Hello, welcome to the Umicore full-year 2022 Results Call. Please note this call is being recorded. For the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end. This can be done by pressing star one on your telephone keypad. I will now hand you over to Mathias Miedreich to begin today's conference. Please go ahead. Thank you very much, and also a warm welcome from my side for our 2022 annual results call. I have the pleasure to be in the room with Wannes Peferoen today, who has started as CFO of Umicore in October last year. Wannes will introduce himself later, but I can already state that I'm very happy that he joined the team with his broad and deep experience of Umicore, not only from a financial perspective, but also from his experience in operations and in a business role. As I said, Wannes will use the chance to introduce himself in a minute. If we go to the agenda, of today's call on page three, you will see that we start, as usual, with some highlights of 2022 before I give you more flavor on the different businesses, that we have, the three business groups. I hand over to Wannes to give you a deep dive on the financials before I will cover our progress in sustainability and ESG and provide an outlook for 2023. As usual, we will have questions. Let's go now to page five, where we will talk about the key figures of 2022. 2022, as you all know, was a year marked by multiple external events that had significant impacts to the global economy and also to the end markets that we were in. With that, we are very proud that we have achieved a strong result, a strong result in earnings, but also especially in revenues, up 10% year-over-year, despite this significant macroeconomic headwinds. In this environment, Umicore has again proven its resilience and operational excellence because the adjusted EBITDA is the second highest in the history of the group, standing at EUR 1.2 billion below the record levels of last year because of the cost inflation environment and the less favorable precious metal price levels that we have seen, but also because of an increased spending that we have done for innovation and growth preparation. I will cover that aspect in a second. Wannes will give you further granularity on the building blocks of this as we think strong and robust results in front of all of the headwinds of 2022. A strength that is, by the way, also visible in our return on capital employed, that is reflecting a significant value creation at 19.2%. On the next page, we have a reminder of what we have introduced last year, our RISE 2030 strategy, and we can say two things to that. First of all, the underlying megatrends that we have been defining for that strategy are not only confirmed, they are really accelerating, and there's also a portion I will cover a little bit later. It's also a fact that we have covered already quite some significant milestones in achieving that strategy to build the foundation for the growth, and that's what I wanted to share with you in the next 2 slides. On slide number 7, you can see that we have made significant progress indeed on the customer side, closing value creative contracts for all of our businesses and especially the battery material business. The joint venture with Volkswagen clearly was, as we think, a milestone and even benchmark for the industry. It's a strong signal of recognition of our products technology and process expertise, and we have even enlarged that with an MOU that we have signed with Volkswagen, with PowerCo, for the North American business, also giving good momentum for our regional expansion, but also with ACC. We have made very good progress on a long-term supply agreement backed by Stellantis and Mercedes as their shareholders. Also outside of battery materials, we are clearly recognized as the reliable transformation partner that we want to be. An example would be the Mercedes Supplier Awards 2022 that Umicore has achieved with also this in mind. Overall, very good traction on the discussions with the customer side on our battery material business especially has been increased acceleration in the second half of the year with OEMs and cell makers. I can confirm that we are fully on track for what we have said earlier, a ramp up of our business already significantly visible in 2024, starting already at the end of 2023. Also we have made major steps in the technology portfolio in our innovation ecosystem, a strong IP creation over the years. If I want to pick one specific topic, it is the HLM technology that we have brought into industrialization this year and also prepared this last year, of course, with a lot of research work that has been done to solve two of the key issues. I will go more in detail in the Q&A if you want. To solve the two key issues, technical issues that were standing in front of it, the stability of the material and the conductivity. With that, we see a market introduction of 2026 of this solution that is catering the needs of the design to cost market that currently LFP is sitting at lower cost and high performance. I can give you more flavor in the Q&A if you want. On the next page, we see another very important success, and this is the success of regional value chains. You know that battery material and the battery business is and will even be stronger in the future, a regional business with regional supply chains. With the opening of our Nysa plant, we have confirmed our leadership position in Europe to be the only company with a gigafactory up and running, and the company with the largest supply chain integration outside of China, from refining, PCAM, and CAM. We were very happy to supplement it with one very important agreement on the raw material supply, nickel, which, you know, is one of the, if not the most important ingredients. We have secured a long-term supply of low CO₂ nickel from Finland, from Terrafame, that are working on a breakthrough process of bioleaching to bring the nickel in a very CO₂ efficient way. This is completing our picture for the ripping side. Also we are further progressing on the expansion plans that we have in Canada, dealing with all the momentum that we have through the IRA. Also in the clean mobility ecosystems, we have made significant steps up, and ESG roadmap is something I will cover a little bit later in the document. Very good progress on implementing proof points for our strategy, setting the foundation. Now let us share a little bit more granularity on the different business groups, starting with Catalysis and their 2022 results. First of all, the underlying market, the most important market for Catalysis is the automotive market, to be more specific, the combustion engine automotive market. As you can see here, two messages. This market is still a big market and will continue over the time to be significant. However, it didn't move much in the last three years. We know all the reasons for that. It's supply chain constraints. While the end consumer demand is there, OEMs had to take down their production target, creating a quite volatile environment of many changes in the supply chains, with levels that are still significantly below the pre-pandemic levels. If we move to the next slide 12, it is even more impressive what our Catalysis business group has achieved against this backdrop. Another record performance in 2022, with both revenues and earnings exceeding the previous results achieved in 2021, up 5% and 4% respectively. The adjusted EBITDA stands at EUR 490 million. Largely offsetting cost inflation through increased operational efficiencies and also a quite strong passthrough ability into pricing. We keep the EBIT margins well above historical levels with 23.6%. Very strong performance by Automotive Catalysts that I will cover in a separate slide. Also Precious Metals Chemistry activities were quite performant last year. In Fuel Cell & Stationary Catalysts, we had revenues that were in line with 2021. That was caused by the shutdowns or lockdowns that we saw in China due to COVID. Very good progress on the customer side. Additional contracts closed with commercial vehicle customers in China, which is the biggest end market, as well as good traction on implementing what we had said last year is a fuel cell catalyst plant in China that is on track to be ramped up. A little bit more deep dive on Catalysis because we have to want to make sure you understand the root cause of the strong performance. First of all, it's the strong market position. The leadership position has clearly been confirmed through the 2022 results, through market share gains in nearly all global markets, especially in China. This is a proof point as we see it, those results. From an operational side, the strong cash flows that we have projected for our Umicore 2030 RISE strategy are fully on track, are confirmed. Especially the resilient, and I have to say flexible operating model is really paying out in an environment where probably volatility will, if at all, increase in the future. That's a strong asset to have, and we're very confident on the value creative nature of that business. Also on the long term, because now Euro 7 has been confirmed to be a value up for the market and a way for Umicore to even further differentiate through technologies. The good thing is also that we're continuing our strong market success with good progress in securing Euro 7 platforms with several customers. Altogether, our revenue profile is structured very beneficial because we are with over 80% of our revenue in the longevity segments, so the light-duty vehicle gasoline market as well as heavy-duty diesel. That's a strong base where our teams with their operating model and strong abilities in execution have really made a great year. Next to cover is E&ST, Energy & Surface Technologies on slide 15. Before we go into the review of the performance of E&ST, it's important for me to note a change in the revenue definition that we have decided to apply from 2022. As lithium and manganese are increasingly valuable and volatile components in Rechargeable Battery Materials, it was decided to no longer treat them as consumables, but as hedged metals in order to make the accounting approach consistent with the revenue performance indicators used in Umicore's other business units. Now, the pass-through value of purchased lithium and manganese will therefore be excluded from the revenue calculation, as it is currently already the case, as you know, for cobalt and nickel and the E&ST 2021 and 2022 revenues have been restated accordingly. I think this is giving also much more clarity and transparency on the fundamentals of the business. Now on page sixteen, we again highlight the fact that electrification is not only confirmed, it's rapidly accelerating. It's driven by the stick and carrot approach in the different regions. U.S. providing more carrots with the IRA and the stick in Europe with the combustion engine ban from 2035. That is now fully confirmed. You might have heard that the European Parliament has put in a proposal now to even extend that quasi ban to the commercial vehicle side, where now for 2040 a 90% reduction of CO2 is proposed, which of course would be another strong accelerator of that, you know, of that demand. Also the availability of renewable energies is making strong steps forward. The war and the subsidies can really be seen as a catalyst of renewable energies. The International Energy Agency, we just saw a report this week, is forecasting 2.4 terawatts new renewable energy capacity be installed until 2027, which is actually the current power production of China. It's gigantic. You could basically say that the energy crisis is a catalyst, as COVID was for the renewables, as COVID was for communication technology. Now for us, of course, that's a good news in terms of the addressable market. For the industry it provides also a significant challenge because the supply demand situation in the different regions is by far not balanced, which we will show you on the next slide, which is slide 17. You can see that today already in Europe and in North America, the demand and the supply are not balanced between needs of electric vehicles for batteries and battery materials and the capacities of CAM in this instance. You can see that this gap is continuing at least into 2030. What is today done, obviously this gap is bridged by importing materials from mostly Asia. We also know, and I think agree that this will be more and more difficult, if not impossible, mainly because of three things. You have the local content requirements that are posed by subsidies, and also the geopolitical fences. You know, the carrot and the stick approach. More simply speaking, it is the CO2 requirements of the car manufacturers that want to go down, that need to go down in their Scope 3 emissions. With that, a large transport of thousands or millions of tons of material is simply not possible across continents. Last but not least, the lessons learned from the microchip supply chain crisis, is that you have to have reliable supply chains being close to your customers, and that's what the customers want. The consequence, we can see a potential undersupply of CAM until 2030. Of course, these are all announcements today that can change. I'm personally scared also about the announcements in a way that, we know Umicore's strength in building capacities. We don't know that of all of the markets. You can also, if you want from the green bar discount even 10%-20% of the capacities that will never come true. Last but not least, it does not include yet some other effects like in the U.S. I would expect that the IRA will drive up even more the electric car production, which is, you know, the reason why the IRA is existing. In Europe it's not yet including the commercial vehicle demand that we just have talked about. Altogether, quite a tense situation and for companies that have existing supply chains in the regions or just building it up like we have in Europe and building up for North America, makes us quite confident that we can be of significant advantage to our customers with that in the future. Ultimately, this will be an advantage for Umicore. A little bit more flavor on the 2022 results of the E&ST segment. We had higher revenues and earnings in the business group. Quite substantial increase of them in Rechargeable Battery Materials. The sales volume of cathode active materials from our legacy contracts remained as we had anticipated and previously, I think, discussed and communicated, subdued. Revenues and earnings were, however, well up year-over-year, including also favorable exposure to the lithium price in 2022. This also we had shared at our half year results. This sensitivity of the revenues and earnings to the lithium price will, as discussed before, decrease throughout 2023 and will be further minimized from 2024 through the way we have structured our contracts and through hedging mechanisms. Over the years, the business unit has made strong progress on the customer side with very good traction on commercial discussions as well as product qualifications. We feel very well on track for what we have said earlier, which is our 2024 volume ramp- up that is in full swing. As a next step in the execution of our strategy, it's our intention as well to group the global Rechargeable Battery Materials activity within one legal entity. This setup will, as we believe, provide the best foundation for the business unit to scale and will give flexibility on financing options to support the growth of the activity within Umicore. Cobalt & Specialty Materials also revenues increased substantially versus 2021, reflecting an exceptionally strong demand and supportive price environment in the first half of the year before an expected normalization of the demand patterns happened in the second half in Metal Deposition Solutions. Electro-Optic Materials recorded both stable revenues compared to the previous year. Finally, last but not least, Recycling. Let's have a look at the last year performance of our Recycling Business Group. Year 2022 was again marked by a volatile precious metal and PGM price environment. As you can see, the average price of rhodium in 2022 decreased versus the record year of 2021. This, of course, is an important input parameter for our business. On the next page, you see that, against this volatile precious metal price environment, the Recycling Business Group indeed delivered another excellent operational and also environmental performance. The revenues in PMR, Precious Metals Refining, were close to the record levels in the previous years, reflecting solid volumes and an overall good availability of complex input materials. The earnings stayed on a very good level compared to previous years. Strong, however, below the record year of 2021, reflecting only a partial ability to offset the significant cost inflation that is, you know, mainly on energy. In addition, the long-term nature of our contracts in this business that only allow for a limited pass-through of inflation during the time of the year. It is a more longer-term process. In the course of 2022, there was another important progress we made in Recycling, which is on the battery recycling solutions. We have created an own business unit for that has now implemented the latest generation of our lithium-ion battery flow sheet into the operations that we are running already since ten years. A lot of know-how and experience has been put in to increase the recovery yields. Also very good steps have been made to extend the customer portfolio with several additional agreements with OEMs and battery makers. Altogether, we are well on track also here. As we said this year, we will decide on the location for our high capacity battery recycling plant in Europe with up to 150,000 tons of capacity. In the same business group, Jewelry & Industrial Metals were also had a strong revenue and performance increase across most of the product lines. Precious Metals Management was slightly below the exceptional strong 2021 year level. With this granularity, I will now hand over to Wannes, who will give you more colors on the financials of the 2020 business year. Thank you, Mathias. Good morning to everyone. Obviously, I'm very excited today. This is my first earnings call as a new CFO for Umicore, and I'm very much looking forward to our future interactions. Let me take a quick moment to introduce myself. I have been with Umicore for seventeen years, and I've had the opportunity to work for different business units across the group in roles in both financial and general management. In my new role, I will continue to focus on performance and on risk management. My personal ambition is to ensure that we stay on track with the execution of the 2030 RISE strategy. Now, let's have a look at the key figures for 2022. As Mathias shared earlier, Umicore's financial result in 2022 was driven by a strong business performance in a year with plenty of macroeconomic challenges. Think of the unprecedented cost inflation, the continued supply chain disruptions, and the volatile price environments for precious metals. Despite this challenging context, Umicore grew revenues with 10% to EUR 4.2 billion. As we mentioned earlier, we now exclude lithium and manganese pass-through sales from our revenue calculation. This will allow us to better compare the business performance in the Rechargeable Battery Materials business unit. As you can see in the graph on the top right, the revenue increase was driven by the business groups Energy & Surface Technologies and Catalysis. In Rechargeable Battery Materials, we benefited from a sharp increase in lithium price during '22, combined with a time difference between, on the one hand, purchases and on the other hand, the sales of the lithium-based products. Going forward, the lithium price exposure has been substantially reduced as we started hedging lithium, as we do for the other battery metals, cobalt and nickel. In Cobalt & Specialty Materials, revenues increased substantially. Here we benefited from an exceptional strong demand and supportive prices for cobalt and nickel, in particular during the first half of 2022. In Catalysis, we were able to grow revenues, largely thanks to the Automotive Catalysts business outperforming the market. In Recycling, revenues were again outstanding and in line with last year's record level. If you have a look at the EBITDA, the adjusted EBITDA amounted to EUR 1.2 billion, which is 8% down compared to the record level last year. As you can expect, the unprecedented cost inflation did create an important headwind in 2022. In the graph on the bottom right, you can find more details on the impact of the external factors on the EBITDA. The year-over-year cost inflation before it passed through to customers resulted in a headwind of more than EUR 180 million. On top of that, the lower price levels for precious metals resulted in EUR 70 million lower contribution versus last year. How did we deal with this cost inflation? In Catalysis, and to some extent in Energy & Surface Technologies, we were able to offset a substantial part of this cost inflation headwind. We did this through a mix of pricing adjustments and efficiency improvements in operations. In Recycling, the bulk of the cost inflation resulted from higher energy costs. These were harder to pass on because the supply disruptions resulted in an increased competition globally for certain recycling feed. Now, the bridge on the bottom right clearly shows that excluding for these exceptional external effects, the group's underlying performance increased substantially year-over-year. The strong performance of the group is also reflected in the adjusted EBITDA margin, reaching 27.3%. In Catalysis, the adjusted EBITDA margin is in line with previous year, again demonstrating that we successfully offset cost inflation. The rapid cost in Energy & Surface Technologies and the energy cost inflation in Recycling did weigh somewhat on our margins. In all three segments, the adjusted EBITDA margins remained well above the target of 20% that we have set in our 2030 RISE strategy. ROCE for the group reached 19.2%, which is still an historic high. ROCE increased in both Catalysis and Energy & Surface Technologies. Now moving to the consolidated P&L, let us first have a look at the bottom line. As you can see, the group shows a solid net result of EUR 570 million in 2022. If you look at some other P&L elements or P&L items, you will see that depreciation amortization increased slightly to EUR 286 million, which resulted in an adjusted EBIT of EUR 865 million. Adjusted net financial charges are now at EUR 125 million, up versus last year, which reflects higher interest charges on short-term loans in line with the general market, and somewhat higher foreign exchange related costs. Adjusted tax charges were lower versus last year, now at EUR 145 million. Next to lower taxable profit, the adjusted effective tax rate for the group decreased to a level of 20% versus 23% last year. The adjusted net profit group share amounts to EUR 593 million, which results in an adjusted EPS, earnings per share, of EUR 2.47 versus EUR 2.77 in last year. The adjustments had a negative impact on EBIT of EUR 32 million and are mainly related to the increase in environmental provisions for legacy items, and also includes restructuring and impairment charges related to the stationary catalyst business in Denmark. Now, moving on to the next slide with the free operating cash flow. Here, I would like to highlight that the free operating cash flow for the group remains strong at a level of EUR 344 million and continues to support the execution of our growth strategy. In the top graph, you can see that the operating cash flow after changes in working capital, this is the dark blue line, reached a solid level of EUR 835 million. The working capital in 2022 increased by EUR 342 million. The higher metal prices in Rechargeable Battery Materials was one of the main drivers here. In the bottom graph, looking at the light green line, you will notice that capital expenditures, including capitalized development expenses, increased to EUR 491 million in 2022. Energy & Surface Technologies accounted for more than 60% of the group's Capex, driven by the expansion of the European footprint in Rechargeable Battery Materials. In the other two segments, Catalysis and Recycling, Capex slightly decreased. I would like to emphasize again that within the group, Capex discipline remains a key focus area. We continue to make future expenses conditional upon concluding value creating agreements with our partners. Moving to the net financial debt. At the end of 2022, net financial debt amounted to EUR 1.2 billion, which corresponds to a leverage ratio of 0.96 times last 12 months adjusted EBITDA. We continue to have a strong balance sheet supporting our 2030 RISE strategy. As you can see in the bridge, net financial debt increased with EUR 144 million versus last year. The solid free operating cash flow of EUR 344 million enabled us to fund EUR 488 million related to taxes, net interest, dividends, and net purchases of own shares. I would like to repeat that going forward, our funding policy remains unchanged, meaning that we continue to have the ambition to maintain our leverage ratio at investment grade level throughout the 2030 RISE plan. As you know, end of last year, we issued a sustainability linked US private placement. The amount of EUR 590 million has been drawn early this year in January. The USPP transaction was a success, in particular considering the volatile financial market context end of last year. It also illustrates the strength of our relationship with institutional debt investors, and it was a strong validation of our 2030 RISE strategic plan. With this, I would like to conclude my section on the financial performance and hand it back to Mathias. Thank you. Thank you very much, Wannes. Not only strong performance on the financials, but also a very good progress on sustainability that we can report back to you. Significant progress in the roadmap that we have called Let's go for Zero, that we started in 2021. In terms of CO₂ reduction, our targets for Scope 1, 2, and 3 have been validated by SBTI. The even better news is that we have even slightly overachieved the respective 22 data point on the glide path that we have towards our 2035 and 2030 target. That's a very good news. Also we are proud that already as of last year, 55% of the energy needs in Europe have been based on renewable energies, quite a high value. That we don't stop and we will further increase. In terms of zero inequality at hand, we have made also good progress in safety. Safety performance was better in the group over the year, but also by actively tackling the topics of water and biodiversity. Finally, we have also set a good momentum in further improving our ESG governance, not only through the implications of TCFD, but also by adding additional committees to our supervisory board, a sustainability committee, as well as an investment committee that will provide further guidance and governance for the development of the group Umicore 2030 RISE and the sustainability roadmap. Last but not least, before we go into the Q&A session, I want to provide you some flavor on the outlook for 2023, starting with Catalysis. Automotive Catalysts is expected to benefit from its strong market position in gasoline catalyst applications, a supply chain recovery, and an anticipated rebound of the Chinese heavy-duty diesel market. Therefore, adjusted EBITDA of the Catalysis business group is expected to show a further good uplift in 2023 versus the already very good 2022. In E&ST, in Energy & Surface Technologies, it is expected that the earnings of the Rechargeable Battery Materials unit will be in line with the 2022 level. Considering that in 2023, the Cobalt & Specialty Materials business unit will no longer benefit from the exceptional profitability that occurred in the first half of 2022. Adjusted EBITDA of the full E&ST Technologies business group in 2023 is anticipated to be somewhat below the levels of 2022. Recycling. Finally, in Recycling, the Precious Metals Refining business unit is expected to continue to benefit from an overall supportive supply environment. Assuming the current precious metal prices are to prevail throughout the year, adjusted EBITDA in the Recycling Business Group in 2023 is expected to be below the levels of 2022 due to the full-year effect of the cost inflation. Overall, adjusted EBIT and EBITDA for the group are expected to be below the levels of 2022, in line with the current market expectations. I want to close this introduction on page twenty-three, where if there would be only three things that you would remember from this presentation, I would ask you to remember that, first of all, Umicore has shown a very resilient, a strong business performance in a volatile market with improving and confirming the underlying performance of the group, its resilience. Second, the megatrends that are based that are the basis for our RISE 2030 strategy are more than confirmed. They are accelerating. Finally, we have taken big steps, positive steps in implementing the RISE 2030 strategy with key milestones, and as we think, proof points for the validity of this strategy achieved in 2022. We are fully energized to tackle 2023 in the same with the same amount of progress. Thank you very much for listening to us, and we are now more than happy to answer any questions you might have. Thank you. Ladies and gentlemen, as a reminder, if you would like to ask a question, please signal by pressing star one on your telephone keypad. We kindly ask you to limit yourself to one question each. Once again, that is star one for your questions today. Our first question comes from Charlie Webb of Morgan Stanley. Please go ahead. Morning, everyone. Thank you very much for the chance to ask a question. Maybe just one on free cash flow and kind of CapEx expectations looking into 2023. Maybe you could just help us and remind us, you know, where you expect CapEx to come out in 2023. You know, how are you seeing the current inflationary environment as it relates to kind of CapEx? Obviously, you've got a lot of spending to do to position yourself for growth. Just understanding the kind of the CapEx profile and kind of remaining on the free cash flow part. Just also working capital, with the Nysa plant now kind of expected to ramp up in 2023, is that already fully loaded when we're thinking about the kind of the working capital or the sunk working capital that will go into that plant? Is that already done, or is that ahead of us? Just so we kind of get a gauge on that kind of working capital dynamic. Thank you. Yeah. Thank you very much, Charlie. It's excellent that the first question immediately goes to our new CFO, so I will hand this over to Wannes. Okay, thank you. Let us have a look at some of the key components, as you mentioned, CapEx, for 2023. I mean, given the valuating agreements that we have concluded, in 2022, past years, we plan to step up CapEx in 2023, in particular for the footprint in Europe. Yes, that's something we anticipate. Looking at inflation with respect to CapEx, that is not something. I mean, we have also programs in place to improve CapEx density, where we also already see benefit in the course of 2022 and also in the course of 2023. From that angle, we don't expect a major impact on the plan, for 2023. Looking at your question with respect to the plant in Europe, where we are, that's where we are, still in the ramp-up stage, I would say, looking at the capacity utilization. Yeah. In respect to working capital, I think the working capital needs in Nysa, they will increase, but more at the end of the period, because as we said, the ramp-up will start end of 2023 and then be in full swing for 2024. That's what you can expect. Okay. Just to gauge a little bit on that, so CapEx, any kind of gauge on where that should be for 2023, relative to up, but maybe more in absolute terms relative to 2022, would be helpful. Just on working capital, I guess, is it right then to assume if we've still got to load the plant in the second half, but we should expect further working capital outflows in 2023. Thank you. Basically with respect to CapEx, I mean, looking at consensus, analyzing consensus, I would say that we don't feel uncomfortable with what we see in consensus. For 2022. Okay. Okay. Thank you. Thank you very much. Now we're moving on to our next question, which comes from Chetan Udeshi of JPMorgan. Please go ahead. Yeah. Hi. Thanks, morning. I had a few questions. First, I'll just start with the mention of carving out or I think, you know, putting all of the RBM businesses in a separate entity. I'm just curious, what is the next step? Because, you know, you also mentioned, Mathias, that, you know, this will be within Umicore. Are you actually ruling out any external participation in this business? Because one would think when corporates announce carving out something as an independent entity, the next logical outcome is either it becomes independent wholly or, you know, there is a link associated with raising financing through that independent entity. I'm just curious what are the sort of next milestones on that business in terms of corporate action side. The second question was, I was just looking at the corporate R&D, and it's good that it's clearly going up. I can also see some of the R&D costs in the corporate line are associated with the new cathode material projects. I'm curious why is this not in E&ST, and why is it sitting in the corporate line? It seems it's more directly related to the E&ST business for sure. The last question on Catalysis. The margins have continued to surprise on the upside here for sure. If I look at second half, the margins are up versus first half. I'm just curious again here, you tried to address it during your comments, but are there some temporary factors, or you think the structurally, the margin level in this business has reached a stage where, you know, EBIT margin closer to 20% is probably gonna be a norm, at least for the next few years? Thanks. Chetan, thank you very much. Three very relevant questions. Let me start with the first one. RBM and what we have said about the structuring of the legal entities. RBM, the battery material business is an instrumental part of our 2030 RISE strategy. It's the growth engine of the group, and this does not change with this announcement, right? What we have said in the Capital Markets Day remains totally true. We are looking on all of the options to finance our business going forward. At this point in time, we don't exclude any options. We have decided to make this step to give, you know, to decomplexify also the, the unit in terms of needed structures like SAP systems or the IT systems. If you do that at an early stage where we are now, before you go into the growth, you have less complexity. Of course, a key reason is also to have all of the flexibilities for financing options. As we are, you know, as we said in the same statement, I just can repeat it. As we are a publicly listed group, we have available, probably all of the options you can think of, and we will make good use of it also for RBM. Now, on corporate R&D, yes, it's a very good observation, and it's mirroring the way we are treating R&D in Umicore. We have a stage gate process where we have everything that has a trajectory of more than five years for hitting the market in terms of innovation is in our corporate R&D department. These are things today, especially, the activity has increased on the solid-state battery activities. You might also remember our announcement together to build with Idemitsu a new battery material, Catholyte, et cetera. This is all in the corporate R&D, so long-term topics, sodium-ion batteries, other technologies that would bring major breakthroughs to that market. That's in corporate R&D. When it reaches the industrialization phase, so that means when concrete customer qualification projects and launch preparations are there, it is handed over to the RBM business group. This has just happened now as we speak for the HLM technology, where we have reached that critical milestone, solving the technical hurdles that were there for industrialization. For that, we bring that then up to scale and scale it up to large quantities. That's the trigger point. Last question on Catalysis. Do we think that's a temporary effect? No, indeed, we don't think that because there are two effects happening right now. The first one is that the preparation on the operations model, so to bring down the break-even points to increase the flexibilities, they really pay off now. That's on the one side. On the other side, we see that the offer that we have to the market, to our customers, where we call ourselves the reliable transformation partners, maybe compared to other contenders in the market that might not have that so clearly, because we live in both worlds, and on the long term, combustion engine and electrification also gives us a good traction on being awarded new businesses in the Euro 7 domain. That is also a largely, you know, helping our equation on the profitability. That's actually what is behind. We see it as more as a step function. Also for 23, as we said in the outlook, we're quite confident that we can continue or even increase the performance of the business group. Thank you very much. Thank you. Up next we have Geoff Haire of UBS. Please go ahead. Hi. Good morning, thank you for the opportunity to ask some questions. I had two questions, if that's all right. The first one, I think is fairly straightforward. If you were to strip out the impact of cobalt and lithium and nickel from the EST profitability for the second half, and then obviously that would apply to the guidance as well for 2023, would you still see profitability down in 2023? It's hard to see where you're, given the movement of metal prices, where profitability is actually going in that business underlying. The second question I had is that we've obviously had the European Green Deal Industrial Plan published or, well, proposals published. What do you understand is the differences that's going to make for the EV business in Europe going forward, if any? Yeah. Let me answer the first question. I'm not sure if I totally understood it, but I will point out the following. What we have said is that we had a step up in revenues and earnings in the RBM business unit inside of the E&ST business group in 2022, and we have said that we think that this will remain for 2023. Now, if you go one level up above the E&ST, which is the wider business group, there is one big change. Not big, a change that is there year-over-year, which is the Cobalt & Specialty Materials that had an extraordinary demand, but also cobalt pricing environment in the first half of 2022. If you look to the cobalt pricing and the end market demand, it has normalized in the second half. We see the performance of that business more going forward with that trajectory. With that, overall E&ST, we said should be somewhat below. The important message, I think, is that the RBM part of it is on track. We also have said that the effects of lithium in 2023 will, you know, will be less like in 2022. We are adding other elements that are more on the operational efficiencies of our plants, ramp up in Nysa, as well as the fact that we are now hedging, as one is pointed out, hedging lithium as a metal and also at the end of 2023, the first of our new projects, if you want to say start, which are stabilizing that. Then, you know, the big step up happening in 2024 in terms of what volumes is concerned. Now, I hope I've answered your question on that. Now coming to the Green Deal question. You have seen that the European Union did not copy one to one what was the Inflation Reduction Act, and I think they shouldn't. What I personally would see is, and what I'm hoping for, is of course on the funding side, there will be more momentum. Already today there is quite significant funding available in the EU. What I'm hoping for, and this I see signals in that regards, that especially on the permitting side, on the speed to market, on the ability to, you know, keep up with the, you know. I've shown you the discrepancy before in demand supply for the cathode material. This is something that I'm sure the European Union will tackle so that we and other companies can even speed up and follow the demand of our customers. Could I just come back on the RBM business? You said there's a step up in revenues and profit. Is that excluding lithium, the impact of lithium in 2022 as well? As a whole. The effects, what I was saying is that the effects of lithium, that we have seen in 2022 and the good results, that those effects will be less in 2023 and that they will tail out in 2024. Then with the volume ramp- up, we are in this new business model where we have, you know, lithium as a hedged metal and we are only measuring ourselves on the underlying business performance. For 2022, if you took away the impact of lithium, would RBM revenues and profits still be up? I mean, there are several effects that go into that. The first one is obviously the lithium, as I said. We have talked about the subdued volume, subdued volumes, which is not in use, which we have said earlier. You have the mechanism which is called the take-or-pay contracts, that are, you know, playing a role in that. Even if the volumes were not as contracted, the expected earnings are contributing. That all work together in that equation in 2022. As we said, 2023 and 2024, the picture will be much more straightened in this regard, which is the important message that we wanted to send today. Okay, thank you. Thank you. And now we're moving on to Sebastian Bray of Berenberg. Please go ahead. Thank you very much for taking my questions. I have two, please. The first is on magnitude of state aid. I suspect the answer might be no, but I'm gonna try anyway. Can Umicore quantify what it is getting or currently for the Canadian plant that it's agreed to build, or just the magnitude of state aid more generally? Is it a triple digit million amount? What is the magnitude, order of magnitude we should be thinking about? The second question was on the moving parts in the Energy and Surface Tech guidance for 2023, 2024 and into 2025. In the near term, so let's look at 2023. If you were to have no lithium impact in the year 2023, so I assume it's still positive, would the earnings in the cathode bit, so just focusing on the unit margins in cathode, be flat, down or up? Just a quick question on the VW JV. For modeling purposes, given data is quite limited at this stage, is it right to assume that everything in the battery materials area is still fully consolidated until 25 and then the JV only really gets going from 26? How should we think about this? Thank you. Let me start. Thank you, Sebastian. Very good questions. First, state aid Canada. Obviously, we cannot disclose our contracts that we have closed and the MOUs with the Canadian government and the Ontario regional government. I can give you so much flavor as the dimensions we're talking about in percentage of state aid versus the CapEx are quite similar to what you see in the IRA in North America. I think the big difference between Canada and North America is not so much in the CapEx state aid rates, or funding rates, but it's more on what's called the OpEx tax credits that's currently in the discussion on U.S. We also hear, but that's public knowledge. The Canadian federal government has announced that they will come out also with a counterproposal for that part, so that they really come at par with what's seen at the IRA. As you have seen, quite a couple of big players have decided for Canada, including ourselves. We rest assured that there will be no differences in state aid between Canada and North America. Anyway, I think that this is not, for us, has not been the reason to invest in Canada, nor in North America. It's driven by the market need and the demand and our customers asking to do that. Overall, it is a value creative business for us in any way. Otherwise we wouldn't have, we wouldn't pursue it. The contracts that we see going forward in that direction is actually saying that yet. In terms of E&ST, I think I come back to what we have said end of 2021. We have in 2022 and 2023, there is a transitory time where we have, you know, legacy contracts that we are very happy to have, and we will fulfill them either in volume or take-or-pay. We have some lithium effects that are strong in 2022 than in 2023, and we have adapted our business model, as we've just shared today, to be more independent of that. The most important message for us today was to go into this ramp up that we can now moving much closer. I mean, it was, I understand it's difficult end of 2021 to anticipate something that has happened in 2024, but now as we come much closer to that event, we can even with more confidence say that we're totally on that trajectory. Now for Volkswagen, the joint venture. Yes, indeed. Remember the Volkswagen joint venture is a 50/50 one, as we have discussed, which means that from modeling purpose, I think the assumption from 2026 onwards to use the respective streams as non-consolidated, I think that's the right approach in the modeling. That's helpful. Thank you for taking my questions. Thank you. We're now moving on to Wim Hoste of KBC Securities. Please go ahead. Yes. Good morning. I have two questions, please. The first one would be on the ramp up schedule for RBM towards the end of the year and into 2024. Can you provide a little bit of additional color on where the growth is going to come from in the second half of this year? Is it mainly Nysa or is there also improvement in capacity utilization rates in your Chinese plants, for example? Also to which kind of customers is that? Is that to OEMs? Is that to battery cell producers? Can you maybe offer a little bit of additional clarity on that? A second question would be on cost inflation from energy to other things. Can you maybe elaborate a little bit on the cost inflation impact you will see this year and what's kind of flow over from last year? What is maybe then new elements coming into the picture? Those were my questions. Thank you. Thank you, Wim. Indeed, it's a good opportunity to provide some more flavor on the customer landscape for RBM. you know, in most of these calls I'm asked about, is there any news on the customer side? I always say there will be a news in some time, and then we share the news. I will do the same here again. We are in quite advanced discussions with several customers and, maybe important to mention customers as well on the OEM side, but also especially on the cell maker side, because with the progresses that we have made on the technology roadmap and on the HLM side especially, that becomes a very hot topic. Now we're also very confident that in the first half of the year, in the first half of this year, we can announce another major step up from a customer side. It will be a good adding to our regional mix. That's what I would like to say here. A regional mix which will more go into utilizing the full global capacities of Umicore in the short term and then help us to transfer that into, you know, a more regionalized setup. I'm sorry, I cannot be more specific. You will understand when once we are able to share the news. I would say that the ramp up will not... My message basically is the ramp up will not only happen in Nysa, it will be starting in all of our global factories because we need to be fast and our customers need the material. Most of those things that will start because of the localization requirements of those customers, over time, they will then either go into the one or the other region. To start with, we can use our existing capacities, and that's an important point to mention. For the inflation question, I will hand over to Wannes. Looking at the expectations for inflation for this year, we can expect that in Catalysis and E&ST, we will be able to offset, given the operational efficiencies that we implement and also some of the volume effects. In Recycling, where we were primarily hit by the inflation last year, because of the energy. Going forward, the energy portion is where we were able to hedge a substantial part of the energy exposure and as such, reduce the uncertainty there. At the same time, looking at Belgium and the specific situation of the indexation, is where we expect a further inflation on the payroll, with the payroll indexation. As we said earlier in Recycling, we are working on the necessary initiatives to offset the inflation, but in this environment, it takes more time. Looking at some of the multi-year contracts and so on, it will take more time to offset it, but it's ongoing, I would say. Okay. Can you provide a number? There was EUR 184 million for 2022. Can you provide an additional inflation number for 2023 based on your current expectations? Again, we will expect still a full-year effect, particularly in recycling. There will still be a substantial headwind. I would say more than half, roughly of that figure. Okay, understood. Thank you very much. Thank you. Up next, we move to Nicola Tang of BNP Paribas Exane. Please go ahead. Hi, everyone. Thanks for taking the questions. Just wanted to ask a little bit more about the tax incentives around the IRA, which obviously have come into place since you made the decision on the Canadian investment. Considering also, Mathias, you know, the comments you made around undersupply in North America until at least 2030. I was wondering if those two factors at all made you consider adjusting the scope of your Canadian investment in terms of capacity, and at what stage? Or would you also consider thinking about, sort of adding battery recycling in North America as well to kind of create a regional closed loop? On the second question, just in, you know, referring to HLM and the developments that you've made there. Can you just remind us in terms of timeframe from sort of where we are today towards commercialization and how, you know, that's sort of shaping up in terms of potential discussions with customers? Thank you. Yeah. Thank you. Thank you very much. First question, IRA impact. Of course, and I shared this before, the moment this IRA bill was clear and was decided, we received a lot of traction with our customers that had to, today is of future potential customers that had to redo their supply chains for North America because the current set-up didn't work. We see currently also with some discussions that are in the news between the US car manufacturer and the Chinese battery maker, how difficult it is to make that happen. Now we, of course, are seeing that increased traction. There are two things that we have, which we always keep in mind. The first thing is any type of further investment needs to be value creative and needs to have, you know. We set quite some standards in the contract that we have done together with Volkswagen. It's for both partners, a very good contract, and this is something a little bit as the benchmark that we see going forward. We will always make sure that we have the value creative returns, and this sometimes takes some time to discuss. The second thing is that we always when we make commitments, we want to be 100% sure that we can operationally deliver, because that's maybe you can call it prudent or you can call it conservative, but I said it before, I think in this market, the ones who have the biggest announcements are not the ones that will make the business later, but it will be the ones that have plants up and running at the quality that is needed. That's what we are focusing on. I would say at this point in time, it's too early to say that we would expand anything. We are always open for discussions. We have our plan. Our plan is well on track, and for the moment we're concentrating on that. As we said, we are always open to provide more value creative investment opportunities, if they are there. At the time being, we stick to our plan. Battery recycling could be, and it's always, you know, already in our more mid to long-term plan for North America included. Also here we want to concentrate first on Europe to implement what we have said. Also we, you know, the next step after Europe for sure would then be North America, but it's not yet concretely planned. HLM, it's a very good topic because HLM fits to what has been asked earlier. It has just moved into the industrialization phase because we have been able to solve two key issues, which is the stability of the material and the conductivity, which is complicated if you have a very high manganese-rich environment. We have developed a proprietary coating and doping technology that solves that. Now we have moved with actually it's 5 different programs immediately moved into the next stage. These are programs with OEMs and cell makers in all of the 3 world regions. Really, you know, interest from everywhere in the world. The timeframe of that, as we said, would be to be expect to hit our plants in 2026? Why does it take so long? If you say it's industrialized, yeah, it's industrialized, it's ready to be, you know, produced in the plants. It's still, you know, there's always a long qualification process. It's in our business. There is a second thing that is more on the OEM side and the battery cell maker side, is the adaptation of what's called a battery management system. Because this is a new battery chemistry, it's now stable and it's now, you know, can be tested. The current battery management system developed for NMC, the algorithms that are used for LFP, you need a third one, right? Because it's a different setup. With that, we are in very close contact with our customers, you know, to provide samples and to help them to actually develop this battery management system to harvest the big advantages that we see. Like, we see a 10% cost advantage of HLM versus LFP based on non-Chinese production. So, for example, a production in the U.S. At a 25. so measured in euro per kilowatt hour or dollar per kilowatt hour. A 25% better energy density than LFP, alongside with the other elements of, you know, recyclability, capability to produce in the existing NMC factories, et cetera. That's really a breakthrough for us that we are trying to accelerate as much as possible. We need our customers to be also ready to digest it from their operating system point of view. Sounds great. If I could just squeeze in a quick follow-up one on HLM. You mentioned you would use existing facilities. Is it fair to say that whatever sort of CapEx or investment requirement, you know, is factored into your midterm CapEx guidance? Yes, indeed. We have in our plan, we have that we have provided, we had said that HLM is part of that. It's not that HLM does require no CapEx, no additional CapEx compared to an NMC factory, but it's more like adding certain steps on coating and doping. It's not only in the CAM, but also on the PCAM phase. With that, it's included in our current plan, indeed. Thanks so much. Thank you. Now we're moving on to a question from Riya Kotecha of Bank of America Merrill Lynch. Please go ahead. Hi. Good morning. Thanks for taking my questions. I have a couple of ones. My first one is on closing the gap with peers. You've performed well in the legacy business of autocatalysts, but what are maybe the signs and data points you're tracking with regards to market share that makes you think you're increasingly closing. Sorry, Riya. Riya, sorry, we can hardly understand you. Can you come closer to the microphone, maybe? Yeah, sure. Is this better now? Yes, let's give it a try. My first question was on closing the gap with peers. You performed well in your legacy Autocats business, but what are signs or data points that you're tracking with regards to market share in particular, that make you think you're closer to closing this gap, particularly when you maybe expect sort of subdued RBM volumes into 2023, while some NMC peers are expecting to grow 30%-40% into this year? Let me repeat if I understood the question, correctly. It was the question how to close the gap versus our peers, right? While you said that LFP, you know, capacity or market growth is pretty strong, while we have not that growth. That's your question? Yeah. That NMC peers expecting to grow volumes 30%-40% into 2023, whereas you'll have sort of subdued volumes. Does that make it harder to then capture- Yeah. Yeah, yeah. The market share Okay. Very clear. Yeah. Yes. Very, clearly understood. I think that we are very confident that the assumptions that we have made will play out for us, because as you know, right, we have kind of been very successful with new contracts in the last eighteen months, I would like to say, and that's what we will have going on from now. The big differentiation that we have with our competitors in terms of speed is capacity. Today, you know, the ability to use capacities that you have in Asia to cater the North American and the European market is there, undoubtedly. That's the current business model, and that's why those competitors can do that. When we take the next steps and when the IRA kicks in, and when we have the respective regulations in Europe, kicking in also on the CO2 especially, what counts is that you have capacities in those regions. Today we are the only ones that have capacity in Europe, and we are not the first ones, but in the very first group of players to play in the North American field. With that, we see a strong acceleration possible for us, when our new programs hit the factory. Actually it's a time advantage that is based on regional differentiation of the different markets. Okay. Can you maybe talk about your stage of contracting, with customers in North America? Externally, it seems as if peers are announcing contracts at a faster pace. Just wanna understand this. Is this because you're trying to negotiate tighter contract structures? Right. similar to the Volkswagen JV or they're more competitive? Related to that, is there one more contract to be announced? Is my understanding. Is that correct? Yeah, so first of all, to answer. In North America, we apply the same principles we have applied in Europe, we have applied with the Volkswagen joint venture. We take enough time to create value creative contracts. There's a strong demand to work with us. You have seen maybe that we have already signed an MOU again with Volkswagen also to expand that. That, you know, it's not yet decided whether this will be part of the joint venture or will be a separate initiative. You can rest assured that the same, you know, principles will apply in terms of value creation. Now, on top of that, there are, you know, other very active and very advanced discussions for North American entry. At this stage, it's even more demand than we have planned to put in capacity. We are, you know, in a good situation to negotiate in the right way, if you know what I mean. Yes, I can also confirm that we are very confident to have at least one more announcement in the first half of this year on a major customer contract. With that, I can just repeat what we said. We feel very confident on this ramp up that we have already proclaimed one year ago for end of 2023, beginning of 2024. Okay, thanks very much. Thank you. As we're nearing the end of the call, we will take a few more questions from people in the queue, but we kindly ask to please limit to one question per person. Thank you. With that, we are moving on to Jean-Baptiste Rolland of Credit Suisse. Please go ahead. Hi, good morning, and thank you for taking my question. I would just would like to ask about what difference it makes for your battery materials business, for the differential that you see between the US IRA and the European Green Industrial Plan. My sense is that it, you know, it makes more. It is more important to have a local value chain in the US than in Europe. I would like to understand whether that is basically a valid perception or not. The reason why I'm asking is because it's not clear from the European regulation that there is a push for having the full value chain within Europe, i.e., the local. There are plants for batteries, there are plants for EVs, that's clear. It is not clear that actually the materials have or will also have to be produced in Europe. Whereas in North America, there are signs that suggest that the full value chain, including materials, will have to be local. I would just like to understand what's your take on it, whether it's a misperception or anything you can comment on. Thank you. Yeah. No, it's not a misperception. That's basically because the plans on the European Union have not been fully finalized. It's very clear that in the U.S., through the IRA, there is, we know what will, what will... If it really, it turns out like it is said today, it will be a closed shop, right? It will be a local for local market that is clearly incentivized by the tax credits for the cars at the end of the day, that at the end of the value chain. In Europe, this has not been so clearly outspoken yet. For Europe, we see from the beginning, and that was why Umicore had invested. We saw another strong driver that has the same effect, which is the customer voice. What is there in Europe and will be is expected in the future is that CO2 becomes a cost, and that the Scope 3 of an electric vehicle is pretty bad today. You know, the CO2 emissions producing a battery is the biggest contributor to the Scope 3 footprint of a car. Some of the OEMs in Europe have already, when they're sending out their RFQs for battery materials, you have to commit to a certain CO2 level that you are dealing with. With that, being not in the region with a fully integrated supply chain, you will have no chance to meet that target. I can clearly speak because it's open and public. BMW, for example, has it's an in and out requirement. Either you do it or not, others have that as well. We know with our work on Volkswagen that they're also very much sensitive on CO2. I think the consequence is the same. The root cause is a different one. In IRA, it's more a carrot approach, so you get money if you're there. In the EU, it's more a stick approach. If you're not there, you will have additional cost because your CO2 equation doesn't pay out. Then we will see how, you know, the subsidy scheme is looking like. There is also, you know, the last word has not been spoken. From a strength point of view, currently, I see both arguments, similarly strong from a different angle of reasoning. Thank you very much. Thank you. We have come to our last question, which comes from Ranulf Orr of Citi. Please go ahead. Great. Thank you for taking the questions. Firstly, please could you just clarify the RBM outlook for 2023? You know, I think you said it'll be, you know, earnings will be in line with 2022, but what earnings are you talking about, you know, given the shift from... Are we talking EBIT, EBITDA? Can you give a kind of a guide on volume growth relative to the overall NMC demand numbers for next year, in line, well below perhaps? Secondly, if I could just squeeze in. On HLM, could you clarify, you know, if or how you're able to protect your recent developments in the coatings and the dopants? I mean, is this something we expect peers to follow very quickly, or is this really a differentiator for you? Thank you very much. Yeah, thank you. The earnings on also the development on the E&ST side, we traditionally never disclose the concrete numbers below the level of the business groups, and we will also not change this going forward. I can provide you so much of a guidance that when we say performance, then it's meant the EBIT-EBITDA equation of the business group. Of the business unit in this case, is expected to be in similar territory than it was in 2022. With the effects that we have described in other parts of the questions, let's say next level, the difference on the E&ST business group is that the Cobalt & Specialty Materials, they have, you know, better performance in H1 than in H2 in 2022 because of the price environment of cobalt and the end market demands. This, on a full-year effect for 2023 will somewhat reduce the EBITDA of the whole business group. This is the math again on E&ST. For HLM, indeed, this specific, I mean, HLM per se is not a new technology. It's, it's well there in the market. Those two points that we have now here, the breakthrough to basically make it from a lab thing into an industrialized product, we have protected this also with patents that we have put in place and of course with the usual trade secrets that we put around it. We are confident that we have something that is representing a considerable competitive advantage versus our peers. Okay, great. Thank you very much. Thank you. That concludes today's question and answer session. I would now like to hand the call back over to Mathias Miedreich for any additional or closing remarks. Thank you very much. Thank you very much again for the very well-educated and deep questions. I really appreciated the discussion. Thanks for listening to us, and I wish all of you a very good continued day and hope to meet you soon again in person, maybe in the next days when we're doing our roadshow. Thank you very much and take care. Thank you. That concludes today's call, and you may now disconnect.