Ladies and gentlemen, welcome to the DKSH half- year results 2023 conference call and live webcast. I am Sandra, the call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing Star and one on your telephone. For operator assistance, please press Star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Mr. Till Leisner, Head of Media Relations and Investor Relations. Please go ahead, sir. Thank you, Sandra, and good morning, everyone. It's a pleasure to welcome you on behalf of DKSH. As you have heard, my name is Till. I'm Head of Investor Relations, and I'm very happy to have with me today our CFO, Ido Wallach, and our CEO, Stefan Butz. Before we start, please, as usual, have a look at the disclaimer of the presentation regarding forward-looking statements. For those who do not have the presentation in front of them, you will find them on the webpage under investor relations at dksh.com. With that short introduction, I'd like to hand over to Stefan. Thank you very much. Good morning. Welcome everyone to the presentation of our half-year results 2023. Thank you for joining us today as we dive into the highlights and progress our company has achieved during the first half of this year. I'm joined today here by our CFO, Ido Wallach, and our Investor and Media Relations team. Looking at today's agenda, I will start with the highlights of the first half of 2023, including a short strategy recap and an explanation of how we continue to create value for our stakeholders. Following that, I will go into the details about the progress we have seen in our four business units. Ido will then provide the financial update. Finally, I will give an outlook, including our prospects for 2023 and beyond. Now, let's look at the highlights of the first half of 2023. Our clearly defined strategy for growth is firmly in place and focuses on five areas. First, we drive our focused business unit strategies to generate long-term value and accelerate our M&A strategy to expand our geographic footprint. Second, we invest in people and nurture a high-performance culture of empowerment to not only find, but also develop and retain the best talents and create a better work environment. Third, we champion digitalization by continuously accelerating digital solutions, driving our e-commerce business, and leveraging data and analytics. Fourth, we drive operational excellence by optimizing our processes and by upgrading our operations to have modern and automated facilities that increase overall agility and efficiency. Lastly, we focus on sustainability, where we take environmental, social, and governance factors into account in our daily decision-making. Overall, these 5 pillars illustrate that we are driving our strategy with a clear purpose and a strong set of values. Let me now share how we have progressed in our strategic agenda in the first half of the year. Our consistent efforts led to various highlights across these areas. We have signed and expanded contracts in various markets. This includes existing and new clients such as Beiersdorf, Procter & Gamble, Lipton, Dow Chemical, Roche, Döhler, or LEO Pharma. Once again, this demonstrates that we are the preferred partner for our clients across many markets. We have strengthened our leadership team with the new Head of Business Unit Consumer Goods, Chris Ritchie, who will start his mandate in August. Under him, the business unit will continue capitalizing on its position in Asia Pacific to drive growth and profitability. Furthermore, we achieved another increase in the employee engagement score and consolidated our digital activities under our Chief Information Officer. With the upgrade of our IT infrastructure to SAP S/4HANA some months ago, we are continuing to harness the benefits of digitalization. Even in the times of this upgrade, we are proud to say that we are well advanced with the SAP integration of our last year mergers and acquisitions. With the opening of the new distribution center in Taiwan and Laos, we continue to drive our operational excellence. The center in Taiwan is the largest of its kind and the first fully automated distribution center in the country in Healthcare. The new facilities push forward automation, making milestones for both DKSH and the Asian healthcare industry. Another highlight was the opening of a sizable, fully fitted demonstration lab and calibration center by DKSH Technology Business Unit in Thailand, making the market a major research and development center in the region. We are joining forces with the centralization of various global functions in Kuala Lumpur in Malaysia. We have taken further steps in the area of sustainability. With the publication of our first TCFD report as part of our sustainability report, we are demonstrating our commitment to the fight against climate change. We have also linked our existing CHF 315 million revolving credit facility to our sustainability goals. In the first half of 2023, we continued fulfilling our purpose of enriching people's lives in the market we operate. The successful execution of our growth strategy creates sustainable value for our stakeholders. I'm happy to say that we maintain our track record, growth, margin expansion, and strong cash conversion. With net sales of CHF 5.6 billion, corresponding to a 7.2% increase in constant currency, we achieved clearly above GDP growth. In terms of profitability, we also stand at a strong level with a core EBIT of CHF 162.7 million. This corresponds to a margin of 2.9%, and thus an increase of 15 basis points. With a free cash flow of CHF 179 million, corresponding to a cash conversion of almost 170%, we again surpassed our long-term goal of 90% cash conversion. The high cash efficiency gives us the opportunity to continue pursuing our progressive dividend policy and a targeted M&A approach. Let me now go into more detail exactly this capital allocation over the last few years, where we have expanded our overall profitability through active portfolio management. We have closed over 20 acquisitions since 2019. We look at them in detail, we can clearly see that the allocated capital has flowed into higher margin business units and business lines. To be more precise, we allocated around 90% of our invested capital into business with above-average margins. Two brand acquisitions in the last 18 months from Eisai and Noru strengthened our position in the highly attractive Healthcare own brands business. This enables us to further enlarge and professionalize our already existing structures. Here, we consistently generate double-digit EBIT margins. Most of the allocated funds went into Performance Materials with 10 acquisitions in total. We consistently enlarged our footprint in Asia Pacific, in Europe, and with our largest acquisition of Terra Firma, also in North America. We executed our strategy to build business Performance Materials into a global player. In Technology, we are expanding our market leadership in the field of scientific instrumentation. We have also strengthened our Semiconductor business with the acquisition of DNIV. In the first half of the year, the focus was on integrating the 10 companies that we had acquired last year. At the same time, we continued due diligence discussions across various projects. Looking ahead to the second half of the year, we are very optimistic that the M&A activities are picking up again, and our strong balance sheet provides room for expansion. Let me now continue briefly with an update on our business units, starting with Healthcare. Our biggest business unit has again significantly contributed to our results, driven by the expansion with existing and new clients in Thailand, Malaysia, and Vietnam, as well as a successful market entry in the Philippines. Net sales reached CHF 2.8 billion, an increase of 6.7% at constant exchange rate. By successfully integrating M&A and expanding our own brands business, we delivered on the premise of focusing on higher value-added segments and services. As a consequence, core EBIT margin further increased after an already strong H1 2022 from 2.6%- 2.8%. Let us now turn our attention to our business unit Consumer Goods, where we recorded further core EBIT growth. With multiple client wins, such as the ones mentioned earlier, and the portfolio optimizing coming to an end, we are in an early stage of a shift into growth acceleration. Consequentially, the Core EBIT margin further increased from 2.1%- 2.2%. With the new business head, unit head, Chris Ritchie, we will continue to capitalize on our leading position in Asia Pacific. Moving on to business unit Performance Materials, where we aim to strengthen our leading position in the specialty Chemical and Ingredients Distribution business. We recorded double-digit net sales growth in constant currency, which was driven by M&A. The slightly lower organic sales must be viewed against the challenging macroeconomic environment, destocking and strong performance in the last year, driven by high industry demand in Asia Pacific and Europe. The Core EBIT was CHF 62.3 million. It is worth noting that this includes the amortization cost of CHF 4.9 million, which were mainly M&A related. With the Core EBITA of CHF 67.2 million, that means before these amortizations, we managed to deliver a stable margin of 8.8%, almost at par with last year's level, despite our challenging macroeconomic environment. We saw a sequential improvement in the second quarter compared to the first and year-on-year growth. Combined with cost efficiency measures and market consolidation potential, this makes us slightly more optimistic for the second half of the year. Ending our business unit deep dive with Technology, I'm pleased to say that we recorded double-digit net sales growth and continue to see very positive overall development. Increased investment in scientific instrumentation, precision machinery, and semiconductor industry in Asia allowed us to build further resilience and deliver significant growth. It is pleasing that we also see very good integration of the acquisitions of last year, which led to a good performance above expectations. With a Core EBIT margin of 4.7%, the Technology business unit made a strong contribution to the overall performance. I would like to highlight the diligent execution of the strategy by focusing core business lines and expanding on consumables and service portfolio. Looking ahead, the aim is to consolidate our position in key industries in Asia Pacific, to build further resilience and to focus on higher margin segments and services. Thank you very much for your attention. With that, I hand over to our CFO, Ido, who will talk you through the financial numbers in more details. Ido, please. Thank you, Stefan. Welcome also from my side. I'm very pleased to provide you with further details of our 2023 first half results. To provide you with the utmost comparability of our operating performance, we focus on results reported at constant exchange rates. This also helps to better assess the competitiveness of the business units in their respective local markets. We are pleased with the achievements made in the last six months, which are reflected in our key financials. Net sales grew by 7.2% at constant exchange rates. Core EBIT has increased by more than double the rate of net sales increase at 15.5% in constant exchange rates. As a reminder, Core EBIT excludes IFRS-driven movements related to joint ventures and associates in which DKSH owns less than 50% and which are not consolidated within any one of our four BUs. Core EBIT margin rose by 15 basis points to 2.9%. This marks the fourth consecutive year of EBIT growth and EBIT margin expansion in half one. Core profit after tax in half year 2023 stood 9.3% higher than in half year 2022 at constant exchange rates. We generated CHF 179 million of free cash flow, representing a cash conversion rate of 168%, comfortably exceeding our long-term target of 90%. Let me now cover our net sales development in more detail. In the first half of 2023, we grew organically by 4.3%, an important achievement which meets our ambition to outgrow the weighted GDP growth in our markets. The Asian Development Bank currently forecasts GDP to grow by 3.7% in 2023. We therefore confirm our long-term GDP plus objective. The objective that describes our ambition to grow faster than economical in the markets where we operate. We do this by winning market share for existing clients, by winning new clients, and by expanding into new channels and new geographies. Once again, M&A has been an important growth component, contributing as much as 2.9% following the consolidation of deals closed in 2022. Combining organic and M&A, our net sales growth at constant exchange rates was 7.2%. The reported numbers have been adversely affected by the negative 6.7%, following the strengthening of the Swiss franc in the period. For perspective, our two most relevant currencies, the Thai baht and the Malaysian ringgit, reached their all-time low versus the Swiss franc during the first half one period. Moving now to the development of our Core EBIT. We are very pleased with our Core EBIT growth rate of 15.5% at constant exchange rates. The result is once again, evidences the strength of our rich portfolio. Sales growth, combined with very intentional focus on gross margin and cost structure optimization, deliver an overall Core EBIT margin improvement of 15 basis points. M&A added 10.2% to Core EBIT growth. This is proportionally larger than its 2.9% net sales contribution and hence margin accretive. As mentioned by Stefan, we follow a very clear capital allocation strategy, and the current M&A pipeline is very healthy. Similarly to net sales, FX also had a negative impact on our Core EBIT, measuring negative 9.4%. A few words to provide more context to the role of FX in our results. Our cost structure is predominantly local and hedged when it is not. As such, we have very limited FX exposure in each market where we operate. However, when our P&L is translated into Swiss francs for reporting and consolidation purposes, it naturally moves with the FX rates. Core EBIT reached CHF 162.6 million, setting a new all-time high for the first half after doing just that in the first half last year. Just to underline again the difference between Core EBIT and EBIT. Core EBIT excludes the share of results in associates which are less than 50% owned by DKSH, and fair value adjustments related to employee shared base compensation in joint ventures that are not part of our operating business. Accordingly, reported EBIT was CHF 158.5 million. Let us now move on to review cash generation in the period, a strategic area where we continue to make very meaningful achievements. As you are all familiar by now, an important part of our strategy is our asset-light business model. We typically lease our offices, our distribution centers, and our transportation fleets. In recent years, consistent with industry norms, even software and IT equipment are also increasingly leased or outsourced. As a result, our capital expenditure in the first six months of the year remained at a low level of 0.4% of net sales, equivalent to CHF 21.3 million. For the remainder of 2023, we expect CapEx to remain stable at 0.5% of net sales. Free cash flow in the first half of 2023 was CHF 179 million, compared to CHF 72.1 million in the same period last year. The strong increase was driven in particular by continuous improvement in receivables management, which I will touch upon momentarily. Steady in the last 3 fiscal years of growing free cash flow well ahead of profit, cash conversion reached 168% of Core profit after tax, significantly is above our long-term target of 90%. Let us now take a step back and look at the strong half results, also in the perspective of our overall strong and sequential long-term performance. As you can see, over the past 4 years, we achieved continuous growth despite strong headwinds from currency effects and from the pandemic. At constant currency rates, our revenues have grown at a compounded average annual rate of 3.8% and Core EBIT at a rate of 15.8%. At the same time, we deliver increasingly sound free cash flow generation. Let us now move on to our balance sheet. I would like to highlight four things. First, we maintain a very strong liquidity position. Our net cash position at the end of the first half was marginally negative at CHF 20.7 million and +CHF 21.6 million better than December 22, 2022. This despite the increased dividend of CHF 139.6 million paid out to shareholders earlier in the year. Working capital, defined as trade receivables plus inventory minus trade payables, is at CHF 899.7 million. It is 6.7% lower than last year, despite the underlying higher sales. Measured by days of sales, working capital is now at 29 days, compared to 31 days last year. The key driver of this working capital improvement is accelerated collection, which can be seen in the reduction of trade receivables to historical lows. Measured by days of sales, receivables are at 60 days, compared to 64 days this time last year. This is a result of the relentless focus of our business teams, our unique customer credit profiling capabilities, and a number of proprietary IT tools and automations that we developed over the past few years that allow us to manage receivables very effectively. As you all know and have come to expect from us by now, our effective receivables management is mirrored by equally tight inventory management. Finally, our equity ratio of 30.1% provides us with ample room for leverage. We continue to carefully assess deals and only acquire if we find them value accretive, scalable, and available for a reasonable price. Before we attend to Stefan to elaborate on our prospects, let me provide you with some financial indications. In terms of M&A, we estimate that our recent acquisitions will contribute around 2.5%-3% to net sales. On the FX side, assuming that current rates prevail for the remainder of the year, we expect a full-year FX impact of around -6% to -7%. Tax rates, we estimate it to remain within the midterm range of 27%-29%. Capital expenditure is expected to remain at 0.5% of net sales for the full year. With that, I would like to thank you for your attention today and hand over back to Stefan. Thank you, Ido, for the details of our financial. Let's now focus on the outlook. First, let's take a look on the current macroeconomic landscape in Asia. Current predictions still point to an Asian economic growth ahead of the world GDP. The economic recovery in the region is expected to continue with high growth in Southeast Asia, driven by a return of tourism and robust domestic demand. As we move forward, we anticipate inflation to gradually moderate, bringing us closer to pre-pandemic levels. Coming to our prospects for 2023 and beyond, let me emphasize that we are fully committed to delivering GDP plus sales growth. With our strong presence and deep understanding of the Asian markets, we are well positioned to capitalize on the region's economic growth and consumer demand. Additionally, we expect to achieve Core EBIT growth in 2023. Furthermore, we see good potential for further M&A consolidation. As we continue to expand our footprint and strengthen our market position, we actively explore opportunities for strategic partnerships and acquisitions that will enhance our capabilities and unlock new avenues for growth. With that, I thank you all for your attention and invite you now to address your questions in our Q&A session. Thank you very much. We will now begin the question- and- answer session. Anyone who wishes to ask a question or make a comment, may press Star and one on the touchtone telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press Star and two. Participants are requested to use only hands for asking a question. Anyone with a question may press Star and one at this time. The first question comes from Gian Marco Werro from ZKB. Please go ahead. Good day, everyone. Three questions from my side, please. The first one is on your Technologies business. That one seems to really boom. What are the products that are currently driving the growth there the most? What are your next steps from a strategic point of view to further develop this business? Maybe geographical expansion or even more M&A there. The second question is the right of use assets. I was positively surprised that they are down by around 9%, also bringing down your operating costs. Can you maybe elaborate there about the development, how you could manage this? The third question is also on a cost question. On your operating costs in general, they also decreased 3% despite the growth that you had and also M&A. Can you maybe elaborate how you keep it on such a low level, and then maybe also how you expect personal costs to develop within DKSH? Thank you. Thank you very much, Gian Marco. Let me take the first question on Technology, and then I will hand over to Ido for the, you know, to detail financial question. On Technology, you know, as you know, a few years, we defined a very focused growth strategy, concentrating on precision machinery, scientific instrumentation, and then most recently, we also added the Semiconductor business on top of that. We currently see some very good growth across all those three focus areas, you know, driven by very good, investments, especially coming from, China, but there's growth across, you know, all markets. We also have a very, you know, healthy M&A pipeline there. You can expect that in the second half of the year, we most likely, if things are running well, we will be able to share some, you know, good news with you. The third driver is that around selling machines in those focused areas, we put significantly more effort in delivering also spare parts and services around those machineries. Especially since all borders and all companies are running after, you know, the setbacks we had during COVID, you know, also the service sector is running very well. I think you can expect some very good development in Technology over the years moving forward, supported by some good M&A. Good morning, Gian Marco. Happy to take your questions on the cost structure in general. You touch upon the right of use of assets. It's down 7%. Please remember that there is an important FX impact in this reduction. As I mentioned before in my speech, our cost structure is also benefiting when exchange rates are going against our P&L. It's 7% down and 8% down in constant exchange rates. You have a net decrease of 1%, and that is mainly got to do with the composition, the length of our leases and some optimization of our distribution center footprint that we have done across the region. We have actually done a few sites that we realize are not efficient to operate. Same thing on the other OpEx. There's a certain decrease related to FX, as the costs are in local currencies. Overall, as a percent of net sales, we are down 20 basis points, which is probably about CHF 11 million of net savings on a like-for-like basis. You see there, as I mentioned before, we are very, very intentional on cost structure. We have optimized some of our DCs. We have negotiated new logistic terms, and we have also made significant improvement to other costs that are flowing into this line. Tech has remained flat, 7% of net sales. This is how I take out the effect of FX. This is quite an achievement for us. We continue to invest in people, as this is basically the core of our business, relationships and market knowledge. However, we managed to contain it at the same percent of sales despite inflationary pressure on wages, et cetera. You can see some optimizations of headcounts overall and the right investment in the tech that counts for our business. Okay. Thank you. Thank you, Stefan and Ido. Thanks, Gian Marco. The next question comes from Pascal Boll from Stifel. Please go ahead. Yes, good morning, everyone. My first question would be on Performance Materials. You seem to be or become more optimistic, Q2 versus Q1. I would like to know on what grounds that is based, because, I mean, when we look at the general chemicals market, we see clearly a deteriorating, I think, environment. Do you see here something different, and on what is it based? Are you more exposed to more beneficial sectors, or something else? My second question in Performance Materials, can you give us some more details on the proportion of volume and price impact in H1? Maybe the same for Consumer Goods, that would be very helpful. I mean, organic growth was +2%, I guess the pricing more than overcompensated a negative volume impact. Yeah, that would be great. Thank you. Okay. Thank you. Thank you very much, Pascal. In Performance Materials, I mean, yes, you are absolutely right. The macroeconomic environment in the chemical industry is anything else but good. If we look into, you know, our business, where, as you know, 2/3 of the business is in Asia, we clearly saw, first of all, a trend that the, you know, destocking is significantly slowing down or almost digested. Customers are ordering again, also on smaller levels, so there is still a volume, a challenge in the market. Secondly, the challenge on the industrial side is significantly bigger than on the life science side. In our business, we have 2/3 life science, one industrial, and that is going to help us, you know, to deliver, you know, what we, what we delivered in H1. You are right, yes, in Q2, the environment was slightly better on our Asian side than in Q1. We also started to run an efficiency, you know, program, where in Q2, you know, positive support was starting to run in, whereas the, you know, majority of the effects are probably not going to materialize before Q4. For the second, you know, half of the year, you know, we are cautiously optimistic from what we are seeing in Asia, despite the headlines, I think we are, we are all reading. Regarding volume and price, in Performance Materials, I mean, it's all volume, it's all volume driven. In Consumer Goods, you know, we passed on the pricing, you know, from the clients, which is probably an uplift around circa 4%, the volume was working against us between 2% and 3%. I'm sure you have also seen that, you know, Procter & Gamble and PepsiCo and so on and so forth, they also had, you know, declining volume. It's a challenging environment for consumers also in Asia at this point of time. Thank you, Pascal. The next question comes from Nicole Manion, from UBS. Please go ahead. Morning, everyone. Thank you for taking my questions. Just a follow-up one on Performance Materials. Could you maybe talk a little bit in more detail about the performance of the acquisition of Terra Firma? Because I know that's obviously in a segment that's slowed significantly since you acquired it. It's in the U.S., and it's an industrial asset. Maybe if you could split out some of the trends in that business compared to your sort of other, sort of standalone business. Secondly, on consumer, you know, I think you mentioned in the presentation that the portfolio optimization is in its final stages. Could you give a kind of an update there on what the new business head is sort of thinking? Is that something we should expect to be essentially complete by the end of, you know, the current year, and from then on, it becomes more about pursuing those, you know, new client wins and expansion? Thank you. Yeah, thank you very much, Nicole, for your questions. On Performance Materials, yes, you're right. I mean, Terra Firma is, you know, it's in North America. It's clearly in the industrial space. It's faced with a, you know, very challenging environment in the, you know, in the US. What we currently see there, first of all, is the integration is, you know, is running very well. We have the Canadian business already fully on SAP, and the team is, you know, doing some very good work in integrating, and all the functions, et cetera. The Canadian market actually is standing out a little bit and is looking quite, you know, quite positive. On the rest of the business in the U.S., we see, you know, first synergies coming in from, you know, our clients and customers, which is giving us, in this challenging environment, you know, a little bit of tailwind. Overall, the situation at this point of time is definitely not what we were hoping for, but we are very optimistic that in the medium run, you know, we would benefit from this acquisition and, you know, we are going to enjoy a lot of, you know, joint, you know, success. On Consumer Goods, I mean, over, you know, the last four years, the transformation of Consumer Goods, you know, doubled the profitability and doubled also the margin of this business. You know, the leadership team overall has done a very good job in setting up the business for some, you know, good future growth and increasing also the confidence, you know, of our clients and customers. After this period now of, you know, building a better business, we are running now into the phase of building a bigger and a better business. If I look currently into our BD pipeline, I mean, you have seen a few of the most recent announcements. There are a few more in the pipeline, so we are very optimistic that some solid groundwork was already left in, laid out to deliver, you know, further growth as comparing to what we have seen currently. On top of that, if you look at the background of, you know, Chris Ritchie, who is, you know, very strong on the BD side, I am convinced, or we are convinced, that we can further accelerate it. You know, let's, you know, let's make sure that he can get his feet on the ground first. You know, he's starting, you know, mid-August, then we are happy to report, you know, more details. We are also optimistic that, you know, with the current GDP outlook, that the overall environment and inflation coming down, is also giving us a little bit better environment there for the near-term future. Thank you. Very clear. Thank you, Nicole. The next question comes from Andy Grobler from BNP Paribas. Please go ahead. Hi, good morning. Just two from me, if I may. You talked about the success of own brands within the Healthcare business unit. Can you just talk to the kind of the scope of opportunity from that initiative, and kind of within that, where you are now as kind of own brands as a percentage of sales, and where you think you could get to over a period of time? Then secondly, just on free cash flow, clearly very strong performance in H1. Are you at the end of that opportunity set, or is there more to do over the next 2 to 3 years? Actually, just if I could add one more on consumer, just to follow up from the previous question and clarify: Is that process of optimization now complete? Should we see improvements in organic on all else being equal, into the second half of the year? I know Chris has yet to arrive, and there may be some strategic changes, but just in terms of what's currently in the plan, if you could help us there, that would be super helpful. Thank you. Okay. Thank you very much, Andy, for your questions. Let me answer on Healthcare and own brands. Then I hand over to, you know, Ido, you know, for the other, for the other two. The, you know, own brands business is really a very attractive, you know, segment in our portfolio because, you know, first of all, in this case, we really own the brand. It gives us a completely different margin profile. The decisions about, you know, where to launch, how to launch, and with what A&P we support the launch, I mean, is completely on us. We are right now, you know, much more aggressive in terms of rolling out those own brands we have historically in our portfolio, but also, as mentioned in my speech, Eisai, which we just acquired last year, as well as Noru. Yeah, which just came into the portfolio, you know, in 2022. On top of that, I mean, there are always opportunities, even they are very limited, where, you know, some of the, you know, large multinationals are selling those own brands out of their tail end in their portfolio. The challenge for us there is sometimes that, you know, those processes are running global and not for Asia Pacific, but we have seen it last year with Eisai, that sometimes there are some real, you know, real diamonds available within our portfolio. We are very optimistic and confident that while today, you know, own brands are still, you know, somewhere around 3%, in our overall portfolio in terms of sales, profitability or EBIT contribution is significantly higher, that consistently over the years to come, you know, we can expand it through, you know, further penetration of existing markets rolling out across our portfolio, as well as, you know, some additional M&A. Yeah, I'm happy, Andy, to answer your questions on, on cash flow and reiterate the direction on Consumer Goods. As I mentioned before, we maintain our long-term guidance of cash conversions is 90% of PAT. In this, in this half year, we performed exceptionally better versus this. And I think that 60 days of receivables is probably where we're gonna stay long- term. Not far below that, because this is also the credit terms we give to our customers. Inventory is a fairly optimal state. About 51 days, about 7 weeks, was also there December 2022, so I expect it to be there. So more or less the guidance of 90%, as as PAT remains. On Consumer Goods, I think it was also mentioned by Stefan. We're really shifting now from a strategy of better before bigger, a strategy that brought us to double the marginality of this business, currently at 2.2, 10 basis points ahead of last year. We finished last year, the full- year, at 2.3%. Expect also to make similar progress this year and really shifting from better before bigger to better and bigger. Far in the half one, +2%, that's the early signs. We are looking to accelerate that into the future. Again, let's let Chris hit the ground in August and gradually build the infrastructure and bring in the business development to deliver those accelerated growth. Okay, thank you very much. The next question comes from Stephanie Schulz-Nic from Mirabaud. Please go ahead. Yes, good morning, everyone. I have a couple of questions in mind. An add-on also on that portfolio optimization in Consumer Goods. Can you quantify a bit how much in the first half was coming from the SKUs you faded out? If I understood you right, that's coming now to an end. Does this mean that the EBIT margin we are seeing right now is somewhere the limit, or would you expect it to grow further? Can you maybe in terms of a breakdown in segments in the Consumer Goods, can you elaborate a bit how the Luxury segments or Lifestyle and Luxury segment performed? What was EBIT contribution from Maurice Lacroix, if you share that information with us? in Performance Materials, you were saying that you it took, or you wrote in your presentation, that you take some measurements in terms of efficiency. What exactly are those measurements? Sorry, fourth one, if I may. On Thailand, there were elections in May, with the Move Forward Party winning a lot of seats, does this change anything in you doing business in Thailand or the whole environment? Okay. Thank you. Thank you very much, Stephanie. Then let me, you know, run you quickly, you know, through those questions, and then later on, Ido, you know, can please chip in if I forget anything. Yeah. First of all, in terms of the portfolio optimization, that was probably, you know, close to a 1% drag in H1. That is what you have to put in perspective here when you see that net sales grew at, you know, at 2% at constant exchange rate. In terms of the margin, yes, as I was saying before, we are very proud that we doubled the margin over the last four years. We also have seen, again, a margin improvement in H1 this year. Be rest assured, you know, that this is not the end of it. Let us reach now, first of all, the objective which we shared with you in the past, that we achieve 2.5% margin, and then together with Chris Ritchie and his leadership team, you know, we will define then the next, the next level. In terms of the, you know, lifestyle and the Luxury business, I mean, first of all, as we discussed in the past, this is strategically, you know, not core for us. There are a lot of, you know, legacy contracts and portfolio parts in there at this point of time, with, you know, with a mid different bag of performances or mix of performances. you know, where few areas during COVID, you know, the performance was doing very well, that is where we currently see a slowdown. Again, it's strategically not core. It's not what we really focus on building, you know, medium- term. In terms of the, you know, performance or efficiency improvement program, it's first of all, I mean, streamlining, you know, our sales teams, sales performances, as well as the digitalization of sales processes and some other core processes, but it's also reducing, you know, headcount in a few areas. Maurice Lacroix, yep, continues to, you know, deliver positive cash flow and, you know, positive EBIT, you know, for the year 2023, so there is no material change. Looking at the numbers from the market, we believe they continue to build some, you know, market share. In Thailand, overall, yes, the election did happen. The results are not really executed yet at this point of time. Let's see what is going to happen there over the next few weeks or months. All what we can say is what you probably also read, that the GDP growth in H1 came in slightly better than originally forecast. I can only confirm you know, that our business in Thailand is showing that it's very resilient, and we are seeing some good growth in Thailand across all four business units. We are optimistic, you know, for the outlook of Thailand, no matter what the outcome of the election is. Ido, you want to add something on top or? Yeah, very little. I think you covered everything, Stefan. Maybe some more perspective on the SKU rationalization. In the Consumer Goods, what we have focused on the last few years is two prongs. One is actually looking at the client contracts and optimizations, deconfiguration sometimes, or working together with clients when the overall client contract was not favorable for our terms and our profitability. The work of specific SKUs within a client portfolio, for example, P&G or Mars, Incorporated, that's work that we do with the client and highlight the clients who are serving a certain SKU is not operational or partially efficient, but then it's a client that discontinues. On the other end, in PM, we are the market makers. This is where we fully control the SKUs that we buy and sell. This is as part of the efficiency plans that Stefan mentioned, is where we are now focusing on the higher selling SKUs and focusing less on those that are more experimental. This allows us, of course, to optimize the structure overall and the gross margin. Thank you, Stephanie. Who's next? The next question comes from Jon Cox from Kepler. Please go ahead. Thanks very much, guys. A few questions from me. You were talking about the Consumer business being on the sort of verge of accelerating top-line growth. I wonder if you can just sort of define that. You seem to be implying organic growth was already reaching 3%, if you exclude the SKU rationalization. You know, can that get to 4%, 5%, 6%, you know, over the next couple of periods, given the SKU rationalization you've done? That's the first question. Second question, just to come back to the cash flow. Obviously, we all understand this 90% conversion over the medium- term, but clearly this year, you're gonna be, you know, knocking that out of the park based on H1. Is free cash flow somewhere CHF 260 million-CHF 270 million this year, a reasonable assumption? I think consensus at the moment is about CHF 210 million. There's just the last one, the old chestnut on the core EBIT consensus for the year, just a shade below CHF 350 million. Are you guys comfortable with that? Thank you. Okay. Thank you. Thank you very much, Jon. Maybe I take question, you know, one and then, and three, and then, Ido is, you know, answering the cash flow question. In terms of Consumer Goods, yes, you are right. You know, we currently show 2%. If you take the portfolio rationalization on top of it, you know, you are somewhere around 3%, and this is clearly not GDP plus at this point of time, what we do across the group and in the other business units. Our objective here is also to deliver, you know, GDP plus in the near-term future. Regarding the outlook, I think we have shown, you know, consistently now over the last four years, and we are also proud on this, that we can deliver some, you know, good GDP plus growth, margin expansion, and also very strong cash flow. We also have a healthy pipeline for the second half of the year. We are, you know, very confident in terms of the of our outlook, that we can, you know, deliver EBIT growth over last year and also in H2, growth over H2 last year. We are, you know, very confident in that statement. Therewith I hand over to Ido. Yeah. Thank you for the confidence on the cash generation. I wish it were just one knockout of the park. It's a everyday hard work for us, and there's still six months to go, or a little bit more than five. It's true that we are also ahead of our own expectations and a lot of star align for us in this up here. However, we maintained the 90% guidance because remember, if we're gonna accelerate our growth, which is the direction, of course, that will consume some more working capital. We'll remain efficient in as a percent of sales or in days, but it will consume a little bit more working capital. Also, sometimes we have to be quite opportunistic if a client contract lends well just before the end of the year, requires some working capital investment. We are quite confident that we will continue to very efficiently manage cash, but we would like to maintain the 90% guidance as we have done also before. Okay. I wonder if we just have a follow-up on the Performance Materials business. The podcast, the infamous podcast from a couple of weeks ago from the CEOs of the division, they seem to be saying now the weight of the business is now more 50/50 in terms of life sciences and the industrials, with the acquisition, obviously, you did in North America last year, and also seems to be more closer to 50/50 in terms of the split between Asia and then the rest of the world. Is that a fair assessment? Because you were again talking about 2/3, you know, for both Asia and for the life sciences. Yes, thank you very much. No, Jon, I mean, clearly, you know, the split is 60% life science, 40% industrial on sales, including, you know, the acquisition in the U.S. That is what we expect for 2023 full- year. The split between the regions is 55% Asia Pacific, 30% Europe, and 15% the U.S. Again, also, that's the same split for the full- year 2023. Okay. Then, you know, given what you're saying about Asia recovering and the life science recovering, do you think Asia and life science can recover enough for you to get to a flat organic sales growth figure for the year in that business after the near 4% decline we saw in H1? Look, I mean, at this point of time, there's a huge amount of uncertainty. Again, yes, life science in Asia is a little bit better. You know, it's really hard to predict it exactly, you know, on the dot here. We are very optimistic, especially, you know, moving also into, you know, 2024, when then hopefully the worst year in most recent history is behind us. Okay. Then maybe just a final one on the profitability of that business. Clearly, you know, you do have the amortization related to M&A. I think we all understand that. Yeah. You know, your margin was a little bit lower maybe than the market anticipated, 10 bps or so for H1. You're talking about various efficiencies coming through. We know the North American business was maybe a weaker margin business anyway. You know, if you, if I look back to, say, 2021, you had a 9% margin for that business, can you get back to there in the next few years? Do you think, you know, just the way the mix of the business and things have shifted, no, that's probably too optimistic. No, I don't think so. Any, any timeline? When you were saying, when you were saying over the next years, right? That was your statement. No, I think the, Yes, exactly. you know, 9% is clearly an objective, you know, where we have to bring the business and looking at the mix we have from a regional perspective and then life science, industrial, I think that's a, that's a nice target for us jointly to have, Jon. Well, once the economy is better, there's no doubt that there will be higher margins. Okay. Then, I'm just gonna keep going. I think I'm the last question anyway, but, on the, on the Healthcare side, now, clearly, you know, buying these higher margin business is helping with the, with the mix. I know you're waiting for, you know, the new consumer guide before announcing new margin targets for that Consumer business. Your Healthcare business is there, your guy is there. Just wondering, you know, where can we expect that margin to go to? Is 3% out of the question for, you know, next year, for example? Yeah, shooting. Maybe I can take this. We're certainly shooting higher, and there is no margin in which we're going to stop. 2.8% is very, very strong, 20 basis points improvement, and we look to continue to improve that. The exact date in which we reach 3% is something which is also not known to us, but I believe we can get there in the foreseeable future. I'm going to ask a similar question, just about the Technology margin as well. That clearly is a standout business for you and totally turned around, and I was probably amongst some of the analysts saying, "You should get rid of that business," a few years ago, and we've been proven wrong. Kudos to you on that. Where can that margin go as well? Clearly that is suddenly becoming a mixed driver for you, much more important, particularly with the slowdown in the Performance Materials business. Yes. First of all, thank you very much for the recognition, Jon. You know, I appreciate it. We really believe in this business. We think we can become clearly market leader, especially in scientific instrumentation across Asia Pacific, you know, in this business, and then also strong positions in precision machinery and semiconductor, as mentioned before. Clearly, also here, I mean, our objective is to continuously, you know, enhance the margin. You know, the service part of the business is going to help us there. The business also does deliver, you know, some economies of scale. Again, you know, one step after the other, but the direction is clearly north in terms of margin. Okay, well, maybe I'll put it a different way. You did 200 basis points margin improvement in H1. You were 6.5% last year for the full- year. Should we be penciling at 8.5% for this year? I leave that to you, how you work With your, with your, with your sheets. you know. yeah, clearly, why? One step after the other. Yeah. One step after the other, you know, we always have to, you know, remain realistic, huh? There's also a lot of cost pressure right now in the, you know, in the different markets. Yeah. There's nothing- Maybe that's a little bit too optimistic. Yeah. I was gonna say, you know, in theory, if you did 200 basis points in H1, maybe there's some scale effects because you're growing 20% or whatever, plus organically, you know, you would imagine that you can certainly do a, you know, 100 basis points improvement on the H2 or something like that. You know, that's what I'm, that's what I'm trying to get to. Unless you see something and say, "No, no, don't do that," because it's the extraordinary impact of those organic sales growth and normalized, you should be, you know, 6.5%, 7%, normally. I mean, clearly, I mean, the big chunk of the business, as you know, is always coming in, you know, in Q4, point number one. Point number two, the base in H2 from last year is significantly higher than it was in, you know, Q1, Q2 this year. That's, you know, where I'm a little bit more cautious than you are. Okay. All right. Congratulations on the figures, anyway. Thank you. Thank you very much, Jon. Next question comes from Olivier Calvet from Credit Suisse. Please go ahead. Yeah, good morning, all. Thanks for taking my questions. I'll try to keep this short. A few follow-ups. On PM first. So just on the order behavior and the sequential development in Q2 versus Q1, this is pretty helpful. I just wanted to know if the improvement was in any way driven by the return of some specific customers' volumes that might have struggled, you know, last year. Yeah, that's the first one, maybe. Hi, Olivier, good to hear you, this morning. We had a sequential improvement. I think we mentioned last year in the half one, some difficulties, we had in certain places. Those have definitely been recovered, so that drives part of the growth. Okay. Okay. second one is on the sales contribution you would expect from M&A and PM over the full- year. Yes, we mentioned 2.5%-3%. We will have the full- year effect because most of the acquisitions last year took place in the second half. You have the anniversary of those M&As in the second half. Right. No, sorry, I meant specifically in PM, because, you know, the number I see for H1 is slightly lower than what I would have expected in terms of sales contribution in Swiss francs at least. I was just wondering if you could give us a sense of, you know, we have 18% M&A contribution to the year-on-year growth in PM, in H1. What's the figure you'd expect for the full- year? Well, here, of course, it really depends on the demand in the market, which has been quite soft overall. Also, many of our peers and suppliers have reported a similar direction. There's also impact of the FX there. As Stefan mentioned, we think that the worst is behind us. Whether it's gonna be strong or just solid, it's difficult to say at this stage. Okay. Finally, just on the organic sales growth decline, you know, you said -3.7% is all volume, just to confirm, prices stayed flat? Yes, it's all volume driven. Yeah. Okay. All right, cool. Thanks a lot. You're welcome. As a reminder, if you wish to register for a question, please press Star and one. The next question comes from Michael Foeth from Vontobel. Please go ahead. Yes, good morning, gentlemen. Just one question from my side. You mentioned the EBIT margin accretion from M&A in the first half, and how that drives the profitability. I was just wondering how you think about return on invested capital with those acquisitions, because that seems to be a bit dilutive in the first half, just in general. Thank you. Yeah, overall, the acquisitions are accretive because they have they're growing their EBIT, and of course, if you look at EBITA well ahead of their contribution of net sales. In terms of return on invested capital, on the short- term, there's a goodwill effect of those acquisitions. Overall, they will deliver an incremental rollout which is higher than our average. Okay, great. Thank you. Yeah. Gentlemen, so far, there are no more questions on the phone. Thank you very much for all of those questions. I think we conclude the call for today, and if there's any questions following this call, please contact the Investor Relations department, and we'll be happy to answer your questions. Thank you very much, and we all wish you a lovely day. Thank you very much for your interest. Thank you. Bye-bye. Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call. Thank you for participating in the conference. You may now disconnect your lines. Goodbye.