May 6, 2020

COVID-19 Update

Alcoa Chairman and Chief Executive Officer Roy Harvey addressed two questions related to the COVID-19 pandemic, submitted for the Company’s 2020 Annual Meeting of Stockholders. The meeting was conducted virtually on May 6, 2020.

Below is a transcript of Mr. Harvey’s comments related to COVID-19 and Alcoa’s actions:

What are you doing to keep your people and communities safe, and operations running during the current coronavirus pandemic?

Mr. Harvey: “Our most important objective is the health and safety of our global workforce. We have implemented comprehensive measures to minimize the risk of exposure to the COVID-19 virus across all our facilities, instituting protocols that align with the U.S. Centers for Disease Control and Prevention, the World Health Organization, and other public health authorities.

“The measures we have taken to protect our people include suspending all non-essential travel, which has been in place since February, adjusting shift patterns, instituting additional hygiene protocols, and ensuring the exercise of social distancing measures. We’ve authorized employees to work from home where practical and possible. Alcoa’s global crisis response team is monitoring reported cases; those who may be ill or were exposed to the virus are observing quarantine protocols to minimize the risk of exposure for others.

“These measures not only keep our people and communities safe but have also made it possible for all of Alcoa’s bauxite mines, alumina refineries, and aluminum smelters to remain in operation throughout this pandemic.

“In addition, the Alcoa Foundation has allocated a total of $4 million that can be used in our local communities for humanitarian aid projects. Each location is working with qualifying non-profits to allocate this funding towards programs that have the greatest impact.”

How is Alcoa positioned for this pandemic?

Mr. Harvey: “Since the launch of our company in November 2016, Alcoa has been relentlessly focused on improving our portfolio and our balance sheet, while remaining committed to our values to Act with Integrity, Operate with Excellence, and Care for People.

“Over the last three and a half years we have improved our portfolio through a combination of divestment, closure and investment opportunities. For example, we divested the Portovesme smelter in Italy and the rolling mill minority interest in Saudi Arabia, and the Avilés and La Coruña facilities in Spain. We also terminated the Rockdale power contract and closed the site, readying it for sale.

“Alternatively, we initiated the Deschambault smelter creep project to grow its capacity, began restart of the Bécancour smelter (now ~85% complete), and launched the ELYSISTM joint venture with Rio Tinto, which is working towards commercializing the world’s first carbon-free aluminum smelting process.

“While we have strengthened the Company since Separation, we launched a new, comprehensive strategy in the second half of 2019 focusing on three key actions – a new operating model to improve decision making and reduce overhead, the sale of non-core assets, and a multiyear capacity review of our mines, refineries and smelters. In January of this year, we completed the sale of our Gum Springs treatment facility in a deal worth $250 million, with $200 million received at closing.

“In February, we announced two other programs for 2020 to strengthen the company: driving leaner working capital by reducing inventory and optimizing contract terms, and generating savings from sustainable, annual productivity improvements.

“Though these five previously announced actions provided a foundation for us to weather this pandemic, we are undertaking additional initiatives to improve our position in 2020. These actions include reducing capital expenditures, delaying or deferring certain other payments, and implementing global hiring and travel restrictions.

“Together with the cash proceeds from the completed Gum Springs sale, we are targeting $900 million from these cash actions this year.”