Good day, ladies and gentlemen. And welcome to the Ferroglobe’s Third Quarter 2017 Earnings Investor Conference Call. At this time, all participants are in a listen-only-mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions]. As a reminder, this conference call maybe recorded. I would now like to turn the conference to the CFO, Joe Ragan. You may begin.

Good morning. And thank you for joining the Ferroglobe third quarter of calendar year 2017 conference call. I’m going to read a brief statement and then hand the call over to Pedro Larrea. Statements made by management during this conference call that are forward-looking statements are based on current expectations. Risk factors that could cause actual results to differ materially from these forward-looking statements can be found in Ferroglobe’s most recent SEC filings and the exhibits to those filings, which are available on our webpage, www.ferroglobe.com. In addition, this discussion includes EBITDA and adjusted EBITDA, and adjusted diluted earnings per share, which are non-IFRS measures. Reconciliations of these non-IFRS measures may be found in our most recent SEC filings. Now, I will turn the call over to Pedro Larrea, our CEO.

Thank you, Joe and good morning, everyone and thank you for joining us on the call today. Before we go into the details of the quarter, let me provide some context into the current environment on our strategy as we move forward, towards the end of 2017 and beyond. So, if we turn to slide four, Ferroglobe delivered a strong quarter with results that exceeded expectations, we posted a quarterly net profit on an adjusted basis and delivered a significant increase in both our earnings and EBITDA margin performance. We delivered a 6% increase in revenues, 28% increase in adjusted EBITDA and our EBITDA margin improved by 212 basis points at 12.4% for the third quarter compared to 10.3% for the second quarter of 2017. Our strong performance is driven both by significant improvements in the external environment, as well as actions taken by Ferroglobe during the past period. In the external environment, and mainly for silicon metal improved prices and volumes are driven mainly by the market impact of the ongoing trade cases in the United States. In silicon-based and manganese-based alloys, we continued to see a strengthening of demand across end markets, and an improved supply demand balance in the different geographies. Combined, these trends have resulted in a sustained price recovery and continued stabilization of shipments and volumes although with different pace and timing depending on products and geographies. At the same time, actions taken in this and prior quarters, ensure we were able to fully capture the benefits of these trends, our commercial strategy then to enhance our profitability. So, in addition to general price recovery, we continued to focus on delivering contracts above spot and index prices. This strategy has been performing well for us, and together with the market recovery, has allowed for the…

Thank you, Pedro. Let's go to slide 15. Sales volumes was 223,980 metric tons for the third quarter, up 2.7% from the second quarter and net sales were $451.6 million a 6% increase compared to the second quarter. Average selling price across all products was $0.82 per pound, up on average from $0.79 per pound in the second quarter, up 3.6%. We posted a net loss of $5 million or a loss of $0.02 per share on a fully diluted basis. On an adjusted basis, our net profit was $9.2 million, or $0.05 per share on a fully diluted share. We reported EBITDA of $54.3, up from $36.8 million in the prior quarter. On an adjusted basis, EBITDA was $56.1 million, up 28% from the second quarter of 2017. During the quarter, continue to adhere to our strategy of realizing prices above the index, which coupled the continued strengthening of demand and improved volumes, resulted in a 12.4% EBITDA margin compared to 10.3% for the second quarter of 2017. Total working capital was $377 million and free cash flow was $52.7 million in the quarter, and $58.5 million year-to-date. Next slide. We ended the third quarter with the net debt of 394 million down compared to 435 million at the end of the second quarter of 2017. Our net debt ratio is continue to improve as profitability as increased sequentially. Next slide. On this slide, you will see our debt evolution overtime. On a quarterly basis, net debt was down from the prior quarter and currently stands at 394 million net and 584 million gross for the third quarter. As noted, the bottom of the slide all amounts have been adjusted to show the impact of securitizing the accounts receivable program. We remain committed to reducing our nominal debt balance, as well as improving our leverage on a go-forward basis. Next slide. We remain focused on carefully managing our cost structure and ensuring strict control in our operations. As you can see, we ended the third quarter with working capital of 377 million. Now, I’ll turn the call back to Pedro for some closing remarks.

Thanks, Joe. Next slide, in closing, Ferroglobe is capitalizing on its strong market position as we deliver quarter-over-quarter growth and improved profitability. We have taken decisive action since becoming a combine company to benefit from an improved market environment, but managing our cost structure. Identifying market and products and we’re experiencing and improve demand and pricing environment and executing our commercial strategy. And we are now experiencing sustained benefits across our key products. We expect prices to continue to improve in the near future and we remain focused on effectively capturing this trend. We are now well into the contracting season for 2018 and we are glad to see that we are being able to remain disciplined on communicating to our customers, our view of the market evolution. We are closing contracted prices above current index prices and have completely eliminated any discounts from our index based contracts. All-in-all, we expect the sustained performance across our business as we move into the end of 2017 and into 2018. We are glad with the trend of our business, but we remain commitment to improving profitability in the short and medium-term to return our financial performance to where we all expected to be. With that, I’d like to open the call up for questions.

Thank you [Operator Instructions] Our first question comes from Vincent Anderson, Stifel. Your line is now open.

Just real quick. What additional commentary, can you provide at this time with regards to 2018 silicon mill contract? So how far along versus prior years any color on mix versus floating contracts in North America and Europe. And then are you seeing any significant difference between the EU price discount versus the U.S., in your contracted terms versus what we can observe in the spot market?

We are right now somehow midway in the contracted season. So, we will continue to be contracting basically until the end of the year. We are in line with previous years. So, we have secured volumes that now represent -- and by the way this is of course talking about silicon metal, the other products have different dynamics, when we can talk about that. But talking about silicon metal, we have already secured volumes that are close to 60% of our expected total sales, both in Europe and the US. Now the proportion of fixed versus indexed is around nearly exactly 50-50, indexed and fixed price, and that applies both to Europe and the US. Just note that though that most of the indexed contracts corresponds to specific big chemical customers that have multi-annual contracts. In terms of where prices are, both in Europe and the US, prices are I would say $0.05 above where the index is today. So, we are closing prices in the US that are above $1.40 in all call cases and in -- $1.40 per pound. And in Europe, we are systematically closing all contracts above €2,200 per ton -- per metric ton which represents around $1.20, $1.21 per pound.

That’s very helpful. Thank you. So, you outlined at your Investor Day your plans to increase your base EBITDA by around 25% over the next two years. And I know there are a lot of moving parts to that. But it would appear that with the Glencore acquisition you are probably easily half way there already. So, do you still believe it will be two years to reach 25% or do you expect may be the total to be higher or the 25% to be delivered sooner?

That’s a very good question. We are ambitious and we hope it will be more and it will be sooner. But of course, as you say there’s many moving pieces. What I can say is first that at any given point in time, right now, we are analyzing several growthopportunities, that is one. And second of course is we are also developing new products and new technologies like solar grade silicon. And when we will see the full benefits of that is also, there’s some degree of uncertainty. So, there is now way I would commit to anything different to what we said in the Investors Day but we are ambitious and we hope we can certainly improve both the quantity and the speed.

Great, thanks. And if I could sneak in just one more. Is there any plan to restart the dividend next year following the debt refinancing?

Well that is something that we still have to review, this can be approved by the Board and by the shareholders.

Thank you. Our next question comes from the line of Ian Zaffino of Oppenheimer. Your line is now open.

Hi, great. Thank you very much. I just want to may be drill down a little bit on the dynamics of you guys and your customers and really why I am asking this is because you have the ruling in Canada that sort of went one way. And I think the fear is may be that the Canadian US boarder is somewhat porous and therefore may be some of the material would go through Canada and then come in to the U.S. Maybe you could help us understand, as far as your customers, I mean how important the securities apply to them, how important is it to have high quality supplier versus maybe just finding some stuff that's going to come over the border? And then I have a follow up. Thanks.

Well, first, what you've described so material that would be subject to duties in the U.S. and that could be imported into Canada and then into the U.S. that is I don't know the technical name for that. I know it, I don't remember it, but that is basically smuggling if I may call it that way so that is illegal. So, it wouldn't happen and I don't think it ever happened. So that is not really a risk. And in terms of your question, I believe that customers do value security of supply. And in our conversations with our customers that is a very significant criterion for choosing supplier. And we are very well positioned in that respect, and we're seeing that. We're contracting with big customers ahead of time and we are increasing volumes with some significant customers. So, I think yes, we are a preferred supplier in North America. I have no question about that.

Okay. And then I guess this is a question for Joe. We trying to model out Glencore here. And just trying to understand, I guess you're saying you've doubled the size of the business. And historically it's not as high as -- just the business is not as high as $20 million EBITDA roughly. Does that mean that Glencore is going to add of $80 million of EBITDA into next year, or how do we think about the contribution from Glencore?

It will double the contribution, that is the way we're thinking about it. There could be some margin compression next year. So conservatively I might go a little bit lower than $80 million. But the Glencore deal itself allows us to actually stabilize the spreads through getting better raw material cost as well as better pricing from our customers. So, doubling the existing run-rate is a legitimate way to model it.

Okay. And then one last question would be and maybe I think this is for Joe, is if you look at the EBITDA the business did this quarter. If you were to write that up to maybe where the market is because I know you have some legacy contracts that are still being sold at lower prices. If you were to write that up, what is the EBITDA actually look like for the quarter?

Well, I think that the consensus estimates would have at these normalized pricing today of around $100 million a quarter which will give us $400 million. But the problem with that Ian is it does not account for any cost increases. And we are seeing cost increases related to electrodes and some power costs increases as well that would bring that down. And so those are cost for next year. So, if we're trying to project in the next year the pricing would have it at $100 million but the cost would have it a little bit lower.

Okay, and that $100 million would be at the prices you're contracting at today.

Correct.

Okay, and then you'd add like Glencore on top of that?

That's correct.

Alright.

Our next question comes from Martin Englert of Jefferies. Your line is now open.

Looking into 2018, you just briefly touched on that, but can you discuss some of the puts and takes regarding the production costs including electrodes, electricity and anything happening with coal or other major factors, I guess, what you would think maybe incremental deltas would be your headwinds there?

Yes. And we’re looking at -- we talked about the electrodes situation several times already. And suddenly that is affecting costs significantly. And mainly that will hit costs from the second half of the year. And on our case fortunately, it will not have an impact on availability, but it will have impact on costs. And we see that has been probably some tens of millions of dollars. So, it could be $10 million, $20 million just from the electrodes additional costs. And then there is some additional costs in power, in France, part of the French contract subject to market prices and those market prices are up in France so we are having some additional power price. Coal is up right now, we will need to see how it evolves through next year to have a correct understanding of the full impact of that.

Okay. And for the power costs overall for the full footprint, including assets outside of France, would you expect that increase to be about 10 million or 20 million annually for 2018 or would that be something different?

I don’t have an exact answer right now, Martin, to be honest. So, let’s -- we’re still, I mean going through all the details. I’m not entirely sure, I cannot give you a detailed answer on that. But I’ll get back to you on that.

And one last one there. Just to confirm on the silicon metal annual fixed contracts that would be a proportional split about 50-50, both in the U.S. and European market. So that would be a bit of a step down, I guess from fixed annual contract mix that you saw in your calendar 2017. Is that correct?

Yes. That is correct. And as I was saying, the caveat there is that we are still halfway through the contracting season. So, to historic [indiscernible] the weighting, if you wish, of existing longer-term indexed contracts as of today is bigger, just by the fact that existing index contracts are there. So, we will see at the end of the contracting season what is the split.

[Operator Instructions]. Our next question comes from Sarkis Sherbetchyan of B. Riley. Your line is now open.

So, you mentioned the facilities in Argentina and South Africa are kind of underutilized here and it sounds like you’re planning to restart the full operations there in the near future. Can you maybe give us some thoughts around what near future means as far as the timetable is concerned? And then also if there are incremental costs associated with bringing those facilities online?

Well actually Argentina facility is starting up as we speak I would say and Polokwane which is the -- if you remember -- and in South Africa we have two running facilities which are Polokwane it’s 100% silicon metal and then we have eMalahleni which is running mostly on ferrosilicon and foundry products. The one that is -- again Polokwane now is running with one furnace under our two furnaces that need to start. Those furnaces are being started in January and February I would say as soon as we can. Given the logistics from South Africa we won’t see the benefits of those volumes until Q2 next year. Thus, I would think we are just restarting as soon as we can. In the case of South Africa entering our production base, it will actually have no impact on our average production cost because we have obtained or arranged a new power contract there in South Africa. With that new power contract and with exchange rate having moved slightly favorably, is now actually competitive vis-à-vis our European or North American plants. So, no impact in terms of production costs per ton.

That’s very helpful. And then with regards to the markets served, will that be geared for the European area?

Well we have some very -- one very important contract in Far East with -- at a very effective price and that will take around half of South African production. The rest of the South African production we will see where it is targeted depending on market conditions. That is the flexibility we can apply and it will be a bit on an ongoing basis we will evaluate where it goes.

That’s helpful. And then I think you mentioned in the silicon-based alloys business, the sales volumes declined on some unexpected downtime in facilities. Can you mention may be what that downtime is referring to and if that’s been resolved and if you expect the volumes to rebound here?

Yes, it was two incidents that happened. One related to some electrodes breakages in Bridgeport in the US and that was certainly resolved. And the other was in our Dumbria plant in Northwest Spain and that was also a technical incident that is resolved. So, both are resolved and volumes would get back to normal levels this Q4.

Just one more from me regarding the trade case in Canada. It’s sounds like you are trying to analyze the statement of reasons and potential appeal here. One, what basis do you have for appeal, if you can comment on that? And then two, may be if you can highlight the fundamental differences between the US case and the Canadian case? Thank you.

Well I cannot comment on what are the basis for appeal. We are still analyzing it and we haven't decided our way for what tells, so no comment on that. And well, the U.S., Canada, the European Union, they have just different processes and different basis of analysis. And part of the differences between the U.S. and Canada have actually to do with the way they look at injury, in the U.S., there is actually a preliminary analysis of injury before they go into the preliminary decisions on antidumping and countervailing, whereas in Canada they don't analyze injury until the end of the process. So, the fact is in the U.S., there has already been an analysis on injury and we are more confident that the final investigation will be positive because, again there was already a preliminary investigation on that.

Thank you. And I'm showing no further questions at this time. I'd like to hand the call back to Mr. Pedro Larrea for any closing remarks.

Well thank you very much. As I have said at the beginning of the call, we have presented strong consistent results in Q3 just as part of the trend of improving financials in our company and we remain very confident that this trend will remain going up in the coming quarters. And thank you very much for listening and attending this call. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. That does conclude today's program. You may all disconnect. Everyone have a great day.