Good afternoon. My name is Jasmine and I will be your conference operator today. At this time I would like to welcome everyone to the GrafTech First Quarter 2014 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks there will be a question-and-answer session. (Operator Instructions) Thank you. I would now like to turn the conference over to Kelly Taylor.

Thank you, Jasmine. Good afternoon and welcome to GrafTech International’s first quarter conference call. On the call today is GrafTech’s Chief Executive Officer, Joel Hawthorne and Chief Financial Officer, Erick Asmussen. We issued our earnings release this morning. If you did not receive a copy please contact Marie Noar at 216-676-2160 and she’ll be happy to fax or e-mail a copy to you. As a reminder some of the matters discussed during this call may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Please note the cautionary language about our forward-looking statements contained in our press release, that same language applies to this call. Also to the extent that we discuss any non-GAAP financial measures, you will find reconciliations in our press release that is posted on our website at www.graftech.com in the Investor Relations section. In particular on this call we will be discussing for the periods reported the non-GAAP financial items of EBITDA and adjusted operating income. For your reference a replay of the call will be available on our website. At this time I would like to turn the call over to Joel.

All right, thank you Kelly. Good afternoon everyone and thanks for joining GrafTech’s call today. Today I will walk you through our first quarter highlights, give you an update on the rationalization initiatives and give you some details of our recently completed refinancing initiative, also provide a little outlook commentary and then I’ll open the call for any questions. Looking at Q1 results, total company sales were $281 million, up 11% over Q1, 2013. EBITDA came in at $33 million at the high end of our guidance range due to timing of shipments in our Industrial Materials segment. Operating cash flow for the quarter was $22 million which included $9 million rationalization and related cash cost. We are proud of the whole GrafTech team which has been working diligently to execute on our strategy, the actions that we have taken over last year and half to lower cost and realign our production platform have positioned to succeed in a very competitive global market. Our first quarter results demonstrate that we have the right plan in place and we continue to drive value for all our shareholders. In our Industrial Material segment sales increased 5% to $219 million in the first quarter mainly due to increased volumes. Adjusted operated income for the segment was $8 million largely due to lower graphite electrode selling prices compared to the prior year quarter. As discussed previously the global graphite electrode market remains challenging has resulted in a weaker pricing outlook for 2014 compared to 2013. However as indicated in our fourth quarter call prices appear to stabilize albeit at lower levels year-over-year at approximately 8% to 10%. Our order book today is currently about 90% firm and in final negotiations. The remaining 10% is mainly second half or one quarter to one quarter negotiations…

Hey Luke. Luke Folta – Jefferies & Company, Inc.: I guess first question. I just wanted I guess touch a bit more on the outlook for the year, nice deep dive what you are expecting in 1Q and 2Q looks little better. So you said that was hopefully due to timing of shipments?

Correct. So timing related to as we mentioned some of our refractory orders that are capital good buys by our customers sometimes wasn’t clear when they will take it and we have seen some of those go here in the first quarter and that was the main contributor to the timing of our customers in the Industrial Materials. And yes we continue to see the revenue growth but again fast developing markets in consumer electronics and depends on again how those end markets go but we are seeing some good program launches here in 1Q that will continue in 2Q. Luke Folta – Jefferies & Company, Inc.: Okay, so on the refractory orders was that something that was kind of scheduled in the second half in your view and that pulled forward to 1Q, is that how to look at it?

Not for the major order. Again the orders – part of those pulled actually from 2Q to 1Q, so not from first half, from second half to first half the 1Q shipment the customer wanted, we had it planned in 2Q. Luke Folta – Jefferies & Company, Inc.: I guess I am just trying to explore here you are doing quite better than first half than expected but the second half given that you reaffirm the full year guidance second half got implicitly kind of down so I was trying to get a sense of what the moving parts were there?

Mainly Luke as I mentioned in the comments we feel good about the rationalization, the cost reduction initiatives are on track. As I mentioned 90% of our book is firming up in negotiations. In 1Q you saw the benefit on price of carryover from the fourth quarter in the 1Q to the whole second half of the year begin to see the full impact of the new pricing and plus against as we caught around the book out in the product mix. In product mix both product itself and again the geographic mix were concluding the deals around the world. Luke Folta – Jefferies & Company, Inc.: Okay and the $3 million insurance recovery was that something that flowed through income?

Yes, yeah. Luke Folta – Jefferies & Company, Inc.: Okay, the IM segment?

Yeah IM segment exactly. Luke Folta – Jefferies & Company, Inc.: Okay. And then also can you give us a sense of what the volume trends have been so far and the demand outlook issue. If you look at the world steel productive numbers, Europe seems to be bouncing back pretty nicely. Are you starting to see that in your order book, can you may be just give us the volume numbers for the quarter the year-over-year changes that will come in –

Yeah come on with Q and then the Q will disclose it’s about 20% in Q1 Industrial Materials which is all products is up related to volume. So as I mentioned at the end of the year and once you call you volumes we feel pretty good about we’re seeing that when you look at our order book and you look at our shipment level. The volumes are at decent levels based on the market we’re seeing. The trend for the year is again 1Q is a solid quarter, 2Q again from a volume standpoint will be a good quarter. Second half again what we expect, we don’t expect any major pick up of the market from our volumes which is built in our guidance. We expect the markets to continue at reasonable levels 2Q in the second half. We are encouraged, if you look at our customers, our customers are taking again decent levels compared to year-over-year. So again the thing we’re gauging still at the second half is going to be where do the customers end up and we’re cautiously optimistic like they are, there is some good indicator, some good signs, but there is still some things we’re watching really talk about non-residential construction, it still makes the indicators are still there that is going to improve. But the underlying economy is looking much better. So again volumes, I feel pretty good about our volumes look going into 2Q in the second half of the year. Luke Folta – Jefferies & Company, Inc.: Thanks, Joel. One last question may be I am crossing line on this but just looking through the proposal by the state graph textbook, there is some estimates in there that talk about what could happen in terms of earnings generation from really changing up the strategy going for market share focus one of them I is something along the lines of increasing market share by 30,000 tons and that driving $60 million in EBITDA growth and I think there is a similar number 15,000 ton I think it’s easier from $4 million benefit there. Can you comment I have some view but can you comment I guess on, I guess how realistic you think that is, that’s something that could be implemented, if you run through those lines to the modeling at your end that’s the numbers you get in terms of earnings impact?

Yeah I guess look, I appreciate the comments and it has been very public, lot of information about that. And again all that stick to the public in the information that we’ll stay from our perspective and our strategy our first market we’ve been very price disciplined in our approach to the market. Now again we believe you can differentiate, you can create value for customer and we have a very good pricing discipline that we try to employ as part our strategy. With that you also have to take into account into the market conditions supply and demand and where you are, as part of our strategy. And we always try to do that and implement again pricing discipline in light of where market conditions are with supply and demand. And I guess first into the details of what you mentioned obviously is a lot information out there again. We try to be disciplined in our approach in pricing and our market share and that is part of our strategy as we continue to move forward. Luke Folta – Jefferies & Company, Inc.: Okay. Thanks a lot guys.

Hey Luke, thank you.

Our next question comes from the line of Edward Marshall with Sidoti & Company.

Hey Ed. Hello Ed? Edward Marshall – Sidoti & Company: Do you hear me?

Yeah. Edward Marshall – Sidoti & Company: Okay. So did you just say that you think that, you said volumes were up roughly about 20% in the quarter?

Yeah we look at the revenues within IM group referring to IM, the revenues if you break it down volumes and pare then up about over 20% in Q1 compared to Q1 last year. Edward Marshall – Sidoti & Company: Okay. So volumes are 20% the book is 90% just kind of curious to get your sense as to why pricing was going to be down 8% for this, for 2014 and just seems like the demand side seems a little bit stronger as we move into 2014 and when pricing was set. So maybe you can just help me parse those two things together

Actually absolutely if you back up in negotiation season last year which was again September-October time period, the market had already moved down. So when you began, you began at that level where the market was and I mentioned in our last call that we looked at where we were from the fourth quarter on pricing coming to the year the movement just from fourth quarter into 1Q was going to be around 5%. So here that 8% to 10% that I mentioned is the full impact of prior bookings in early 2013 where again price was down year-over-year 1Q to 1Q, significantly down in the quarter and again probably around 18% 19% in the quarter. So what we’re seeing is the impact of that and the average of what that 8% is so where you started the bid season, and this is what I said it’s encouraging to us that price has kind of flattened and bottomed is where you started it, it did move significantly you are at that bottom point. Now why are you at the bottom point, to the point volumes were pretty decent for us in the back half of the year and I said coming into this year that while we felt good about the booking the underlying volume even at that current level volumes will continue to be at a decent pace. So it wasn’t so much it’s just where you started in the bid season at the levels the price did move significantly from where it started as I mentioned 5% end of the year coming in to this year. Edward Marshall – Sidoti & Company: Where do you see spot pricing kind of starting develop now on as you start to fill out the book then?

Yeah again from a spot basis I think we’re going to review and we’ll look as we move into the second half of the year where spot market would be. Again most of our business right now that we’re booking is on the obligation that we negotiated here through February-March-April but I think we’ll be then looking at the spot market especially in the second half of the year and see if again supply demand if the condition of warrant, if there should be any movement on spot market and we’ll make that assessment here as we round up the book and get into late 2Q early 3Q. Edward Marshall – Sidoti & Company: So I mean to further extrapolate that then is do you think that pricing could go up without further provisions to capacity in the industry I mean I understand we’re at the bottom of the steel cycle but with constant pressure on pricing over the last two years the fact that the book has slowed up 90% that you are still seeing some, as we progress in the first half of this year we have seen some pricing degradation. Do you think that pricing is going to have to wait for further rationalization or do you think that this is just the nature of the cycle where we are?

No, I think Ed obviously the rationalization that we’ve done, the industry has done my view is hasn’t taken into account where you’re looking to the future booking and the supply demand equation, because remember given the order books put together even now those rationalizations are in process and not fully implemented and fully realized. I can get a better feel as we move into obviously the second half through 2Q and 3Q as we begin to look to 2015 where demand is and how obviously we see our order book, our utilization rate and what pricing do. And I said before the question is clearly pricing has flattened down in my opinion is will it be you or we recovery in that book fill for 2015. And in fact as I would determine that is something you did mentioned right the supply demand the rationalization where does demand go from here, customers that will determine where pricing goes moving forward. Edward Marshall – Sidoti & Company: Alright, now to be clear the $17.4 million, the $25 million in full year expense the rationalization related depreciation first is that assuming is that accelerated depreciation due to the – is that right just as you close those operations? And that’s excluded from the 150 to 180?

Correct Ed. Edward Marshall – Sidoti & Company: And then finally again on the discussions surrounding the proxy I just wanted to be clear is there any cost related to you I’m sure there are but are there cost related to GrafTech with the proxy fight and how long do you see that last?

Well there of course is cost associated with that proxy contest because we said we try to resolve this because of the distraction in the cost, there are cost associated with it. Our annual meeting is May 15. So obviously May 15th is when determination will be made on that context. Edward Marshall – Sidoti & Company: I see. Now could you – I guess you won’t quantify the cost at this point and will it be meaningful to say 2Q results? And then I guess secondly in the event that this carries forward past the May 15th deadline which sounds like it May will they go along at the same level I am just kind of curious?

Well two things. And again we didn’t call up the cost because our team done a great job managing the cost along with all our other SG&A cost in Q1 and Q2. From our perspective right now it will conclude May 15th. We do not see anything that would take us beyond May 15th at this pointing time. And again all those cost have been factored into our guidance that I’ve provided. Edward Marshall – Sidoti & Company: Thank you.

Thanks Ed.

Our next question comes from the line of Brett Levy with Jefferies. Brett Levy – Jefferies & Co.: Well long time no speak.

How is it going? Brett Levy – Jefferies & Co.: Not bad at all. You know I think the challenge that has sort of been held out there I think by Luke and others to this industry, is the entrance of new foreign competition and this has historically been a business where you guys have had, you and some your European competitors that had a quality advantage, a service advantage, a location advantage and that has given you some degree of price protection. And that sort of there is been a bit of a kind of an improvement in the foreign product and some inroads made. And can you just sort of give a little bit of sort of an update on the quality dynamic, the supply side dynamic kind of what you guys have done to battle because it seems like you’ve done a good job especially with the recent guidance in battling that competitive dynamics. But just talk a little bit about where they are? Where you are? How you differentiate yourself as an update?

I appreciate that Fred. Obviously the market over the years has had no new entrants into it, it had people who have been there and have expanded as you refer to both in India there is some expansions, obviously Japanese expand here in U.S. those decisions were made at the top of the cycle. So what you are seeing the industry fight through from a supply demand balance as we came off cycle of ‘08 peak down to the ‘09, ‘010 the cycles in the recovery of that so supply demand is out of balance. So the market is trying to work through that new supply that has come on in some cases in last year. How we try to differentiate in that and always have is obviously through our product quality that you mentioned and the innovation we try to bring to the market. And we still believe that you can differentiate in the shop you differentiate obviously not only through product quality but also through the service that you provide to the customer. The gap of that between the top tier guys there has always been pretty relatively close right. There is the Japanese and the Germans we’ve always been relatively close in that the quality in what we deliver and we fight over differentiating for different strategies of each count. Obviously behind that the gap has obviously gotten closer over the years but there is still is a gap obviously overall. One key thing we believe we’ve done going forward to keep differentiate is the backward integration into the needle coke. That provides us an advantage obviously not only to the cost structure to the cycle but also the key raw material now we can work and develop that raw material that goes into the electrode and…

Yeah, absolutely Brett. In fact again I have been very clear. Our focus right now is to generate cash and the balance sheet from operation and delever and get us to a three times EBITDA multiple right which we will see by the end of this year as we get there so, clearly focused short-term for 2014 is manage the balance sheet we wanted to get it back to below three times EBITDA and now we are focused in 2014 that’s why we talked a lot about initiatives of the working capital and bringing it to the right level we see. Beyond that obviously as we do that we will always look for growth initiatives again like we showed in the past if the right opportunity comes from both the technology that makes sense to us or improves our cost position and a core product we will always look at that. And again depending is time we will gauge and determine the next step but we are making clear here in 2014 my focus really is generating the cash, making use of that cash and make sure I get balance sheet to where it is so then we can access some of growth things like we have done in the past. Brett Levy – Jefferies & Co.: Sounds good. Thanks very much Joel.

Hey no problem Brett. Good talking to you. Brett Levy – Jefferies & Co.: Good talking to you too.

Our next question comes from the line of Dave Katz from JP Morgan. Dave Katz – JP Morgan: Hi, guys. Hope you are doing well. I was curious if you look back in the past the company had indicated on Engineered Solutions business that margins on a sustainable basis could be 10% or above that. The company hasn’t hit that yet I understand the first quarter historically is typically weaker due to the product cycle but looking beyond that on a more sustainable basis if an when do you expect to get to that 14% margin level?

Sure, thanks Dave. Yeah, as I said in comments you know Q1 came in as we expected relative to 4Q based on the seasonality in some of the new products that we are launching in Q1. As we walk to Q2 you know I said that look we see the improvement of 8% to 12% in the U.S. operating margin. You know we do a color on that about 1% to 2% of that will be some of those products start-up cost we saw Q1 will work their way off as we move forward. The other call it 2%-3% moving to Q2 will be obviously improved mix and increase revenues as the initiatives that I mentioned that we’ll launched in Q1 specially in the consumer electronic space we see more volume in 2Q. The second-half are targeting based on what we see right now is we will achieve in that 10% to 15% range in the second-half of the year and again for the whole year we still feel that average will be 10% to 15% as we go. It’s been frustrating I know are in business for three years but again I see the assets that we put in are starting to run, are starting the products, the prices are accepted by the market we’ll start to see the synergies in the operations in the second-half for the year. So again we are still feel good and yes as you know we’ve driven sales from a $120 million to the forecast this year is around $300 million on an absolute dollar basis the operating income is improving, if you have seen in the quality we expect on the business but again does that managing the cost guidance as new product introductions. Dave Katz – JP Morgan: And in 2015 do you expect both the revenue and the margin in that business to grow?

Well what we said as far as beyond 2014 is we expect yes, the $500 million is what we said publicly as far as ‘15 itself too early for us to tell but again from a trajectory, where we want to go with ES and what we talked, about the objective and we see the investments we’re making will start pointing us towards that $500 million revenue number. And we said that again that should be at a 10% to 15% and we’re expect maybe to higher into that range longer term as all the bugs are worked out. Dave Katz – JP Morgan: Okay, thank you.

No problem. Thanks.

Our next question comes from the line of Charles Bradford with Bradford Research. Charles Bradford – Bradford Research: Good afternoon.

Hey Chuck. Charles Bradford – Bradford Research: Yes how you’re doing? Couple of things, the data on the electric furnace output that we track which is 15 countries showed a 5.2% increase for the first quarter of just the EAS output. And which is better than the World Steel Association had for the countries that they cover which was 2.5%. You think this represent maybe a final turn up in the construction markets?

Again, I give you my view on it Chuck. Again our numbers for EAS in 1Q year-over-year are, again outside of China are again 2.5% to 3% of kind what we saw with our numbers. Again I don’t know if it represents a return on construction yet. Again and talking of our customers what we’re seeing they are still consciously optimistic of the construction turn in rebar structural products. We see the utilization rates of our customers still be at the lower level in that space. So yes we see still good opportunity when it does so that utilizations rates will go up, but again and to really Chuck from what we see if there is an impact of it. Clearly, it’s at a lower level as you know from where it can be when non-residential construction probably does kick in. Charles Bradford – Bradford Research: And on another issue with the political issues between the Ukraine and Russia. Those are the generally been pretty larger sources the scrap supply to places like Turkey would have been big EAS producer. Are we seen any signs of the Turks having difficulty getting raw material that might effect that EAS output?

Yes, you’re absolutely right about supply chain, but we have not seen any impact in the Middle East or Turkey from our perspective of who we serve as and the volume levels there or their operating rates. We’ve been seeing no impact from our perspective. Charles Bradford – Bradford Research: Thank you.

Yes, thanks Chuck.

Our next question comes from the line of [inaudible] Frank from Prudential.

Hey Frank.

How are you doing? Just had a couple of questions, a couple on the new revolver if you guys could answer. Are there other financial covenants, maintenance covenants on that revolver?

There are the typical leverage ratio and interest covenants. The leverage ratio is 3-to-1 on the debt-to-EBITDA and interest covenants 2.5 to 1.

Is that different than what the prior covenants were?

There are little looser, the prior covenants were 2.25 to 1 and then 3 to 1 on the interest coverage.

Okay. And then has the availability changed, I know you guys weren’t using the whole $570 million available. So is you are liquidity impacted at all by the smaller size or that was just capacity we’re never gone be able to use anyhow?

I think you’ve call with the latter the 2.25 was the limiting factor on utilization. So the decrease of size from 570 to 470 really has no impact it’s the leverage ratio that allows us more utilization and better liquidity.

So what was the availability as if the end of the quarter?

The end of the quarter was 206 and if we factor in with the new facility what it would be on an implied basis it would be 332.

Okay. And then I noticed you guys looks like you paid off the supply chain financing. Is that still available to you or is that not a source you’re gone use going forward?

We absolutely have supply chain financing as a source. We use when and as needed.

Okay. And then just last thing, can you just talk a little bit about the timing of the plant closure. How long that’s gone take how long it might be off what the cost might be?

Sure Frank. From a timing perspective, here in 2Q as I mentioned looks like this five year maintenance outage. It will take about I’ll call half the quarter. So call roughly 45 days is what we’re planning to do, to do the major maintenance and refurbishment of the facility. Having disclosed what that cost impact will be, but clearly it will have an impact on the operations as it will be operating for half the quarter. And again that was built into our guidance that we gave for 2Q. We factored in when we said we’ll be in the range of 30 to 40 we factor in that impact in 2Q.

So that cost has not been excluded from EBITDA, that EBITDA guidance is inclusive of that maintenance outage expense?

You got it, yes.

Thanks for your help, appreciate it.

No, problem.

(Operator Instructions). Our next question comes from the line of [Tyler Canyon] from KeyBanc Capital.

Hi, good afternoon.

Hey, Tyler.

Hey just how should we think about inventories as we progress through the rest of the year. I mean I think inventories were a little bit higher to start the year than I think we were projecting at least during the first quarter. And would expect those to kind of come down as we progress though the year naturally as you purge some higher costs but can you just kind of give us some thoughts there as to how you are thinking inventories will look as we progress through the year?

Yes, no problem Tyler. Again when you look at Q1 overall inventory looks like they didn’t change a whole lot in Q1. Behind it I’ll tell you we’re starting to see the IM inventories decrease. Obviously ES inventories pretty much offset that as they built with their higher revenues that they generate and the inventory to service that. So we’re beginning to see the impact behind the scenes on the inventory number. We would expect as you go into 2Q obviously again not much significant changes as again we’re still adjusting the rationalization and the move in inventory and where we are. But then in Q3, Q4 is where you will see the impact of the inventory. And again if you had to split it you will start to see in Q3 and then the majority or a good chunk of it has come in Q4 on the inventory reduction.

Okay, thanks. And then just on the, I guess one housekeeping item here. Where exactly did the insurance recovery flow through in the industrial materials segment is that above the line or was that below the line item?

Primarily in COGS above.

In the operating income COGS.

Great thank you.

No problem, Tyler.

There are no further audio questions at this time. I would now turn the call back over to Joel Hawthorne for closing remarks.

Thank you, Jasmine. Again I want to thank all of you for joining the call today. On behalf of the 3,000 men and women of GrafTech thank you for your interest, your participation on our call and Erick and I look forward to talking with you at the end of the second quarter. Have a great day.