The accompanying notes are an integral part of the consolidated financial s t atements. * Comprised of unrealized translation adjustments of $535, minimum pension l i ability of $(972), unrealized gains on available-for-sale securitiesof$221, and unrecognized gains/(losses) on derivatives of $51, net of tax † Includes stock to be issued under options of $96 in 2004, $130 in 2003, and $ 1 3 0 in 2002 44 December 31 Comprehensive income Preferred stock Co mmon stock Additional capital Retained earnings Treasury stock Accumulated other compre- hensive loss Total shareholders’ equity Balance at end of 2001 $56 $925 $6,114 $7,517 $(2,706) $(1,292) $10,614 Comprehensive loss — 2002: Net income—2002 $ 420 420 420 Other comprehensive income (loss): Change in minimum pension liability, net of $421 tax benefit (851) Unrealized translation adjustments 309 Unrealized losses on available-for-sale securities, net of $13 tax benefit (25) Unrecognized gains on derivatives, net of tax and minority interests of $(106) (X): Net change from periodic revaluations 60 Net amount reclassified to income 45 Net unrecognized gains on derivatives 105 Comprehensive loss $ (42) (462) (462 ) Cash dividends: Preferred @ $3.75 per share (2) ( 2) Common @ $.60 per share (507) (507 ) Treasury shares purchased (1) (224) (225 ) Stock issued: compensation plans (13) 102 89 Balance at end of 2002 55 925 6,101 † 7,428 (2,828) (1,754) 9,927 Comprehensive income — 2003: Net income—2003 $ 938 938 938 Other comprehensive income (loss): Change in minimum pension liability, net of $21 tax benefit (39) Unrealized translation adjustments 818 Unrealized gains on available-for-sale securities, net of $183 tax expense (X) 340 Unrecognized gains/(losses) on derivatives, net of tax and minority interests of $(53) (X): Net change from periodic revaluations 115 Net amount reclassified to income (49) Net unrecognized gains on derivatives 66 Comprehensive income $2,123 1,185 1,185 Cash dividends: Preferred @ $3.75 per share (2) ( 2) Common @ $.60 per share (514) (514 ) Stock issued: Alcoa Aluminio minority interest acquisition (F) (193) 603 410 Stock issued: compensation plans (77) 208 131 Balance at end of 2003 55 925 5,831 † 7,850 (2,017) (569) 12,075 Comprehensive income — 2004: Net income — 2004 $1,310 1,310 1,310 Other comprehensive income (loss): Change in minimum pension liability, net of $11 tax benefit (21) Unrealized translation adjustments 535 Unrealized losses on available-for-sale securities, net of $51 tax benefit (X) (94) Unrecognized gains/(losses) on derivatives, net of tax and minority interests of $34 (X): Net change from periodic revaluations 120 Net amount reclassified to income (136) Net unrecognized losses on derivatives (16) Comprehensive income $1,714 404 404 Cash dividends: Preferred @ $3.75 per share (2) ( 2) Common @ $.60 per share (522) (522 ) Stock issued: compensation plans (56) 91 35 Balance at end of 2004 $55 $925 $5,775 † $8,636 $(1,926) $ (165)* $13,300 Statement of Shareholders' Equity (in millions, except per-share amounts) Alcoa and subsidiaries