**SECURITIES AND EXCHANGE COMMISSION**

Washington, D.C. 20549

# FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

**For the quarterly period ended March 31, 2005**

Commission file number 1-3677

**ALCAN INC.**

(Exact name of registrant as specified in its charter)

| **CANADA**
Inapplicable
(State or Other Jurisdiction of
(I.R.S. Employer Identification No.)
Incorporation or Organization)
         
   

**1188 Sherbrooke Street West, Montreal, Quebec, Canada H3A 3G2**

(Address of Principal Executive Offices and Postal Code)

   

**(514) 848-8000**

(Registrant's Telephone Number, including Area Code)

   

   

Indicate by check mark whether the registrant (1) has filed all reports  required to be filed by Section 13 or 15(d) of the Securities Exchange Act of  1934 during the preceding 12 months (or for such shorter period that the  registrant was required to file such reports), and (2) has been subject to  such filing requirements for the past 90 days.

   

Yes  **X******      No  ____

Indicate by check mark whether the registrant is an accelerated filer (as  defined in Rule 12b-2 of the Exchange Act).

Yes  **X**      No  ____

At May 9, 2005 the registrant had 370,145,350 shares of common stock (without  nominal or par value) outstanding.

** **

** **
**TABLE OF CONTENTS **

PART I.     FINANCIAL INFORMATION

Item1.      Financial Statements

               NOTES TO THE INTERIM CONSOLIDATED FINANCIALSTATEMENTS

Item 2.     Management's Discussion and Analysis of Financial Condition and Results ofOperations  

Item 3.     Quantitative and Qualitative Disclosures about Market Risk

Item 4.     Controls and Procedures  

PARTII.    OTHER INFORMATION    

Item 1.      Legal Proceedings

Items 2. and 3.

Item 4.     Submission of Matters to a Vote of Security Holders

Item 5.      Other Information

Item 6.     Exhibits

SIGNATURE

EXHIBIT INDEX
   
**PART I. FINANCIAL INFORMATION** 

In this  report, all dollar amounts are stated in U.S. dollars and all quantities in  metric tons, or tonnes, unless indicated otherwise.  A tonne is 1,000  kilograms, or 2,204.6 pounds.  The word "Company" refers to Alcan Inc. and,  where applicable, one or more of its consolidated subsidiaries.

**Item 1.****Financial Statements**

**ALCAN INC.**

   

**INTERIM  CONSOLIDATED STATEMENT OF INCOME**  (unaudited)

** **
** **
       
**Three months      ended March 31**
**2005**
2004
(*in millions      of US$, except per share amounts)*
       
       
**Sales and operating revenues**
**5,172**
6,005
       
** **
       
**Costs and expenses**
** **
       
Cost of sales and operating      expenses, excluding depreciation and 
** **
                          
amortization noted below
**4,084**
          4,958
Depreciation and amortization
**272**
              336
Selling, administrative and      general expenses
**379**
              395
Research and development      expenses
**49**
                61
Interest 
**85**
                93
Other expenses (income) - net      (note 11)
**25**
                  (2)
       
**4,894**
          5,841
Income from continuing      operations before income taxes and other items
**278**
              164
Income taxes (note 9)
**98**
                41
Income from continuing      operations before other items
**180**
              123
Equity income
**29**
                16
Minority interests
**(1)**
                 (6)
**Income from continuing      operations**
**208**
              133
Income (Loss) from discontinued      operations (note 3)
**10**
               (27)
**Net income**
**218**
              106
Dividends on preference shares
**2**
                  2
**Net income attributable to      common shareholders**
**216**
              104
**Earnings (Loss) per share**(note 4)
** **
       
Basic:
** **
       
Income from continuing      operations 
**0.56**
0.36
Income (Loss) from discontinued      operations
**0.02**
(0.07)
**Net income per common share -      basic**
**0.58**
0.29
Diluted:
       
       
Income from continuing      operations
**0.56**
0.35
Income (Loss) from discontinued      operations
**0.02**
(0.07)
**Net income per common share -      diluted**
**0.58**
0.28
**Dividends per common share**
**            0.15**
            0.15
*The  accompanying notes are an integral part of the interim financial statements.*

**TABLE OF CONTENTS**

**ALCAN INC.**

   

**INTERIM  CONSOLIDATED BALANCE SHEET**  (unaudited)

 
       
       
** **
**March 31,  2005**

December 31, 2004

(*in millions      of US$)*
       
       
 
       
       
**ASSETS**
       
       
 
       
       
**Current assets**
** **
   
Cash and time deposits
**205**
184
Trade receivables (net of      allowances of $61 in 2005 and $99 in 2004)
**2,865**
3,232
Other receivables
**1,234**
1,272
Deferred income taxes
**199**
214
Inventories (note 12)
**2,840**
4,029
Current assets held for sale      (note 3)
**403**
817
**Total current assets**
**7,746**
9,748
       
** **
       
Deferred charges and other      assets
**2,497**
2,877
Deferred income taxes
**728**
870
Property, plant and equipment
** **
       
Cost (excluding Construction      work in progress)
**15,826**
21,922
Construction work in progress
**586**
816
Accumulated depreciation
**(5,611)**
(9,445)
       
**10,801**
13,293
Intangible assets (net of      accumulated amortization of $163 in 2005
       
       
   and $172 in 2004)
**1,086**
1,230
Goodwill
**5,116**
5,496
Long-term assets held for sale      (note 3)
**138**
163
**Total assets**
**28,112**
33,677
       
       
       
       
       
       
*The  accompanying notes are an integral part of the interim financial statements. *

**TABLE OF CONTENTS**

**ALCAN INC.**

**INTERIM  CONSOLIDATED BALANCE SHEET**  (cont'd)****(unaudited)****

 
       
       
** **
**March 31, 2005**

December 31, 2004

(*in millions      of US$)*
       
       
 
       
       
**LIABILITIES AND SHAREHOLDERS'      EQUITY**
       
       
       
       
       
**Current liabilities**
       
       
Payables and accrued      liabilities
**4,747**
5,800
Short-term borrowings
**354**
2,486
Debt maturing within one year
**409**
569
Deferred income taxes
**6**
23
Current liabilities of      operations held for sale (note 3)
**570**
714
**Total current liabilities**
**6,086**
9,592
       
** **
       
Debt not maturing within one      year 
**5,971**
6,345
Deferred credits and other      liabilities
**4,401**
4,975
Deferred income taxes
**1,279**
1,543
Long-term liabilities of      operations held for sale (note 3)
**52**
260
Minority interests
**96**
236
       
** **
       
**Shareholders' equity**
** **
       
Redeemable non-retractable      preference shares
**160**
160
Common shareholders' equity
** **
       
Common shares
**6,098**
6,670
Additional paid-in capital
**689**
112
Retained earnings
**3,241**
3,362
Common shares held by a      subsidiary
**(31)**
(35)
Accumulated other      comprehensive income
**70**
457
       
**10,067**
10,566
       
**10,227**
10,726
       
** **
       
Commitments and contingencies      (note 15)
** **
       
       
** **
       
**Total liabilities and      shareholders' equity**
**28,112**
33,677
       
       
       
*The  accompanying notes are an integral part of the interim financial statements.* 

**TABLE OF CONTENTS**

**ALCAN INC.**

   

**INTERIM  CONSOLIDATED STATEMENT OF CASH FLOWS**  (unaudited)

** **
** **
       
**Three months      ended March 31**
**2005**
2004
(*in millions      of US$)*
       
       
 
       
       
**OPERATING ACTIVITIES**
       
       
       
       
       
Net income
**218**
106
Loss (Income) from discontinued      operations
**(10)**
27
Income from continuing      operations
**208**
133
Adjustments to determine cash      from operating activities:
** **
       
Depreciation and amortization
**272**
336
Deferred income taxes
**61**
(28)
Equity income, net of      dividends
**(27)**
(16)
Asset impairment provisions
**8**
5
Gain on sale of      businesses and investments - net
**(1)**
-
Stock option compensation
**5**
2
Change in operating working      capital
** **
       
Change in receivables
**(186)**
(380)
Change in inventories
**5**
53
Change in payables and accrued      liabilities
**(266)**
185
Change in deferred charges,      other assets, 
** **
       
deferred credits and other      liabilities - net
**(76)**
(18)
Other - net
**(23)**
(2)
Cash from (used for) operating      activities in continuing operations
**(20)**
270
       
** **
       
Cash from operating activities      in discontinued operations
**41**
20
       
** **
       
**Cash from operating activities**
**21**
290
       
** **
       
**FINANCING ACTIVITIES**
** **
       
       
** **
       
Proceeds from issuance of new      debt
**386**
541
Debt repayments
**(636)**
(220)
Short-term borrowings - net
**(2,022)**
(228)
Common shares issued
**4**
25
Dividends - Alcan      shareholders (including preference)
**(58)**
(57)
- Minority interests
**-**
(2)
Cash from (used for) financing      activities in continuing operations
**(2,326)**
59
       
** **
       
Cash used for financing      activities in discontinued operations
**(37)**
(3)
       
** **
       
**Cash from (used for) financing      activities**
**(2,363)**
56
 

*The  accompanying notes are an integral part of the interim financial statements.*
 
**TABLE OF CONTENTS**

**ALCAN INC.**

   

**INTERIM  CONSOLIDATED STATEMENT OF CASH FLOWS**  (cont'd)****(unaudited)  

 
       
       
**Three months      ended March 31**
**2005**
2004
(*in millions      of US$)*
       
       
 
       
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