Ladies and gentlemen, welcome to the Befesa first quarter 2025 results conference call. I am Jota, the Chorus Call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a question-and-answer session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Rafael Pérez. Please go ahead. Good morning and welcome to the first quarter 2025 results conference call of Befesa. I am Rafael Pérez, CFO of Befesa, and this morning I'm 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 for 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 a Q&A session. Before getting started, let me remind you that this conference call is being webcast live. You can find the link to the webcast and the first quarter 2025 results presentation on our website, www.befesa.com. Now, let me turn the call over to our CEO. Asier, please. Thank you, Rafa. We're moving to page five of the business highlights. Befesa has delivered strong first quarter results despite a challenging macroeconomic environment, which demonstrates the resiliency of our business model. Total adjusted EBITDA in this quarter has been EUR 56 million, up 15% compared to the same quarter last year, reflecting a strong performance driven mainly by a better price environment, partially offset by lower volume caused by plant maintenance stoppage across several plants. Operating cash flow has increased by 134% year-on-year, driven by a strong cash conversion. Net income and EPS also increased strongly by 97% year-on-year. Leverage at the end of the first quarter decreased to 2.78x, continuing our quarter-on-quarter improvement. In steel dust, we delivered a solid performance in the quarter, driven by a positive price environment, partially offset by lower volume due to plant maintenance shutdowns. Our secondary aluminum business remains being impacted by a challenging business environment with a weak automotive market in Europe. Palmerton reinforcement continued as planned, with the second kiln to be completed in the second quarter. I will elaborate on later all these aspects. On the outlook for the full year 2025, as already anticipated in the previous call, we are expecting a strong EBITDA growth in the range of EUR 240 million-EUR 265 million. We will continue with our prudent capital allocation, with a focus on reducing the financial leverage and growth CapEx ongoing approved CapEx projects of Palmerton and Bernburg. On balance sheet, we are targeting a financial leverage ratio below 2.5x by the end of 2025. I will comment on the outlook in more detail at the end. The page six steel dust business highlights. Overall, our steel recycling business has delivered strong results in 2024 in Europe and the U.S. In Europe, steel production continues at a low level caused by weak end market demand. Despite this, the daily steel dust deliveries from EAF steel customers continue in line with last year 2024 at good levels. The average load factor in the quarter stood at 86%, driven as explained by scheduled maintenance shutdowns in large assets. In the U.S., in the steel dust recycling business, average utilization was also impacted by maintenance shutdowns in the steel industry. In Palmerton, the first kiln has gone through ramp-up during the first quarter, and the cost reduction measures in the zinc refining plant are delivering as expected. In Asia, Turkey and South Korea operated at regular levels, and in our Chinese plants, continue running at utilization levels of 50% on average during the quarter, impacted by weak electric arc furnace steel production. Moving on to page seven, business highlights for the aluminum salt slag recycling business. On salt slag, we have delivered a strong volume, which has resulted in a very high capacity utilization of the plants at an average of 93%, pretty much in line with previous quarters. On the other hand, our secondary aluminum segment continues to suffer from a very weak European automotive industry, which is affecting the demand for secondary aluminum. This continues to pressure the aluminum metal margin, which is suffering compression compared to previous year levels, 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. Moving on to page nine, the financial results of the steel dust segment. Steel dust delivered EUR 49 million of adjusted EBITDA in Q1, which represents a 37% year-on-year improvement compared to the first quarter of 2024. EBITDA margin improved from 19% to 25% in the period. The EUR 13 million EBITDA improvement has been driven by the following factors: the year-on-year impact from volume reflected a decrease in total plant utilization from 70% to 64%, driven, as explained by Asier, by plant maintenance stoppages in some of our assets. Utilization is expected to recover over the course of the year. On price, strong positive EBITDA year-on-year impact of about EUR 15 million, with the three main price components being EUR 3 million of positive EBITDA impact from higher LME prices, up 16% in the quarter; EUR 8 million of positive impact from high hedging prices, up 8% year-on-year; and thirdly, EUR 4 million of positive impact from lower treatment charges on zinc, which was set at $80 per ton for the year 2025 versus $165 per ton for the last year. On cost and order, the general inflation cost was offset, with the cost cutting from the zinc refining in the U.S., as the cost reduction plan is delivering the expected results and improving profitability gradually. Moving on to page 10, financial results of the aluminum segment. Aluminum salt slag delivered EUR 9 million of EBITDA in the first quarter of 2025, which represents a 32% year-on-year decrease compared to the EUR 13 million from the same period of last year. The year-on-year EUR 4 million negative EBITDA development was mainly due to lower aluminum metal margin, as well as higher energy prices. On volume, overall, neutral EBITDA year-on-year impact during the quarter. Our recycled volumes of salt slag and the production of secondary aluminum remain pretty much in line with the previous year. With these volumes, we operated our plants at strong utilization rates of about 81% in salt slag and 93% in secondary aluminum on average. With regard to prices, overall negative EBITDA year-on-year impact of around EUR 2 million, mainly driven by pressured aluminum metal margins versus the previous year. As explained by Asier, this compression in the aluminum metal margin is caused by two factors. On the one hand, there is a scarcity of aluminum scrap in the European market, driven by lower overall industrial activity, as well as higher exports of alloy scrap away from Europe; and secondly, by a weak automotive industry in Europe, which impacts demand of secondary alloy from automakers. The aluminum FMV price increased by 6%, averaging EUR 2,460 per ton. This was partially offset by increased pressure from higher operating and energy-related expenses, mainly through the higher energy prices of electricity, as well as natural gas. Moving on to page 11, zinc price and treatment charges. Regarding zinc LME prices during the first quarter of 2025, zinc has been trading with some volatility over the marginal cost C90, trading sideways in the range of $2,700-$2,950 per ton. The average of Q1 zinc LME price has been $2,838 per ton, which is 16% above the same period of last year. On the right-hand side of the slide, on treatment charges. In 2025, treatment charges for zinc were set in April at $80 per ton for the full year 2025, compared to the $165 of last year, marking an all-time low record level. This reduction will drive earnings significantly in 2025. Recently, spot zinc treatment charges bottomed out with a mini rally, however still trading close to all-time low levels. Turning to page 12, on hedging, we have taken the opportunity of the volatility in the zinc price seen throughout 2024 and the first quarter of 2025 to extend our hedging book further to the beginning of 2027. With this extension, our zinc hedge book covers close to 20 months of hedging our books, at increasing hedging average prices of EUR 2,640 and EUR 2,655 per ton for the years 2025 and 2026, respectively. This level of hedging represents an all-time high level of hedging for Befesa and will provide around EUR 20 million of incremental EBITDA in this year of 2025, regardless of what happens with the zinc prices. We continue to monitor the market to close volumes for the remainder of 2027. Turning to page 13, Befesa energy prices. The page shows the evolution of the three energy sources that we have in Befesa: coke, natural gas, and electricity. With regards to coke prices, which totally represent around 55% of the total energy bill, the normalization that started in the second quarter of 2023 continues throughout 2024 and the first quarter of 2025. Average coke price in the first quarter has been around EUR 174 per ton, which is 6% lower than the same period of last year. Regarding electricity, which today accounts for around 30% of the total energy expense, prices have reversed their trend and have been on the rise since the middle of 2024. Gas prices experienced a slight increase in the first quarter. Now, turning to page 14, the cash flow results. Operating cash flow in the first quarter has reached EUR 34 million of EBITDA, which represents an increase of 134% compared to the last year. On the EBITDA to cash flow breach, starting with EUR 56 million of adjusted EBITDA to the left, working capital consumption amounted to EUR 15 million in the first quarter of 2025, down from EUR 34 million in the same quarter of last year. As in the previous year, the first quarter working capital was significantly impacted by seasonality, further influenced by lower sales compared to the previous quarter and higher sales year-on-year. Taxes paid in the first quarter of 2025 came in at EUR 6.5 million as a result of final tax assessment of the previous year, resulting in an operating cash flow of EUR 34 million in the first quarter of 2025. On CapEx, in the first quarter of 2025, we have invested EUR 11 million in regular maintenance CapEx, EUR 7 million in growth CapEx, mainly related to the refurbishment of the Palmerton plant in Pennsylvania. In summary, total CapEx of EUR 18 million in the quarter. Total interest paid amounted to EUR 9 million in the first quarter, aligned with the same period of the previous year. For 2025, the board directors will propose to pay a dividend of EUR 25 million, equivalent to EUR 0.63 per share or 50% of the net income. In summary, final cash flow amounted to EUR 2 million in the first quarter. Cash on hand stood at EUR 105 million, which, together with EUR 100 million undrawn revolving credit line, provides Befesa with more than EUR 200 million of liquidity. Gross debt at the end of March stood at EUR 718 million. Net debt stood at EUR 613 million compared to EUR 622 million in the same quarter in the last period, resulting in a net leverage of 2.78x at closing of the quarter, a strong improvement compared to 3.4x at March 2024. Turning to page 15, debt destruction and leverage. On the 20th of March, we successfully repriced our EUR 650 million senior secured TLV, reducing the interest rate by 50 basis points to Euribor + 225 basis points, which will lower our financing costs by approximately EUR 3.3 million per year. We can further reduce to a rate of Euribor + 200 basis points when we reduce our leverage below 2.5x. Following the refinancing back in July 2024, the repricing represents another achievement to improve our long-term capital structure by optimizing our financial costs. We will continue reducing the leverage throughout 2025 to keep it between 2x-2.5x going forward. To do so, we will prioritize our growth capex on these projects that will deliver immediate cash flow upon completion, like the approved projects of Palmerton and Bernburg and other market opportunities that could appear. Also, we will keep the annual regular maintenance CapEx around the level of EUR 40 million-EUR 45 million over the coming years. On dividend, we are committed to maintain our dividend policy to pay between 40%-50% of the net income to shareholders as dividend. Now, back to Asier on outlook and growth. Thank you, Rafael. Moving on to page 17 on outlook. As we already explained in the previous call, you can see in the page the main drivers of earnings on our view for 2025. We expect 2025 to be another year of strong double-digit earnings growth and further deleverage during the year. This is fundamentally based on better zinc hedging levels, lower treatment charges, higher volume of zinc dust recycled in the U.S. recycling plants, as well as lower zinc refining costs in the U.S. While we recognize that the political and economic environment has become less predictable due to the uncertainty that trade tariffs are creating, we expect limited direct impact in our business in the short term, and we see the long-term drivers of the business as intact. Today, Befesa is self-sufficient in each of the regions where we operate due to a strong local-for-local footprint. In a still last, we expect to continue running the plants at high capacity utilization and achieve a stable volume compared to 2024, despite current challenging steel industry in Europe. In the U.S.A., we expect higher EAF, EAF, steel dust volume driven by volume from new contracts. In China, we expect a slightly better situation than in 2024, with overall slightly positive contribution in the market. In our aluminum business, we expect the stable salt slag volume compared to 2024. However, as already explained, in secondary aluminum, we expect a negative evolution as we continue to see metal margin compression caused by aluminum scarcity in Europe and a weak demand from the outer sector. In the zinc refining plant in the U.S., we are taking operating cost cutting measures in 2025. We are aiming at a fixed cost reduction between EUR 10 million-EUR 15 million to be captured during this year. On energy prices, we expect a slightly lower overall coke price for the group in 2025. However, as seen already in this quarter, we are expecting natural gas and electricity prices in Europe to be higher than 2024. On treatment charges for zinc, as explained by Rafael Pérez, we are having a very positive impact from the reduction from $165 to $80 per ton. Also, average zinc price hedging for 2025 at EUR 2,640 will drive a strong earnings growth in 2025. On zinc prices, we expect to continue to see volatility driven by global macroeconomic and geopolitical uncertainty. The marginal cost of the production C90 is around $2,500 level, acting as a floor of the price of zinc. On business plan and capital allocation to focus on reducing the leverage and invest in ongoing approved expansion projects. As such, the expansion plan in China is stopped due to current market conditions. Our growth CapEx will focus on finishing the refurbishment of Palmerton and the expansion of Bernburg, both low-risk projects from the execution, technology, and commercial point of view. Moving on to page 18, the financial guidance. Putting all the elements explained above into numbers, we expect full year 2025 EBITDA to be between EUR 240 million and EUR 265 million, which represents between 13% and 24% growth year- on- year. Total CapEx in the year will be below EUR 100 million, with around EUR 45 million on regular maintenance and EUR 55 million on growth. Net leverage will be below 2.5x by the end of the year, and EPS will grow at least by 40% in the year. Moving on to page 19 on Palmerton. The refurbishment of the Palmerton plant in Pennsylvania is moving well on time and on budget. The first kiln is already completed and has been in ramp-up during the quarter, and the second kiln will be completed by the end of the second quarter of the year. Moving on to page 20 on Bernburg. With regards to the expansion of the secondary aluminum production capacity in the zinc plant of Bernburg in Germany, we are moving forward with the permits, authorizations, and commercial contracts with customers. This project is linked to the demand for recycled aluminum we are getting from the zinc Befesa customers in Europe. We expect to start investing in the plant during the second half of the year. In summary, our growth plan is flexible, and we are adapting it to the current circumstances, balancing with leverage and capex, which will result in a better growth and financial profile over this year, 2025, and the next years. Thank you very much. Thank you, Asier. We will now open the lines for your questions. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Anyone who has a question may press star and one at this time. The first question comes from the line of Ioannis Masvoulas with Morgan Stanley. Please go ahead. Hello. Thank you for the presentation and for taking my questions. First question on my side is on the zinc TCs where you flag the 50% decline year- over- year to $80. What TC level is baked into your Q1 results? Is there any lag effects where you could take some portion of last year's benchmark or not, just to get a better sense on the bridge into the second quarter? Second question, can you remind us what's the remaining growth capex in 2026 once you complete the two projects at Palmerton and Bernburg? Lastly, can you talk about the EPS guidance? Because it feels like EBITDA guidance was better than expectations, but EPS appears lower or more conservative. If you can build an EBITDA to EPS bridge for 2025, that would be very useful. Thank you. Hi, Ioannis. Thank you very much for the questions. Regarding the TC for the first quarter, it is basically $80 because, as a reminder, we have the contracts with the clause to go back to January 1st. Basically, once the things are confirmed, we are going with a new TC for the year. This is done. For the CapEx 2026, Rafael? On CapEx, Ioannis, as you know, this year we set EUR 100 million of total capex. Out of that, EUR 45 million will be maintenance, EUR 55 million will be growth. Out of that EUR 55 million, EUR 20 million will come from Palmerton. With that, the whole U.S. investment will be fully completed. Then the remaining EUR 35 million or so will be for the expansion of the secondary aluminum plant in Bernburg. Okay? Remaining CapEx for 2026, I would say it's still early. Obviously, there will be the remaining of Bernburg, which depending on how much we spend this year should be between EUR 10 million-EUR 15 million. Okay? Then, as you know, the remaining growth projects are the new salt slag plant in Poland, in Europe, which hasn't started yet. Then the second kiln in the Recytech facility in Europe, in France. Okay? These two projects, they haven't been approved by the board yet. We haven't started the construction. Depending on how we see the evolution of the markets throughout 2025, we will have a better picture throughout the end of the year. In any case, as we have commented, we have taken the commitment to cap the CapEx going forward for the next couple of years at EUR 100 million. Okay? That will give you a rough estimate. Okay? On the EPS, yes, you're right. I mean, below EBITDA to EPS, there are a number of elements. We have a strong view on financial costs, on the taxes. Our view is less secure. The 1.8 EPS level that you see in the presentation is a bottom. I agree with you. It may be conservative, but we prefer to be conservative in this case. Okay? You can see that 1.8 as a bottom for EPS this year. Thanks very much. Thank you. The next question is from the line of Shashi Shekhar with Citi. Please go ahead. Hi. Good morning, everyone. Thank you very much for this opportunity. I have three questions. The first one is on the zinc prices. What prices have you assumed in your 2025 EBITDA guidance? Second, what is the expected capacity utilization at the U.S. steel dust business this year? I just wanted to assess the improvement in utilization versus last year. My last question is on tariffs. I just wanted to understand the impact of tariffs on zinc, if applied in future, on your business. Thank you very much. Thank you, Sashi. I will take the first question on zinc, and then Asier will take the question on expected utilization for the steel business, which you need to look at data on a market-by-market basis because the dynamics are totally different. We will also address the tariffs question. On zinc, as you can see on the presentation, I think it's on page 17, the guidance is a range of EUR 240 million-EUR 265 million. Some of the elements that are in there are well-known, like the hedging level or the treatment charge. Some other things are unknown, like the zinc price. Last year, average zinc price was $2,780. I think the consensus of zinc price for this year is pretty much in line with that. Obviously, we are seeing volatility around these levels, not driven by the geopolitical tensions caused by the tariffs. In the lower part of the guidance, I cannot give you a precise number, but we consider a more negative scenario of zinc prices. On the upper side of the guidance, we consider a more positive zinc price scenario. I cannot give you a precise number at this moment. What we have is a strong view on the floor of the zinc price, which is driven by the zinc [ITCOS] score, which, when you look at the last 20-25 years, has been acting as a very solid floor for the zinc price, especially in economic recession periods. This level is around $2,500 pretty much today. We are expecting volatility driven by the macro environment, but the average we expect to be in line with last year. Asier will address the utilization. Yes. Thank you for the question. I think that we are confirming what we were discussing in the last presentations and contacts. The U.S. utilization rate that we are expecting this year is going to be more in the level of 75%-80% production level, keep growing in 2026 to above 80%-85%, and finishing in the next year close to the 90% that we see that is the target as we are doing in Europe. It is a growth from last year in around 15%-16% based on that, based on new contracts that we have in place for new projects coming into the picture. As well, we are starting to feel positive signals with the steel price in the U.S. because the tariff probably and some increased capacity of the current customers that we are having. We are confident that despite the year has started at a little bit lower level of production for steelmakers, now in the last month of March, April, the capacity utilization is growing. I think that we can reach this kind of level of 75%-80% capacity utilization level this year. Tariffs. Tariffs effects. On tariffs, I think that we have already said something. I would say in the U.S., probably it is going to be a positive matter, as I explained. There is still to be confirmed, and there are big uncertainties. We as Befesa are too small to have a real crystal ball for what is going to happen. I think that the main direct impact could be in the U.S. with a positive effect. It is more difficult to see indirectly how it can affect this to the other regions like Europe, China, if it is going to be export here and there. In our opinion, I think that because we are local for local geography focus, I think it is very difficult to see that it is going to have a big effect in our portfolio, but perhaps even positive in the U.S. I think I would like to remark this, that if any effect comes significantly, probably it is positive. Got it. Thank you very much. Thank you, Sashi. The next question comes from the line of Jaime Escribano Maiz with Santander. Please go ahead. Hi. Good morning. I have a couple of questions regarding the guidance range. Aside from prices, what other variables move you from EUR 240 million-EUR 265 million? For example, the zinc smelter, what are you estimating there in terms of volumes or China, for example? The second question is more qualitatively on Q1. I see a strong margin recovery in the steel dust despite the maintenance volumes. I was wondering what is behind that. Is it the recovery of the zinc smelter, for example? Similar question to salt slags, the other way around. The margin last year was very high, 36%. Now it is 25%, very similar to Q4. What could we expect in terms of the salt slags margin? Finally, a question on the secondary aluminum. You mentioned about the high stock prices, low auto demand, but maybe you can give us also a guidance on how you see the decision for the rest of the year. Thank you very much. Thank you, Jaime. On the different moving parts of the guidance, as I said in the previous question, there are a number of moving parts. Some of them are well-known. Some of them are more estimates. On the volume of steel dust, as Asier explained, we are seeing a strong momentum in the U.S. You can think about around EUR 5 million positive coming from that. On the other hand, as you said, on secondary aluminum, there is margin compression, which may be translated in something around EUR 5 million of headwind throughout the year. Let's see how the year evolves. On the zinc refining, as Asier explained, we are delivering the results on the cost-cutting exercise as expected. We are expecting around EUR 50 million on average. That is the midpoint. You can pencil in a more positive and a more negative scenario. Energy prices on average are slightly increasing in Europe, natural gas and electricity. You can think about another EUR 3 million-EUR 5 million headwinds together with inflation. Treatment charges is a positive effect of around EUR 80 million. Hedging is around EUR 20 million. These are basically the building blocks that will take you to the midpoint. You can pens in, as I said, a more pessimistic or more conservative scenario and then a more bullish scenario. On the margin on steel dust, I will pass to. Thank you, Jaime, for the question. Always interesting. I mean, about the margin in steel, we are observing this improving margins since the last part of the last year because all the costs more or less are controlled now in terms of coke and so on, no many changes. The remaining inflation costs that we were expecting are there. Obviously, what is affecting more to the margins nowadays is the treatment charge, as we say, is recorded for the first quarter prices. Because as Rafa explained before, we do hope as an average, probably in the range of last year with the consensus. It is true that in the first quarter, the zinc price has been a little bit higher. Of course, the hedging, that is a higher level. As well, obviously, we are improving the recycling, sorry, the refining cost, and we are going to plan to do those things. Altogether, it is making clearly the increase of the margins despite the sign of setting by lower volumes compared with last year. Basically, it is a matter of better income. Salt slag is true that it is a little bit below last year, the 25% margin. This is a combination of the first quarter. I think that punctually the beginning of the year was slightly the lower volume, slightly lower volume was focused at the beginning of the year because the restart of the customers for after Christmas. I think that is a consequence of the volatility in the aluminum business because the automotive and whatever. It's affecting us. We see that we are going to have a recovery of this business in the next quarters, staying with the numbers that we have seen in 2024 and the margin that we have seen. There is a matter of some extra costs as well for the electricity prices that we'll see. Nowadays, you can see the April prices in Europe, especially in Spain, are lower. We will see what happens. It's clear that it's affecting the first quarter results. Again, we will recover this. In the secondary aluminum, for ending with this, is where more uncertainty we have. I mean, perhaps it's a little bit better now in the second quarter compared with the first one, but it's very difficult to see the whole year here. That's why, as Rafa explained, it's one of the books that we have less clear about the evolution. In any case, we are having a negative view in general compared with last year, but nothing more than EUR 5 million-EUR 6 million or EUR 7 million maximum. Moving on that level up and down, we will see the evolution. It is a situation regarding with the automotive and regarding as well with the tariff issue because we are watching that scrap availability. Selling scrap from Europe to other parts of the world, especially the U.S., has not the tariff. The aluminum, yes. What is happening is now many scrap is going out of Europe, putting pressure on prices and pushing the margins a little. In any case, once again, it is nothing that is going to be a big issue more than, in the range of EUR 5 million-EUR 7 million up and down we will be. Thank you. Thank you very much. Thank you, Jaime. The next question comes from the line of Christopher Clifford with BNP Paribas. Please go ahead. Good morning, and thank you for taking my questions. The first question is on the treatment charge. Could you explain, please, the negative impact of the treatment charge on your U.S. zinc smelting activities? Related to that, can you give us some idea of the revenue contribution of the treatment charge for the asset in 2024, please? The second question is related to FX, and here we have seen some weakening of U.S. dollars versus euros. Can you give us some idea about your FX hedging activities and your open position when it comes to U.S. dollars in terms of revenues and EBITDA issues? Thank you. Thanks, Christopher, for the questions. Treatment charge U.S. As always, try to explain, we are not considering effect in the smelting unless internally we have in mind this because whatever you get negative in the smelting, you are getting positive in the recycling, right? The effect from the TC in Befesa now is limited to the European and Asian operations. Out of the U.S., I mean, with the increase itself, more than is melting on the others. Smelting is doing well, and I think that at the end of the year, out of the treatment charge evaluation, should be basically in the break-even point. Once again, the smelting in near terms should be seen like the washing plants. I mean, it's a way of how we sell the products there, but not affecting really this increase. Obviously, the smelting business in general for our customers is suffering because this TC is the highest ever. What is happening here is that probably, I mean, it should have an effect. We don't know if hopefully in the zinc price up or even in the premiums for the metal. Indirectly, I think that it's not going to be negative for our smelting or for our operation in the U.S., this change. Regarding FX, Rafa will explain to you. On FX, Christopher, basically a few thoughts and comments. Basically, first of all, we don't do any type of hedging on the FX. In the U.S., we have sales in dollars and cost in dollars. In Europe, we operate in euros and in Asia in the different currencies. Okay? The zinc price hedging, we also do in different currencies. In the U.S., we hedge in dollars. For the European operations, we hedge the zinc price in euros, and we also hedge the Korean operations in Korean wons. Okay? Obviously, the 30%-35%, which is not hedged, that is LME price, which is trading in dollars. Okay? In general, we prefer a strong dollar, but the impact of the fluctuations on FX are not so important in the case of Befesa. Very clear. Thank you. As a kind reminder, if you wish to register for a question, please press star and one on your telephone. The next question comes from the line of Jorge González with Hauck Aufhäuser Investment Banking. Please go ahead. Hello. Good morning. Thank you, Asier and Rafael, for taking my questions. I would like to follow up on some of my colleagues' questions before, especially in regards to the volume growth for the year. Just to avoid doing mistakes here with the utilization potential adjustments, I understand taking into account the EUR 5 million positive delta that you commented in EBITDA, that we are talking around 15,000 tons more of works in the year, more or less. That makes sense for you? That will be my first question, please. Yeah. It's around like that. Jorge, thank you for the question. Yes. 15,000, 16,000, 17,000, something like that could be a good reference. Okay. Thank you. Also, following on the smelting progress, I think it is quite interesting. The performance, obviously, of the EBITDA this quarter, I think, has already some impact from there. Can you give us some color on how it compares, the smelting EBIT performance in Q1 this year compared to last year at this point? When you talk about break-even, do you refer to that break-even run rate taking into account the last quarter or break-even for the full year? Clearly, it is a break-even for the full year, and it is a continued basic program. We are capturing in the first quarter as it was expected. Progressively, the results of the smelter are going to come better and better. Break-even at the end of the year, the first quarter, there is not a big effort, very big. I mean, it could be a comparison of EUR 3 million or something like that from last year's comparison. That was a situation totally different. At the end of the day, it's a program that we are establishing new fixed costs and new lower consumption of variable costs and so on, which is very difficult to have a picture. If we go through the progress of the plan, I think that we will capture the $15 million-$20 million, in this case, EUR 15 million, EUR 16 million, EUR 17 million at the end of the year. You can split along the year, among the year, some decreasing or increasing the savings, something like that. Okay. Thank you. Thank you for that detail. Lastly, on the development of the margins per region, the first quarter is all taking into account the strong declining in the volume process looks really positive for me. I was wondering, taking into account that some of the maintenance works, or mainly the maintenance works, was in Europe, and you are indicating only EUR 3 million declined in EBITDA in the quarter, I am wondering if this means that the EBITDA per ton in North America has substantially jumped because of Palmerton starting to work in the region and maybe the lower coke prices. Can you update us a little bit on how are the different profitabilities in the regions developing if there is already maybe a strong jump in Q1 in North America? Thank you. Thanks, Jorge. You know that always this kind of information we try to don't release a lot. In the particular case of the U.S., that it is obviously in the radar of all of you, I think that we can say that it's not a big difference still with the last part of the last year. We are in the level of $115-$120, and growing. I think that is what they say. The European and the standstills happen with the Q1. What means is probably, as we expected, this is the lowest quarter on results that we expect this year. We anticipated this because the large asset that we are stopping this quarter, or we have stopped, is in Europe, which you know that is a higher margin. This is affecting. We are positive that the rest of the quarters of the year are going to be higher of this one. That's why we will end in the range that we are indicating. This is the worst quarter in a still last that we expect this year. Okay. Thank you very much for the color. I'll go back to the line. The next question is from Beltrán Palazuelo with DLTV Europe. Please go ahead. Hello. Good morning, Rafa, Asier, and team. Thank you very much for getting my question. Congratulations for the strong results and the strong guidance. My only question is regarding, I think another analyst already asked it, but to have more color on the conservative guidance on the EPS, if you could give us a little bit more color on the financial cost because clearly, if you do the math, around EUR 7.5 million-EUR 8 million per quarter should be the financial cost. Seeing the tax, it never has been over 28%. It seems that it's extremely conservative. You have at least above 15%. Why put, I don't know, 1.8 and not 2? Because if you get the guidance, and all the points you have, it seems that that part of the guidance has nothing to do with other things. Is there something in financial cost that I'm missing or something in tax that you have not disclosed in your numbers? Why 0.8 and not 2, for example? You are totally right, Beltrán. It's a conservative level of 1.8. We had internal discussions, but as you know, we don't usually provide the EPS guidance, and we always focus on EBITDA and net leverage. We wanted to be more transparent with you, but we also wanted to take a conservative approach. I agree with you that being 1.8, the bottom of the expected EPS, probably a level around 2 is a match, or even above 2 is a much more reasonable level. Okay? We will update the EPS guidance for the full year as we go reporting second quarter. Okay? In essence, I agree with you, Beltrán. Good comment. Thank you very much. All the support from my side, and thank you for the strong execution. Thank you, Beltrán. The next question is from the line of Fabian Piasta with Jefferies. Please go ahead. Hey, good morning. Congrats for the strong print. Two questions from my side. You alluded on the positive green shoots in China. Could you maybe give some color on that, what this was driven by, and how sustainable this is expected throughout the year? Second one is on the treatment charge for 2026. Are you expecting a slight reversal of the positive trend now due to smelter capacity decreasing again, or do you think that smelter capacity in China is going to hold up and that we're going to see a similarly low treatment charge in 2026? Thank you very much. Good question, Fabian. Thank you. I mean, in China, it is a difficult quarter to extract conclusions because you know that the Chinese New Year session makes that the steelmakers and even our plant is stopped for one month or even something like that. What we are observing is that, as expected, there is not a growth in the capacity utilization for the steelmakers. We remain having the view for the year in the level of, well, 70%, 60%-70% capacity utilization at the end, but it is still to be confirmed. Obviously, there is not a big effect, again, here with China going to the 50% or to the 70%, but we still hope that we are going to end a little bit better than last year. It will depend on the evolution of the Chinese steel production, basically, and the economy. At least for now, there are no big changes, but I think that we can stay expecting this because it's not a big issue in reality. With regard to the treatment charge of 2026, allow me to say that, let us enjoy the good level of 2025, and we will start to think in 2026. Because this year, in a logical answer of this question, normally when everything is down, it should be on the contrary the next year, but the level of contrary, if it happens, will depend on many things that with the current uncertainty in the economy, I don't know. I really don't know, and it's too early to think in nothing. Okay. Thank you very much. Thank you, Fabian. We have a follow-up question from the line of Ioannis Masvoulas with Morgan Stanley. Please go ahead. Hi. Yeah, just a follow-up. Someone else asked it earlier around your FX exposure. If you could perhaps quantify the net dollar exposure you have, I appreciate that it only relates to the unhedged LME portion. Is it around $200 million? Maybe if you can give us a rough sensitivity, what's the P&L impact on perhaps a 1% change on the dollar versus the euro, that would be very useful. Thank you. Hi, Ioannis. What I tried to explain was the different parts where we have exposure to the FX. On the hedging of zinc, which, as you know, represents 70% of the volume of the sales, we hedge in different currencies. In Europe, we hedge in the same price in euros, in the U.S. in dollars, and in South Korea in Korean won. The non-hedged portion is trading in dollars. All the operations in the U.S., obviously, we have sales in dollars and cost in dollars, and that EBITDA, when we consolidate, we have to translate those EBITDA in dollars into euros. If you want to come follow up by email, and I can send you a—I haven't got a sensitivity of the FX in front of me, but I can follow up with you. That would be great. Thank you so much. Thank you, Ioannis. The next question comes from the line of Zgaya Anais with Oddo. Please go ahead. Yes. Good morning, and thanks for taking my questions. I have three quick ones. First, two on the U.S. and on EBITDA per ton target. What is your target in the U.S. for EBITDA per ton treated ton in 2025 and going forward? Secondly, you said that the impact of tariffs could be positive in the U.S. Could you please explain in more detail why? Third, on the guidance, could you please repeat the building blocks to reach the guidance midpoint? Thank you very much. With regards to the EBITDA per ton in the U.S., as I always say, it depends on many things, but I think that we are not changing the idea to move from the $120-$150 in a couple of years. This is the target, and we will move on down. In regard to tariffs, logically, one can think that if you put a tariff in the U.S. and you do not get into let steel production from outside, prices there are getting up, and with higher margins, the steel production is covering the imports that are coming, and obviously, with better prices, at the end of the day, they are willing to produce more. This is something that is starting to happen and happened in the past. That is why we do hope that the tariffs in the U.S. for the steel in production, it is positive. Still, again, and repeating, we don't know. We cannot assure this is going to happen, but I think that is the trend that we can see in the U.S. and has happened in the past with the new tariffs. With EBITDA, I think Rafa asked it. The bridge challenge I already explained in a question to Jaime, but starting at the full year EBITDA of 2024, you can pencil around EUR 5 million of better volumes in the U.S., around minus EUR 5 million. As I said, these are ranges, the midpoints, minus EUR 5 million for secondary alu, but it could be slightly higher, slightly lower. On the steel refining, you can pencil around plus EUR 15 million or so. Energy, we are seeing headwinds, which could be a headwind of around EUR 3 million-EUR 5 million. Treatment charges of around EUR 18 million of impact, and then hedging around EUR 20 million of positive EBITDA. Okay? You have also some general inflation, which is a headwind of around 3%-5%. Okay? Okay. Thank you very much. Thank you. Thank you, Anais. Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Rafael Pérez for any closing remarks. 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 to all of you, and have a good day. Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.