Alcoa Corporation (AA) BMO 33rd Global Metals, Mining & Critical Minerals Conference (Transcript)

Key Points Industry and Company * Industry: Aluminum and alumina production * Company: Alcoa Corporation (NYSE:AA) * Conference: BMO 33rd Global Metals, Mining & Critical Minerals Conference Transaction Details * Transaction: Acquisition of Alumina Limited by Alcoa * Ownership: Alumina Limited shareholders will own 31.25% of the combined company, Alcoa shareholders will own 68.75% * Value: Enterprise value of approximately $2.5 billion * **Debt**: Alcoa will assume$300 million of Alumina Limited debt * Listing: Alcoa will list its CDIs in Australia for exchange between shares Transaction Justification * Opportunity: Small window of opportunity to complete the transaction due to favorable share prices * Benefits: * Alumina Limited shareholders: Premium on closing price, exposure to the entire aluminum value chain, access to new technologies * Alcoa shareholders: Greater exposure to upstream business, synergies, simplified equity story * Stakeholders: Doubling down in key locations, benefits for communities Growth Opportunities * Near-term (3-5 years): Incremental growth opportunities, smelter restarts, creep projects, and small growth projects * Long-term (10+ years): Breakthrough technologies (ELYsis, ASTRAEA, Refinery of the Future) Development Projects * ELYsis: Carbon-free aluminum manufacturing partnership with Rio Tinto and the government of Quebec * Next milestone: Starting commercial size sales in 2024 * Commercialization: Expected in 2026 * New smelters: Alcoa will not build new smelters without ELYsis EBITDA Improvement * Target: $645 million by the end of 2025 * **Actions**: * **Raw material costs**:$310 million improvement * Advancing competitiveness: $100 million cost reduction * Warrick restart: Additional 45x savings * Alumar restart: Incremental EBITDA * Kwinana curtailment: Economic benefits * San Ciprian: Improvements and support from stakeholders required Other Key Points * Secondary market: Alcoa is evaluating entry into the secondary market, focusing on ASTRAEA technology * Energy transition: Aluminum is critical to the energy transition, with increasing demand in electric vehicles and electric cabling * Gallium: Alcoa has significant gallium reserves but has not yet developed an economic extraction method * Permitting in Western Australia: Alcoa has received permits for continuing operations and is progressing on Part 4 permits for new mining areas