Befesa S.A.

Good morning and welcome to the preliminary full year 2024 results conference call of VEFESA. I am Rafael Perez, CFO of VEFESA. This morning I am joined by our group CEO, Asier Zarraonandia. Asier will start with an executive summary of the period and then he will cover the business highlights of the steel dust as well as aluminum salt slag recycling business. I will then review the financials by business and will cover the evolution of commodity prices, our hedging program. And finally, cash flow, net debt, and capital allocation. Asier will close this presentation providing an update on the outlook for 2025 and an update of our growth plan. Finally, we will open the lines for the Q&A session. Before getting started, let me remind you that this conference call is being webcasted live. You can find the link to the webcast preliminary full year 2024 results presentation on our website, www.befesa.com. Now, let me turn this call over to our CEO. Asiel, please.

Thank you, Rafa. Moving to page five of the business highlights. The FESA has delivered a strong four-quarter and four-year results despite a challenging macroeconomic environment, which demonstrates the resiliency of our business model. Total adjusted BDA in the four-quarter has been 62 million euros, up 27% compared to the previous quarter and making a record level for quarterly results, reflecting a strong year-on-year performance. For the full year, adjusted VDA reached €213 million, an increase of 17% compared to the previous year. Operating cash flows have increased by 30% year-on-year, even by a strong cash conversion. Leverage at year end reached 2.9 times below our initial target of 3 times. We have delivered solid performance during the year with solid steel dust volume in our two main markets, Europe and the U.S., despite the challenge that the steel sector is suffering. In our aluminum business, we have delivered strong performance in our salt slag recycling business leaving the Hannover plant back to full operations and a strong volume received from our customers. On the other hand, our secondary aluminium business has been impacted by a challenging automotive industry in Europe. I will elaborate later on all these aspects. On outlook, we expect 2025 to be another year of strong earnings, strong energy growth and further deliberation during the year. We are adjusting our business plan and capital allocation to focus on reducing the leverage and investing in ongoing approved expansion projects. As such, the expansion plan in China is stopped due to the current market conditions. Our growth capex will focus on finishing the refurbishment of Palmerton and expansion of Bermuda, both low-risk projects from execution, technology, and commercial point of view. Moving on to page six. Overall, our steel dust recycling business has delivered strong results in 2024 in Europe and the US. In Europe, the steel sector is going through a challenging period, with steel production in Europe at the five-year low levels, impacted by weak demand. In Europe, despite this challenging environment, the level of steel dust deliveries from our EAF steel customers is stable and solid. and we continue to run our plants at a very high capacity utilization with an average of 92%. In the US, in the steel dust recycling business, we are running the plants at good levels of utilization, similar to previous quarters, around 70%. The measures that we have been taking and best practices that we have been applying to improve the recycling operations are on track and delivering good results, achieving higher BDA per ton gradually. The zinc refining plan in the U.S. is in final stage of the ramp-up and turnaround process with a strong focus on cost reductions. In 2024, the unfavorable combination of PCs and premiums for special high-grade zinc produced around 15 million negative contributions. In our ASEAN operation, we have delivered robust Q4 in Turkey and South Korea, reaching a strong level of utilization. Our Chinese plants continue running at the utilization level of 50% impacted by weak electric car furnace steel production. Moving on to page 7, business highlights for the aluminum salt slag recycling business. In the aluminum business, we have delivered a strong volume of salt slag recycling, which has been partially upset by weak secondary aluminum results. On salt slugs, the strong volume has resulted in a very high capacity utilization of the plants, driven by the Hannover plant in Germany back to operations at full capacity. This strong operating results has been partially upset by lower FBM aluminum price. On the other hand, our secondary aluminum segment has been suffering during the whole year from a very weak European automotive industry, which is affecting the demand of secondary aluminum. This is putting a lot of pressure in the aluminum metal margin, which is suffering compression compared to the levels of last year, caused by weak demand of secondary aluminum, coupled with difficult access to aluminum scrap in the market. Now, Rafael will explain the financials in more detail.

Thank you, Asier.