Ladies and gentlemen, welcome to the Solvay's Auto Batteries conference call. Solvay team, the floor is yours. Good afternoon, and welcome to our webinar focused on the automotive market. My name is Jodi Allen, and I'm the Head of Investor Relations. I'm joined virtually by our CEO, Ilham Kadri, and Michael Finelli, President of our growth platforms. Following today's presentation, we will host a Q&A session where we will also be joined by one of our leading technical experts, Maurizio Gastaldi, Director of our Battery Materials Platform, as well as by Karim Hajjar, our CFO. Today's call is being recorded and will be made available for replay on the investor relations section of our website. You may refer to the slides related to today's broadcast, which are also available on our website. With that, I'll turn the presentation over to Ilham. Thank you, Jodi. Hello, everyone, and thank you for joining us today to discuss what we believe is an exciting transformation occurring across the entire transportation industry. In fact, as we think about the future of mobility, we are preparing for significant and ongoing advancements across many forms of transportations, in cars, in trucks, in trains, and even air travel. Let me first take a step back and give you an overview of our materials business segment. When I launched our growth strategy two years ago, I had indicated that our ambition was to extend our leadership position as a pure play in advanced materials. To do so, we realigned our resources to become a market-driven organization focused on our key growth markets: transportation, electronics, and healthcare, shown here on Slide 4. We have prioritized our investments in these segments to leverage our leading positions and accelerate our growth. This focus allowed us to emerge stronger following COVID-19, outperforming many of our peers. As you know very well, this attractive and high barrier to entry business delivers industry-leading margins of around 30%, high returns, and strong cash conversion of around 70%. In fact, believe it or not, our Specialty Polymers business is as cash generative as our Soda Ash business. It's an innovation machine with 1,000 patent families in the segment, 200 of which were filed in the past two years alone. With many exciting opportunities in front of us, we estimate around 10% sales growth in this segment annually over the next several years. Looking ahead, we will continue to share more on our positions in each of the key markets through a series of webinars leading up to a more formal Capital Markets Day to be held this year. As a reminder, we began this update with our ESG webinar in December, and the feedback from investors on our Solvay One Planet plans and progress has been very positive. Most importantly, our progress is helping our customers to be more sustainable. Today, we will highlight the automotive industry, our leading position, and the electrification transformation that is underway. Now, before we dive into Auto, let me remind you why our Materials business is so attractive, which I will define as a repeatable, successful model. First, we have an unmatched portfolio of technologies. We offer an extensive and proprietary range of high-performance polymers and innovative compounds. We have high-performance carbon fiber composites materials, as you know. Today, the composites mainly serve the aerospace industry. Our high-performing polymers are all on the top part of the performance pyramid. These include PVDF, PEEK, PPA, PPS, and many other high quality, high-performing polymers that enable us to meet a wide range of performance needs. Let me be clear, we are not just selling products. In fact, we are offering products. What we are selling is a unique value proposition as compared to other competitors. Nobody out there has the breadth of portfolio we have. When customers come to us, they do not come for a PEEK solution or for a PVDF solution. They come for the best technology at the lowest total cost of ownership. With us, they save money, they save time, and they become more sustainable. In fact, we are using these technologies together with our customers to develop unique combinations of properties that solve their specific application and performance and competitive cost requirements. You will hear later in the presentation some examples of the type of solutions and the benefits they offer. Our customers simply are looking for this kind of strategic partnerships. They look for us for the capabilities to innovate for their specific needs at the right time, at the right cost, in the right region, actually, regardless of the technology used. This has awarded us many qualifications and long-lasting partnerships over the years. With the largest portfolio of Specialty Polymers in the market and the composites resin infusion know-how, we have in-house all the building blocks to make the best and more plastic composites in the market, and our customers are asking for, and these materials will be needed for future mobility platforms and even more. As a reminder, we do not participate in the lower performing or commodity polymers, which are products you know them, such as polyolefins, polyamide, polycarbonate, polyacetal, and this is by choice. As you may recall, we have been divesting our commodities, including more recently, the Polyamide business in January 2020, and other commodities to stay focused on offering high-end, higher value solutions. On Slide 6, we remind you that our business has a global presence that can support our customers globally and locally. We have 26 production sites across three regions. Our Automotive market is served by several main hubs in each of these regions, including China, France, Italy, Belgium, and the United States of America. We will share more about our expansion plans later in the presentation. Of our 5,800 employees in the segment, about 40% are dedicated to commercial, research innovation, technical service, and development with our customers, and we are proud of them. Now, Slide 7. Today, we are going to focus on the Automotive market, and the opportunities are just enormous. They are driven by sustainable mega trends, including lightweighting and electrification. As you may know, our materials are enabling lower CO₂ emissions while enhancing performance. Let me put it into context. For every 100 kg weight reduction, it leads to lower CO₂ emissions by 7.6 g/km. If you think about it, we lighten any object, be it a car, be it an aircraft, be it an e-bike, and we enable our customers to become more sustainable. It's a fabulous opportunity for us as a company to become the leading pure play in clean mobility, especially on Scope 3, where the whole value chain is considered. This is the next ambition of Solvay One Planet. Slide 8. As you all know, the auto transformation is clearly underway, and it's being driven by several factors, from a shift in consumers' mobility preferences to increase in regulations, as many regions in the world have set ambitious goals for decarbonization. You have already seen commitment in China, in parts of the United States of America, and in Europe, and it is clear the momentum will continue. We have seen carbon pricing markets and carbon pricing increasing, and its trading being real. We are witnessing the Green Deal in Europe and of course, the inroads into the battery value chain localization. Slide 9. As you all know, automotive OEMs are already moving quickly to meet these demands. In fact, they are making significant investments which total over EUR 400 billion to increase their electric vehicle portfolios, bringing more than 300 new BEV models to market by 2025. We are excited about all the opportunities that these changes will bring, not only because they are good for our planet, but also because they are going to fuel the top-line growth, justify brownfield investments at high returns, and they are profitable. In fact, Solvay is already well-positioned to be a key material player throughout the next decades. In Slide 10, I'd like to start with our proven business model and how we have established our leadership position in this space. In this slide, you see a high-level view of our four main drivers of success. First, you may not realize that Solvay has been supplying solutions to the automotive industry for over 30 years, and through these multi-decades, we have formed partnerships with OEMs and tier one players. Today, we have about EUR 900 million worth of opportunities in our pipeline across major OEMs and tier suppliers. Second, we listen. We listen, and we work with our customers to better define their unmet needs, which include reducing the weight of vehicle parts and objects, and therefore helps reducing the CO₂ emissions. Depending on the application, we can reduce weight by substituting metal with polymers anywhere between 20%-50%. For the electric powertrain, we have an entirely new set of problems to solve, including making batteries go farther, be safer, and charge faster while helping to reduce the overall cost of ownership. Three, innovation is key. Innovation is another essential part of the process. As you can see from our Vitality Index, 25% of our sales are derived from solutions introduced in the past five years, which is remarkable. We have strong intellectual property with over 1,000 patent families covering our materials technologies, as I mentioned before. Finally, obviously, we must also invest in our capacity and in our people to maintain our leadership position. Yesterday's announcement will bring our capacity in Europe only to 35 KT. This will enable us to meet our 2025 growth ambition of EUR 1.5 billion. We must not forget the investment in our people. It's all about people. In the past two years, we have increased our resources in this area with our dedicated battery platform led by Maurizio, who is sitting in the room with me today, to ensure focus, speed, and success. Since its creation, the platform has both hired and deployed resources, and we now have nearly 400 full-time equivalent dedicated to auto and batteries, a significant increase in the past few years. Now, before I introduce our next speaker, Mike, let me summarize what we are going to show you today. First, we have a proven track record of outgrowing the auto market with our repeatable model. Second, we will show you how the shift to EV will accelerate us to deliver double-digit growth. Third, we'll show that our current leadership position in EV batteries is sustainable thanks to our investments and innovation. Finally, how our investment to date will secure our growth until 2025 and beyond. Now, it's my pleasure to introduce Mike Finelli. Mike is the President of Solvay's Global Growth Platforms. He has been in the business for the past 28 years. Previously, he was the leader of our Specialty Polymers business from 2018- 2020. I asked him to come and lead our growth platforms since 2020, actually, because these platforms are strategic to Solvay and essential for our future growth. Mike is going to share with you how we will continue to win and grow our position in the auto market. Mike, the floor is yours. Thank you, Ilham, and, hello, everyone. I'm thrilled to be here today to explain a little bit more about the market and how we are positioned to further accelerate our growth. As Ilham stated, it's clear that the transformation to electric mobility has begun, and the need to reduce emissions is accelerating. As you can see from Slide 12, roughly half of all cars produced worldwide are expected to either be fully electric or a hybrid model by 2030. That is a massive transformation for the industry. The electrification of the powertrain will be the dominant trend facing this industry. As Ilham shared in the beginning, this shift is already gaining momentum globally and is one of the biggest growth opportunities in the chemical industry. You can also see from this chart that there are three types of vehicles from a market perspective: internal combustion engine cars, also known as ICE, battery electric vehicles, and hybrids. From our perspective, there's actually just two application areas, which for the purpose of this presentation, we label as ICE powertrain and electric powertrain. This is because the hybrid model is exactly that. It combines both technologies from the ICE and the electric powertrain. Moving to Slide 13, let's take a look at what this transformation means for Solvay. We have outperformed the market over the past five years. As you can see, despite the auto industry decline of 4% from 2016 to 2021, we grew our polymer sales to the auto industry by 8% per year over the same period. Why? Well, despite the production decline in the standard combustion engine market, we benefited from the continued penetration of our polymers in replacing traditional metal applications. We continue to penetrate into new areas around the lithium-ion battery. I'll share some examples with you shortly. What is even more exciting is that our growth will significantly accelerate over the next 10 years. We estimate double-digit growth in sales between now and 2030, with sales projected to exceed EUR 2.5 billion, reflecting an average annual growth exceeding 13% per annum. This is from a basis of around EUR 800 million at the end of 2021. Now let me explain how we will achieve this. We already reviewed the market growth expectations with the transition to electric powertrains. This transition means that the addressable market for our materials actually doubles. We've shared with you before that the weight of our technologies in an electric powertrain increases as more hybrid and electric vehicles are produced. Today, we can confirm that the value of content per vehicle actually doubles with the transition to an electric vehicle. For Solvay, this means that we will also increase our market share as the addressable market and value per vehicle increases. Now let's deep dive into why the addressable market per car doubles with electric vehicles. Now, for the past 10+ years, there's been a big industry trend for decreasing emissions. We have helped the industry to reach those goals by enabling OEMs to make vehicles lighter, safer, and more efficient. We did this by replacing metal parts with high-performing polymers well before the introduction of the electric powertrain. You can find many Solvay technologies in today's internal combustion engine vehicles. If you look at the left slide of Slide 15, we've used our broad portfolio of polymers to develop solutions for a wide range of applications spanning thermal management, structural parts, lighting, and electronic systems. The good news is that most of these applications are also needed for hybrid and electric vehicles. In fact, light weighting and safety become even more critical when a heavy battery is introduced into the powertrain. In addition to the translation of applications from ICE to hybrids and BEVs, electric vehicles bring new performance challenges that require the use of our most Advanced Solutions. You can see the added applications on the right side of the diagram in blue. The battery applications are the most obvious, but we also have developed solutions for other electric applications such as power electronics and e-motors. We need to reduce weight, and emissions is not going away. In fact, it's accelerating the need for our technologies. Again, this is why the emergence of the electric vehicle doubles our addressable market. Slide 16. According to the European Commission, reducing a car's weight by 100 kg leads to lower CO₂ emissions of 7.6 g/km driven. Now let's take a look at some specific parts that are now being made using Solvay polymers. We have an example from each vehicle type, ICE to hybrids and BEVs. The first one on the left, these are coolant lines. These are commercially used today with several major OEMs for ICE powertrains. The advantage over metal is a 50% weight reduction and design flexibility. The advantage over a commodity plastic is higher performance, such as temperature resistance. Now moving to the middle image, what you see here is a magnet wire used in e-motors for hybrid and electric vehicles. Solvay was the first mover in this space to use PEEK to enable OEMs to increase horsepower and torque, which allows them to reduce the motor weight by up to 25%. Moving to the third picture, this is an example of a disruptive application. This is a battery enclosure based on our thermoplastic composite technology. It reduces the weight of the enclosure by 25% versus aluminum and a massive 40% versus steel. In addition to that, it also allows a functional integration of the components. It's a perfect example of how our technologies are inside and around the battery. Now let's deep dive into a battery. Lithium-ion batteries have four main components, the cathode, the anode, the electrolyte, and the separator. We have solutions for all four of them. PVDF is universally used as a binder in the cathode composition. It's also used as a coating on the separator. PVDF as a binder allows improved energy density, and the PVDF coating on the separator improves safety. It's also important to note that although PVDF adds significant value and performance benefits, it only represents a minor portion of the total battery cost. While PVDF is an exciting growth area for us, it's not our only offering. We have a number of other solutions to improve battery performance. We also produce additives and solvents used in the electrolytes. These will become even more important to enable next-generation batteries with even higher energy densities. We produce lithium salts such as LIFSI, also used in the electrolytes to support faster charging that cannot be achieved with incumbent salts. That I mentioned previously, we truly circle the battery inside and outside. This is why our solutions to the battery itself offer an opportunity of over EUR 2 billion by 2030, excluding non-battery applications. How does this all fit in the value chain? Let's take a closer look at our customers and more specifically where we hold a unique position. As I just mentioned, you can find our materials in the cathode binder and in the separator coating and in the electrolytes. Let me be clear, we do not make the cathode or the separator or the electrolyte, but we supply materials as ingredients to make these perform better. Our customers include key battery manufacturers and OEMs, and we are specified with all of the major players. Recycling is another area where Solvay is active. We have signed the JV with Veolia to establish a European consortium where Solvay's role is to purify and extract the noble metals such as lithium, cobalt, and nickel from the black mass coming from batteries at the end of life and from production scraps. These metals will be battery grade and will be used as a precursor for new cathodes, closing the loop and bringing a true circular economy to the battery industry. We are pleased to have Renault as the first OEM to join the consortium. Slide 19. Now I'd like to focus on the cathode, which plays a significant role in determining the battery capacity. Today, there are several types of cathode technologies. Two of them make up the largest share of the market today and are expected to grow in the next couple of years. As you can see in the chart on the left are the LFP and NMC batteries. LFP uses lithium iron phosphate as the cathode material, whereas NMC uses lithium, manganese, and cobalt. LFP is the solution of choice for entry models where cost prevails versus performance. While NMC has high energy density, which means there is more energy with the same amount of battery, allowing vehicles to have an extended range. Therefore, we expect to see NMC on the higher end of the market for larger or higher performance vehicles. Both cathode chemistries require the use of PVDF binders. There are two types of PVDF technologies in the market today: suspension PVDF and emulsion PVDF. Suspension chemistry is more flexible and can be used in both LFP and NMC batteries. While emulsion technology is primarily used only in the LFP batteries. Solvay participates in both types, thanks to its range of technological capabilities. We focus more on NMC because suspension chemistry allows us to continuously innovate and solve our customers' increasing performance requirements. As an example, our customers have been asking for higher levels of adhesion. As you can see in the chart to the right, with suspension chemistry, we are able to achieve more than 2x the adhesion achieved by emulsion technologies. Higher adhesion means higher energy density, which translates into a more powerful battery in your vehicle. In fact, we are the world leader in suspension PVDF, which makes us the supplier of choice in the industry for NMC binder solutions. Innovation is a continuous process. Every day we are collaborating with our partners to understand and anticipate their future needs and higher performance requirements for the next generation of technologies. Solvay is actively supporting our customers in shaping the next generations of battery technologies along a clear roadmap. We are developing new chemistries that will continue to solve the most difficult challenges for Gen 3 and Gen 4 batteries. Gen 3 batteries will need higher performing salts and additives that can increase high and low temperature battery performance. We are in full development of LIFSI and of other proprietary additives. Now, the surge of high manganese cathodes is also triggering the need for high voltage resistance solvents and the solvents for electrolytes. This is why Solvay is introducing a new Energain solvent with unique resistance to voltages up to 4.9 V. Gen 4 batteries, these are the famous solid-state batteries that are expected to be introduced later in this decade. We already have developed a new solid film with an encapsulated electrolyte, which we branded Solgain. This technology will allow the industry to achieve the significant improvements in energy density and safety that solid-state batteries have promised. Solvay is the front runner in Europe for this new technology, and we are investing in the most advanced pilot plant in Europe. Slide 21. Now, you've probably read the announcement we made yesterday. This significant investment will allow us to reach about 35 kt of PVDF capacity at Solvay's site in Tavaux, France, making us the largest PVDF producer in Europe. With this investment, we will be three times the size of the closest competitor in Europe, and it will solidify our position as the largest suspension PVDF supplier in the world. As a reminder, we added additional capacity in our site in China, which is coming on stream at the end of the second quarter. Our new expansion in France is scheduled to be completed at the end of 2023. With respect to permitting, these will secure our 2025 growth ambition. We now have PVDF operations in three regions, serving multiple end markets in the U.S., in China, and our large-scale flagship site in France. This will prepare us to meet the growing demands that our customers require, and we will continue to develop our industrial roadmap to ensure we can keep up with our customers' needs for the rest of the decade. You can expect to hear from us on additional expansions in China and in the United States in the future. Thank you for your time today, and I will now turn the presentation back to Ilham. Thank you very much, Mike. I hope, ladies and gentlemen, that you can now understand why I'm so excited and thrilled from day one about this opportunity when we launched our battery platform back in 2019. You can understand that we have a proven track record of outgrowing the auto market. We have a resume. We have in-house the technology, the resources, and more importantly, the talent to thrive in this market. We have been, in fact, preparing this new investment for almost a year, as it includes a fully integrated suspension PVDF platform, which include almost four different mini plants, which will cater to the high-end battery market in Europe. We are very excited about our ability to supply these exciting growth markets, and more importantly, enabling our customers to become more sustainable while creating value for our shareholders. Thank you very much for listening, and we will now take your questions. Thank you. Ladies and gentlemen, if you wish to ask a question, you may press zero one on your telephone keypad. It's zero one on your telephone keypad. We have our first question from Jaideep Pandya from On Field Research. Please go ahead. Oh, thank you so much. A couple of questions, if I may. Firstly, congratulations on the investment decision. PVDF prices, both for lithium grade and solar and coatings grade, have seen significant increase in China, and current prices are almost, you know, EUR 40-60 a kilo. Could you just explain to us how are your contracts with your longer- term customers in this regard? Then secondly, just on the site in France, are you going to be completely backward integrated into the precursor 142b? And have you secured all the regulatory requirements from the Montreal Protocol for the same? Thanks a lot. Yeah. Thank you for the question. As we have, the presence of the business, Mike, would you like to take the question on the contract? Yeah. Thank you for the question. Simply put, you know, we are setting our contracts up so that we have the flexibility to pass on raw material costs. We've been able to do that so far, so we're quite confident we'll be able to continue along that path. The second part of the question, I'm sorry, was about our vertical integration in our, the new investment that we announced. Is that correct? Yeah, on the vertical integration on the 142b. That was the question. Yeah. Yeah. Yeah, thanks. As Ilham mentioned earlier, the investment in Tavaux is actually four plants. We have several precursors even before 142b. We have the precursor to 142b that we're expanding, the 142b, the VDF, and of course, the PVDF. That's actually a fully integrated facility that we're investing in. I think the last question was about the ODS, the 142b. Yes, in Europe, you know, this is a regulated substance, but we convert it to another material. As long as we follow the rules of the regulations, there's no problem. There's no limit on how much we can produce and convert into PVDF. Yeah. Thank you, Mike. So I hope the answer was clear. Vertical integration, yes, it's so important, and it's actually a big differentiator, and that's why we took our time to put the right plant in France and obviously, you know, go with the full integration because we believe that's a huge competitive advantage. On pricing, Mike and his team, and with the presence of the Material business, obviously, you know, you're right. With the inflation and with the supply/demand, which is very, very tight for years to come, we have contracts pricing, but there are also quarterly closes and pricing depending on raw material and the situation of the supply/demand. Back to you. Thank you, Madame. Next question is from Mr. Sebastian Bray from Berenberg. Please go ahead. Hello, good afternoon, and thank you for taking my questions. I'll start with your comments, Ilham, earlier on the cash generation of this Specialty Polymers segment. Was the referenced 70% cash conversion just taking EBITDA of the segment and deducting CapEx? Is that the right definition? When you say the Specialty Polymers are as cash generative as Soda Ash, is this in relative, i.e. percentage, or absolute terms, the number of EUR million of cash that are released by the business each year? My second question is on the implications for group CapEx planning over the next few years of this investment. That EUR 300 million looks as if it's going to be compressed over two or so years of investment cycle, plus apparently some investments in the pipeline for U.S. or China and PVDF. Maybe a bit of catch up CapEx from what was deferred from Corona. Is it possible group CapEx moves towards EUR 900 million or even EUR 1 billion over the next few years? Thank you. Yeah. Thank you, Sebastian. Your question on the definition, yes, you're right, is EBITDA. I have Karim with me, so he can jump in. EBITDA minus CapEx over EBITDA, right, Karim? That's the right, the cash conversion is indeed EBITDA less CapEx, Karim. Do you wanna- No, indeed. I think essentially what we're saying is the Specialty Polymers business has been at least as good a cash generator as our Soda Ash business over time, both as a percentage, but also in absolute terms as well. Yeah. That's one of the reasons it gives us the platform and the confidence in we taking the next step, this huge investment. Yeah. You've seen on the cash, Sebastian, that, you know, the group has dramatically improved the cash generation from mid-20s years back- Yeah. Back to my first year was 28%. Obviously 2020 with the temporary cost saving, we hit the 50% and around 40% for the first nine months of 2021. You will see by the end of the month, right, the full- year. I remind all that we funded our pensions by almost EUR 1 billion and deleveraged the debts and that help us to spend less cash, obviously, on the pension interest rates and redirect them to more investment. We are better company in terms of free cash flow. Conversion, it's quality, it's phasing, including in the growth platform, and this gives us the foundation to both invest more for superior growth and continue this journey now of reinvestment. Yeah, 2020, you remember, we had a lower CapEx for obvious reason, COVID-19, and we wanted to look at how we're gonna emerge stronger from the crisis, which we did. In quarter three, 2020, we restarted reinvesting. You will see the CapEx, you know, we spend in 2021, and be patient by the end of the month. Definitely what I promise in quarter three is that you're gonna see an acceleration, and you will see it happening. Yeah. Thank you. Next question is from Mr. Chetan Udeshi from JP Morgan. Sir, please go ahead. Yeah. Hi. Thanks for letting me ask a few questions. I'll start with a very basic question. Can you help us understand. Again, I don't want specific numbers, averages are fine. Like, what is the typical PVDF content per kilowatt-hour battery? And if you can give us some specific numbers for LFP versus NMC, that would be useful for us just to think about the potential in this market. The second question I had was, you know, that clearly, you know, the top-line numbers that you guys have given from batteries, you know, look very strong, but there was no mention of what we should think about in terms of margin and returns. Because we've seen in other places where, you know, the growth in the EV battery market essentially comes with a much lower margin and return. Can you help us understand how you think the margin and return profile of the incremental sales from batteries would look like? You know, can we expect 30% margin to be sustained, et cetera? The last question was on patent protection. Last year there was some news that, you know, the Chinese government or Chinese courts upheld a particular patent of Solvay against a Chinese player on PVDF. Can you help us understand how is your patent protection in this particular segment? Or is that something that you can leverage to maybe, you know, defend your position in the market from a long-term perspective? Thank you. Yeah. Thank you very much, Chetan. I have Maurizio with me. He's leading our growth path from batteries since 2019, so I'll leave him the technical question, and I take the margin after. Yes. I'll answer your first and third question. About the specific consumption of PVDF in the batteries, the data point to roughly 40% more consumption for LFP chemistry than NMC. In general, the model delivers results of- 40 tons per gigawatt hour for, say, NMC chemistry and then 55 or so for LFP chemistry. In terms of a specific amount, in the weight of the batteries, we're talking about 1-1.5%. For the third question that is related to the way we protect our IP, for our Materials, well, we do this very vigorously. The case you refer to in China is a case of supposed infringement of one of our patents from a Chinese contender that we're gonna fight very hard. We've invested massively in this technology in the past. We wanna make sure that we protect it with any possible way. Yeah. Thank you, Maurizio. On the margin side, Chetan, I can confirm that the return we expect to deliver are significant and highly value accretive. As you know, we have margins around 30%, and they will be sustained at the minimum, right? It's a prudent assumption. We are raising the bar in terms of pricing, contracting, et cetera. You heard it from Mike and from, you know, Maurizio as well. The suspension has more barriers to entry than emulsion. We are not gonna go after the low-end market where you see a lot of competitors entering in the emulsion space. Suspension is another game. It delivers high-end properties. Today, the battery business is not at all a laggard in terms of property in our crown jewel, right? The material business. We will continue. We target these high-end battery markets. The customers value our differentiated performance. I truly believe personally that commoditization will start, basically in the emulsion space, not at all in our space. Back to you. Thank you. Next question is from Mr. Laurent Favre from BNP Paribas. Sir, please go ahead. Yes. Good afternoon. I've got a question for, I guess, Maurizio or Mike, around the new entrants, so Dongyue, Wanhao. I just wanted to get a bit more clarification. Are you saying that they are only entering in emulsion and that that's an area where you think you have less exposure, and therefore the risk from pricing in that area is already captured in your targets for 2025? That's the first question. Then the second question, it's going back to the, I think, Sebastian's question on CapEx, maybe for Karim. It looks like you target sales in batteries going from about EUR 200 million to about EUR 800 million. How much CapEx on top of this EUR 300 million do you think you would need to get to that number for 2025? Thank you. Okay. Maurizio, do you want to take the new entrants? Yeah. I can comment on the situation with the new entrants. I would say that it would be a mistake to underestimate the strength of competitors in general for any company. At large, it is true that the Chinese competitors entering the market are developing emulsion type. Some of them are already working on suspension technology with many years of delay with respect to the leading companies in the market like Solvay and Kureha. It would be not logical to think that this gap will never be closed in the future. For the time being, the position on suspension technology for the leaders is extremely strong. However, the majority, as I said, of the capacity which is being installed in the new projects point at the developing emulsion technology. Laurent, your second question. We're completely covered to get to our 2025, so this really equips us to deliver that. To get towards the 2030 ambition, yes, of course, you can expect us to continue to invest that very wisely. Yeah. Thank you. Next question is from Peter Clark from Société Générale. Sir, go ahead. Yes. Thank you. Good afternoon. It is a quick question on probably one of the less exciting polymers you have. I remember when you bought Ryton from Chevron, you cracked the technology as you said you would. I just wondered what sort of growth that business has had, what sort of scale it is, how something like that grows. Looking at that sort of area, of course, we're always told that these acquisitions were extremely rare. This is a business about CapEx really and leveraging your technology. I just wanna reconfirm that when you look at the acquisition lists, you know, in the Specialty Polymers area, this is just not really gonna happen, not too much anyway. Thank you. Yeah. Is that Peter, right? You were talking about PPS, Peter? I didn't- Correct. Yeah. Okay. PPS. So mu- PPS Yeah. Thank you. Yeah. Mike, as Mike is with us and he's the son- Yeah of this business. He led it for many years. Mike, can you pick it up? Yeah. I could answer real quick. The Ryton business is a fantastic business in automotive. It's one of the reasons why we bought it, and it really opens up the door with a lot of companies so that we can bring other polymers to the market. Our expectations of growth are double- digits. In fact, when we look at electric vehicles, we're finding even more applications, you know, for Ryton PPS than we found in an ICE engine. We're quite excited about the future. We have made good progress on debottlenecking that plant. There's still more room to grow, and we expect this business to be a really nice business moving forward. I think that was, I cannot see you, Mike, but that was the example you have been giving on the coolant line, right? During the presentation. Yeah. In fact. Yeah Actually, the coolant line was PPS. Now, that was an ICE engine, but we're also finding, for example, bus bars on an electric vehicle. There- There's a whole new range of applications that are high temperature. I think a lot of people may not realize, I mean, a battery gets really hot. I mean, thermal management in a battery electric vehicle is just as challenging as it is in an ICE around the engine. Yeah. Thank you, Mike. Thank you. Next question is from Mr. Andreas Heine from Jefferies. Go ahead. Yes, thank you. Two questions, if I may. I'm interested in what you said in only one sentence. The composites, you said that you were able to mix them with thermoplastics and carbon fibers. I think that's pretty new, as most of these composites are based on thermosets. Do you think that with these technologies, so being able to bundle the carbon fibers with thermoplastics, that you will make inroads in the automotive, or is that only a story for the next decade? And secondly, in the battery housing, is it right that basically in battery housing, everything has to be plastics and that aluminum and steel will not be used for safety reasons? So that the whole battery housing will be a business for the high-end plastic producers? Thank you. Yeah. Yeah, thank you. Who is speaking? Is that Andreas? Andreas Heine. Sorry. Hi, Andreas. I mean, I'm really excited about the thermoplastic composites, and it was the second growth platform I launched after batteries because I really felt from day one, you know, when I looked at, you know, what differentiates Solvay and the material pure play against competitors, nobody out there has the breadth and the variety of portfolio we have. Why it matters, as I said during my prepared remarks, when customers, they go to a competitor who delivers PEEK or PVDF, they buy just one product, one technology be it. When a customer comes to Solvay, they should come for the best technology, being agnostic to technology. It may look bizarre, but that's how I see it and how we see it. To deliver the best solution at the best total cost of ownership, obviously. That's important. For thermoplastic composite, this is the best at the intersection. You can take the best of the thermoplastic polymers and then the know-how of the thermoset composites, which are thermoset, not recyclable, and based on epoxy resin infusion. Now we are including in them and replacing this epoxy resin with our thermoplastics. Again, the sky is the limit. It can be PEEK, it can be something else, and that's what the second platform we are now pushing. Maybe, Mike, you can give perspective. Mike is leading, by the way, our three growth platforms, batteries, thermoplastics and hydrogen. We're not gonna talk about hydrogen today. Maybe, Maurizio, can answer the second question. Mike? Absolutely. For thermoplastic composites and automotive, this is actually a very exciting area for us. It will take some years to develop, but I will tell you right now, under development, we've got quite a few applications. In fact, I wanted to share with you guys a picture of one of them, but we weren't allowed to do so by the OEM. I can tell you it's a very large part. It's a structural part in an automobile, and we're able to do in one shot a thermoplastic composite and an overmold with one of our other polymers and make this part in one shot, when today it's made out of 22 pieces of steel welded together. That's a massive opportunity for us. There's two things that make thermoplastic composites very exciting in auto. 1, they're inherently recyclable compared to thermosets. This is a big issue for auto. That's why thermoplastic composites are quite exciting for the OEMs. The other thing is with thermoplastic composites, you can do high throughput, which you can't do with thermosets. We really think that thermoplastic composites have a play in auto and structural parts. You can go to batteries as well, Mike, all right? I mean, Well, we already have a application we're working on around the casing. Now, your last part of your question was around, I'm not sure I fully understood it. Something around aluminum or metal casings. Yeah. Being banned. I don't know. I've not heard that, but Maurizio? Maurizio will take this up. Yeah. Mike, I can add to this. No, we don't think that aluminum will be replaced by polymers in the battery casing. You need to have a very good heat exchange, and the plastics will not do the job. On the other side, there's many components in the battery casing where our plastics have a tremendous value proposition, and particularly for gasket and insulators. Okay. Thank you. Next question is from Alex Stewart from Barclays. Please go ahead. Hi there. Good afternoon. I've got two, hopefully quite simple questions. Going back to your slide about slide thirteen, you talk about roughly EUR 300 million in sales- No growth from the automotive industry between 2016 and 2021. Sorry, we can't hear you very well, Alex. You are cutting off. Yes, I seem to have this problem often. Is that better now? Yeah, definitely. Yeah. Okay. If I look at your slide, you talk about roughly EUR 300 million of incremental sales from the automotive industry in materials between 2016 and 2021. Your Specialty Polymers division overall has grown revenue by just over EUR 100 million over that period, which implies that something else in Specialty Polymers is declining to offset some of the growth in automotive. With that in mind, could you possibly talk about which part of the polymer business has been shrinking and whether that's likely to continue or what you think the outlook is there? Because obviously, that will detract from some of your aspirations in the automotive industry. Then the second question, just very quickly, could you tell us how much of your PVDF Production today goes into these EV applications, would be very helpful. Thank you. Yeah. Thank you, thank you. I will leave the floor to Mike, but you will see obviously historically, we are serving different applications. Oil and gas, for example, is very cyclical, right? It can be up and down. We have also some electronic materials going to smart devices, which historically, and I think, in prior to my time, you know, all analysts have that question during the earnings call for Solvay, right? About phones and smart devices when they move from plastics to metal, back and forth. There are some cyclical markets out there which we will, you know, obviously give you more clarity. But definitely the automotive market has been repeatable and proven. For me, you know, when when moving Specialty Polymers from a technology-driven organization, which was opaque to you probably, when I joined the company, to becoming more market-driven, has been, you know, revealing, right, our strengths and proven record of repeatable and successful conversion, and penetration of technology in the automotive. So that's the highlight of today. Mike, anything to add? No, I think you covered a lot there, Ilham. I think, you know, if I go back, the original statement that you said over that period, that was it? Specialty Polymers you said only grew EUR 100 million? I don't recall what you said. I'm just looking at the revenues in your polymer business, which was EUR 1.9 billion in 2016, and the consensus has it at about EUR 2.1 billion in 2021. It's about EUR 130 million. We haven't released the 2021 results yet, Ilham. We'll talk about that, I think, later in the month. Yeah, definitely. Yeah. definitely. Yeah. I think you may be surprised. What I'll also say is Ilham touched on it. 2016 was a very strong year for us in electronics. It was the peak year. There's a very specific application that disappeared. That pretty much answers most of the question that you had. Yeah. It's mainly the electronics and the smart devices. Good. Back to you. Next question is from Mr. Daniel Chang from Redburn. Sir, go ahead. Hi, everyone. Really appreciate the presentation. Thought it was very helpful. Just a couple from my end. I think first is, it seems like the focus here is primarily on, you know, light-duty passenger vehicles. So how should I think about, you know, any further opportunities in heavy duty or trucks, for instance? Secondly, maybe we could have a quick comment in, just in terms of just near-term trading dynamics. You know, we've spoken about autos being quite soft into 4Q. Has that rolled over into 1Q this year? Or has it, you know, sequentially improved there? That'd be appreciated. Thanks. Definitely. Mike, would you like to talk about trucks and heavy duty and give them a bit of taste? Yeah. Although it's early enough on the hydrogen one? Yeah, I think that's great. Great question. Thank you. We have a third platform we call the green hydrogen platform. In this space, this is where we see the utility in heavy equipment, trucks, things like that. Are we still online? Yes, I can hear you. What Solvay does in this, all the places to play. The membranes is like my. Sorry? Mike, you were cut off for a few seconds if you can take it back again. Sorry. It looks like I have an unstable internet connection. No, I was saying that we have a third platform on hydrogen, where our materials are actually the membrane that split the water molecule into hydrogen and oxygen. Then in the fuel cell, which we would see in heavy equipment, trucks, trains, things like that, we actually recombine, oxidize the hydrogen and create energy and water as a byproduct. So Solvay plays in that space. What I will say is, we don't see the acceleration in this towards, more towards the end of the decade, whereas batteries is today and we're seeing explosive growth now. We expect to see this more towards the end of the decade for our hydrogen platform. Thank you, Mike. Thank you. Next question is from Mr. Mubasher Chowdhery from TD. Go ahead. Hi. Thank you for taking my question. Just got the one left, please. In one of the slides, you talk about the fact that your growth until 2025 is secure. Is that assuming the full ramp up of the Tavaux plant? If not, could you give us a feel for what the contribution from that plant could be, just on a top-line basis? What kind of CapEx number should we be thinking about for the EUR 2.5 billion by 2030? Thank you. Yeah, good question. Thank you, Mubasher. Yeah, I mean, the EUR 300 million investment will secure the growth by 2025. On the same thing of the CapEx, we have to be prudent with the permitting. I cannot see the face of Mike because he's in Alpharetta in the U.S., but I'm sure, I'm pushing him as hard as I can to accelerate, because the demands are there and customers are expecting us to produce. So you can, to be safe, mid-2024, summer 2024, we'll get to the run rate in the second half of 2024, so 2025 is secured. If we can do it earlier, we will do it, obviously. So we target to, you know, December 2023, but, we don't own, you know, and control the permitting, right? That's something we're gonna work on. What was your second question, Mubasher? I was just trying to figure out what kind of investment could be needed to get to EUR 2.5 billion by 2030. Is that kind of an incremental or I don't know, is another one of these or another two, three of these plants coming online? Yeah. to kind of enable you to get to that EUR 2.5 billion? It's too early for the third question. We'll share with you know. We'll give you more color as we share with you and discuss through webinars like this one, which are very useful, I hope, for you and definitely we enjoyed it. Our plans, we are working on different plans, be it in Asia Pacific, not all through. You know, we may look at alliances rather than, you know, doing it on our own. Depending on the market, on the geography, we will look at different ways of doing it. We'll come back to you on our CapEx envelope. What you can expect from us is now that the free cash flow generation has been extremely robust, disciplined, proven in the company, and that was my first target is that, we'll continue and discuss generation. Generation enables us to invest in what it takes to stay leaders and to continue innovating, right? Specifically in areas where we are the number one and we know we can win. You know, the market is real first. It's really real. It's profitable. We can win, and we have differentiation and then it's worth it obviously from the returns point of view. We have no other questions. Back to you for the conclusion. Thank you so much to our presenters today and for all of your great questions. As always, the investor relations team is here. If you have additional questions, we're happy to respond. Again, thank you very much. Ilham, would you like to say any closing remarks? Yeah. Thank you very much. I think it's the first time we're running such webinar above and beyond our ESG webinar. I think I enjoyed hosting our team. Thank you, Maurizio here. Thank you, Mike in Alpharetta. We plan to actually do it again. Thank you, Jody and the IR team for a good job and Karim. Thanks to you all. Bye-bye. Thank you. The team. Ladies and gentlemen, this concludes today's conference call. Thank you all for your participation. You may now disconnect.