Ladies and gentlemen, welcome to DKSH Half Year 2026 Results Conference Call and live webcast. I am Valentina, the Chorus 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 Investor and Media Relations. Please go ahead. Thank you, Valentina, and good morning, everyone. Welcome. I'd like to extend a very warm welcome to all of our participants in the call today. I'm Till, Head of Investor Relations at DKSH, and I'm delighted to be joined today by Ido, our CFO, and Stefan, our CEO. Before we begin, the usual comment on please take a review on the disclaimer regarding forward-looking statements on today's presentation. You find the presentation on the Investor Relations webpage at dksh.com. Before we continue, I also would like to address a correction regarding the first half 2026 earnings per share calculation. Following publication, we identified and corrected an error in the earnings per share calculation. The correction has no impact on the reported financial results or on the underlying performance of the company. The correct first half 2026 earnings per share figure is CHF 1.56 per share and not CHF 1.67 as initially stated. The corrected media release and the related documentation have all been distributed and are available on the DKSH webpage. With that, I'm pleased to hand over to Stefan to get us started. Thank you very much. Hello, everyone. Welcome to the presentation of our half year results 2026. Thank you for joining us today as we review the highlights and progress our company has achieved during the past couple of months. Today's agenda foresees a short recap of our highlights of the first half of 2026. I will then continue with the progress we have seen in our four business units. After that, Ido will follow up with a financial update. To conclude, I will provide the outlook statement before we open the Q&A session. Our half year results once again demonstrate the resilience of DKSH business model and the consistent execution of our strategy amid continued global uncertainty. We again deliver a solid operating performance, strong cash flow generation, and higher earnings per share in the first half of 2026 while building the growth engines of the future. Looking at the midterm roadmap presented, we have consistently delivered across our four strategic priorities: growth, margin expansion and M&A. Our semi-annual growth rate has increased steadily, reaching an impressive 4.9% in the first half of 2026, up from 3.6% in the second half, and 2.1% in the first half of 2025. While our Core EBIT margin slightly declined in the first half of 2026, reflecting investments in business development, AI capabilities, and some FX impacts that Ido will explain in more detail later on, we remain focused and confident on our ability to deliver long-term margin expansion. We have continued to execute on our well-developed M&A pipeline, announcing 12 acquisitions since the beginning of 2025 and are very confident about the second half of the year. Through this consistent execution of our midterm roadmap, we remain committed to delivering sustainable Core EBIT growth in the years to come. As usual, I will comment on our results using constant exchange rates as this better shows the operational performance and ensures comparability to previous results. DKSH delivered a resilient performance in the first half of 2026, despite continued global uncertainty and headwinds. The result was driven by accelerated organic growth, successful business development, and the continued execution of strategic initiatives. Net sales increased by 4.9% to CHF 5.5 billion. This is the strongest first half revenue growth we have achieved in three years. In a challenging environment, Core EBIT grew 3.6% to CHF 163.4 million, resulting in a Core EBIT margin of 3%, which was impacted by unfavorable FX headwinds. Earnings per share stood at CHF 1.56, which represents an increase of 10.6%. Our free cash flow remains strong at CHF 147.7 million, with a cash conversion of over 130%. This exceeds our target for the fourth consecutive year. Alongside these results, we have increased ordinary dividend by 6.4% to CHF 2.5 per share and announced three acquisitions in higher margin areas this year. Namely, AIC Ingredients and Kinematic Resources, both in Malaysia, and Gale & Cosm in Italy. With a robust pipeline of business development, M&A opportunities, and operational excellence initiatives, we enter the second half of 2026 with expected growing momentum and confidence. Let me now focus on the highlights of the first half of the year, which underline our commercial momentum and improvements. We continue to drive our business development by enlarging our client portfolio across all business units in various markets. We recently signed our largest deal with Lilly in Hong Kong, which we expect to generate over 100 million sales contribution per year. We also entered into new material partnerships or expanding existing ones with Bayer, Pfizer, BridgeBio, Sanofi, Kemin, just to mention the ones in healthcare. Advancing operational excellence and fostering a high-performance culture remained important. With a strong employee engagement score and Great Place to Work certification in 16 markets, we continue to strengthen our position as an employer of choice. We expanded our capabilities through investments in our network, including the opening of an innovation center in Spain and the upgrade of our distribution center in Thailand. We further strengthened our AI capabilities across all business units to drive growth, enhance operational excellence, increase workforce productivity, and unlock new business opportunities. In a moment, I will share how we are already benefiting from rising demand across AI-related industries and the initiatives we are undertaking. Before doing so, I would like to emphasize that we also made good progress on our sustainability agenda. Our emission reduction targets were approved by the Science Based Targets initiative, while we rolled out ISO certifications for environmental management and occupational health and safety across 13 markets. We expanded our human rights due diligence activities. These efforts were reflected in improved sustainability ratings, included an upgraded AA rating from MSCI ESG and a gold medal from EcoVadis with an increased score. With these activities in the first half of 2026, we are well-positioned for stronger momentum in the second half of the year and especially beyond. AI seamlessly integrates with our existing processes and is becoming an integral part of our business model. It acts as an enabling factor in terms of growth, operational excellence, workforce transformation, and business opportunities. On the growth side, we will launch Polaris, our AI-driven sales force optimization and customer prioritization system. It will initially be launched in Singapore, followed by a regional rollout. This solution increases sales productivity, delivers actionable sales insights, and improves customer coverage. We continue to advance workforce transformation by scaling AI adoption across the organization. This enables our employees to focus on higher-value activities that drive innovation, customer value, and business growth while building the capabilities needed for a digital future. For example, we have implemented several AI-powered applications and agents such as Legora, which supports our legal system with research, contract review, and document drafting. This enables the team to handle greater volume of work more efficiently and focus on higher-value strategic matters. Supporting these efforts is our dedicated corporate AI team of already 16 specialists. AI also supports operational excellence. We have initiated a project to automate high-volume order management and fulfillment processes, reducing manual handling and increasing processing efficiency. This initiative is expected to generate the initial cost savings from 2026 onwards while improving scalability and, very important, service quality. Beyond improving existing processes, AI is creating new business opportunities. As part of the transformation of our technology business, we continue to expand our data center business and leverage proprietary consumer data and generate actionable insights. This enables us to broaden our client offering and develop additional high-value revenue streams. These continued investments in AI capabilities were one of the factors affecting the group Core EBIT margin within the first half of 2026. While these investments had a temporary impact, they are expected to strengthen our competitive position, unlock new growth opportunities, enhance productivity, and support the creation of sustainable long-term value. Sorry. Let me now provide you with an update on the progress in our business units, starting with Healthcare. Business unit Healthcare sustained its growth momentum and once again delivered above GDP growth. The business unit delivered broad-based growth, with net sales increasing by 4.9% to CHF 2.9 billion. Under the new leadership, Healthcare accelerated its strategy, execution, and unlocked growth beyond its midterm roadmap. It further increased the share of the commercial outsourcing business and achieved continued success in business development with partners like Eli Lilly, Pfizer, Sanofi, and BridgeBio. I will elaborate on this in due course. In addition, Healthcare invested in innovative therapeutic areas such as rare and cardiovascular diseases, strengthening its long-term growth platform. While Core EBIT amounted to CHF 86.5 million, the Core EBIT margin declined slightly to 3%. This was primarily driven by the ramp-up effect of new client wins, temporary mix and shift effects within the portfolio, and a particularly strong comparison base in the first half of 2025. This business unit enters the second half with a very strong business development pipeline across geographic and therapeutic areas and is well-positioned to pursue value-accretive M&A opportunities in higher-margin segments and services. Let me provide further insights into these future growth drivers of the business unit Healthcare. Business development remains a key growth driver as the pipeline has increased materially with roughly 80% of opportunities linked to commercial outsourcing. As mentioned, we are prioritizing larger and more strategically relevant partnerships, such as the recently announced collaboration with Eli Lilly, which will elevate our Healthcare business. During the last six months, we have signed a handful of such new, very sizable contracts that are each expected to contribute a double-digit or even triple-digit million turnover to our top line in the years to come. We therefore expect our top-line momentum to gradually pick up, with the potential to accelerate our medium-term growth rate by approximately 2% per year. While these contracts require some upfront investments to introduce and scale new products in different markets, they will elevate our Healthcare business to the next level over the next 48 months. We maintain our focus on higher-growth pharma, biotech, and medical device segments, especially in sophisticated therapeutic areas such as rare disease. This momentum is supported by attractive market fundamentals, including a growing middle class and an aging population, as well as favorable industry trends such as rising healthcare spending. We also continue to expand our Healthcare platforms through selective acquisitions in Asia and beyond. Our focus remains on high commercial outsourcing and own brands assets that strengthen our value proposition, expand capabilities, and create shareholder value. We maintain a very active M&A pipeline and currently have several opportunities in the due diligence phase. Moving to our business unit Consumer Goods. We achieved accelerated net sales growth of 3.4% to CHF 1.7 billion. At 4.7%, organic growth was the highest recorded in recent years. This result was driven by strong momentum across key markets including Malaysia, Thailand, Vietnam, and Singapore, as well as new client wins with expansions with clients as Nestlé, Calanova, Kraft Heinz, and Unicharm. Profitability was temporarily affected by mix effects, increased marketing investments, stronger growth in low-margin markets, and value-oriented consumer demand. As a result, Core EBIT stood at CHF 34.1 million. However, the business unit regained momentum during the period with decisive commercial and efficiency initiatives contributing to a stronger performance in the second quarter of 2026. Core EBIT is expected to improve further in the second half of the year, supported by continued net sales growth, a robust business development pipeline, profitability initiatives including cost-saving programs, and some M&A opportunities. Business Unit Performance Materials delivered a net sales growth of 8.4% to CHF 707.9 million. The Asia-Pacific region, which accounts for around 60% of the business unit's net sales, delivered the strongest performance, with growth of 15.2% at constant exchange rates. Europe also delivered growth of 3.6%. Acquisitions contributed to the positive performance. Following a softer start to the year, we returned to organic growth in the second quarter. Core EBIT growth was even stronger, increasing by an impressive 10.1% to CHF 59.8 million. We further increased gross and Core EBIT margins supported by favorable portfolio mix, higher shares of digital sales, and an effective price pass-through mechanism. In addition, we improved our working capital terms, mainly through diligent inventory management. In sum, the business unit grew its top line, increased margins, and improved working capital terms. Given the current market uncertainties, we remain cautiously optimistic about the growth trajectory. The business unit remains committed to continuing its progress in the second half of the year. Finally, let us please focus on our business unit technology. We achieved solid net sales growth of 4.7%. Performance was robust across key business lines, led by scientific solutions and semiconductor and electronics. The precision machinery business also delivered strong results, while the share of consumer goods and service revenue continued to increase slightly. The business unit delivered exceptional Core EBIT growth of almost 90% to CHF 13.4 million in the first half of 2026. We benefited from increased demand in the data center business, where we provide the supply, installation, and servicing of backup power solutions. This not only drove Core EBIT growth, but also margin expansion from 3.1% to 5.6%. Supported by a continued strong business development pipeline, including additional opportunities in the data center business, technology is well-positioned for a stronger second half of the year. I hand over to Ido, our CFO, who will guide you through our financial results in the first half of 2026 in more detail. Thank you. Thank you, Stefan. It is a pleasure, as always, to be with you today and walk you through our financial performance in the first half of 2026. As usual, I will refer to our results at constant exchange rates, which provide the most meaningful basis for assessing operating performance. As you are aware, the first half of 2026 was marked by ongoing geopolitical tensions and disruptions to key global trade routes. Against this backdrop, DKSH has once again delivered a solid operating performance, demonstrating the resilience of our business model and the safety that is inherent in our diversified portfolio. Not only did we maintain the pace of the last few years, we even accelerated top-line organic growth, meeting our goal of exceeding GDP growth. This was achieved by successful business development, the continued focus on executing our strategic priorities, and it is reflected in our key financial metrics. Net sales increased by 4.9% to CHF 5.5 billion, marking our strongest first half growth over the past three years. Growth is broad-based across all four business units, reflecting continued training the market to outsource business services. Core EBIT increased by 3.6% to CHF 163.4 million, marking the 11th consecutive semester of Core EBIT growth versus the comparative period. Core EBIT margins stood at 3.0%, 10 basis points lower than in the first half of 2025. Against an exceptionally strong prior half year, profitability was impacted by two effects. The first is related to translational FX rates, amounting to approximately half of the drop, and it is not operational. The FX effect on Core EBIT was 7.1, compared to a smaller 5.9 impact on net sales. This is because the Swiss franc has appreciated further against currencies in markets where we make more profits. The second effect is operational but temporary in nature. It is related to channel mix and ramp-up investments in selected business units to kickstart our accelerated net sales growth. It is important to note that while currency movements had an adverse impact on our reported operating results, they have been more than offset by significantly lower net finance expenses in the period. As a result, profit after tax and earnings per share are both up double digits, thereby securing overall shareholder return. Specifically, Core profit after tax stood at CHF 112.9 million, up 12.9% compared to last year. Earnings per share grew by 10.6% to CHF 1.56. Our asset-light business model and disciplined working capital management continue to support strong cash generation, resulting in free cash flow of CHF 147.7 million and a cash conversion rate of 130.8%, exceeding our target of at least 90% for the fourth consecutive year. In conclusion, we delivered our strongest first half net sales growth in three years, increased earnings per share by double digits, and generated excellent cash flows, demonstrating the resilience of our business model and the continued successful execution of our strategy. Let us now take a closer look at the drivers behind our net sales and Core EBIT development. We are particularly pleased with the acceleration of our top-line growth. Net sales increased by 4.9%. Demand was healthy across the group, with all four business units contributing positively to growth. Organic growth remained the primary driver of performance, contributing 4.1 percentage points, while acquisitions, net of divestments and business closures, added a further 0.8 percentage points. We are particularly encouraged by the continued momentum in business development across the group, a key driver of our broad-based growth. FX movements had a significant translational impact on our reported results, especially earlier in the year. The appreciation of the Swiss franc reduced reported net sales by approximately 5.8%. Turning to Core EBIT, we increased the operating profit by 3.6%, supported by both organic expansion, which contributes 1.1%, and contributions from recent acquisitions contributing 2.5%, underscoring our investments in higher margin businesses. Both performance materials and technology business units have been particular contributors to our M&A. These positive operating developments have been more than offset on a reported basis by translational FX movements, which reduced Core EBIT by CHF 12 million or 7.1%. As a result, reported Core EBIT amounted to CHF 163.4 million. Non-core items amounted to CHF 5.4 million and primarily related to one-off costs of restructuring, business disposals, or an associate in which DKSH does not have a majority stake. Net of those items, reported EBIT to CHF 158 million. While FX weighed on our reported results in the first half, the underlying development of the business remains very encouraging. This becomes even more apparent when viewed over a longer timeframe. Looking at our performance since 2022, we have consistently translated strategy execution into profitable growth and value creation. Since the first half of 2022, in constant FX, our net sales increased by a compounded annual growth rate of 4.3%, which is higher than the average annual weighted GDP of our markets. Over the same period, Core EBIT increased at an even faster rate of 8.2%, demonstrating our ability to translate top-line growth into disproportionate earning growth. This progress is also reflected in our profitability metrics. Since the first half of 2022, our conversion margin, defined as Core EBIT as a percentage of gross profit, has increased from 18.0% to 20.6%, a level we successfully maintained in the first half of 2026. Similarly, our Core EBIT margin has improved by 30 basis points since the first half of 2022 and remained at a strong level of 3.0% in the first half of 2026. I would like to highlight the significant progress we have achieved in logistics and distribution over the past five years. Through a relentless focus on operational excellence, supply chain optimization, and the increasing use of digital and AI-enabled tools, we reduced logistic and distribution costs by more than CHF 20 million per year, equivalent to 0.4% of margin improvement. As you know, a key foundation of our resilience and agility is our low-risk asset-light business model. Across the group, we operate predominantly through leased offices, leased distribution centers, and leased transport fleets. In IT, we typically leverage Software-as-a-Service agreements, avoiding more costly in-house developments. As a result, capital expenditure consistently remains at a very low level. In the first half of 2026, it amounted to merely 0.3% of net sales. At the same time, disciplined working capital management remains a key focus area. Working capital stood at the respectfully lean level of 7.8% of annualized net sales, in line with the strong level achieved in recent years. Together, these factors drive our ability to consistently convert earnings into cash. Free cash flow amounted to CHF 147.7 million in the first half of 2026, corresponding to a cash conversion rate of 130.8%, comfortably exceeding our target of at least 90%. Looking at the past five first half cycles, we delivered an average cash conversion rate of 124.5%. This strong cash generation provides substantial financial flexibility to fund organic growth, pursue value-accretive acquisitions, and maintain our progressive shareholder return policy. To conclude this section, our consistent cash generation over the years once again underlines the quality and predictability of our earnings, supported by an asset-light business model, disciplined capital allocation, and rigorous working capital management. Let us now move on to our balance sheet. Building on our continued focus on disciplined capital allocation, we maintain a strong balance sheet and high returns in the first half of 2026. Core ROIC remained at a high level of 18.7%, demonstrating our continued ability to generate attractive returns on the capital employed in the business. Core return on equity increased by 70 basis points year on year to 12.7%, reflecting stronger earnings and our continued focus on capital efficiency. Similar to last June, we concluded the first half with a minor net debt position of CHF 10.8 million. Given the strength of our cash generation, this remains a very insignificant leverage position. Our equity ratio increased by 20 basis points to 31.9%, at the same time providing a solid capital base and significant financial resilience. Let me conclude with a few additional financial indications for the remainder of the year. Regarding M&A, we estimate that acquisitions announced or completed to date will contribute approximately one percentage point to net sales growth in 2026. As this estimate only reflects transactions already announced, additional acquisitions would naturally provide further upside. We are currently viewing a number of attractive acquisition opportunities across our markets, and we remain committed to our disciplined approach to value-accretive M&A. While foreign exchange markets remain volatile, we currently anticipate a moderately negative translation impact for the full year, assuming prevailing exchange rates remain broadly unchanged. That which I said into materially improved the FX situation during the second half of the year. Our expectation for the tax rate is to remain within the range of 27%-29%. Capital expenditure is expected to remain within our historical range of 0.3%-0.4% of net sales, reflecting the continuous strength of our asset-light business model. Overall, we are encouraged by the momentum achieved in the first half of the year, supported by a strong balance sheet, substantial financial flexibility, and a healthy pipeline of business development and M&A opportunities. We remain well-positioned for the remainder of 2026. Thank you for your attention. Stefan, back to you. Thank you, Ido, for your commentary on our financials. To conclude, let us move to the outlook now, please. Despite ongoing geopolitical tensions and market uncertainty, recent forecasts continue to point to a resilient global GDP growth in 2026. Emerging and developing Asia remains particularly attractive, with projected growth of 4.9%, underlining the long-term potential of many of our key markets. While we continue to closely monitor developments in the Middle East, the direct impact on our business has been very limited so far, demonstrating, once again, the resilience of our business model. Looking ahead, we remain very confident to deliver sustainable Core EBIT growth and reconfirm our midterm roadmap with an acceleration in healthcare over the next years. We expect Core EBIT 2026 to be higher compared to 2025. As always, this outlook assumes economic growth in Asia Pacific, exchange rates to prevail at current levels, and exclude any unforeseen event. We are very well-positioned for a stronger second half of 2026, supported by improving commercial momentum, continued growth in our data center business, and acceleration of our M&A activities. To sum it up, DKSH demonstrated the resilience of its business model in the first half of 2026 and remains confident for the second half of the year. Our business model allows us to benefit from favorable long-term market industry and consolidation trends in Asia Pacific in the future. With that, I thank you all for your attention and invite you now to address your questions in our Q&A session. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their 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. Questioners on the phone are requested to disable the loudspeaker mode and eventually turn off the volume from the webcast while asking a question. Anyone who has a question may press star and one at this time. The first question comes from Gian Marco Werro from Zürcher Kantonalbank. Please go ahead. Morning, everyone. Thank you, Ido and Stefan, for the presentation. I have two questions in relation to the EBIT growth expectations for the second half of the year. As I sum it up out of the call, I see four drivers. Also then the tech supply orders that you have to the data centers as the moving parts for the EBIT growth in the second half. I want to touch on two of them. The healthcare growth you mentioned, the acceleration of 200 basis points versus normal growth. Can you specify that a bit? What time period you're looking at? Because in the last three years it was a little bit volatile. Is the base for your organic growth in healthcare more 4.5% or 5%, where you want to now bring up the 200 basis point acceleration? That's the first question. The second question is the tech income from associates. I assume it has been around CHF 5 million in the first half year. Can you quantify here also just your best guess about the tailwind then in the second half? Might this be even double-digit EBIT contribution from the associates in the second half? Thank you. Okay. Maybe let me answer the healthcare question first. Ido is going into the EBIT question. Thank you very much, Gian Marco. Look, yes, in healthcare, as I was indicating, we were very successful with our business development activities. Over the last couple of months, we signed a few material contracts which are going to materialize over the next 12 to 36 months. What I'm talking about is you have seen the growth rate in healthcare in the past, which always delivered GDP plus, was around, let's call it over the last two years, around 4%. I'm talking here about an acceleration of 2% on top of those 4%. This business is technically signed and sealed and need to be delivered. What we are talking here about is some new products, innovative products, which do require some upfront investment. The market needs to be built, and that is putting a little bit of pressure on our healthcare Core EBIT margin. I think it's a very good investment for the future to take healthcare completely to a new level. Ido, you want to say a few words? With pleasure. Good morning, Gian Marco. Regarding tech and share of profits from associates, I think your question, you indicated is about CHF 5 million in the first half year, and your question, what we can expect for the full year. Yes, we are shooting for a double-digit number there. These are large data center projects. There could be some one or two months delay. That's not unusual. We estimate it to be double digit by the end of the year in absolute profit. Thank you. The next question comes from Chiara Di Giammaria from Berenberg. Please go ahead. Good morning, and thanks for taking my questions. The first one is on the performance materials. If you can share with us more color on the market development and any impact from the Middle East situation. On the second one on M&A, if you can comment on the M&A environment now versus six months ago. If you see any changes in trends here and the expectation from owner developing. Thank you so much. Yeah, with pleasure. Look, I think regarding performance materials, we mentioned that we have seen some very good development in Asia where we delivered an uplift of 15%. We also returned to a very slow and light growth in Europe. The business in North America is definitely more challenging. Impact from the Middle East, direct impact from the Middle East is very limited. There are some price increases in the market because there are still some concerns about deliverability of a few products. We don't really see that or any limitations there in our portfolio. We are cautiously optimistic looking into the second half of the year after we have seen that the second quarter was +2% whereas the first quarter was -2%. At the end of the day, it's the impact of the Middle East on the underlying industries, and it's hard to predict now what is going to happen there in the second half of the year. On M&A, as indicated, we will definitely have a much stronger M&A contribution in 2026 than in 2025. I think we were referring to a few projects which are also slightly more sizable, which are under due diligence and where we are optimistic to deliver them in H2, and maybe a few will be announced in a much shorter time period. There's always this uncertainty with M&A. Only if it's signed and sealed you can be very sure, but we are very confident in that regard. What we see in the market is, I think I shared after the full year, that multiples are coming slightly down. I think we are finding a stabilizing ground there right now. Normally for the smaller deals, we continue to pay around seven times for those small deals, and there is availability on the market. In PM in particular, I think we see a little bit less activity from some of the other players in the marketplace, which is good for us. Yes, we have a very solid M&A pipeline on hand, which is the reason that we are expressing this confidence. Thank you. The next question comes from Nicole Manion from UBS. Please go ahead. Hi. Good morning. Thanks for taking my question. Just one please on consumer. Obviously, this is a business that you've restructured quite significantly over the last five years or so, a lot of which was focused on strengthening the profitability by streamlining SKUs and other things. Can you help us understand a bit more about the areas of the portfolio where you're maybe still seeing pressure and how you thought about the decision to increase the marketing versus some of the maybe kind of other efficiency measures that you then took through the half? Thank you. Maybe I can take this question. Good morning, Nicole. Good to have you back on the call. There's a very dynamic situation in the consumer goods environment, I think definitely in Asia-Pacific, but also, as far as I know, in the rest of the world. First, as we count our blessings, the organic growth of 4.7% is something that we have not seen since 2018 for our CG business. Reflecting some very strong BD pipeline, which Stefan mentioned earlier in his part of the presentation, and also that a winning market share, and a solid demand. I think last year when we closed 2023, we were quite celebratory closing a margin of 2.6%, which was ahead of our target of 2.5%. We said that, or at least alluded that future growth will be more balanced between margin and sales. What we see is we see solid demand, but the demand is very price conscious. We also see that many of our suppliers try to be very price competitive. Therefore there's more promotional fairly across the board. It's not just in one category. It's food, beverages. It's also in beauty care. I think the consumer is more selective on the price they pay pretty much across the entire industry. I cannot signify one of them for you. Great. Thank you. Okay. Maybe I can point out on top of that, Nicole, that Q2 was already better than Q1. We expect that trend to continue. Yeah, we have seen a specific, very focused, thank you, Stefan, price competition between various suppliers in Q1. We have the Chinese New Year, you have the Ramadan, and of course, coming into Easter in the countries that celebrate those. That has sort of declined later on in Q2. Thank you. The next question comes from Anil Shenoy from Barclays. Please go ahead. Yeah. Hi. Thank you so much for taking my question. Hi, Stefan. Hi, Ido. It's very nice to meet you for the very first time. Just two questions from me, please. The first one is on performance materials. You said that Q1 was down 2% and Q2 was up 2% organically. Just wanted to understand if you've seen any kind of pre-buying in Q2. I'm asking this specifically because one of your competitors in commodity chemicals has reported an exceptionally strong Q2 and guided for a really weak H2. I'm just trying to understand if the growth that you've seen in Q2, are there any one-off elements to it, or do you see that kind of growth continuing in H2 as well? That's my first question. Second is on the negative operating leverage, which we have seen in 1H. Revenue was up 4% organically, whereas EBIT was up just 1%. You explained that it's mainly because of the upfront costs for new contracts in healthcare and marketing spends in consumer goods. Are these the only factors impacting that, or is there something else as well? Also, are most of these costs behind us now? Do we see that operating leverage could be back to normal or maybe even positive in H2? Thank you. Thank you very much for your questions. In terms of Q2 versus Q1, yes, there was a pickup from -2% to +2%. Was there some pre-buying in there? Yes, maybe. Again, I would really like to highlight this has nothing to do with what we have seen during the days coming out of COVID. Maybe there is a little bit. Again, in Asia, where the majority of our growth is coming from, we still see an underlying demand across different industries. Maybe we are also differently impacted than some of other players which have the majority of their business here in Europe. What we definitely have seen that there is some price tailwinds in Q2 as well. I think I did mention it, that pricing was up around 2%. Again, I think our specialty business with the spread we have is very resilient. That's the reason why we look cautiously optimistic in H2. Can you help me again with your second question in healthcare? Hi. It was about the operating leverage. I mean, the upfront costs. Are they behind us now? Do you expect more costs to come in H2, and EBIT growth will again be lower than revenue growth in H2? Okay. Look, the investments in building those new brands, those innovative products across Asia, they will continue. They will definitely continue in H2, and they will also continue going into 2027, while we are scaling up the top line of those products. There is also own brands business, which we expect is going to pick up in a few countries. There were some headwinds story around the border issue between Thailand and Cambodia, et cetera. I expect that the healthcare margin is continue to grow over the years to come, maybe slightly slower than what we have seen in the past. You rightfully point out those significant contracts are going to deliver some operational leverage, and each one of those contracts is, at the end, when the investment phase is behind us, is margin accretive. Therefore, w e expect a slightly better margin in H2 than in H1 and an increase also of margin moving forward. As I mentioned earlier, based on the FX rates that we know today, of course they can change. We expect the translational impact that we saw, especially in Q1, to subside towards the second half of the year, which will also help margins. I would really like to point out, there will be a significant acceleration in the healthcare business over the next 36 months on the back of what we have signed. This is not to underestimate. There was a very successful streak and very strong confidence of our clients into DKSH healthcare, which is going to materialize. Okay. Yeah. Thank you so much for those answers. As a reminder, if you wish to register for a question, please press star and one on your telephone. The next question comes from Jon Cox from Kepler. Please go ahead. Yeah. Good morning, guys. I have a couple of questions and sort of follow-ups related to what my colleagues were asking. Just on the consumer side of things, it's great to see organic growth accelerating again. Of course, some people maybe start to get worried that you're going a bit towards the lower margin businesses. You say there's a lot of business there, but there's price pressure. Should we be worried that actually you're going to start getting this growth, but actually the margin and consumer goods won't recover? We've obviously lost 50 basis points in H1. Do you think that's going to recover in H2? What are your thoughts about chasing maybe only delivery business or logistics business in consumer? Second question on healthcare. You're talking about pressure on margin again. Are you saying that actually the healthcare business will be sort of a flat margin for a while or slightly lower as that growth picks up? What I'm trying to get to, of course, is obviously your margin was down in H1 for a group. How confident are you of reaching this minimum 10 basis points margin improvement this year, given the headwinds in consumer and given the headwinds in healthcare? I could even say the same about the following year, if you're talking about these ongoing investments in healthcare. How confident are you that you can actually move margin, in the next one or two years? That's sort of like a margin question. Second one just on FX, and you've talked about it a lot, but historically you've always said it's only translation, it's only translation, it's only translation, and suddenly we're starting to see an impact on your margin from the FX headwinds. I wonder if you could just talk about that a little bit. Obviously, we can see that your financials line was far better, which obviously reflects what's happening with currency. Maybe just you can talk a little bit more about that and the currency headwinds and should we be worried? Clearly over the last four or five years you've seen substantial currency headwinds and that's probably not going to go away, you guys being a Swiss franc reporter. Just the last one on this EPS. You tend to report net for profit after tax. You give an EPS for that. You do it for shareholders and there's an EPS. You do core. You do core for shareholders with an EPS. It would be great if you could, in your release, just tell us what you were using there because I was amongst those analysts probably thinking, "Well, how did you get to that EPS figure?" Just as a suggestion, it would be nice just to have core for shareholders. I think that's the one everybody's focusing on rather than all this profit after tax and all this stuff. What was the share count you actually used in H1? Thank you. Okay. You start. Yes. Consumer FX EPS. I'll take over. Good morning, Jon. Thank you for the many questions. I'm just trying to recall exactly the first one. Overall, yes, as I mentioned before, it's evident we have taken a few step backwards in the CG margin business. This comes while increasing the top line. It was part of the strategy going forward. We also see some, especially in the consumer goods, there's a lot of happening in the consumer part of the market. I made a small search in my favorite AI engine this morning of the number of consumer goods companies that are reporting promotional pressure. The list is very long. We also operate in a certain environment that we can so much influence in order to impact and continue to grow margins. As we mentioned, Q2 margin was stronger than Q1. We expect half two margin to be stronger than half one. We are adjusting some of our cost structures together. We also expect to have less promotional pressure. We expect it to be better. Will this be another year in which we grow 10 basis points or 20 basis points in the case of CG margin? Probably not. We are targeting to be flat versus last year after the second half. It is an ambitious target to be honest because we are where we are and we are influenced by the market. That's about the consumer good. I would not worry about deterioration. It's not change of strategy. We're going to adjust based on the current situation of the business. Sorry, just to come back on that. Yeah. Just on that consumer, you're saying that H2 margin will be in line with H2 last year margin. You're talking about a flat? Or are you saying after H2 you'll start to see an improvement again, i.e., this year it will be down in H2 versus H2 last year? Yeah. I think we will see in the second half equal to last year. Say that again. Repeat. Sorry. Repeating. Yeah. We are targeting in the second half year to have similar margin to last year's second half year. Similar. Okay. Yeah. Great. Got it. Yeah. Sorry. Okay. Maybe I take the next one on healthcare and then Ido, come back to your FX and EPS. Jon, no, I am really not worried about the margin pressure in healthcare. Let us take the bigger picture very briefly across all business units. I think over the last couple of years, I think very consistently we improved the margin by 10 basis points. If now for like six months or maybe even 12 months at one point of time the margin is stable or dropping by 10 basis points, I would not read too much into that. There are significant growth opportunities materializing in healthcare as I was saying, and on the other hand we were all in the past, not very happy with the overall top-line acceleration, right? What we have seen over the last couple of years, and now this is materializing, but it does require some investment. Those investments are done for a really good reason. It is a business model with strong operational leverage, so automatically the margin will be driven forward by the size we are adding in the top-line. On top of that, in healthcare in particular, coming back to your question, we see an acceleration of the commercial outsourcing, which is higher margin. The other thing also, the M&A we have on hand. How this exactly falls every six months, it is a little bit up, flat, or whatever. It is really hard to predict also when do we need to launch what kind of investments when the product is ready being launched. Clearly, I do not foresee, as you were provoking, in 2027, a flat margin. That margin will continue to grow over the years to come. The big acceleration you will see in the top-line. I hope that was clarifying. Yeah. Sorry. What about for the group margin for this year? Can you get 10 basis points after what happened in H1, or you think that that is a bit of a stretch. That's our objective. Regarding investments? That is. If you're on target. that is our objective. Yeah We are reasonably confident about that with the investments we have on hand. Okay, great. Maybe I can pick up the questions on effects. First of all, there was the question about the translational effects. Indeed, we repeat that on our EBIT margin, there is an impact which relates to translational effects. The math of the matter is that in markets in which we are more profitable than others, the deterioration, the translational deterioration of the local currency versus the Swiss franc has been stronger than the others. There's a mixed effect within these translational effects that is impacting EBIT more than it does net sales. Because in those markets, we earn more money, the local currency has just declined further. It's a mathematical impact within our translational effects. I repeat that this is the main impact. On the net finance cost, as we always said in the PM business and tech business, we are hedging each transaction that we make above CHF 10,000K, to be precise. Last year, we saw a very significant deterioration or appreciation of the Swiss franc in the beginning of the year. Those transactions were hedged, but from a country perspective, we took the help and the protection that the hedge was given below EBIT and not within the P&L. After a while, when we saw that those countries depreciate, markets depreciate, that we have adjusted prices accordingly, the future deal is giving us the margin that we target. This has happened in this year, and with less depreciation of the Swiss franc, we see a lower impact of FX cost below the EBIT. I know it's a bit technical. Happy to explain further. This is the effect that you see net finance cost below EBIT. Any best guess for net financials for the year? We'll probably duplicate in absolute the first rate of the first half rate. Again, it depends on assuming that there's no major volatile FX movement in the second half. Right. Okay. Then on the EPS? On EPS, we will be very pleased to provide both numbers, EPS, as reported and adjusted for no core items. Actually, the figure that was published this morning corresponds to the Core EPS. That was the CHF 167. It is a straightforward calculation because we do provide all the adjustment from reported to core earnings. We will add the earnings per share of both measures. Do you have the share count to hand you use incidentally? Yeah. It's 65,006,033 or 53. Thank you. 65,006,313. So, 65 double zero 6313. Right. Thank you. Yeah. Thank you, Jon. The next question comes from Andrew Noel from Chemical ESG. Please go ahead. Hi. Thank you for taking my questions. I've got a couple, please. I just wanted to come back on something you said about on PM, that some of your competitors are sort of taking their foot off the gas when it comes to M&A. One of the themes that your competitors always talk about is that they build these relationships with companies over months, years. My question is, to what extent can you sort of jump in there and overturn those relationships if it's the case that they're doing less? I noticed that on the slide decks, Performance Materials was the only one that didn't mention M&A. I'm just wondering if there's the level that you expect this year. The second question, I don't know if it applies better to technology or what, What's the opportunity in electronic materials as opposed to equipment supplies? I imagine that your customers buy directly from Solstice and DuPont as well. Over time, do you think it'll become a n interesting area for you on the distribution front. Thank you. Okay. Thank you. Thank you very much. On Performance Materials, all I can say is, look, we have good relationships across the areas. We have no limitation in terms of leverage we have on the balance sheet. Yeah, we can act, we can move fast on those transactions. We signed a material one in H1 in Malaysia, a blending business in the food section, which is going to be closed, if I'm informed correctly, by the end of this month. There will be also another one most likely being announced during July. There is M&A activity. I don't know what you're referring for when you said we don't mention it. I need to double-check, to be honest. No, there is an M&A pipeline. We also announced the one in Italy, I almost forgot, most recently, I think last week. Don't worry about, there is M&A activity, and we will continue to deliver M&A also in performance materials in a responsible way on responsible multiples. In terms of electronic materials, we already accelerate, I think, the sales of consumables because with enlarging the installed bases we have across the different sectors, because we also do installation and after-sale services, which includes spare parts, et cetera. This is a business stream which is continuously growing. I don't know how exactly you define electronic materials. If you are talking about ingredients going, this is more on the PM side. Normally with smaller spare parts outside of our equipment base, normally we don't deal. Thank you very much. You're welcome. Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Till Leisner for any closing remarks. Yeah. Thank you so much, everybody, for joining today's call. Appreciate to stay in contact with you. Investor relation teams remains available also after the call, and I'm just handing over to Stefan for some closing remarks. Yeah. Thank you. Thank you very much for your interest. The team here really looks forward seeing and meeting you guys over the next couple of days, and to continue our conversations. Thank you very much, and have a great weekend in the meantime.