 ($9 pretax) in discontinued operations as a result of a contract...

  • Page 107
    ... and extruded non-rigid packaging materials such as pouch, blister packaging, unitizing films, high quality shrink labels, and foil lidding for the pharmaceutical, food and beverage, tobacco, and industrial markets; Closure Systems International, a leading global manufacturer of plastic and aluminum...

  • Page 108
    ... and Baco® branded products; Food Packaging, makers of stock and customer products for the foodservice, supermarket, food processor, and agricultural markets, including foil, film, and both plastic and foil food containers. In 2008, Alcoa made a $47 contingent payment related to a 2003 acquisition...

  • Page 109
    ... to develop a fully-integrated aluminum complex in Saudi Arabia (see below), hydroelectric power construction projects in Brazil (see Note N), a smelter operation in Canada, bauxite mining interests in Guinea and Brazil, and a natural gas pipeline in Australia (see Note N). During 2009, Alcoa also...

  • Page 110
    ... account for a portion or all of Alcoa's remaining equity commitment to the joint venture project in Saudi Arabia. Power for the refinery, smelter, and rolling mill will be supplied under a gas allocation from Saudi Aramco, based on authorization of the Ministry of Petroleum and Mineral Resources...

  • Page 111
    ...realized gains and losses related to these securities were immaterial in 2010 and 2009. J. Other Noncurrent Assets December 31, Intangibles, net (E) Value-added tax receivable Cash surrender value of life insurance Prepaid gas transmission contract Deferred mining costs, net Unamortized debt expense...

  • Page 112
    ... related to interest swap contracts accounted for as fair value hedges (see the Derivatives section of Note X). The principal amount of long-term debt maturing in each of the next five years is $231 in 2011, $490 in 2012, $1,464 in 2013, $775 in 2014, and $44 in 2015. Public Debt-On August 1, 2010...

  • Page 113
    ... notes have the option to convert their notes into shares of Alcoa's common stock at any time prior to the close of business on the second scheduled trading day (March 13, 2014) immediately preceding the stated maturity date (March 15, 2014). The initial conversion rate for the convertible...

  • Page 114
    ... and was used to pay for certain expenditures of the Juruti bauxite mine development. Interest on two of the subloans totaling $257 (R$600) was a U.S. dollar rate of interest equal to the average cost incurred by BNDES in raising capital outside of Brazil, 4.16% and 4.25% as of December 31, 2010 and...

  • Page 115
    ..., and was used to pay for certain expenditures of the Juruti bauxite mine development. Interest on four of the subloans totaling $233 (R$470) is a Brazil real rate of interest equal to BNDES' long-term interest rate, 6.00% as of December 31, 2010 and 2009, plus a weighted-average margin of 2.13...

  • Page 116
    ... in accordance with the commercial terms negotiated with its vendors. Alcoa records imputed interest related to these arrangements as interest expense in the Statement of Consolidated Operations. The remaining amount of short-term borrowings represents working capital loans at various subsidiaries...

  • Page 117
    ... stock (see Note R). L. Other Noncurrent Liabilities and Deferred Credits December 31, Fair value of derivative contracts (X) Asset retirement obligations (C) Deferred income taxes (T) Accrued compensation and retirement costs Environmental remediation (N) Deferred alumina sales revenue Other 2010...

  • Page 118
    ...Act (ERISA) and the Labor-Management Relations Act by requiring plaintiffs, beginning January 1, 2007, to pay health insurance premiums and increased co-payments and co-insurance for certain medical procedures and prescription drugs. Plaintiffs allege these changes to their retiree health care plans...

  • Page 119
    ...uneconomical power costs. In February 2010, management agreed to continue to operate its smelters in Italy for up to six months while a long-term solution to address increased power costs could be negotiated. Also in February 2010, the Italian Government issued a decree, which was converted into law...

  • Page 120
    ... discharges into nearby rivers from both smelters in Massena, NY (separate from matter below); a reversal of $9 for previous charges related to a facility located in Russia due to new information; and a net increase of $11 associated with a number of other sites. In 2009, the remediation reserve was...

  • Page 121
    ... in 2011 or later. Vancouver, WA-In 1987, Alcoa sold its Vancouver smelter to a company that is now known as Evergreen Aluminum (Evergreen). The purchase and sale agreement contained a provision that Alcoa retain liability for any environmental issues that arise subsequent to the sale that pre-date...

  • Page 122
    ... in 2009, Alcoa increased the reserve by $3. Investments. Alumínio, a wholly-owned subsidiary of Alcoa, is a participant in several hydroelectric power construction projects in Brazil for purposes of increasing its energy self-sufficiency and providing a long-term, low-cost source of power for its...

  • Page 123
    ... has an agreement to purchase gas transmission services from the DBNGP. Alcoa's maximum exposure to loss on the investment and the related contract is approximately $480 (A$470) as of December 31, 2010. Purchase Obligations. Alcoa is party to unconditional purchase obligations for energy that expire...

  • Page 124
    ... lease agreements. Total expense from continuing operations for all leases was $260 in 2010, $249 in 2009, and $275 in 2008. Under long-term operating leases, minimum annual rentals are $244 in 2011, $205 in 2012, $121 in 2013, $95 in 2014, $84 in 2015, and $199 thereafter. Letters of Credit. Alcoa...

  • Page 125
    ...Alcoa's products are used worldwide in transportation (including aerospace, automotive, truck, trailer, rail, and shipping), packaging, building and construction, oil and gas, defense, and industrial applications. Total export sales from the U.S. included in continuing operations were $1,802 in 2010...

  • Page 126
    ... forgings and fasteners; aluminum wheels; integrated aluminum structural systems; and architectural extrusions used in the aerospace, automotive, building and construction, commercial transportation, and power generation markets. These products are sold directly to customers and through distributors...

  • Page 127
    Selected financial information of Alcoa's reportable segments was as follows: FlatRolled Products $6,277 180 $6,457 $ 238 92 220 $6,069 113 $6,182 $ 227 48 (49) $8,966 218 $9,184 $ 216 35 (3) Alumina 2010 Sales: Third-party sales Intersegment sales Total sales Profit and loss: Equity income ...

  • Page 128
    ...,654 (3,483) 268 2008 $33,574 (6,948) 275 Consolidated sales $21,013 $18,439 $26,901 * For all periods presented, the Corporate amount includes third-party sales of three soft alloy extrusion facilities located in Brazil. 2010 Net income (loss) attributable to Alcoa: Total segment ATOI Unallocated...

  • Page 129
    ... 31, Long-lived assets: Brazil U.S. Australia Iceland Canada Norway Russia Spain Jamaica China Other 2010 $ 5,364 4,612 3,380 1,633 1,440 981 554 483 435 410 869 $20,161 2009 $ 4,653 4,899 3,062 1,687 1,528 1,084 587 541 449 403 935 $19,828 R. Preferred and Common Stock Preferred Stock. Alcoa has...

  • Page 130
    ... used for general corporate purposes. In March 2009, the quarterly common stock dividend was reduced from $0.17 per share to $0.03 per share in connection with a series of financial actions initiated to improve liquidity. As of December 31, 2010, 110 million and 102 million shares of common stock...

  • Page 131
    ...: Stock option grants Stock award grants Total compensation expense before income taxes Benefit for income taxes Total compensation expense, net of income taxes $44 40 84 27 $57 2009 $53 34 87 29 $58 2008 $15 79 94 31 $63 As part of Alcoa's stock-based compensation plan design, individuals...

  • Page 132
    ... rates at the time of the grant based on the contractual life of the option. In 2008, the dividend yield was based on a five-year average. For 2009, the dividend yield was based on a three-month average as a result of the significant decline in Alcoa's stock price in 2008 due to the then global...

  • Page 133
    ...47.53 Total Intrinsic Value $51 $51 In addition to stock option awards, the Company has granted stock awards and performance share awards, both of which vest three years from the date of grant. Performance share awards are issued at target and the final award amount is determined at the end of the...

  • Page 134
    ... these awards do not share in any loss generated by Alcoa. Effective January 1, 2010, new grants of stock and performance awards do not contain a nonforfeitable right to dividends during the vesting period. As a result, an employee will forfeit the right to dividends accrued on unvested awards if...

  • Page 135
    ... to common equity Less: dividends and undistributed earnings allocated to participating securities Income (loss) from continuing operations available to Alcoa common shareholders Average shares outstanding-basic Effect of dilutive securities: Stock options Stock and performance awards Convertible...

  • Page 136
    ...tax rate and law changes (5.1) 4.2 3.5 Reorganization of equity investment 4.7 Items related to smelter operations in Italy* (9.3) Tax law change related to Medicare Part D 14.4 Release of valuation allowances (10.6) 2.3 Amortization of goodwill (5.2) 3.5 (4.1) Other (2.6) 2.3 0.8 Effective tax rate...

  • Page 137
    ... Care and Education Reconciliation Act of 2010 (the "HCERA" and, together with PPACA, the "Acts"), which makes various amendments to certain aspects of the PPACA, was signed into law. The Acts effectively change the tax treatment of federal subsidies paid to sponsors of retiree health benefit plans...

  • Page 138
    ...000 at December 31, 2010. Management has no plans to distribute such earnings in the foreseeable future. It is not practical to determine the deferred tax liability on these earnings. Alcoa and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and foreign...

  • Page 139
    ... to state tax liabilities, which are presented before any offset for federal tax benefits. The effect of unrecognized tax benefits, if recorded, that would impact the annual effective tax rate for 2010, 2009, and 2008 would be approximately 4%, 1%, and 2%, respectively, of pretax book income. Alcoa...

  • Page 140
    ... due. Most U.S. salaried and non-union hourly employees hired after March 1, 2006 participate in a defined contribution plan instead of a defined benefit plan. Alcoa also maintains health care and life insurance benefit plans covering eligible U.S. retired employees and certain retirees from foreign...

  • Page 141
    ... of accumulated net actuarial loss Prior service cost Amortization of prior service (cost) benefit Total, before tax effect Less: Amounts attributed to joint venture partners Net amount recognized, before tax effect * Other postretirement benefits 2010 2009 $ 3,038 21 175 8 (75) (6) (287...

  • Page 142
    ... benefit cost for U.S pension plans was $155, $135, and $110, respectively. (2) In 2010, 2009, and 2008, net periodic benefit cost for other postretirement benefits reflects a reduction of $39, $42, and $42, respectively, related to the recognition of the federal subsidy awarded under Medicare Part...

  • Page 143
    ... plans did not differ materially): 2010 2009 2008 Discount rate* 6.15% 6.40% 6.20% Expected long-term rate of return on plan assets 8.75 8.75 9.00 Rate of compensation increase 3.50 4.00 4.00 * In all periods presented, the respective discount rates were used to determine net periodic benefit cost...

  • Page 144
    ... be using 8.50% as its expected long-term rate of return for 2011. This rate again falls within the range of the 20-year moving average of actual performance and the expected future return developed by asset class. Assumed health care cost trend rates for U.S. other postretirement benefit plans were...

  • Page 145
    ... direct investments in the stock of publicly traded companies and are valued based on the closing price reported in an active market on which the individual securities are traded. As such, the direct investments are generally classified in Level 1. Also, these securities consist of the plans' share...

  • Page 146
    ... 2009, cash contributions to Alcoa's pension plans were $113 and $128. Also in 2010, Alcoa contributed newly issued shares (see Note R) of its common stock (valued at $600) to a master trust that holds the assets of certain U.S. defined benefit pension plans in a private placement transaction. These...

  • Page 147
    ... chief financial officer, and other officers and employees that the chief executive officer selects. The SRMC reports to the Board of Directors on the scope of its activities. The aluminum, energy, interest rate, and foreign exchange contracts are held for purposes other than trading. They are used...

  • Page 148
    ...$ 6 Energy contracts 1 Other noncurrent assets: Aluminum contracts 3 Foreign exchange contracts 1 Total derivatives not designated as hedging instruments $ 4 $ 10 Less margin held: Prepaid expenses and other current assets: Aluminum contracts $ 4 $ 22 Energy contracts 1 Interest rate contracts 13 19...

  • Page 149
    ...change (increase or decrease of 10%) in the market prices or rates that existed at December 31, 2010: Fair value asset/(liability) $(748) (16) 3 43 Index change of + / - 10% $204 226 5 7 Aluminum contracts Energy contracts Foreign exchange contracts Interest rate contracts Fair value is defined as...

  • Page 150
    ... contracts). For periods beyond the term of quoted market prices for aluminum, Alcoa uses a model that estimates the long-term price of aluminum based on anticipated changes in worldwide supply and demand. For periods beyond the term of quoted market prices for energy, management has developed...

  • Page 151
    ... held at December 31, 2010 and 2009: Sales $ - $ Cost of goods sold Other income, net-decrease (increase) 22 * In 2009, there was an indirect purchase of a Level 3 embedded derivative in a power contract, which is linked to the LME and a foreign exchange rate, related to the Elkem transaction (see...

  • Page 152
    ... and losses were included in Cost of goods sold on the accompanying Statement of Consolidated Operations. Additionally, a financial contract related to the same U.S. smelter utilized by management to hedge the price of electricity of the aforementioned power contract no longer qualified for cash...

  • Page 153
    ... Location of Gain or (Loss) Recognized in Earnings on Hedged Items Sales Interest expense Other income, net Aluminum. Alcoa is a leading global producer of primary aluminum and fabricated aluminum products. As a condition of sale, customers often require Alcoa to enter into long-term, fixed-price...

  • Page 154
    ... of these embedded derivatives have been designated as cash flow hedges of future sales of aluminum. In 2010, Alcoa entered into contracts to hedge the anticipated power requirements at two smelters in Australia. These derivatives hedge forecasted power purchases through December 2036. On March 31...

  • Page 155
    ...: December 31, Aluminum contracts (kmt) Energy contracts: Electricity (megawatt hours) Natural gas (million British thermal units) Fuel oil (metric tons) Foreign exchange contracts Other Alcoa has also entered into certain derivatives to minimize its price risk related to other customer sales and...

  • Page 156
    ... Financial Statements or disclosure in the Notes to the Consolidated Financial Statements, except as follows. On January 24, 2011, Alcoa contributed 36,518,563 newly issued shares of its common stock to a master trust that holds the assets of certain U.S. defined benefit pension plans in a private...

  • Page 157
    .... On January 28, 2011, Alcoa agreed to purchase the aerospace fastener business of TransDigm Group Inc. for approximately $240. This business is a leading global designer, producer, and supplier of highly engineered aircraft components, with three locations (one in the state of California and two in...

  • Page 158
    ... Financial Information (unaudited) Quarterly Data (dollars in millions, except per-share amounts) First 2010 Sales Amounts attributable to Alcoa common shareholders: (Loss) income from continuing operations Loss from discontinued operations Net (loss) income Earnings per share attributable to Alcoa...

  • Page 159
    ... Management's Annual Report on Internal Control over Financial Reporting Management's Report on Internal Control over Financial Reporting is included in Part II, Item 8 of this Form 10-K beginning on page 71. (c) Attestation Report of the Registered Public Accounting Firm The effectiveness of Alcoa...

  • Page 160
    ... under the caption "Executive Compensation - Equity Compensation Plan Information" of the Proxy Statement and is incorporated by reference. The information required by Item 403 of Regulation S-K is contained under the captions "Alcoa Stock Ownership - Stock Ownership of Certain Beneficial Owners...

  • Page 161
    ... 15. Exhibits, Financial Statement Schedules. (a) The consolidated financial statements and exhibits listed below are filed as part of this report. (1) The company's consolidated financial statements, the notes thereto and the report of the Independent Registered Public Accounting Firm are on pages...

  • Page 162
    ... dated August 3, 2010. Alcoa Retirement Savings Plan for Fastener Systems and Commercial Windows Employees, incorporated by reference to exhibit 4(c) to the company's Form S-8 Registration Statement dated November 23, 2010. Alcoa Retirement Savings Plan for Mill Products Employees, incorporated by...

  • Page 163
    ... on Form 10-Q for the quarter ended September 30, 2008. 10(h). Aluminum Project Framework Shareholders' Agreement, dated December 20, 2009, between Alcoa Inc. and Saudi Arabian Mining Company (Ma'aden), incorporated by reference to exhibit 10(i) to the company's Annual Report on Form 10-K for the...

  • Page 164
    ..., 2009. 10(m)(5). Amendment to the Alcoa Stock Acquisition Plan, effective January 1, 2011. 10(n). Employees' Excess Benefits Plan, Plan A, incorporated by reference to exhibit 10(b) to the company's Annual Report on Form 10-K (Commission file number 1-3610) for the year ended December 31, 1980. 10...

  • Page 165
    ... to Employees' Excess Benefits Plan A, effective January 1, 2011. 10(o). 2004 Summary Description of the Alcoa Incentive Compensation Plan, incorporated by reference to exhibit 10(g) to the company's Quarterly Report on Form 10-Q (Commission file number 1-3610) for the quarter ended September...

  • Page 166
    ... Compensation Plan, effective January 1, 1997, incorporated by reference to exhibit 10(h) to the company's Quarterly Report on Form 10-Q (Commission file number 1-3610) for the quarter ended September 30, 2004. Form of Indemnity Agreement between the company and individual directors or officers...

  • Page 167
    ...2011. 10(aa). Terms and Conditions for Special Retention Awards under the 2009 Alcoa Stock Incentive Plan, effective January 1, 2010, incorporated by reference to exhibit 10(e) to company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2010. Alcoa Supplemental Pension Plan for Senior...

  • Page 168
    ...Form of Agreement for Stock Awards, effective January 1, 2004, incorporated by reference to exhibit 10(b) to the company's Quarterly Report on Form 10-Q (Commission file number 1-3610) for the quarter ended September 30, 2004. Form of Agreement for Performance Share Awards, effective January 1, 2004...

  • Page 169
    ...'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2010. Description of Non-Employee Director Compensation incorporated by reference to exhibit 10 to the company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2007. Form of Award Agreement for Stock Options, effective...

  • Page 170
    .... 10(yy). Global Expatriate Employee Policy (pre-January 1, 2003), incorporated by reference to exhibit 10(uu) to the company's Annual Report on Form 10-K (Commission file number 1-3610) for the year ended December 31, 2005. Form of Special Retention Stock Award Agreement, effective July 14, 2006...

  • Page 171
    ...101. LAB 101. PRE * Director Plan: You Make a Difference Award, incorporated by reference to exhibit 10(uu) to the company's Annual Report on Form 10-K for the year ended December 31, 2008. Form of Award Agreement for Stock Options, effective January 1, 2010, incorporated by reference to exhibit 10...

  • Page 172
    ... the undersigned, thereunto duly authorized. ALCOA INC. February 17, 2011 By Graeme W. Bottger Vice President and Controller (Also signing as Principal Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons...

  • Page 173
    ... ENDED DECEMBER 31, (in millions, except ratios) 2010 2009 2008 2007 2006 Earnings: Income (loss) from continuing operations before income taxes Noncontrolling interests' share of earnings of majority-owned subsidiaries without fixed charges Equity income Fixed charges added to earnings Distributed...

  • Page 174
    ... Corporation Howmet Castings & Services, Inc. Alcoa International Holdings Company Alcoa Australian Holdings Pty. Ltd. Alcoa of Australia Limited1 Alcoa of Australia Rolled Products Pty. Ltd. Alcoa (China) Investment Company Ltd. Alcoa Inter-America, Inc. Alcoa International (Asia) Limited Alcoa...

  • Page 175
    ... that term is defined in Regulation S-X under the Securities Exchange Act of 1934. 1 2 3 Owned directly or indirectly 60% by the registrant and 40% by Alumina Limited. Registered to do business in Tennessee under the names Tapoco and APG Trading, in Indiana under the name of AGC, in North Carolina...

  • Page 176
    ...333-168428, and 333-170801) of Alcoa Inc. and its subsidiaries of our report dated February 17, 2011 relating to the consolidated financial statements and the effectiveness of internal control over financing reporting, which appears in this Form 10-K. Pittsburgh, Pennsylvania February 17, 2011 168

  • Page 177
    ...and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a) Designed such disclosure controls and procedures, or...

  • Page 178
    ...and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a) Designed such disclosure controls and procedures, or...

  • Page 179
    ... 63 of Title 18, United States Code), each of the undersigned officers of Alcoa Inc., a Pennsylvania corporation (the "Company"), does hereby certify that: The Annual Report on Form 10-K for the year ended December 31, 2010 (the "Form 10-K") of the Company fully complies with the requirements of...

  • Page 180
    ...23) $ (0.10) Diluted earnings per share(6) 0.24 (1.23) (0.10) Dividends declared 0.12 0.26 0.68 Book value(7) 13.26 12.70 14.60 Price range: High 17.60 16.51 44.77 Low 9.81 4.97 6.80 Other Data Number of employees 59,000 59,000 87,000 (1) Reflects the cumulative effect of the accounting change for...

  • Page 181
    ... of the annual shareholders meeting held in the year following the year listed and include registered shareholders and beneficial owners holding stock through banks, brokers, or other nominees. Represents earnings per share on net income (loss) attributable to Alcoa common shareholders. Book value...

  • Page 182
    ... quarter ended March 31, 2010 related to unbenefitted losses in Russia, China, and Italy ($10); • for the quarter ended March 31, 2010, charges for a change in the tax treatment of federal subsidies received related to prescription drug benefits provided under certain retiree health benefit plans...

  • Page 183
    ...: Accounts payable, trade Working Capital Sales Days Working Capital Days Working Capital = Working Capital (average of three month-end amounts) divided by (Sales/number of days in the quarter) * During the fourth quarter of 2009, each of the monthly balances of Receivables from customers reflected...

  • Page 184
    ... Chief Investment Officer, Pension Plan Investments Nicholas J. Ashooh Vice President - Corporate Affairs Franklin L. Feder Vice President President, Global Primary Products - Latin America and Caribbean Tony R. Thene Vice President Chief Financial Officer, Engineered Products and Solutions...

  • Page 185
    ..., 390 Park Avenue, New York, NY 10022-4608, call 1 212 836 2674, or e-mail [email protected]. Other Publications For more information on Alcoa Foundation and Alcoa community investments, visit www.alcoa.com under ''community'' or www.alcoafoundation.com. For Alcoa's 2010 Sustainability...

  • Page 186
    .... We live our Values and measure our success by the success of our customers, shareholders, communities and people. Alcoa Corporate Center 201 Isabella Street • Pittsburgh, PA 15212-5858 Telephone: 1 412 553 4545 • Fax: 1 412 553 4498 Internet: www.alcoa.com Alcoa Inc. is incorporated in the...