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ALCOA ANNOUNCES THIRD QUARTER EARNINGS

 PITTSBURGH, Oct. 8 /PRNewswire/ -- Alcoa (NYSE: AA) today announced earnings of $28.8 million, or 32 cents per common share, for the third quarter of 1993.
 Third quarter 1992 earnings were $45.3 million, or 52 cents per share.
 Included in earnings for the 1993 third quarter were a $13.5 million reduction in taxes that resulted from a lower estimated effective tax rate for the year; a special charge of $4.0 million ($6.2 million pretax) for employment reductions announced at Alcoa's fabricating plant in Davenport, Iowa; and a credit of $9.1 million related to the change in the U.S. corporate tax rate. This one-time credit relates to Alcoa's net deferred tax assets in the United States under FAS 109.
 The comparable 1992 quarter included unfavorable translation and exchange adjustments of $8.1 million.
 For the first nine months of 1993, earnings were $96.0 million, or $1.08 per share, before charges. This compares with $156.9 million, or $1.81 per share, for the first nine months of 1992 before an extraordinary loss, accounting changes and special charges.
 After charges, income for the 1993 nine-month period was $91.7 million, or $1.03 per share, compared with a loss of $1,059.2 million, or $12.47 per share, in the 1992 period.
 Earnings were down from 1992 year-to-date due to lower aluminum ingot shipments and lower prices, particularly for ingot and beverage can sheet. Alcoa continues to reduce its costs and to reengineer its operational and administrative processes.
 Despite a 25 percent cutback of U.S. primary aluminum production by Alcoa in the 1993 third qa?rter, world aluminum inventories continued to increase during the quarter with metal prices dropping to a new low in real terms. As long as there is imbalance in supply/demand and a large overhang of metal inventories, prices will remain depressed.
 Revenues for the 1993 third quarter were $2.2 billion compared with $2.4 billion for the 1992 third quarter. Aluminum product shipments were 605,000 metric tons (mt) compared with 675,000 mt in the year-ago quarter.
 Year-to-date, revenues were $6.7 billion compared with $7.0 billion for the first nine months of 1992, while shipments were 1,885,000 mt compared with 2,047,000 mt.
 Excluding the charges, return on shareholders' equity for the 1993 period, annualized, was 3.5 percent.
 Alcoa is the world's largest producer of aluminum. The company has more than 160 operating and sales locations in 23 countries.
 Financial and operating data for Alcoa and its subsidiaries follow.
 FINANCIAL REPORT
 Alcoa and subsidiaries
 (in millions except share and ton amounts)
 (UNAUDITED)
 Third quarter
 For the period ended September 30 1993 1992
 Sales and operating revenues $ 2,230.2 $ 2,381.7
 Other income 21.3 13.0
 2,251.5 2,394.7
 Cost of goods sold and operating 1,775.6 1,860.3
 expenses
 Selling, general administrative and 143.8 146.1
 other expenses
 Research and development expenses 30.2 46.8
 Provision for depreciation and depletion 175.0 168.5
 Interest expense 23.0 20.7
 Taxes other than payroll and severance 25.8 25.8
 taxes
 Special items 6.2 0.0
 2,179.6 2,268.2
 Income from operations before 71.9 126.5
 taxes on income
 Provision for taxes on income (1.5) 44.3
 Income from operations 73.4 82.2
 Less: Minority interests' share (44.6) (36.9)
 NET INCOME $ 28.8 $ 45.3
 Earnings per common share $ 0.32 $ 0.52
 Translation and exchange adjustments
 included in net income $ 0.2 $ (8.1)
 Shipments of aluminum products 605,000 675,000
 (metric tons)
 FINANCIAL REPORT
 Alcoa and subsidiaries
 (in millions except share and ton amounts)
 (UNAUDITED)
 Nine months
 For the period ended September 30 1993 1992
 Sales and operating revenues $ 6,745.1 $ 7,039.2
 Other income 62.2 87.8
 6,807.3 7,127.0
 Cost of goods sold and operating 5,310.0 5,459.9
 expenses
 Selling, general administrative and 432.1 429.7
 other expenses
 Research and development expenses 97.6 158.7
 Provision for depreciation and depletion 515.8 503.7
 Interest expense 65.0 82.0
 Taxes other than payroll and severance 80.2 83.1
 taxes
 Special items 42.2 65.9
 6,542.9 6,783.0
 Income from operations before 264.4 344.0
 taxes on income
 Provision for taxes on income 16.9 120.4
 Income from operations 247.5 223.6
 Less: Minority interests' share (155.8) (121.2)
 Income before accounting changes $ 91.7 $ 102.4
 Extraordinary loss on debt prepayments,
 net of $25.8 tax benefit 0.0 (50.2)
 Cumulative effect of accounting changes for:
 Postretirement benefits, net of $667.2 0.0 (1,166.4)
 tax benefit
 Income Taxes 0.0 55.0
 Net Income (Loss) $ 91.7 $(1,059.2)
 Earnings (loss) per common share:
 Before accounting changes $ 1.03 $ 1.18
 Extraordinary loss 0.00 (0.59)
 Accounting changes:
 Postretirement benefits 0.00 (13.71)
 Income taxes 0.00 0.65
 $ 1.03 $ (12.47)
 Shares outstanding 88,335,873 85,667,682
 Average number of shares used to
 compute earnings per common share 87,470,006 85,408,020
 Translation and exchange adjustments
 included in net income $ 3.6 $ (4.5)
 Shipments of aluminum products 1,885,000 2,047,000
 (metric tons)
 Return on average shareholders'
 equity before special and
 extraordinary items 3.5 pct. 4.5 pct.
 -0- 10/8/93
 /NOTE TO EDITORS: Quarterly earnings for 1992 were restated at the end of that year to reflect implementation of new accounting rules./
 /CONTACT: Alfred T. Posti of Alcoa, 412-553-4465/
 (AA)


CO: Alcoa ST: Pennsylvania IN: MNG SU: ERN

CD -- PG008 -- 0264 10/08/93 15:23 EDT
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Publication:PR Newswire
Date:Oct 8, 1993
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