ASX Announcement 12 January 2016‌

Alcoa Fourth Quarter Earnings Release

Alumina Limited (ASX: AWC) notes Alcoa's quarterly earnings release and attaches it for reference. Selected information from the Alcoa alumina business segment and relevant market data to assist readers in understanding the market, operational and commercial matters of Alcoa World Alumina & Chemicals ("AWAC") is also attached.

Alumina Limited's CEO, Peter Wasow, commented, "Lower alumina and aluminium prices and unfavourable currency movements have negatively impacted margins during the fourth quarter of 2015. Higher production at Australian refineries, continued productivity improvements, energy savings and cost control partially offset these declines. AWAC continues to adjust its portfolio to improve its cost position and ensure continued competitiveness in the prevailing market conditions."

AWAC's production of alumina was 3.7 million tonnes for the quarter.

Alumina Limited received $35.2 million of dividends and distributions from AWAC and made cash capital contributions of $2.4 million to AWAC in the quarter.

Alumina Limited's net debt was approximately US$101 million at the end of December 2015.

About AWAC & Alcoa's Earnings Release

Alumina Limited owns 40% of each of the AWAC entities, which form a part of the Alcoa alumina business segment. The Alcoa primary metals business segment includes the AWAC Point Henry smelting (closed 1 August 2014), Portland smelting and Anglesea power station operations (closed 31 August 2015). Therefore, the AWAC results cannot be directly inferred from the Alcoa earnings release. Further, unlike Alumina Limited, Alcoa reports under US GAAP.

Forward-looking statements

Neither Alumina nor any other person warrants or guarantees the future performance of Alumina or any return on any investment made in Alumina securities. This document may contain certain forward-looking statements, including forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. The words "anticipate", "aim", "believe", "expect", "project", "estimate", "forecast", "intend", "likely", "should", "could", "will", "may", "target", "plan" and other similar expressions (including indications of "objectives") are intended to identify forward-looking statements. Indications of, and guidance on, future financial position and performance and distributions, and statements regarding Alumina's future developments and the market outlook, are also forward- looking statements.

Any forward-looking statements contained in this document are not guarantees of future performance. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of Alumina and its directors, officers, employees and agents that may cause actual results to differ materially from those expressed or implied in such statements.

Those risks, uncertainties and other factors include (without limitation): (a) material adverse changes in global economic conditions, alumina or aluminium industry conditions or the markets served by AWAC; (b) changes in production or development costs, production levels or sales agreements; (c) changes in laws, regulations or policies; (d) changes in alumina or aluminium prices or currency exchange rates; (e) Alumina Limited does not hold a majority interest in AWAC and decisions made by majority vote may not be in the best interests of Alumina Limited; and (f) the other risk factors summarised in Alumina's Annual Report 2015. Readers should not place undue reliance on forward-looking statements. Except as required by law, Alumina disclaims any responsibility to update or revise any forward-looking statements to reflect any new information or any change in the events, conditions or circumstances on which a statement is based or to which it relates.

Stephen Foster Company Secretary

12 January 2016

Investor Contact Media Contact

Nahla Azmy Monica Orbe

(212) 836-2674 (212) 836-2632

[email protected] [email protected]

Alcoa Reports Fourth Quarter 2015 and Full-Year Results

Value-Add delivers solid results and Upstream profitable, overcoming lower alumina and aluminum prices

Portfolio strengthened ahead of separation

4Q 2015 Results

• Net loss of $500 million, or $0.39 per share;

  excluding-special items, net income of $65 million, or $0.04 per share

• Revenue of $5.2 billion, 7 percent revenue increase year-over-year from aerospace and acquisitions more than offset by a 25 percent decrease from lower alumina and aluminum prices, divestitures and closures

• Value-Add businesses: $3.3 billion of revenue, after-tax operating income of $215 million and adjusted EBITDA of $448 million

  • Global Rolled Products: $52 million after-tax operating income; year-over-year auto sheet shipment growth of 18 percent; shifting revenue mix to higher margin products resulted in an adjusted EBITDA per metric ton increase of 19 percent year-over-year

  • Engineered Products and Solutions: record revenue of $1.4 billion as well as

    $123 million after-tax operating income; year-over-year aerospace revenue increased 34 percent

  • Transportation and Construction Solutions: $40 million after-tax operating income and record fourth quarter adjusted EBITDA margin of 14.6 percent

• Upstream businesses: $2.4 billion of revenue, after-tax operating income of $58 million, and adjusted EBITDA of $239 million

  • Sequential price declines in alumina of 24 percent and aluminum of 1 percent (down 43 percent and 28 percent, respectively, in 2015); Alumina profitable and Primary Metals improved adjusted EBITDA per metric ton sequentially

  • Alcoa projecting robust global aluminum demand growth, up 6 percent over 2015, and global alumina and aluminum deficits in 2016

• Productivity gains of $350 million year-over-year across all segments

• $865 million in cash from operations; $467 million in free cash flow

• $1.9 billion of cash on hand

  4Q 2015 Business Highlights

• Aerospace growth strategy delivers: three major multi-year aerospace contracts in the fourth quarter; approximately $9 billion in 2015 contracts, double the amount of 2014

  • More than $2.5 billion in multi-year agreements with Boeing for fastening systems and titanium seat tracks with RTI pull-through

  • $1.5 billion-plus multi-year agreement with GE Aviation for blades, vanes and structural parts

• Aggressive Upstream portfolio actions:

  • Announced curtailments and closures of approximately 25 percent operating smelting and approximately 20 percent operating refining capacity in 2015

• Launched new business improvement programs for 2016:

  • Value-Add to deliver $650 million

  • Upstream to deliver $600 million

  • Above includes overhead reduction across Alcoa with $100 million to be realized in 2016, $225 million over two years

• Two strengthened portfolios on track for separation in the second half of 2016

  • Announced executive management teams for the future Value-Add and Upstream companies

  • Form 10 filing with the U.S. Securities and Exchange Commission targeted by mid-year

    
    

    Full-Year 2015 Results

• Net loss of $121 million, or $0.15 per share;

  excluding special items, net income of $787 million, or $0.56 per share

• Revenue of $22.5 billion, down 6 percent from 2014

• Value-Add portfolio after-tax operating income of $1.0 billion and adjusted EBITDA up 5 percent over 2014

  • Global Rolled Products after-tax operating income of $244 million and 15 percent increase in adjusted EBITDA per metric ton; auto sheet shipments doubled from 2014

  • Engineered Products and Solutions revenue up 27 percent, after-tax operating income of $595 million and adjusted EBITDA up 9 percent

• $1.6 billion in cash from operations; $402 million in free cash flow

• $1.2 billion in productivity gains

New York, Jan. 11, 2016 - Lightweight metals leader Alcoa (NYSE:AA) today reported full- year 2015 results, ending the year on solid operational footing. In fourth quarter 2015, the Value-Add businesses reported strong performance, while the Upstream remained profitable despite lower alumina and aluminum prices. Every segment delivered productivity gains. The Company also undertook restructuring to further strengthen the Upstream portfolio and streamline overhead ahead of its planned separation in the second half of 2016.

In fourth quarter 2015, Alcoa reported a net loss of $500 million, or $0.39 per share. Results include $565 million in special items related primarily to closures or curtailments of capacity in the Upstream business and discrete income tax charges. Fourth quarter 2015 results compare to net income of $159 million, or $0.11 per share, in fourth quarter 2014.

Excluding special items, fourth quarter 2015 net income was $65 million, or $0.04 per share, compared to net income of $432 million, or $0.33 per share, in the year-ago period. Strong productivity gains were more than offset by lower alumina and aluminum prices. In 2015, the Midwest transaction price for primary aluminum fell $657 per metric ton, or 28 percent, and the Alumina Price Index dropped $154 per metric ton, or 43 percent.

Fourth quarter 2015 revenue was $5.2 billion, down 18 percent from $6.4 billion in fourth quarter 2014. Organic growth in aerospace and acquisitions increased revenue 7 percent, which was more than offset by a 25 percent revenue decline from lower alumina and aluminum prices, the impact of divested, curtailed or closed facilities, and unfavorable currency.

"2015 was a pivotal year for Alcoa," said Klaus Kleinfeld, Alcoa Chairman and Chief Executive Officer. "We substantially strengthened our aerospace offerings through innovations and acquisitions and our customers responded favorably, awarding us $9 billion in aerospace contracts; and we continued to ramp up our automotive business and shift the midstream to a higher-margin product mix. In the Upstream, we faced harsh headwinds with prices for alumina down 43 percent and aluminum down 28 percent. As a result of our closures, curtailments, productivity actions and new business structure we improved competitiveness and strengthened the portfolio. We are fully on track to launch two strong, standalone companies in the second half of 2016."

Turning to the current quarter, Kleinfeld continued, "Our solid fourth quarter results reflect our active portfolio management. Aerospace momentum accelerated with record sales and a $4 billion string of major contract wins. In the midstream, adjusted EBITDA per metric ton grew 19 percent as our shift to higher value products like automotive paid off. A new $650 million Value- Add business improvement program will further sharpen our profitability edge. In the Upstream, alumina prices dropped a further 24 percent and aluminum prices stayed stubbornly low. We took aggressive actions: closed and curtailed more unprofitable capacity, accelerated productivity and weathered the storm with Upstream remaining profitable. To further boost resilience we launched a $600 million Upstream business improvement program. We ended the year in an excellent cash position, with all businesses delivering strong productivity."

2015 Full-Year Results

In 2015, Alcoa reported a net loss of $121 million, or $0.15 per share, compared to net income of $268 million, or $0.21 per share, in 2014. Excluding the impact of special items, the Company reported net income of $787 million, or $0.56 per share, in 2015, down from $1.1 billion, or $0.92 per share, in 2014. Strong productivity and favorable currency impacts were more than offset by lower metal prices and cost increases. Revenue in 2015 was $22.5 billion, down 6 percent from $23.9 billion in 2014.

In 2015, Alcoa delivered strong performance against its financial targets. The Company achieved $1.2 billion in productivity savings, exceeding a $900 million annual target; managed return-seeking capital of $602 million against a $750 million annual target; controlled sustaining capital expenditures of $605 million against a $725 million annual target; and attained a debt- to-adjusted EBITDA ratio of 2.80, slightly above the target range.