Good day, everyone, and welcome to the fourth-quarter 2014 earnings conference call. Today's call is being recorded. At this time, I would like to turn the conference over to Miss Melinda Ellsworth, Vice President and Treasurer. Please go ahead ma'am.

Thank you. Good afternoon, everyone and welcome to Kaiser Aluminum fourth-quarter and full-year 2014 earnings conference call. If you have not seen a copy of our of our earnings release, please visit the Investor Relations page on our website at kaiseraluminum.com. We have also posted a PDF version of the slide presentation for this call. Joining me on the call today are Chairman, President and Chief Executive Officer, Jack Hockema; Executive Vice President and Chief Financial Officer, Dan Rinkenberger; and Vice President and Chief Accounting Officer, Neal West. Before we begin, I'd like to refer you to the first two slides of our presentation and remind you that the statements made by management and the information contained in this presentation that constitute forward-looking statements are based on management's current expectations. For a summary of specific risk factors that could cause results to differ materially from those expressed in the forward-looking statements, please refer to the Company's earnings release, earnings presentation and our most recent reports filed with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the full year ended December 31, 2014. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations. In addition, we have included non-GAAP financial information in our discussion. Reconciliations to the most comparable GAAP financial measures are included in the earnings release and in the appendix of the presentation. Any reference in our discussion today to EBITDA means adjusted EBITDA, which excludes non-run rate items for which we've also provided reconciliation from the appendix. At the conclusion of the Company's presentation we will open the call for questions. I would like to turn the call over to Jack Hockema. Jack?

Thanks Melinda and welcome to everyone joining us on the call today. We are going to cover a lot of materials today. I will start the discussion with comments on the fourth quarter and full year 2014 and then Dan will provide further remarks on the 2015 results after that I'll share our expectations for 2015 and then wrap up with the discussion around our perspective for the five year outlook. Looking first at our fourth quarter results, our value-added revenue and EBITDA were slightly below our expectations primarily as a consequence of lower shipments related to and an unanticipated level of destocking resulting from more aggressive than normal yearend customer inventory management actions and export shipment delays related to gridlock at the West Coast ports. The situation at the port is due to an ongoing dispute between the port owners and the Longshoremen's union; we're currently rerouting shipments in order to deliver to our export customers. Although these factors hampered shipments at the end of the year, we continue to generate capacity and productivity gains facilitated by the implementation of the Phase 5 heat treat plate expansion and the new casting complex at Trentwood. As a result, we achieved a record for both throughput and heat treat plate shipments in the fourth quarter. We expect further capacity gains at Trentwood in 2015 and beyond as we continue to realize benefits from these investments. Turning to Slide 5, as we look back on the full year of 2014, our value added revenue was comparable to the prior year while our EBITDA margin declined approximately 1.6 percentage points. These results reflect primarily three storylines for the year. First we established records in 2014 for heat treat plat shipments, automotive extrusion shipments and total shipments. These records were achieved despite demand being…

Thanks, Jack. For the full year of 2014 value added revenue was $733 million was comparable with the prior two years. But looking behind the numbers tells the story different in 2012 and 2013. Our value added revenue in 2014 was the product of higher shipment volumes and lower average value added revenue per pound. The year-over-year decline in value added revenue per pound was substantial amounting to $0.06 per pound impact which on our record total shipments of 589 million pounds equated to more than $35 million negative impact on our total value added revenue for the year. The vast majority of this decline was due to reduced heat treat plate pricing that we had commented on throughout the year. They were largely able to offset the pricing impact on value added revenue through strong shipment growth and specifically because of record heat treat shipments and automotive extrusion shipments. Looking at value added revenue by end market, despite record shipment volume per heat treat plate substantial pricing declines per plate was primarily responsible for a $19 million year-over-year decline in value added revenue for aerospace and high strength and $4 million decline in value added revenue per general engineering applications. The timing value added revenue for aerospace and high strength and general engineering was offset by strong step change growth in value added revenue for automotive extrusions which increased 37% in 2014 on 22% higher shipments, surpassing the prior value added revenue on shipment records that were set in 2013. 2014 also established the new level for our automotive content as our value added revenue dollars per North American vehicle bill increased to $5.35 from $4.09 in 2013. Industry dynamics were strong as North American vehicle bills increased a healthy 5% in 2014, while multiple automotive applications inverted to…

Thanks, Dan. I will start with comments regarding 2015 and then provide some additional thoughts on our long term outlook. Turning to Slide 11 and our 2015 outlook for aerospace and high strength applications, similar to recent quarters we are continuing to experience steady abatement of the supply chain inventory overhang that has dampened demand for all of our products serving these applications. We anticipate 2015 year-over-year value added revenue growth in the range of 6% to 8% for these applications driven by higher commercial airframe build rates as well as reduced drag from the supply chain inventory overhang. In addition to increased shipments from these applications in 2015, we also anticipate an improved pricing environment as competitive pricing pressure on spot buys subsides. While we're unlikely to see significant price appreciation, we hope to get some price relief as we progress through the year Regarding automotive extrusions, in 2015 we anticipate approximately 15% growth in our value added revenue continuing the momentum from the step change growth in 2014 as one would expect from the significant growth in the applications we have a lot of activity to more effectively utilize our available world-class automotive extrusion capacity we will transudation production of extrusions for antilock brake systems from our London, Ontario plant to our Kalamazoo Michigan facility. This action has dual benefits. It will free up capacity at London to continue to launch new programs on their existing press lines and the shift in production of the ABS extrusions will enable us to more effectively utilize the exceptional capability of our press lines at Kalamazoo. While we'll create some short terms challenges flexing our costs as Kalamazoo ramps up and London ramps down, the strategic benefits are significant as we position the Company for long term growth opportunities for these…

Thank you. [Operator Instructions] We'll take our first question from Edward Marshall with Sidoti & Company.

So in 2015, there's a lot of moving pieces. I guess there's value-added revenue pricing, efficiencies. There's changing the facilities. And I guess you gave a lot of detail to value-added revenue per segment level. And I was just curious if you could or if you are willing to take a stab, maybe directionally speaking, into the EBITDA or EBITDA margin and what you think that might look like for 2015 given all those variable pieces coming through?

What our thinking right now is that we're pretty confident given the market dynamics that we see that we're looking overall at around 6% to 8% value-added revenue growth and that's strong top line growth. We expect that we're going to see margin expansion with two key drivers one key driver is the operating leverage that we'll get from the higher sales and the other key driver is improved manufacturing efficiencies, as I said in my earlier comments in 2014 if you get under the covers, manufacturing efficiency added 1.5 points of margin expansion by itself in partially offsetting the significant reduction we had in heat treat plate prices, we're not ready to say that we'll get another 1.5% this year, but we expect we'll get some margin expansion from operating efficiency as well as the operating leverage.

Okay. And I would assume that's maybe back-half weighted given the kind of changes that are going to happen with the prices from Ontario in the first half of the year? Is that a fair assumption?

Well, it will grow -- I mean the operating efficiencies we expect will build during the year as they did last year, I mean it may have been hidden in my comments, but I commented in the fourth quarter with weak seasonality, we actually had record heat treat plate shipments, again, we have record throughput at Trentwood and we had very strong efficiency throughout our operations. So, we've been steadily improving quarter-by-quarter throughout the year with some hiccups but underlying there has been steady improvement. So to say that it should be better in the second half than the first-half, we'd say that's right, because we expect continuous improvement here.

I guess that's a good segue into my second question. You talk about record heat treat plate shipments. And when I think, generally think, of destocking, I think that leads, generally speaking, leads to lower volumes as the inventory bleeds out, and price to that extent. But you've only really seen the impact on price, at least in the non-contract business on spot. I guess a little bit on the contract business as well. Can you give some clarity on why volume hasn't dropped as well, what you would normally characterize as impact from destocking?

Yes, two parts to that and I look at the year as a whole first in the year as a whole with the increased capacity that we had, we did achieve higher general engineering plate shipment. So remember, heat treat plate has two parts to it; one part is aerospace and high strength, the other part is general engineering plate, so some of the plate shipments record was higher shipments of general engineering plate during the year. And in the fourth quarter and this over the past two or three years actually has happened where we've had relatively strong demand from some of our OEM customers in the fourth quarter for heat treat plate that has supported shipments in the fourth quarter of aerospace type plate. And the destocking, some of that applied to general engineering plate, but it also had a big impact on our long products, our extrusions and tube type products and that destocking we actually saw in some of our long products, we saw restocking in the supply chain in October and then destocking in November and then December was just -- was horrendous in terms of destocking, really, really strong destocking.

But you had volumes and shipments are up that's kind of we're on….

Only heat treat plate.

And then if I look at just -- last question, if I look at your general engineering there was a favorable quarter with volume down and sequentially but your pounds up pretty significantly and I am assuming that something to do with mix, could you describe maybe what happened there?

On general engineering, you're saying the fourth quarter, I don't have the numbers in front of me but the fourth quarter of higher than the third quarter, I don't think so, maybe year-over-year.

No, volumes down but pricing up. I was curious as to what's driving this price per pound, value-added price per pound.

That's primarily mix related.

Is that plate?

Yes, that would be a function of plate as bigger percentage of the mix in the fourth quarter than long product; so long products really got hammered in the fourth quarter with seasonality.

And we'll take our next question from Tony Rizzuto with Cowen & Co.

Melinda, how are you guys? I guess the first question is just to make sure I'm understanding correctly. I want to make sure about the guidance that you provided. So if we think about the last couple of years, the value-added revenue overall has been kind of stagnant. It's kind of flattened, understanding your overall volumes were up but pricing was down. I want to make sure I heard correctly. Did you kind of indicate, Jack, that the pricing overall for your value-added revenue on a per-pound basis has an opportunity to maybe move closer to where levels possibly were in 2013? So a little bit of improvement in 2015 along with the volume increases?

No Tony that's not where I was going and the value added revenue in total is as you know is has a lot of the mix in there to. But in terms of pricing from an overall standpoint, we think that the pressure certainly is off. We actually think market conditions support improved pricing right now and we're hoping for some improved pricing but we're not counting on improved pricing in our outlook for the year. Obviously we're not the player in the game here but we think certainly the dynamics are there to start to see some benefits in the spot prices on our heat treat plate products in particular.

Okay. So from the standpoint of the way you guys are looking at it from an internal standpoint, your kind of building in flattish kind of prices overall.

Yes.

All right. And then a question about -- there's a lot of exciting things going on here. You've got a lot of moving parts, as Ed mentioned. You indicated 15% increase in the VR growth in automotive, and that would seem -- and you've made a lot of positive comments about the platform wins and how that's moving forward. That would seem to equate to about $15 million, if I did my math correctly, with the kind of volume growth that you had in there, would seem to equate to about $15 million year-over-year, which would be below the prior year, the incremental volume growth. And I'm wondering. That sounds conservative relative to the comments you made, the qualitative comments you made, about all your wins and how that's going to phase in over the year and new extrusion programs, et cetera.

Yes, we're saying that demand growth is about an 8% compound growth rate and last year I think our value-added revenue was up almost 40%. So we're not expecting a 40% per year growth in our automotive. It was a step change last year. Shipments I think were in the 20s in terms of growth last year, so we did have some mix and some price in our value-added revenue growth last year. I mean 15% is a pretty strong number and remember unlike our friends who are supplying sheet we're starting with a business that has been growing at a 7% or 8% compound growth rate for decade. And they're starting with a denominator close to zero in their growth.

Okay. Jack, I wanted to follow up. Also you made the comment, you talked about in the release you made the comment in your comments about the shift from some of the programs in Ontario to free up more initiatives there in terms of new products and moving it over to Kalamazoo to more fully load that plant. It sounds exciting to me. I'm also just trying to get a better handle on your overall margin as we should think about it. Obviously, pricing is not, at least the way you are kind of building into your forecast right now, not going to be a heck of a whole lot of help, but your efficiencies, the volume growth. So how should we be thinking about -- should we think about kind of 2012, 2013 as a more normal year, if you will when we think about 2015 for the year as a whole given that you've got some plants ramping up and some, maybe some -- a little bit of dislocation there as well?

No, I think you have to start with 2013 as baseline and the reason for starting with 2014 is a baseline is remember there are key factors there. We have records shipments overall even though there was some headwinds. We still have records shipments in 2014 so it was a pretty solid year in terms of volume and pretty solid year frankly in all terms except for the one which was the heat treat plate pricing. And you had heat treat plate pricing a lot of that was contract pricing which had a lot to do with some wins that are back seen in prior years from volumes penalties in those things, but the 2014 contract pricing is what we're going to have for quite some time and we're not expecting major moves in spot pricing, we're hoping for some relief in spot pricing. So I look at it and we look at it that we had strong volume last year and we're not expecting a big change year-over-year in volumes so that kind of become the baseline and then the margin growth from that baseline comes from two major components hopefully there was going to be a little bit of pricing there, but when you're modelling, I wouldn't put a lot in there, you might put a little in there but not a lot for sure we certainly don't. And -- but the other two components is operating leverage clearly has an impact and I am sure you all have your models for what kind of leverage we get from operating leverage, but then the other piece in 2014 and we had some hiccups that everyone remembers in 2014 and we were ramping up DC, our new casting complex which we called DC zero internally and phase 5 at Trentwood even with that, we picked up year-over-year what amounted to 1.5 points of margin improvement from our manufacturing efficiency. And we expect to see continued gains in manufacturing efficiency not necessarily to the 1.5% range but we expect to see margin expansion from that as well.

And we will take our next question Timna Tanners from Bank of America Merrill Lynch.

Hey, good afternoon or good morning to you guys. So, I just wanted to ask, just to follow on these same lines how do we know that this pricing pressure on heat treat plate is a function of destocking and not something more onerous-like or something ominous like the new supply coming on the market or some structural shift in the demand environment?

How do you know that?

Yes, I mean there has been some new capacity being added, right, when China and some other -- how do we know that you have been able to hold onto margins and this niche product that will return to historical margin levels?

Well I did not say the return to historical margin levels, I just commented to both and the answer to both Ed and Tony that we're basically expecting that 2014 is the norm that we work from, that's the baseline and we hope for some margin improvement. So all of my comments have been that we see pressure is off, so we don't expect further deterioration we certainly think market conditions and total market dynamics which include the supply side and the demand side, the combination of those two support improve pricing on the spot prices, but we hope so, we hope for it and we'll look for it, but we're not counting on it.

I'm going to switch gears here if I could. So you are paying down some debt, but I thought that your 225 million maturity in 2020 was -- I thought you could call it earlier, and I thought that was coming up. Can you remind us what you are thinking of doing with that debt, and then talk about general uses of cash given your under leverage that we've talked about in the past?

Sure, the senior notes the $225 million tranche is first callable in 2016 and I believe it's June purpose and I think the premium on that will be around 4% or so if we were to call in the first call date, which we may depending on the interest rate environment looks like as we get close to that bid. And so the fact that we're paying off the convertible notes does not take away the fact that we think we have very good access to capital markets and if we had needs and reasons to be going to the markets, we certainly expect that we'd be able to do so. The cash usage remains the same as it always has been, Jack mentioned it, I think I mentioned it first growth for organic growth and potentially if there is an accretive and a good acquisition opportunity also for acquisition growth, the fact that we're actually paying off the convertible notes is one where we said we always anticipate and look for on a liquidity with the ability to pay off convertible or any debt that's coming up due before or unless we're planning on refinancing in this case we're not planning the refinancing and we're always looking for what our liquidity structure is going to look like even in a downturn. And so that's why we look like we got a stronger liquidity profile than any other companies might feel comfortable living with, we're one that always is conservative in that regard. And then finally, we expect to have full other cash generation over the next several years, we expect that we'll continue share repurchases and dividend improvements.

And we'll take our next question from Josh Sullivan with Sterne, Agee.

Good morning Jack, Dan, Melinda. Just with the expiration of VEBA in 2017, is the corresponding balance sheet obligation is going to be reversed as well, or how does that work?

We hope so and we think that it should happen that way, we have to really work through the whole accounting impact of not having the VEBA obligation, all the facts we think that support that would become up our balance sheet, we just have to talk to that with our auditors and probably with the SEC.

And then just when you think about your long-term goals to eventually get back to the high 20% margin, so if that is still a long-term goal, just given the pricing environment in the heat treat market, how much of that target going forward is going to be driven by the automotive side?

Well the automotive is with 8% compound growth rate in demand and we think we'll do at least that well and then the aerospace and high strength plate which has a 5% growth rate, so obviously automotive is going to contribute little bit more than for its portion of the segment. So it's a portion of that growth but it's the overall growth that's really the 4% compound growth rate and demand which we expect to receive next year, but longer-term we're looking at 4% plus in terms of value added revenue growth in all and automotive is very important component to that.

At this time we have one question remaining in the queue. [Operator Instructions]. We'll take our next question from Phil Gibbs with KeyBanc Capital Markets.

Hey. Thanks for taking my question. Fourth quarter, 176 a pound in aerospace and high-strength, Jack, did you comment on why that declined a nickel from even the mid-2014 array was that all mix related?

Absolutely, yes it was back to my earlier comments we had really strong plate shipments in the fourth quarter and long products got hammered by destocking and in the aerospace and high strength sector unlike general engineering, aerospace and high strength plate is the lowest priced product and all of the long products are much higher priced than plate, conversely in general engineering, plate is the higher priced product and the long products are lower priced.

So you had decent mix in general and engineering then because I saw your pricing went up there too. Did you get a little bit of relief on timing of any metal movements there? I know you're neutral over the course of the year, but from a timing standpoint, did that benefit you in the quarter?

Yes, we got a little bit in the fourth quarter as the metal prices came down some and that's just the fact that the plates spot prices are high and don't move in precise concert with the market, so we've gotten squeezed a little bit in the third quarter and we got a little bit relief in the fourth quarter if you look at it sequentially.

Reasonable, though, to look at pricing for 2015 as sort of an average then --

Yes.

Of what you've realized there?

Yes.

Okay. And then on the side of aerospace within that growth for this year, I just wanted to confirm that most of that 6% to 8% was volume related it wasn't pricing related. I think you sound like you're holding out a little bit of hope that pricing could get better but a lot of that is within your core volume visibility at this point.

Yes that's precisely the case.

Okay. And just one more if I could, just for clarification. I know you said you had 150 BPS of efficiency improvement from last year, but I know you also had issues in 1Q from higher energy costs. In 3Q, I think you also had some issues from scrap page and yields. So how do we segregate those items? Were those impactful to you guys last year that we should not be thinking will impact you this year?

Yes, first one when we measured manufacturing cost efficiency, we exclude energy price which is we call that internally a non-controllable net bounces all over the place although we count energy usage, so if you go back to the first quarter we had a couple of million dollars I think of what we call weather related and part of that was energy prices per se and part of it was usage because of the cold weather and then I think we had some production impact as well. But most of that would have things that we wouldn't count in our manufacturing efficiency measurement. However the third quarter issues that we had were essentially all manufacturing efficiency type issues. In terms of how you model it there are lots of pluses and minuses that happen over a year 1.5% margin attributable to manufacturing efficiency is a pretty darn good year. So I wouldn't be modelling. I wouldn't necessary use that as pattern or say that's going to happen every year. We again like pricing, we'd hope to get those kind of levels and we expect to see margin mix expansion but not necessarily a 1.5 every year.

Okay, but that 150 did include the 3Q issues as well, the scrappage issues?

Yes. And in the first quarter, we didn't have our new casting complex online and we were just getting going with the phase 5 expansion. So we did -- the first quarter I'm looking at the gurus here, but the first quarter was actually our worst quarter of the year in terms of manufacturing efficiency. So it improved fairly steadily as the year went on.

So the energy -- the potential energy cost savings associated with running that new caster are not included in the efficiency savings outright. Those energy savings could be separate from that because I know probably --

I will be -- the usage goes into the efficiency. So we use a flat -- we use a flat rate for energy consumption to calculate our efficiency and use a price variance as a separate item,

We will take a follow-up question from Tony Rizzuto with Cowen & Co.

Thanks for taking my follow-up, just a house cleaning item here. I don't know -- I didn't hear it, but maybe you can just talk and quantify the year-end shipping delays associated with the port situation?

Yes.

Maybe from your volume standpoint or bottom-line impact?

I don't have that number. I don't even think we've done that number. The primary issue was the aggressive customer destocking. The port issue was less of an issue in the fourth quarter from a shipments standpoint although it did contribute to as falling below expectation. We would have had more aerospace shipments than we had but the biggest issue in our shortfall from expectation was the aggressive customer destocking.

It appears there are no further questions in the queue. At this time, I would like to turn the conference over to Mr. Jack Hockema for any additional or closing remarks.