Hello, and welcome to the Tessenderlo Group 2023 Results. My name is Caroline, and I'll be your coordinator for today's event. Please note this call is being recorded, and for the duration of the call, your lines will be on listen-only mode. However, you'll have an opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your questions. If you require assistance at any point, please press star zero, and you'll be connected to an operator. I will now hand over the call to your host, Luc Tack, the Chief Executive Officer, to begin today's conference. Please go ahead, sir. Thank you. Good afternoon to our European friends, and good morning to our American friends. Thank you for joining us on this investors call today, and thank you for your interest in our company. Today, I'm joined by Miguel de Potter, our new CFO, who will be explaining to you our numbers, and I also have Cedric and Kurt, who you all know, with me here in the room. So let me turn over to Miguel to start, to give the highlight on the numbers, to give the explanations. After his explanation, I will give you some flavor on what happened in 2022, 2023, and looking forward in 2024, in an attempt to make sure that we connect all the dots and that things are very clear and understandable to you all. Miguel, please, the floor is yours. Thank you very much, Luc. And welcome everyone to this investors call for the figures of 2023. We will start our call by going through our key events that have marked the year 2023 and some events going forward that we can expect for 2024. The first event was our share repurchase program that we started in May 2023, where we started a program for buyback of shares not exceeding EUR 40 million. At the end of December 2023, we reached EUR 32.4 million at an average price of EUR 28.21 per share. Following the authorization by the extraordinary general meeting, we have the right to continue purchasing treasury shares. Leadership changes after a very long period serving as chairman and CFO, COO of Tessenderlo Group, Stefaan Haspeslagh has decided to leave the company. We welcome that decision at the end of December 2023. He will continue to serve until the next general assembly as the chairman of our company. On the first of January, to replace Stefaan, I joined Tessenderlo Group as the new Tessenderlo Group Chief Financial Officer, and my colleague, Sandra Hoeylaerts, also joined our executive committee, as the Chief Transformation Officer. Together with Luc Tack, that you heard earlier on the call, we are forming the new executive committee of Tessenderlo Group. Further that, and more back into the business, we have decided to invest in a new ferric chloride production capacity for our Kuhlmann site in Loos, in France. This ferric chloride capacity expansion will allow the Loos site to be one of the largest in the world to produce coagulants for sale in the European market. We believe that it is a predominant market for us going forward, and as the demand increase, we will seek to increase the capacity. The works will start at the end of this year, and we anticipate a first start-up during 2026. Our U.S. plant in Defiance is on schedule, and the plant will be delivered by the end of 2024. This plant will work for our agro business, producing the likes of Thio-Sul, KTS and K-Row. So we expect the first batch of production by the end of this year, although the first results will be visible in the 2025. We are very happy to be able to offer a new production facility in this region of the world, very close to the Midwest agriculture communities. But we are not only building in the U.S. for the agro sector, we're also building a plant in Geleen in the Netherlands, also predominantly to produce Thio-Sul. This plant will be ready earlier than the one in the U.S. and should be operational right before the summer or at the early start of the summer, and will contribute for about six months to our results. Our new headquarters for Picanol in Ieper, Belgium, are being finalized, and by the end of 2024, we plan to move the old headquarters from Picanol to the new ones. And it is on schedule and on budget as well, which is important. We'll go then to the 2023 results and the main operational figures. Revenues came to EUR 2,928 million, down 11.8% compared to the pro forma figures, or Adjusted EBITDA came to EUR 318.7 million, down 32%, 31.8% from the pro forma figures, which is in line with our outlook announcement last year, or EBITDA margin for the whole group is about 10.9% compared to an EBITDA margin of 14% last year. We generated definite cash flow from operating activities, close to EUR 220 million, compared to the same amount last year. But we increased our capital expenditures plans and disbursements. Our capital expenditures were EUR 178 million compared to EUR 134 million last year. Half of those, or a little bit more than half of those capital expenditures, are actually due to growth and not to replacement of existing assets. So we still believe, definitely in the segments we are investing in, and we see growth potential in most of the segments, as we highlighted in our key investments a few slides before. Our group revenue per segment, with the integration of Picanol, has changed slightly, where last year we still had 69% of our total revenues coming from our Agro and Bio-valorization business. It's now down to 52%. You see that the Picanol integration under the machines and technology segments is currently falling. For EBITDA segments, we see that the agro and bio-valorization are still a large portion of our EBITDA contribution, 41% this year, but compared to 66% last year. Machines and Technologies, basically, the Picanol Group is accounting for 14% of our EBITDA today. So let me go a little bit more in details on a segment per segment, so that you can have a view on how those markets have developed for us. So we'll start with the Agro segment, for which we count four different companies, Crop Vitality, Tessenderlo Kerley, NovaSource, and Violleau. This segment has actually been impacted by negative volumes and, well, lower selling prices. Lower selling prices were also affected by high valued inventory that we were carrying on from 2022. This is where you see an 18.5% top line decrease from EUR 974 million to EUR 793 million. You also see a decrease in our Adjusted EBITDA because of a decrease in our margin by 52.5%, our Adjusted EBITDA margin remains in the low double digits at 10.4% for the Agro segment, compared to 17.8% last year. Within the Agro segment, the EBITDA of NovaSource increased, helped by the contribution of new products. On the Bio-valorization segment, we have two companies, PB Leiner and Akiolis. There, we saw that actually the decrease and lower revenue was mainly due in the timing of the second half of the year, and it was due to both less volume and less pricing. So the decrease is not half as harsh as in the Agro segment. So top-line decrease is 9%, or EBITDA, definitely is decreasing faster because of an erosion of the margin and some inventory write-offs as well. Or adjusted EBITDA margin is decreasing from 14.3% to 6.9%. Our Industrial Solutions segment, which is comprising the companies DYKA, Moleko, and Kuhlmann. Kuhlmann, for which we have—we are investing in a new chlorine fabrication process, as I mentioned earlier in this call. There, the Industrial Solutions segment held basically steady throughout the year. DYKA has suffered on the construction volumes in general, as the entire European market has suffered on and contracted in the construction sector. The revenues of Moleko also decreased because from 2022, at the end of 2022, we stopped a contract with Barrick Gold, which was one of our major contracts. But we managed to improve the margins at Moleko to mitigate the loss. DYKA also included new plants in France for the full year 2023, which helped getting recovering some of the volume lost on the other plants. And Kuhlmann has actually been favorable for and a growth potential for the entire Industrial Solutions segment. Therefore, we even managed to increase our EBITDA margin and have a relatively similar EBITDA as last year. Our Machines and Technologies segment, which comprises the Picanol Group, that was merged in the course of 2022. We're talking about the three companies, Picanol, PsiControl, and Proferro. There we can see that we had lower volumes. However, Picanol Group managed to have better margins on its sales. Top line decrease of 15.2%, but we have managed to get an EBITDA margin of 7.3%, which is an increase compared to last year of about 41%. The T-Power segment. T-Power, relatively stable segment. However, we were impacted by higher efficiency payments linked to gas prices in 2022, with very high gas prices, which we didn't have in 2023. We are still operating under the gas tolling agreement with RWE, and we will continue to do so until mid-2026. RWE, during the year, has decided not to exercise its option to continue the gas tolling agreement or extend the gas tolling agreement for the next five years. We are currently assessing and exploring options for the plant beyond the period of 2026. Our adjusted EBIT to profit in details, our EBIT amount to EUR 120.1 million. We've got some small adjustments here and there. Our finance cost and income have a net value of -EUR 3.6 million. This is a difference between our interest expenses, interest income, or foreign exchange translation, as well as a profit on the sale of shares of Rieter, a Swiss company, shares that were held by, the Picanol Group, to come to a profit of EUR 114.4 million. We also managed during the course of the year not only to generate operating cash, but to reimburse our debts and to go from a net debt to a net cash position, where you see the adjustment. Last year, we finished the year with a net debt of nearly EUR 60 million, and now we have a net cash position of EUR 10 million. In the meantime, we purchased shares or own treasury shares for an amount of EUR 32.4 million, and we paid a dividend to shareholders. So even by spending EUR 72 million to remunerate our shareholders, and to have one of the record CapEx years ever, we still managed to generate cash going forward and value for the company going forward. Our outlook for 2024 and some of you might say we are somehow conservative, but we, we believe we are realistic. Our current outlook, and as we see the market, is relatively stable operations and that we do not expect big variations between the EBITDA of 2023 and the EBITDA or Adjusted EBITDA for 2024. But we will continue to monitor the situation, and in our call in August for the half-year results, we will give you an update on where we stand. Giving the results of the year, we will propose to the shareholders at our annual shareholders meeting to approve a gross dividend of EUR 0.70, EUR 0.75 per share. Our annual report will be available on the website, as from April the 5th, which is next Friday, together with our sustainability report. And I will finish off by giving you some update on the financial calendar. We have decided to organize an analyst and asset manager day here in Brussels on April the 29th, for which we will give you further details, later next week. The annual general meeting of shareholders will take place on May the 14th, and our half year results are due on August the 21st. I will give back the word to you, Luc. All right, well, Miguel, thank you. I think you did very well for the first time here at the company, and you already mastered our figures quite well. So thank you for that, Miguel. So let me first tell you that I, in some kind, this may surprise to you, I'm amazed with the results that we were able to achieve last year, despite of all the headwinds we were confronted with. And I will go more in detail to this right now. As you know, we have five segments, and so we have the segment, Industrial Solutions, T-Power, and Machines & Technologies, where we may say the variances compared to 2022, compared to 2023, are minimal. So let me then focus a little bit more on the Agro and the Bio-valorization segment. On the Agro and the Bio-valorization segment, what you will see if you add up the EBITDA, the EBITDA of both segments in 2022 was EUR 287 million. The EBITDA in 2023 is EUR 132 million. Now, that is almost half or a little bit more than half. And so, thank you for listening to what I'm gonna explain to you. I'll try to do it in detail so you really understand what dynamics are playing in the market and for our company. But like I said, also in the market, because this is not limited to our company. So let me first explain to you why in 2022 we had such strong results and such high results in both of these segments. Well, if I would call it like, I watched the Tour de France, it was a course that we were riding with the bike. We were going downhill, and we had the wind in the back. This is really what happened in 2022. So, in 2022, we had an higher intake from our customers in respect of potash and our customers building inventories as they were seeing that the prices were going up. In Flemish, we say, "...," that is definitely something that we saw with the customers, that they started piling up inventories because they said, "Oh, my God, prices are going up. Let's fill up our warehouses." It worked kind of well for us because we had also cheap inventories, and we were able to sell that with strong margins. That for sure contributed in 2022. And then even in the production of 2022, we were still taking advantage of our purchase contracts, which were there at the lower levels. And so by having these good purchase contracts, that also contributed to high margins in 2022. In 2022, we had a minimal to, let's say, no impact, as in respect of the inflation, as a consequence of the COVID and the war in Ukraine. I would like to remember everybody at the beginning, when the war in Ukraine started, we all thought this was gonna be a short-lived conflict. The bio sector was running like stellar, was going very strong. We were getting extremely high prices for all our fats going into biodiesel. And we were also getting very good pricing for our bio fertilizers that were increasing and selling well. At the same time, like for our PVC plants, we were getting very cheap recycled products. All of that in the positioning of the company, like we have been doing over the last years into moving the company into a greener company, more bio products, less CO2 emissions, really going into that direction, and the biofuels for the green transition for biodiesel, et cetera. So all of this led to a very strong 2022. Then from 2023, what happened? Well, we were confronted with inflation. Inflation that really started to be very strong. I think you all will recall that in the beginning, people were saying, also the Fed and everybody, "Inflation is going to be transitory. It will not stick. It will not stay long." But much to our surprise and, I think to most people, inflation became very sticky and became very strong. The inflation led to a lot of cost increases. So especially in the second half of the year, we had to... We started in the first half of the year, but in the second half of the year, we had to increase our prices a lot. The price increases that came along led to serious resistance with the customers because the customers were afraid to buy. They had cheap inventories, and also at the same time, cost of capital started going up, and everybody started also working on the cost of capital. And that is something that we especially saw in the second half of 2023, that customers were just buying hand to mouth and not anything more. On the other side, we had our suppliers. Our suppliers were demanding high price increases as a result of the war. The result of the war have been, and the sanctions have had a serious impact on our business in 2023. And please allow me to walk you through the consequences. For decades, for 40, 50 years, we had been buying our Muriate of Potash from the mines in Belarus and Russia.... I want to tell you, the Belarusian mines are at 1,300 kilometers from our plant in Ham. So in a sense, close by when you look at the roads, right? So as the sanctions started to kick in, in 2022, we were very reactive, and the discussion started on the sanctions, and we still loaded up quickly our warehouses and rented warehouses to fill up our warehouses in 2022 with the Belarusian material and the Russian material. But of course, all of that disappeared in 2023. I had to get into another plane, fly to North America, and I had to beg to get MOP from Canada. So we had to change our supply chains, and that came at a high cost. At the same time, I must remind everybody, as we make our MOP into SOP, at the same time, we make the HCl, which is used also for water treatment production, which is a crucial thing in Belgium. And also, Belgian Prime Minister contacted us to make sure that we kept HCl flowing so that we can keep supplying ferrochlorides to the market, which we, as a responsible company, which we did. Then, so to give you an idea on the logistic chain, today, we are buying MOP out of mines in Saskatchewan. The product is getting loaded on unit trains from the middle of Canada, is being transported to Vancouver. In Vancouver, it is there loaded into vessels, then shipped through the Panama Canal to Antwerp. Just imagine the cost that it takes and the working capital and the effort it takes to get these MOPs as a result of the sanctions. Then, in respect of the raw materials for the Bio-valorization, also there, the raw material prices at a certain point, quadrupled. It is no secret that the pig herds are being reduced in Germany, in Holland, in Belgium, and yet the producers of gelatin are all fighting for less raw materials, and this led also to high increases. High increases, which we then passed on to the customers, but then the customers went on a buying strike, you know, because they couldn't afford to pay these high prices, and also they were working on their working capital and reducing their inventories. Then in respect of the bio market, what we have seen is that the consumer in times of more economic hardship is turning away from the bio market and is buying less bio products. Also, this resulted for us in a drop of sales of bio fertilizers, and was a very severe headwind for our company. So all this combined, more expensive raw materials, expensive energy, upcoming labor prices, make it at the end that we had a drop in the earnings. So then when we talk about, for instance, Asia. In Asia, where we have our competition, for instance, from Japan, what did we see there? In Japan, we saw no inflation. In Japan, we saw in 2023 negative interest rates, and we saw a yen tumbling down. I think today the yen is at 165 against the euro, where it has been years ago when we were having very strong results, 100 against the euro. So there also, we had a headwind in competition. Then there is the emerging markets and the financial constraints in the emerging markets. Our working capitals in local currencies, both in Turkey, South America, and emerging markets, devalued because of the currencies in these countries that devalued. Again, this was a headwind that we were facing. Also, a credit crunch with customers. We are seeing that in emerging markets, customers find it very difficult to get credits, and even so, into Turkey, lately now, up to 70% interest rate. All of this is having severe, severe effects. So I hope in a nutshell, that you kind of understand the dynamics that happened in 2024. But I must say, at the end of the day, that I am pleased with the results that we have been able to achieve. And to me, there is a huge gratitude that goes through all my colleagues and collaborators here at the, the group, which were so productive and so hardworking to navigate all these headwinds and all these difficulties that we have. So now looking forward, and what are we expecting looking forward? I'm sure you're all interested in that. So for 2024, we are expecting a slight pickup of the market. We see green shoots, we see an improvement in the market, but this is gradually, and we want to be careful. Secondly, I must tell you that sanctions are still a big headwind for European companies, and especially a big headwind for our company. Where at the beginning, we saw that the sanctions on the, MOP was working, in some way, where production capacities in Belarus and Russia reduced because they could not sell the product. This has today completely reversed. Their mines are shipping MOP from Belarus and Russia worldwide and running again at previous volumes. These volumes are then shipped to all countries except Europe, all of Americas, Asia, and the Middle East. And then we are confronted to compete against these products while they have a lower cost, because of sanctions, they, they sell cheaper, and we are working with higher costs. However, since the quality of the products that we make and that we always focus on quality, we still see that we are able to sell and that we are even able to see some progress in the market. But I think this is something that we should not underestimate what our Western industry is confronted with in chemicals. It is, first of all, for nitrogen, for urea, you need ammonia. 40% of the ammonia capacity in Europe is currently standing, okay? Because of the expensive gas prices. So this is really a challenge for the chemical industry, and I think for our industry as a total, it is kind of underestimated the cost of the war and the associated sanctions, which really apply to European companies and not to other companies in the world. Even from statistics and shipping statistics that we follow, North America is buying more fertilizers from Russia than ever before. So these trade flows keep going, where we in Europe are not benefiting from these trade flows anymore. But having said that, I remain positive. I believe in our company, and I believe in the strength and the agility of our people, hardworking and also smart working, our R&D and our product development. For 2024, we're expecting that the first half year will still be under pressure, but we see gradual improvement towards H2. Because in H1, we are still flushing out expensive inventories from last year, which are being sold at bad margins. However, we are starting to replace these raw materials, these inventories, with better raw materials. And we have this mentality of this company of, that we focus on what we can do and that we, on which what we have impact, and then try to manage the things on which we do not have impact, yeah? Like the war and the trade wars and the sanctions and the inflation. Okay? I find that our outlook is that we are presenting to you as a good one, in view of all the headwinds that we are facing, and I'm very motivated. I always say we are a strong company, we have a strong balance sheet, but it are not the strongest companies that survive. It are the ones that adapt themselves to changing situations that will survive. And it is with that spirit and that mentality that we are looking with confidence into 2024. So this is... I will stop here now, and now we will open the floor for questions. I give it back to you. Thank you, Luc. Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. We will take the first question from line. Wim Hoste from KBC Securities. The line is open now. Please go ahead. Yes, good afternoon. Wim Hoste, KBC Securities. I have quite some questions. Maybe I ask them one by one. First, can you comment a bit on the weaving machine business? I think second half results showed a significant drop versus first half, and my impression was that yeah, order books were in relatively good shape. So can you maybe elaborate on yeah, what happened in the machine and technology division, and also the outlook for that business? How well filled is the order book? What kind of margins do you expect for for 2024? So, on the business side, what I can tell you, I even have customers that I'm seeing tomorrow in Ieper, is that in emerging markets, the customers have been confronted with financing problems. You should understand, Wim, that the textiles are mainly produced in low-cost countries, and it are especially the low-cost countries that have had to ask for IMF help to distance of our markets, which made the availability of hard currency was not there. So this is something which is not limited to Picanol, of course. This is something that the whole textile machinery making industry is confronted with. As you know, I am a director at CEMATEX and the president of CEMATEX, the machine maker federation. In that respect, I have a good view on European markets and world markets. And so what we are seeing at Picanol is something that we see in the whole industry. So now, we feel there are also some green shoots, eh? But it's still too early to comment what is going on there. So but for sure, the availability in the market has reduced. But also, what is somewhat troubling us is that, the drop in the yen, the Japanese yen, where we have our two strongest competitors on our airjet machines being, Toyota and Tsudakoma. Even when I look at their numbers, because they are listed, Tsudakoma is making a loss, despite the advantage that they have of no inflation, and the cheap yen. So, but to summarize, I think we have seen the deepest in the market, and I think from here onwards, it will progress. A lot will depend also on the strength of the US dollar. This may surprise you, but we find that if the U.S. dollar remains strong and if interest rate cuts do not occur in Europe in the US as planned, and the dollar remains strong, that remains a handicap for investments in emerging markets. So, Okay, no, that's, that's clear. Thank you. Then I have another question on the outstanding shares. I think, yeah, there's a big portion of your capital still in the Verbrugge shares. I think previously it was hinted that because of a fiscal arrangement these would not be immediately canceled, but at a later stage. So I was wondering if you could confirm that's still the plan and by when that cancellation of those shares might happen. Yes, Wim, indeed, this is what we communicated earlier, and this is still the plan. But there is a process that we need to follow, and we expect that we will cancel those shares before the end of the year, in the third or fourth quarter of this year. Okay, that's clear. Then a question on T-Power, if I may. Can you elaborate on what the options are for you? And also, now that the tolling agreement has been, yeah, stopped, I think it's still, yeah, two years to go before before the contract to end. But what kind of options are you looking at? And also, does this, yeah, this halting of the tolling agreement, change anything to your ambitions to build a second gas fired power plant in Belgium? Well, if I may give some clarification on that, then of course, our tolling agreement is still running till end of June 2026, right? So we still have time to investigate the optimal options going forward after June 2026. We are in full process of looking at all these options, and hopefully, this time next year, which will then still be plenty of time, we will be able to shed some more light on this. But currently, we are investigating all options. In the respect of the new gas plant, despite us having our permit, you may know or you may not know, but we had an appeal. You know what drama happened with Ineos here in Antwerp, and we didn't want to have a problem with that ourselves, and therefore, that project is on ice until we understand clearly what it is going. In the respect of an eventual investment into it, this will rather be- this will only be considered if we are convinced that that will be a profitable investment for the company. In that respect, it will depend on what the requests, what the auctions will mean in respect of capacities being auctioned going forward. But I want to make clear, we will not do adventurous or crazy things. We will, in that respect, always work from a safe situation for the company. Okay, understood. And then a last question for me would be on the inventory write-offs. I think the press release mentioned that there was a EUR 15 million inventory write-off taken in Bio-valorization. I was just wondering if there's also that kind of impact in other divisions, accounted for in 2023, or if it was just purely on Bio-valorization? Well, it's, indeed, you're reading our press release, quite well. We have, Bio-valorization is making up for, basically a little bit more than half of the total write-off. But you will be able to, read more in details in our annual report next Friday. Okay, very clear. Thank you. Thank you. We will take the next question from line, Christian Faitz from Kepler Cheuvreux. The line is open now. Please go ahead. Yes, sir. Good afternoon. One question remaining, please. Can you please elucidate why your taxes were so low in 2023, also your tax rate in relative terms, and what we should assume for 2024 as a normalized tax rate? Thank you very much. Yes, we can elaborate about that. Well, we've seen that our tax rate, we're paying our taxes everywhere we need to pay. But indeed, we are using our deferred tax options to minimize our tax rate, but our theoretical tax rate is 26% for the group. Okay, thank you very much. Thank you. There's no apparent further question at this time. Well, thank you then all for, for dialing in, this morning and this afternoon, depending on where you are. Thank you for the interest, in our company, and, remain, assured that we are all doing our almost best and, working day and night, to, to, serve the community, to serve all the stakeholders of the company, and, to make step-by-step, progress. Thank you all. Thank you very much. Thank you for joining today's call. You may now disconnect.