Management projects sales to increase in 2025 as we expect solid growth in the commercial aerospace market, and the Company's strong position in that market is expected to continue, including engines spares.

The Engineered Structures segment is focusing on the optimization of its manufacturing footprint and rationalization of product mix in order to maximize profitability.

We expect our commercial aerospace wide body and narrow body demand, including engine spares, also to continue to grow.

Management continued its focus on liquidity and cash flows as well as improving its operating performance through profitable revenue, efficient operations, and margin enhancement.

Management has also continued its intensified focus on capital efficiency. Management's focus and the related results enabled Howmet to end 2024 with a solid financial position.

The segment reduced approximately 160 net headcount since the end of 2023 as a result of lower production.

Quality control issues at The Boeing Company (“Boeing”) have had and are expected to continue to have a negative impact on narrow body and wide body production rates in the near term. In addition, a labor union work stoppage and ensuing production restart at Boeing has negatively impacted results.

The global trade landscape is growing more volatile, including, as a result of the recent executive orders in the U.S. for the imposition of new tariffs, the likelihood of further tariffs and retaliatory counter measures by other countries.

Inflation worldwide and in the United States has resulted in an increase in the costs of materials and labor.

Howmet faces significant competition, which may have an adverse effect on profitability. As discussed in “Competitive Conditions” in Part I, Item 1 (Business) of this report, the markets for Howmet's products are highly competitive.

Howmet's competitive position and future performance depend, in part, on the Company's ability to develop and innovate products, deploy technology initiatives, and implement advanced manufacturing technologies.

In addition, Howmet may face increased competition due to industry consolidation. Companies that are strategic partners in some areas of Howmet's business may acquire or form alliances with Howmet's competitors, thereby reducing their business with Howmet.

COGS as a percentage of Sales was 68.9% in 2024 compared with 71.9% in 2023. The decrease was primarily due to higher volumes and favorable product pricing, partially offset by increased net headcount, primarily in the Engine Products segment, in support of expected revenue increases.

The Engineered Structures segment is focusing on the optimization of its manufacturing footprint and rationalization of product mix in order to maximize profitability.

Howmet maintains a disciplined approach to cash management and the strengthening of its balance sheet. Management continued to focus on actions to improve Howmet's cost structure and liquidity, providing the Company with the ability to operate effectively.

R&D expenses were $33 in 2024 compared with $36 in 2023. The decrease of $3, or 8%, was primarily due to the timing of spending on technology projects.

Howmet's competitive position and future performance depend, in part, on the Company's ability to develop and innovate products, deploy technology initiatives, and implement advanced manufacturing technologies.

The Engineered Structures segment is focusing on the optimization of its manufacturing footprint and rationalization of product mix in order to maximize profitability.

Repurchased the Company's common stock of approximately 6 million shares under the Share Repurchase Program for approximately $500

On July 30, 2024, the Board of Directors of Howmet Aerospace approved the establishment of a 2025 dividend policy to pay cash dividends on the Company's common stock in 2025 at a rate of 15% plus or minus 5% of net income excluding special items.

Capital expenditures are expected to increase with additional investments in capacity expansions.

Howmet and its worldwide operations, as well as its customers and suppliers, are subject to numerous complex and increasingly stringent health, safety, and environmental laws and regulations.

Howmet is unable to predict the future course of industry variables, the strength of the U.S., regional or global economies, or the effects of government actions.

Increased concern over climate change has led to new and proposed legislative and regulatory initiatives, such as cap-and-trade systems and additional limits on emissions of greenhouse gases, which in turn may trigger customer decarbonization requirements.

Aircraft production in the commercial aerospace industry continues to grow based on increases in demand for narrow body and wide body aircraft.

Governmental policies, laws and regulations, and other economic factors, including inflation, customer requirements, tariffs, and fluctuations in foreign currency exchange rates and interest rates, may affect future results of operations and cash flow.

Howmet is subject to cyclical fluctuations in global economic conditions and lightweight metals end-use markets.