So what we are seeing now in the market, prices are not coming down, it doesn’t really change the prospects for this project. We continue to see it quite strategic for us. We have invested, as you know, heavily on the infrastructure in the past. So it just makes sense to complete this project as fast as we can.
Myles Allsop: Okay. But when is the best case in terms of seeing the new tons ramp up?
Genuino Christino: Well, we are — so we are on target with our €“ for the first phase. It’s 2024, I believe. So then you can double check here for me, but I think it’s Q4 2024.
Myles Allsop: Thank you.
Genuino Christino: Daniel? We can double check, Myles.
Myles Allsop: Okay. Thank you.
Daniel Fairclough: Sorry, I was just mixing my papers up there. But in the meantime, we’ll just move to the next question from Patrick at Bank of America. Please go ahead, Patrick.
Patrick Mann: Thanks, Daniel. Hi, Genuino. Two questions, please. The first is just about the inventory charges that you’ve taken out of EBITDA. Can you just talk about the thinking of what adjusted EBITDA? Can you just talk about the thinking there because it kind of feels then that we’re only counting positive margin sales in the EBITDA, right? Because we write down inventory taken out of adjusted EBITDA, put it in as an exceptional item. And then when you sell then for recoverable value in the fourth quarter, it’s going to come through at sort of zero margin or maybe slightly positive margin. So is that the right way to treat that amount? And then the second question is just on working capital. I think as a follow-up from Alan’s question.
So we’ve spoken about the $10 billion build. I mean is that all excess or high working capital because prices and volumes were good. I mean how much of that 10 billion should we expect to reverse in short? Is it the full $10 billion, or is there a portion that’s kind of structural? Thanks.
Genuino Christino: Yes. Patrick, first one, on the inventory write-down. I think what we are trying to do, and this is consistent what we have done in the past when the cycle turn as it is the case now. And IFRS, you have to basically mark your inventories at cost or net realizable values if that’s net realizable very slowly, right? So at the end of the quarter when we have this significant change, we go through all of our inventories and basically even raw materials, we convert that into finished goods and then we look at the prices that we believe we’re going to be able to sell. And to the extent that we believe that we’re not going to be able to recover the cost of inventory, then we write it down. We have these evaluations.
So that’s really what happened this quarter. And so it doesn’t really belong in the operations of quarter three. And that’s why and given the size, we are showing it separately so that you guys can have a good sense of the true underlying performance of the business during the quarter. And then going forward, you are right. So to the extent that we were right with our assumptions in terms of prices, then these tons, when we sell it, they will have zero contribution to our EBITDA going forward.
Patrick Mann: I suppose the point is that if we only did this at the end of the year, right your EBITDA would be $500 million less. But writing it down now and then excluding it from EBITDA and then selling it at zero margin next quarter. It never goes through EBITDA, if that makes sense. But yes, I mean, I understand what you’re saying in terms of write-downs are typically exclude it. So — and just on the working capital, the quantity to expect to reverse?
