Ladies and gentlemen, thank you for standing by. Welcome, and thank you for joining the preliminary full year 2022 results of Befesa. Throughout today's recorded presentation, all participants will be in a listen only mode. After a short introduction by the management, there will be a question and answer session. If you would like to ask a question, you may press star followed by one on your touchtone telephone. Please press the star key followed by 0 for operator assistance. I would now like to turn the conference over to Rafael Pérez, Investor Relations and Strategy Director. Please go ahead. Good morning, and welcome to the preliminary full year 2022 results conference call of Befesa. I am Rafael Pérez, Head of Strategy and Investor Relations of Befesa. Today, we have with us Javier Molina, Executive Chair of Befesa, Asier Zarraonandia, CEO of Befesa, and Wolf Lehmann, CFO of the company. Javier Molina will start with an executive summary of 2022. After that, Asier will explain the business highlights of the period covering steel dust and aluminium salt slag recycling. Wolf will review the financials in total and by business unit, as well as cash flow as an update on our hedging program. Javier will close the presentation, providing some thoughts about the outlook for 2023 and the new five-year growth plan. Finally, we will open the line 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 and the preliminary full year results presentation on our website, www.befesa.com. Now, let me turn this call over to our Chairman. Javier, please. Thank you, Rafael. Good morning. In 2022, we have achieved record levels of revenue, EBITDA, net profit, and operating cash flow, mainly driven by the positive contribution of the US operations, as well as higher metal prices, which have been partially compensated by much higher inflation. Despite these record results, 2022 has been a very challenging year for Befesa, impacted by very high general inflation, especially energy prices, weak economic environment, and a difficult COVID situation in China. Until Q3, we were able to compensate all the inflation and increasing energy price with higher commodity prices. The last quarter of the year has been more challenging than what we originally expected. As a result, we have closed the year with unadjusted EBITDA of EUR 215 million. The main reason for this result in the last quarter has been high energy prices, especially coke, which account for about 50% of the total energy cost in Befesa, as well as lower zinc price and weak steel production in the markets where we operate. As a reference, steel production has decreased in the last quarter of 2022 by 18% in Europe, 24 in Turkey, 12 in South Korea, and 11% in North America on a year-on-year basis. Our aluminum business has performed well, and despite the high energy price, we have been able to transfer a big part of this increase to the market. As such, aluminum has delivered an strong year in this challenging environment. Total revenues have been EUR 1.1 billion, up 38% compared to the previous year. Adjusted EBITDA has been at EUR 215 million, up 9% compared to 2021. Net profit, EUR 106 million, up 6% equal to EUR 2.66 per share. In North America, the integration is progressing well, the execution is according to plan. We are working in the integration of the zinc refining business, which we acquired in September last year. As we explained, the zinc refining business provides Befesa with a strategic vertical integration opportunity in the U.S., addressing the shortage of smelting capacity in the North American market. Furthermore, the refining facility is the only one of its kind in the world, producing green zinc for 100% recycled raw materials. In China, the plant in Henan is completed. The plant in Henan completed its commissioning in December, we are ramping up operations. Today, we have two plants completed and ready to operate as soon as the market shows signs of recovery from COVID post-Chinese New Year. Both Asier and I were able to travel to China last week for the first time in almost three years. We had the opportunity to meet with existing and potential customer, as well as local authorities in the province where we have operations. In Henan, we carried out the official opening ceremony of the plant with representatives of government. We signed the investment agreement with the government, where the third plant will be located in the province of Guangdong as part of our five-year growth plan. In the trip, we could see in person that the country is really opening and going back to a more normal post-COVID environment, which make us be confident about the positive development of China. Today, we have the two plants in Jiangsu and Henan fully ready to operate in 2023. Although it is early to say how the year will progress, we are confident about the positive developing. As explained at our Capital Markets Day, we are already executing our five-year growth plan. We are working on the refurbishment of the U.S. plant in Palmerton, as well as the third province in China at Guangdong. On dividend, we will propose a dividend of EUR 50 million for 2022, which is stable compared to the previous year and equivalent to EUR 1.25 per share, close to 50% of net profit. On the ESG side for our year, we have been able to reduce our lost time injury rate by 32% year-on-year to new lowest level. We are executing our CO2 reduction plan about we will provide more details in the next ESG report that we will publish in June. Javier will explain the business performance in more detail. Thank you, Javier. Good morning to all. I will provide an overview of the performance of the business during Q4 and the full year 2022. Overall, Q4 has been a challenging quarter as explained by Javier, impacted by high general inflation, high coke prices, weak steel production across all markets, and a difficult COVID situation in China. For the steel dust, in the full year 2022, total steel dust throughput was up by 35%, reaching 1,194,000 tons, driven by contribution of the recycling plants in the U.S. In the Q4, the steel dust throughput has been up by 11% compared to Q3, driven by less maintenance shutdowns than in the Q3, as we used to remark. Steel dust throughput in Q4 was slightly lower than expected and down by 8% compared to last year, driven by lower steel production in the markets where we operate. In Turkey, where we have a plant in the Iskenderun region, as you all know, two terrible earthquakes took place on the sixth of February. We are grateful that none of our employees and contractors were injured. The humanitarian situation is really dramatic, with many people lives lost and many houses ruined, and with utility problems which affect to the less damaged houses and industries. The earthquake's impact of the region around the plant has been severe. The full recovery of the area will take time, there are now some industry coming back to work gradually, among them some steelmakers in that area. At the time of the earthquake, the plant was temporarily shut down for a scheduled maintenance work. Assessment shows that the plant has only received minor damages. We are now receiving dust at the premises and planning to restart the operation during March. From the price point of view, blended zinc price, considering the weighted average of the LME and hedging, has increased 15% in the full year. LME price decreased by 9% in the Q4 compared to the Q3. blended zinc price in Q4 went up by 9%. These positive effects of volume and prices have been partially offset by high inflation across the business in the full year, mainly in energy prices and more specifically coke, which today represents about 50% of the total energy cost in Preinsa. Total EBITDA in the steel dust business has been EUR 169 million in the full year, up 14% compared to the previous year. In the Q4, EBITDA in the steel business has been down by 18% as a consequence of higher coke price and lower volume of steel dust. In the U.S., the integration of the asset R into Preinsa is developing well across all fronts. The team is working well, and we are delivering the results that we expected. The refining facility, which we acquired last September, is also being integrated into Preinsa. The plant is still in ramp up mode, and we expect positive EBITDA contribution in 2023. In the U.S., we are working on the efficiency projects that will drive synergies to be captured in 2023. At the same time, we are preparing the Palmerton plant for the refurbishment to free up capacity and be able to capture the future growth in the market. In China, the Chinese government has completely changed its strategy to fight against COVID. Since Q4 last year, we have been suffering from the zero-COVID strategy, which created a very challenging environment to operate. Because of that, at Jiangsu province, we have not been able to operate the plant properly in the Q4, as the COVID zero made the Chinese economy to slow down, impacted the steel production and our utilization rate. Our second plant in the province of Henan is completed, and commissioning of the plant was finished in December last year. As Javier has explained, we were in China last week for the first time after three years. We had the opportunity to meet with the team, the authorities, and customers. We are optimistic about how the country is developing. In the traditional business of Preinsa, we are achieving good volumes. Although Q4 has been a very weak quarter from the steel production point of view. Driven mostly by our stocking effort, we have started Q1 seeing healthy levels of production through the markets, which will support our utilization levels. Moving now to our aluminum salt slag and secondary aluminum business. Our aluminum business has delivered another good quarter in a very challenging macroeconomic environment, which is quite remarkable. In the full year 2022, we have recycled 322,000 tons of salt slag, representing an 18% decrease compared to last year, driven by the temporary shutdown of the plant in Hanover, which under repaired after the fire last year. Normalizing for this one-off operating effort, the volume of salt slag will be 7% up year-on-year. Within the Q4, the volume of salt slag has been down by 11% or up 3% on a normalized base. The production of secondary aluminium alloys in the full year 2022 has been 161,000 tons, a decrease of 14 over last year, also impacted by the shutdown of the Hanover plant. The plant has been fully refurbishment, and we are now in the ramping up of operations. From the prices point of view, the aluminium price has increased 15% in the year, although in the Q4, the price of aluminium has decreased by 8% compared to the previous year. The high inflation of energy has had a total impact of more than EUR 26 million in the year, the majority of which we have been able to pass to our customers via increase of prices, collection fee, and margin. As a result, in the aluminium business, we have achieved a total EBITDA of EUR 46 million, down 6% compared to last year. In the Q4, total EBITDA has been EUR 12 million, down 20% versus last year. All in all, a very challenging quarter and end of the year impacted by market conditions and a challenging environment. Now, Wolf will explain the financially more detail. Thank you, Asier. Please turn to page eight, the full year 2022 consolidated financial highlights. As mentioned by Javier, Befesa delivered a record adjusted EBITDA of EUR 214.6 million, up EUR 17 million or 9% year-over-year versus full year 2021 at EUR 197.6 million. Please note that not on an adjusted, but on a reported basis, EBITDA was higher and amounted to EUR 234.9 million, +24% year-over-year, largely attributable to the positive accounting effect from the US Zinc refining acquisition, which we normalized for when showing adjusted EBITDA. On the year-over-year adjusted EBITDA walk, the EUR 17 million improvement was mainly driven by our US Zinc operations contributing during the full year for the first time in 2022. Downward pressure was due to unfavorable zinc treatment charges, TC, and energy inflation, which offset the benefits of year-over-year higher base metal prices. Reviewing the main drivers of the year-over-year EUR 17 million EBITDA improvement in more detail. On volume, overall, approximately EUR 23 million net positive volume year-over-year impact, as explained by Asier, mainly coming from the contribution of the US Zinc operations. On price, the overall approximately EUR 39 million positive price year-over-year impact was about one-third or EUR 12 million from steel dust business and two-third or around EUR 27 million from our aluminum salt slag business. I will explain in more detail on the following pages. On cost other, the approximately EUR 45 million cost other lever reflects mainly the higher inflation, primarily energy costs, which offset the year-over-year higher metal prices. In summary, adjusted EBITDA is at an all-time high of EUR 215 million with a solid 19% adjusted EBITDA margin even during these high inflationary times and while the US Zinc integration is ongoing. Total revenue increased by EUR 314 million or 38% year-over-year to EUR 1.136 billion, a new record level, compared to adjusted EBITDA increase of 9%. Consequently, EBITDA as a percent of sales stands at 19% versus 24% last year. The percent profitability decrease is mainly driven, as explained, by the record high inflation of around EUR 45 million, as well as the unfavorable zinc treatment charge increase by around EUR 60 million. Net profit increased by EUR six and a half million or 6.5% year-over-year to EUR 106.2 million in full year 2022, also a new record and equal to EUR 2.66 earnings per share. Cash stands at EUR 162 million, and net leverage increased to 2.56, which I will explain later together with net debt and net leverage performance on page 11. This is after self-funding over EUR 50 million for the US Zinc refining asset and related acquisition costs. Please note, as various financial and operational data tables with quarterly, annual, and multi-year views for your record. Turning to page 9, the steel dust recycling services results. Steel dust recycling services continued to perform strongly and delivered EUR 169 million adjusted EBITDA in full year 2022, up EUR 20 million or 14% year-over-year. Overall, the EUR 20 million year-over-year EBITDA improvement was mainly driven by the US Zinc operations contributing for the full year in 2022. Downward pressure was due to unfavorable zinc treatment charges and energy inflation, which offsets the benefits of year-over-year higher base metal prices. The volume lever was positive by around EUR 28 million EBITDA year-over-year impact, as explained, mainly driven by the contribution from the US operations for the full year. The net price lever was positive by about EUR 12 million, with main price components being positive EUR 23 million, higher zinc LME prices, which were up 30% year-over-year to around EUR 3,300 per ton on average. Also positive, EUR 5 million higher zinc hedging prices, up 11% year-over-year to around EUR 2,380 per ton on average in the full year 2022. Negative EUR 16 million, driven by the higher annual zinc treatment charges, which were set at $230 per ton versus $159 per ton in the prior year. Overall, the approximately EUR 12 million year-over-year positive impact from the price lever was offset by approximately EUR 20 million year-over-year negative impact from the higher inflation, mainly energy cost, captured under the cost other lever. Revenue in the steel dust recycling business increased by EUR 275 million or 60% year-over-year to EUR 730 million, compared to adjusted EBITDA increase by 14% year-over-year. Consequently, EBITDA as a percent of sales stands at 23% rather than 33% last year. The% profitability decrease is mainly driven, as explained, by the record high inflation of around EUR 20 million, the unfavorable zinc TC increase by around EUR 16 million, as well as the zinc refining acquisition contributing to sales, but not yet to EBITDA in Q4. Going now to page 10, the results of our aluminum salt slags recycling services segment. Aluminum salt slags recycling services delivered a strong EUR 46 million adjusted EBITDA in full year 2022. This was down EUR 2.8 million year-over-year when compared to the all-time high of EUR 48.8 million EBITDA reached in 2021. The year-over-year EBITDA development was mainly impacted by the lower market activity in the European automotive and aluminum industries. The higher energy prices were successfully offset by the achieved higher metal prices. The volume level was down by about EUR 5 million EBITDA year-over-year. As explained by Asier, this was primarily due to the Hanover plant being out of operation for the full year. The price level was positive, about EUR 27 million, with aluminum alloy Metal Bulletin market prices showing a 15% year-over-year improvement or a full EUR 327 per ton increase, as well as better aluminum metal margins. The cost other lever, with around EUR 25 million negative impact year-over-year, was driven by the higher inflation energy cost trends, with particularly high gas prices in Europe, thus offsetting most of the progress in price. Turning to page 11, the cash flow, net debt, and leverage results. On the EBITDA to cash flow bridge, starting with EUR 214.6 million adjusted EBITDA on the left and walking to the right. Working capital was up by about EUR 34 million year-over-year. The higher working capital consumption was very much to fund growth, including adjusted items related to the US zinc refining acquisition. In addition, after collecting the majority of the Hanover insurance coverage, there are approximately EUR 10 million expected to be collected during first half 2023. Interest at EUR 21.2 million as expected, which equals to approximately 3% of the EUR 711 million gross debt at year-end 2022. Taxes at EUR 21.9 million, also as expected, which equals to approximately 17% of the EUR 113 million gross profit achieved in 2022, resulting in an operating cash flow of EUR 137.3 million in full year 2022, up 16% year-over-year, also a new record. The operating cash flow to EBITDA ratio amounts to approximately 65%, in line with the strong last three years average ratio. CapEx-wise, in the year 2022, we spent EUR 79.6 million regular maintenance CapEx, as well as CapEx related to operational excellence, synergy projects in the US, and to the recovery of our Hanover plant, where we partially got already and are getting the money back from the insurance. Normalizing for Hanover recovery and US operational excellence CapEx, the regular maintenance CapEx amounts to roughly EUR 40 million in the year. Growth CapEx of EUR 71.8 million, including the majority or $47 million for the acquisition of the US zinc refining operations, as well as our new plant at Henan in China. Dividends, EUR 50 million or EUR 1.25 per share, were distributed in July, equal to 50% of net profit of the prior year, 2021, as promised. As mentioned by Javier, Befesa is proposing a stable EUR 50 million dividend, EUR 1.25 per share, again for 2023, equal again to approximately 50% of net profit. Total cash flow amounted to negative EUR 62 million, and cash on hand stands at EUR 162 million. Normalizing for over EUR 50 million to self-fund the US Zinc refining acquisition and related cost and about EUR 10 million of Hanover insurance in process, we ended the year with a balanced cash flow. The cash on hand of EUR 162 million, together with our entirely undrawn EUR 75 million revolving credit line, provides Befesa with a strong liquidity of about EUR 230 million. The EUR 549 million net debt, with the EUR 250 million adjusted EBITDA, results in a 2.56x net leverage at year-end closing, again, after self-funding the US Zinc refining acquisition. Turning to page 12 on hedging. Our zinc hedge book is up to and including July 2025. That's approximately two and a half years of hedges on the books. Our hedging strategy remains unchanged. Overall, considering the combined global hedge book, Europe, Korea, and US operations, the year 2022 was hedged at EUR 2,379 per ton on average. The year 2023 is at around EUR 2,450 per ton or $2,650 per ton. The next year thereafter, the year 2024, at around EUR 2,550 per ton or $2,750 per ton. The first half of 2025 is at around EUR 2,650 per ton or $2,900 per ton, sold forward prices. We used an updated and estimated FX dollar to euro of 1.08 for 2023 and 2024, and around 1.10 for 2025. Summarizing the financial section before we turn to the growth, three points. One, Befesa delivered in 2022, record financial results with more than EUR 1.1 billion revenue and EUR 250 million adjusted EBITDA, above EUR 100 million net profit, as well as about EUR 137 million operating cash flow, all on record levels despite the current volatile market environment. Two, our financial backbone is strong. Our hedge book covers up to and including July 2025. Our capital structure is efficient and long-term. After self-funding around EUR 50 million for the zinc refining acquisition in the US and related cost, liquidity is more than EUR 230 million. Three, this financial backbone supports us well to self-fund our growth roadmap, our latest Sustainable Global Growth Plan. Now, back to Javier on growth and ESG. Thanks, Wolf. I would like to finish the call providing some more details and thoughts on the outlook for 2023, as well as the new five-year growth plan. 2022 was clearly a very challenging year in which we managed to achieve solid growth of 9%. For the next years, the growth plan that we announced at our Capital Markets Day is a strong plan, and we are very confident about the execution and the delivery of the results we announced. With regards to 2023, as you know, we'll provide guidance once the treatment charge has been settled around end of March. However, I would like to comment the following. We expect 2023 to be another challenging year, and we expect volatility. However, we see a solid floor in the result achieved in 2022. Actually, we are already in March, and I can confirm that the first two months of the year have been better than the last quarter of 2022, which make us confident for the rest of the year. Impact hedging will clearly be a positive impact into 2023 as the hedging level for this year is higher than the one for the last year. We expect a positive impact of between EUR 12 million-EUR 20 million contributions from hedging, depending on the FX, euro dollar. Treatment charge for zinc, on the other hand, is likely that will go up from the current $230 level. Remember that every $10 of change in the treatment charge has an impact of around $2.5 million on our EBITDA. We expect this to be a negative impact in 2023. In North America, the recently acquired zinc refining plant, which also contribute positively to earnings growth. Additionally, we have synergies coming from the Befesa acquisition, which will partially materialize in this year. In China, we are optimistic, but it is still very uncertain how the country will open after the strong lockdown they have suffered. We expect to see a gradual recovery and to have more visibility. However, it is difficult to know exactly what is going to happen in China. We expect to have volatility in Q1 and hopefully start to see increased levels of steel dust deliveries in the second quarter. We have two plants completed and fully ready to operate as soon as the market recovers. Overall, we expect positive contribution from China in the range of high single to low double digits in EBITDA. In the aluminum salt slag and secondary aluminum business, which is a purely European business, despite the automotive industry continues to face a challenging situation in Europe, in 2022, we managed to achieve a strong result and pass through the energy increase to our customers. For 2023, we expect volume of salt slag to increase driving by the restart of operations in our Hanover plant after the repair in the plant. In the aluminum business, we expect similar volumes than last year. Finally, commodity price for metal and energy are a question mark for 2023. We expect volatility in the price of commodities to continue, driven by instability at the macro level and uncertainties in the overall economy. Our hedging policy with around 70% of the volume of zinc hedged at good price will help us navigate this period of high volatility. Average zinc price in 2022 was EUR 3,300, up 30% compared to the previous year. This price is very high, and we will see if it is remain at this level for 2023. We also expect energy price to remain volatile. At this moment, it is a question mark whether it will be a positive or negative impact in 2023. Finally, on future growth, as we explained at the Capital Markets Day, despite the short-term challenging situation we are facing, we have a strong growth plan to invest around EUR 400 million over the next five years to grow earnings at a high rate. This growth plan is based on global mega trends like the decarbonization and transition to electric vehicles, which are not going to go away and will drive market growth where we operate in our core businesses. This is translated into a tangible plan consisting of seven projects across the three main markets we operate, Europe, North America, and China, which will be funded organically with our own resources. The first of this project was the acquisition of the zinc refining asset, which we already execute in September last year. The next two projects we are already working on are the refurbishment of the plant in Palmerton in U.S.A. and the third plant in China. In China, in February, we signed the investment agreement with the local authorities in the province of Guangdong. We have identified the land plot to build a new plant. We are preparing the basic engineering of the plant at the same time that we have started negotiations with the local steel makers. In North America, we have already started the refurbishment of the Palmerton plant. The engineering and design is in process. The request for quote with the price has started. They will carry out in 2023 and 2024. In summary, in 2022, we achieved record EBITDA in a challenging environment. We expect 2023 to remain challenging. However, we will see on a strong floor in the 2022 earning level. As I said before, the start of the year have been promising. We will navigate through this inflationary period successfully like we have done in the past. We are executing our growth plan that will deliver high growth over the coming years. We will keep our dividend policy of distributing circa of 50% of the net income. We are executing our ESG strategy to reduce our emissions by 2030 and 2050. Thank you very much. Thank you, Javier. We will open the line for your questions. Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question may press star followed by one on their touch tone telephone. If you wish to remove yourself from the question queue, you may press star followed by two. In the interest of time, please limit yourself to two questions only. If you're using speaker equipment today, please lift the handset before making your selections. Anyone who has a question may press star followed by one at this time. The first question is from the line of Michael E. Hoffman with Stifel. Your question please. Hi. Thank you very much, Javier. I'll start to take the questions. I realize and I appreciate that you give guidance at the end of March. Just directionally, do you expect to produce more profit greater than EUR 214 million in 2023 than you did in 2022? Michael, thanks for the question. Well, as you know, we will provide guidance once we know the treatment charge. That will be in Q1 earnings presentation in April. As I said during the speech, we see a solid floor in the results of 2022. We could say that that will be the lower part of the range we are going to provide to the market in April. The upper range will depend, let me say, basically of four things. Basically, treatment charge. Zinc price evolution, energy price evolution, especially coke, which as you know affect 50% of the total energy cost of Befesa, and China evolution. All in all, we will have a range between EUR 215 in the lower part, and let's wait till April to define the upper part of the range. That helps directionally. I appreciate that. Then, Wolf, what is your expectation for capital spending in 2023? Yes. Hey, Michael. Thank you very much. Well, we'll define it further, but regular maintenance, IT productivity spend is somewhere in the tune of EUR 40 million-EUR 50 million as usual, including the new operations, then growth comes on top. In growth this year we are preparing in China the third plant, the third province, but there's not much growth spending. It is, you know, Palmerton and the U.S.A., the refurbishment is the focus in this year that comes on top. Let's wait, but, you know, we don't expect to spend more than EUR 100 million of CapEx in this year, certainly not lower. Probably more in the range of, I would say EUR 40 million-EUR 50 million regular maintenance CapEx, and then maybe EUR 40 million or so on growth, but not more. Okay. That helps. Thank you. Yep. Thank you. The next question is from the line of Ingo Schachel with BNP. Your question please. Yeah, thanks for taking the question, and the first one would be on what you call the promising start into the year. Just wondering whether you could give us a bit more color on, let's say, which KPIs you were happy with in January, February performance. I guess zinc prices were high, so I can absolutely imagine that EBITDA is decent in January, February. Did you also see the same volume growth or recovery from the Q4 levels for steel dust reports in Europe, for example? Maybe you can also comment a bit on the evolution of coke price inflation. We've seen a very strong spike of coke prices in the recent weeks. Would be curious to understand a bit better when exactly this inflation will hit you, whether it's already included in what you said on February or whether there's a big spike from the coke inflation in Q2, or whether you can actually sit it out because it seems to be a temporary phenomenon that you might have enough inventories to not have to buy at these very high prices in recent weeks? Hi, Ingo. Thank you for the question. Always is long. The priority is gonna be longer than the answer. I mean, the info regarding January and February will come obviously in the Q1, I mean, the specific results. What we can say today is that deliveries of that are higher than in November or December in all the geographies. This is for us the key issue that it is, well, we don't know the numbers even in February. That's why I think that is very specific figures to be provided today is not possible. I think that I can say that the deliveries are higher and the energy cost in the aluminum is getting down, so it's supporting good margins. Yes, it's true that the steel, the coke prices are not getting down, so it's better to have a little bit more view to, as Javier saying, to see what the energy prices, especially in the coke, is going to happen during the next months. Yes, for us, it was a big, as we have explained, the Q4 in terms of steel production, deliveries of the plant and so was the challenge because the steel makers were to slow down the production and activity. Well, the uncertainty was to see how the new year is coming, and we can basically confirm that they are coming better. Not in the full production, as you probably recall from a steel, you know, players reporting. I think it's better. This is a very good sign now that we are gonna keep a level of production above the level of 2022. Any comment on the timing of the, let's say, last round of scope inflation or you can have to buy at current stock prices? Say that again, Ingo. The line is not very good. Okay. Sorry for that. I was just wondering on the recent spike in coke prices that you've seen in February, whether these will impact you already in Q1, on Q2, or whether you would be able to not buy at the current limited stock prices. Going now. Sorry, Ingo. Yeah. Yeah. The coke prices, I say the... It's not the start to get down, but at least are stable prices similar to the last part of the Q4 of 2022. We honestly hope that the coke prices get down in one moment of the year because it's basically the only raw material or commodity that is still rising in the fixed level. All the rest of the things are at least getting some decrease. Here it has not happened. We do hope that it's gonna happen during the, I don't know, Q2 or something like that. Okay. Perfect. Thanks so much. The next question is from the line of Sandeep Peety with Morgan Stanley. Your question, please. Hey. Hi. Good morning. This is Sandeep Peety from Morgan Stanley. Thank you for taking my questions. I have couple of them. Firstly, are there any learnings from first two China plants that you are implementing while constructing the third plant? The second question is more around European steel mills will require much more scrap as they plan to decarbonize their operations, given they will construct more EAF, which will be based on scrap and DRI. This would imply that scrap generated in Europe will stay locally. Do you think this will impact availability and quality of scrap in China in future? Thank you. Okay. Regarding the first part of the question, I think the most important learning that we have got from our first plant that we have been operating in, as you know, in a very difficult situation during all the 2022 year, is that China is a normal country. We have operate the plant as we do in any other geography. We don't see difference with the way we operate not only the plant but the business in North America, Europe or China. The steelmakers are normal steelmakers. The logistic runs very well. We are able to sell all the goods we produce in the internal market at competitive prices. Price very similar to the one we get in the LME following the same price. Financial conditions are okay. We have been able to finance 50% of our investment through local ones without a bank mother company warranty. At the end, we feel that we operate the plant as in any other geography. I think this is for me, the most relevant message we can send to you. What happened is that 2022 has been extremely difficult. Has been because the COVID restructure that we have suffering two things. On the one hand, receiving less steel dust than contracted. Not than expected, than contracted because the production was below the normal levels. Second, because we have been obliged to shut down the plant several times because the COVID restriction. The second question. Yeah. Yeah. I think it's what the Javier say. I think that the learnings of that probably we are gonna do in Guangdong the next kiln or kilns. I think that we are gonna operate the same way, and we have minor learnings from the construction. The other thing is that we are gonna try to put in place long-term contract with the default to run the plant, which is basically the planning in Guangdong. With regard to the second question about the scrap availability in the future in Europe, I think it's still early to say. The scrap production or the scrap recreation in Europe is growing little by little with the GDP and probably there gonna be more availability. What is true is that it's a switch from blast furnace production to the EAF, electric arc furnace production. It's true as well the BOF, although is the use of the iron ore, they use 10%-15% of scrap as well to refine and to do the refining and so on. Switching from one to the other, probably the good thing is that this scrap is gonna go to the mini mills. In any case, as always we try to explain, is that those projects are based on DRI because they want to produce DRI coming from hydrogen and so on. Mixing DRI and scrap in the new facilities to be built. At least the theoretical or the plan, the big guys like ArcelorMittal, Salzgitter, voestalpine, they are having. In our case, what we can do is even the level of zinc containing in the dust of the new projects are lower than in the current ones. Imagine, at the end of the day, what is clear is that we can mix with the current steel dust that we are receiving. At the end of the day, what is gonna happen is gonna be more zinc to be collected in the area. I do hope that, yes, as you are right, the scrap is probably will be available, quantity enough to support the increase. could affect to the exports of scrap that the European Union is doing out of the territory could be. I think it's like something to be developed and little by little, probably this war is gonna be, you know, all of that organized. I think that is could be enough. It's not a matter to pass to some blast furnaces to electrical or mini mills for full scrap usage. It's not the case. They are not gonna need so much scrap like to affect a lot to the market. This is our view today. Thank you. The next question is from the line of Jaime Escribano with Banco Santander. Your question please. Hi. Good morning. A couple of questions from my side. The first one, I didn't get the steel dust volume outlook for 2023. Maybe if you can repeat it, for group sales. Maybe you can break down by geographies, how do you see steel dust volume evolving in each of your regions? Also a question regarding margins at salt slags, which was quite high in 2022. It was around 35% in the first half, around 25% in the second half. Probably if I'm not wrong, because of the insurance collection from Hanover. The question would be: How should we think about the margin in salt slags, normalized margin for 2023? Thank you very much. Good morning, Jaime. You didn't listen the outlook of the steel slags production because we have not put on the table. No, qualitatively, I think Javier mentioned if the volumes you see it growing or not, maybe qualitatively you can tell us. Even by regions. No, we do expect this to slightly grow of the volumes. 2023 is a kind of transition year that we have to catch up the steel production increase expecting in 2024 in U.S. and 2025 onwards in Europe. We don't know. Whole 2023 is gonna be a very different year than 2022. This is the main idea that we can pass today. Slightly growth perhaps because we wait for that because China will definitely handle more gas. This is what we have in mind. Yes, we will hope to have a increase of volumes. Not very remarkable, but I think that is gonna be driven by China increases. I think that is what we can say, you know. Second part, Javier wants to answer. Yes. Jaime, regarding second question, yes, you are right. We have enjoyed a strong margin in solid slag during 2022, and that's been because we got some loss of profit from the insurance company and then, but we have less revenue because we didn't sell the quantities. Anyway, we in our solid slag business, we have been able to pass through the market, the increasing energy price we are suffering. So we expect a very solid EBITDA margin and EBITDA contribution for the year next year. Will be slightly below the one we have got last year, but with better volumes. At the end, we expect a solid, 2023 year in salt slag. Thank you. The next question is from the line of Lasse Stüben with Berenberg. Your question please. Hi, good morning. Just a question again on growth CapEx for this year. I mean, your number kind of implies that there won't be too much coming from the five-year plan. I guess you said, Palmerton will be the focus this year. Can you just remind us, sort of, will we see any CapEx already for Guangdong this year and how much we should be attributing to the Palmerton facility for 2023? Thank you very much, Lasse. Yeah. 2023, correct. You know that US Zinc Refining acquisition is done. Henan is done, and Hanover for the fire recovery is done. Yeah? The focus is on our regular maintenance, IT, et cetera, program, which is EUR 40 million-EUR 50 million. You're right on the growth side. Growth and the productivity SGGP programs, the focus is on the Palmerton refurbishment. Again, I would put there maximum EUR 40 million in the growth bucket, and that's a combination of the Palmerton refurbishment, the regular US productivity programs, and then maybe some very initial spend on design that as Javier and Asier mentioned, the land acquisition, because we already signed the land acquisition in the third province of China. Yeah. Again, I would say if it's regular maintenance, EUR 40 million-EUR 50 million, then up to EUR 40 million growth is around EUR 90 million. Put that in perspective. If you go back to our Capital Markets Day, there we said that the initial years we have a balanced cash flow. Where are we right now? Our operating cash flow run rate is somewhere around EUR 140 million. Last year, 2022 with a EUR 137 million operating cash flow. Call it somewhere around EUR 140 million. The only two things we need to fund from that is dividend and CapEx. Dividend, we said already we were proposing EUR 50 million, so you take the EUR 140 million minus EUR 50 million dividend, EUR 90 million left, and that EUR 90 million is available to spend on CapEx as explained. I think that fits to also what we highlighted during the Capital Markets Day, in November, yeah. Perfect. That's super helpful detail. The second question, I realize I'm probably jumping the gun a bit in terms of 2023 guidance, can you give us sort of how are you thinking about energy costs for this year? I remember sort of 2021 was about EUR 50 million. I guess 2022 with coke prices in Q4 was probably somewhere, I don't know, a touch above EUR 100 million. How do you see that for this year? What's your kind of working assumption given where the prices have gone over the past six to eight weeks? Any insights would be really useful. Well, this is Lasse. Thanks for the question, this is really a difficult question since we don't have the crystal ball. Anyway, what we have seen in the last quarter and what we have seen in the first two months of the year is that electricity and gas price are going down and are below the levels we got last year. On the other hand, on coke, the price are still at very high level. At the maximum, at the peak, we got in Q3 of 2022. Well, as you know, coke represent pretty close 50% of the total energy cost for Befesa and for us. I would say we have two question mark. Let's... What is gonna happen with the electricity and especially gas price evolution? Probably you guys will have your own view. We feel that we are enjoying a positive momentum right now, but we are not totally sure if this will stay for the full year. Second, for us, internally, the main question mark is if coke will follow the trend of the gas and electricity price as happened in the past. We feel that will happen, but well, what we are seeing today is that there is a resistance in the coke price to follow the price of the gas and electricity. Okay. Understood. Thank you. Thank you. The next question is from the line of Cameron Needham with Bank of America. Your question please. Thank you. Just two quick questions from me. Firstly, just picking up on some of the comments on things like energy and coke and coal. Could you just remind us what's the sort of contracting in place there? If prices do come off, is there, you know, a bit of a temptation to sign something longer term to give you protection on your energy costs? And then second question, just on the aluminum business unit. Typically much lower margin, the steel dust recycling unit. Why continue to spend a material portion of your growth CapEx on that business unit? Thanks very much. Thank you, Cameron. Regarding the coal, the kind of concept we are implementing in the last year and a half or even like that, is normally the shorter term that we can. I mean, it is, we say the spot basis, but in this field, it's not like the typical utilities like gas or electricity that you can buy monthly basis. Here, you have to have two, three months for delivering, talking with the brokers or the dealers of the coal. I would say that is the view that is not we have not as Javier explained it before, not a real view make us to want to run in the shorter level of timing. We'll say a spot basis, and understanding what is the spot basis in coal. Thanks, Cameron. Regarding your second question, yes, it's true that our secondary aluminum business has a smaller margin than the rest of the business. It's not the case as the salt slag business, as you can see in the presentation. In 2022, for example, we got better margins than in our steel dust recycling business. Regarding the secondary aluminum business, the only project we have included in our growth plan is to expand the capacity of our Bernburg plant. Our Bernburg plant has been very profitable business. We invest in the plant EUR 30 million, more or less. Out of that figure, EUR 10 million were subsidies, we are getting more than EUR 6 million of EBITDA per year. The payback of the plan has been really around 3 years. This is what we expect for the expansion of the plan, again, to get an excellent payback. On the other hand, we support the growth of our salt slag business. As I told before, it's around 30% EBITDA margin business. All in all, I think it deserves to keep this small amount of CapEx that we are going to invest in this business. Very clear. Thanks very much. Okay. thanks, Cameron. The next question is from the line of Oscar Val Mas with JP Morgan. Your question please. Yes, good morning, all. Just 2 quick questions from my side. The first one, going to the U.S., the Palmerton refurbishment. Just to be clear, even though that plant is being shut for 2 years, do you expect any volume impact, or can you shift the volumes to the other plants in the U.S.? The second question is going back to China. You talk about high single-digit, low double-digit contribution next year. Does that imply about 50% utilization? How do we see that between H1 and H2? How much do you expect in H1 versus H2? Thank you. Thank you, Oscar, for the questions. I mean, regarding U.S. Palmerton, I think that, yes, it's a little bit, well, to understand. We have already basically the capacity we want to have in U.S. even to capture the increase of the market that we hope in the next year. We were deciding what is better is to get the efficiencies that we have seen that, because they are old teams, there were many possibilities, like to build a new plant, like to build a new team or whatever. But finally, we decided to get the refurbishment of the current installation with Palmerton. That means not a proper increase of capacity because the builds or the walls or the investment we are gonna do. More than that, we are gonna increase capacity now in a minor amount of around 20,000-30,000 tons of capacity. The thing is that we want to capture the 200,000 tons that we estimate that we can capture in the U.S. market in 2024 and 2025 onwards with the proper technology to capture with all the synergies and to better to increase the margins in the U.S. It's a combination of The capture of the increased capacity is coming from the market, and we have to be ready to capture in the best way. This is the idea of the partners on the fourth business month. Regarding with China, it's a difficult question to put numbers on the table, especially H1 and H2. We are running now the plants after the Chinese New Year. What I have here, we have clear is that it's gonna be definitely much higher, the quantities that we are gonna treat in 2023 rather than 2022, where we ran just with 1 kiln and was more or less 50% of capacity. Here we are thinking, roughly 70%-80% capacity in Jiangsu, and Henan probably is gonna be in the 50, 60, something like that you can consider. Could be increased. We probably could be or could put more color on the next on the next conference call when we have running three months, because now it's very recently, you know, the Chinese country is waking up from the Spring Festival in basically February. We are having just the view one month, and we have to confirm that what we are receiving is gonna be in the in place for time. Yes, I think it's difficult for me to differentiate the H1 and H2. In general, we do hope there's gonna be an increase for sure of quantities that we are gonna treat in China. That's very useful. Thanks, Asier. The next question is from the line of Moomal Irfan with Goldman Sachs. Hi, thanks for taking my questions. Just following up on China, you previously mentioned that 80% of the volumes were already contracted for the first plant. What about the Henan plant? Are those contracted as well? Also, if you can comment on what the situation is like on ground currently, what are the biggest bottlenecks that you're seeing? My second question is that at spot prices, do you see commodity prices offsetting the cost inflation from higher coking coal, given gas prices have come off significantly? Thank you. Thank you very much for the question. When we are referring to the contracts in China, it's for the both plant. We have in place contract in Jiangsu plant, and we have in place contract in Henan plant. As Javier explained it, and we explained it in the speech, the contract normally is the whole production of that has to be delivered to the Befesa plant in this case. The case is that you have an estimation in view of the production they estimate to have normally or yearly basis. The question here is that because the COVID restrictions or the problems in 2022, they were not fulfilling the quantities we estimate. Now we are starting to get the, you know, the normal or the contracted tonnages, and that's why I answered before to Camille, or to Oscar, sorry, that what we hope that they're gonna have more percentage of the production capacity of the company based on the contract we have. It's in the case of both plants. The Henan plant, we are having contracts in the Henan province as well, and we are having contracts in the surrounding areas, and we need some more permits to move from one province to the other, so it's gonna take a little bit more time. That's why we hope that solve all those issues during the next months and run in a good level. Obviously, as Javier is explaining, we don't know how it's gonna happen in China over the full year, if the steel production is gonna go full production or whatever with the recovery. This is the uncertain. What we are watching, what we are, you know, realizing now in February, and again, it's very early, but it's gonna be better than 22 for sure. We will see, or we need more time to see how much or how much is better or how much is the result. Definitely we see like that. In the case of Guangdong, what we have is in place. We want to have those kind of contracts even before the construction of the company or the plant. In the previous cases where at the same time or even, you know, some of them are coming after the construction. Here we have the chance to be to deal with very big players with a good zinc containing in the dust because they are using scrap in the area. What we hope for Guangdong is to sign this letter of intent agreements or whatever, or even the contracts, to have secured the dust even before the plant is erected. This is what we intend to put in place, anyway, will be the same kind of contract with the tentative production and the full production to be delivered to Befesa. The kind of the framework of the contract is the same. Okay. While regarding the third question, the. I understood that is, which could be the effect in the commodity price of the, in coke, the high coke prices. Well, let's see. There is a clear correlation, not perfect, but good correlation between commodity price and energy prices. For me, it's hard to see that the coke price doesn't follow the trend of the rest of the energy price. Sooner or later, could be, in our opinion, it's a matter of the timing, of some delay, but late, sooner than later, we will see coke price following the energy price. If the things goes normally, we should see a good correlation between commodity prices and zinc price and energy price. Thanks a lot for your answers. That's helpful. The next question is from the line of Ingo Schachel with BNP. Your question, please. Oh, yeah, thank you. Just wanted to follow up with two quick housekeeping questions on the zinc refining and other adjustment impacts. First of all, in the steel dust recycling EBITDA adjustments, can you quantify how much of the EBITDA adjustment does not relate to the zinc refining situation? Maybe also remind us on cash flow when we look at the initial guidance of EUR 40 million at the lower end and the outcome that we've seen now, what the, let's say, non-operational factors were. I guess EUR 50 million zinc refining and then a bit of Hanover, maybe you can remind us what the right bridges between the 40 and the 60. Ingo, sorry, we have the same problem with the line that before, so it's very difficult to catch you entirely. I get the first part of the question about the adjustment of the. Well, the typical, as we explained in September as well, is the badwill requirement of the shipment of the accountancy. It's net of the normal adjustment of all the costs and other one-off adjustment that we have for the proper operation, as well with the insurance recovery for Hanover, and it's a mixture of many things, for positive and negative. The main one is obviously the badwill and is a reference for accountancy value of the company. Ingo, just in two weeks, or three weeks, we will publish our annual report. There you will have the note with all the explanations in the financial notes. Yeah. We are not sure about the next question, the other question. Sorry. I think it was really on the Hanover impact and the cash flow and let's say how the Hanover insurance cash flow that is in the EUR 60 million negative cash flow differs from what you had expected in the initial EUR 40 million guidance. Yeah. Okay. In terms of the cash flow walk, if you go to the page, you see that the walk starts with the EUR 250 million EBITDA, then you see about EUR 34 million negative impact in working capital. Yeah. Now, when you look at that, half of that is traditional working capital to fund growth. The other half really of that EUR 34 million, about EUR 10 million is really Hanover still to be collected. We expect to collect. The majority of Hanover fire recovery is already collected in 2022. There's about EUR 10 million that's pending, which we expect to collect in the first half of this year. Yeah. Then, the other one quarter is one-time cost of acquiring zinc refining, which has, as always, that is one time and has to be adjusted out. Yeah. Hopefully that helps. Yeah. It does. Thank you. Great. The next question is from the line of Jaime Escribano with Banco Santander. Your question, please. Yes. Hi. Just a final question from my side. I know you are not providing guidance, but just for the sake of all being on the same page in terms of expectations, when you see the Bloomberg consensus at EUR 250 million EBITDA, how do you feel about this number? Is this ambitious? Is this something that could be close to the upper part of the potential guidance? Or asking in a different way, what needs to happen in order to meet this magnitude of EBITDA? What in terms of zinc prices, volumes, the main moving parts that you mentioned, what needs to happen to be closer to this number? I think this would be helpful. Thank you. Again, it's speaking Jaime. Thanks for the question. Give us the one month and a half more than we need to answer properly the question because if not, we are going to enter in a speculation. We have said and we maintain the message that the closing of the mid-term of 2022 is for us, and we see that as a solid floor for 2023. We have a lower. It would be the lower part of the range. There are several variables that influence the upper part of the range. Again, treatment charge, we don't know yet how much will be the increase. Zinc price evolution, we need to get more comfort in that point. Coal price, which is affecting a lot, and as I said during the Q&A, we expect coal price following the rest of the energy prices, but let's see how long it takes to see that. Finally, China evolution. Our still many variables open. In one month and a half, we will have much better visibility, and we will be able to provide a guidance as we have done every year. Okay. Thank you very much. Thank you, Jaime. There are no further questions, and I hand back to Rafael Pérez for closing comments. Thank you all for your questions. You can also contact the investor relations team of Befesa for any further clarification. We will now conclude the conference call and the Q&A session. Let me remind you that you can find the webcast and the dial-in details to access the recording of this conference call on our website www.befesa.com. Thank you very much. Bye. Ladies and gentlemen, the conference is now concluded, and you may disconnect your telephone. Thank you for joining, and have a pleasant day. Goodbye.