Alcoa Corporation

Good afternoon, everyone, and welcome to the Alcoa Corporation fourth quarter and full year 2018 earnings presentation and conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your touchtone phone, and to withdraw your question, please press star, then two. And please note that today's event is being recorded. And I would now like to turn the conference over to James Dwyer, Vice President of Investor Relations. Please go ahead.

Thank you, William. And good day, everyone. I'm joined today by Roy Harvey, Alcoa Corporation President and Chief Executive Officer, and William Oblinger, Executive Vice President and Chief Financial Officer. We will take your questions after comments by Roy and Bill. As a reminder, today's discussion will contain forward-looking statements relating to future events and expectations subject to various assumptions and caveats. Factors that may cause the company's actual results to differ materially from these statements are included in today's presentation and in our SEC filings. In addition, we have included some non-GAAP financial measures in this presentation. Reconciliations to the most directly comparable GAAP financial measures can be found in the appendix to today's presentation. Any reference in our discussion today to EBITDA means adjusted EBITDA. Also, a note on our financial statements. Consistent with our three previous 2018 earnings presentations, all comparative prior periods have been updated in accordance with the Financial Accounting Standard Board's recent change to the presentation of non-service pension and OPEB costs. This change resulted in ALCOA moving such costs out of EBITDA and into other income expense. Finally, as previously announced, The earnings release and slide presentation are available on our website. With that, I'll turn it over to Roy.

Thank you, Jim, and thank you to everyone for joining today's earnings call. Our fourth quarter and full year 2018 results reflect our determination to accelerate the strengthening of Alcoa. Despite sequentially weaker markets, we had a strong fourth quarter with higher profits in our bauxite and aluminum business units. And with the help of higher market prices earlier in the year, we increased annual profits, addressed liabilities, significantly strengthened our balance sheet, and began to return cash to stockholders. We've built upon the progress we've made since our launch, and by executing our strategic priorities to reduce complexity, drive returns, and strengthen the balance sheet, we're better positioned to thrive through market cycles. But as we turn to 2019, Markets have trended lower, and there's increased uncertainty surrounding global trade. This has created a dynamic environment for input pricing and product pricing. Our businesses, however, are ready for these challenges, and we're determined to drive improved operations, react smartly and with urgency to changing market conditions, and to further strengthen our company's foundations. With that, let's get started with an overview of the fourth quarter. We reported net income of $43 million, or 23 cents a share. On an adjusted basis, excluding special items, net income was $125 million, or 66 cents a share. On an adjusted EBITDA basis, excluding special items, we generated $749 million and reported solid cash generation. Turning to our businesses and beginning with safety, the fourth quarter was free of serious injuries. We're very happy with this achievement and we look forward to building upon it as the year progresses. Operationally, in Illumina, our Pinjera refinery in Western Australia, one of the largest in the world, attained a fourth quarter production record. Our Illumina segment also reported a rise in quarterly profits. In aluminum, last month we curtailed half of the one operating pot line at the Beconcourt smelter in Quebec, Canada. This will enable our salaried employees to continue to run this portion of the line safely with a smaller workforce. Meanwhile, we continue to work on reaching a new labor contract with the unionized workforce. Also this quarter, we began to buy back shares under the stock repurchase program announced in the third quarter. and we successfully amended our revolving credit agreement reflecting our improving financial profile. Lastly, overnight in Spain, we reached a tentative agreement with the workers' representatives at our Adeles and Aquaruna aluminum plants related to the collective dismissal process that we announced in October. The workforce is expected to vote on the tentative plan by the end of the month. The plan calls for the curtailment of the smelters at both plants The casthouses at each plant will remain in operation and the paste plant at Aquaruna will continue to operate. A social plan included in the tentative agreement preserves a portion of the jobs of the two facilities and includes retirement packages and potential relocation to our San Ciprian facility. Taking a broader look at 2018, as I mentioned earlier, we can see a strengthening Alcoa and it's visible across safety, our balance sheet, and our financial performance. Compared to 2017, we grew revenue and net income, and we increased adjusted EBITDA, excluding special items, by 27%, reaching $3.1 billion. We reduced our pension and OPEB net liabilities by a third, enhancing our balance sheet, all while maintaining a healthy cash balance. In safety, we experienced three serious injuries in 2018, but we were grateful to have no fatalities last year. Our focus across the year has been to revitalize our safety program, and we look to improve safety further this year and beyond. Despite operational issues earlier in the year, we saw annual production records at two of our aluminum plants and two of our bauxite mines. We completed the partial restart of our Warwick smelter to support profitably growing our canned sheet business, and we launched a joint venture to develop our carbon-free aluminum smelting technology. We're proud of what we've accomplished in 2018 and how this work has positioned us for the coming years. Furthermore, with two years of actual results now behind us, and given industry practice and market volatility, We're amending the way that we provide annual outlook information to more fully describe business drivers rather than point-in-time estimates. Bill will offer more details on this change. With that, I'll turn it over to Bill for a detailed review of fourth quarter results.