Alcoa Corporation

Good afternoon and welcome to the Alcoa Corporation fourth quarter 2022 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 phone. To withdraw your question, please press star then two. Please note, this event is being recorded. I would now like to turn the conference over to James Dwyer, Vice President of Investor Relations. Please go ahead.

Thank you. And good day, everyone. I'm joined today by Roy Harvey, Alcoa Corporation President and Chief Executive Officer, and William Opplinger, 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 that are 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. Finally, as previously announced, the earnings release and slide presentation are available on our website. With that, here's Roy.

Thank you, Jim, and thanks to everyone for joining our call today. As you saw from the fourth quarter and full year results that we released today, We returned $572 million in capital to our stockholders through buybacks and dividend payments in 2022. We continue to be well positioned with a strong balance sheet, ending the year with $1.4 billion in cash and proportional net debt of $1.2 billion. In 2022, we also progressed strategic restarts of capacity and worked to mitigate the impact of high energy costs. That said, it was a challenging year. World events influenced costs for raw materials and energy. Our markets saw significant variances in pricing between the first half of the year and the second half, demonstrating once again why we are so focused on reducing complexity and continuing our improvement initiatives. As we progress through this year, we will continue to act to drive operational and commercial excellence, disciplined execution, and rigorous cost management. Before we get into more details, though, I want to emphasize, as always, our most important priority, safety. We strive to protect the safety and health of those who work at our facilities or visit them. In 2022, we did not have any workplace fatalities. This, however, is not an achievement. It is simply an expectation. And we always have areas where we can and will improve. We recognize that maintaining a fatality-free workplace requires constant vigilance to identify and eliminate critical risks. In fact, every employee at Alcoa has the authority and my permission to stop a job and seek help if they are unsure if it's safe to proceed. There's never any production goal that will take priority over safety. Now, on to our financial results. In the fourth quarter, we had a net loss of $374 million and $29 million in adjusted EBITDA. For full year 2022, we had a net loss of $102 million and adjusted EBITDA of $2.2 billion. It is clear from our fourth quarter results that we are confronting a challenging market and operational situation, and we are taking action to be sure that we are firmly focused on driving improvements across our operations and company. Bill, who will become our Chief Operating Officer on February 1st, will provide the full detail on our financial results in just a moment. Incidentally, this will be Bill's last earnings call as our Chief Financial Officer. Molly Bierman, our current Senior Vice President and Controller, is being promoted to CFO. She has tremendous financial experience and has been a strong leader for Alcoa. She'll join me for our earnings calls beginning in April, as she takes over Bill's former role and he takes his skill and experience to operations. Now, turning to some operational highlights. Last year, we advanced several restarts that will bring economic value to the business. We also acted swiftly to reduce production capacity when and where conditions warranted. Last month, we completed the safe restart at our Portland Aluminum Joint Venture smelter in the state of Victoria in Australia. and we continued to advance the restart of the Alumar smelter in Brazil. To mitigate the rising costs of gas and electricity, we reduced output at the San Ciprian alumina refinery in Spain and curtailed one-third of production at our Lista aluminum smelter in Norway. Separately, over these last couple weeks, we adjusted production at the smallest of our three refineries in Western Australia due to natural gas shortages that continue to persist in the region. We have a strong foundation across this company with the know-how and expertise to drive continued improvement. We are ready to address short-term challenges while remaining focused on our future, one where aluminum will become even more important as the world works to decarbonize. As we progress into the year, it's also worth reinforcing the work we are doing on our ESG objectives. Alcoa has a clear purpose and a vision that guides our actions and decision-making. We are producing and delivering products that support our customers' own sustainability ambitions, and we are creating shared value for our communities and our other stakeholders. Just recently, in fact, we were once again named a top-tier industry producer by the Dow Jones Sustainability Indices. We also continue to pursue growth opportunities via projects that can creep our production, and we're excited about the progressing development of our transformative technologies, which align fully with our vision to reinvent the aluminum industry for a sustainable future. So with that, let's dive into the numbers. Bill, please go ahead.