Century Aluminum Co (CENX) 2008 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the fourth quarter 2008 earnings conference call. At this time, all participates are in a listen-only mode. Later, we will conduct a question-and-answer session.

Instructions will be given at that time. (Operator Instructions). As a reminder this conference is being recorded. I would now like to turn your conference over to your host, Ms. Shelly Lair. Please go ahead.

Thank you, Ann. Good afternoon, everyone, and welcome to the conference call. For those of you joining us by telephone this presentation is being webcast on the Century Aluminum website, www.centuryaluminum.com. Please note that website participants have the ability to advance their own slides.

The following presentation, accompanying press release and comments include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements relate to future events and expectations and involve known and unknown risks and uncertainties. Century's actual results or actions may differ materially from those projected in these forward-looking statements.

These forward-looking statements are based on our current expectations, and we assume no obligation to update these statements. Investors are cautioned not to place undue reliance on these forward-looking statements. For risks related to these forward-looking statements, please review Annex A and our periodic SEC filings, including the risk factors and Management's discussion and Analysis Sections of our latest Annual Report and quarterly reports.

I would now like to introduce Logan Kruger, Century's President and Chief Executive Officer.

Thank you, Shelly. Welcome the fourth quarter conference call. Joining me today are Wayne Hale and Mike Bless. Can we move on to slide number 4. We are managing through extraordinary and difficult times. The crisis in the financial and credit markets has led to a pronounced downturn in the global economic activity. The global market for commodities has deteriorated in line with the decline in the global economy.

Consumers throughout the developed world are retrenching in response to the downturn and severe shortages of credit. Governments have taken on the role of spenders and lenders. The aluminum industry has announced significant production curtailments, so far a total of 6.5 million tons per year of production cutbacks have been announced, of which some 3.5 million tons per year are in China.

This represents 16% of capacity, but many of the closures have yet to be implemented and further production curtailments must occur to offset declining demand. Our first priority at Century is to protect our existing business as we continue to believe in the long-term fundamentals for the aluminum industry are sound. Our focus is on preserving the value of our assets since we will emerge from the downturn with a strong platform on which to grow.

Grundartangi in Iceland and the U.S. continue to work well. We have the leadership teams at the plants focused hard on cash flow and we have a hold on all discretionary spending in the U.S. and Grundartangi. Grundartangi in Iceland continues to exceed its rated capacity and produce record amounts of metal. Iceland's political and economic environment has had little impact on Grundartangi, but the environment in the country will be difficult for the next years due to negative economic growth, inflation and unemployment.

Recent progress has been made in restoring stability in the economy and financial markets as financing packages have been put in place. Banks have been recapitalized and the foreign exchange market has been partially reopened. We continue to plan to aggressively implement restructuring actions across the Company to improve our financial position during these difficult economic times.

We have concluded the orderly curtailment of the remaining plant operations at Ravenswood in West Virginia and we are taking a critical look at all of our U.S. operations, which Wayne will detail later. We continue to look for opportunities to reduce costs across the Company and improve our liquidity position over time. The recent common stock offering will allow us to consider cost reduction and other alternatives including additional curtailments of production capacity from a greater position of strength.

If we move on to slide 5. Declining demand for aluminum products in developed and developing nations, increasing stocks on the LME and other locations and a general lack of confidence in the future economic conditions have combined to produce an unprecedented decline in the LME price of aluminum. The average price has fallen some 60% from a year ago to February this year.

The LME has been as low as $1,280 per ton cash recently. The U.S. market remains subdued and the (inaudible) premium continues to be in the $0.04 range. Inventories have been increasing dramatically since last fall, and now equivalent to 53 days of global demand, similar to the peak days inventory level at the last downturn in the early part of this decade.

Current metal prices reflect similar levels as we have seen in 2002, but as you all know, the cost structure for the aluminum producers today is significantly higher. We move on to Slide number 6. At current [primary] aluminum prices we believe at least three quarters of the global primary aluminum capacity is operating below cash break even.

While this has led to significant curtailments industry experts believe supply still outweighs weakened demand as confirmed be the increase in the aluminum inventories. We do not believe that the aluminum prices at these levels are sustainable. We are all but the very lowest cost producers are operating at a loss. But current prices could persist for sometime until the economy regains confidence and demands pick up, and we are planning our business accordingly.

We'll move on to Slide 7. During the last several months, the primary aluminum industry has responded to the declining metal prices. Significant production capacity has been curtailed or is scheduled for curtailment. 6.5 million tons of production capacity representing 16% of the 2008 global production capacity has been announced for closure in 2009.

I would like to note in addition to this, some 17 million tons of [aluminux] production capacity has been announced for closure as well. We believe more production curtailments in alumina and aluminum will be forthcoming. We continue to expect more cuts outside of China as the majority of the smelters continue to operate with negative cash flows.

Shanghai prices have stabilized at somewhat higher levels than the LME aluminum price mainly due to government actions both on the strategic stockpile and taxes. And as a result it is believed that production cuts in China will now slow. In the Western world, particularly in North America and Europe there is still a significant amount of high-cost capacity that we expect to see curtailed in the near term.

While this idle capacity will create an overhang in the market, a significant amounts of these curtailments relate to smelters that were nearing the end of their useful life and have outdated technology as in the case of [Soderberg] smelters, or we'll be unable to secure par at competitive rates in the future to restock capacity.

Could we move on to Slide 8. Practically all of the projects aimed at bringing new capacity on stream during the next several years have been canceled, suspended or delayed. As a result, we expect little new capacity will begin production during the next several years and sponsors of these postponed projects will not restart production until the confidence in the market returns.

I would like to note that the construction period for a major expansion or a new greenfield plant is generally several years. Obviously, this will be a positive for the commodity price when demand returns. Let's move on to Slide 9. This chart is really a discussion of urbanization and industrialization of developing economies over the long term. Per capita aluminum usage remains low in BRIC countries supporting the outlook for future demand growth.

There has been a significant increase in the Chinese usage over the last 20 years, but per capita consumption remains well below developed regions. Some economic data, economic growth in China has slowed recently. Industrial production in December was 5.7%, 12.9% for the whole of 2008. GDP was 6.8% for the quarter -- last quarter of 2008, 9% for 2008 total.

Most of the forecasts for 2009 are similar to the 5% to 5.5% range. Longer term, aluminum demand growth is expected to return as capital for developing regions such as China and India reengage on a path of economic growth and urbanization.

If we move on to Slide 10. As the rapid and significant deterioration in the industry conditions became evident, we began taking actions in the last quarter of 2008 to reduce our overall cost base, and Wayne will take you through these actions in detail. We believe the restructuring actions along with the recent equity offer will position us to withstand current market conditions and be ready to participate in the upside when conditions improve.

We continue to believe that iceland is one of the most attractive locations in the world for primary aluminum production. We are actively working with the government of Iceland to support an investment agreement, providing governmental support for our Helguvik project.

We have every expectation of seeing this project through to fruition, but during these challenging times we must put priority on the Company's liquidity requirements as a whole. As a result, new commitments have been reduced to a modest level. I will now hand over to Wayne.

Thank you, Logan. Let's turn on to Slide 11. Beginning in September, and then accelerating through the fall, we took a series of actions aimed at immediate improvement of our cash flow. We stopped all spending related to business development and other discretionary programs. Result of these actions is that our cash SG&A will be around $6 million per quarter in 2009. This is around a 35% reduction from 2008.

We also ceased all discretionary programs at our operating facilities as well. We've always maintained a very small salaried staff at our corporate office and at our plants. Nevertheless, we eliminated approximately 13% of the positions at the corporate offices and at Hawesville. We address Ravenswood as part of a larger action and I'll get to that in a moment. Capital projects were suspended, other than those few that were too far along to stop. We have set essentially a zero budget for capital in 2009.

Any spending that -- must be approved and it will be approved by me personally, and any spending that I do approve will only be if it's required to maintain the safe and environmentally responsible operations at the facilities. Logan has already covered the status of the Helguvik project, so I won't repeat it here.

Let's move on to the capacity curtailment. With the complete curtailment of Ravenswood we have now shuttered one-third of the U.S. capacity. This decision was regrettably the right one for the Company. It followed a substantial effort involving all of the plant's major constituencies to find a way to keep the plant open.

We were especially gratified by the involvement of the elected officials, and in particular the personal leadership of Governor Manchin of West Virginia. Regrettably these efforts were overshadowed by the continuing decline in the industry conditions. The plant is now completely shut down. We will maintain a small staff at the site to keep the plant safe and secure and the machinery in proper condition so that the smelter can be restarted efficiently when conditions improve.

Mike will detail this in the curtailment costs later. The situation at Hawesville is reasonably complex, and we have been spending a great deal of time working through the relevant issues. We have a new long-term power contract, the approval of which by the Kentucky Public Service Commission, is expected at any time.

In addition, we have a large and valued long-term customer who requires metal in molten form. Despite these factors, you can expect us soon to be taking some decisive steps relating to Hawesville's rate of production. Similarly, we have been working with our partners on the situation at Mount Holly, and we are in discussions with the power supplier with regard to how to make this plant more competitive in the current market situation.

As you'd expect, we also have been working hard with our partners in Gramercy and St. Ann's as well. At the present time, the refinery's is running at 50% of its capacity of the smelter grade aluminum. The chemical production continues as it benefits the plant economically. We will continue to assess the situation as it unfolds.

Lastly, I should point out that beginning largely in January we have begun to see some relief in our major operating costs, such as market-based power, [and as] for Grundartangi, coke and pitch for (inaudible)production in the U.S. facilities, and other key raw materials.

Let's move on to the next slide. It is critical during times such as these not to lose site of the importance of world-class operations. As you know, our first priority continues to be ensuring the safety of all of our people at our facilities and the responsible operation of all of our plants.

In addition, throughout this very difficult environment, our teams have been delivering exceptional performance. Though not shown on this slide, the U.S. smelters have all continued to run above available rated capacity. The team in Iceland has demonstrated why we believe so strongly in the future of this business.

The plant's output has continued to exceed our expectations as you can see from the slide here. Since the completion of the expansion program the smelter's production has been consistently above capacity. We have also seen the positive impact of continued improving efficiency and productivity in Grundartangi's results. I'll turn it over to Mike now to talk about financial.

Thanks, very much, Wayne. If we could turn to Slide 13, please, and as usual I'll reference in my comments the financial information that directly follows the earnings release so if you could have that handy, it will make my remarks easier to follow along.

Okay. On Slide 13, as usual you are see a portrayal of the current quarter versus the prior one sequentially, obviously Q4 versus Q3. Before we get into the Company's results, let me just take a step back and talk about what the market did. That quarter, obviously, Logan addressed it at a high level.

Average LME price, cash price for the quarter, Q4 was down 34% versus Q3. On a one-month lag basis the cash price was down 26%, and as many of you know who have been following the Company many our sales are priced on a one-month lag, so on that basis our realized average price per ton was down 27%, again, versus a 26% decline in the one-month lag cash LME. Turning to shipment volumes on the domestic side volumes were down quarter-to-quarter about 2%. More than all of that decline was caused by the curtailment at the line -- at the first line at Ravenswood in December.

Iceland was up 2%. And Grundartangi, if you've had a chance to look at the operating data at the end of financial statements produced and shipped at an annual rate of 276,000 tons for the quarter. We're obviously extremely pleased with that result.

So you put all that together, the price and volume data, net sales as you can see on the chart were off 27% quarter-to-quarter. Now skipping over to the financial information if you got it in front of you, going down to gross profit was off on a reported basis $185 million quarter-to-quarter. If you exclude a $56 million charge we took for inventory accounting to reflect the value of the inventory at lower cost of markets as required obviously under accounting standards gross profit would have been down $129 million, again, if you excluded that $56 million LCM charge.

The drop in price caused more than all of that decline in gross profit. Price took $145 million out of gross profit quarter-to-quarter. Going the other way, as Wayne explained, we have seen the beginning of some of the costs falling quarter-to-quarter. And let me detail a couple of those for yo0u.

As you would suspect, given the severity and suddenness of the decline, the costs which fell the most were those that referenced directly the metal price, and for us as you know those this [aluminide], Mount Holly and Ravenswood and our power costs in Iceland. And those costs in aggregate were down $22 million quarter-to-quarter. Gramercy Alumina, obviously, down in Hawesville, was down $4 million quarter-to-quarter, these are all favorable obviously Q4 versus Q3.

U.S. power costs $4 million favorable Q4 over Q3, and as Wayne said we have just now begun in the last month or two to see drops in raw material costs, principally carbon. Q4 was just $1 million favorable to Q3. Going back that's the first quarter in over two years that we have seen a sequential drop in carbon and related costs. And as Wayne said we expect to see more coming.

Continuing down the net income statement, SG&A costs $4 million for the quarter. That was after a $3 million reversal in compensation accruals. As you know the way a company like ours accounts for their incentive compensation is you accrue on an ongoing basis every quarter for what you think you are going to pay. Obviously, in though fourth quarter when it became apparent that those amounts would not be paid based on the Company's performance, we reversed those accruals.

Going forward, as Wayne said we're looking at ongoing quarterly cash SG&A of about $6 million and on a reported or GAAP basis about $8 million. Couple more comments on the income statement, net loss on [foreign] contracts, as you can see there the $13 million, almost all of it relates to the termination of our Icelandic krona, foreign exchange contracts in the fourth quarter.

Lastly, share count if you had a chance to look about 49 million common shares, 15.6 million preferred shares, though are basically common stock equivalents and as you are doing the numbers in the future, obviously you need to add the 24.5 common shares as a result of the common stock offering in the beginning of February.

If we could move on, please to Slide 14. Same format, just year, full year over full year. I'll just make some very high-level comments. Again, just talking about the market before we go in to the Company's results, the actual cash LME on average in '08was 3% lower than in '07, if you look at that on a one-month lag just down 1%.

The Company's average realized price per ton was down 2%, that's excluding the impact of our cash flow hedges. As you remember, we were settling cash flow hedges throughout 2007, and then the last cash flow hedge contract settled in January of '08. So if you take out the impact of those cash flow hedges and look at what we actually realized on our pricing, excluding those hedging -- hedges, pardon me, our realized average pricing was down 2%.

Shipment volume domestic was flat year-over-year. Iceland was up 15%, Grundartangi shipping 271,000 tons, well above its rated capacity of 260,000 tons. I might add the first year after we completed the major expansion of that plant, that's an extraordinary testament to the folks at Grundartangi.

Net sales as you can see on the chart as reported, up 10%. If you pull out the impact of those cash flow hedges, net sales up 3% year-over-year. If you look at the gross profit, again, on the income statement data, if you pull out that LCM charge in '08, gross profit basically flat year-over-year.

Couple of comments on cash flow, if you have had a chance to look at the cash flow data further in the financial statements, free cash flow, $178 million in '08. Just as a reminder, the way we calculate free cash flow is cash from operations, minus CapEx, but excluding the Helguvik project spending. On that basis, CapEx in Q4 was $24 million, which brought it to $51 million for the full year. As you remember our forecast for the full year had been $75 million to $80 million when we gave you that forecast at this time last year, and obviously as Wayne said we stopped all of those projects other than the ones that were really too far in process to stop during the fourth quarter.

Helguvik project spending, as you can see on the cash flow data, $27 million in Q4 which brought it to $80 million for the full year. As you might remember, on the third quarter call we forecast $45 million of spending for Helguvik in Q4, and the rest of those amounts have been based on discussions with our suppliers for that project have been pushed out to 2009.

Those, were, again, amounts for work that had already been expended on our behalf, either in services or product. But those suppliers based on discussions agreed with us to push out those amounts, and I'll comment in a couple of slides on what we see for spending on Helguvik for all of 2009.

If we can move on, please, to Slide 15. Year-end accounting items. These were all detailed or estimates for these amounts, I should say, were detailed in the prospectus supplement that we put out in connection with the common stock offering. And the final results all came in within those estimates, but just to bring everybody current, first to look at the accounting for long-lived assets, number 1, PP&E, as we predicted there was no impairment as of the balance sheet date, December 31, obviously, of PP&E.

That obviously balance sheet date was a good month, a little bit more before we made the final decision to curtail all of the operations at Ravenswood, so we need to revisit that accounting this quarter. To put it into context, the current PP&E balance at Ravenswood as of December 31 was about $80 million. Goodwill, again, consistent with our estimate in the prospectus supplement. We did find impairment of that goodwill.

That goodwill, obviously, produced by the acquisition of Nordural back in 2004, and we have written off that entire amount.

Lastly, the largest amounts, obviously, our deferred tax assets with the Company at December 31 had over $600 million of deferred tax assets on the books, largely, but not totally, but largely, caused by the settlement termination of our metal hedge contracts in the middle of last year. As those of you know who follow this, most of you probably know the relevant accounting standards, you need to show in your forecasts that you can utilize a deferred tax asset generally within the next three to four years, or else it's indeed impaired and you need to put a valuation allowance or reserve against it.

Not surprising given the environment our forecast showed it would not be used, so we put a valuation allowance against most of the deferred tax asset. The only amounts that were not allowed are amounts that we'll go back and file our carry back claims for, and thus use, and I'll get to that in a moment. And the lower custom market item for inventory I've already covered so I won't go through it again.

Turning, please, to Slide 16, some comments on the balance sheets and the Company's liquidity. Cash, if you had to chance to look at the balance sheet at December 31, was $144 million. That had grown to $156 million at January 31. Of that $156 million, a little over half of it was owned by the U.S. Company, with the remainder owned by Nordural.

Just to remind you, we keep almost all of Nordural's cash offshore from Iceland in U.S. dollar accounts in Europe and the U.S. We keep minimal funds in Iceland.

So if you take that $156 million at January 31, and you pro forma it for two items, first item, obviously, is the net proceeds of the equity offering earlier this month, and the second, I'll get to in a moment, is the repayment of the $25 million that we had borrowed under the revolver as of December 31, and as of January 31, you'd get pro forma cash at January 31 of about $235 million.

On the revolver, we had borrowed during the fourth quarter under the revolver, the balance was $25 million at year end, and then again at the end of January. We borrowed that amount due to some issues we were having around timeliness of payment with one of our major customers. After a series of discussions with that customer those issues were solved, no issues today, and we have repaid that amount just this week.

The major reason for the repayment is due to the decrease in the borrowing base under the revolver for two reasons, one that has already happened and one perspective. The one that has already happened, of course, is the lower cost of market charge, that's a direct $56 million reduction to inventory carrying values.

The second is the prospective liquidation of working capital as we wind down the operations at Ravenswood. So when we ran the borrowing base pro forma for those actions, I should say, we believed it was prudent to repay that amount. If you were to look at it today, again, based on taking Ravenswood's working capital, i.e., receivables and inventory out, we believe we could reborrow that $25 million but no more. So that's the extent of the availability under the revolver.

As you know, we have no near-term maturities under any of our debt, and no maintenance covenants or any covenants of that sort. Lastly, on liquidity, two items to brief you on, again, we talked about this in the prospectus supplement. The first is the new power contract for Hawesville, we're waiting to hear from the Kentucky Public Service Commission any day now, assuming they do approve that contract, we would receive a $45 million cash payment upon its closing.

Second, tax carryback claim, again, produced by the loss that we took when we settled our hedge contracts. We filed for the first portion of that in January and actually received a check for that full amount just under $11 million late last week. And we're filing now the residual amount or $84 million, and under the statute believe we should receive those funds within 90 days of the filing.

Okay. Last page for me on slide 17, just a couple of items that we normally do to give you forecast items for 2009. Starting at shipment volumes, domestic, 375,000 tons, that includes Ravenswood operating with three lines for the month and a half for which it was operating. It also assumes that Mount Holly and Hawesville are operating at full capacity the rest of the year. So to the extent that we take capacity, for example, out of Hawesville that would reduce that number and we'll, obviously, update it for you at the time we would take any action.

Grundartangi has been producing, as I said, consistently above its rate of capacity, and so we feel confident in this estimate of 270,000 to 275,000 tons. Major pricing items, alumina, obviously, contract rate at Mount Holly is the same, LME percentage, obviously, '09 versus '08. At Ravenswood the contract rate is down '09 versus '08, and we'll use as much of that alumina at Ravenswood as we can at Hawesville and then sell the rest of it on the open market.

Power costs as we sit today, based on the forecasts from the power suppliers, looks like costs at both Hawesville and Mount Holly, '09 versus '08, about the same, maybe up slightly. That assumes that the Big Rivers contract, the new energy contract at Hawesville were to close. If it weren't to close, our power costs at Hawesville would be significantly lower in '09 than they were in '08.

And at Mount Holly, I should say we and our partners there, Alcoa, are having substantive discussions with the power supplier there about what can be done about those power costs. Carbon costs, as Wayne said, are coming down. We think the trends are good here, and we would hope to see continuing trend.

Cash spending for the curtailment costs at Ravenswood, $450 million in '09, we expect to get back in the near term, in the next month or two, a substantial portion of that amount in terms of the liquidation of working capital out of that plant.

SG&A, Wayne has already covered. $6 million cash per quarter, $8 million on a GAAP basis is our expectation. CapEx, as Wayne said, he's got no budget out to the plant operations personnel, and he'll personally approve any spending that's required.

For financial planning purposes we put in a budgetary amount of $15 million, we think that's on the conservative side. Helguvik spending, $25 million to $30 million for the year. Again, that includes, as I said, that approximately $20 million of supplier payments that we deferred out of Q3 and Q4.

And lastly, depreciation, $70 million, amortization, $16 million, that amortization were to go away, it would go away if the new power contract at Hawesville were to close, because we would write off the intangible related to that power contract if we were to terminate that one and enter into the new one. And with that, I will hand it back to Logan.

Thanks, Mike. We expect, slide 18, we expect the weak market conditions will continue through 2009 until stimulus of global fiscal measures and the return of more typical supply and demand equilibrium results in any meaningful increase in primary aluminum prices. Once global economic conditions improve the environment will be attractive for producers of primary aluminum.

The forces that were in place before the current economic crisis, industrialization and urbanization, will return. As described earlier, primary aluminum producers are generally responding to the current economic crisis by significantly curtailing production at existing facilities and suspending construction of new facilities. As a Company, we have taken significant curtailment and cost-reduction actions to date, and expect to see more in the near future.

We have also taken meaningful steps to improve our liquidity position so that we can emerge from this downturn well positioned to take advantage of stronger markets when they return. At this point, I'd like to thank you and invite any questions. Ann?

(Operator Instructions). And our first question is coming from Kuni Chen from Banc of America. Please go ahead.

Hi, good afternoon.

Hi, Kuni.

Hi. Tough times folks, certainly sympathize with what you are currently going through. My first question, I think in the prospectus it mentioned that you guys would be cash flow break even at about $1,900.

Can you give us an update to that sensitivity, assuming the -- baking in the full curtailment now of Ravenswood and where that could go if you curtail a couple more pot lines in your system?

I think to start off that number, I think is now a range of $1,800 to $1,900, Mike could comment as well, and obviously, Kuni, I think you are aware from this presentation and other perspectives amongst other things that we are looking very seriously at what we do in our other businesses. We have already reduced with our partners at Gramercy and St. Ann's as of this month down to 500,000 tons of smelter grade alumina, and a total of 700,000 with chemical grade and these actions are coming through.

So we hope the trend will continue to go down, but it's difficult at this stage with all of the materials costs and other things to really give you a fair number other than the range of about $1,800 to $1,900. Another comment I would add, Kuni, is Mike made a comment about Grundartangi being at today's cash prices being break even. We believe the team is going to get better than that, and they obviously are working very much on that as well. I don't know if Mike or Wayne would like to add any comments?

Kuni, it's Mike. Ravenswood, as you know, was a little higher than the weighted average, but not much, as we talked about in the past. Obviously, Ravenswood, smaller plants, smaller pots, older technology but a pretty decent power price. So when you blow that through and compared it to our other smelters, it was a little higher, certainly higher, but not a standard deviation higher, so that's a long-winded way of saying the weighted average break even has dropped a little bit as Logan said, but not a whole lot.

And we'll update this as we move forward to the extent that we would curtail further capacity, but I think it's fair to say you should not expected that break even point to drop very much, and just to emphasize, the break even here we're talking about is a consolidated break even. It's not just adding up the plants, but it's adding on the SG&A and interest expense, basically the overhead at the corporate level.

I think just one other bit of information, if you want a sort of idea of what we have seen flowing through. I think Mike and Wayne the cost at (inaudible), for example, taking the average of Q4 going through to -- January has improved somewhat, we have seen some of the prices come off?

That has actually improved 7.4%.

So Kuni we are seeing it. There it is a bit of a lag on this, but it is certainly starting to flow through. But I think Mike is correct in saying we expect some improvements, but they are not large on the down side.

Right. Okay. And then just as far as some of the other liquidity items that you talk about. The -- I guess just first of all, the $11 million tax refund is that kind of baked in to that 235 liquidity?

No. No. That was pro forma. Good question. The 235 was pro forma as of January 31, and the $11 million we just received last Thursday of Friday.

Okay, so we should include that. As far as the other items on Hawesville, and the other piece of the tax refund, can you give us your best guess as to when those items will show up?

Can you do Hawesville?

Again, this is Wayne. In regards to Hawesville, as we said earlier we expect the KPSC to make a ruling within the next several days, and with that ruling then we would see that flow of the $45 million shortly thereafter.

On the tax claim, Kuni, as I said, we are filing it literally as we speak here, today, tomorrow kind of thing. Because you have to have your 2008 return done before you file a claim against prior years. And the statute says the service is supposed to pay it within 90 days.

I mean that's what the law says, but it being the government, they tend to do what they want. The only remedy that we have, as we understand it with our experts, were they not to pay it within that 90 days, is that they have to by law begin to accrue interest on it. So we believe we should receive it, but until we do, again, the further $84 million, we're not going to count it as money in the bank.

Okay. And I guess just last question. I'll turn it over, and this kind of paints maybe a little bit more of a dire scenario, but just hypothetically, if all of your U.S. operations were shut down at some point, can you just sort of walk us through the cash flow indications of that? Would that be another $100 million or so of cash exit costs, if you could just kind of outline that for us?

Kuni, it's Logan. It's quite difficult to take you through that because you have to deal with a couple of fundamentals. One of the fundamentals at Hawesville is that we've got a very major customer with a contract for conductivity metal through to 2011 and that basically absorbs the best part of three lines. So you are going to have to take it, obviously, at Gramercy, St. Ann's we now are down substantially, but we have a partner.

At Mount Holly, similar situation, the partner as you know is Alcoa, and Alcoa has certainly shown real drive to take off capacity where it's not needed, and where it's not relevant in terms of return. So I think you have to take, if I can, some idea of what Ravenswood would have done and say that gives you an order of numbers. I'm trying to get my colleagues to nod in agreement what I'm telling you. I think that gives you some order of numbers, and we'll, obviously, as we go for our next call update you.

Yes, just to restate what we said about Ravenswood, so $40 million to $50 million of cash spending this year, and about half of that, again, in 2010. This year we'll get -- of the $40 million to $50 million, our estimates, say we'll get back, as I said, a good chunk, at least half of that within the next month or two, the working capital gets liquidated very quickly. So that's Ravenswood.

At Hawesville, the situation is is a little bit different. The contracts are different, and it's a slightly bigger plant, but from an order of magnitude, it would be around the same. Mount Holly, again, is quite different.

It's a not a represented plant, but there are payments due to the employees. There are demand charges for electricity. So it would be within the range consistent with Ravenswood, as Logan said, the [doability] of either of the two of those is really the issue.

And I think, Kuni, just on the last piece, just standing back on the high level on liquidity, you, I think, understand our position, and the way we set this up is to take us well into the second half of next year or more, so that's what I'll be working towards. Obviously, it will depend on how the market treats us going forward.

Thanks. I'll circle back.

Thanks, Kuni.

Thank you, Kuni. The next call is coming from the line of David Gagliano from Credit Suisse. Please go ahead.

Hi. Good afternoon, thanks very much for taking the calls -- or the questions. First of all, I just want to clarify, just to make sure, the $56 million lower costs or market inventory charges, that actually flowed through the cost of goods sold line on the income statement in Q4, is that correct?

Indeed, yes, David.

Okay. So if you strip that out it works out to about cost of goods sold of about $0.87 per pound shipped. And tying into the previous question, it sounds to me like we should expect that number, unit cost number, that $0.87 per pound number, to be below $0.80 per pound as we move through 2009, is that right?

Yes.

Yes.

Does that start in Q1, or is it a slow transition now that Ravenswood is shut down?

David, that's hard to -- it's Mike -- it's hard to estimate. I would say, your $0.80, I assume you are just picking up on the range that we gave on the break even?

Yes and trying to --

You got to be careful here. I mean, a break even, remember, is a break even at that metal price. It's a bit of a circular reference, because it assumes to the extent, for example, that you have costs that are indexed to the metal price, that it's at that price.

I mean you are calculating. You are just dividing our cost of sales by (inaudible) at a static piece -- a -- a point in time. Right?

Correct. Right. Right.

Yes.

So what you are saying -- but the break even declines as the metal price declines. Is that effectively what you are saying?

Yes.

Particularly if you are taking third-party aluminum.

Absolutely.

Sure.

But at a $1,300 metal price what is your cash break even? Is that $1,800 to $1,900 range or would it be lower?

It's a lower.

It would be lower.

I think my colleagues will correct me, David, I think we used about $1,400 to give you that range on calculation. To get to $1,900, around about $1,400 or less?

Okay. Fair enough. I guess we can talk about that a little bit more offline.

Thanks, David. Any more questions?

No. No, that's it, that's perfect. Thanks.

Thank you, David. We also have a question from the line of [Mark Anthony Savantis] from Perella Weinberg Partners, please go ahead.

Hey, guys. It's actually John Hale. Looking at slide six, which I guess is your industry kind of cash costs?

Yes.

Can you just provide some color in terms of some of the key underlying assumptions here and the timing in which you put this together? Because, obviously, this curve shifts as the dollar moves and raw material costs and shipping costs and all this sort of stuff changes. So could you just provide a little color here?

I think, John, it's fairly recent. Shelly can you --

Yes, it was produced in January of 2009 and the key assumption is the LME price, obviously, that drives the alumina and the assumption in there is $1,500 per ton. The line is showing the forward curve, the assumption that builds that curve is $1,500.

That's pretty recent, but obviously, these things change pretty quickly, John.

Right.

Right, but as the dollar continues to strengthen, I guess, a lot of this Chinese-Russian capacity becomes more competitive?

You are quite right.

Sure.

You get the currency impacts. Those, obviously, were taken into account at that time. As those currencies erode, I think you are just changing positions on the curve, really, from overhang. I don't think the -- who is making cash versus not making cash is going to change significantly, quite frankly.

Okay. And so how do you explain more folks not taking capacity out at these current LME prices? When do you think we're going to see -- we have seen 16%, but clearly that's not enough. When do you anticipate some more dramatic, drastic cuts from some of your peers?

I think they -- they've all done -- have been considering this for sometime. I think the pressure on the decisions have become more, stronger in any last while. I think our focus on perhaps two areas and maybe comment on some other areas of the world. The first two areas in North America and Europe. I think just recently in the couple of days -- in the last week, John, you are seeing numbers and announcements come out in Europe, Norsk Hydro, Trimet, amongst others. I expect you will see more.

It's somewhat unclear beyond the, I think 11% production cut at [Roosall] whether we'll see more, but they are certainly some of the older operations there would, obviously, be under consideration. But you've got foreign exchange impacts,or currency impacts. On North America, obviously, we have been quite open about our thoughts on some of our operations, and we'll be looking at those.

I don't like to comment beyond that on any individuals, but certainly I think the pressure is there. I think the pressure has also going through to a place -- as you noticed today in Mozambique, that there has been cost cutting in Mozambique, although that's not I would think with its favorable (inaudible) rate and cost of labor, particularly, should be fairly low, but there were cuts in production there. So I think this is slow to come.

I think this special -- we have been in this phase of pricing for about five months now. It doesn't -- it sounds like we have been here for a long time. But if you really think about it it's was probably November, really, where this would have been, so it takes a bit of time for people to see it. Part of what hasn't flowed through into the actual production is people have timed their shutdowns.

I don't want to give examples, but people are bringing off of their productions, say, at the end of March. Announced it but -- but the metal is still flowing til the end of March because they are running down inventories and their working capital amongst others. So I think there is more to come. It has to do because the demand, which is difficult for anyone to estimate, is not there. And you see that with inventory growth, so it is a disconnect between supply and demand.

Okay. And how does the decision-making process work at Mount Holly, and maybe Gramercy, in which you have a partner? How does that work and what are your obligations to funding losses and -- you know?

I think the answer is we have a partnership, these obligations, and we really don't like to comment other than we have got two good partners who we're working with. You have seen the results already at Gramercy and the discussions at Mount Holly are ongoing. I just note that Mount Holly is also one of the newest smelters in North America as well. It's a [par] process fundamental to that and Wayne, I think, and Mike made remarks about the discussions on the [par] contracts.

But do those operations have their own source of funding? Or to the extent they are incurring losses, are you obligated to contribute cash -- your portion of the cash needed to fund the loss-making operations?

It's the latter.

So you have no ability to -- to not contribute cash in lieu of giving up equity or your -- portions of your ownership interest in those assets?

I think there's a lot of options available to us --

We're looking at them all.

Exactly.

I mean, to answer your question, effectively not unilaterally is the answer to your question. Not unilaterally.

Thank you.

Thanks.

Thanks for asking the question.

Thank you. And we have a question now from the line of John Tumazos from the company of Very Independent, please go ahead.

Hi, John.

One moment, please. John, do you want to start again, please.

I'm sorry.

Thank you. You now can ask your question.

Thank you. In terms of your sense of the market, how do you size up the big inventory deliveries like yesterday's 141,000 ton LME report? If you were to merely take the change in exchange inventories in January, and suggest that demand was 12.9% below supply, and February first three weeks is about 11.4% differential, despite the output cuts reported or announced.

Do you think a lot of the output cutsn't have been made, or do you think there's is off-warrant inventories migrating into the system or demand really down that much? It would seem to me that the investment funds got wiped out around September, and the auto suppliers were liquidating their raw materials more like November, and it surprises me you would still see these amounts of metal falling on the exchanges.

I think, John, the answer is it is all of the above. But taking it first step, people have now announced cuts, and we know of examples that the reduction will only be a fully effective in March. So that's part of it. I think it takes time for those to come off -- there may be some off-warrant stuff that people have (inaudible.)

But in terms of the that particular day, it's -- you could look at the individual LME warehouses, and the major inflow was Detroit, and so you can understand that. So I think all of these, your numbers you are trying to work out what the differential is between demand and present supply.

I haven't looked at those numbers in that form, John, so I can't comment, but I think there is still more to come to get both demand and supply in a closer order, and this being obviously -- anyone who has had stocks of any kind, as it has liquidated that, I think you have seen, so you get a combination of all of those, John.

Thank you.

Thanks, John.

Thank you, John. We also have a question from the line of Mark Liinamaa. He is with Morgan Stanley. Please go ahead.

Hi, all.

Hi, Mark.

Hi, Mark, how are you?

Good. Thanks. In China, there's been much discussion of power subsidies trying to support their industry through these times. Can you comment, are you hearing anything about that kind of activity?

I think the answer, Mark, is yes. But it varies by area. I think in my notes, I don't see a further large reductions in capacity in China, and one of the reasons is that. Two is the Shanghai exchange price is somewhat higher, supported by purchases on the strategic bureau by China as well, so it depends very much on the regions.

You have also seen [Yuanan] province off of to west has bought or funded 350,000 tons, and some new capacity came on in Mongolia, which is very near. But at the plant level, the present price in the Shanghai price at least more than half of the smelters in China, even at that price, they are still not making cash. That's the real issue.

So your view is that the power subsidies will maybe preclude further curtailments, but aren't going to encourage some of the stuff that is idle to come back --

Well, John, in China, all of the above. It will vary by area, it will vary by region. We monitor a couple of the provinces that we know quite well and through other sources we look across the board.

I think it's very mixed. You can find and get an update today, and that may change in some areas dramatically by the next couple of days.

Sure, and one question that -- I don't know if it is fair or not -- but just for the value-investor approach, you have one world class smelter in Iceland and then three that are maybe struggling a little more right now. If you decided to -- or if somebody decided to walk away from a smelter all together, and say that's it, doesn't make sense in the future world as we see it, what kind of cost is associated with that?

I think Mike outlined that basically with Ravenswood. But then you've got to answer the question --

The costs to keep it online.

Yes, you are going to answer the question are you looking at a curtailment or a full closure. I don't know if Mike or Shelley or anyone else wants to --

This is Wayne. You have got certain remediation costs that you would have to enjoy, and take that on, particularly if there are any issues with regards to ground water or soil. And that varies from smelter to smelter, so we can't say at this time what that would be.

I think, Mark, the reason that you -- you hardly ever answer that question in the real world is that it doesn't make sense to do that, A, from a -- preserving one's options standpoint. The cost structure, you are quite right, isn't competitive today. No doubt, not just of our smelters but of North America, Western Europe, other regions generally.

But one never knows in the future, and Wayne could speak with much more clarity and experience to this, but smelters have remained closed for many, many, many years only to reopen again profitably in the future. That's the first reason. The second reason, as Wayne correctly says, is that the costs are not only substantial but they are -- it's difficult to estimate them until you kind of see what you have got.

And so for all of those reasons -- but the first one predominantly, it just doesn't make any sense to kind of go down that road. The cost of preserving the optionality, fancy word, is not great after the first year or two.

The real point is that these facilities are very capital intensive. And so to the degree you can maintain it under care and maintenance for the time -- it becomes a swing smelter. It makes sense.

I'm more thinking about it maybe as even a theoretical exercise, because it seems to me that there's value in Iceland that maybe is under appreciated today.

I think so. I think the other thing, Mark, is you have got to look through this thing and put on a lens and what you think is a -- a price on aluminum may be in the medium to longer term. But restarting a smelter, you've got to also have power contracts with some sort of time period ahead of you. That's another decision point.

Sure, but --

I mean I any I made the point that those are closed down -- there are certain ones that are less likely to restart, and as we have seen in the Pacific Northwest, I think there are good examples of that, so there less likely to restart. One, from a technology, environmental [soderberg] and the other from the power contracts -- Wayne's point about after a period of time you are starting to incur costs that are difficult to estimate, perhaps, and then you need to have sort of a three, four, five-year period ahead of you, and some certainty around that.

Great. Thanks, and good luck.

Thanks, Mark.

Thank you, Mark. We also have a call from the line of Tim Hayes from Davenport and Company. Please go ahead.

Hi, good afternoon.

Good afternoon.

Actually I just have a quick question. Mike, I apologize. I missed a couple of the numbers that you gave on the sequential cost changes. I got the power, I believe, it was down $4 million sequentially, is that correct?

That's right, Q4 over Q3, Tim, yes, U.S. power costs were down $4 million.

Okay. And did you give alumina and then carbon as well?

I did do both. Alumina I gave as part of the -- all of the metal-based index power costs, so I lumped it in with the cost of power at Grundartangi. Contract alumina, of course, at Mount Holly and Ravenswood plus the Grundartangi power was down in aggregate $22 million quarter-to-quarter. And, yes, on carbon down just $1 million quarter-to-quarter. Most of the decreases that we have seen recently, as Wayne said, came in the month of January, so those, obviously, weren't reflected in Q4 results.

All right. Very good. That's all I have. Thanks.

Sure, Tim.

Thanks.

Thanks, Tim. Another call from the line of Tony Robson. He is from BMO Capital Markets. Please go ahead.

Thank you, good afternoon, gentlemen.

Hi, Tony.

Hi. Thanks for the great detailed presentation. It certainly makes a sell side analyst's life a little easier.

Thank you.

Two questions on the, I didn't copy down the current number of stock outstanding, please?

Sure. Let me give it to you in three pieces, as of December 31, which you'll see on the face of the 10-K and the balance sheet and the income statement -- 41 million shares -- pardon me, 49 million shares, common shares, 49.1 million to be specific.

15.6 million preferred shares, and as you know those preferred shares are essentially equivalent to common shares other than they don't vote. And then going forward you need to add in 24.5 million shares as of the first week in February, obviously, from the common stock offering.

Okay. Great. Then the other question, the -- when you quote in your first paragraph, the goodwill impairment charge, $94.8 million and the inventory write down, is that an after tax figure? And is there any tax associated with those figures, please?

Yes, I mean -- the answer on both, but for different reasons is that they are pre-tax -- there's no tax impact on goodwill, of course, goodwill being a non-taxed item. There is never a tax either benefit or expense associated with goodwill or the amortization of it or the write down thereof.

And then on the inventory side we are not giving the current and prospective environment a tax payer in the U.S., and don't expect to be one for the time foreseeable.

Okay. Great. Thank you.

Thanks, Tony.

Thanks, Tony. Another call from the line of Mark Pollack and he is with NWQ Investment Management. Please go ahead.

Yes, just if I may, looking at Q1, just sort of -- almost looking at it as if I would be looking at the back of an envelope so I'm not really fine tuning the numbers, but if we look at gross profit numbers in Q4, I assume that is the operating gross profit on just the current sales. So that was about $62 million in the hole.

What should one assume is sort of the implied Q1 numbers considering that, obviously, your price have come down even though some of your costs have, but -- because within of the things that I think one can intuitively sort of try to understand is that, if we actually shut down the U.S. operations, you will have, obviously, some future costs associated with restoring them.

But to the extent that the market does not improve from the current level, maybe there is the economics might still suggest that limiting those cash losses, at least will preserve the ability of the Company to hold onto a significant amount of that cash, and essentially -- even if they restart later on, the reality is the market conditions may change.

And at that point, it will be just part of any entity that would be facing an improved environment could do, restart operations. So in a sense is there a way still kind of to look at that scenario with the understanding that if prices don't change, isn't that still the most viable -- or at least it is a backstop as a potential option?

Oh, okay. Marty, there was a bunch of stuff in there. So let me answer your question on gross -- or cost of sales -- gross profit ,or I think implicitly cost of sales, and then we can talk through again where we are facility by facility on options regarding curtailment, partial or otherwise.

So first, I'm not sure I understood your question specifically about cost of sales on current operations. Perhaps what you meant is that --

I guess what we see in the numbers that you provided is Q4 --

Correct.

Net sales, it's basically ex all of the other charges and impairments we're talking about at the pure -- at the pure operating --

Yes. Okay. Now I understand. Thanks.

So in terms of the curtailment charges, Q4 only contained two items. The first is, you need to remember, again that $56 million inventory charge, the lower custom market charge. That is -- that gross profit number is net of that charge. And then perhaps to your question on the Ravenswood curtailment, we -- given that we had, as of December 31, only made the decision to curtail one line, there was only $2 million reserved and, thus, that blew through cost of sales for Q4 for Ravenswood.

You might have noted the 8-K that we put out at the time that we announced the full closure of Ravenswood, and we actually amended it to today, with the new information that we have talked about on this call detailing not only the cash spending that we would -- that we're estimating for Ravenswood for '09, 2010, but how that will be accounted for in the first quarter. We couldn't account for that in December, obviously, because we hadn't made the decision, it's so-called Type 2 subsequent event under GAAP.

So that's kind of just the factual answers to your questions on -- on -- I believe, any way -- hopefully on cost of sales. In terms of going forward, I think we've talked about our number 1 options and, two, status on discussions with customers and partners, are the two major constituencies at each Gramercy and Mount Holly.

And I think you could expect from our -- number 1 you have already seen it at Gramercy that we have taken down a significant amount of capacity, half of the smelter grade capacity is off, and as to whether we can go the rest of the way, again, those discussions are ongoing with our partners, and they are good and constructive discussions.

Mount Holly, I think, Logan spoke to the discussions there, or maybe it was Wayne. I'm sorry, I can't remember.

Okay. -- in the case of the Hawesville, though, the [par] contract, itself would change the economics significantly, enough that you would say that even at current price that would -- the economics would suggest keeping most of it running, but maybe cutting back its production rate?

No. No. No. It's not the power contract that, as Logan said, that's the major determinant in keeping Hawesville running.

It's our customer -- it's our contract with our major customer there that requires us to supply, requires us to supply, as Logan said, a minimum amount of molten metal to that customer, and that amount requires basically just about three pot lines, or 60%, there's five pot lines, it's linear, 60%. So that's -- that's the issue at Hawesville, not the power contract. As we've said --

I understand that. I'm just wondering in terms again if it comes down to the brutal case of economics, the [par] contract being more favorable is it significantly favorable enough so that while you can continue to supply most of that customer the actual operating loss would still be significantly lower than, let's say, what we might see at Ravenswood?

I'm not sure what you mean by favorable. We have just said, Marty, that --

I mean less -- more favorable, clearly, not as negative or not as -- again, I'm trying to understand the impact of that [par] contract on the economics on the Hawesville plant?

We have said here -- today, it's on the -- the chart and it's consistent with what we have said for the last year or two about that contract that -- that the pro -- the new cost under the new contract will be about the same to up slightly from what we have paid on a weighted average basis for '07 and '08.

Oh, I see. Okay. I unfortunately was just of on and off the call, so I didn't catch that piece. Okay.

Yes, Logan reminds as we said also that there's a one-time cash payment that we will receive upon the closing of this new contract of $45 million. That's not a repeating item.

Oh, I see. So essentially that could be reflected in that -- as that favorable number -- just spreading that out over --

Indeed. Absolutely. That payment was intended to make us whole --

Okay. I understand.

-- for what we would be giving up in terms of the very favorable contract that we have that expires in 2010. So that is -- I think that's a reasonable way to look at it as you just said.

And as far as Mount Holly it all comes down to what Alcoa will decide with its 50% interest?

I think it's -- it's a partnership thing we're both partners have to align themselves on the objective of -- but Alcoa is, obviously, taken some really tough decisions as you have seen, so in our discussions with them and with Sandy Cooper, the power supply, those are ongoing, and so, obviously, we will be progressing those as we can over the next couple of months.

Okay. Thank you.

Thanks, Marty.

Thanks, Marty.

Thanks, Marty. We all have a question from the line of Tony Rizzuto from Dahlman Rose. Please go ahead.

Thank you very much. Thank you very much for all of the detail too, it's helpful.

Hi, Tony.

Two questions, first on the industry. There has been a lot of discussion about the Chinese looking to build their SRB stockpiles, and I'm wondering is there a danger that this might give a -- maybe a false sense of security or complacency might allow more of these smelters that maybe are idled right now to restart? How do you think about that?

I think, Tony, that is a concern. There's -- there's -- there's an interesting corollary to this as well, and I'm going to look to my colleague Shelly to confirm. But it hasn't applied to the Chinese an import tax.

So with an arbitrage like you've seen on the Shanghai you could actually attract metal from elsewhere into China, and I think some of that has already happened. But, yes, that is a concern, whether you would restart up other the capacity, but then you have to go back down to the plants and say at that price, $1,700 a ton or 12,000 R&B a ton do those smelters still make money?

And the answer seems to be that a large portion of (inaudible) still don't make money at that number. So, again, it's it's -- it's -- it's -- it's a credit issue, it's ability, and then there's an element to the social production in China, as you well know, where the provincial governments, as you know, from my experiences there and others are the owners of these facilities. So there's a social element as well.

There work very strong on taking production off. Some of them new projects in [Morgelo] came on, again, the concern, I think you describe it quite well, and then does that put an overhang on a longer-term recovery of the commodity price?

Very difficult situation. Never would have thought we would be in this position, to be perfectly frank.

You are in good company.

Yes. No comment, Tony.

Yes. The only other question is -- all of my other issues have been discussed already, but are there any issues from a pension standpoint? Do you have any contributions to make as far as 2009?

Yes, the answer to that is, no, and we put some information, Tony, in the prospectus supplement about it, but I'll just tell you what it said. Sitting right here today the pension fund -- take a step back. The good news is we went into this mess overfunded, generally, so we don't have a catch-up already. We are underfunded today on the order of $30 million, $35 million, maybe as high as $40 million, somewhere in the mid-30s.

There are no requirements to fund for '09. That underfunded amount, if we didn't fund in '09 -- if we don't fund in '09 would have to be paid -- again, unless there's any -- either change in the law or unless we went to the PPGC and asked for some kind of special deal as people have done, but otherwise that amount would have to be paid over the years 2010 to 2012. So three years you'd have to [top] that up.

Okay. About the $35 [million-ish]?

Ye, use $35 million sitting here today.

Over this 2010/'12 period?

Correct. Yes, sir.

All right. Gentlemen, thank you very much.

Thanks, Tony.

Thank, Tony. We have one more call today and it's from the line of Scott Pearl and he is from Seneca Capital. Please go ahead, Scott.

Hey, it's actually Matt Milim. Hey, guys.

Hi, Matt.

So assuming you guys get the full tax refund and the Hawesville power payment, how many months of liquidity should we think about Century as having at current aluminum prices?

Yes, that -- it's hard to estimate. Logan, did you want to --

No, I think it's a good question.

Yes, I mean there's a lot of assumptions in there, but at the current time you can work this out, obviously, based on the statements that we made in the prospectus supplement. The Company is burning -- this was pre -- let's see -- let's see -- the closure of Ravenswood.

Just one line.

Just one line. So this would be improved. At that point in time the cash burn was around $20 million a month, obviously. That amount has declined, of course, improved, based on the closure of Ravenswood. So work it out, let's see another 84, 94 for the total tax plus 45, 135, 140, so it's going to be something in excess of seven, eight months, that kind of thing, I suppose.

Seven to eight months more than what you guys gave in the prospectus?

Yes. Yes.

So we're talking at least a year and a half?

I think I'll repeat what I said earlier. My colleagues can comment as they like. Our plan, Tony, is obviously to take us well into the second half of next year.

And remember the -- the math that was in the prospectus supplement and that we're talking about right now, assumed metal prices about where we are today, about $1,300.

Got it. Okay, great.

$1,300, $1,350.

Got it. Thanks, guys.

Thanks, Matt.

Thanks, Matt.

There are no further questions at this time. Please continue.

Thank you, everyone, for joining us today. And we appreciate all of your questions and time. Thank you.

That does conclude our conference for today. Thank you for your participation, and for using AT&T Executive Teleconference Service. You may now disconnect.