Alcoa 2000 Annual Report Download - page 39

Name /alcoa/4500 05/31/2001 06:17PM Plate # 0 com g 37 # 1
0099989796
Europe
Other Americ
a
Pacific
USA
13.1 13.3
15.3 16.3
22.9
Revenues by
Geographic Area
billions of dollars
1.3
2.3
1.8
7.7
1.4
7.6
2.1
2.2
1.2
1.8
3.1
9.2
1.0
1.7
3.2
10.4
1.5
2.0
3.9
15.5
37
in Latin America. Average realized prices fell in 1999 in part due to
a change in product mix resulting from the full-year impact of the
Alumax acquisition.
ATOI for Flat-Rolled Products increased in 2000 by 6% as higher
prices offset lower shipments and higher energy costs. RCS ATOI
dropped 7% from 1999 as stronger revenues and a $14 increase
in equity earnings were more than offset by higher energy and scrap
costs. Sheet and plate
ATOI increasedby7%from1999duetoincreased
volumes in Latin America and Europe, while the U.S. remained
constant.
ATOI for foil operations was down due to lower volumes
and increased natural gas prices.
In 1999,
ATOI for Flat-Rolled Products fell 8%, as higher revenues
and cost reductions were overshadowed by lower prices and lower
equity earnings.
RCS ATOI fell 14% due to a decline of $16 in equity
earnings, lower prices and less favorable product mix, partially offset
by cost improvements. Sheet and Plate
ATOI fell 9% as improved
results for U.S. operations, aided by acquisitions, were more than
offset by weaker performance in Latin America and Europe. Partially
offsetting the decline in
RCS and sheet and plate ATOI were improved
results from foil operations and the shutdown of Alcoa Memory
Products in 1999.
IV. Engineered Products
2000 1999 1998
Third-party aluminum shipments (mt) 1,061 989 729
Third-party sales $5,471 $3,728 $3,110
Intersegment sales 62 26 11
Total sales $5,533 $3,754 $3,121
After-tax operating income $ 210 $ 180 $ 183
This segment consists of hard- and soft-alloy extrusions, including
architectural extrusions, super-alloy castings, steel and aluminum
fasteners, aluminum forgings and wheels. These products serve the
transportation, construction and distributor markets. This segment
includes the Reynolds wheel business, as well as the Huck fasteners
and Howmet super-alloy castings businesses acquired as part of the
Cordant acquisition.
In 2000, third-party sales increased 47% primarily due to the
acquisitions of Reynolds and Cordant. The shipment data and average
realized prices per pound of aluminum for this segment were signifi-
cantly impacted in 2000 by the additions of Huck and Howmet, which
produce revenue but have little aluminum components. Extruded
products third-party sales were up 17%, 7% from price increases in
existing businesses and 10% from the recent acquisitions. Shipment
volumes for the existing businesses were down 1%, offset by an
increase in prices. Forged wheel sales increased 34% in 2000 mainly
due to the Reynolds acquisition.
In 1999, third-party shipments for this segment were up 36%,
generating a 20% increase in revenues. Extruded product sales
were up 26% in 1999 from 1998 as shipments rose 43%, offset by a
decrease in average realized price of 12%, primarily due to a change
in product mix as a result of the Alumax acquisition. The continued
strong demand for forged wheels used in sport utility vehicles and
light trucks was a major factor in the higher shipment levels in 1999
compared with 1998.
ATOI for Engineered Products in 2000 increased by 17% to $210.
The impact of acquisitions, primarily Huck and Howmet, increased
ATOI by 23%, offset by a decline in existing businesses. The U.S. and
European engineered and extruded products ATOI fell 37% and 61%
in 2000 and 1999, respectively, as a result of the overall decline in
the transportation market. This was somewhat offset by an increase
of 125% for Latin America due to improvements in market share.
In 1999,
ATOI for Engineered Products fell 2% from 1998 to $180.
The decrease was due to the sale of Alcotec in 1998, as well as
declines in volumes in the extrusion business. These factors were
slightly offset by improved results in Europe due to acquisitions
and in forged products as a result of higher prices and continued
growth in the wheel market.