William Oplinger: Western Australia.
Molly Beerman: Sorry. [Multiple Speakers]
William Oplinger: [Multiple Speakers] You said, Brazil, but we should be accelerating Brazil too, because of external stakeholders, but Western Australia.
Molly Beerman: Western Australia. Thank you.
Lucas Pipes: Really appreciate all the color there. Best of luck. Thank you.
Molly Beerman: Thank you.
Operator: And our next question today comes from Lawson Winder with Bank of America. Please go ahead.
Lawson Winder: Thank you, operator. And good evening, Bill and Molly. Very nice to hear from you. Thank you for the update today. I just wanted to ask on just one other capital allocation question and then on the dividend. And I don’t know, maybe your slide on taking actions now might actually address my question. But just when you think about the dividend, would your recommendation be to the Board to change it in any way? Are you comfortable with the current level?
William Oplinger: Our capital allocation program really is not changing, Lawson. We’re going to continue to maintain the strong balance sheet. We’re going to make capital expenditures to maintain and improve our portfolio. And then when we have excess cash and no particular order, we’ll use it for portfolio actions, preparing for growth and returning cash to shareholders. The dividend is something that we speak carefully to the Board about and they would guide us in any changes there.
William Oplinger: And remember, when we set the dividend, we set it at a level that we thought was very affordable through the cycle. It’s not a huge dividend. But we said it at a time when our indebtedness — our overall proportional net debt had gone from $3.8 billion down to $1.1 billion. It’s crept up a little bit this year, but we set the dividend at a level that we thought was affordable through the cycle. And so that’s the thinking.
Lawson Winder: Okay. Fantastic. And then if I could just add — maybe ask one more question on San Ciprian to potentially get a little more clarity on what the path forward might be. But I mean, if those facilities run out. I mean does that imply then that, that subsidiary then we’ll have to enter some sort of bankruptcy protection proceeding?
William Oplinger: Lawson, at this point, I don’t want to speculate what happens when and if they were to run out of cash, what the task for us currently is to work with the unions and the government to try to get that to be a viable operation. And that’s what we’re really focused on. We have a dedicated group of people who are working with the various stakeholders and constituents to make it viable.
Lawson Winder: Okay. That’s very clear. Thank you so much for your time today.
William Oplinger: Thank you.
Operator: Thank you. And our final question today comes from Curt Woodworth with UBS. Please go ahead.
Curt Woodworth: Hi. Thanks, good evening. Hi, Bill and Molly.
William Oplinger: Hi, Curt.
Molly Beerman: Hi, Curt.
William Oplinger: Thanks for reinitiating coverage, but you did it [indiscernible] level, just to be clear.
Curt Woodworth: Let’s dig into that a little bit.
William Oplinger: We can, we got a while. So we can dig in.
Curt Woodworth: Okay. So here’s the question. So alumina is at $370 million, bauxite’s up, you’re saying you’ve got third of the way down on the $310 million of raw materials. You’re guiding to a tax expense in the first quarter of zero. So are you saying based on spot pricing for the first quarter, your earnings before tax is zero. Like I would have thought that at $370 million alumina, you’d have some tax expense in AWAC. And then correct. So how do I think about that? And then, again, just kind of what’s the cadence, I guess, as you see kind of the margin profile in the alumina segment? I know that you talked about trying to get costs down and mitigating some of the bauxite grade issues. But is there a glide path in the next several quarters where there’s more meaningful margin recovery for a given alumina price points?
Molly Beerman: So Curt, let me take the tax part first. You’ve followed us for a while. You know as our income gets right around breakeven, predicting taxes is extremely difficult. Looking at the jurisdictions where we’re paying taxes versus those where we’re fully reserved. So we are at that point where if we have a meaningful departure on tax, we’ll have to give you an update.
William Oplinger: Let me address the second part of the question or maybe the theme of the question, Lawson, part of the reason why we put the chart together that we’ve been very focused on here is that, we made $500 million in EBITDA in 2023. Everybody can see that. And at the prices and raw material level in 2023, that’s where we ended up. We have line of sight to near-term actions that are going to double that over the next, let’s say, two years. And that’s not banking on any type of metal market or alumina market improvement. If you then factor in where we were way back in 2022, which was not that long ago on metal prices, you can see the earnings just really accelerate very, very quickly. So we at Alcoa aren’t sitting here hoping for an earnings — for a market recovery.
