Acerinox Sa

Good morning, ladies and gentlemen, and welcome to the Theranos fourth quarter and full year conference call. The year 2024 was a very important and transformational year for the group. As we will comment during this presentation, we continue to address our strategy moving to high added value materials and focusing on our core markets. The acquisition of Heinz International, the new production model implemented at Acerinos Europa, and the sale of Barrio Stainless have been important milestones that have occurred during this year. To discuss these topics and many more, we have here today our CEO, Bernardo Velazquez, our CCO, Miguel Fernandez, and for the first time in a full year presentation, the newly appointed CFO, Esther Camos. Before getting started, let me remind you that this conference call is being broadcast on our website, atherinos.com, on which you can also find the audited annual accounts and management report, which also includes the statement of non-financial information. Without further ado, I would like to hand the floor over to our CEO. Bernardo, please go ahead.

Thank you, Carlos. Good morning, everybody, and thank you for attending to this results presentation. One year more, we are here to speak about last year's results, how do we see the situation today, how do we see the situation for 2025, and what are we doing, what is the strategy, and how is Athena's position for all these changes, because many things are happening in this world. Many things happened in 2024, still changing in 2025. We can speak about, you know, 2024, wait and see. A year, everybody waiting for the European, the American elections, waiting for the new European Commission. Still, we are waiting for the new German government and still waiting for the reaction of the market that will come sooner or later. And many things have also happened in Acerinox. Many things started for fulfilling our strategy. We sold Varu Stainless with a lot of pain for us, but it was impossible to compete with other rules of the game with the Asian players. We are going to dedicate our efforts to our main markets. Starting with Europe, we are changing our business model. That cost us, as you perfectly know, five years of strike, but we are successfully changing the business model, changing to the new strategy, and going ahead with our strategy. And it's the year of Haines. It's the year of Haines where we are reinforcing the strategy that we started in 2019 with the acquisition of BDM. And thanks to the success of the BDM acquisition and thanks to our clear idea of what is the future for our industry and with our clear strategy, we decided to head with this project that is going to be transformational for our company.

when we talk about 2024, Clearly, the main definition we are using is a transformational year. If we were purely talking about business as usual, it should have been also an excellent year to commence and a year to be proud about. In the map, you are seeing all of our companies in these days. If we should start from the west to the east, we could talk about the breakdown very taking results of North American stainless in a difficult environment with three years of contraction in the states. And the results have been amazing. If we think of BDM, it's true that we had wins on the nickel market, but BDM has been taking records on a monthly basis in conversion margin. When we look at Columbus in South Africa, it's true that a big effort and a big work for improving the position of Columbus in the market and flexibility bringing new products. There are a lot of things on our business as usual to talk about, but the main slide today, obviously, is the transformational that is coming from these three milestones that Bernardo has mentioned. In this regard, If we start from the east to the west and try to value which has been the effect, the economical effect in our accounts of these three milestones, starting from the east, obviously the sale of Baro, as Bernardo mentioned, we informed that the sale of Baro was taking place at 95 million U.S. dollars. This is something that we have been disclosing in the last year. Baru was not core business anymore, but we prioritized to find the most suitable way for our stakeholders, mostly for our workforce, for keeping our operations and keeping the plant running. On this basis, finally, the decision was this sale, selling at 95 million US dollars. After last year, exercises of making impairments at various assets, at the end, this sale at 95 million dollars has created a higher effect and a higher income in our P&L in this year. So the effect has been 146 million euros in the year. And as I say, as a consequence of all the previous impairments that previously were taking place, and as a consequence that the sale also has occurred in 2024 at a stronger dollar-euro exchange rate, much more stronger than that one of the historical investment we made on Baru from the year 2009. So consequently, this has made a big contribution of 146 million euros in the year, and this compensates some of the areas that have had a negative impact in our results of the year. Obviously, the effect of putting in place the new business model for Atherinos Europa, as Bernardo mentioned, created tensions with the unions and we have been experiencing a five-month strike But it was very important that this business model was implemented. So obviously it has been painful experiencing such a strike, especially for our people in the area. But what's fortunate is that finally the business model has been implemented. This business model shall make the turnaround of the plant in Campo de Gibraltar for a year. profitable performance, even in hard times as the actual ones, but the bill that we have to pay as a consequence of the strike has had an effect of 84 million euros. When we made the first semester results, we talk about estimation that the strike in our accounts have created an impact of 43 million euros. This has been the direct loss appearing in our accounts. In addition, The losing possibilities, the losing orders, has created additional effect of around 40. So because of that, what we more or less quantify, the impact of that strike has been 84 million euros. Fortunately, now the situation is solved, and then we have this wage agreement working in place until end of 2027. As part of that wage agreement implementation, it has been agreed that our rejuvenation plan, and we already more or less have registered for it and included in accounts a provision for that plan which amounts to 12 million euros. So this is more or less at the end what appears as a consequence of the effects and the tensions taking place in the year. Fortunately, now they are solved. And then moving more to the west, it is clear that the acquisition of Heinz has been a great milestone. We have talked a lot about this in the last year since the 5th of February when we announced the deal. It has taken longer than expected because of several of the antitrust allowances that need to be obtained. Finally, it took place in December. Much more later than what we have preferred, but any case, since December, we incorporated Hanes in our figures. And as a consequence of that, the final valuation was the same that was announced at the very beginning. We have absorbed 51 million euros of debt of Haines, and also we have registered at the end of the year all the expenses incurred for the transaction, which have been valued at 21 million euros. So all this more or less has been the bills we have... needed to pay, most of them recorded at the end of the year, for the three milestones that create this year for being the transformational year in the Atherinos Group.