that this conference is being recorded. I now hand the conference over to Ms. Megan Cochard, Director, Investor Relations. Thank you, and over to you. Thank you, operator, and good morning or evening, everyone. Welcome to Novelis' second quarter fiscal year 2024 earnings conference call. Hosting our call today is Steve Fisher, our President and Chief Executive Officer, and Dev Ahuja, our Chief Financial Officer. Following the presentation, the call will be open to analysts and investors for questions. This conference call is being broadcast on the Internet at novelis.com in the Investors section. A replay of this call will also be available on our website. Before I turn the call over to Steve, let me remind you that today's earnings release and presentation include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties. These risks and uncertainties include, but are not limited to, those factors identified in the release and in our filings with the Securities and Exchange Commission. Today's presentation also includes certain non-GAAP measurements. Reconciliation of these measurements is provided in the financial statements included with our earnings release, as well as in the appendix of our presentation. Now, let me turn the call over to Steve. Thanks, Megan. Good morning or evening, everyone, and thanks for joining us today. Let me start with the highlights on slide three. We are extremely pleased with the continued improvement in Adjusted EBITDA and Adjusted EBITDA per tonne in the second quarter, demonstrating the operating leverage we gain with higher shipments. In spite of macroeconomic uncertainties, demand is improving in our core beverage packaging market, and we delivered a solid quarter. Our business is resilient, demonstrated by our diverse customer base across premium end markets, our leadership position in aluminum recycling and improving recycled volumes, a solid balance sheet, and the scale and efficiency of our global operations. We believe it will only be further strengthened in the coming years through our investments underway for new rolling and recycling capacity, as well as other strategic actions that build for our future. Some highlights over the last few months include signing an anchored customer contract with aluminum packaging company Ball Corporation in North America. The new contract is an extension of a multi-decade partnership between Novelis and Ball, stemming from a mutual focus on sustainability and innovation. With this contract and other commitments, we have secured all of the beverage can capacity for our new Bay Minette plant two years before the plant is anticipated to be complete. This underscores the strong demand for our high-recycled content beverage packaging sheet. We also renewed a contract with Airbus for supply of aluminum plate and sheet products, as well as for technically demanding aluminum wing skins. As the only supplier of aluminum plate and rolled products for the aerospace industry in both Europe and Asia, we are excited to enhance the long-term partnership between Novelis and Airbus and further our role in providing innovative and sustainable aluminum products and solutions for the commercial aerospace industry. Regarding sustainability, we released our fiscal 2023 sustainability report in September, highlighting the progress and actions against our ESG goals. Among a number of metrics, the report shares the progress toward our goal to reduce absolute carbon emissions by 30% by 2026 from our fiscal 2016 baseline, with a 14% reduction achieved in fiscal 2023. We are also enhancing the financial sustainability of our business. In September, we successfully refinanced an outstanding $750 million term loan at more favorable rates. We are taking steps to optimize our product portfolio, simplify our manufacturing footprint, and reduce fixed costs with the decision to shut down a North American specialty finishing plant in Clayton, New Jersey. Perhaps the most evident sign of building for our future is in our strategic investments in new capacity and capabilities, as outlined on slide four. We are making great progress across a number of activities, from construction to contracting, at all of our major CapEx projects. The largest project is, of course, our U.S. greenfield rolling and recycling plant in Bay Minette. Construction at this state-of-the-art plant is moving right along. Bay Minette will have an initial finished goods capacity of 600 kt, primarily focused on supplying the growing beverage, packaging, and automotive markets. As I said, we have already secured long-term customer commitments to all of our beverage packaging capacity at this plant. Investments for new recycling capacity in Guthrie and Ulsan are also continuing along schedule, as are the high-return brownfield investments to debottleneck existing assets and unlock valuable capacity. Three of these debottlenecking projects at Pindamonhangaba, Oswego, and Yeongju are making contributions this year. In Brazil, the first of two phases to ultimately debottleneck 70 kt of total capacity in South America was completed in July. Through an expansion of remelt and casting capacity at Pindamonhangaba plant, we have improved productivity and expanded finished goods capacity by about 40 kt. The Oswego hot mill debottlenecking project in North America is also a two-phased initiative that will lower input costs by replacing costly third-party metal and increase throughput by running at faster speeds. We are completing a critical milestone as we speak, safely coming out of an extended three-week outage to replace our hot mill motor and switch to a more energy-efficient power system. The second phase of the project in calendar year 2024 will be the installation of a new coolant house and a hot mill to improve quality and productivity. A $20 million investment in Yeongju, South Korea, to increase finished goods capacity was complete in October. Through equipment investment and process changes, we debottleneck the hot mill to unlock approximately 50 kt of finished goods capacity and derive environmental benefits, such as reduced natural gas consumption and CO2 emissions. I commend our project teams and all of our employees for the excellent work installing these upgrades while maintaining their commitment to safety and ensuring business continuity to meet our customer needs. Now I'd like to turn the call over to Dev for a detailed review of our second quarter financial results. Thank you, Steve, and good morning or good evening. Starting with our Q2 financial highlights on slide six, net sales decreased 14% to $4.1 billion, primarily driven by lower average aluminum prices and lower product shipments, partially offset by increased product pricing and favorable product mix. Total flat- rolled product shipments decreased 5% year-over-year to 933 kt, driven by lower beverage packaging and specialty shipments as compared to our prior year that benefited from more favorable market and macroeconomic conditions. Aerospace shipments were steady, while automotive shipments increased year-over-year on increased adoption of aluminum and recovering vehicle build rates. We have had no material impact by the UAW union strike, which is now settled. Importantly, total flat-rolled products improved on a sequential basis, increasing 6% compared to fiscal Q1, as customer destocking activity in the beverage packaging market is largely behind us. Adjusted EBITDA was down 4% year-over-year to $484 million in the second quarter. I'll cover those drivers on the next slide. Again, the sequential improvement in Adjusted EBITDA compared to fiscal Q1 is notable, increasing 15% quarter-over-quarter, driven primarily by higher shipments, showing the significant power of operating leverage in our business. EBITDA per ton also continued its sequential recovery, improving to $519 per ton in Q2, which is slightly better than the prior year. Net income attributable to our common shareholders was down 14% over the prior year to $157 million in Q2, driven primarily by lower Adjusted EBITDA. Net income, excluding special items such as metal price lag and unrealized derivatives, was $180 million in the second quarter. Moving to the Q2 bridge slide on seven, the year-over-year decline is fundamentally a factor of lower shipments impacting both volume and metal benefit within operating cost. The impact of lower shipments resulted in a $52 million headwind from volume. However, we continue to see year-over-year favorable pricing, including cost passthroughs, as well as better contribution in product mix from higher automotive shipments. The increase in cost is primarily due to a prior year favorable impact from capitalizing higher operating costs into inventory, as well as lower metal benefit from recycling. In addition to lower aluminum prices, the metal benefit was lessened as we produced and shipped less beverage cans and other high recycled content specialty sheet in Q2. Other operating costs are mixed, with increase in labor and repairs and maintenance, more than offset by some reduction in other inflation-driven costs like freight, energy, coatings, and alloys. FX was also a tailwind in the quarter, driven mainly by favorable currency translations in Europe. Let's turn to slide 8 and view the performance year-over-year by segment. North America shipments grew 1% year-over-year. Beverage packaging shipments grew to a record level in the quarter, as demand appears to be normalizing in the region. Automotive shipments also increased over the prior year on stronger OEM demand, but the weaker macroeconomic environment and high competition led to lower specialty and building and construction shipments. Adjusted EBITDA was up 9%, driven by higher volume, higher pricing, including some cost passthroughs, favorable metal benefits, and lower operating costs. These positive factors were partially offset by a prior year favorable impact from capitalizing high cost into inventory during peak inflation. Those high costs came out over the next couple of quarters in North America and created some timing impact between the first and second half of last year. Moving to Europe, shipments were down 5% as both beverage packaging and specialty shipments were lower due to the softer macroeconomic environment, partially offset by higher automotive shipments on stronger OEM demand. Despite the lower shipments, EBITDA was up 37%, driven primarily by higher contracted pricing, as well as translation benefits on the stronger euro and from lower operating costs. Energy costs on a blended basis, net of our hedges, are fairly stable, but still remain well above pre-Russia-Ukraine War levels. Turning to slide nine. Asia shipments declined 16% versus the prior year, nearly all driven by softer beverage packaging demand in select markets supplied by our Asian operations, including Southeast Asia, the Middle East, and Mexico, partially offset by higher specialties shipments to the stronger EV battery market. Adjusted EBITDA decreased 27%, due mainly to the lower volume and less favorable metal benefits from lower beverage can sheet production. Operating costs are largely lower than the prior year, primarily freight, but offset in lower related passthroughs in price. South America shipments were down 11%, due mainly to lower beverage packaging demand in a tough macroeconomic environment for the consumer in a seasonally low quarter. However, we are encouraged to see a strong 21% improvement in total South American shipments compared to Q1, indicating that destocking is largely behind us. Adjusted EBITDA was down 27% year-over-year, primarily driven by the lower volume and lower metal benefits from lower can sheet production. Let's turn to cash flow on slide 10. Fiscal 2024 year-to-date adjusted free cash flow was an outflow of $300 million, but this included a planned significant increase in capital expenditures as we ramp up our transformational capital investments in this year. We have previously said that capital expenditures will be between $1.6 billion-$1.9 billion this fiscal year, and we expect to be on the lower end of this range. Free cash flow before CapEx increased 69% versus the prior year to $380 million. The increase was driven by lower working capital requirements, including lower inventory and some relief from lower aluminum prices compared to the prior year, partially offset by lower Adjusted EBITDA and higher interest payments due to higher variable rates. Last month, we completed the refinancing of our previous $750 million outstanding 2025 term loan with a $750 million term loan due September 2026 at more favorable spreads. We continue to manage a strong and prudent balance sheet with no significant debt maturities in the near term. We ended the quarter with a net leverage ratio of 2.7x and a total liquidity of $2.3 million. I'd now like to turn the call back over to Steve for an outlook and summary. Great. Thanks, Dev. Let me provide a brief view of demand across our end markets on slide 12. First and foremost, our positive long-term view of growing demand for sustainable aluminum products across all end markets and regions is unchanged. Even from where we sit today, we don't see any clear signs that demand will deviate substantially in either direction. However, we acknowledge that the current unstable macro and geopolitical environment limits visibility and could drive some short-term demand choppiness. Starting with beverage packaging, demand is stabilizing after being significantly disrupted by inventory destocking activity across the supply chain over the past year, there are some nuances between regions. The U.S. market is solid, with some promotional activity returning and customer demand for local supply staying strong. We don't foresee any major deviations to this trend in the near term. We are seeing demand in South America continue to strengthen heading into their summer selling season. However, we are watching how the extended macroeconomic challenges may pressure consumer spending in Europe, Mexico, and parts of Asia. We are seeing particular weakness in Vietnam, which ranks number one in Southeast Asia beer consumption and ninth largest globally. In automotive, we have a diverse customer and geographic footprint, portfolio, and demand remains stable in all three regions that we have operations in for that market. We are watching for potential softening of consumer sentiment. The latest U.S. vehicle production forecast for this year and next show continued growth due to high pent-up consumer demand and at a vehicle mix that favors higher aluminum content. The agreements now between the UAW and all three U.S. automakers previously under strike is a positive development, and we estimate there is no material impact to our business. Near-term demand visibility and specialties end market remains more clouded. Historically, many of these product markets have been more sensitive to economic cycles, and the current macroeconomic environment is unstable. While we see some optimism in U.S. building and construction markets with higher share of new home build rates and ongoing demand for repair and remodels, high inflation and interest rates is pressuring this business in the U.S. as well as in Europe. We also are seeing increased competition in some other specialty markets, such as container foil, as a weaker Chinese economy is driving an increase in exports to other regions. Demand for premium aerospace plate and sheet remains strong, reflecting the strength from growing OEM build rates, supported by multi-year backlogs for aircraft deliveries. Our long-term positive demand outlook for infinitely recyclable aluminum is unchanged, driven by increasing consumer preference for more sustainable aluminum products and beverage packaging options. We are continuing to navigate through macroeconomic and geopolitical uncertainties that challenge near-term demand visibility. In spite of this, we delivered strong results in the second quarter, with continued improvement in Adjusted EBITDA and EBITDA per tonne, as expected, demonstrating the operating leverage of our business when shipments improve. We anticipate beverage packaging shipments will continue to increase sequentially through the second half of the fiscal year. We reiterate our near-term Adjusted EBITDA per tonne guidance of $450-$500 per tonne in Q3 to account for longer than usual planned maintenance downtime, including the Oswego hot mill upgrade, and stand by our guidance to reach $525 in Adjusted EBITDA per tonne in Q4 this fiscal year. Novelis' business is resilient, supported by our strategy of portfolio diversification and recycling and operational excellence. Between this strategy, our strong balance sheet and proven track record in building and ramping new capacity, we are well positioned to capture the long-term aluminum demand trends we see ahead. With that, we're happy to take any of your questions. Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. In order to ensure that the management is able to answer queries from all participants, kindly restrict your questions to two at a time. You may join back the queue for follow-up questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have our first question from the line of Amit Dixit from ICICI Securities. Please go ahead. Yeah. Hi, good evening, everyone, and thanks for taking my question. Congratulations for a good set of numbers and reaching within a throwing distance of $525 per ton of EBITDA. My question is precisely on this. While, you know, we expect beverage can volumes to improve in Q3, and with it, I'm hoping recycling content will also go up. Despite the planned annual maintenance, downtime and everything, why are we still guiding for EBITDA per tonne of $450-$500 when we have favorable tailwinds? You just mentioned that UAW strike is not going to have any material impact. Just wanted to get a sense of it, you know, where do we see the cost escalating, if it is? Just wanted to get my head around it, essentially. Yeah, Amit, here is what happens. In Q3, we have a long outage, particularly Oswego hot mill. With that, what happens is that production comes down, and we deplete inventory. As we deplete inventory, it kind of has an impact on our EBITDA. Essentially, what is going to happen is that quarter 3 is going to be impacted by this maintenance shutdown in particular. We have other maintenance shutdowns as well, in other regions. That is the primary reason why we are guiding Q3 lower. Q3 seasonally is a lower quarter, with some exceptions in some years, particularly during COVID. Q3 is seasonally a lower quarter. It is really driven by timing and seasonality, nothing else. Fundamentally, our business is progressing in the right direction, subject to the macroeconomic environment, and we are again asserting our confidence for the fourth quarter. Remember, we always kept telling you. I mean, last quarter, we told you $450-$500. This quarter has proven to be a nicer quarter than we anticipated earlier. There should be no surprise between what we've been telling you earlier and what we are saying now. Okay. The second question is on working capital. I mean, this quarter, if we see, generally, we have working capital relief in H2, but this time it seems working capital relief or working capital going into the business is much lower compared to last H1. In this H2, do we expect or anticipate the similar working capital relief as we saw last year, or will it be lower? Is it possible to quantify it at this point in time? We will have a reduction in working capital in H2. Primarily, we expect the use of some of the inventory that we have built up. There will be a release of working capital in H2. This time it will not be like last year. I mean, last year we had a particularly strong build up in the first half. ... and a big release in the fourth quarter in working capital. You should not expect to see the same levels. This time it's a lot more balanced, which I think is actually much better. Net net, to your question, second half there'll be a release of working capital. Okay. In a nutshell, we expect this 2.7x net debt to EBITDA. That could be on the top as far as this year is concerned? That would be what, sorry? That would be the peak net debt to EBITDA that we will see for this year, 2.7x. Yeah. Amit, I think, I think, what we should really do is really stick to the messaging we have been doing. Our commitment is that we will not grow beyond three, right? Quarter- to- quarter, you know, I mean, depending upon the intensity of the CapEx and the phasing of the cash flow, you know, I mean, we can see some ups and downs. Generally, you know, what will happen is that with Q3, the last year Q3, which was weighing heavily on the trailing 12-month EBITDA, will benefit this time. You know, that will be a benefit this time, so we should see some benefit of that. On the other side, CapEx is intensifying. Let's just say that we will not deviate from our messaging of staying below three, at or below three. That's really what it is. Okay, fair enough. Thank you and all the best. Thank you. We have our next question from the line of Indrajit from CLSA. Please go ahead. Hi, thank you for the opportunity. My first question is on the product mix. Earlier, you used to give out the share of mix across various subsystems like beverage and autos, et cetera. If you can share the similar mix this time around? Yeah. I think we provide some guidance around on an annual basis, but on a quarter-to-quarter basis, it doesn't vary all that much. You know, you can think of our product portfolio as roughly, you know, 60% beverage packaging, just under 20% automotive, about 15% specialties, and about 5% aerospace. Sure. No, that is helpful. The reason I'm asking is, earlier you had highlighted that operating leverage is a big part of our business, and in this quarter, despite reasonably weaker volumes, we have seen EBITDA per tonne to sequentially rise. How do you see that? Do you think that the mix benefit is much better than the disadvantages that we had due to operating leverage? I think we talked about it in our prepared remarks. It's about the operating leverage. We've been talking for several quarters about getting past the peak destocking of beverage packaging, and we had signaled that by the time we got through the first half, we would definitely have that behind us. We're starting to see increases associated with volumes, which is primarily in the beverage packaging, which is what's dropping to the bottom line in providing that operating leverage associated with the business. As we said in our prepared remarks, we'd see sequential growth in beverage packaging for the second half of the year as well as we put the destocking behind us. Sure. My second question is on the South America market. It is, at least in the last five years, the lowest profitability that we have clocked in that market. Do you think we are close to the bottom here, or we could see two more quarters of pain in that region? Yeah. South America is on the path to recovery. I think that, as we had said in the previous quarter, that was a peak destocking quarter. You see, starting from this quarter, volumes beginning to recover. The EBITDA per tonne does not really reflect the full potential of that, because in this quarter we had a planned maintenance. As a result of that, production gets impacted. If you are looking at, you know, the EBITDA per tonne in this quarter and wondering why it kind of came down despite the higher volumes, the reason is simply that it was a planned maintenance quarter. In short, if I were to answer your question, we will see recovery in volumes, and therefore we will see the impact of operating leverage in South America, and the EBITDA per tonne levels will improve, will improve very meaningfully from what you see in this quarter or even the previous quarter. I mean, just to follow up, do you think that four-digit numbers are achievable or that was effectively a one-off? What is achievable, sorry? The four-digit EBITDA per tonne number that we had seen in a few quarters, almost close- I mean, haven't we said it several times that, you know, things that were happening during COVID, I mean, they're very, very easy. If you're talking about $1,000, I think we've already said that those were not representing a normal time. I mean, scrap availability was particularly easy, and, you know, at-home consumption was at very, very high levels. We have always said that those don't represent a normal situation. All that I'm telling you now is that what you see in this quarter is not normal either, and we will see some benefit of operating leverage as volumes pick up in South America. Sure. Thank you. That's all from my side. Thank you. Thank you. Thank you. We have our next question from the line of Sumangal Nevatia from Kotak Securities. Please go ahead. Yeah. Good morning, and good evening, everyone. My, thanks for this opportunity. First question is with respect to volumes. First half, we've seen almost 7% decline on a year-on-year basis. Second half, given the outages and then, recovery in various segments, what sort of volumes do we expect, and what it turns out to be for the full year, if you could help us on that? First quarter will be impacted by the seasonality, Sumangal, except for South America, where seasonal purchases start happening starting from this quarter, the running quarter. We will see some mutedness in volumes in the third quarter. Fourth quarter should be a nice bounce back, and that is what will help the guidance that we are giving about bouncing back to levels of around $525 per ton. I would say a little bit of a muted third quarter, nothing like the second quarter, by the way. The second quarter was an abnormally low quarter from peak destocking. Third quarter will be a little bit muted compared to the second quarter. Fourth quarter will be a very smart bounce back, is what we expect for now. Thanks, Dev. Is it possible to quantify on the volume growth part? I mean, for the full year, what sort of decline are we expecting, given first half is -7%? That will be helpful. Sumangal, I think we'll stay directional. I mean, you know, we are not in the most easy macroeconomic times, so it is better to stay directional. The direction that we are giving to you, what I just said earlier, I think that we are having a very good degree of confidence directionally in that. Got that. Got that. I mean, given that all these things have bottomed out and the worst is behind, should FY 2025, we should see back, I mean, a normalized year, volumes around 3.8 million tons-3.9 odd million tons? Or any particular segment you see could be still a drag in next financial year? Yes, Sumangal, we have a lot of confidence in the overall growth of aluminum. We've been saying, we forecast, you know, forecast for aluminum, that whole premise growth is still at 4% on an annual basis. I think we're in the right, we have the right portfolio, strong confidence in growth in beverage packaging. A little bit mixed, probably going around the world, but we'll be growing off the levels that we're at today. You know, we have, you know, just as everyone else would, you'd have caution around, you know, continued higher interest rates, if inflation doesn't get under control, does that ultimately drive a different consumer behavior? As we sit here today, we have confidence, you know, in continued recovery off of, you know, our low point in beverage packaging, strong automotive, strong aerospace, and really a remarkable stable specialties products overall. Starting to see some signs of recovery in housing, which is helping the building and construction. You know, our capacity, you know what our capacity is. It's just over four million tons. We won't get into guidance next year, but a lot of positive signals out there. Okay. Got it. Thanks, Steve. My second question is with respect to a few other details, if you could, just help us understand how are the scrap spreads shaping up? How are we seeing energy prices and inflation on other items versus hedged levels? Yes. On scrap, we feel really good, Sumangal, from the point of view of availability, spreads, there is no single pocket of any disruption, thankfully. Metal prices and premiums aren't great, just something to keep in mind. Otherwise, from the point of view of availability and spreads, we are in good times. When it comes to energy hedging, for the second half of this year, we are hedged into the 70%. We don't have too much open exposure. Spot prices are kind of okay, not too bad. For a certain part of the year, we have also been benefiting from lower spot prices. Right now they are a little bit elevated, all within a certain zone, which is not very bothersome. On the whole, I think we have tried to take out as much uncertainty as we can on some of these open fronts. That's what I would say. Got it. That's very helpful. Thanks, and all the best. Thank you. Thank you. We have our next question from the line of Satyadeep Jain from Ambit Capital. Please go ahead. Hi. Thank you. A couple of questions. First on Bay Minette, just Steve and Dev, two years ago, compared to two years ago, when you outlined the expansion and the return expectations, just want to see where we are compared to those expectations. There is some capital cost inflation. What has led to that, given where we are you confident that the new revised 2.7, 2.8, the capital will be within that? Is there any revision to timeline for commissioning? Also, you've contracted more capacity, including the new Ball Corporation capacity. Given all these contracts, is there any change in the profitability estimate you had earlier, or the new contracts are also being signed at similar levels that were signed earlier? All of it ties to the return expectations on this asset. Is it fairly similar to what you had in mind a couple of years ago? Bay Minette, as I said, is progressing very nicely. It's gonna be a state-of-the-art facility, and as you've highlighted, about 2/3 of it will go to beverage packaging, and about a third of it will go to auto, roughly. We've contracted very well as we've put out in press releases, on the beverage packaging side, fully contracted. And we're progressing very well on the auto side with continued penetration of aluminum on automobiles, the right mix, growth of growth outlook, both in EVs and just overall build rates. You know, overall, we gave an update last quarter. You noted the inflationary impacts and the guidance of $2.7 billion-$2.8 billion and later 2025 commissioning of Bay Minette. Nothing changes there. I would just say that the all-in mix of everything that we have, both from the contracting side, from cost efficiency side, from the inflation and higher capital, we still are very confident in the mid-teens returns. Just on that, the new contracts you've signed, would be somewhat similar to the contracts you had signed maybe one year ago? Given all the demand slowdown we've seen, there's no change in pricing for those contracts. These are long-term contracts that were already signed. This is temporary slowdown for destocking. This isn't anything that's gonna drive rational pricing on long-term contracts. No changes in the view of the increase in prices. Just one quick question on the EBITDA per tonne that we've seen in North America. Is there any, seems to be some pricing benefit also. Tied to that, have you seen any pricing benefit also on new contract resets in this quarter, in addition to any inflation passing, any material, resets? Yes, Satyadeep, yes, you know, there is a benefit of better pricing. I mean, you know, we have been able to get a very good pricing on specialties. We have been able to get passthroughs, which we always told you last year, that, you know, they come with a bit of a lag. All that is in. You know, in specialties, we negotiate annual contracts, and as inflation is pulling back a bit, you know, some of these, you know, will be renegotiated in next year. Nothing to be majorly concerned about. I think that we will continue to see healthy pricing in the North American markets, almost across the board in all segments. Nothing really to be concerned. Nothing in these numbers, which is unsustainable, plus, minus, the adjustment of the passthroughs in a more settled inflation environment. In short, you know, if you are asking if there's anything which, you know, we should be kind of pulling out and calling out, no. I mean, it's all the normal things in the business which are on the positive side, particularly on pricing, and market recovery both. Okay. Thank you so much, and wish you all the best. Thank you. We have our next question from the line of Ashish Jain from Macquarie. Please go ahead. Mr. Jain? Hi, good evening. Hi. Hi, am I audible? Yes, please go ahead. Hi, good evening, everyone. Dev, you know, I kind of go back to the same question on EBITDA per ton. Can you give some more clarity on what has led to this swing in EBITDA per ton on a quarter-on-quarter basis? All right. Let's just compare the two quarters. We had a volume of about 880 kt, and from there, we came to a volume of about 933 kt in this quarter, right? You have basically a 53 kt change in volume. With that, you know, our EBITDA, which was around like $421 million, came to $484 million. We always keep telling you that every incremental ton that we sell in this business comes with a big leverage, and this is just a demonstration of that, you know? It's our point that we made in our prepared remarks also, both Steve and I, that, you know, incremental volumes come with a very nice, you know, operating leverage, and I think that's the simplest way to answer your question. Okay. The sequential, you know, decline, which implies from the guidance that Steve gave in terms of EBITDA per tonne, is all pertaining to the one-time cost, which will come in Q3. Is that the way to think? The way to think about it is that volumes will be a little bit muted by seasonality. Production will be lower because of some planned maintenance that we mentioned. You know, we will have a bit of a mutedness, you know, in the EBITDA between second quarter and third quarter, and so will be the case with EBITDA per tonne, therefore. Got it. Can you just highlight what is the update on the auto contracts for the balance one-third capacity at Bay Minette? What is the progress on that? I'm sorry, what is the question? Auto contracts. Bay Minette. Auto Bay Minette, yeah. We continue to have really good order book. You know, it's a process to go through contracting with automakers. As we talked about, there's very strong demand in the near term, fundamentals of aluminum conversions continuing at, you know, double digit. We've been talking about 11% compound annual growth rate over the remainder of the decade. Very, very, I'll say, very confident in our ability to fill the capacity at Bay Minette on the auto side. Yeah, Steve, as you speak, is any part of it already contracted, just to get the factual number? Yeah, I mean, auto is, you wouldn't think of it as an individual plant by plant necessarily, so it's a whole book of business. We continue to work that book of business. Again, we feel very comfortable that as we commission the plant in roughly two years, that we will have contracted the auto capacity at that point in time. Okay. Okay, got it. Thank you so much. Thank you. We have our next question from the line of Amit Murarka from Axis Capital. Please go ahead. Yeah, hi, good evening. Thanks for the opportunity. Could you provide the volume mix between auto, cans, and others? Like you shared last quarter, I think it's auto was about 23%-24%. Basically, can is in the high 50s. Auto is, you know, in the high teens, 19% or thereabouts. You know, aerospace is about 3%-4%, and the rest is all specialties. Got it. On the auto contracts, like following up on all the earlier questions. I believe on that one million in capacity itself, you have about a 75% or so utilization, and then you'll have another 200 kt or so to sell from Bay Minette. When you go into contracting of these capacities, would you like, prioritize Bay Minette, given that I believe it's a lower cost operation than your existing operations, or, how does it work? Yeah, you're absolutely right. We have one million tons capacity globally, a finishing capacity. At Bay Minette, we're not adding any finishing capacity, that is just gonna be the cold mill, hot mill that will then feed other finishing lines, such as our Guthrie auto facility or our Oswego auto finishing lines themselves. Right now, we are roughly, you know, about 70% of that capacity is being utilized, 70%-75% of that capacity is being utilized on a global basis, I'm speaking of. We think that over the next one-two years, that we'll have fully, we'll fully contract it and begin to ramp up with Bay Minette hot mill capacity and cold mill capacity coming into that system. Sure. Sure, understood. Also on the appraisal, under appraisal projects, I believe, you had put in some of the projects, like the project in China and others. Is there an update on that? No, we're still, you know, continuing to just evaluate the project in China, and expect to have a decision to move forward roughly in the next one year. We're just trying to pace capital for the most part here, with the significant capital spend that we already have put on the table. The same goes with other projects that were under evaluation in Europe and South America. Okay, got it. Thanks. Thanks for that. Thank you. We have our next question from the line of Parag Thakkar from Anvil Wealth Management. Please go ahead. Yeah, am I audible? Yes. Thanks a lot, and congratulations for a very good set of numbers. Thanks a lot for this opportunity. I would just like to ask two questions. One is, one person already asked that, what will be the profitability of the newly expanded capacity? Whether it will remain in this $500 per tonne range or based on your contracts, the profitability will further improve from here? That was one. Second is, can you say that, due to light weighting of cars, when, that inflection point will come where the aluminum use in auto will go up, even if auto volumes don't go up significantly? Yeah. On the first question, directionally, we will be more profitable with the new efficient production capabilities at Bay Minette and some of the very efficient brownfield expansions that we're making, too. We won't get into specific numbers, but that's directional for sure. We, we've said that in the past. On aluminum penetration, we're already seeing it because we try and stay away from build rates. Very much matters what mix, what type of vehicles are being built that have already started to adopt aluminum onto them. Larger SUVs, electric vehicles, large trucks, platforms, luxury vehicles, and so forth. We've seen the tipping point already, moving into these vehicles over the last decade and continue to see the penetration, further penetration, in competing with steel. You know, I think the move towards electric vehicles is very positive for aluminum, and that we're seeing aggressively in China, and other parts of the world as well. Again, we think the fundamentals of aluminum growth on auto vehicles is very strong. Again, around the 11% compound annual growth rate through the rest of the decade. Thanks a lot. One more thing, you said that your beverage can capacity, which is 2/3 of the new capacity which you are planning, which is, that is almost contracted, right? It is fully contracted. On the auto side, which is the remaining one-third of the new capacity, which is not beverage can, that you still have to contract, or that will be contracted when the capacity starts? Well, no, we're in the middle of negotiations on several vehicle platforms. you know, so it's not as large a contract, so it's hard to give you guys precision here. We feel very confident that we will be fully contracted as we commission the facility. Capacity will be commissioned gradually by FY 2026, right? Right now we are looking at startup production in later part of 2025. Yes, there is a ramp-up. It will not all come day one, and you should think about that over the next couple of years. Okay. We can say that 2/3 of the capacity, newly planned capacity, is also fully contracted, and the margins will be equivalent or better than current margins? They'll be better. Margin? They'll be better. We're getting better pricing and the new plant is a lot more advanced and efficient plant. Okay, great. Thanks a lot. Thanks a lot. Thank you. You're welcome. We have our next question from the line of Vishnu Kumar A.S. from Avendus Spark. Please go ahead. Thanks for your time. I have a question on the North American can market, can demand this quarter. Between the Bud Light issue causing impact on the domestic can demand this quarter, and apparently, imported beers have actually gone up. I mean, our market share gain, or rather the volume growth, is it coming because we have shipped lesser volumes from Asia, so that is kind of replacing the domestic decline? If you could help us, help us understand on this. Certainly the market, there was impact of the Bud Light issue that occurred early late first quarter or early second quarter. I can't remember exactly the date. That's primarily just shifted around volumes to different players in that segment itself. And beer has declined slightly as a category in the year. Overall, we believe that the North American marketplace is, you know, flat to slight increase on a year-over-year basis this calendar year. We're seeing that in some of our volume recoveries. We do have higher shipments coming in from Asia to support the capacity that we have domestically on a year-over-year basis. Overall, we see the U.S. beverage packaging market is healthy and continuing to grow over the next several quarters. If you could spell out, I mean, on the beverage side, the top three, I mean, in terms of percentage of our volumes going to Ball, Constellation. Would Constellation be a reasonably decent number, or it's mostly with Ball? Any sense on this? In the North America space, we sell directly to Ball. We sell directly to a few of the brand owners. Primarily it's Coca-Cola, as we have announced, Anheuser-Busch and Pepsi. We won't break out specific shares by customer. Generally, when you ship materials, let's say, from Asia to U.S., would the margins be better if you manufacture within U.S. or shipping from Asia to U.S. would be better? Just to get a sense. Yeah, I mean, at the end of the day, we get the higher pricing that we've talked about because of the market conditions, but the logistics of getting it from South Korea into the U.S. comes at a higher cost, and we understand that. That's temporary, as we support our customers until we commission Bay Minette. Until Bay Minette comes in, what will be the maximum quarterly run rate that we can do? We have almost touched 390 kt in North America. What can be the number that we can get to until the plant comes in or beyond which you can't push the volumes? Well, domestic capacity is near its peak right now. We did talk about debottlenecking at both at Oswego, which is gonna contribute a little bit more. Sierre was primarily an auto plant, but it helps with the overall system, so we might be able to get a little bit more out of the system in the near term. Otherwise, we will have to support some of this growth with imports primarily coming in from our Asian operations. Understood. Just finally, on the working capital bit, we've seen a decline in prices and but still within the mix, payables seems to be a larger payout. Just trying to understand any specifics within the working capital, why we are still at a minus $350 million for the first half? I did not get the last part. Can you please repeat the last part, please? If you could help us understand, despite the pricing coming off in general, and we are still at a negative of $345 million for the first half in terms of the working capital, any specifics within the mix that is causing this number to be relatively higher, if you could help us understand? Even in terms of days, we have kind of come down in certain specific pockets. Yeah. In the first half of the year, we typically build inventory, and that is one of the key reasons why we lock up more working capital. We bring down payables during the first half of the year. I mean, this year, for example, we have brought down payables, because, you know, we are purchasing less metal, purchasing it to requirements. It is basically a combination of building up inventory, which we typically end up using between quarter three and quarter four, and second, some reduction in payables, and that build-up in payables will again happen in the later part of the year. That is how it goes, you know. I mean, first half of the year, we basically have a build-up. Second half of the year, we use inventories, and therefore there is release of working capital. That is the typical pattern. Understood. Thanks for all the rest. Thank you. We'll take our next question from the line of Kirtan Mehta from BOB Capital Markets. Please go ahead. Thank you, sir, for giving this opportunity. In terms of the beverage can market, we are saying that the demand has started to stabilize. How far we are from sort of achieving the trend growth that we are looking at around 3% annually? Would it take three, four quarters, or could it be faster than that? Yeah. You know, as we talked about, we believe the stabilizations there, the destockings behind us, it really is different by region. With the macroeconomic environment, geopolitical environment, there are some different consumer behaviors in the near term. We see that, you know, in Europe, in Germany, we see it in Southeast Asia, we see it a little bit in Mexico. So it's hard for us to give you a precise understanding of growth in the very near term. With that said, fundamentals, medium and long-term growth, we stand right by it, and we've always been at about just over 3% growth rates. That's what we've built our expansions off of, and we firmly still believe in those. The other guidance we have given is we do believe there'll be sequential growth in beverage packaging over the second half of this year. I think that's, you know, to be fair, markets are a bit choppy, and we have to be careful in the near term, but feel really good about the long-term fundamental, the medium and long-term fundamentals. Since we considered that the beverage can demand outlook is not very clear beyond near term, so does it mean that while we have a guidance of $525 for the Q4, but the guidance on the margin for the next year till the outlook or clarity improves on beverage can demand, would also be bit sort of hazy as well? No, no, I don't think there's haziness in our $525. I think we feel confident in the $525 fourth quarter. We've got visibility. I talked about choppiness as we get, you know, into calendar 2024, a little bit further into calendar 2024, just with some of the unknowns. We've factored in what we see in the marketplace today that we spoke of and still believe the sequential growth in beverage packaging and the $525 reaching the $525 in the fourth quarter. I wasn't questioning about the fourth quarter $525. Beyond fourth quarter, that is into the calendar year 2024, would the margin sort of remain at a similar level, or would it also sort of reflect the haziness of the beverage can demand that you are seeing at this point of time? Beyond fourth quarter. Yeah. The margins would remain. What we're cautioning a little bit about is can there be some choppiness in the volume based on various market conditions around the world. We're just not gonna give a lot of guidance in that kind of period right now. As we get closer to it, we can provide a bit more guidance for you. Again, kind of medium term, long term, the trends around sustainable packaging and the move towards aluminum continues to benefit the substrate, and we feel very good about the growth that we see over the medium term. Sure. One more question was about the aerospace. You mentioned that it's probably reflecting around 3%-4% of our sales mix and probably 5% in sort of the medium term. From the regional perspective, is the U.S. region primary beneficiary of this aerospace demand growth that we are seeing? Would it be more than 10% of the sales mix in the U.S. region? We, aerospace is a very global business, right? We have manufacturing, a plate and sheet both in Europe and in Asia, that's where we manufacture. We sell to the large OEMs, Airbus, Boeing, Embraer, Bombardier, and then also into Tier Ones, supply. That supply goes around the world. Obviously, where our plants are, we might be heavier focused into those regions from a supply standpoint, Europe and Asia. From the perspective of the strength of the aerospace, the Europe and Asia region is the one where we will start seeing the EBITDA strengthening as the aerospace margin and the sort of the volume strengthen. Is that right way to understand about it? Yes. As aerospace continues to as build rates continue to increase and we're able to capture more of that volume, it will be embedded in those two regions from our EBITDA profitability. Currently, aero European and Asia remains sort of lower than the last year range. This is currently also reflecting the strength of aerospace, which means that the underlying beverage can demand or the weakness is much higher, and it's getting partly offset by the aerospace strength in those two regions. No, I don't know. We are making it, I think, overly complicated by connecting beverage cans and aerospace. Aerospace and beverage cans are very, very different volumes. Right now, aerospace is really doing pretty well. So, you know, it's very difficult to kind of even sort of try to answer the two together. Aerospace is good. We don't have too much more capacity in aerospace left, right? Aerospace, basically, you know, it's an interplay between, you know, sort of selling aerospace and when the markets in aerospace are not so good, we sell commercial planes. Right now the aerospace markets are in a very healthy condition. And so we would continue to see the strength for all the foreseeable future. Beverage cans is what we told you earlier, the market is basically on a path back to recovery after all the destocking. Some muted conditions in Asia, in Europe, because of consumer behavior, given the current macroeconomic environment, we have to just see how all that goes into the next year. That's the only thing that is stopping us. Long term, very confident, our 3+% growth in beverage cans, we have all the confidence that that will happen. I think that's the best way to understand it. Thank you for this clarification. Just one more question, if I may. You have highlighted three brownfield projects which we are completing in FY 2024. What would be their collective contributions to volume and EBITDA during FY 2025? Any color on that could be helpful. Not much in FY 2025, because, you know, you're talking about the brownfield scale, the brownfield projects. All right. Basically, yeah, sorry. Let's take some of them, you know. Oswego debottlenecking, you know, we are commissioning this as we speak. That's getting commissioned. That will help us to get more hot mill capacity. As a result of that, we will improve margins because we will need to buy less hot band from outside. That would be the immediate benefit, right? That is going to be a margin contributor, and we will have more insourcing than outsourcing. As far as, you know, South America is concerned, you know, I mean, we are heading towards a capacity of 750. Markets in South America stayed a bit muted until recently, but over the next 1.5 years, well, let's say one-two years, we expect to start seeing the use of all that capacity that we debottleneck. In Asia, we are having some debottlenecking of about 50 kt of capacity. Again, I mean, right now, the consumer behavior in Asia, because of the macroeconomic environment, is a bit kind of muted. As we see, as we see consumer confidence coming back and the macro settling down, I mean, that capacity will get used up. It is also a bit of a capacity for the North American market. You know, we need to make sure that we have enough to be able to meet North American demand until the time Bay Minette is not commissioned. That's the way to understand how we will use the debottleneck capacity. Thank you. Thank you for this color, and all the best. Thank you. Ladies and gentlemen, that was the last question for today. I now hand over the call to Mr. Fisher for closing comments. Over to you, sir. Yeah, thank you. Thanks to everyone for attending the call today. I think our solid second quarter report really is a testament to the resiliency of our business and the strategy. I think as we talked about, it demonstrates the operating leverage we can achieve as we see these markets improve. Again, thank you for your support and look forward to sharing our Q3 results in early February. Thank you. On behalf of Novelis Inc., that concludes this conference. Thank you for joining us, and you may now disconnect your lines.