SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549


                            FORM 10-K


       [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
            OF THE SECURITIES EXCHANGE ACT OF 1934

           For the Fiscal Year Ended December 31, 1999

                             OR

     [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
             OF THE SECURITIES EXCHANGE ACT OF 1934

                Commission File Number 001-01430

                     REYNOLDS METALS COMPANY
                     A Delaware Corporation
          (IRS Employer Identification No. 54-0355135)
6601 West Broad Street, P. O. Box 27003, Richmond, Virginia 23261-7003
                   Telephone:  (804) 281-2000


Securities registered pursuant to Section 12(b) of the Act:

                                         Name of Each Exchange
Title of Each Class                       on Which Registered
-------------------                      -------------------------

Common Stock, no par value               New York Stock Exchange
Preferred Stock Purchase Rights          New York Stock Exchange


Securities registered pursuant to Section 12(g) of the Act:  None

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,
and (2) has been subject to such filing requirements for the past
90 days.    Yes   _X_      No ___

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of the Registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.   [X]

As of February 25, 2000:

(a)  the aggregate market value of the voting stock known by the
     Registrant to be held by nonaffiliates of the Registrant was
     approximately $3.7 billion*.

(b)  the Registrant had 63,676,149 shares of Common Stock
     outstanding and entitled to vote.

               DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's definitive proxy statement for its
2000 Annual Meeting of Stockholders to be filed pursuant to
Regulation 14A - Part III
_______________
*  For this purpose, "nonaffiliates" are deemed to be persons
   other than directors, officers and persons owning
   beneficially more than five percent of the voting stock as
   reported to the Securities and Exchange Commission.

<PAGE> i
                              NOTE

This copy includes only EXHIBIT 21 of those listed on pages 68 - 73.

In accordance with the Securities and Exchange Commission's
requirements, we will furnish copies of the remaining exhibits
listed below upon payment of a fee of 10 cents per page.  Please
remit the proper amount with your request to:

                    Secretary
                    Reynolds Metals Company
                    P.O. Box 27003
                    Richmond, Virginia 23261-7003

Exhibits have the following number of pages:

       EXHIBIT 2       149    EXHIBIT 10.15        4
       EXHIBIT 3.1     100    EXHIBIT 10.16       12
       EXHIBIT 3.2      23    EXHIBIT 10.17       17
       EXHIBIT 4.1     100    EXHIBIT 10.18       16
       EXHIBIT 4.2      23    EXHIBIT 10.19        5
       EXHIBIT 4.3       1    EXHIBIT 10.20       10
       EXHIBIT 4.4     165    EXHIBIT 10.21       10
       EXHIBIT 4.5       6    EXHIBIT 10.22        6
       EXHIBIT 4.6      41    EXHIBIT 10.23        2
       EXHIBIT 4.7       9    EXHIBIT 10.24        2
       EXHIBIT 4.8       2    EXHIBIT 10.25        1
       EXHIBIT 4.9       2    EXHIBIT 10.26        3
       EXHIBIT 4.10     10    EXHIBIT 10.27       21
       EXHIBIT 4.11     14    EXHIBIT 10.28        2
       EXHIBIT 4.12      9    EXHIBIT 10.29       10
       EXHIBIT 4.13     36    EXHIBIT 10.30       10
       EXHIBIT 4.14     17    EXHIBIT 10.31        5
       EXHIBIT 4.15     19    EXHIBIT 10.32       12
       EXHIBIT 4.16     18    EXHIBIT 10.33       26
       EXHIBIT 4.17     89    EXHIBIT 10.34       37
       EXHIBIT 4.18      7    EXHIBIT 10.35       21
       EXHIBIT 4.19     12    EXHIBIT 10.36        2
       EXHIBIT 10.1     21    EXHIBIT 10.37        2
       EXHIBIT 10.2     16    EXHIBIT 21           1
       EXHIBIT 10.3     11    EXHIBIT 23           2
       EXHIBIT 10.4      6    EXHIBIT 24          17
       EXHIBIT 10.5      7    EXHIBIT 27           1
       EXHIBIT 10.6      6    EXHIBIT 99           6
       EXHIBIT 10.7     10
       EXHIBIT 10.8     15
       EXHIBIT 10.9     16
       EXHIBIT 10.10     7
       EXHIBIT 10.11    12
       EXHIBIT 10.12    13
       EXHIBIT 10.13     2
       EXHIBIT 10.14     1



                             i


<PAGE> ii
                        TABLE OF CONTENTS

                             PART I
ITEM                                                             PAGE
----                                                             ----

 1.  BUSINESS....................................................  1
       GENERAL
         Nature of Operations....................................  1
         Merger..................................................  1
         Restructuring...........................................  2
         Financial Information Regarding Global
          Business Units and Operations
          by Geographic Location.................................  2
       GLOBAL BUSINESS UNITS
         Base Materials..........................................  2
         Packaging and Consumer..................................  7
         Construction and Distribution...........................  7
         Transportation..........................................  8
       OTHER OPERATIONS..........................................  8
       COMPETITION...............................................  9
       ENVIRONMENTAL COMPLIANCE..................................  9
       RESEARCH AND DEVELOPMENT.................................. 11
       EMPLOYEES................................................. 11
 2.  PROPERTIES.................................................. 11
 3.  LEGAL PROCEEDINGS........................................... 15
 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS......... 15
 4A. EXECUTIVE OFFICERS OF THE REGISTRANT........................ 16

                             PART II

 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
       STOCKHOLDER MATTERS....................................... 18
 6.  SELECTED FINANCIAL DATA..................................... 20
 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
       CONDITION AND RESULTS OF OPERATIONS....................... 21
 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
       MARKET RISK............................................... 35
 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA................. 36
 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
       ON ACCOUNTING AND FINANCIAL DISCLOSURE.................... 65

                            PART III

10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.......... 65
11.  EXECUTIVE COMPENSATION...................................... 65
12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
       AND MANAGEMENT............................................ 65
13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.............. 65

                             PART IV

14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
       ON FORM 8-K............................................... 66



                                ii

<PAGE> 1
                                   PART I


ITEM 1.  BUSINESS

Reynolds Metals Company (the "Registrant") was incorporated in 1928 under the
laws of the State of Delaware.  In this report, "Reynolds" and "the Company"
mean the Registrant and its consolidated subsidiaries unless otherwise
indicated.


                                   GENERAL

NATURE OF OPERATIONS
--------------------

Reynolds is the world's third-largest aluminum producer and the world's
leading aluminum foil producer.  Reynolds serves customers in growing world
markets including the alumina and primary aluminum, packaging and consumer,
commercial construction, distribution, and automotive markets, with a wide
variety of aluminum, plastic and other products.  At December 31, 1999,
Reynolds employed approximately 18,900 people.  Reynolds has operations or
interests in operations at more than 100 locations in 24 countries.
Reynolds' world headquarters is in Richmond, Virginia.

Reynolds' operations are organized into four market-based, global business
units:  Base Materials; Packaging and Consumer; Construction and
Distribution; and Transportation.  For a description of these units, see the
discussion below under the heading "Global Business Units."  For information
about certain operations that are not considered part of a global business
unit, see the discussion below under the heading "Other Operations."

MERGER
------

On August 18, 1999, Reynolds, Alcoa Inc. (Alcoa) and RLM Acquisition Corp., a
wholly owned subsidiary of Alcoa, entered into an agreement and plan of
merger.  Under the merger agreement, each outstanding share of Reynolds
common stock would be converted into 1.06 shares of Alcoa common stock and
Reynolds would become wholly owned by Alcoa.  On January 10, 2000, Alcoa
announced that its Board of Directors had declared a two-for-one split of
Alcoa's common stock to Alcoa shareholders of record on May 26, 2000.  The
stock split is subject to approval of Alcoa shareholders who must approve an
amendment to Alcoa's articles to increase the authorized shares of common
stock at Alcoa's annual meeting on May 12, 2000.  If approved, the stock
split would be distributed on June 9, 2000.  Shares of Alcoa stock that are
issued in the merger will be adjusted, as necessary, to reflect the stock
split.

The proposed merger, which was approved by Reynolds' stockholders at a
special meeting held on February 11, 2000, is subject to customary closing
conditions, including antitrust clearances.

The Hart-Scott-Rodino Antitrust Improvements Act of 1976 prohibits Alcoa and
Reynolds from completing the merger until certain information has been
furnished to the Antitrust Division of the Department of Justice and the
Federal Trade Commission, and until certain waiting period requirements have
been satisfied.  Alcoa filed a Hart-Scott-Rodino Premerger Notification and
Report Form on August 24, 1999 and Reynolds filed such a Form on August 30,
1999.  On September 29, 1999, the Antitrust Division issued a request for
additional information and documentary material (a "second request").  On
February 11, 2000, both Reynolds and Alcoa announced that they believed that
they were in substantial compliance with the second request.  They also
advised the Department of Justice that they would not close the merger before
March 31, 2000, in order to provide the Department sufficient time to review
the transaction.

In Europe, certain regulations require that Alcoa file a premerger
notification form with the Commission of the European Communities prior to
consummation of the proposed merger.  Alcoa filed such notification on
November 18, 1999.  This filing began an initial one-month review period in
which the European Commission was required to determine whether there are
sufficiently "serious doubts" about the proposed merger's compatibility with
the common market to require a more complete review.  The initial one-month
period expired on December 20, 1999,


                                   1

<PAGE> 2
whereupon the European Commission issued a determination that the proposed
merger did require a more complete review.  The European Commission must
complete its investigation and make a final determination with respect to the
proposed merger no later than May 10, 2000.

Reynolds and Alcoa have also made filings under the competition laws of
Canada, Australia and certain other countries where the companies have
significant operations.  Alcoa and Reynolds have been advised that the
Canadian Competition Bureau has classified this merger as "very complex."
Its review is expected to be completed no later than May 24, 2000.
The Australian review process is also expected to be completed by the
end of May 2000.

The merger agreement contains certain restrictions on the conduct of
Reynolds' business before completion of the merger.  For example, Reynolds
has agreed to operate its business only in the ordinary course, to refrain
from taking certain corporate actions without the consent of Alcoa, and not
to solicit alternative acquisition proposals.

Reference is made to the copy of the merger agreement incorporated by
reference herein as Exhibit 2.

RESTRUCTURING
-------------

In early 1999, Reynolds finalized the sale of its Alloys can stock complex,
which included a rolling mill, two reclamation plants and a coil coating
facility, located in Alabama to Wise Alloys LLC, an affiliate of Wise Metals
Co., Inc.  Also in early 1999, Reynolds sold its aluminum extrusion plant in
Irurzun, Spain, as well as its distribution operations for architectural
systems located in Spain, to an affiliate of Alcoa.  Reynolds sold its
investment in a Canadian rolling mill and related assets to Hocan Inc., an
affiliate of CORUS Group PLC, in early January 2000.  Finalization of these
transactions marks the substantial completion of Reynolds' portfolio review
process.

FINANCIAL INFORMATION REGARDING GLOBAL BUSINESS UNITS AND OPERATIONS BY
GEOGRAPHIC LOCATION
-----------------------------------------------------------------------

Financial information for operations and assets attributable to Reynolds'
global business units and information regarding its operations by geographic
location are included in Note 12 to the consolidated financial statements in
Item 8 of this report.



                            GLOBAL BUSINESS UNITS

BASE MATERIALS
--------------

Reynolds' base materials global business unit produces metallurgical alumina,
alumina chemicals and primary aluminum.  It also produces carbon products,
principally for use in primary aluminum reduction plants.

Aluminum is one of the most plentiful metals in the earth's crust.  It is
found chemically combined with other elements.  Aluminum silicates are in
almost every handful of clay, but aluminum is produced primarily from
bauxite, an ore containing aluminum in the form of aluminum oxide, commonly
referred to as alumina.

Aluminum is made by extracting alumina from bauxite and then removing oxygen
from the alumina through an electrolytic process known as "reduction."  The
result is molten primary aluminum, which is cast into various forms for
shipment to fabricating plants.  It takes about four tons of bauxite to make
two tons of alumina, which in turn yield about a ton of primary aluminum.

Reynolds refines bauxite into alumina at its Sherwin alumina plant near
Corpus Christi, Texas.  Reynolds also is entitled to a share of the
production from two joint ventures in which it has interests, one located in
Western Australia, known as the Worsley Joint Venture ("Worsley"), and the
other located in Stade, Germany, known as Aluminium Oxid Stade ("Stade").
See Table 1 under this Item.  In addition, Reynolds has a contract with a
third party to purchase 120,000 metric tons of alumina in 2000.


                                  2

<PAGE> 3
Worsley currently has the capacity to produce 1.88 million metric tons of
alumina per year.  Reynolds is entitled to 56% of the alumina produced by the
joint venture.  The Worsley refinery is currently being expanded to increase
its annual capacity to 3.1 million metric tons.  In addition to increasing
capacity, the expansion project will further reduce operating costs and
improve product quality.  Construction is scheduled to be completed in the
second quarter of 2000.  Worsley has proven bauxite reserves sufficient to
operate the plant at capacity for at least the next 35 years, even after
taking into account the ongoing expansion of the refinery's annual capacity.

Bauxite requirements for Reynolds' Sherwin alumina plant and Reynolds' share
of the Stade joint venture are obtained from the following sources:

     AUSTRALIA

     Reynolds has a long-term purchase arrangement under which it may buy
     from a third party an aggregate of approximately 18,800,000 dry metric
     tons of Australian bauxite through 2021.

     BRAZIL

     Reynolds owns a 5% interest in Mineracao Rio Do Norte S.A. ("MRN"),
     which owns the Trombetas bauxite mining project in Brazil.  Reynolds has
     agreed to purchase approximately 7,000,000 dry metric tons of Brazilian
     bauxite from the project for the period 2000 through 2019.

     Reynolds also maintains an interest in other, undeveloped bauxite
     deposits in Brazil.

     GUINEA

     Reynolds owns a 6% interest in Halco (Mining), Inc.  Halco owns 51% and
     the Guinean government owns 49% of Compagnie des Bauxites de Guinee
     ("CBG"), which has the exclusive right through 2038 to develop and mine
     bauxite in a 10,000 square-mile area in northwestern Guinea.  Reynolds
     has a bauxite purchase contract with CBG that will provide Reynolds with
     a minimum of approximately 6,050,000 dry metric tons of Guinean bauxite
     for the period 2000 through 2011.

     GUYANA

     Reynolds is a 50% partner with the Guyanese government in a bauxite
     mining project in the Berbice region of Guyana.  Reynolds will buy
     approximately 2,000,000 dry metric tons of bauxite from the project in
     2000.

     JAMAICA

     Reynolds has a purchase arrangement under which it will buy from a third
     party an aggregate of up to 3,600,000 dry metric tons of Jamaican
     bauxite for the period 2000 through 2001.

     OTHER

     Reynolds has an arrangement with the U.S. government under which it will
     buy at a negotiated price during 2000 approximately 600,000 long dry
     tons of Jamaican bauxite stored next to the Sherwin alumina plant.

Reynolds' present sources of bauxite and alumina are more than adequate to
meet the forecasted requirements of its primary aluminum production
operations for the foreseeable future.

Reynolds produces primary aluminum at three plants in the United States and
one at Baie Comeau, Quebec, Canada. Reynolds is also entitled to a share of
the primary aluminum produced at three joint ventures in which it
participates:  one in Quebec known as the Becancour joint venture
("Becancour"); one in Hamburg, Germany, known as Hamburg Aluminium-Werk GmbH
("Hamburg"); and the third in Ghana, known as Volta Aluminium Company Limited
("Ghana").  See Table 2 under this Item.


                                  3

<PAGE> 4
Reynolds' primary aluminum products include unalloyed aluminum ingot; billet,
which is used by extrusion plants; sheet ingot, which is supplied to rolling
facilities; foundry ingot, which is the base material for cast products such
as automotive wheels; and electrical redraw rod, which is used by the
electrical cable industry.  During 1999, 80% of Reynolds' primary aluminum
products were sold externally to third parties; the remainder was purchased
by other Reynolds business units.

Production at Reynolds' primary aluminum plants can vary due to a number of
factors, including changes in worldwide supply and demand.  Reynolds
currently has the annual capacity to produce 1,094,000 metric tons of primary
aluminum, of which 47,000 metric tons are temporarily idled.  During 1998,
Reynolds restarted 162,000 metric tons of previously idled production
capacity.  Reynolds will monitor market conditions and its internal needs
before proceeding with further restarts.

In addition to the primary aluminum plants listed in Table 2, Reynolds has a
10% equity interest in the Aluminum Smelter Company of Nigeria ("ALSCON").
The smelter closed indefinitely in 1999 due to lack of working capital.  The
closing has no material effect on Reynolds' operations or financial position.
Reynolds also has an 8% equity interest in C.V.G. Aluminio del Caroni, S.A.
("ALCASA"), which produces primary aluminum in Venezuela.

Reynolds owns and operates two carbon products manufacturing facilities
located in Lake Charles and Baton Rouge, Louisiana.  These facilities have
the capacity to produce 875,000 metric tons of calcined petroleum coke and
145,000 metric tons of carbon anodes annually.  The anodes are produced
principally for consumption at Reynolds' primary aluminum plant in Baie
Comeau, Quebec.  The calcined petroleum coke is used by Reynolds' wholly
owned primary aluminum plants.  Reynolds also sells calcined petroleum coke
worldwide to the aluminum and titanium dioxide industries.

Reynolds' base materials business also operates a commercial hazardous waste
treatment facility in Gum Springs, Arkansas for the treatment of spent
potliner resulting from Reynolds' and other producers' North American aluminum
reduction operations.  Regulations issued by the U.S. Environmental Protection
Agency (the "EPA") require the treatment of spent potliner to prescribed
standards prior to disposal.  The Gum Springs facility has the capacity to
treat 120,000 short tons of spent potliner annually and is currently operating
at approximately 50% of capacity.  In July 1998, the U. S. Court of Appeals
for the District of Columbia struck down the treatment standards included in
the then current EPA regulations.  The EPA subsequently adopted temporary
standards, which are expected to continue in effect until final standards are
adopted.  Reynolds has submitted permit applications to state and federal
environmental authorities to allow it to operate the Gum Springs facility's
landfill as a hazardous waste landfill.  The applications were submitted as a
result of the EPA's 1997 decision to classify treated spent potliner as a
hazardous waste.

ENERGY
------

Reynolds consumes substantial amounts of energy in the aluminum production
process.  Refining alumina from bauxite requires high temperatures.  The
facilities where Reynolds refines alumina achieve these temperatures by
burning natural gas or coal to produce direct heat or steam.  Natural gas and
coal for these facilities are purchased under long- and short-term contracts.
See Table 1 under this Item.

The electrolytic process for reducing alumina to primary aluminum requires
large amounts of electricity.  Reynolds generally expects to meet the energy
requirements for its primary aluminum production for the foreseeable future
under long-term contracts.  Under these contracts, however, Reynolds may
experience shortages of interruptible power from time to time at its Massena,
New York plant and at the plant in Ghana in which Reynolds holds a joint-
venture interest.  The portion of power supplied to the Massena plant that is
interruptible (approximately 15%) can be offset with power purchased from
other sources at market rates.  Production at Ghana is dependent on
hydroelectric power.  The Ghana plant is currently operating at reduced
capacity due to drought conditions that have existed since 1994.  See Table 2
under this Item.

Bonneville Power Administration ("BPA") supplies electricity to Reynolds'
smelters at Longview, Washington and Troutdale, Oregon.  The current contract
with BPA expires on September 30, 2001.  BPA has proposed reducing the amount
of power supplied to the smelters by one-third and pricing the power on a
formula under which charges would vary with world aluminum prices.  Assuming
"average" world aluminum prices (with the basis for determining what is
"average" yet to be settled), the rate charged to Reynolds for the period
2001-2006 would


                                  4

<PAGE> 5
increase by 13% over what Reynolds currently pays.  Reynolds would also have to
find other sources for the balance of its power needs.  The BPA proposal is
subject to full consideration in a rate case, in which Reynolds can present
arguments to improve the offered rate, and other parties can challenge both
the quantity of power being provided to the Reynolds smelters and the rates at
which it is to be provided.  Reynolds expects to participate actively in the
resolution of this issue and to continue assessing alternate power sources
for the two smelters.


<TABLE>
                                     TABLE 1

                        ALUMINA PLANTS AND ENERGY SUPPLY
<CAPTION>
                            Rated
                        Capacity(a) at                         Principal
                       December 31, 1999     Energy         Energy Contract
Plant                     Metric Tons      Purchased(b)     Expiration Date
-----                     -----------      ------------     ---------------
<S>                       <C>              <C>                  <C>
Corpus Christi, Texas     1,600,000        Natural Gas          (c),(d)
Worsley, Australia        1,053,000(e)     Coal and             2002(d)
                                           Natural Gas
Stade, Germany              375,000(e)     Natural Gas          2008
</TABLE>



<TABLE>
                                     TABLE 2

              PRIMARY ALUMINUM PRODUCTION PLANTS AND ENERGY SUPPLY

<CAPTION>
                          Rated
                      Capacity(a) at                       Principal
                     December 31, 1999      Energy       Energy Contract
Plant                   Metric Tons       Purchased(b)   Expiration Date
-----                   -----------       ------------   ---------------
<S>                     <C>                <C>            <C>
Baie Comeau, Quebec     400,000            Electricity    2011 and 2014
Longview, Washington    204,000(f)         Electricity    2001
Massena, New York       123,000(f)         Electricity    2013(g)
Troutdale, Oregon       121,000(f)         Electricity    2001
Becancour, Quebec       186,000(h)         Electricity    2014
Hamburg, Germany         40,000(h)         Electricity    2005
Ghana                    20,000(h)         Electricity    2017
</TABLE>


                                     5


<PAGE> 6
<TABLE>
                                     TABLE 3

              ALUMINA AND PRIMARY ALUMINUM CAPACITY AND PRODUCTION
                                  (Metric Tons)
<CAPTION>
            Alumina(e),(i)                    Primary Aluminum(h),(j)
       --------------------------          -----------------------------
         Rated                               Rated
Year   Capacity(a)     Production          Capacity(a)     Production(f)
----   -----------     ----------          -----------     -------------
<S>     <C>            <C>                  <C>            <C>
1997    2,944,000      2,724,000            1,094,000        893,200
1998    2,944,000      2,868,000            1,094,000        982,900
1999    3,028,000      2,929,000            1,094,000      1,052,700
</TABLE>


NOTES TO TABLES 1, 2, and 3.

(a)  Ratings are estimates at the end of the period based on designed
capacity and normal operating efficiencies and do not necessarily represent
maximum possible production.

(b)  See "Energy" above.

(c)  The Sherwin plant currently purchases 50% of the natural gas required
to operate the plant on a month-to-month basis.  Beginning in June 2000, it
is anticipated that all gas will be supplied under contracts of one year or
longer.

(d)  Reynolds has a long-term agreement to purchase all of Sherwin's steam
and a portion of its electricity from a third-party cogeneration facility
beginning in June 2000.  Worsley has a similar contract to purchase a
portion of its steam and electricity which began in early 2000.

(e)  Reynolds is entitled to 56% of the production of Worsley and 50% of the
production of Stade.  Capacity and production figures reflect Reynolds'
share.

(f)  Reynolds curtailed 121,000 metric tons of production capacity at its
Troutdale primary aluminum plant in the second half of 1991 and restarted
74,000 metric tons of that capacity in 1998.  Reynolds also curtailed an
aggregate of 88,000 metric tons of primary aluminum production capacity at
its Massena (41,000 metric tons) and Longview (47,000 metric tons) plants
effective in 1993.  All of the idled capacity at Massena and Longview was
restarted during 1998.

(g)  The power contract terminates in 2013, subject to earlier termination
by the supplier in 2003 if its federal license for its hydroelectric project
is not renewed.


(h)  Reynolds is entitled to 50% of the production of Becancour, 33-1/3% of
the production of Hamburg, and 10% of the production of Ghana.  Capacity and
production figures reflect Reynolds' share.  Production at Ghana has been
curtailed since September 1994 by drought.  At December 31, 1998, Ghana was
operating at 20% of capacity. Ghana began restarting a portion of its
curtailed capacity in 1999.  The plant is currently operating at
approximately 80% of capacity.

(i)  Production is from the alumina production operations listed in Table 1.

(j)  Production is from the primary aluminum production operations listed in
Table 2.

                                    6

<PAGE> 7
PACKAGING AND CONSUMER
----------------------

Reynolds' packaging and consumer global business unit provides a variety of
foil, plastic and other products and related services to the packaging and
consumer products markets.  Reynolds is the world's leading aluminum foil
producer and a major converter of plastic resins.

Reynolds markets a diverse range of flexible packaging products including
inner and outer wraps, pouches, specialty cartons, child-resistant blister
backing, and plastic containers.  Reynolds' customers include global
marketers of food, confection, healthcare and tobacco products.  Reynolds
also serves the foodservice market (restaurants, delis, supermarket take-
out, and fast-food and catering establishments) with over 1,000 foil,
plastic and paper products including aluminum and plastic film, plastic
containers and lids, foodservice bags, catering trays, sandwich bags and
wraps, baking cups and trays.  Reynolds also produces industrial plastic
film (including Reynolon shrink film) and labels for shrink wrapping and
tamper-evident packaging.

Reynolds manufactures its packaging products at wholly owned facilities in
the U.S., Brazil, Canada and Spain.  See Table 4 under the heading
"Packaging and Consumer."  Reynolds also has an interest in foil operations
in Colombia and Venezuela.  The capacity of these manufacturing facilities
depends on the variety and types of products manufactured.

Reynolds' packaging and consumer global business unit also manufactures and
markets an extensive line of foil, plastic and paper consumer products under
the Reynolds brand name.  Products include the well-known Reynolds Wrap
Aluminum Foil, Reynolds Plastic Wrap, Reynolds Oven Bags, Reynolds Freezer
Paper, Reynolds Cut-Rite Wax Paper, Reynolds Baker's Choice Bake Cups,
Reynolds Hot Bags Foil Bags and Reynolds Wrappers Foil Sandwich Sheets.
Reynolds' consumer products are distributed throughout the U.S., which is
Reynolds' largest market for these products, and in more than 65 other
countries.

In April 1999, Reynolds launched a foodservice packaging and consumer
products subsidiary, Reyco Ltda., in Sao Paulo, Brazil.  Reyco produces
foodservice packaging and consumer products under the Reynolds brand name.

Through its Presto Products Company subsidiary, Reynolds is a supplier of
private label consumer products.  Presto produces a variety of plastic food
wraps and bags (including trash bags and reclosable snack, sandwich, storage
and freezer bags) that are sold under private labels.

Reynolds' subsidiary, Southern Graphic Systems, Inc., produces rotogravure
printing cylinders, color separations and flexographic plates used in
Reynolds' packaging printing operations and for the consumer and industrial
packaging industry.  Southern Graphic's major customers, in addition to
Reynolds, are other consumer products companies and converters, with a trend
toward consumer products companies.  Southern Graphic also provides graphics
management services and manufactures printing accessories (bases and anilox
rolls).

In February 1999, Southern Graphic acquired London Graphics Inc., a Toronto,
Ontario producer of flexographic separations and plates for the packaging
industry in Canada.  It has been integrated with Southern Graphic's Canadian
operations.  Southern Graphic also acquired the assets and/or businesses of
four U.S. producers of flexographic separations and plates for the packaging
industry in 1999.  In addition, Southern Graphic, through its Mexican
subsidiary, Southern Graphic Systems Mexico S. de R.L. de C. V., began
providing onsite services to its customers at its new Mexico City, Mexico
offices in late 1999.

CONSTRUCTION AND DISTRIBUTION
-----------------------------

Reynolds' construction and distribution global business unit distributes
aluminum, stainless steel and other specialty metal products under the names
Reynolds Aluminum Supply Company ("RASCO") and RASCO Specialty Metals Inc.
(in Canada).  This business unit also produces and sells architectural
products and systems.

RASCO provides supply chain management services to North American metal
fabricating customers requiring high-quality aluminum, stainless steel and
other specialty metal products.  During 1999, RASCO's sales (not including
RASCO Specialty Metals Inc.) were 58% in aluminum products and 39% in
stainless steel products.  RASCO processes and distributes plate, sheet,
extrusions, rod and bar products through 37 facilities across North


                                  7

<PAGE> 8
America.  RASCO provides metal processing services such as cutting to length,
slitting, shearing, sawing and plasma burning.  The metal processing services
offered by RASCO allow it to provide customized products, delivered
just-in-time to customers.  RASCO's customers include fabricators and
manufacturers in transportation, equipment, machinery and other markets.

In 1999, RASCO acquired two metal distribution centers in the U.S. and five
in Canada, and opened three new metal distribution centers in the U.S. and
one in Mexico.

Through its construction operations Reynolds produces Reynobond aluminum
composite material that is sold worldwide for architectural and specialty
applications.  In 1999, Reynolds increased its capability to serve European
and global demand for composite material with the substantial completion of
an expansion of its plant in Merxheim, France.

Reynolds' construction and distribution business unit also produces Reynolux
painted aluminum sheet and profiled products; designs and markets
architectural systems consisting of curtainwall, window and door units for
residential and commercial applications; and produces and sells polymer-
coated magnet wire for electrical transformers.

TRANSPORTATION
--------------

Reynolds' transportation global business unit operates nine plants supplying
a wide range of fabricated aluminum products to the transportation industry
and has interests in two additional plants located in Canada and Venezuela.
See Table 4 below under the heading "Transportation."  Reynolds' principal
products are wheels, heat exchanger tubing and automotive structures.
Reynolds markets these products primarily in North America to the "Big
Three" automobile manufacturers, with customers also in Europe and
Venezuela.

Reynolds produces forged and cast aluminum wheels in a variety of sizes,
styles and finishes.  In February 1999, Reynolds completed the start-up of a
$32 million expansion of its forged aluminum wheel manufacturing facility in
Lebanon, Virginia.  The expansion doubled the plant's production capacity to
1.4 million wheels per year.

Heat exchanger tubing products include extruded and drawn round tube, micro
multivoid tube and oval tube made of aluminum and long-life alloys.  These
products are used in applications such as automotive air conditioning
systems and radiators.

Automotive structures include bumpers, car and truck door frames,
convertible roof brackets, sunroof frames, antilock brake system housings,
steering shafts and steering column brackets, among other items, for use in
automobiles and truck and trailer systems.  In mid-1999, Reynolds completed
an equipment expansion at its Indiana extrusion facility to begin production
of the industry's first high volume aluminum engine cradle.


                              OTHER OPERATIONS

Reynolds has certain operations that are not within a global business unit.
These include, principally, its headquarters operations, as well as the
following:

     BOHAI ALUMINIUM INDUSTRIES, LTD. - Reynolds owns a 32.48% interest in this
     aluminum foil and extrusion operation located in China.

     CAN MACHINERY - Reynolds operates a can machinery plant that
     manufactures can production machinery used by aluminum can
     manufacturers around the world.

     EUROPEAN EXTRUSION OPERATIONS - Reynolds' plants in Nachrodt, Germany
     and Harderwijk, Netherlands produce extruded aluminum products that are
     used internally by Reynolds' construction and distribution and
     transportation global business units.  In addition, the plants
     manufacture products that are sold directly to third parties.  The
     portion of these extrusion operations related to products sold directly
     to third parties is not included within Reynolds' global business units.


                                   8

<PAGE> 9
     LATAS DE ALUMINIO. S.A. ("Latasa") - Reynolds owns a 36.6% interest in
     this South American aluminum can operation.

     REAL ESTATE - Reynolds has real estate holdings consisting principally
     of undeveloped land and commercial buildings.

     UNITED ARAB CAN MANUFACTURING COMPANY, LTD. - Reynolds owns a 27.5%
     interest in this aluminum can operation located in Saudi Arabia.


                                 COMPETITION

Competition in Reynolds' industries is based on price, quality and service.
In the sale of its products, Reynolds competes primarily with (i) producers
of alumina and primary aluminum and processors of reclaimed aluminum, (ii)
producers of plastic products, (iii) producers of aluminum and non-aluminum
packaging materials, (iv) metals service center companies engaged in the
distribution of aluminum and other products and (v) fabricators of aluminum
and non-aluminum automotive products.  Reynolds competes with many companies
around the world in the manufacture of primary aluminum products.  In
Europe, Reynolds' principal competitors are seven major multinational
producers of extruded aluminum products and a number of smaller European
producers of aluminum semifabricated products.  Reynolds' consumer products
operations compete primarily with a number of U.S. companies.  North America
is Reynolds' largest market for its flexible packaging products.  Reynolds
has a large number of competitors in this area, ranging from small, local
businesses to large, national companies.  Aluminum and related products
compete with various products, including those made of iron, steel, copper,
zinc, tin, titanium, lead, glass, wood, plastic, magnesium and paper.
Plastic products compete with products made of glass, aluminum, steel,
paper, wood and ceramics, among others.


                          ENVIRONMENTAL COMPLIANCE

Reynolds has spent and will spend substantial capital and operating amounts
relating to ongoing compliance with environmental laws.  The area of
environmental management, including environmental controls, continues to be
in a state of scientific, technological and regulatory evolution.
Consequently, it is not possible for Reynolds to predict accurately the
total expenditures necessary to meet all future environmental requirements.
Reynolds expects, however, to add or modify environmental control facilities
at a number of its worldwide locations to meet existing and certain
anticipated regulatory requirements, including regulations to be implemented
under the Clean Air Act Amendments of 1990 (the "Clean Air Act").

Based on information currently available, Reynolds estimates that compliance
with the Clean Air Act's hazardous air pollutant standards would require in
excess of $200 million of capital expenditures (including a portion of the
expenditures at the Massena plant referred to below), primarily at its U.S.
primary aluminum production plants.  The ultimate effect of the Clean Air
Act on such plants and on Reynolds' other operations (and the actual amount
of any such capital expenditures) will depend on how the Clean Air Act is
interpreted and implemented pursuant to regulations that are currently being
developed and on such additional factors as the evolution of environmental
control technologies and the economic viability of such operations at the
time.  Based on an August 1995 memorandum of understanding with the State of
New York to resolve environmental issues at its Massena, New York primary
aluminum production plant, Reynolds has undertaken a capital spending
program (planned for completion in 2002) of an estimated $175 million to
modernize the Massena plant and significantly reduce air emissions from the
plant.  Pursuant to the memorandum of understanding, Reynolds is
accelerating certain expenditures believed necessary to achieve compliance
with the Clean Air Act's Maximum Achievable Control Technology standards.

Reynolds' capital expenditures for equipment designed for environmental
control purposes were approximately $43 million in 1997, $80 million in 1998
and $48 million in 1999.  The portion of such amounts expended in the United
States was $41 million in 1997, $74 million in 1998 and $41 million in 1999.
Reynolds estimates that annual capital expenditures for environmental
control facilities will be approximately $24 million in 2000, $30 million in
2001 and $21 million in 2002.  The majority of these estimated expenditures
are associated with the capital spending program

                                9

<PAGE> 10
referred to above at the Massena plant.  Future capital expenditures for
environmental control facilities cannot be predicted with accuracy for the
reasons cited above; however, it is reasonable to expect that environmental
control standards will become increasingly stringent and that the expenditures
necessary to comply with them could increase substantially.

Reynolds has been identified as a potentially responsible party ("PRP") and
is involved in remedial investigations and remedial actions under the
Comprehensive Environmental Response, Compensation and Liability Act
("Superfund") and similar state laws regarding the past disposal of wastes
at approximately 40 sites in the United States.  Such statutes may impose
joint and several liability for the costs of such remedial investigations
and actions on the entities that arranged for disposal of the wastes, the
waste transporters that selected the disposal sites, and the owners and
operators of such sites.  Responsible parties (or any one of them) may be
required to bear all of such costs regardless of fault, legality of the
original disposal, or ownership of the disposal site.

In addition, Reynolds is investigating possible environmental contamination,
which may also require remedial action, at certain of its present and former
U. S. manufacturing facilities.  The following discussion provides
information about the current status of two individually significant sites.

     MASSENA, NEW YORK SITE.  In 1988, Reynolds discovered that soils in the
     area of the heat transfer medium system at Reynolds' primary aluminum
     production plant in Massena, New York were contaminated with
     polychlorinated biphenyls ("PCBs") and other contaminants.  Remediation
     of the contaminated soils and other contaminated areas of the plant was
     substantially completed in 1998.  Portions of the St. Lawrence River
     system adjacent to the plant are also contaminated with PCBs.  Since
     1989, Reynolds has been conducting investigations and studies of the
     river system under order from the EPA issued under Superfund.  Reynolds
     is in the process of working with the EPA to better define the scope of
     the dredging program which is planned for 2001.  Reynolds is also aware
     of a natural resource damage claim arising out of the discharge of PCBs
     and other contaminants into the river system that may be asserted by
     potential claimants, including federal, state and tribal natural
     resource trustees.

     TROUTDALE, OREGON SITE.  In 1994, the EPA added Reynolds' Troutdale,
     Oregon primary aluminum production plant to the National Priorities
     List of Superfund sites.  Reynolds is cooperating with the EPA and,
     under a September 1995 consent order, is working with the EPA in
     investigating potential environmental contamination at the Troutdale
     site and promoting more efficient cleanup at the site.


At most of the Superfund sites referred to above where Reynolds has been
identified as a PRP, Reynolds is one of many PRPs, and its share of the
anticipated cleanup costs is expected to be small.  With respect to certain
other sites (not included in the 40 sites discussed above) where Reynolds
has been identified as a PRP, Reynolds has either fully or substantially
settled or resolved actions related to such sites at minimal cost or
believes that it has no responsibility with regard to them.  Reynolds has
been notified that it may be a PRP at certain sites in addition to those
already referred to in this paragraph.

Reynolds' policy is to accrue remediation costs when it is probable that
remedial efforts will be required and the related costs can be reasonably
estimated.  On a quarterly basis, Reynolds evaluates the status of all
sites, develops or revises estimates of costs to satisfy known remediation
requirements and adjusts its accruals accordingly.  At December 31, 1999,
the accrual for known remediation requirements was $162 million.  This
amount reflects management's best estimate of Reynolds' ultimate liability
for such costs.  Potential insurance recoveries are uncertain and therefore
have not been considered.  As a result of factors such as the developing
nature of administrative standards promulgated under Superfund and other
environmental laws; the unavailability of information regarding the
condition of potential sites; the lack of standards and information for use
in the apportionment of remedial responsibilities; the numerous choices and
costs associated with diverse technologies that may be used in remedial
actions at such sites; the availability of insurance coverage; the ability
to recover indemnification or contribution from third parties; and the time
periods over which eventual remediation may occur, estimated costs for
future environmental compliance and remediation are necessarily imprecise.
It is not possible to predict the amount or timing of future costs of
environmental remediation that may subsequently be determined.  Based on
information currently available, it is management's opinion that such future
costs are not likely to have a material adverse effect on Reynolds' competitive
or financial position.  However, such costs could be material to future
quarterly or annual results of operations.



                                  10

<PAGE> 11
See the discussion under "Environmental" in Item 7, and under Note 13 to the
consolidated financial statements in Item 8 of this report regarding
Reynolds' anticipated costs of environmental compliance.


                          RESEARCH AND DEVELOPMENT

Reynolds engages in a continuous program of basic and applied research and
development to support its global business units.  This program deals with
new and improved materials, products, processes and related environmental
compliance technologies.  It includes development and expansion of products
and markets that benefit from aluminum's light weight, strength, resistance
to corrosion, ease of fabrication, high heat and electrical conductivity,
recyclability and other properties.  Materials and core competencies
involving aluminum, ceramics, composites and various polymers and their
processing, fabrication and applications are also included in the scope of
Reynolds' research and development activities.

Expenditures for Reynolds-sponsored research and development activities were
approximately $25 million in 1999, $31 million in 1998, and $41 million in
1997.

Reynolds owns numerous patents relating to its products and processes based
predominantly on its in-house research and development activities.  The
patents owned by Reynolds, or under which it is licensed, generally concern
particular products or manufacturing techniques.  Reynolds' business is not,
however, materially dependent on patents.

                                  EMPLOYEES

At December 31, 1999, Reynolds had approximately 18,900 employees.

In 1996, Reynolds entered into new six-year labor contracts with the United
Steelworkers of America and the Aluminum, Brick and Glass Workers
International Union.  The contracts involve approximately 3,700 active
employees.  At the end of the fifth year, the economic provisions of the
contracts will be reopened.  If agreement cannot be reached, the economic
provisions applicable to the sixth year will be submitted to arbitration.

ITEM 2.  PROPERTIES

Reynolds' products are produced at numerous domestic and foreign plants
wholly or partly owned by Reynolds.  The annual capacity of many of these
plants depends upon the variety and type of products manufactured.  For
information on the location and general nature of certain of Reynolds'
principal domestic and foreign properties, see Item 1 of this report.  Table
4 lists as of February 25, 2000 Reynolds' wholly owned domestic and foreign
operations and shows the domestic and foreign locations of operations in
which Reynolds has interests.  Facilities that are under construction or for
other reasons have not begun production are not listed.  The properties
listed are held in fee except as otherwise indicated.  Properties held other
than in fee are not, individually or in the aggregate, material to Reynolds'
operations and the arrangements under which such properties are held are not
expected to limit their use.  Reynolds believes that its facilities are
suitable and adequate for its operations.  With the exception of the
Troutdale, Ghana and Nigerian primary aluminum production plants and the
Arkansas spent potliner treatment facility, as explained in Item 1, there is
no significant surplus or idle capacity at Reynolds' major manufacturing
facilities.


                                    11

<PAGE> 12
                              TABLE 4
                       WHOLLY OWNED OPERATIONS

                           BASE MATERIALS

     ALUMINA:                            PRIMARY ALUMINUM:
     Corpus Christi, Texas               Massena, New York
     Malakoff, Texas+                    Troutdale, Oregon
                                         Longview, Washington
     CALCINED COKE:                      Baie Comeau, Quebec
     Baton Rouge, Louisiana
     Lake Charles, Louisiana             SPENT POTLINER TREATMENT:
                                         Gum Springs, Arkansas
     CARBON ANODES:
     Lake Charles, Louisiana

     ELECTRICAL REDRAW ROD:
     Becancour, Quebec

                         PACKAGING AND CONSUMER

     FOIL FEED STOCK:                    PACKAGING GRAPHICS AND IMAGE CARRIERS:
     Hot Springs, Arkansas               Bridgeport, Connecticut*
                                         Atlanta, Georgia*
     PACKAGING AND CONSUMER PRODUCTS:    LaGrange, Georgia*
     Beacon Falls, Connecticut           Elgin, Illinois*
     Louisville, Kentucky (2)            Clarksville, Indiana*
     Mt. Vernon, Kentucky                Dayton, Kentucky*
     Sparks, Nevada*                     Louisville, Kentucky (2)
     Boyertown, Pennsylvania             Newport, Kentucky*
     Downingtown, Pennsylvania           West Monroe, Louisiana
     Lewiston, Utah                      Battle Creek, Michigan*
     Rutland, Vermont                    St. Louis, Missouri *
     Bellwood, Virginia                  Armonk, New York*
     Grottoes, Virginia                  Fulton, New York
     Richmond, Virginia                  Wilmington, North Carolina*
     South Boston, Virginia              Exton, Pennsylvania*
     Appleton, Wisconsin (2)             Dallas, Texas
     Little Chute, Wisconsin             Richmond, Virginia (2)**
     Weyauwega, Wisconsin                Mexico City, Mexico*
     Sao Paulo, Brazil*                  Brockville, Ontario*
     Rexdale, Ontario*                   Mississauga, Ontario (2)*
     Barcelona, Spain                    Toronto, Ontario*

                     CONSTRUCTION AND DISTRIBUTION

     CONSTRUCTION:                       DISTRIBUTION:
     Eastman, Georgia                    Service Centers (U.S.) (27)**
     Ashland, Virginia                                   (Canada) (5)**
     Merxheim, France                                    (Mexico) (1)*
     Lelystadt, Netherlands              Processing Centers (U.S.) (4)**
     Distribution Centers (Europe) (9)**
                          (China) (1)*
                          (U.S.) (1)*


                                  12

<PAGE> 13
                            TRANSPORTATION

     HEAT EXCHANGERS:                    WHEELS:
     Louisville, Kentucky                Lebanon, Virginia
     Wexford, Ireland                    Beloit, Wisconsin
                                         Ferrara, Italy
     STRUCTURES:
     Auburn, Indiana
     Maracay, Venezuela
     Nachrodt, Germany***
     Harderwijk, Netherlands***

                                OTHER

     CAN MACHINERY AND SYSTEMS:          RESEARCH AND DEVELOPMENT:
     Richmond, Virginia                  Muscle Shoals, Alabama
                                         Bauxite, Arkansas
                                         Corpus Christi, Texas
                                         Richmond, Virginia (2)






                                  13

<PAGE> 14
                            OTHER OPERATIONS
                    IN WHICH REYNOLDS HAS INTERESTS

Argentina:                                     Ghana:
Aluminum cans                                  Primary aluminum

Australia:                                     Guinea:
Bauxite, alumina                               Bauxite, alumina

Brazil:                                        Guyana:
Aluminum cans and ends, bauxite                Bauxite

Canada:                                        Italy:
Primary aluminum, electric power               Reclamation
generation, aluminum wheels
                                               Nigeria:
Chile:                                         Primary aluminum
Aluminum cans
                                               Saudi Arabia:
China:                                         Aluminum cans
Foil, extrusions
                                               Venezuela:
Colombia:                                      Primary aluminum, mill products,
Mill products, extrusions, foil                foil, aluminum wheels

Egypt:
Extrusions

Germany:
Alumina, primary aluminum


____________________________
*    Leased.
**   Richmond, Virginia Packaging Graphics and Image Carriers - 1 leased.
     European Distribution Centers - 5 leased.
     U.S. Service Centers - 17 leased.
     Canadian Service Centers - 3 leased.
     U.S. Processing Centers - 2 leased.
***  These plants also produce extruded products for Reynolds' construction and
     distribution business unit.  The plant in Harderwijk, Netherlands also
     manufactures heat exchangers and other extruded products.
+    This plant manufactures chemical grade alumina and does not manufacture
     alumina for use in the aluminum production process.

The titles to Reynolds' various properties were not examined specifically for
this report.


                                   14

<PAGE> 15
ITEM 3.  LEGAL PROCEEDINGS

On August 11, 1999, eight class action complaints on behalf of stockholders
of Reynolds were filed in the Delaware Court of Chancery against Reynolds
and certain present and former members of its board of directors.  These
actions are styled Tozour Energy Systems Retirement Plan v. Sheehan, et al.;
Lisa v. Reynolds Metals Company, et al.; Yassin v. Reynolds Metals Company,
et al.; Weinfeld v. Sheehan, et al.; Bader & Yakaitis Profit Sharing Plan
and Trust v. Sheehan, et al.; Rand v. Sheehan, et al.; Grill v. Sheehan, et
al.; and Randolph Capital Management, Inc. v. Sheehan, et al.  The
complaints were filed after Alcoa announced its proposal to acquire
Reynolds.  The plaintiff in each action alleged, among other things, that
the directors of Reynolds failed to negotiate with Alcoa before Alcoa's
announcement; that they were breaching their fiduciary duties by failing to
explore offers for the purchase of Reynolds or to engage in meaningful
discussions with interested parties such as Alcoa; that they were attempting
to entrench themselves in their positions at Reynolds through misuse of
Reynolds' shareholder rights plan; and that they were attempting to deprive
the plaintiffs of the true value of their investment in Reynolds.  The
plaintiff in each action sought injunctive relief requiring the directors of
Reynolds to give due consideration to any proposed business combination, to
resolve any conflicts in favor of Reynolds' public stockholders, and to
refrain from consummating any business combination without conducting an
auction or other process to obtain the highest possible price for Reynolds.
The complaints also sought unspecified damages and awards of fees and costs.
On February 11, 2000, Reynolds' stockholders approved the merger agreement
between Reynolds and Alcoa.  Counsel for the plaintiffs in the Lisa, Yassin,
Weinfeld, Bader & Yakaitis Profit Sharing Plan and Trust, Rand and Grill
actions recently informed the Delaware Court of Chancery that the plaintiffs
in those actions intend to file promptly with the Court a notice dismissing
such actions without prejudice.

Various other suits, claims and actions are pending against Reynolds.  In the
opinion of Reynolds' management, after consultation with legal counsel,
disposition of these proceedings, either individually or in the aggregate,
will not have a material adverse effect on Reynolds' competitive or financial
position.  No assurance can be given, however, that the disposition of one or
more of such suits, claims or actions in a particular reporting period will
not be material in relation to the reported results for such period.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of the Registrant's security holders
during the fourth quarter of 1999.

A special meeting of Reynolds stockholders was held on February 11, 2000.
The stockholders approved and adopted the Agreement and Plan of Merger, dated
as of August 18, 1999, among Alcoa Inc., RLM Acquisition Corp. and Reynolds
Metals Company, and approved the transactions contemplated thereby.  At
December 29, 1999, the record date for the special meeting, 63,463,257
shares of common stock were outstanding and entitled to vote.  The number
of votes cast for and against, and the number of abstentions, as applicable,
were as set forth below.  No other matter was voted upon at the meeting.

          Number of Votes Cast "For"              41,335,471
          Number of Votes Cast "Against"             457,861
          Number of Abstentions                    5,609,245

                                 15


<PAGE> 16
ITEM 4A.  EXECUTIVE OFFICERS OF THE REGISTRANT

The executive officers of the Registrant are as follows:


Name                       Age*    Positions Held During Past Five Years
----                       ----    -------------------------------------

Jeremiah J. Sheehan        61      Chairman of the Board and Chief Executive
                                   Officer since October 1996.  President and
                                   Chief Operating Officer 1994-1996.  Director
                                   since 1994.

Randolph N. Reynolds**     58      Vice Chairman and Executive Officer since
                                   October 1996.  Vice Chairman 1994-1996.
                                   Director since 1984.

William E. Leahey, Jr.     50      Executive Vice President and Chief
                                   Financial Officer since July 1998.  Senior
                                   Vice President, Global Can, April 1997-1998.
                                   Vice President, Can Division 1993-1997.

Thomas P. Christino        60      Senior Vice President, Global Packaging and
                                   Consumer Products, since April 1997.  Vice
                                   President, Flexible Packaging Division
                                   1993-1997.

Donald T. Cowles           53      Senior Vice President, Global Construction
                                   and Distribution, since April 1997.  Vice
                                   President and Reynolds Aluminum Supply
                                   Company Division General Manager August
                                   1995-1997.  Executive Vice President,
                                   Human Resources and External Affairs
                                   1993-1995.

Eugene M. Desvernine       58      Senior Vice President, Diversified
                                   Investments, since July 1999.  Senior Vice
                                   President, Global Transportation, April 1997
                                   - 1999.  Vice President 1994-1997.

Allen M. Earehart          57      Senior Vice President and Controller since
                                   July 1998.  Vice President, Controller
                                   1994-1998.

D. Michael Jones           46      Senior Vice President and General Counsel
                                   since October 1996.  Vice President, General
                                   Counsel and Secretary 1993-1996.

John M. Lowrie             59      Senior Vice President and Executive
                                   Director - Enterprise Systems since January
                                   1999.  Vice President, Consumer Products
                                   1988-1999.

Paul Ratki                 60      Senior Vice President, Global Metals and
                                   Carbon Products, since April 1997.  Vice
                                   President, Metals Division 1994-1997.

C. Stephen Thomas          60      Senior Vice President, Global Technology
                                   and Operational Services, since May 1997.
                                   Vice President, Mill Products Division
                                   1992-1997.

Donna C. Dabney            52      Secretary and Assistant General Counsel
                                   since October 1996.  Associate General
                                   Counsel 1993-1996.

Douglas M. Jerrold         49      Vice President, Tax Affairs, since April
                                   1990.


Ruth J. Mack               45      Vice President, Consumer Products, since
                                   April 1999.  Executive Vice President, Sales
                                   and Marketing, Wampler Foods 1997-1999.
                                   Executive Vice President, Marketing and
                                   Sales, Just Born 1994-1997.

Lou Anne J. Nabhan         45      Vice President, Corporate Communications,
                                   since January 1998.  Director, Corporate
                                   Communications 1993-1998.


                                  16

<PAGE> 17
F. Robert Newman           56      Vice President, Human Resources, since
                                   October 1995.  Corporate Director, Human
                                   Resources 1993-1995.

Edmund H. Polonitza        57      Vice President, Development and Strategic
                                   Planning, since January 1998.  Corporate
                                   Director, Development and Strategic Planning
                                   1987-1998.

William G. Reynolds, Jr.** 60      Vice President, Government Relations
                                   and Public Affairs, since October 1980.

John F. Rudin              54      Vice President, Chief Information Officer,
                                   since August 1995.  Vice President since
                                   April 1995.  Reynolds Aluminum Supply
                                   Company Division General Manager 1989-1995.

Julian H. Taylor           56      Vice President, Treasurer, since April
                                   1988.



_______________
*  As of February 25, 2000.
** Randolph N. Reynolds and William G. Reynolds, Jr. are brothers.





                                   17

<PAGE> 18
                                   PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Registrant's Common Stock is listed on the New York Stock Exchange.  At
February 25, 2000, there were 7,161 holders of record of the Registrant's
Common Stock.

The high and low sales prices for shares of the Registrant's Common Stock as
reported on the New York Stock Exchange Composite Transactions Tape and the
dividends declared per share during the periods indicated are set forth
below:

<TABLE>
<CAPTION>
                         High        Low      Dividends
                         ----        ---      ---------
     <S>                <C>          <C>        <C>
     1999

     First Quarter      $57-5/8      $38-3/4    $.35
     Second Quarter      68           48-3/16    .35
     Third Quarter       71           55         .35
     Fourth Quarter      77-3/4       57-1/2     .35

     1998

     First Quarter      $66          $54-3/8    $.35
     Second Quarter      68-1/8       52-1/4     .35
     Third Quarter       56-15/16     46-7/8     .35
     Fourth Quarter      60-15/16     49-5/16    .35
</TABLE>

On February 18, 2000, the Board of Directors declared a dividend of $.35 per
share of Common Stock, payable April 3, 2000 to stockholders of record on
March 3, 2000.


RECENT SALES OF UNREGISTERED SECURITIES
---------------------------------------

Under the Registrant's Stock Plan for Outside Directors (the "Stock Plan"),
each outside Director serving on the Registrant's Board of Directors on or
after January 1, 1997 receives an annual grant of 225 shares of phantom
stock of the Registrant, plus dividend equivalents based on the dividends
that would have been paid on the phantom stock if the outside Director had
actually owned shares of the Registrant's Common Stock.  The annual grant is
made in quarterly installments at the end of each calendar quarter.  This
rate is increased for each outside Director to 425 shares of phantom stock
per year once the restrictions have expired on all 1,000 shares of
restricted stock awarded to such outside Director under the Registrant's
Restricted Stock Plan for Outside Directors.  Payments under the Stock Plan
will be made upon the outside Director's retirement, resignation or death in
shares of Common Stock of the Registrant, with fractional shares paid in
cash.

Information regarding grants of phantom shares under the Stock Plan during
the period January 1 - September 30, 1999 is included in the Registrant's
Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999, June
30, 1999 and September 30, 1999.  On October 1, 1999, 112 phantom shares, in
the aggregate, were granted to the Registrant's nine outside Directors,
based on an average price of $59.437 per share.  These phantom shares
represent dividend equivalents paid on phantom shares previously granted
under the Stock Plan.  On December 31, 1999, 756 phantom shares, in the
aggregate, were granted to the nine outside Directors, based on an average
price of $76.531 per share.  These phantom shares represent a quarterly
installment of each outside Director's annual grant under the Stock Plan.
During 1999, 3,233 phantom shares were granted under the Stock Plan.


                                18

<PAGE> 19
To the extent that these grants constitute sales of equity securities, the
Registrant issued these phantom shares in reliance on the exemption provided
by Section 4(2) of the Securities Act of 1933, as amended, taking into
account the nature of the Stock Plan, the number of outside Directors
participating in the Stock Plan, the sophistication of the outside Directors
and their access to the kind of information that a registration statement
would provide.








                                19

<PAGE> 20
ITEM 6.  SELECTED FINANCIAL DATA
-----------------------------------------------------------------------
<TABLE>
<CAPTION>
Consolidated Income Statement  (millions, except per share amounts)
------------------------------------------------------------------------

                             1999     1998     1997     1996     1995
                          ----------------------------------------------
<S>                        <C>      <C>      <C>      <C>      <C>

Revenues                   $4,796   $5,859   $6,900   $7,016   $7,252

Cost of products sold       3,928    4,774    5,658    5,856    5,739
Selling, general and
 administrative expenses      361      378      406      445      449
Depreciation and
 amortization                 242      252      368      365      344
Interest                       75      114      153      160      172
Merger-related expenses        19        -        -        -        -
Operational restructuring
 effects - net (1)              -      144       75       37        -
                          ----------------------------------------------
                            4,625    5,662    6,660    6,863    6,704
                          ----------------------------------------------
Income before income
 taxes, extraordinary
 loss and cumulative
 effects of accounting
 changes                      171      197      240      153      548
Taxes on income                47       45      104       49      159
                          ----------------------------------------------
Income before
 extraordinary loss and
 cumulative effects of
 accounting changes           124      152      136      104      389
Extraordinary loss              -      (63)       -        -        -
Cumulative effects of
 accounting changes (1)         -      (23)       -      (15)       -
                          ----------------------------------------------
Net income                 $  124   $   66   $  136   $   89   $  389
                          ==============================================

Earnings per share
 Basic:
  Income before
   extraordinary loss
   and cumulative effects
   of accounting changes    $1.95    $2.18    $1.86    $1.06    $5.60
  Extraordinary loss            -    (0.91)       -        -        -
  Cumulative effects of
   accounting changes           -    (0.33)       -    (0.24)       -
                          ----------------------------------------------
  Net income                $1.95    $0.94    $1.86    $0.82    $5.60
                          ==============================================
 Diluted:
  Income before
   extraordinary loss
   and cumulative effects
   of accounting changes    $1.94    $2.18    $1.84    $1.06    $5.25
  Extraordinary loss            -    (0.91)       -        -        -
  Cumulative effects of
   accounting changes           -    (0.33)       -    (0.24)       -
                          ----------------------------------------------
  Net income                $1.94    $0.94    $1.84    $0.82    $5.25
                          ==============================================

  Cash dividends declared
   per common share         $1.40    $1.40    $1.40    $1.40    $1.20
                          ==============================================

Other items:
------------
 Total assets              $5,950   $6,134   $7,226    $7,516  $7,740
                          ==============================================

 Long-term debt            $1,067   $1,035   $1,501    $1,793  $1,853
                          ==============================================


(1)  See Item 8. Financial Statements and Supplementary Data - Note 1 for a
     discussion of the 1998 change in accounting principle and Note 3 for a
     discussion of operational restructuring.
</TABLE>

                                     20


<PAGE> 21
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS


The following information should be read in conjunction with the
consolidated financial statements, related notes and other sections of this
report.  In the tables, dollars are in millions, except per share and per
pound amounts, and shipments are in thousands of metric tons.  A metric ton
is equivalent to 2,205 pounds.

Management's Discussion and Analysis contains forecasts, projections,
estimates, statements of management's plans,  objectives and strategies for
the Company and other forward-looking statements.  Please refer to the "Risk
Factors" section beginning on page 32 where we have summarized factors that
could cause actual results to differ materially from those projected in a
forward-looking statement or affect the extent to which a particular
projection is realized.


PROPOSED MERGER
---------------
On August 18, 1999, Reynolds, Alcoa Inc. (Alcoa) and RLM Acquisition Corp.,
a wholly owned subsidiary of Alcoa, entered into an agreement and plan of
merger.  Under the merger agreement, each outstanding share of Reynolds
common stock would be converted into 1.06 shares of Alcoa common stock and
Reynolds would become wholly owned by Alcoa.  On January 10, 2000, Alcoa
announced that its Board of Directors had declared a two-for-one split of
Alcoa's common stock to Alcoa shareholders of record on May 26, 2000.  The
stock split is subject to approval of Alcoa shareholders who must approve an
amendment to Alcoa's articles to increase the authorized shares of common
stock at Alcoa's annual meeting on May 12, 2000.  If approved, the stock
split would be distributed on June 9, 2000.  Shares of Alcoa stock that are
issued in the merger will be adjusted, as necessary, to reflect the stock
split.

The proposed merger, which was approved by Reynolds' stockholders at a
special meeting held on February 11, 2000, is subject to customary closing
conditions, including antitrust clearances.

The Hart-Scott-Rodino Antitrust Improvements Act of 1976 prohibits Alcoa and
Reynolds from completing the merger until certain information has been
furnished to the Antitrust Division of the Department of Justice and the
Federal Trade Commission, and until certain waiting period requirements have
been satisfied.  Alcoa filed a Hart-Scott-Rodino Premerger Notification and
Report Form on August 24, 1999 and Reynolds filed such a Form on August 30,
1999.  On September 29, 1999, the Antitrust Division issued a request for
additional information and documentary material (a "second request").  On
February 11, 2000, both Reynolds and Alcoa announced that they believed that
they were in substantial compliance with the second request.  They also
advised the Department of Justice that they would not close the merger
before March 31, 2000, in order to provide the Department sufficient time to
review the transaction.

In Europe, certain regulations require that Alcoa file a premerger
notification form with the Commission of the European Communities prior to
consummation of the proposed merger.  Alcoa filed such notification on
November  18, 1999.  This filing began an initial one-month review period in
which the European Commission was required to determine whether there are
sufficiently "serious doubts" about the proposed merger's compatibility with
the common market to require a more complete review.  The initial one-month
period expired on December 20, 1999, whereupon the European Commission
issued a determination that the proposed merger did require a more complete
review.  The European Commission must complete its investigation and make a
final determination with respect to the proposed merger no later than May
10, 2000.

Reynolds and Alcoa have also made filings under the competition laws of
Canada, Australia and certain other countries where the companies have
significant operations.  Alcoa and Reynolds have been advised that the
Canadian Competition Bureau has classified this merger as "very complex."
Its review is expected to be completed no later than May 24, 2000.  The
Australian review process is also expected to be completed by the end of
May 2000.


                                  21

<PAGE> 22
PROPOSED MERGER - continued
---------------
The merger agreement contains certain restrictions on the conduct of
Reynolds' business before completion of the merger.  For example, Reynolds
has agreed to operate its business only in the ordinary course, to refrain
from taking certain corporate actions without the consent of Alcoa, and not
to solicit alternative acquisition proposals.

In 1999, the Company recognized $19 million of merger-related expenses.
Merger-related expenses are principally for investment banking and legal
services and an increase in the expense accrual for a long-term compensation
plan, which varies based principally on appreciation of the Company's stock
price as compared to the S&P Basic Materials Index.  The Company expects
total merger-related expenses to be at least $35 million.



<TABLE>
<CAPTION>
RESULTS OF OPERATIONS
---------------------
                                    1999        1998          1997
                                 ------------------------------------
<S>                                 <C>         <C>           <C>
RESULTS
Income before extraordinary
 loss and cumulative effect
 of accounting change               $124        $152          $136
Extraordinary loss (see Note 4)        -         (63)            -
Cumulative effect of accounting
 change (see Note 1)                   -         (23)            -
                                 ------------------------------------
Net income                          $124        $ 66          $136
                                 ====================================

EARNINGS PER SHARE - BASIC
Income before extraordinary
 loss and cumulative effect
 of accounting change              $1.95       $2.18         $1.86
Extraordinary loss                     -       (0.91)            -
Cumulative effect of
 accounting change                     -       (0.33)            -
                                 ------------------------------------
Net income                         $1.95       $0.94         $1.86
                                 ====================================

AVERAGE REALIZED PRICE PER POUND
 Primary aluminum                  $0.69       $0.72         $0.82
</TABLE>

Income before extraordinary loss and cumulative effect of accounting change
includes after tax charges for:

<TABLE>
<CAPTION>
   <S>                               <C>         <C>           <C>
   Merger-related expenses
    (see Note 2)                     $16         $ -           $ -
   Operational restructuring
    (see Note 3)                       -          90            78
</TABLE>

Our results increased (decreased) compared to the prior year due principally to
the following (all amounts are pre-tax):

<TABLE>
<CAPTION>
                                                            1999       1998
                                                         ---------------------
<S>                                                        <C>        <C>
Lower prices                                               $(121)     $(134)
Loss of income on sold operations                           (124)         -
Non-cash charges resulting from foreign currency
 translation                                                 (35)         -
Lower conversion costs                                        40         21
Lower interest expense                                        39         39
Higher sales volume and lower material costs and expenses     67        100
</TABLE>


                                     22

<PAGE> 23
RESULTS OF OPERATIONS - continued
---------------------
GLOBAL BUSINESS UNITS
The Company is organized into four market-based, global business units.  The
four global business units and their principal products are as follows:

 . Base Materials - alumina, carbon products, primary aluminum ingot and
  billet, and electrical rod
 . Packaging and Consumer - aluminum and plastic packaging; foodservice
  and consumer products; printing products
 . Construction and Distribution - architectural construction products and
  the distribution of a wide variety of aluminum and stainless steel products
 . Transportation - aluminum wheels, heat exchangers and automotive
  structures

<TABLE>
<CAPTION>
BASE MATERIALS
                                 1999           1998          1997
                             ------------------------------------------
  <S>                           <C>            <C>           <C>
  Aluminum shipments:
   Customer                       867            668           513
   Internal                       211            354           684
                             ------------------------------------------
   Total                        1,078          1,022         1,197
                             ==========================================

  Revenues:
   Customer - aluminum         $1,325         $1,055        $  923
            - nonaluminum         368            402           405
   Internal - aluminum            306            572         1,187
                             ------------------------------------------
   Total                       $1,999         $2,029        $2,515
                             ==========================================
  Operating income             $  250         $  290        $  312
                             ==========================================
</TABLE>

The Base Materials global business unit consists principally of the
following:

Aluminum
--------
 . Primary aluminum - Three plants in the U.S., one in Canada and partial
  interests in plants in Canada (50% owned), Germany (33-1/3% owned) and Ghana
  (10% owned).  Our rated annual production capacity including our share of
  partial interests is 1,094,000 metric tons, of which 47,000 metric tons is
  temporarily idled (see below).
 . Electrical rod - One plant in Canada.

Nonaluminum
-----------
 . Alumina - One plant in the U.S. and partial interests in plants in
  Australia (56% owned) and Germany (50% owned).  Our rated annual production
  capacity including our share of partial interests is 3,028,000 metric tons.
  Depending on operating rates of primary aluminum and alumina facilities,
  approximately 70% of alumina production is consumed within the Base
  Materials global business unit.
 . Carbon products - Two U.S. plants that produce calcined petroleum coke
  (one of which also produces carbon anodes) principally for use in primary
  aluminum facilities.  Depending on operating rates of primary aluminum and
  carbon products facilities, approximately 45% of carbon products production
  is consumed within the Base Materials global business unit.

The increase in customer aluminum shipments in 1999 and 1998 reflects strong
demand for our value-added products (foundry, high purity and sheet ingot,
billet and rod), which made up 75% of our primary aluminum shipments in
1999.  Our available supply to meet customer needs has increased because we
no longer need to supply downstream fabricating operations that have been
sold.  Our available supply also increased because of restarting idled
capacity in 1998 (as discussed below).

In addition to reflecting the changes in shipping volume, aluminum revenues
were significantly affected by lower primary aluminum prices in 1999 and
1998.



                                    23


<PAGE> 24
RESULTS OF OPERATIONS - continued
---------------------
GLOBAL BUSINESS UNITS - continued
BASE MATERIALS - continued
Nonaluminum revenues were lower in 1999 because of lower prices and shipping
volume for carbon products.  Alumina shipments were higher in 1998 because
of significant improvements in production efficiencies and capacity
utilization at our U.S. alumina plant.  Nonaluminum revenues were flat in
1998 as lower prices for alumina and carbon products offset the effect of
higher alumina shipments.

The most significant factor affecting operating profit in 1999 and 1998 was
lower prices for primary aluminum.  Also contributing to the decline in 1998
were non-recurring restart costs at our primary aluminum plants, lower
technical services income and lower alumina prices.  We were able to offset
most of the declines with improved capacity utilization, significant cost
reductions, lower costs for certain raw materials, higher customer shipments
and, in 1999, higher alumina prices.

Results in all three years were negatively impacted by temporarily curtailed
capacity at our U.S. primary aluminum plants.  During 1998, we restarted
162,000 metric tons of previously idled capacity.  We plan to monitor our
internal needs and market conditions before finalizing the schedule to
restart the remaining 47,000 metric tons at our Troutdale, Ore., plant.

Bonneville Power Administration ("BPA") supplies electricity to our smelters
at Longview, Washington and Troutdale, Oregon.  The current contract with
BPA expires on September 30, 2001.  BPA has proposed reducing the amount of
power supplied to the smelters by one-third and pricing the power on a
formula under which charges would vary with world aluminum prices.  Assuming
"average" world aluminum prices (with the basis for determining what is
"average" yet to be settled), the rate charged to Reynolds for the period
2001-2006 would increase by 13% over what we currently pay.  We would also
have to find other sources for the balance of our power needs.  The BPA
proposal is subject to full consideration in a rate case, in which we can
present arguments to improve the offered rate, and other parties can
challenge both the quantity of power being provided to the Reynolds smelters
and the rates at which it is to be provided.  We expect to participate
actively in the resolution of this issue and to continue assessing alternate
power sources for the two smelters.

The outlook for this business unit in the first quarter of 2000 is very
good.  Aluminum and alumina prices are rebounding and demand is strong.

<TABLE>
<CAPTION>
PACKAGING AND CONSUMER
                                          1999        1998        1997
                                       -----------------------------------
   <S>                                  <C>         <C>         <C>
   Customer aluminum shipments             152         141         142

   Revenues:
     Customer - aluminum                $  817      $  787      $  797
              - nonaluminum                632         605         602
                                       -----------------------------------
     Total                              $1,449      $1,392      $1,399
                                       ===================================
   Operating income                     $  159      $  156      $  141
                                       ===================================
</TABLE>

The Packaging and Consumer global business unit consists principally of 17
packaging and consumer products plants in the U.S., one each in Canada,
Spain and Brazil, and 23 graphics facilities located in the U.S., Canada and
Mexico that produce graphics, printing cylinders and plates.

Aluminum shipments and revenues increased in 1999 and 1998 because of strong
demand for Reynolds Wrap aluminum foil and the introduction of new products.
The volume effect on revenues in 1999 was partially offset by lower prices.
In 1998, the gains from sales of Reynolds Wrap aluminum foil and new
products were offset by lower sales of packaging products with the
elimination of certain low-margin products.


                                     24

<PAGE> 25
RESULTS OF OPERATIONS - continued
---------------------
GLOBAL BUSINESS UNITS - continued
Packaging and Consumer - continued
The increase in nonaluminum sales in 1999 resulted from higher sales of
foodservice, graphics and plastic consumer products.  The volume increase
was partially offset by lower prices.

Operating income increased in 1999 because of the higher sales volume and
lower costs for conversion and aluminum raw materials.  These benefits
were mostly offset by lower prices and higher costs for other raw
materials.  Operating income increased in 1998 due to higher sales of
consumer products, lower raw material costs and cost reduction programs.
Higher product development and marketing costs for new consumer products
introduced in 1998 partially offset these benefits.

Looking forward, this business unit expects to enjoy sales growth from
acquisitions completed in 1999, the benefits of expansions at plastic and
printing plants, and new product introductions.

<TABLE>
<CAPTION>
CONSTRUCTION AND DISTRIBUTION
                                       1999       1998       1997
                                   ----------------------------------
   <S>                               <C>          <C>        <C>
   Customer aluminum shipments          202        184        166

   Revenues:
     Customer - aluminum             $  679       $681       $614
              - nonaluminum             346        314        328
                                   ----------------------------------
     Total                           $1,025       $995       $942
                                   ==================================
   Operating income                  $   42       $ 39       $ 41
                                   ==================================
</TABLE>

The Construction and Distribution global business unit consists
principally of 48 distribution centers in the U.S., Europe, Canada and
Mexico and four manufacturing plants, two in the U.S. and two in Europe.

The increase in aluminum shipments in 1999 and 1998 resulted from strong
demand for distribution products.  All of our major distribution products
(plate, sheet and extrusions) benefited from market share growth in our
major domestic markets.  Construction products shipments were lower in
1999 after growing in 1998.  Shipments in 1999 were adversely affected by
weak market conditions in Germany, the China/Pacific Rim area and Latin
America.  Shipments were higher in 1998 because of our global expansion
efforts and strong demand for aluminum composite material.

The effect of the shipping volume increase on aluminum revenues in 1999
was totally offset by lower prices.  The decline in prices reflected lower
material costs.  The increase in aluminum revenues in 1998 was the result
of the shipping volume increase while prices remained relatively flat.

Shipments of stainless steel distribution products increased 17% in 1999
(including the effect of acquisitions) and 8% in 1998.  The effect of
these volume increases on nonaluminum revenues was offset by lower prices,
especially in 1998.  Prices for these products, under pressure due to
lower material costs resulting from global supply/demand imbalances, began
to improve in late 1999.

Operating income in 1999 and 1998 benefited from the higher shipping
volumes.  This was somewhat offset by lower capacity utilization in
construction products plants resulting from weak business conditions in
certain foreign markets.  In 1998, we incurred higher marketing costs to
expand construction products' global sales and distribution infrastructure
to enhance customer service.

Customers in our major distribution markets continue to experience a
strong business climate, and our outlook for the first quarter of 2000 is
strong.  For construction products, we expect to see improvement as
economies around the world improve.  With the expansion of our Merxheim,
France plant to produce aluminum composite material, we have improved our
ability to meet European and global demand for Reynobond aluminum
composite material from this plant and our U.S. plant.



                                 25

<PAGE> 26
RESULTS OF OPERATIONS - continued
---------------------
GLOBAL BUSINESS UNITS - continued
TRANSPORTATION
<TABLE>
<CAPTION>
                                         1999      1998      1997
                                     --------------------------------
    <S>                                  <C>       <C>       <C>
    Customer aluminum shipments            73        63        66

    Customer revenues                    $398      $336      $353

    Operating income (loss)               (28)      (19)       10
                                     ================================
</TABLE>

The Transportation global business unit consists principally of the
following:

 . Aluminum wheels - Two plants in the U.S., one in Italy, and partial
  interests in plants in Canada (75% owned) and Venezuela (41% owned).
 . Automotive extrusions - Two plants in the U.S. and one each in The
  Netherlands, Germany, Ireland and Venezuela.

Shipments and revenues were higher in 1999 because of strong demand for
cast and forged aluminum wheels.  Our available supply increased due to
improved capacity utilization and the completion of the expansion of our
Virginia forged aluminum wheel plant in early 1999.  The volume impact on
revenues was partially offset by lower prices.

Shipments and revenues in 1998 were negatively impacted by volume declines
in bumpers and cast aluminum wheels.  The decline in bumper shipments resulted
from the completion of a contract in 1997 at our Indiana automotive
structures plant.  Cast aluminum wheel shipments were lower because of
decreased demand related to a substantial number of mid-year wheel program
conversions and a strike at a customer earlier in the year.  The lower
shipments of cast aluminum wheels in 1998 were somewhat offset by higher
shipments of forged aluminum wheels from our Virginia plant.  Revenues in
1998 also declined due to lower prices for wheels because of competition
for new business.

The increased losses in 1999 and 1998 were due to start-up costs relating
to an engine cradle program at our Indiana automotive structures plant,
higher conversion costs resulting from manufacturing difficulties in wheel
operations and lower selling prices.

Despite significant effort, this business unit was not able to return to
profitability because of two major challenges.  The first was in the
forged wheels business.  We built a new plant in Lebanon, Virginia that
uses a new technology.  We have now constructed two lines at the plant.
In 1999, the capability of the plant fell short of the projections on
which sales commitments had been made.  In order to meet promised
deliveries to customers - and in some instances to keep customer
operations running - we incurred significantly higher costs.  This
situation has been improving, and our wheel business overall realized
important year-over-year improvement in 1999.  We expect the wheel
business to become profitable in 2000.

The second major challenge is in our structures operations.  Together with
General Motors, we have pioneered a new aluminum automotive component -
the engine cradle.  We underestimated the technological and operational
requirements of producing this new product, and we have incurred
significantly higher spending and resource allocation to meet promised
deliveries.  This situation is also improving, and we expect better
results in 2000.

Evaluating opportunities for strategic alliances in this business unit has
been part of our plan for performance improvement.  During 1999, we looked
at a number of options and progressed to serious discussions.  All of this
activity, however, was suspended once our merger with Alcoa was announced.


                                 26

<PAGE> 27
RESULTS OF OPERATIONS - continued
---------------------
GLOBAL BUSINESS UNITS -  continued
RESTRUCTURING
No revenues or operating results are included in the Restructuring
category in 1999.  Prior to 1999, this category consisted of the following
operations that have been sold:

 .    U.S. recycling operations
 .    aluminum extrusion facilities in Canada
 .    European rolling mill operations
 .    Illinois sheet and plate plant
 .    North American aluminum beverage can operations
 .    Alabama can stock complex
 .    U.S. residential construction products business
 .    aluminum reclamation plant in Virginia
 .    aluminum extrusion plants in Virginia and Texas
 .    coal properties in Kentucky
 .    one-half of the Company's wholly owned interest in a rolling mill and
     related assets in Canada
 .    aluminum powder and paste plant in Kentucky

Customer revenues generated by these operations were $1.4 billion in 1998
and $2.7 billion in 1997.  The decline in shipments and net sales in 1998
and 1997 was due to the sale of these operations.  In 1998, the absence of
operating income from sold operations was offset by the effect ($65
million) of ceasing depreciation on assets held for sale.

For additional information concerning the Company's restructuring
activities, see Notes 3 and 12 to the consolidated financial statements.

OTHER
This category consists principally of European extrusion operations and
investments in Canada, China, Latin America and Saudi Arabia, and real
estate.

The increase in shipments and revenues in 1999 resulted from improved
demand at European extrusion operations.

Operating income was higher in 1999 because of improved operations in
emerging markets and higher equity income in our Latin American can
operations.  The increased operating loss in 1998 was due to lower equity
income in our Latin American can operations.

In early 2000, we sold our remaining investment in a Canadian rolling mill
and related assets that was included in this category.  This transaction
will not have a material impact on our operating results or financial
position.

GEOGRAPHIC AREA ANALYSIS
The Company has worldwide operations in the U.S., Canada and other foreign
areas including Europe and Australia.  Certain of these consist of equity
interests in entities, the revenues of which are not included in our
consolidated revenues.  In Australia, we participate in an unincorporated
joint venture that mines bauxite and produces alumina.

Revenues were negatively impacted in 1999 and 1998 due to lower primary
aluminum prices and the Company's restructuring activities in 1998 and
1997.  Revenues in Canada increased in 1999 as primary aluminum previously
sold internally became available for customer shipments because we no
longer need to supply downstream fabricating operations that have been
sold.

INTEREST EXPENSE
Interest expense decreased in 1999 because of:

 .    lower amounts of debt outstanding
 .    lower average interest rates due to extinguishing higher cost debt
 .    higher amounts of capitalized interest

Interest expense decreased in 1998 because of lower amounts of debt
outstanding.

                                27

<PAGE> 28
RESULTS OF OPERATIONS - continued
---------------------
TAXES ON INCOME
The Company pays U.S. federal, state and foreign taxes based on the laws
of the various jurisdictions in which it operates.  The effective tax
rates (see reconciliation in Note 11 to the consolidated financial
statements) reflected in the income statement differ from the U.S. federal
statutory rate principally because of the following:

 .    foreign taxes at different rates
 .    the effects of percentage depletion allowances
 .    additionally in 1999 and 1998, credits and other tax benefits
 .    additionally in 1997, the adverse effect of permanent basis
     differences on asset dispositions

We have worldwide operations in many tax jurisdictions that generate
deferred tax assets and/or liabilities.  Deferred tax assets and
liabilities have been netted by jurisdiction.  This results in both a
deferred tax asset and a deferred tax liability on the balance sheet.

At December 31, 1999, we had $822 million of deferred tax assets that
relate primarily to U.S. tax positions.  The most significant portions of
these assets relate to tax carryforward benefits and accrued costs for
employee health care, environmental and restructuring costs.  We expect to
realize a major portion of these assets in the future through the reversal
of temporary differences, principally depreciation.  To the extent that
these assets are not covered by reversals of depreciation, we expect the
remainder to be realized through U.S. income earned in future periods.

The Company has a strong history of sustainable earnings.  However, even
without considering projections of income, certain tax planning strategies
(such as changing the method of valuing inventories from LIFO to FIFO
and/or entering into sale-leaseback transactions) would generate
sufficient taxable income to realize the portion of the deferred tax asset
relating to U.S. operations.  In addition, the majority of our U.S. tax
carryforward benefits may be carried forward indefinitely.

Based on our evaluation of these matters, we expect to realize these
deferred tax assets. We are not aware of any events or uncertainties that
could significantly affect our conclusions regarding realization.  We
reassess the realization of deferred tax assets quarterly and, if
necessary, adjust the valuation allowance accordingly.


ENVIRONMENTAL
The Company is involved in remedial investigations and actions at various
locations, including Environmental Protection Agency-designated Superfund
sites where we and, in most cases, others have been designated as
potentially responsible parties (PRPs).  We accrue remediation costs when
it becomes probable that such efforts will be required and the costs can
be reasonably estimated.  We evaluate the status of all significant
existing or potential environmental issues quarterly, develop or revise
cost estimates to satisfy known remediation requirements, and adjust the
accrual accordingly.  At December 31, 1999, the accrual was $162 million.
The accrual reflects our best estimate of the ultimate liability for known
remediation costs.

Amounts accrued for two sites - our Massena, New York and Troutdale,
Oregon primary aluminum plants - represent individually material portions
of the accrual at December 31, 1999.  For information about the current
status of these two sites, see the discussion in Item 1 under
"Environmental Compliance."  At most of the other Superfund sites where
the Company has been identified as a PRP, the Company is one of many PRPs,
and our share of the anticipated cleanup costs is expected to be small.

In estimating anticipated costs, we consider the extent of our involvement
at each site, joint and several liability provisions under applicable law,
and the likelihood of obtaining contribution from other PRPs.  Potential
insurance recoveries are uncertain and therefore have not been considered.
Based on information currently available, we expect to make remediation
expenditures relating to costs currently accrued over the next 15 to 20
years with the majority spent by the year 2005.  We expect cash provided by
operating activities to provide the funds for environmental capital,
operating and remediation expenditures.


                                    28


<PAGE> 29
RESULTS OF OPERATIONS - continued
---------------------
ENVIRONMENTAL - continued
Annual capital expenditures for equipment designed for environmental
control purposes averaged approximately $57 million over the past three
years.  Ongoing environmental operating costs for the same period averaged
approximately $81 million per year.  The Company expects operating
expenditures for 2000 through 2002 to be approximately $80 million per
year.  We estimate annual capital expenditures for environmental control
facilities will be approximately $24 million in 2000, $30 million in 2001
and $21 million in 2002.  The majority of these expenditures are for the
capital spending program referred to below at our primary aluminum plant
in Massena, New York.

Our spending on environmental compliance will be influenced by future
environmental regulations, including those issued and to be issued under
the Clean Air Act Amendments of 1990.  We are spending an estimated $175
million at our primary aluminum plant in Massena, New York for new air
emissions controls and a phased modernization of the plant's production
lines.  We expect to complete this project in the year 2002.  We are
accelerating certain expenditures believed necessary to achieve compliance
with the Clean Air Act's proposed Maximum Achievable Control Technology
standards.  Based on current information, we estimate that compliance with
the Clean Air Act's hazardous air pollutant standards will require in
excess of $200 million of capital expenditures (including a portion of the
expenditures at the New York plant previously discussed), principally at
our U.S. primary aluminum plants.

For additional information concerning environmental expenditures, see Note
13 to the consolidated financial statements.


YEAR 2000 READINESS DISCLOSURE
In 1999, we completed a formal program to address and resolve potential
exposure associated with information and non-information technology
systems arising from the Year 2000 issue.   The Year 2000 issue results
from computer programs and systems that rely on two digits rather than
four to define the applicable year.  Such systems may treat a date using
"00" as the year 1900 rather than the year 2000.  As a result, computer
systems could fail to operate or make miscalculations, causing disruption
of business operations.

Our goal was that none of our critical business operations or computer
processes that are shared with suppliers and customers would be
substantially impaired by the advent of the year 2000.  We accomplished
this goal and experienced no business interruptions as a result of Year
2000 problems.  The minor Year 2000 problems encountered (e.g., incorrect
invoice dates) were solved in a timely manner.  We do not anticipate the
need for additional contingency planning.  However, we will continue
monitoring for Year 2000 issues beyond those already addressed and
anticipate that any additional problems will be resolved using resources
normally available to the Company.

The total cost of our Year 2000 remediation project was approximately $22
million, which included labor, equipment and license costs.


EURO CONVERSION
On January 1, 1999, 11 of the 15 member countries of the European Union
established fixed conversion rates between their former sovereign
currencies and a common currency, the euro.  The euro trades on currency
exchanges and is available for non-cash transactions.  Between January 1,
1999 and July 1, 2002, entities in the participating countries must
convert all of their transactions denominated in the legacy currencies to
the new euro currency.  We expect to have our systems ready in time to
process euro denominated transactions.  We do not expect any material
adverse effects from the euro conversion on our competitive or financial
position or our ongoing results of operations.



                                  29


<PAGE> 30
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
WORKING CAPITAL

<TABLE>
<CAPTION>
                                                           December 31
                                                    -------------------------
                                                        1999          1998
                                                    -------------------------
    <S>                                                <C>           <C>
    Working capital                                     $137          $361
    Ratio of current assets to current liabilities     1.1/1         1.3/1
</TABLE>

The decline in working capital was due in part to the sale of $128 million
of accounts receivable under a non-recourse facility.  We are able to
operate with lower levels of working capital as a result of our
restructuring activities.


OPERATING ACTIVITIES
<TABLE>
<CAPTION>
                                                 1999      1998      1997
                                               ----------------------------
    <S>                                          <C>       <C>       <C>
    Net cash provided by operating activities    $406      $339      $363
</TABLE>

We used the net cash provided by operating activities for the past three
years primarily to fund capital investments.


INVESTING ACTIVITIES
The following table shows capital investments in the following categories:
operational (replacement equipment, environmental control projects, etc.)
and strategic (performance improvement, acquisitions and investments).

<TABLE>
<CAPTION>
                                           1999      1998      1997
                                        ------------------------------
        <S>                                <C>       <C>       <C>
        Operational                        $116      $155      $152
        Strategic                           410       186       120
                                        ------------------------------
        Total capital investments          $526      $341      $272
                                        ==============================

Major strategic projects that have been completed or that are under way
include:

 BASE MATERIALS
 In 1997, we began the expansion of the joint-venture Worsley Alumina
 Refinery in Australia in which we hold a 56% interest.  The expansion
 will increase the annual capacity of the facility by 65% to 3.1 million
 metric tons.  Completion is expected in 2000.

 PACKAGING AND CONSUMER
 . expanded a U.S. plastic film plant (completed in 1997)
 . modernizing U.S. foil plants (to be completed in 2000)
 . acquired in 1999 four producers of flexographic separations and
   plates for the packaging industry in the U.S. and one in Canada and a U.S.
   manufacturer of microwaveable containers for the foodservice industry

 CONSTRUCTION AND DISTRIBUTION
 . expanded a plant in Europe that will produce composite architectural
   products (substantially completed in 1999)
 . acquired and opened new metals distribution centers in the U.S. and
   Canada in 1999

 TRANSPORTATION
 . constructed (completed in 1997) and expanded (completed in 1999) a
   forged wheel plant in Virginia
 . expanded and modified a plant in Indiana that produces bumpers,
   engine cradles and other automotive components (completed in 1999)


                                  30


<PAGE> 31
LIQUIDITY AND CAPITAL RESOURCES - continued
-------------------------------
INVESTING ACTIVITIES - continued
OTHER INVESTING ACTIVITIES
In addition to these major projects, capacity expansions, equipment
upgrades, improvement programs and other capital expenditures have been
completed or are currently under way at a number of other facilities.


PROJECTED 2000
Capital investments planned for 2000 (approximately $265 million excluding
acquisitions) are primarily for those strategic projects now under way and
continuing operating requirements.  We expect to fund these capital
investments with cash provided by operating activities.


FINANCING ACTIVITIES
We believe our available financial resources, together with internally
generated funds, are sufficient to meet our present and future business
needs.  We continue to exceed the financial ratio requirements contained
in our financing arrangements and expect to do so in the future.  At
December 31, 1999, $13 million of our shelf registration remained
available for the issuance of debt securities.  We also have committed
credit facilities of $835 million, of which $685 million was available at
December 31, 1999.  A summary of significant financing activities over the
past three years follows:

1997
 . reduced debt by approximately $400 million with the proceeds from
  sales of assets

1998
 . reduced debt by approximately $900 million with part of the proceeds
  from sales of assets (including repayment of $100 million borrowed under
  credit facilities during 1998)
 . repurchased common stock with part of the proceeds from sales of
  assets (see the Consolidated Statement of Changes in Stockholders' Equity)
 . borrowed $415 million under credit facilities
 . terminated a $100-million interest rate swap agreement

1999
 . increased short-term borrowings by $313 million
 . increased available revolving credit facilities by $185 million (see
  Note 8)
 . issued $100 million of medium-term notes (see Note 8)
 . increased the authorization to issue commercial paper from $350
  million to $500 million
 . repurchased common stock with part of the proceeds from sales of
  assets (see the Consolidated Statement of Changes in Stockholders' Equity)

We used the proceeds from the borrowings in 1999 to repay at maturity $100
million of 9 3/8% debentures, to reduce borrowings under our revolving
credit facilities and to make other scheduled debt payments.

In early 2000, we increased the amount of debt securities we can issue
under our shelf registration to $163 million.


                                     31


<PAGE> 32
RISK FACTORS
------------
This section should be read in conjunction with Items 1 and 3 of this
report and with the preceding portions of this Item.

This report contains (and oral communications made by or on behalf of
Reynolds may contain) forecasts, projections, estimates, statements of
management's plans, objectives and strategies for Reynolds and other
forward-looking statements<FN1>.  Reynolds' expectations for the future and
related forward-looking statements are based on a number of assumptions
and forecasts, including:

 .    world economic growth and other economic indicators (including rates
     of inflation, industrial production, housing starts and light vehicle
     sales)
 .    trends in Reynolds' key markets
 .    global aluminum supply and demand conditions
 .    primary aluminum prices

By their nature, forward-looking statements involve risk and uncertainty,
and various factors could cause Reynolds' actual results to differ
materially from those projected in a forward-looking statement or affect
the extent to which a particular projection is realized.

The Company remains optimistic about the demand for aluminum for 2000.
The continuing economic expansion in North America along with strong
recoveries in both Western Europe and Asia (excluding Japan) has resulted
in accelerating consumption growth, especially in the fourth quarter of
1999.  Early estimates suggest that aluminum consumption grew by more than
5% in 1999, exceeding our earlier forecasts.  We expect that consumption
of aluminum will continue to grow at a rate of 4% to 6% per year for 2000
and 2001.

Economic and/or market conditions other than those forecasted by the
Company in the preceding paragraph could cause the Company's actual
results to differ materially from those projected in a forward-looking
statement or affect the extent to which a particular projection is
realized.

The following factors also could affect Reynolds' results:

 . Primary aluminum is an internationally traded commodity.  The price
  of primary aluminum is subject to worldwide market forces of supply and
  demand and other influences.  Prices can be volatile.  Because primary
  aluminum makes up a significant portion of Reynolds' shipments, changes in
  aluminum pricing have a rapid effect on its operating results.  Reynolds'
  use of contractual arrangements, including fixed-price sales contracts,
  fixed-price supply contracts, and forward, futures and option contracts,
  reduces its exposure to price volatility but does not eliminate it.

 . The markets for most aluminum products are highly competitive.
  Certain of Reynolds' competitors are larger than Reynolds in terms of
  total assets and operations and have greater financial resources.  Certain
  foreign governments are involved in the operation and/or ownership of
  certain competitors and may be motivated by political as well as economic
  considerations.  In addition, aluminum competes with other materials, such
  as steel, plastics and glass, among others, for various applications in
  Reynolds' key markets.  Plastic products compete with similar products
  made by Reynolds' competitors, as well as with products made of glass,
  aluminum, steel, paper, wood and ceramics, among others.  Unanticipated
  actions or developments by or affecting Reynolds' competitors and/or the
  willingness of customers to accept substitutions for the products sold by
  Reynolds could affect results.

________________________
<FN>
<FN1>Forward-looking statements can be identified generally as those
containing words such as "should," "will," "will likely result," "hope,"
"forecast," "outlook," "project," "estimate," "expect," "anticipate,"
"scheduled," or "plan" and words of similar effect.
</FN>


                                   32


<PAGE> 33
RISK FACTORS - continued
------------
 . As discussed in Part I, Item 1, Reynolds spends substantial capital
  and operating amounts relating to ongoing compliance with environmental
  laws.  In addition, Reynolds is involved in remedial investigations and
  actions in connection with past disposal of wastes.  The identification of
  additional material remediation sites in the future (that are presently
  unknown) at which Reynolds may be named as a potentially responsible party
  could have a material adverse effect on its results of operations in a
  future interim or annual reporting period.  Moreover, estimating future
  environmental compliance and remediation costs is imprecise due to:

       - continuing evolution of environmental laws and regulatory
          requirements and uncertainties about their application to Reynolds'
          operations
       - availability and application of technology
       - allocation of costs among potentially responsible parties

 . Reynolds has investments and activities in various emerging markets,
  including China, India and Brazil.  While emerging markets offer strong
  growth potential, they also present a higher degree of risk than more
  developed markets.  In addition to the business risks inherent in
  developing and servicing new markets, economic conditions may be more
  volatile, legal systems less developed and predictable, and the
  possibility of various types of adverse government action more pronounced.

 . Unanticipated material legal proceedings or investigations, or the
  disposition of those currently pending against Reynolds other than as
  anticipated by management and counsel, could have a material adverse
  effect on its results of operations for a particular reporting period.

 . Changes in the costs or availability of supply of power, resins,
  caustic soda, green coke and other raw materials can materially affect
  results.  Substantial increases in power costs, particularly in the
  Pacific Northwest, may adversely affect Reynolds' primary aluminum
  production plants which require reliable, low-cost power.

 . Changes in laws and regulations, both U.S. and foreign, or their
  interpretation and application, including changes in tax laws and their
  interpretation and application, could affect Reynolds' results.

 . A number of Reynolds' operations are cyclical and can be influenced
  by economic conditions.

 . A failure to complete major capital projects, such as expansion of
  the Worsley Alumina Refinery (by reason of construction delays or
  disputes, labor unrest or otherwise), as scheduled and within budget or a
  failure to successfully launch new growth or strategic business programs,
  such as the engine cradle program where we are experiencing higher than
  anticipated costs, could affect Reynolds' results.

 . A strike at a customer facility or a significant downturn in the
  business of a key customer supplied by Reynolds could affect its results.

The proposed merger with Alcoa Inc. is subject to certain conditions,
including antitrust clearance.  As discussed under "Merger" in Part I,
Item 1, on September 29, 1999, the Antitrust Division issued a request for
additional information and documentary material (a "second request").
On February 11, 2000, both Reynolds and Alcoa announced that they believed
that they were in substantial compliance with the second request.  They
also advised the Department of Justice that they would not close the merger
before March 31, 2000, in order to provide the Department sufficient time
to review the transaction.  In addition, the European Commission
has until no later than May 10, 2000 to complete its investigation and to
make a final determination with respect to the merger.  Reynolds and Alcoa
have also made filings under the competition laws of Canada, Australia and
certain other countries where the companies have significant operations.
Reynolds and Alcoa have been advised that the Canadian Competition Bureau
has classified this merger as "very complex."  Its review is expected to
be completed by May 24, 2000.  The Australian review process is also
expected to be completed by the end of May 2000.  It is possible that
regulatory authorities may impose conditions on the combined operations
or require divestitures as a condition to approving the merger.  While
Reynolds is working promptly toward completion of the merger, no assurances
can be given as to whether regulatory delays will be encountered or regulatory
conditions to the merger imposed, or the possible effects of such delays or
conditions.


                                 33


<PAGE> 34
RISK FACTORS - continued
------------
In addition to the factors referred to above, Reynolds is exposed to
general financial, political, economic and business risks in connection
with its worldwide operations.  Reynolds continues to evaluate and manage
its operations in a manner to mitigate the effects from exposure to such
risks.  In general, Reynolds' expectations for the future are based on the
assumption that conditions relating to costs, currency values, competition
and the legal, regulatory, financial, political and business environments
in the worldwide economies and markets in which Reynolds operates will not
change significantly overall.




                                  34


<PAGE> 35
ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Forward, futures, option and swap contracts are designated to manage
market risks resulting from fluctuations in the aluminum, natural gas,
foreign currency and debt markets.  Contracts used to manage risks in
these markets are not material.





                                  35


<PAGE> 36
ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

</TABLE>
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF INCOME
(millions, except per share amounts)
==============================================================================
Years ended December 31                          1999       1998        1997
------------------------------------------------------------------------------
<S>                                             <C>        <C>         <C>
REVENUES                                        $4,796     $5,859      $6,900

COSTS AND EXPENSES
 Cost of products sold                           3,928      4,774       5,658
 Selling, general and administrative expenses      361        378         406
 Depreciation and amortization                     242        252         368
 Interest                                           75        114         153
 Merger-related expenses                            19          -           -
 Operational restructuring effects - net             -        144          75
------------------------------------------------------------------------------
                                                 4,625      5,662       6,660
------------------------------------------------------------------------------

EARNINGS
 Income before income taxes, extraordinary
  loss and cumulative effect of accounting
  change                                           171        197         240
 Taxes on income                                    47         45         104
------------------------------------------------------------------------------
 Income before extraordinary loss and
  cumulative effect of accounting change           124        152         136
 Extraordinary loss                                  -        (63)          -
 Cumulative effect of accounting change              -        (23)          -
------------------------------------------------------------------------------

NET INCOME                                      $  124     $   66      $  136
==============================================================================

EARNINGS PER SHARE
 Basic:
  Average shares outstanding                63,739,000  69,709,000  73,412,000
  Income before extraordinary loss and
   cumulative effect of accounting change        $1.95      $2.18       $1.86
  Extraordinary loss                                 -      (0.91)          -
  Cumulative effect of accounting change             -      (0.33)          -
------------------------------------------------------------------------------
  Net income                                     $1.95      $0.94       $1.86
==============================================================================
 Diluted:
  Average shares outstanding                64,043,000  69,937,000  74,004,000
  Income before extraordinary loss and
   cumulative effect of accounting change        $1.94      $2.18       $1.84
  Extraordinary loss                                 -      (0.91)          -
  Cumulative effect of accounting change             -      (0.33)          -
------------------------------------------------------------------------------
  Net income                                     $1.94      $0.94       $1.84
==============================================================================

CASH DIVIDENDS PER COMMON SHARE                  $1.40      $1.40       $1.40
==============================================================================

The accompanying notes to consolidated financial statements are an integral
part of these statements.
</TABLE>

                                    36


<PAGE> 37
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET
==============================================================================
December 31 (millions)                                       1999      1998
------------------------------------------------------------------------------
<S>                                                        <C>       <C>
ASSETS
 Current assets:
   Cash and cash equivalents                               $   55    $   94
   Receivables:
    Customers, less allowances of $10 (1998 - $14)            561       710
    Other                                                      93       184
------------------------------------------------------------------------------
      Total receivables                                       654       894
   Inventories                                                519       500
   Prepaid expenses and other                                  61       114
------------------------------------------------------------------------------
      Total current assets                                  1,289     1,602
 Unincorporated joint ventures and associated companies     1,692     1,478
 Property, plant and equipment - net                        2,016     2,024
 Deferred taxes                                               419       363
 Other assets                                                 534       667
------------------------------------------------------------------------------
Total assets                                               $5,950    $6,134
==============================================================================

LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities:
   Trade payables                                          $  405    $  401
   Accrued compensation and related amounts                   172       183
   Payables to unincorporated joint ventures and
    associated companies                                       48        75
   Commercial paper                                            75        82
   Notes payable to banks                                     105        34
   Long-term debt                                             153       196
   Other liabilities                                          194       270
------------------------------------------------------------------------------
      Total current liabilities                             1,152     1,241
 Long-term debt                                             1,067     1,035
 Postretirement benefits                                      962     1,029
 Environmental                                                138       161
 Deferred taxes                                               287       272
 Other liabilities                                            198       202
 Stockholders' equity:
   Common stock                                             1,575     1,533
   Retained earnings                                        1,257     1,222
   Treasury stock, at cost                                   (626)     (526)
   Accumulated other comprehensive income                     (60)      (35)
------------------------------------------------------------------------------
      Total stockholders' equity                            2,146     2,194
 Contingent liabilities and commitments (Note 13)
------------------------------------------------------------------------------

Total liabilities and stockholders' equity                 $5,950    $6,134
==============================================================================

The accompanying notes to consolidated financial statements are an integral
part of these statements.
</TABLE>


                                      37

<PAGE> 38
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF CASH FLOWS
==============================================================================
Years ended December 31 (millions)         1999         1998         1997
------------------------------------------------------------------------------
<S>                                       <C>         <C>           <C>
OPERATING ACTIVITIES
 Net income                               $ 124       $   66        $ 136
 Adjustments to reconcile to net cash
  provided by operating activities:
    Depreciation and amortization           242          252          368
    Merger-related expenses                  17            -            -
    Operational restructuring effects         -          144           75
    Extraordinary loss                        -           63            -
    Cumulative effect of
     accounting change                        -           23            -
    Other                                    16           (3)          28
    Changes in operating assets
     and liabilities net of
     effects from acquisitions
     and dispositions:
      Accounts payable, accrued
       and other liabilities                (18)        (106)         105
      Receivables                           107          (53)        (194)
      Inventories                            (5)          78         (108)
      Environmental and restructuring
       liabilities                          (43)         (52)         (48)
      Other                                 (34)         (73)           1
------------------------------------------------------------------------------
Net cash provided by operating
 activities                                 406          339          363

INVESTING ACTIVITIES
 Capital investments:
   Operational                             (116)        (155)        (152)
   Strategic                               (410)        (186)        (120)
 Sales of assets - operational
  restructuring                             204        1,147          367
 Other                                      (23)         (38)          (3)
------------------------------------------------------------------------------
Net cash provided by (used in)
 investing activities                      (345)         768           92

FINANCING ACTIVITIES
 Proceeds from long-term debt               250          415            -
 Reduction of long-term debt and
  other financing liabilities              (515)        (929)        (245)
 Increase (decrease) in short-term
  borrowings                                313           47         (138)
 Cash dividends paid                        (90)        (100)         (99)
 Repurchase of common stock                (100)        (526)           -
 Stock options exercised                     42           10           59
------------------------------------------------------------------------------
Net cash used in financing activities      (100)      (1,083)        (423)

CASH AND CASH EQUIVALENTS
 Net increase (decrease)                    (39)          24           32
 At beginning of year                        94           70           38
------------------------------------------------------------------------------

At end of year                            $  55       $   94        $  70
==============================================================================

Supplemental disclosure of cash
 flow information
 Cash paid during the year for:
   Interest                               $ 101       $  134        $ 164
   Income taxes                              40          117           21
==============================================================================

The accompanying notes to consolidated financial statements are an integral
part of these statements.
</TABLE>


                                     38

<PAGE> 39
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
===========================================================================
---------------------------------------------------------------------------
Years ended December 31                 1999       1998        1997
---------------------------------------------------------------------------
<S>                                    <C>         <C>        <C>
SHARES (thousands)
 Common stock
   Balance at January 1                74,105      73,909     72,719
   Shares issued under employee
    benefit plans                         721         196      1,190
---------------------------------------------------------------------------
   Balance at December 31              74,826      74,105     73,909
---------------------------------------------------------------------------
 Treasury stock
   Balance at January 1                (9,648)          -          -
   Purchased and held as
    treasury stock                     (1,696)     (9,648)         -
---------------------------------------------------------------------------
   Balance at December 31             (11,344)     (9,648)         -
---------------------------------------------------------------------------
 Net common shares outstanding         63,482      64,457     73,909
===========================================================================
DOLLARS (millions)
 Common stock
   Balance at January 1                $1,533      $1,521     $1,451
   Shares issued under
    employee benefit plans                 42          12         70
---------------------------------------------------------------------------
   Balance at December 31              $1,575      $1,533     $1,521
---------------------------------------------------------------------------
 Retained earnings
   Balance at January 1                $1,222      $1,253     $1,220
   Net income                             124          66        136
   Cash dividends declared:
    Common stock                          (89)        (97)      (103)
---------------------------------------------------------------------------
   Balance at December 31              $1,257      $1,222     $1,253
---------------------------------------------------------------------------
 Treasury stock
   Balance at January 1                $ (526)     $    -     $    -
   Purchased and held as
    treasury stock                       (100)       (526)         -
---------------------------------------------------------------------------
   Balance at December 31              $ (626)     $ (526)    $    -
---------------------------------------------------------------------------
 Accumulated other comprehensive
  income (loss)
   Balance at January 1                $  (35)     $  (35)    $  (37)

   Foreign currency translation
    adjustments                           (27)          5          -
    Income taxes                            2          (5)         2
                                     --------------------------------------
   Other comprehensive income (loss)      (25)          -          2
---------------------------------------------------------------------------
   Balance at December 31              $  (60)     $  (35)    $  (35)
---------------------------------------------------------------------------
 Total stockholders' equity            $2,146      $2,194     $2,739
===========================================================================
COMPREHENSIVE INCOME (millions)
 Net income                            $  124      $   66     $  136
 Other comprehensive income (loss)        (25)          -          2
---------------------------------------------------------------------------
 Comprehensive income                  $   99      $   66     $  138
===========================================================================

The accompanying notes to consolidated financial statements are an
integral part of these statements.
</TABLE>


                                    39


<PAGE> 40
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In the tables, dollars are in millions, except per share amounts.  Certain
amounts have been reclassified to conform to the 1999 presentation.)

----------------------------------------------------------------------------

1.  ACCOUNTING POLICIES
GENERAL
The consolidated financial statements are prepared in conformity with
generally accepted accounting principles.  As a result, management makes
estimates and assumptions that affect the following:

 . reported amounts of revenues and expenses during the reporting period
 . reported amounts of assets and liabilities at the date of the financial
  statements
 . disclosure of contingent liabilities at the date of the financial
  statements

Actual results could differ from those estimates.

PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company
and its majority-owned subsidiaries after eliminating inter-company
transactions, profits and losses. The Company accounts for investments in
unincorporated joint ventures on an investment cost basis adjusted for the
Company's share of the non-cash production charges of the operation.
Unincorporated joint ventures are production facilities without marketing or
sales activities.  Products produced are distributed in kind and cash
production costs are allocated to the joint venturers based upon their
respective percentage interests in the facilities.  Our operating results
include our share of cash production costs and non-cash production charges
(principally depreciation) as well as revenues from the ultimate sale by us
of our share of the products. Investments in associated companies (20% - 50%
owned) are carried at cost adjusted for the Company's equity in
undistributed net income.

REVENUE RECOGNITION
Revenues are recognized when products are shipped and ownership risk and
title pass to the customer.

INVENTORIES
Inventories are stated at the lower of cost or market.  Inventory costs were
determined by the last-in, first-out (LIFO); first-in, first-out (FIFO); and
average-cost methods.  LIFO method inventories were $171 million at the end
of 1999 (1998 - $178 million).  FIFO and average-cost method inventories
were $348 million at the end of 1999 (1998 - $322 million).  Inventories
would increase by $233 million at the end of 1999 (1998 - $221 million) if
the FIFO method were applied to LIFO method inventories.

The favorable impact of the liquidation of certain LIFO layers that occurred
as a result of the Company's divestitures ($184 million in 1998 and $58
million in 1997) is included in "Operational restructuring effects - net" in
the Consolidated Statement of Income.

Since inventories are sold at various stages of processing, there is no
practical distinction between finished products, in-process products and
other materials.  Inventories are therefore presented as a single
classification.

DEPRECIATION AND AMORTIZATION
The straight-line method is used to depreciate plant and equipment over
their estimated useful lives (buildings and leasehold improvements - 10 to
40 years, machinery and equipment - 5 to 20 years).  Improvements to leased
properties are generally amortized over the shorter of the terms of the
respective leases or the estimated useful life of the improvement.

ENVIRONMENTAL EXPENDITURES
Remediation costs are accrued when it is probable that such efforts will be
required and the related costs can be reasonably estimated.


                                   40

<PAGE> 41
1.  ACCOUNTING POLICIES - continued
POSTEMPLOYMENT BENEFITS
The expected cost of postemployment benefits is accrued when it becomes
probable that such benefits will be paid.

HEDGING
Forward, futures, option and swap contracts are designated to manage market
risks resulting from fluctuations in the aluminum, natural gas, foreign
currency and debt markets.  These instruments, which are not held for
trading purposes, are effective in minimizing such risks by creating equal
and offsetting exposures.  Unrealized gains and losses are deferred and
recorded as a component of the underlying hedged transaction when it occurs.
Realized gains or losses from matured and terminated hedge contracts are
recorded in other assets or liabilities until the underlying hedged
transactions are consummated.  Realized and unrealized gains or losses on
hedge contracts relating to transactions that are subsequently not expected
to occur are recognized in results currently.  None of these instruments
contains multiplier or leverage features.  There is exposure to credit risk
if the other parties to these instruments do not meet their obligations.
Creditworthiness of the other parties is closely monitored, and they are
expected to fulfill their obligations.  Contracts used to manage risks in
these markets are not material.

CUMULATIVE EFFECT OF ACCOUNTING CHANGE
In 1998, the Accounting Standards Executive Committee (AcSEC) of the
American Institute of Certified Public Accountants issued Statement of
Position (SOP) 98-5, "Reporting on the Costs of Start-Up Activities."  The
SOP requires costs of start-up activities and organization costs to be
expensed as incurred.  The Company adopted the SOP in 1998 and recognized an
after-tax charge for the cumulative effect of accounting change of $23
million.

STATEMENT OF CASH FLOWS
In preparing the Consolidated Statement of Cash Flows, all highly liquid,
short-term investments purchased with an original maturity of three months
or less are considered to be cash equivalents.

STOCK OPTIONS
Stock options are accounted for using the intrinsic value method.
Compensation expense is not recognized because the exercise price of the
stock options equals the market price of the underlying stock on the date of
grant.

ACCOUNTING FOR THE COSTS OF DEVELOPING OR OBTAINING INTERNAL-USE SOFTWARE
In 1999, the Company adopted the AcSEC's Statement of Position (SOP) 98-1,
"Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use."  The SOP requires qualifying computer software costs incurred
in connection with obtaining or developing software for internal use to be
capitalized.  In prior years, the Company capitalized costs of purchased
software and expensed internal costs of developing software.  The effect of
adopting this SOP was not material to 1999 results.

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
In 1998, the FASB issued Statement No. 133, "Accounting for Derivative
Instruments and Hedging Activities."  This statement establishes new
accounting and reporting standards for derivative instruments and hedging
activities.  The Company must adopt this statement by January 1, 2001.  The
Company has not determined the impact this statement will have on its
financial position or results of operations.


2.  PROPOSED MERGER
On August 18, 1999, Reynolds, Alcoa Inc. (Alcoa) and RLM Acquisition Corp.,
a wholly owned subsidiary of Alcoa, entered into an agreement and plan of
merger.  Under the merger agreement, each outstanding share of Reynolds
common stock would be converted into 1.06 shares of Alcoa common stock and
Reynolds would become wholly owned by Alcoa.  On January 10, 2000, Alcoa
announced that its Board of Directors had declared a two-for-one split of
Alcoa's common stock to Alcoa shareholders of record on May 26, 2000.  The
stock split is subject to approval of Alcoa shareholders who must approve an
amendment to Alcoa's articles to increase the authorized shares of common
stock at Alcoa's annual meeting on May 12, 2000.  If approved, the stock
split would be distributed on June 9, 2000.  Shares of Alcoa stock that are
issued in the merger will be adjusted, as necessary, to reflect the stock
split.


                                    41

<PAGE> 42
2.  PROPOSED MERGER - continued
The proposed merger, which was approved by Reynolds' stockholders at a
special meeting held on February 11, 2000, is subject to customary closing
conditions, including antitrust clearances.

The Hart-Scott-Rodino Antitrust Improvements Act of 1976 prohibits Alcoa and
Reynolds from completing the merger until certain information has been
furnished to the Antitrust Division of the Department of Justice and the
Federal Trade Commission, and until certain waiting period requirements have
been satisfied.  Alcoa filed a Hart-Scott-Rodino Premerger Notification and
Report Form on August 24, 1999 and Reynolds filed such a Form on August 30,
1999.  On September 29, 1999, the Antitrust Division issued a request for
additional information and documentary material (a "second request").  On
February 11, 2000, both Reynolds and Alcoa announced that they believed that
they were in substantial compliance with the second request.  They also
advised the Department of Justice that they would not close the merger
before March 31, 2000, in order to provide the Department sufficient time to
review the transaction.

In Europe, certain regulations require that Alcoa file a premerger
notification form with the Commission of the European Communities prior to
consummation of the proposed merger.  Alcoa filed such notification on
November 18, 1999.  This filing began an initial one-month review period in
which the European Commission was required to determine whether there are
sufficiently "serious doubts" about the proposed merger's compatibility with
the common market to require a more complete review.  The initial one-month
period expired on December 20, 1999, whereupon the European Commission
issued a determination that the proposed merger did require a more complete
review.  The European Commission must complete its investigation and make a
final determination with respect to the proposed merger no later than May
10, 2000.

Reynolds and Alcoa have also made filings under the competition laws of
Canada, Australia and certain other countries where the companies have
significant operations.  Alcoa and Reynolds have been advised that the
Canadian Competition Bureau has classified this merger as "very complex."
Its review is expected to be completed by May 24, 2000.  The Australian
review process is also expected to be completed by the end of May 2000.

The merger agreement contains certain restrictions on the conduct of
Reynolds' business before completion of the merger.  For example, Reynolds
has agreed to operate its business only in the ordinary course, to refrain
from taking certain corporate actions without the consent of Alcoa, and not
to solicit alternative acquisition proposals.

In 1999, the Company recognized $19 million of merger-related expenses.
Merger-related expenses are principally for investment banking and legal
services and an increase in the expense accrual for a long-term compensation
plan, which varies based principally on appreciation of the Company's stock
price as compared to the S&P Basic Materials Index.  The Company expects
total merger-related expenses to be at least $35 million.


3.  OPERATIONAL RESTRUCTURING
In the first quarter of 1999, the final closing of the sale of the Company's
Alabama can stock complex occurred.  In 1998, the Company sold the following:

 .    U.S. recycling operations
 .    aluminum extrusion facilities in Canada
 .    European rolling mill operations
 .    Illinois sheet and plate plant
 .    North American aluminum beverage can operations
 .    Alabama can stock complex (with final closing in early 1999)


                                    42


<PAGE> 43
3.  OPERATIONAL RESTRUCTURING - continued
In 1997, the Company sold the following:
 .    U.S. residential construction products business
 .    aluminum reclamation plant in Virginia
 .    aluminum extrusion plants in Virginia and Texas
 .    coal properties in Kentucky
 .    one-half of its wholly owned interest in a rolling mill and related
     assets in Canada
 .    aluminum powder and paste plant in Kentucky

Financial information for 1998 and 1997 relating to operations divested is
reflected in the Restructuring category in Note 12.  Customer revenues
generated by these operations were $1.4 billion in 1998 and $2.7 billion in
1997.  Depreciation expense in 1998 was reduced $65 million as a result of
ceasing depreciation on assets held for sale relating to the divestitures.

The favorable impact of the liquidation of certain LIFO layers that occurred
as a result of the Company's divestitures ($184 million in 1998 and $58
million in 1997) is included in "Operational restructuring effects - net" in
the Consolidated Statement of Income.

The Company recognized the following operational restructuring charges:

<TABLE>
<CAPTION>
                                                 1998        1997
                                              ----------------------
     <S>                                        <C>           <C>
     Employee terminations                      $  39         $49
     Additional postretirement benefits           105           -
     Asset dispositions: Losses                   337          85
                         (Gains)                 (349)        (64)
     Other                                         12           5
                                              ----------------------
                                                $ 144         $75
                                              ======================
</TABLE>

The charges for employee terminations recorded in 1998 and 1997 were
principally for severance and related costs for approximately 2,000 salaried
and hourly employees.  The employees worked principally at domestic plants.
Approximately 600 employees worked at corporate headquarters.  Employees
terminated in each period were 1,385 in 1998 and 498 in 1997.

An analysis of the accrual for restructuring liabilities follows:

<TABLE>
<CAPTION>
                                        1999        1998      1997
                                      ------------------------------
     <S>                                <C>         <C>       <C>
     Balance at January 1               $ 48        $ 44      $ 12
      Accruals                             -          44        54
      Payments                           (33)        (40)      (22)
                                      ------------------------------
     Balance at December 31             $ 15        $ 48      $ 44
                                      ==============================
</TABLE>

Liabilities at December 31, 1999 relating to the Company's restructuring
activities are expected to be substantially satisfied in 2000 with cash
provided by operating activities.  Liabilities relating to contractual
postretirement obligations are reflected in postretirement benefits on the
balance sheet and will be settled over numerous future years in conjunction
with the Company's funding of its pension and other postretirement benefit
obligations.

The Company used proceeds from completed divestitures for debt repayments
and repurchases of common stock (see Notes 4 and 9).

Early in the first quarter of 2000, the Company sold its investment in a
Canadian rolling mill and related assets.  This transaction will not have a
material impact on our operating results or financial position.


                                43

<PAGE> 44
4.  EXTRAORDINARY LOSS
The Company had an extraordinary loss from debt extinguishments in 1998 of
$63 million (net of income tax benefit of $39 million).  The debt
extinguished at a loss consisted of $500 million of medium-term notes and
$79 million of 9% debentures.


5.  EARNINGS PER SHARE
The following reconciles income and average shares for the basic and diluted
earnings per share computations for "Income before extraordinary loss and
cumulative effect of accounting change."

<TABLE>
<CAPTION>
                                      1999          1998          1997
                                ---------------------------------------------
<S>                                <C>           <C>           <C>
Income (numerator):
 Income before extraordinary
  loss and cumulative effect
  of accounting change                   $124          $152          $136

Average shares (denominator):
 Basic                             63,739,000    69,709,000    73,412,000
 Effect of dilutive securities        304,000       228,000       592,000
                                ---------------------------------------------
 Diluted                           64,043,000    69,937,000    74,004,000
                                =============================================

Per share amounts for income
 before extraordinary loss
 and cumulative effect of
 accounting change:
  Basic earnings per share              $1.95        $2.18          $1.86
  Diluted earnings per share             1.94         2.18           1.84
Antidilutive securities excluded:
 Stock options                      1,899,000    2,452,000        505,000
</TABLE>


6.   UNINCORPORATED JOINT VENTURES AND ASSOCIATED COMPANIES
The Company has interests in unincorporated joint ventures which produce
alumina and primary aluminum.  It also has interests in foreign-based
associated companies which produce bauxite, alumina, primary aluminum,
hydroelectric power and fabricated aluminum products.  At December 31, the
Company's investment in these activities consisted of the following:

<TABLE>
<CAPTION>
                                                          1999        1998
                                                       ----------------------
      <S>                                               <C>         <C>
      Unincorporated joint ventures
       Current assets                                   $   50      $   52
       Current liabilities                                 (56)        (89)
       Property, plant and equipment and other assets    1,402       1,203
                                                       ----------------------
          Net investment                                 1,396       1,166
                                                       ----------------------
      Associated companies
       Investments                                         236         253
       Advances                                             60          59
                                                       ----------------------
          Net investment                                   296         312
                                                       ----------------------
      Total                                             $1,692      $1,478
                                                       ======================
</TABLE>

Property, plant and equipment and other assets for the unincorporated joint
ventures in 1999 includes $359 million (1998 - $150 million) of construction
in progress for the expansion of the Worsley Alumina Refinery joint venture.


                                  44


<PAGE> 45
7.  PROPERTY, PLANT AND EQUIPMENT (AT COST)
<TABLE>
<CAPTION>
                                                             December 31
                                                        --------------------
                                                           1999     1998
                                                        --------------------
     <S>                                                  <C>      <C>
     Land, land improvements and mineral properties       $  252   $  244
     Buildings and leasehold improvements                    803      781
     Machinery and equipment                               3,148    3,087
     Construction in progress                                133      170
                                                        --------------------
                                                           4,336    4,282
     Less allowances for depreciation and amortization     2,320    2,258
                                                        --------------------
     Net property, plant and equipment                    $2,016   $2,024
                                                        ====================
</TABLE>

8.  FINANCING ARRANGEMENTS
<TABLE>
<CAPTION>
                                                  December 31
                                              -------------------
                                                1999      1998
                                              -------------------
     <S>                                       <C>       <C>
     Public debt securities:
       Medium-term notes                       $  418    $  329
       9-3/8% debentures due 1999                   -       100
       9% debentures due 2003                      21        21
       6-5/8% amortizing notes                    171       228
       Industrial and environmental
        control revenue bonds                     201       227
       Commercial paper                           250         -
     Other arrangements:
       Long-term credit facilities                150       315
       Mortgages and other notes payable            9        11
                                              -------------------
                                                1,220     1,231
     Amounts due within one year                  153       196
                                              -------------------
     Long-term debt                            $1,067    $1,035
                                              ===================
</TABLE>


Long-term debt at December 31, 1999 matures as follows:

                     2000                 $153
                     2001                  569
                     2002                   70
                     2003                   58
                     2004                   35
                     2005 - 2025           335

The medium-term notes and 9% debentures were issued under a shelf
registration.  The medium-term notes bear interest at an average fixed rate
of 8.5% and have maturities ranging from 2000 to 2013.  At December 31,
1999, $13 million of debt securities remained unissued under the shelf
registration.  In early 2000, the Company increased the amount of debt
securities it can issue under the shelf registration to $163 million.  A
portion of this fixed-rate debt has been effectively converted to a variable
rate through the use of a $100-million interest rate swap that matures in
2001.  Under the swap, payments are received based on a fixed rate (6%) and
made based on a variable rate (5.9% at December 31, 1999).  The variable
rate is based on the London Interbank Offer Rate (LIBOR).  The differential
to be paid or received as interest rates change is accrued and recognized as
an adjustment of interest expense.  The fair value of this agreement and its
effect on interest expense was not material.

The 6-5/8% amortizing notes were issued at a discount (99.48%) and have an
effective interest rate of 6.7%.  The notes require annual principal
repayments of $57 million between 2000 and 2002.


                                   45

<PAGE> 46
8.  FINANCING ARRANGEMENTS - continued
Industrial and environmental control revenue bonds consist principally of
variable-rate debt with interest rates averaging 4.8% at December 31, 1999.
The variable rates are based on market interest rates.  These bonds require
principal repayments in lump sums periodically between 2000 and 2025.
Letters of credit issued by banks support most of these bonds.

The Company has classified $250 million of commercial paper as long-term
debt because the Company intends to refinance the debt on a long-term basis
and the commercial paper is supported by a $500 million long-term credit
facility.  The Company also has a $150 million long-term credit facility.
These long-term credit facilities have variable interest rates (6.4% at
December 31, 1999) and mature in 2001.  The variable rates are based on
LIBOR.  The Company pays an annual commitment fee of .1% on the unused
portion of these facilities.  In addition to the long-term credit
facilities, the Company has a short-term credit facility of $185 million
that was unutilized and available at December 31, 1999.  This credit
facility has a variable interest rate that is based on LIBOR.  The Company
pays an annual commitment fee of .125% on the unused portion.

Certain financing arrangements contain restrictions that primarily consist
of requirements to maintain specified financial ratios.  These restrictions
do not inhibit operations or the use of fixed assets.  At December 31, 1999,
the Company exceeded all such requirements.

The fair value of long-term debt was approximately equal to book value at
the end of 1999 and 1998.  The fair value was determined by using discounted
cash flow analysis.

Interest capitalized was $24 million during 1999 (1998 - $12 million, 1997 -
$8 million).

Interest rates on short-term borrowings are based on market rates.  The
weighted-average interest rates were:


<TABLE>
<CAPTION>
                                           December 31
                                     ----------------------
                                       1999          1998
                                     ----------------------
            <S>                        <C>           <C>
            Notes payable to banks     6.5%          4.2%

            Commercial paper           6.5           5.9
</TABLE>

9.  STOCKHOLDERS' EQUITY
PREFERRED STOCK
The Company has 21,000,000 shares of preferred stock authorized.  Two million
shares have been designated Series A Junior Participating Preferred.

COMMON STOCK
The Company has 200,000,000 shares of common stock (without par value)
authorized.

The Company has authorization to repurchase up to 18 million shares of common
stock of which approximately 11.3 million shares have been repurchased through
December 31, 1999.  (See the Consolidated Statement of Changes in Stockholders'
Equity for additional share repurchase information.)  Under the merger
agreement with Alcoa, the Company has agreed to refrain from purchasing
additional shares without the consent of Alcoa.  (See Note 2.)


                                  46

<PAGE> 47
9.  STOCKHOLDERS' EQUITY - continued
STOCK OPTIONS
The Company has a non-qualified stock option plan under which key employees
may be granted stock options at a price equal to the fair market value at
the date of grant.  The stock options outstanding at December 31, 1999 vest
in one year and are exercisable between one year and ten years from the
date of grant.  Upon a change in control of the Company, all outstanding
options would become immediately exercisable.  The range of exercise prices
for the stock options outstanding at December 31, 1999 was $45 to $64 and
their weighted-average remaining contractual life was 6 years.  A summary
of stock option activity and related information follows (options are in
thousands):

<TABLE>
<CAPTION>
                                       1999           1998           1997
                                    ----------------------------------------
     <S>                              <C>            <C>           <C>
     Outstanding at January 1         5,254          4,828          5,318
     Granted                            713            633            711
     Exercised                         (721)          (192)        (1,190)
     Expired/canceled                  (444)           (15)           (11)
                                    ----------------------------------------
     Outstanding at December 31       4,802          5,254          4,828
     Exercisable at December 31       4,092          4,621          4,121
     Available for grant              2,007            304            923

     Weighted-average prices:
      Outstanding at January 1          $56            $55            $52
      Granted                            61             62             64
      Exercised                          54             47             50
      Expired/canceled                   60             62             56
      Outstanding at December 31         57             56             55
      Exercisable at December 31         56             55             53
</TABLE>

In addition to the above, 150,000 performance-based stock options expired in
1999.

Pro forma net income and earnings per share have been prepared based on
expensing (after tax) the estimated fair value of stock options granted
during 1999, 1998 and 1997.  The estimated fair value of the stock options
was determined by using the Black-Scholes option-pricing model.  The
estimated fair values and the weighted-average assumptions used to estimate
those values follow:

<TABLE>
<CAPTION>
                                                     Stock Options
                                         -----------------------------------
                                             1999        1998        1997
                                         -----------------------------------
     <S>                                    <C>         <C>         <C>
     Risk-free interest rate                 5.6%        5.5%        6.4%
     Dividend yield                          2.1%        2.2%        2.2%
     Volatility factor of the expected
      market price of the Company's
      common stock                           .270        .256        .265
     Expected life of the option            6 years     6 years     6 years
     Estimated fair value of each stock
      option granted                        $18.04      $17.53      $19.53
</TABLE>


                                      47


<PAGE> 48
9.  STOCKHOLDERS' EQUITY - continued
STOCK OPTIONS - continued
The Black-Scholes option-pricing model was not developed for use in valuing
employee stock options.  This model was developed for use in estimating the
fair value of traded options that have no vesting restrictions and are
fully transferable.  In addition, it requires the input of highly
subjective assumptions including expectations of future dividends and stock
price volatility.  The assumptions are only used for making the required
fair value estimate and should not be considered as indicators of future
dividend policy or stock price appreciation.  Because changes in the
subjective input assumptions can materially affect the fair value estimate
and because the employee stock options have characteristics significantly
different from those of traded options, the use of the Black-Scholes option-
pricing model may not provide a reliable single measure of the employee
stock options' value.

The pro forma information follows:
<TABLE>
<CAPTION>
                                               1999     1998     1997
                                             -------------------------
       <S>                                    <C>      <C>      <C>
       Pro forma net income                   $ 117    $  59    $ 127
       Pro forma earnings per share: Basic     1.83     0.84     1.73
                                     Diluted   1.82     0.84     1.72
</TABLE>

SHAREHOLDER RIGHTS PLAN
Under the shareholder rights plan each share of common stock has one right
attached and the rights trade with the common stock.  The rights are
exercisable only if a person or group buys 15% or more of the Company's
common stock, or announces a tender offer for 15% or more of the
outstanding common stock.  Each right will entitle a holder to buy one-
hundredth of a share of the Company's Series A Junior Participating
Preferred Stock at an exercise price of $300.

If a person or group acquires 15% or more of the common stock of the
Company, each right would permit its holder to buy common stock of the
Company having a market value equal to two times the exercise price of the
right.  In addition, if at any time after the rights become exercisable, the
Company is acquired in a merger, or if there is a sale or transfer of 50%
or more of its assets or earning power, each right would permit its holder
to buy common stock of the acquiring company having a market value equal to
two times the exercise price of the right.

The rights, which do not have voting privileges, expire in 2007.  The Board
of Directors may redeem the rights before expiration, under certain
circumstances, for $0.01 per right.  Until the rights become exercisable,
they have no effect on earnings per share.

These rights should not interfere with a business combination approved by
the Board of Directors.  However, they will cause substantial dilution to a
person or group that attempts to acquire the Company without conditioning
the offer on redemption of the rights or acquiring a substantial number of
the rights.

In connection with the merger agreement with Alcoa (see Note 2), the
Company amended the shareholder rights plan to render the plan inapplicable
to this transaction.



                                  48

<PAGE> 49
10.  PENSIONS AND OTHER POSTRETIREMENT BENEFITS
<TABLE>
<CAPTION>
                                  Pension Benefits          Other Benefits
                                --------------------    ----------------------
                                 1999         1998         1999        1998
                                --------------------    ----------------------
<S>                             <C>          <C>          <C>        <C>
CHANGE IN BENEFIT OBLIGATION
Benefit obligation at
 beginning of year              $2,349       $2,081       $  964     $   899
Service cost                        31           36            6           7
Interest cost                      162          151           62          62
Amendments                           1            9            1           -
Actuarial losses (gains)           (87)         166          (70)         60
Restructuring                        -           39            -           5
Benefits paid                     (161)        (133)         (79)        (69)
                                --------------------    ----------------------
Benefit obligation at
 end of year                    $2,295       $2,349       $  884     $   964
                                --------------------    ----------------------

CHANGE IN PLAN ASSETS
Fair value of plan assets
 at beginning of year           $2,277       $2,099       $    -     $     -
Actual return on plan assets       383          295            -           -
Company contributions               46           43           79          69
Restructuring                        -          (27)           -           -
Benefits paid                     (161)        (133)         (79)        (69)
                                --------------------    ----------------------
Fair value of plan assets
 at end of year                 $2,545       $2,277       $    -     $     -
                                --------------------    ----------------------

Funded status of the plans      $  250       $  (72)      $ (884)    $  (964)
Unrecognized net actuarial
 loss (gain)                      (222)         101          (42)         27
Unrecognized prior service cost     59           66          (56)        (67)
                                --------------------    ----------------------
Prepaid (accrued) benefit cost  $   87       $   95       $ (982)    $(1,004)
                                ====================    ======================

AMOUNTS RECOGNIZED IN THE
 CONSOLIDATED BALANCE SHEET
Prepaid benefit cost            $  111       $  111       $    -     $     -
Accrued benefit liability          (37)         (68)        (982)     (1,004)
Intangible asset                    13           52            -           -
                                --------------------    ----------------------
Net amount recognized           $   87       $   95       $ (982)    $(1,004)
                                ====================    ======================


WEIGHTED-AVERAGE ASSUMPTIONS
 AS OF DECEMBER 31
Discount rate                     7.50%        6.75%        7.50%       6.75%
Expected return on plan assets    9.25         9.25            -           -
Rate of compensation increase     4.50         4.50            -           -
</TABLE>

                                        49


<PAGE> 50
10.  PENSIONS AND OTHER POSTRETIREMENT BENEFITS - continued
For measurement purposes, a 5.5% annual rate of increase in the per capita
cost of covered health care benefits was assumed for 2000.  The rate was
assumed to decrease gradually to 5.0% in 2002 and remain at that level
thereafter.

<TABLE>
<CAPTION>
                         Pension Benefits            Other Benefits
                      ----------------------    -----------------------
                       1999    1998    1997      1999    1998    1997
                      ----------------------    -----------------------

<S>                    <C>    <C>      <C>       <C>      <C>    <C>
COMPONENTS OF
 NET PERIODIC
 BENEFIT COST
Service cost           $ 31    $ 36    $ 37      $  6     $ 7    $  7
Interest cost           162     151     147        62      62      64
Expected return
 on plan assets        (189)   (175)   (158)        -       -       -
Amortization of
 prior service cost      11      14      19       (10)    (13)    (17)
Recognized net
 actuarial loss (gain)   16      13      11         -       -      (1)
                      ----------------------    -----------------------
Benefit cost           $ 31    $ 39    $ 56       $58     $56    $ 53
                      ======================    =======================
</TABLE>

The assumed health care cost trend rate has a significant effect on the
amounts reported.  A one-percentage-point change in the assumed health care
cost trend rate would have the following effects:

<TABLE>
<CAPTION>
                                       1%           1%
                                    Increase     Decrease
                                   ----------   ----------
   <S>                                <C>         <C>
   Effect on total of service
    and interest cost
    components in 1999                $  3        $ (3)
   Effect on postretirement
    benefit obligation
    as of December 31, 1999           $ 39        $(35)
</TABLE>


11.  TAXES ON INCOME
The significant components of the provision for income taxes were:


<TABLE>
<CAPTION>
                                    1999      1998       1997
                                 -------------------------------
               <S>                  <C>       <C>        <C>
               Current:
                Federal             $  7      $  6       $ 13
                Foreign               41        57         71
                State                  1         1          1
                                 -------------------------------
                Total current         49        64         85
                                 -------------------------------

               Deferred:
                Federal                8       (31)        (7)
                Foreign                5        23         21
                State                (14)      (12)        (2)
                                 -------------------------------
                Total deferred        (1)      (20)        12
                                 -------------------------------
               Equity income          (1)        1          7
                                 -------------------------------
               Total                 $47       $45       $104
                                 ===============================
</TABLE>

The deferred tax provision includes domestic carryforward
benefits of $11 million (1998 - $8 million, 1997 - $2 million).


                                50

<PAGE> 51
11.  TAXES ON INCOME - continued
The effective income tax rate varied from the U.S. statutory rate as
follows:

<TABLE>
<CAPTION>
                                     1999    1998    1997
                                   ------------------------
        <S>                           <C>     <C>     <C>
        U.S. rate                     35%     35%     35%
        Income taxed at other
         than the U.S. rate            1      (4)      9
        Percentage depletion          (2)     (3)     (2)
        Credits and other tax
         benefits                     (5)     (6)      -
        State income taxes
         and other                    (1)      1       1
                                   ------------------------
        Effective rate                28%     23%     43%
                                   ========================
</TABLE>

Income taxed at other than the U.S. rate includes a 10% adverse effect in
1997 from basis differences on asset dispositions.

Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes.  At
December 31, 1999, the Company had $822 million (1998 - $844 million) of
deferred tax assets and $675 million (1998 - $694 million) of deferred tax
liabilities that have been netted with respect to tax jurisdictions for
presentation purposes.  The significant components of these amounts were:

<TABLE>
<CAPTION>
                                    1999                    1998
                             ---------------------------------------------
                               Asset   Liability       Asset   Liability
                             ---------------------------------------------
<S>                            <C>       <C>            <C>      <C>
Retiree health benefits         374      $  -           $381     $  -
Tax carryforward benefits       170         -            141        -
Environmental and
 restructuring costs             86        (2)           116       (2)
Other                            60        95             39       78
Tax over book depreciation     (236)      194           (235)     196
Valuation reserve relating
 to tax carryforward benefits   (20)        -            (20)       -
                             ---------------------------------------------
Total deferred tax assets
 and liabilities                434       287            422      272
Amount included as current
 in balance sheet                15         -             59        -
                             ---------------------------------------------
Noncurrent deferred tax
 assets and liabilities        $419      $287           $363     $272
                             =============================================
</TABLE>

The tax carryforward benefits can be carried forward indefinitely except for
$68 million that will expire primarily between 2004 and 2014.  A valuation
reserve of $20 million relating to certain of these benefits has been
recorded. Alternatives continue to be evaluated that may result in the
ultimate realization of a portion of these reserved assets.

Income taxes have not been provided on the undistributed earnings ($904
million) of foreign subsidiaries. The Company uses these earnings to finance
foreign expansion, reduce foreign debt or support foreign operating
requirements.

The geographic components of income (loss) before income taxes,
extraordinary loss and the cumulative effect of accounting change was as
follows:

<TABLE>
<CAPTION>
                                1999         1998          1997
                              ------------------------------------
                 <S>            <C>          <C>           <C>
                 Domestic       $(67)        $(86)         $ 21
                 Foreign         238          283           219
                              ------------------------------------
                                $171         $197          $240
                              ====================================

</TABLE>

                                   51

<PAGE> 52
12.  COMPANY OPERATIONS
The Company is organized into four market-based, global business units.  The
global business units and their principal products are:

 . Base Materials - alumina, carbon products, primary aluminum ingot and
  billet, and electrical rod
 . Packaging and Consumer - aluminum and plastic packaging, foodservice
  and consumer products; printing products
 . Construction and Distribution - architectural construction products and
  the distribution of a wide variety of aluminum and stainless steel products
 . Transportation - aluminum wheels, heat exchangers and automotive
  structures

The Restructuring category includes operations sold.  (See Note 3 for a
discussion of the Company's restructuring activities.)

The Other category consists principally of European extrusion operations,
investments in Canada, China, Latin America and Saudi Arabia and real
estate.  Part of the real estate, principally undeveloped land, is held for
sale and is expected to be sold over the next few years.  The carrying
amount for these held-for-sale assets was $36 million at December 31, 1999.
Expenses relating to holding these assets, principally real estate taxes,
were approximately $1 million per year in each of the last three years.

ACCOUNTING POLICIES
Operating income for each global business unit is calculated as revenues
plus equity income less cost of products sold, depreciation and the unit's
selling, general and administrative expenses.  The sales between units are
made at market-related prices.  Cost of products sold reflects current
costs.

Assets for each global business unit include:

 .    receivables (including internal receivables from other units)
 .    inventories (based on the FIFO method)
 .    property, plant and equipment (excluding construction in progress)
 .    investments in unincorporated joint ventures and associated companies
 .    other assets directly associated with the unit's operations

Current liabilities for each global business unit include:

 .    trade payables
 .    accrued compensation and related amounts
 .    other current liabilities
 .    internal liabilities from other units

For the geographic presentation, revenues are attributed to specific
countries based on the location of the operation generating the revenue.
Long-lived assets consist of all noncurrent assets such as property, plant
and equipment and investments in joint ventures and associated companies.


                                 52

<PAGE> 53
12.  COMPANY OPERATIONS - continued
Certain amounts for the years 1998 and 1997 have been reclassified to
conform to the 1999 presentation.  The principal reclassification was to
move corporate amounts from the Other category to Reconciling Items.

<TABLE>
<CAPTION>
                                                     Packaging   Construction
                                             Base       and         and
1999                                      Materials   Consumer   Distribution
==============================================================================
<S>                                        <C>        <C>         <C>
Customer aluminum shipments                   867        152         202
Intersegment aluminum shipments               211          -           -
------------------------------------------------------------------------------
Total aluminum shipments                    1,078        152         202
==============================================================================

Revenues:
 Aluminum                                  $1,325     $  817      $  679
 Nonaluminum                                  368        632         346
Intersegment revenues - aluminum              306          -           -
------------------------------------------------------------------------------
Total revenues                             $1,999     $1,449      $1,025
==============================================================================

Segment operating income (loss)            $  250     $  159      $   42
Inventory accounting adjustments
Corporate amounts
Operational restructuring effects - net
Merger-related expenses
------------------------------------------------------------------------------
Corporate operating income

Interest expense
Taxes on income
Extraordinary loss
Cumulative effect of accounting change
------------------------------------------------------------------------------

Net income
==============================================================================
Pre-tax equity income (loss) included
 in revenues                               $    -     $    -      $    -
Depreciation and amortization                 146         45           8

Assets                                     $3,085     $  665      $  463
Current liabilities (excluding debt)          276        137         126
------------------------------------------------------------------------------
Net operating investment                   $2,809     $  528      $  337
==============================================================================
Unincorporated joint ventures and
 associated companies                      $1,516     $    -      $    -
Capital investments                           309         84          84
==============================================================================
</TABLE>

                                     53

<PAGE> 54
<TABLE>
<CAPTION>
1999                                 Transportation  Restructuring  Other
==============================================================================
<S>                                        <C>        <C>         <C>
Customer aluminum shipments                    73          -          59
Intersegment aluminum shipments                 -          -           -
------------------------------------------------------------------------------
Total aluminum shipments                       73          -          59
==============================================================================

Revenues:
 Aluminum                                    $398     $    -        $145
 Nonaluminum                                    -          -          42
Intersegment revenues - aluminum                -          -           -
------------------------------------------------------------------------------
Total revenues                               $398     $    -        $187
==============================================================================

Segment operating income (loss)              $(28)    $    -        $  5
Inventory accounting adjustments
Corporate amounts
Operational restructuring effects - net
Merger-related expenses
------------------------------------------------------------------------------
Corporate operating income

Interest expense
Taxes on income
Extraordinary loss
Cumulative effect of accounting change
------------------------------------------------------------------------------

Net income
==============================================================================
Pre-tax equity income (loss) included
 in revenues                                 $  -     $    -        $(14)
Depreciation and amortization                  29          -           7

Assets                                       $377     $    -        $395
Current liabilities (excluding debt)           60          -          12
------------------------------------------------------------------------------
Net operating investment                     $317     $    -        $383
==============================================================================
Unincorporated joint ventures and
 associated companies                        $  8     $    -        $168
Capital investments                            26          -           2
==============================================================================
</TABLE>


<TABLE>
<CAPTION>

                                          Total   Reconciling
1999                                    Segments     Items     Consolidated
==============================================================================
<S>                                        <C>        <C>         <C>
Customer aluminum shipments                 1,353         -        1,353
Intersegment aluminum shipments               211      (211)           -
------------------------------------------------------------------------------
Total aluminum shipments                    1,564      (211)       1,353
==============================================================================

Revenues:
 Aluminum                                  $3,364    $    -       $3,364
 Nonaluminum                                1,388        44        1,432
Intersegment revenues - aluminum              306      (306)           -
------------------------------------------------------------------------------
Total revenues                             $5,058    $ (262)      $4,796
==============================================================================

Segment operating income (loss)            $  428    $    -       $  428
Inventory accounting adjustments                                      (4)
Corporate amounts                                                   (159)
Operational restructuring effects - net                                -
Merger-related expenses                                              (19)
------------------------------------------------------------------------------
Corporate operating income                                           246

Interest expense                                                     (75)
Taxes on income                                                      (47)
Extraordinary loss                                                     -
Cumulative effect of accounting change                                 -
------------------------------------------------------------------------------

Net income                                                        $  124
==============================================================================
Pre-tax equity income (loss) included
 in revenues                               $  (14)   $    -       $  (14)
Depreciation and amortization                 235         7          242

Assets                                     $4,985    $  965       $5,950
Current liabilities (excluding debt)          611       208          819
------------------------------------------------------------------------------
Net operating investment                   $4,374    $  757       $5,131
==============================================================================
Unincorporated joint ventures and
 associated companies                      $1,692    $    -       $1,692
Capital investments                           505        21          526
==============================================================================
</TABLE>

                                       54

<PAGE> 55
12.  COMPANY OPERATIONS - continued
<TABLE>
<CAPTION>
                                                     Packaging  Construction
                                             Base      and          and
1998                                      Materials  Consumer   Distribution
==============================================================================
<S>                                        <C>        <C>         <C>
Customer aluminum shipments                   668       141         184
Intersegment aluminum shipments               354         -           -
------------------------------------------------------------------------------
Total aluminum shipments                    1,022       141         184
==============================================================================

Revenues:
 Aluminum                                  $1,055    $  787        $681
 Nonaluminum                                  402       605         314
Intersegment revenues - aluminum              572         -           -
------------------------------------------------------------------------------
Total revenues                             $2,029    $1,392        $995
==============================================================================

Segment operating income (loss)            $  290    $  156        $ 39
Inventory accounting adjustments
Corporate amounts
Operational restructuring effects - net
------------------------------------------------------------------------------
Corporate operating income

Interest expense
Taxes on income
Extraordinary loss
Cumulative effect of accounting change
------------------------------------------------------------------------------

Net income
==============================================================================
Pre-tax equity income (loss) included
 in revenues                               $   (3)   $    -        $  -
Depreciation and amortization                 138        44           7

Assets                                     $3,000    $  625        $375
Current liabilities (excluding debt)          305       110          86
------------------------------------------------------------------------------
Net operating investment                   $2,695    $  515        $289
==============================================================================
Unincorporated joint ventures and
 associated companies                      $1,299    $    -        $  -
Capital investments                           228        38          10
==============================================================================
</TABLE>

                                       55

<PAGE> 56
<TABLE>
<CAPTION>
1998                               Transportation  Restructuring  Other
==============================================================================
<S>                                        <C>        <C>         <C>
Customer aluminum shipments                  63          391        37
Intersegment aluminum shipments               -            4         -
------------------------------------------------------------------------------
Total aluminum shipments                     63          395        37
==============================================================================

Revenues:
 Aluminum                                  $336       $1,434      $117
 Nonaluminum                                  -           17        47
Intersegment revenues - aluminum              -           12         -
------------------------------------------------------------------------------
Total revenues                             $336       $1,463      $164
==============================================================================

Segment operating income (loss)            $(19)      $  124      $  -
Inventory accounting adjustments
Corporate amounts
Operational restructuring effects - net
------------------------------------------------------------------------------
Corporate operating income

Interest expense
Taxes on income
Extraordinary loss
Cumulative effect of accounting change
------------------------------------------------------------------------------

Net income
==============================================================================
Pre-tax equity income (loss) included
 in revenues                               $ (1)      $    -      $(10)
Depreciation and amortization                25           26         4

Assets                                     $352       $  282      $417
Current liabilities (excluding debt)         53           66        34
------------------------------------------------------------------------------
Net operating investment                   $299       $  216      $383
==============================================================================
Unincorporated joint ventures and
 associated companies                      $  7       $    -      $172
Capital investments                          50            -         4
==============================================================================
</TABLE>

<TABLE>
<CAPTION>
                                           Total    Reconciling
1998                                      Segments     Items    Consolidated
==============================================================================
<S>                                        <C>        <C>         <C>
Customer aluminum shipments                 1,484          -       1,484
Intersegment aluminum shipments               358       (358)          -
------------------------------------------------------------------------------
Total aluminum shipments                    1,842       (358)      1,484
==============================================================================

Revenues:
 Aluminum                                  $4,410     $    -      $4,410
 Nonaluminum                                1,385         64       1,449
Intersegment revenues - aluminum              584       (584)          -
------------------------------------------------------------------------------
Total revenues                             $6,379     $ (520)     $5,859
==============================================================================

Segment operating income (loss)            $  590                 $  590
Inventory accounting adjustments                                       5
Corporate amounts                                                   (140)
Operational restructuring effects - net                             (144)
------------------------------------------------------------------------------
Corporate operating income                                           311

Interest expense                                                    (114)
Taxes on income                                                      (45)
Extraordinary loss                                                   (63)
Cumulative effect of accounting change                               (23)
------------------------------------------------------------------------------

Net income                                                        $   66
==============================================================================
Pre-tax equity income (loss) included
 in revenues                               $  (14)    $    -      $  (14)
Depreciation and amortization                 244          8         252

Assets                                     $5,051     $1,083      $6,134
Current liabilities (excluding debt)          654        275         929
------------------------------------------------------------------------------
Net operating investment                   $4,397     $  808      $5,205
==============================================================================
Unincorporated joint ventures and
 associated companies                      $1,478     $    -      $1,478
Capital investments                           330         11         341
==============================================================================
</TABLE>


                                      56

<PAGE> 57
12.  COMPANY OPERATIONS - continued
<TABLE>
<CAPTION>
                                                   Packaging  Construction
                                          Base        and         and
1997                                    Materials  Consumer   Distribution
==============================================================================
<S>                                      <C>        <C>           <C>
Customer aluminum shipments                 513        142         166
Intersegment aluminum shipments             684          -           -
------------------------------------------------------------------------------
Total aluminum shipments                  1,197        142         166
==============================================================================

Revenues:
 Aluminum                                $  923     $  797        $614
 Nonaluminum                                405        602         328
Intersegment revenues - aluminum          1,187          -           -
------------------------------------------------------------------------------
Total revenues                           $2,515     $1,399        $942
==============================================================================

Segment operating income                 $  312     $  141        $ 41
Inventory accounting adjustments
Corporate amounts
Operational restructuring effects - net
------------------------------------------------------------------------------
Corporate operating income

Interest expense
Taxes on income
Extraordinary loss
Cumulative effect of accounting change
------------------------------------------------------------------------------

Net income
==============================================================================
Pre-tax equity income (loss) included
 in revenues                             $   (2)    $    -        $  -
Depreciation and amortization               135         47           5

Assets                                   $3,154     $  663        $381
Current liabilities (excluding debt)        289        114         102
------------------------------------------------------------------------------
Net operating investment                 $2,865     $  549        $279
==============================================================================
Unincorporated joint ventures and
 associated companies                    $1,177     $    -        $  -
Capital investments                         105         41           9
==============================================================================
</TABLE>


                                      57

<PAGE> 58
<TABLE>
<CAPTION>
1997                               Transportation  Restructuring  Other
==============================================================================
<S>                                      <C>        <C>           <C>
Customer aluminum shipments                  66        737          39
Intersegment aluminum shipments               -         10           -
------------------------------------------------------------------------------
Total aluminum shipments                     66        747          39
==============================================================================

Revenues:
 Aluminum                                  $353     $2,610        $126
 Nonaluminum                                  -         72          28
Intersegment revenues - aluminum              -         33           -
------------------------------------------------------------------------------
Total revenues                             $353     $2,715        $154
==============================================================================

Segment operating income                   $ 10     $  102        $  5
Inventory accounting adjustments
Corporate amounts
Operational restructuring effects - net
------------------------------------------------------------------------------
Corporate operating income

Interest expense
Taxes on income
Extraordinary loss
Cumulative effect of accounting change
------------------------------------------------------------------------------

Net income
==============================================================================
Pre-tax equity income (loss) included
 in revenues                               $  1     $    -        $ (4)
Depreciation and amortization                26        143           4

Assets                                     $331     $1,921        $442
Current liabilities (excluding debt)         46        212          17
------------------------------------------------------------------------------
Net operating investment                   $285     $1,709        $425
==============================================================================
Unincorporated joint ventures and
 associated companies                      $  8     $    -        $196
Capital investments                          40         33          30
==============================================================================
</TABLE>

<TABLE>
<CAPTION>

                                            Total  Reconciling
1997                                      Segments    Items     Consolidated
==============================================================================
<S>                                        <C>        <C>           <C>
Customer aluminum shipments                 1,663           -        1,663
Intersegment aluminum shipments               694        (694)           -
------------------------------------------------------------------------------
Total aluminum shipments                    2,357        (694)       1,663
==============================================================================

Revenues:
 Aluminum                                  $5,423     $     -       $5,423
 Nonaluminum                                1,435          42        1,477
Intersegment revenues - aluminum            1,220      (1,220)           -
------------------------------------------------------------------------------
Total revenues                             $8,078     $(1,178)      $6,900
==============================================================================

Segment operating income                   $  611                   $  611
Inventory accounting adjustments                                       (12)
Corporate amounts                                                     (131)
Operational restructuring effects - net                                (75)
------------------------------------------------------------------------------
Corporate operating income                                             393

Interest expense                                                      (153)
Taxes on income                                                       (104)
Extraordinary loss                                                       -
Cumulative effect of accounting change                                   -
------------------------------------------------------------------------------

Net income                                                          $  136
==============================================================================
Pre-tax equity income (loss) included
 in revenues                               $   (5)    $     -       $   (5)
Depreciation and amortization                 360           8          368

Assets                                     $6,892     $   334       $7,226
Current liabilities (excluding debt)          780         294        1,074
------------------------------------------------------------------------------
Net operating investment                   $6,112     $    40       $6,152
==============================================================================
Unincorporated joint ventures and
 associated companies                      $1,381     $     -       $1,381
Capital investments                           258          14          272
==============================================================================
</TABLE>

                                     58

<PAGE> 59
12.  COMPANY OPERATIONS - continued
RECONCILING ITEMS
Reconciling items consist of the following:

<TABLE>
<CAPTION>
                                        1999      1998      1997
                                    --------------------------------
<S>                                    <C>       <C>       <C>
Assets:
 Corporate assets                      $ 830     $1,106    $ 917
 Construction in progress                492        320      155
 Inventory accounting adjustments       (266)      (248)    (547)
 Internal receivables included in
  the assets of the global
  business units                         (91)       (95)    (191)
                                    --------------------------------
                                       $ 965     $1,083     $334
                                    ================================

Current liabilities:
 Corporate liabilities                 $ 261     $  287     $398

 Payables to unincorporated joint
  ventures and associated companies       48         75       81
 Internal liabilities included in
  the current liabilities of the
  global business units                 (101)       (87)    (185)
                                    --------------------------------
                                       $ 208     $  275     $294
                                    ================================
</TABLE>


The reconciling amounts for nonaluminum revenues, depreciation and
amortization and capital investments relate to corporate activities.

Inventory accounting adjustments include elimination of unrealized profits
on sales between global business units and LIFO inventory adjustments.
Construction in progress in 1999 includes $359 million (1998 - $150 million)
related to the expansion of the Worsley Alumina Refinery joint venture in
Australia.

Research and development expenditures were $25 million in 1999 (1998 - $31
million, 1997 - $41 million).

<TABLE>
<CAPTION>
GEOGRAPHIC

                       Domestic     Canada   Other Foreign   Consolidated
============================================================================
<S>                     <C>         <C>         <C>             <C>
1999
Revenues                $3,640      $  558      $  598          $4,796
Long-lived assets        1,735       1,226       1,281           4,242
============================================================================
1998
Revenues                $4,653      $  452      $  754          $5,859
Long-lived assets        1,822       1,261       1,086           4,169
============================================================================
1997
Revenues                $5,306      $  523      $1,071          $6,900
Long-lived assets        2,582       1,321       1,080           4,983
============================================================================
</TABLE>

The majority of the Other Foreign category is comprised of European
operations except that long-lived assets include $891 million in 1999 ($673
million in 1998 and $569 million in 1997) related to the Worsley Alumina
Refinery joint venture located in Australia.


                                   59

<PAGE> 60
13.  CONTINGENT LIABILITIES AND COMMITMENTS
LEGAL
Various suits, claims and actions are pending against the Company.  In the
opinion of management, after consultation with legal counsel, disposition of
these suits, claims and actions, either individually or in the aggregate,
are not expected to have a material adverse effect on the Company's
competitive or financial position.  No assurance can be given, however, that
the disposition of one or more of such suits, claims or actions in a
particular reporting period will not be material in relation to the reported
results for such period.

LEASES
Certain items of property, plant and equipment are leased under long-term
operating leases.  Lease expense was $35 million in 1999 ($36 million in
1998 and $45 million in 1997).  Lease commitments at December 31, 1999 were
$57 million.  Leases covering major items contain renewal and/or purchase
options that may be exercised.

ENVIRONMENTAL
The Company is involved in various worldwide environmental improvement
activities resulting from past operations, including designation as a
potentially responsible party (PRP), with others, at various Environmental
Protection Agency-designated Superfund sites.  The Company has recorded
estimated amounts (on an undiscounted basis), which are expected to be
sufficient to satisfy anticipated costs of known remediation requirements
including such costs relating to sold locations.

An analysis of the accrual for environmental remediation costs follows:

<TABLE>
<CAPTION>
                                 1999        1998       1997
                              ----------------------------------

     <S>                         <C>         <C>        <C>
     Balance at January 1        $172        $177       $203
       Accruals                     -           7          -
       Payments                   (10)        (12)       (26)
                              ----------------------------------
     Balance at December 31      $162        $172       $177
                              ==================================
</TABLE>

The balance of the accrual at December 31, 1999 is expected to be spent over
the next 15 to 20 years with the majority to be spent by the year 2005.

Estimated environmental remediation costs are developed after considering,
among other things, the following:

 .    currently available technological solutions
 .    alternative cleanup methods
 .    risk-based assessments of the contamination
 .    estimated proportionate share of remediation costs (if applicable)

The Company may also use external consultants and consider, when available,
estimates by other PRPs and governmental agencies and information regarding
the financial viability of other PRPs.  Based on information currently
available, the Company believes it is unlikely that it will incur
substantial additional costs as a result of failure by other PRPs to satisfy
their responsibilities for remediation costs.


                                 60

<PAGE> 61
13.  CONTINGENT LIABILITIES AND COMMITMENTS - continued
Estimated costs for future environmental compliance and remediation are
necessarily imprecise because of factors such as:

 .    continuing evolution of environmental laws and regulatory requirements
 .    availability and application of technology
 .    identification of presently unknown remediation requirements
 .    cost allocations among PRPs


Furthermore, it is not possible to predict the amount or timing of future
costs of environmental remediation that may subsequently be determined.
Based on information presently available, such future costs are not expected
to have a material adverse effect on the Company's competitive or financial
position.  However, such costs could be material to results of operations in
a future interim or annual reporting period.


14.  CANADIAN REYNOLDS METALS COMPANY, LTD. AND REYNOLDS ALUMINUM COMPANY
     OF CANADA, LTD.
Financial statements for Canadian Reynolds Metals Company, Ltd. and Reynolds
Aluminum Company of Canada, Ltd. have been omitted because certain
securities registered under the Securities Act of 1933, of which these
wholly owned subsidiaries of Reynolds Metals Company (Reynolds) are obligors
(thus subjecting them to reporting requirements under Section 13 or 15(d) of
the Securities Exchange Act of 1934), are fully and unconditionally
guaranteed by Reynolds.  Financial information relating to these companies
is presented herein in accordance with Staff Accounting Bulletin 53 as an
addition to the notes to the consolidated financial statements of Reynolds
Metals Company.  Summarized financial information is as follows:

<TABLE>
<CAPTION>
Canadian Reynolds Metals Company, Ltd.
                                         Years ended December 31
                                    ---------------------------------
                                       1999        1998       1997
                                    ---------------------------------
        <S>                            <C>         <C>        <C>
        Net Sales:
         Customers                     $474        $356       $237
         Parent company                 452         466        680
                                    ---------------------------------
                                        926         822        917
        Cost of products sold           783         708        733
        Net income                     $ 73        $ 84       $117
</TABLE>

<TABLE>
<CAPTION>
                                           December 31
                                    ------------------------
                                       1999           1998
                                    ------------------------
        <S>                           <C>            <C>
        Current assets                $  176         $  155
        Noncurrent assets              1,184          1,206
        Current liabilities             (148)          (100)
        Noncurrent liabilities          (345)          (379)
</TABLE>

<TABLE>
<CAPTION>

Reynolds Aluminum Company of Canada, Ltd.
                                         Years ended December 31
                                  ------------------------------------
                                     1999         1998         1997
                                  ------------------------------------
        <S>                          <C>          <C>         <C>
        Net Sales:
          Customers                  $474         $447        $  519
          Parent company              453          455           648
                                  ------------------------------------
                                      927          902         1,167
        Cost of products sold         784          784           956
        Net income                   $ 73         $ 84        $  117
</TABLE>


                                        61

<PAGE> 62
14.  CANADIAN REYNOLDS METALS COMPANY, LTD. AND REYNOLDS ALUMINUM COMPANY
     OF CANADA, LTD. - continued
Reynolds Aluminum Company of Canada, Ltd. - continued

<TABLE>
<CAPTION>
                                     December 31
                                ---------------------
                                   1999        1998
                                ---------------------
        <S>                       <C>         <C>
        Current assets            $  224      $  186
        Noncurrent assets          1,192       1,228
        Current liabilities         (129)       (103)
        Noncurrent liabilities      (347)       (389)
</TABLE>



                                  62

<PAGE> 63
                   QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)
                      (Millions, except per share amounts)

<TABLE>
<CAPTION>
                                                    1999
-----------------------------------------------------------------------------
Quarter                              1st        2nd       3rd        4th
-----------------------------------------------------------------------------
<S>                               <C>         <C>        <C>       <C>
Revenues                          $ 1,068     $1,161     $1,209    $ 1,358
Gross profit<FN1>                      86        153        164        223
Net income (loss)                 $   (10)    $   35     $   36    $    63
=============================================================================
Earnings Per Share
  Basic:
   Average shares outstanding          64         64         63         63
-----------------------------------------------------------------------------
Net income (loss)                 $ (0.15)    $ 0.55     $ 0.56    $  1.00
-----------------------------------------------------------------------------
  Diluted:
   Average shares outstanding          64         64         63         64
-----------------------------------------------------------------------------
Net income (loss)                 $ (0.15)    $ 0.55     $ 0.56    $  0.99
=============================================================================
Net income (loss) includes the
 effect of the following item:
 Merger-related expenses          $     -     $    -     $    9    $     7
-----------------------------------------------------------------------------

                                                    1998
-----------------------------------------------------------------------------
Quarter                             1st         2nd        3rd       4th
-----------------------------------------------------------------------------
Revenues                          $1,532      $1,579     $1,368    $1,380
Gross profit<FN1>                    211         238        202       182
Income (loss) before
 extraordinary loss and
 cumulative effect of
 accounting change                    58        (123)       262       (45)
Extraordinary loss                     -          (3)       (60)        -
Cumulative effect of
 accounting change                   (23)          -          -         -
-----------------------------------------------------------------------------
Net income (loss)                 $   35      $ (126)    $  202    $  (45)
=============================================================================
Earnings Per Share
  Basic:

   Average shares outstanding         73          72         69        64
   Income (loss) before
    extraordinary loss and
    cumulative effect of
    accounting change             $ 0.78      $(1.70)    $ 3.80    $(0.71)
   Extraordinary loss                  -       (0.04)     (0.88)        -
   Cumulative effect of
    accounting change              (0.32)          -          -         -
-----------------------------------------------------------------------------
Net income (loss)                 $ 0.46      $(1.74)    $ 2.92    $(0.71)
-----------------------------------------------------------------------------
 Diluted:
  Average shares outstanding          74          72         69        64
  Income (loss) before
   extraordinary loss and
   cumulative effect of
   accounting change              $ 0.78      $(1.70)    $ 3.80    $ (0.71)
  Extraordinary loss                   -       (0.04)     (0.88)         -
  Cumulative effect of
   accounting change               (0.32)          -          -          -
-----------------------------------------------------------------------------
Net income (loss)                 $ 0.46      $(1.74)    $ 2.92    $ (0.71)
=============================================================================
Net income (loss) includes the
 effect of the following item:
 Operational restructuring
  effects - net<FN2>              $    -      $ (196)    $  201    $   (95)
-----------------------------------------------------------------------------
<FN>
<FN1>Gross profit equals revenues minus cost of products sold and
depreciation and amortization.
<FN2>Operational restructuring effects are shown net of gains on
sales of assets.
</TABLE>

                                       63

<PAGE> 64
              REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS



Stockholders and Board of Directors
Reynolds Metals Company


We have audited the accompanying consolidated balance sheets of Reynolds
Metals Company as of December 31, 1999 and 1998, and the related consolidated
statements of income, changes in stockholders' equity, and cash flows
for each of the three years in the period ended December 31, 1999.  These
financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation.  We believe that
our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Reynolds
Metals Company at December 31, 1999 and 1998, and the consolidated results
of its operations and its cash flows for each of the three years in the
period ended December 31, 1999, in conformity with accounting principles
generally accepted in the United States.

As discussed in Note 1 to the consolidated financial statements, the Company
changed its method of accounting for the costs of start-up activities in
1998.


                                   ERNST & YOUNG LLP


Richmond, Virginia
February 18, 2000



                                    64

<PAGE> 65
ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

None.


                                  PART III


ITEM 10.   DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

For information required by this item, see the information under the
captions "Item 1.  Election of Directors - Nominees" and "Certain
Relationships" and "Stock Ownership Information - Section 16(a) Beneficial
Ownership Reporting Compliance" in the Registrant's definitive proxy
statement for its 2000 Annual Meeting of Stockholders.  That information is
incorporated in this report by reference.

Information concerning executive officers of the Registrant is shown in Part
I - Item 4A of this report.


ITEM 11.  EXECUTIVE COMPENSATION

For information required by this item, see the information under the
captions "Item 1.  Election of Directors - Compensation of Directors" and
"Executive Compensation" in the Registrant's definitive proxy statement for
its 2000 Annual Meeting of Stockholders.  That information (other than that
appearing under the captions "Executive Compensation - Report of the
Compensation Committee on Executive Compensation" and "Executive
Compensation - Performance Graph") is incorporated in this report by
reference.


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

For information required by this item, see the information under the caption
"Stock Ownership Information - Holders of More Than 5%" and "Director and
Executive Officer Stock Ownership" in the Registrant's definitive proxy
statement for its 2000 Annual Meeting of Stockholders.  That information is
incorporated in this report by reference.


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

For information required by this item, see the information under the
captions "Item 1.  Election of Directors - Certain Relationships" and
"Change in Control and Termination Arrangements" in the Registrant's
definitive proxy statement for its 2000 Annual Meeting of Stockholders.
That information is incorporated in this report by reference.



                                    65

<PAGE> 66
                                   PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)  The consolidated financial statements and exhibits listed below are
     filed as a part of this report.

     (1)  Consolidated Financial Statements:                         Page
                                                                     ----

          Consolidated statement of income -
          Years ended December 31, 1999, 1998 and 1997.               36

          Consolidated balance sheet - December 31, 1999 and 1998.    37

          Consolidated statement of cash flows -
          Years ended December 31, 1999, 1998 and 1997.               38

          Consolidated statement of changes in stockholders' equity -
          Years ended December 31, 1999, 1998 and 1997.               39

          Notes to consolidated financial statements.                 40

          Report of Ernst & Young LLP, Independent Auditors.          64

     (2)  Financial Statement Schedules

          Schedule II - Valuation and Qualifying Accounts -
          Years Ended December 31, 1999, 1998 and 1997.               67

          This report omits all other schedules for which provision is made
          in the applicable accounting regulations of the Securities and
          Exchange Commission because they are not required, are
          inapplicable or the required information has otherwise been given.

          This report omits individual financial statements of Reynolds
          Metals Company because the restricted net assets (as defined in
          Accounting Series Release 302) of all subsidiaries included in the
          consolidated financial statements filed, in the aggregate, do not
          exceed 25% of the consolidated net assets shown in the
          consolidated balance sheet as of December 31, 1999.

          This report omits financial statements of all associated companies
          (20% to 50% owned) because no associated company is individually
          significant.  Summarized financial information of all associated
          companies has been omitted because the associated companies in the
          aggregate are not significant.


                                      66

<PAGE> 67
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
<TABLE>
<CAPTION>
Column A               Column B          Column C          Column D   Column E
------------------------------------------------------------------------------
                                         Additions
                                   ----------------------
                       Balance at  Charged to  Charged to           Balance at
                       beginning   costs and     other                 end of
     Description       of period   expenses     accounts   Deductions  period
------------------------------------------------------------------------------
<S>                       <C>         <C>        <C>       <C>           <C>
Allowance for
 doubtful accounts:
  1999                    $14         $4         $  -      $  (8) (B)    $10
  1998                     16          7            -         (9) (B)     14
  1997                     18          5            -         (7) (B)     16


Allowance for
 deferred income taxes:
  1999                     20          -            -          -          20
  1998                     19          -            1 (A)      -          20
  1997                     46          -            3 (A)    (30) (C)     19
</TABLE>

(A)  Allowance for deferred income taxes is charged to provision for taxes on
     income.

(B)  Deductions consist of the following:

<TABLE>
<CAPTION>
                                           1999       1998       1997
                                         ------------------------------
    <S>                                    <C>        <C>        <C>
    Receivable write-offs                  $(3)       $(6)       $(5)
    Divestitures                            (4)        (3)        (1)
    Foreign currency translation effect     (1)         -         (1)
                                         ------------------------------
                                           $(8)       $(9)       $(7)
</TABLE>

(C)  Deductions were due to divestitures.


                                      67

<PAGE> 68
  (3)    Exhibits

       * EXHIBIT 2     - Agreement and Plan of Merger among Alcoa Inc.,
                         RLM Acquisition Corp. and Reynolds Metals Company
                         dated as of August 18, 1999. (File No. 001-01430,
                         Form 8-K dated August 19, 1999, EXHIBIT 99.1)

         EXHIBIT 3.1   - Restated Certificate of Incorporation, as amended.

       * EXHIBIT 3.2   - By-laws, as amended.  (File No. 001-01430, 1998
                         Form 10-K Report, EXHIBIT 3.2)

         EXHIBIT 4.1   - Restated Certificate of Incorporation.  See
                         EXHIBIT 3.1.

       * EXHIBIT 4.2   - By-laws.  See EXHIBIT 3.2.

       * EXHIBIT 4.3   - Form of Common Stock Certificate.  (Registration
                         Statement No. 333-79203 on Form S-8, dated
                         May 24, 1999, EXHIBIT 4.2)

       * EXHIBIT 4.4   - Indenture dated as of April 1, 1989 (the
                         "Indenture") between Reynolds Metals Company and
                         The Bank of New York, as Trustee, relating to
                         Debt Securities.  (File No. 001-01430, Form 10-Q
                         Report for the Quarter ended March 31, 1989,
                         EXHIBIT 4(c))

       * EXHIBIT 4.5   - Amendment No. 1 dated as of November 1, 1991 to
                         the Indenture.  (File No. 001-01430, 1991
                         Form 10-K Report, EXHIBIT 4.4)

       * EXHIBIT 4.6   - Amended and Restated Rights Agreement dated as
                         of March 8, 1999 (the "Rights Agreement") between
                         Reynolds Metals Company and ChaseMellon
                         Shareholder Services, L.L.C.  (File No. 001-01430,
                         Form 8-K Report dated March 8, 1999, EXHIBIT 4.1)

       * EXHIBIT 4.7   - First Amendment dated August 20, 1999 to the
                         Rights Agreement.  (File No. 001-01430, Form 8-A/A
                         (Amendment No. 2 to Registration Statement on
                         Form 8-A, pertaining to Preferred Stock Purchase
                         Rights) dated August 19, 1999, EXHIBIT 1)

       * EXHIBIT 4.8   - Form of Fixed Rate Medium-Term Note.  (Registration
                         Statement No. 33-30882 on Form S-3, dated August 31,
                         1989, EXHIBIT 4.3)

       * EXHIBIT 4.9   - Form of Floating Rate Medium-Term Note.  (Registration
                         Statement No. 33-30882 on Form S-3, dated August 31,
                         1989, EXHIBIT 4.4)

       * EXHIBIT 4.10  - Form of Book-Entry Fixed Rate Medium-Term Note.
                         (File No. 001-01430, 1991 Form 10-K Report, EXHIBIT
                         4.15)

       * EXHIBIT 4.11  - Form of Book-Entry Floating Rate Medium-Term Note.
                         (File No. 001-01430, 1991 Form 10-K Report, EXHIBIT
                         4.16)

       * EXHIBIT 4.12  - Form of 9% Debenture due August 15, 2003.  (File
                         No. 001-01430, Form 8-K Report dated August 16, 1991,
                         EXHIBIT 4(a))

_______________________
* Incorporated by reference.


                                      68

<PAGE> 69
       * EXHIBIT 4.13  - Articles of Continuance of Societe d'Aluminium
                         Reynolds du Canada, Ltee/Reynolds Aluminum Company
                         of Canada, Ltd. (formerly known as Canadian
                         Reynolds Metals Company, Limited -- Societe
                         Canadienne de Metaux Reynolds, Limitee) ("RACC"),
                         as amended.  (File No. 001-01430, 1995 Form 10-K
                         Report, EXHIBIT 4.13)

       * EXHIBIT 4.14  - By-Laws of RACC, as amended.  (File No. 001-01430,
                         Form 10-Q Report for the Quarter ended March 31,
                         1997, EXHIBIT 4.14)

       * EXHIBIT 4.15  - Articles of Incorporation of Societe Canadienne
                         de Metaux Reynolds, Ltee/Canadian Reynolds Metals
                         Company, Ltd. ("CRM"), as amended.  (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         September 30, 1997, EXHIBIT 4.15)

       * EXHIBIT 4.16  - By-Laws of CRM, as amended.  (File No. 001-01430,
                         Form 10-Q Report for the Quarter ended September 30,
                         1997, EXHIBIT 4.16)

       * EXHIBIT 4.17  - Indenture dated as of April 1, 1993 among RACC,
                         Reynolds Metals Company and The Bank of New York,
                         as Trustee.  (File No. 001-01430, Form 8-K Report
                         dated July 14, 1993, EXHIBIT 4(a))

       * EXHIBIT 4.18  - First Supplemental Indenture, dated as of December 18,
                         1995 among RACC, Reynolds Metals Company, CRM and
                         The Bank of New York, as Trustee.  (File No. 001-
                         01430, 1995 Form 10-K Report, EXHIBIT 4.18)

       * EXHIBIT 4.19  - Form of 6-5/8% Guaranteed Amortizing Note due July 15,
                         2002.  (File No. 001-01430, Form 8-K Report dated
                         July 14, 1993, EXHIBIT 4(d))

         EXHIBIT 9     - None.

      =* EXHIBIT 10.1  - Reynolds Metals Company 1987 Nonqualified Stock Option
                         Plan.  (Registration Statement No. 33-13822 on Form
                         S-8, dated April 28, 1987, EXHIBIT 28.1)

      =* EXHIBIT 10.2  - Reynolds Metals Company 1992 Nonqualified Stock Option
                         Plan.  (Registration Statement No. 33-44400 on Form
                         S-8, dated December 9, 1991, EXHIBIT 28.1)

      =* EXHIBIT 10.3  - Amendment and Restatement of Reynolds Metals Company
                         Performance Incentive Plan, as adopted and executed
                         May 21, 1999. (File No. 001-01430, Form 10-Q Report
                         for the Quarter ended June 30, 1999, EXHIBIT 10.3)

      =* EXHIBIT 10.4  - Amendment and Restatement of Supplemental Death
                         Benefit Plan for Officers, as adopted and executed
                         April 26, 1999.  (File No. 001-01430, Form 10-Q Report
                         for the Quarter ended June 30, 1999, EXHIBIT 10.5)

_______________________
* Incorporated by reference.
= Management contract or compensatory plan or arrangement required to be
  filed as an exhibit pursuant to Item 601 of Regulation S-K.


                                     69

<PAGE> 70
      =* EXHIBIT 10.5  - Financial Counseling Assistance Plan for Officers.
                         (File No. 001-01430, 1987 Form 10-K Report,
                         EXHIBIT 10.11)

      =* EXHIBIT 10.6  - Management Incentive Deferral Plan.  (File No.
                         001-01430, 1987 Form 10-K Report, EXHIBIT 10.12)

      =* EXHIBIT 10.7  - Amendment and Restatement of Deferred Compensation
                         Plan for Outside Directors, as adopted and executed
                         April 28, 1999.  (File No. 001-01430, Form 10-Q Report
                         for the Quarter ended June 30, 1999, EXHIBIT 10.8)

      =* EXHIBIT 10.8  - Form of Indemnification Agreement for Directors and
                         Officers.  (File No. 001-01430, 1998 Form 10-K
                         Report, EXHIBIT 10.9)

      =* EXHIBIT 10.9  - Form of Executive Severance Agreement, as amended,
                         between Reynolds Metals Company and key executive
                         personnel, including each of the individuals listed
                         in Item 4A of this report.  (File No. 001-01430,
                         Form 10-Q Report for the Quarter ended September
                         30, 1999, EXHIBIT 10.9)

      =* EXHIBIT 10.10 - Amendment to Reynolds Metals Company 1987
                         Nonqualified Stock Option Plan effective May 20,
                         1988.  (File No. 001-01430, Form 10-Q Report for
                         the Quarter ended June 30, 1988, EXHIBIT 19(a))

      =* EXHIBIT 10.11 - Amendment to Reynolds Metals Company 1987
                         Nonqualified Stock Option Plan effective October 21,
                         1988.  (File No. 001-01430, Form 10-Q Report for
                         the Quarter ended September 30, 1988, EXHIBIT 19(a))

      =* EXHIBIT 10.12 - Amendment to Reynolds Metals Company 1987
                         Nonqualified Stock Option Plan effective January 1,
                         1987.  (File No. 001-01430, 1988 Form 10-K Report,
                         EXHIBIT 10.22)

      =* EXHIBIT 10.13 - Form of Stock Option and Stock Appreciation Right
                         Agreement, as approved February 16, 1990 by the
                         Compensation Committee of the Company's Board of
                         Directors.  (File No. 001-01430, 1989 Form 10-K
                         Report, EXHIBIT 10.24)

      =* EXHIBIT 10.14 - Amendment to Reynolds Metals Company 1987
                         Nonqualified Stock Option Plan effective
                         January 18, 1991.  (File No. 001-01430, 1990
                         Form 10-K Report, EXHIBIT 10.26)

      =* EXHIBIT 10.15 - Form of Stock Option Agreement, as approved
                         April 22, 1992 by the Compensation Committee of
                         the Company's Board of Directors.  (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         March 31, 1992, EXHIBIT 28(a))

      =* EXHIBIT 10.16 - Amendment and Restatement of Reynolds Metals
                         Company Restricted Stock Plan for Outside Directors,
                         as adopted and executed April 28, 1999 (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         June 30, 1999, EXHIBIT 10.17)
_______________________
* Incorporated by reference.
= Management contract or compensatory plan or arrangement required to be
  filed as an exhibit pursuant to Item 601 of Regulation S-K.


                                  70

<PAGE> 71
      =* EXHIBIT 10.17 - Amendment and Restatement of Reynolds Metals
                         Company New Management Incentive Deferral Plan,
                         as adopted and executed April 28, 1999 (File No.
                         001-01430, Form 10-Q Report for the Quarter
                         ended June 30, 1999, EXHIBIT 10.18)

      =* EXHIBIT 10.18 - Amendment and Restatement of Reynolds Metals
                         Company Salary Deferral Plan for Executives, as
                         adopted and executed April 28, 1999. (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         June 30, 1999, EXHIBIT 10.19)

      =* EXHIBIT 10.19 - Amendment and Restatement of Reynolds Metals
                         Company Supplemental Long-Term Disability Plan
                         for Executives, as adopted and executed April 26,
                         1999.  (File No. 001-01430, Form 10-Q Report
                         for the Quarter ended June 30, 1999, EXHIBIT 10.20)

      =* EXHIBIT 10.20 - Amendment to Reynolds Metals Company 1987
                         Nonqualified Stock Option Plan effective
                         August 19, 1994.  (File No. 001-01430, Form 10-Q
                         Report for the Quarter ended September 30, 1994,
                         EXHIBIT 10.34)

      =* EXHIBIT 10.21 - Amendment to Reynolds Metals Company 1992
                         Nonqualified Stock Option Plan effective August 19,
                         1994.  (File No. 001-01430, Form 10-Q Report for
                         the Quarter ended September 30, 1994, EXHIBIT 10.35)

      =* EXHIBIT 10.22 - Form of Split Dollar Life Insurance Agreement
                         (Trustee Owner, Trustee Pays Premiums).  (File
                         No. 001-01430, Form 10-Q Report for the Quarter
                         ended June 30, 1995, EXHIBIT 10.34)

      =* EXHIBIT 10.23 - Form of Split Dollar Life Insurance Agreement
                         (Trustee Owner, Employee Pays Premium).  (File
                         No. 001-01430, Form 10-Q Report for the Quarter
                         ended June 30, 1995, EXHIBIT 10.35)

      =* EXHIBIT 10.24 - Form of Split Dollar Life Insurance Agreement
                         (Employee Owner, Employee Pays Premium).  (File
                         No. 001-01430, Form 10-Q Report for the Quarter
                         ended June 30, 1995, EXHIBIT 10.36)

      =* EXHIBIT 10.25 - Form of Split Dollar Life Insurance Agreement
                         (Third Party Owner, Third Party Pays Premiums).
                         (File No. 001-01430, Form 10-Q Report for the
                         Quarter ended June 30, 1995, EXHIBIT 10.37)

      =* EXHIBIT 10.26 - Form of Split Dollar Life Insurance Agreement
                         (Third Party Owner, Employee Pays Premiums).
                         (File No. 001-01430, Form 10-Q Report for the
                         Quarter ended June 30, 1995, EXHIBIT 10.38)


      =* EXHIBIT 10.27 - Amendment and Restatement of Reynolds Metals
                         Company 1996 Nonqualified Stock Option Plan, as
                         adopted and executed April 15, 1999.  (File No.
                         001-01430, Form 10-Q Report for the Quarter
                         ended June 30, 1999, EXHIBIT 10.28)

      =* EXHIBIT 10.28 - Amendment to Reynolds Metals Company 1992
                         Nonqualified Stock Option Plan effective
                         January 1, 1993.  (Registration Statement No.
                         333-03947 on Form S-8, dated May 17, 1996,
                         EXHIBIT 99)

------------------
* Incorporated by reference.
= Management contract or compensatory plan or arrangement required to be
  filed as an exhibit pursuant to Item 601 of Regulation S-K.


                                 71

<PAGE> 72
      =* EXHIBIT 10.29 - Form of Stock Option Agreement, as approved
                         May 17, 1996 by the Compensation Committee of the
                         Company's Board of Directors.  (File No. 001-01430,
                         Form 10-Q Report for the Quarter ended June 30,
                         1996, EXHIBIT 10.41)

      =* EXHIBIT 10.30 - Form of Three Party Stock Option Agreement, as
                         approved May 17, 1996 by the Compensation Committee
                         of the Company's Board of Directors.  (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         June 30, 1996, EXHIBIT 10.42)

      =* EXHIBIT 10.31 - Reynolds Metals Company Supplemental Incentive
                         Plan.  (File No. 001-01430, 1996 Form 10-K Report,
                         EXHIBIT 10.40)

      =* EXHIBIT 10.32 - Amendment and Restatement of Reynolds Metals
                         Company Stock Plan for Outside Directors, as
                         adopted and executed April 28, 1999.  (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         June 30, 1999, EXHIBIT 10.34)

      =* EXHIBIT 10.33 - Amendment and Restatement of Reynolds Metals
                         Company Long-Term Performance Share Plan, as
                         adopted and executed April 26, 1999. (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         June 30, 1999, EXHIBIT 10.37)

       * EXHIBIT 10.34 - Asset Purchase Agreement by and among Ball
                         Corporation, Ball Metal Beverage Container Corp.
                         and Reynolds Metals Company dated as of April 22,
                         1998.  (File No. 001-01430, Form 10-Q Report for
                         the Quarter ended June 30, 1998, EXHIBIT 2)

      =* EXHIBIT 10.35 - Reynolds Metals Company 1999 Nonqualified Stock
                         Option Plan (Registration Statement No. 333-79203
                         on Form S-8, dated May 24, 1999, EXHIBIT 4.5)

      =* EXHIBIT 10.36 - Form of Stock Option Agreement, as approved
                         May 21, 1999 by the Compensation Committee of the
                         Company's Board of Directors.  (File No. 001-01430,
                         Form 10-Q Report for the Quarter ended June 30, 1999,
                         EXHIBIT 10.40)

      =* EXHIBIT 10.37 - Form of Three Party Stock Option Agreement, as
                         approved May 21, 1999 by the Compensation Committee
                         of the Company's Board of Directors.  (File No.
                         001-01430, Form 10-Q Report for the Quarter ended
                         June 30, 1999, EXHIBIT 10.41)

         EXHIBIT 11    - Omitted; see Item 8 for computation of earnings
                         per share

         EXHIBIT 12    - Not applicable

         EXHIBIT 13    - Not applicable


         EXHIBIT 16    - Not applicable

----------------
* Incorporated by reference.
= Management contract or compensatory plan or arrangement required to be
  filed as an exhibit pursuant to Item 601 of Regulation S-K.


                                   72

<PAGE> 73
         EXHIBIT 18    - None

         EXHIBIT 21    - List of Subsidiaries of Reynolds Metals Company

         EXHIBIT 22    - None

         EXHIBIT 23    - Consent of Independent Auditors

         EXHIBIT 24    - Powers of Attorney

         EXHIBIT 27    - Financial Data Schedule

       * EXHIBIT 99    - Description of Reynolds Metals Company Capital
                         Stock.  (File No. 001-01430, Form 10-Q Report for
                         the Quarter ended March 31, 1999, EXHIBIT 99)

----------------
*  Incorporated by reference.

   Pursuant to Item 601 of Regulation S-K, certain instruments with respect
   to long-term debt of the Company are omitted because such debt does not
   exceed 10 percent of the total assets of the Company and its subsidiaries
   on a consolidated basis.  The Company agrees to furnish a copy of any
   such instrument to the Commission upon request.


                                   73


<PAGE> 74
(b)  Reports on Form 8-K

     During the fourth quarter of 1999, the Registrant filed with the
     Commission a Current Report on Form 8-K dated October 20, 1999
     reporting under Item 5 that it was filing with the report an unaudited
     pro forma statement of income for the year ended December 31, 1998
     relating to the Registrant's sale of its North American aluminum
     beverage can operations.

     During the first quarter of 2000 (through the date hereof), the
     Registrant has filed three Current Reports on Form 8-K with
     the Commission, all of which reported matters under Item 5:

     .  a Form 8-K dated January 18, 2000, containing unaudited, pro forma
        condensed consolidated financial statements relating to the
        proposed merger of the Registrant with Alcoa Inc.

     .  a Form 8-K dated January 19, 2000, containing information regarding
        the Registrant's 1999 Fourth Quarter and Year-End Results.

     .  a Form 8-K dated February 14, 2000, containing copies of press
        releases issued on February 11, 2000 by the Registrant and Alcoa
        Inc. concerning their proposed merger.



                                     74


<PAGE> 75
                                 SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

                                   REYNOLDS METALS COMPANY



                                   By  JEREMIAH J. SHEEHAN
                                     ------------------------------------
                                       Jeremiah J. Sheehan, Chairman of
                                       the Board and Chief Executive
                                       Officer

                                   Date   March 3, 2000
                                        --------------------------------



     Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.


By WILLIAM E. LEAHEY, JR.             By JEREMIAH J. SHEEHAN
  --------------------------------      ------------------------------
   William E. Leahey, Jr.                Jeremiah J. Sheehan, Director
   Executive Vice President and          Chairman of the Board and
   Chief Financial Officer               Chief Executive Officer
   (Principal Financial Officer)         (Principal Executive Officer)


Date   March 3, 2000                 Date   March 3, 2000
    ------------------------------        ----------------------------



By * Patricia C. Barron               By  * John R. Hall
  --------------------------------      ------------------------------
   Patricia C. Barron, Director          John R. Hall, Director


Date    March 3, 2000                 Date    March 3, 2000
    ------------------------------        ----------------------------



By * Robert L. Hintz                  By  * William H. Joyce
  --------------------------------      ------------------------------
   Robert L. Hintz, Director             William H. Joyce, Director


Date   March 3, 2000                  Date    March 3, 2000
    ------------------------------        ----------------------------



By * Mylle Bell Mangum                By  * D. Larry Moore
  --------------------------------      ------------------------------
  Mylle Bell Mangum, Director            D. Larry Moore, Director


Date   March 3, 2000                  Date   March 3, 2000
    ------------------------------        ----------------------------



                                  75

<PAGE> 76

By RANDOLPH N. REYNOLDS               By
  --------------------------------      ------------------------------
   Randolph N. Reynolds, Director        James M. Ringler, Director


Date    March 3, 2000                 Date
    ------------------------------        ----------------------------



By * Samuel C. Scott, III             By  * Joe B. Wyatt
  --------------------------------      ------------------------------
   Samuel C. Scott, III, Director        Joe B. Wyatt, Director


Date   March 3, 2000                  Date   March 3, 2000
    ------------------------------        ----------------------------



By ALLEN M. EAREHART
  -------------------------------------
   Allen M. Earehart,
   Senior Vice President and Controller
   (Principal Accounting Officer)


Date   March 3, 2000
    -----------------------------------


*By D. MICHAEL JONES
   -------------------------------------
    D. Michael Jones, Attorney-in-Fact


Date   March 3, 2000
    ------------------------------------



                                    76