Ladies and gentlemen, welcome to the Givaudan 2021 full- year results Conference Call and live webcast. I am Alice, the Conference Call operator. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Gilles Andrier, CEO. Please go ahead. Thank you. Ladies and gentlemen, good afternoon, good evening to Asia, and good morning to the Americas. Welcome to our 2021 full- year results Conference Call. Tom Hallam, our CFO, is alongside with me on this call. We will take you through the presentation before answering your questions at the end. The company's news on our full- year results were published on our Givaudan website at 7:00 A.M. Swiss time this morning. This is where you can also find the slides for today's presentation. Along with the company news on our website, our 2021 integrated annual report is also available. I'd like now to start going through the presentation and invite you to turn to slide 3 to go through our performance highlights. I'm very happy to announce another excellent set of figures. I'm equally proud to report that we are off to a good start to our 2025 strategic cycle as we close the first year of this five-year plan. In the current environment, these strong 2021 results demonstrates our market leadership, the resilience of our business model, and the important role we play in sustaining along with our clients in the global supply chain of key consumer product categories. I'm once again, very proud of the entire Givaudan organization for their dedication, their agility during this challenging period for the second year in a row, and for enabling us to continue to support our customers to make products available to billions of consumers every day. In 2021, we reached sales of CHF 6.7 billion, a growth of 7.1% on a like-for-like basis, and 5.7% in Swiss francs. Our sales growth for the full- year 2021 remained clearly ahead of the market. This strong growth was supported by many levers, once again by the good contribution of high-growth markets, the strategic focus areas as well as the acquired businesses, the continuing performance of the resilient part of Givaudan representing 84% of our portfolio. At the same time, the very strong recovery of the less resilient part, which had been impacted in 2020, namely Fine Fragrances and to a lesser extent, food service, both segments which I will further detail in this presentation. Launches of new products were at a higher- level than in 2020. Our new business pipeline remained very strong in anticipation for a return to normality, and our win rates have been very healthy. We achieved an EBITDA close to CHF 1.5 billion, increasing 6% over 2020. This means an EBITDA margin of 20.1%, up from 22% in 2020. On a comparable basis, EBITDA margin was 22.5%. The free cash flow of CHF 843 million is up 4% versus 2020 and represents 12.6% of sales. At the AGM of 24th of March 2022, the board of directors will propose a dividend of CHF 66 per share, an increase of 3.1% year-on-year. To complete those highlights, all our 2025 strategic focus areas are on track and have contributed to these results. Let's turn now to slide 4. Both divisions contributed strongly to our growth. Fragrance and Beauty reached almost CHF 3.1 billion, growing 6.6%, and Taste and Wellbeing reached CHF 3.6 billion, growing a record ever of 7.6%, both growth rates being on a like-for-like basis. The good growth was achieved across most product segments with a very strong performance in Fine Fragrances and Active Beauty for the Fragrance and Beauty division, as well as in Beverages, savory, and Snacks for the Taste and Wellbeing division. We also benefited from a regained momentum of our local and regional clients compared to 2020, whilst our sales with global customers remained on a good momentum as in 2020. Once again, all our strategic focus areas, complemented by the acquisitions, have contributed to our growth. To name a few, high growth markets, health and wellness, naturals, plant-based proteins, and Active Beauty. Let's turn now to slide 5. On the left-hand side of this slide, you can see that over the last two years of pandemic, we have been growing 5.5% on a like-for-like basis, faster than our guidance, both divisions contributing with an average 6% for Fragrance and Beauty and 5% for Taste and Wellbeing. On the right-hand side of this slide, this table was developed specifically in the context of the COVID-19 pandemic, to visualize the effects of the pandemic on the portfolio of Givaudan, showing the respective growth rates of both the lower and the higher impacted businesses. Starting with the lower impacted business, with increased sanitation and many confined at home in 2020 and in 2021, we have seen the more resilient part of Givaudan, which totals 84% of group sales, strongly contributing to sales growth. Namely, Consumer Products and Active Beauty, which represent 82% of Fragrance and Beauty, which grew 3.5% in 2021, delivering an average 5.8% over two years, and the core business of Taste and Wellbeing consumed essentially at home, which represents 85% of the division, continuing to grow 7.4% in 2021, which makes an average of 7.2% over two years. On the other hand, the less resilient part of the business, which represents 16% of group sales, namely Fine Fragrances, which represents 18% of the Fragrance and Beauty division, and food service, representing 15% of the Taste and Wellbeing division. As you can see in this slide, the higher impacted categories have grown 16.5% for the group and are back to the level of 2019 pre-pandemic. Fine Fragrances growing 22.5% in 2021, which means a CAGR of 6.9% over 2 years, significantly higher than expected. Food service has also recovered in 2021, growing 8.8%, but both later and slower than Fine Fragrances. As restrictions in relation to out-of-home food and beverage consumption started to be eased in certain markets, food service overall is still below 2019 level and is expected to continue to recover in 2022. In summary, the strong 7.1% growth for the group in 2021 has been supported by 2 factors. 1, a sooner and stronger than expected recovery of Fine Fragrances, and 2, a sustained strong growth in 2021 of our resilient business against the strong comparable of last year. Let's now turn to slide 6. Mature markets, which represent 57% of our sales, have significantly contributed to the growth with a like-for-like growth of 6.3% led by the strong rebound in Europe and in North America in 2021. Meanwhile, Japan was slightly down, yet not recovering from 2020. High growth markets, representing the other 43% of our sales, continue to deliver the highest growth with 8.3% despite the current pandemic situation still ongoing in many large markets around the world. Latin America performed strongly, led by Argentina and Mexico. The Middle East and Russia also contributed with strong growth levels, as well as did China, which maintained a double-digit growth throughout 2021. The other parts of Asia have also recovered, including Indonesia and India, while the Philippines and Thailand were generally more heavily impacted by the COVID crisis. Our size and operations footprint give us a unique exposure to the diversity of this high growth market in which we continue investing, both with additional talent and new facilities to service a wide diversity of customers and markets. As in 2020, we have seen in 2021 how critical our geographical balance contributes to the natural hedges against a crisis where timing can be very progressive, with a different intensity depending on the geographies. Please now turn to slide 7. I'd like to highlight the sales development by region for the group in more details. After many years of double-digit growth, sales in Latin America continued to perform very well at those levels. Latin America recorded another outstanding growth of 14.4%, driven mainly by Argentina, Mexico, Colombia, and Brazil. Volume growth and market share gains contributing to most of the growth. Sales in Asia-Pacific, as mentioned earlier, recovered from 2020, despite parts of the region still being impacted by the pandemic. Overall, the growth in Asia-Pacific was 5.7%, with China achieving another double-digit growth after 2020 and India and Indonesia back to growth. North America, which reopened earlier than other regions in 2021, grew at a healthy 4.8%. EAME grew a record 7.8%, supported by the strong recovery of various markets, particularly France, Italy and Spain, and Germany for the mature part of Europe, Russia and the Middle East for the high-growth part of Europe. Let's turn now to slide 8. The Fragrance and Beauty division grew 6.6% on a like-for-like basis and 5.8% in CHF. This sales growth was mainly driven by the rebound of the Fine Fragrances and Active Beauty businesses, which were both particularly impacted by the COVID-19 pandemic in 2020. Fine Fragrances increased by 22.5% on the like-for-like basis against a sales decline of 6% in the prior year. After the significant negative impact of the COVID-19 pandemic in 2020, sales rebounded across all regions and all customer groups, driven by the high performance of the existing portfolio of perfumes and by a significant level of new wins. All regions delivered strong sales performance with both mature and high growth markets delivering double-digit growth. The Western Europe and Middle East regions had the most significant results, with both recording strong double-digit growth. Consumer Products sales increased by 1.5% on a like-for-like basis against the strong comparable growth of 9.1% in 2020. It was driven by an increased demand for household, health, and Personal Care products related to the COVID-19 pandemic. The sales growth in 2021 was achieved mainly in the high growth markets and across all customer groups. On a regional basis, Latin America reported double-digit sales growth spread across most sub-regions and led by international customers. In Asia, the sales growth was driven by local and regional customers, with China delivering high single-digit growth. Europe, Africa, and the Middle East sales were flat against a high prior year comparable, while sales in North America declined slightly, also against a double-digit comparable growth in 2020. On a product segment basis, the sales growth was led by Fabric Care, followed by Personal Care. Sales of Fragrance Ingredients and Active Beauty increased by 14.2% on the like-for-like basis. Active Beauty saw a very strong rebound in 2021 and reported a strong double-digit growth in both high growth and mature markets, most notably driven by the strong double-digit performance of the premium active ingredients. Fragrance Ingredients delivered a strong single-digit growth in 2021. Now let's turn to the next slide, number 9. Sales of the Taste and Wellbeing division grew 7.6% on the like-for-like basis and 5.7% in Swiss francs with a moderate negative currency impact. Let me mention that this performance is to date the highest ever achieved by the division since the spin-off of Givaudan in 2000. The strong sales performance was driven by new wins and good business momentum across all regions and customer groups. While the sales performance was still impacted by the pandemic across many countries, there was a continuing recovery from the Q2 2021 onwards. As increasing vaccination rates and progressive reopening resulted in a higher demand for food service products, which had been the most impacted business in 2020. In the meantime, in key strategic focus areas, sales increased double- digits in health and wellness, plant-based proteins, and mid-single- digits in naturals. From a segment perspective, the strong sales performance was achieved across all segments and mainly in Beverages, Savory, and Snacks. Sales in Asia-Pacific increased by 7.4% on a like-for-like basis. In the high- growth markets, China and Malaysia delivered strong double-digit performance, followed by solid single-digit growth in Indonesia and Vietnam. In the mature markets, the growth was driven by Singapore, Australia, and Korea. Sales in South Asia, Africa, and the Middle East increased by 6.1% on a like-for-like basis. Double-digit growth was achieved in India, Cameroon, and Nigeria. Egypt and South Africa, which were still heavily impacted by the COVID-19 pandemic, showed mid to high single-digit performance. Sales in Europe increased by 6.3% on a like-for-like basis. The mature markets of Italy and Ireland achieved double-digit growth, followed by mid to high single-digit growth in Germany, Belgium, and Spain. In the high- growth markets, there was excellent business momentum driven by the double-digit growth in Russia and Poland. The growth was achieved in Beverages, sweet goods, Savoury, and Snacks. On a like-for-like basis, sales in North America increased by 5.8%, driven by the strong performance in the Beverages and Savoury segments. The performance was a result of new wins, a rebound in food service, and the growth of existing business in beverages, immunity products, savory, and sweet goods. Sales in Latin America increased 19.3% on the like-for-like basis, led by strong double-digit volume growth in Mexico, Brazil, Colombia, Chile, and Argentina, and across all segments. Let's turn now to slide 10. Acquisitions have been an important part of our historical growth trajectory and are all well aligned with market trends and strategic priorities. Since 2014, we have acquired 20 businesses for a total of over CHF 4.1 billion, including most recently in 2021, DDW, the Color House, and Custom Essence in the US, and Myrissi in artificial intelligence. Each one with a very strong and natural strategic rationale as well as a perfect cultural fit to Givaudan. In the case of DDW, it makes Givaudan now the leading player globally in natural colors, a space which is part of the functional ingredients market and is critical to the success of our customers. Custom Essence is a very valuable addition to our local and regional customers in the US. Those 20 acquisitions represent an annual yearly contribution of more than CHF 1.6 billion to our group sales. We continue to aim at further value creative acquisitions to complement our core capabilities and increase our portfolio of naturals, health and wellbeing, Active Beauty, Integrated Solutions, and local and regional clients, as well as new adjacent business areas or technologies with which we believe we can further provide value to our customers and our shareholders. With this, I'd like now to hand over to Tom, who will give you more granularity on our financial results. Thank you, Gilles. I would also like to welcome all of you to the call. On the following slides, I would like to focus on the operating performance, the cash flow, and the balance sheet of the group. Let me start with the performance highlights on slide 12. Group sales increased this year to CHF 6.7 billion, an increase of 7.1% on a like-for-like basis and 5.7% in Swiss francs. This result includes the full- year impact of Ungerer, as well as one month of sales from DDW and Custom Essence, the two companies that we acquired in December 2021. The group's EBITDA increased by 6% to CHF 1.5 billion, and the reported EBITDA margin increased from 22.1% in 2020 to 22.2% in 2021. The underlying EBITDA increased to CHF 1.5 billion and a margin of 22.5% in the year, compared to 22.8% in 2020. The group achieved a free cash flow of CHF 843 million, or 12.6% of sales. Our net debt to EBITDA was 2.97 at the end of the year, compared to 2.89 at the end of December 2020. Please turn to slide 13, which shows the exchange rate development. This slide shows the comparison of the exchange rates of 2021 versus 2020. In the prior year, we saw the Swiss franc continue to strengthen against all major currencies in which the group operates. This resulted in unfavorable exchange rate effects in the prior year. In the current year, however, we see some relief, especially with the development of the US dollar and the British pound against the Swiss franc. Overall, the impact has been limited because our operational and geographical spread continues to provide good natural hedges, and our EBITDA margin remains well- protected against currency fluctuations. Please turn to slide 14 for an overview of the operating performance of the group. The gross margin increased from 42.1% in 2020 to 42.7% in 2021 due to continued efforts to increase productivity gains and strong cost discipline. The EBITDA was CHF 1.5 billion in 2021 compared to CHF 1.4 billion in 2020. We had a number of one-off items in the year amounting to CHF 22 million, mostly related to the integration of the acquired companies and the optimization of our manufacturing footprint. The underlying EBITDA margin was 22.5% compared to 22.8% last year. On a high- level, we estimate that we have incurred approximately CHF 30 million of incremental cost related to COVID-19 in 2021 as we continue to focus on ensuring that we keep our customers supplied. These costs are mainly people- related, for example, temps, overtime, or related to freight and transportation. The operating income increased to CHF 1.1 billion in 2021 compared to CHF 996 million in 2020, which is an excellent increase of 9.3% versus the prior year. On the next two slides, I will spend a few minutes on the operating performance of the two divisions. If you turn to slide 15, we will start with Fragrance and Beauty. Fragrance and Beauty recorded a sales increase of 6.6% on a like-for-like basis and 5.8% in Swiss francs, mainly driven by the excellent rebound of the Fine Fragrances business during the year. EBITDA for the division in 2021 was CHF 696 million compared to CHF 677 million in 2020. The underlying EBITDA margin was 22.6% in 2021 compared to 23.6% in 2020. The decrease in the margin is explained by the increased pressure on our supply chain costs, which I had previously referred to. If you now turn to page 16, we will cover the performance of Taste and Wellbeing. Taste and Wellbeing recorded an outstanding sales increase of 7.6% on a like-for-like basis and an increase of 5.7% in Swiss francs. As Gilles also mentioned, the division showed a strong recovery from the COVID pandemic, especially in the second half of the year. A continued focus on internal costs and continued productivity gains increased the EBITDA by 9.2% if we look at the local currency perspective. The division recorded an EBITDA of CHF 786 million compared to CHF 720 million in the prior year. On a comparable basis, the EBITDA margin was 22.4% in 2021 compared to 22.2% in the prior year. Please turn to slide 17, which shows the amortization of intangible assets. This slide has been updated to include the acquisitions of DDW and Custom Essence in 2021, and it gives you a perspective of the future expected amortization, most notably the CHF 160 million expected for 2022. Please turn to slide 18, which shows the net income. The net income before tax increased in 2021 to CHF 965 million, mainly as a result of an increase in the operating income and stable non-operating expenses despite slightly higher interest charges related to the recent acquisitions. The effective tax rate was 15% in 2021, exactly the same as in 2020. The net income was up to CHF 821 million in 2021, which is a solid double-digit increase of 10.5%. The net income margin was 12.3% in the year. Basic earnings per share was CHF 89 compared to CHF 80.59 in 2020. Please turn to slide 19, which shows the free cash flow. In 2021, we had again an excellent free cash flow of 12.6% of sales, very similar to the 12.8% in 2020. During 2021, Givaudan generated an absolute free cash flow of CHF 843 million compared to CHF 811 million in 2020, an increase of 3.9%. Total net investments were CHF 247 million, and as a percentage of sales, net investments were 3.7% of sales compared to 3.4% in the prior year. The main increase in the investments was the program to implement our global IT operating systems in the acquired companies. Working capital was 24% of sales, a slight improvement compared to 24.4% in 2020. Please turn to slide 20. Over the last 21 years, the company has generated a cumulative CHF 10 billion of free cash flow. Including the proposed dividend for 2021, Givaudan has returned CHF 6.4 billion to shareholders in the form of either dividends or share buybacks since its spin-off in 2000. As mentioned in previous years, this clearly underlines the strong commitment of Givaudan to return surplus cash to shareholders. Based on the continued strong cash generation, the board of directors will propose an increase to the dividend to CHF 66 per share from CHF 64 in 2020, an increase of 3.1%. Please turn to slide 21. This slide shows a well-balanced debt profile with interest rates, which we have locked in at attractive rates. At the end of the year, the net debt was CHF 4.4 billion, with a weighted average interest rate of 1.4% at the end of 2021, compared to 1.5% in 2020. Finally, please turn to slide 22, which shows the leverage ratio and the net debt to EBITDA ratio. At the end of the year, the leverage ratio was at 51%, compared to 50% at the end of 2020. The net debt to EBITDA ratio was 2.9% or 2.9 times, compared to 2.89 times in the prior year, with a small increase driven by the acquisitions of DDW and Custom Essence at the end of the year. With this, I would like to conclude my section of the presentation and hand back to Gilles. Thank you, Tom. Now let me come back to the 2025 strategy and the outlook for 2022, which I'll comment further in the next coming slides. Now let's turn to slide number 24. Let me quickly remind you the main features of our 2025 strategy. The company's 2025 ambition is to deliver sustainable value creation for all stakeholders. Givaudan's 2025 strategy is fully in line with our purpose while placing customers at the heart of our business, supporting them to grow and create products that are differentiating for their brands and loved by consumers. The 2025 strategy is focused around three growth drivers, expand the portfolio, extend customer reach, and focused market strategies. It is supported by four growth enablers which are aligned with the company's purpose domains, namely creations, nature, people, and communities. These three growth drivers and four enablers are all underpinned by a commitment to excellence, innovation, and simplicity in everything we do. Let's turn now to slide number 25. Ambitious targets are an integral part of Givaudan's 2025 strategy and culture, with the company aiming to achieve organic sales growth of 4%-5% on a like-for-like basis, and a free cash flow of at least 12%, both measured as an average over the 5-year period of the strategic cycle. In addition, the company aims to deliver on key non-financial targets around sustainability, diversity, and safety, all linked to Givaudan's purpose. As I mentioned at the start of my presentation, 2021 has been off to a good start of our strategic cycle, but a lot more needs to be done by 2025, and the environment is by definition the critical unknown in the equation. Let's move now to slide number 26, our 2022 outlook. We are confident in our capabilities, the quality of our portfolio, our creative strengths, and our ability to build on the strong start of this strategic cycle. For 2022, visibility remains short as the pandemic is still around as we speak. As discussed in the last few months, we clearly anticipated high inflation in raw materials. We plan for raw material price increase of about 9% in 2022. As you know, we purchase more than 12,000 different raw materials around the world, and most, if not all the categories of materials are increasing. We have ongoing pricing actions to compensate for the higher input costs, which will allow us to recover the absolute value over the next 18 months. The entire organization will keep focusing on maintaining operations and supply chain performance at high- levels to support our customers while keeping costs and cash discipline throughout the business. Secondly, we will continue our focus on integrating the recently acquired businesses in our Givaudan operating platform. Integration costs should be in the range of CHF 25 million in 2022. Finally, we keep focusing on implementing our broad-based ESG objectives in line with Givaudan's purpose. With that, we have arrived at the end of our 2021 full- year results presentation. Ladies and gentlemen, many thanks for your attention. Now Tom and I are looking forward to your questions. Our first question comes from the line of Ms. Lisa De Neve with Morgan Stanley. Please go ahead. Hi. Good afternoon, Gilles and Tom. Thank you for taking my question. I have two. You mentioned this morning that some of the price increases you have pushed through may have some impact on volumes. Can you please elaborate whether you already have seen some change in demand or less elasticity from your customers? And if so, whether particular segments of your portfolio may be a little bit more vulnerable, perhaps given the relatively sharper inflation. What I'm also trying to gauge here is whether you are specifically expecting from your customers to be more cautious on the ingredients they buy, the volume element of that because of the degree of inflation, or whether you're just more cautious on the end consumer perhaps tightening its wallet more broadly this year. Thank you. No, I guess there's been a bit of a misunderstanding or misquotation of what I said, Bloomberg. I actually never said that price increase would have an impact on our volumes. What I just said is that, you know, our clients were seeing inflation across many different categories of products, of ingredients that they are buying, not just the ones we are selling. They are increasing their prices. I'm just saying that, you know, it could put a bit of pressure on the volumes. I have absolutely no indication on any volumes decline because of that, and this is just a general comment. No specifics about us as it relates to price increase influencing our volumes growth. Okay. That's super helpful. My second question is, you've guided for a 9% raw material inflation for this year, which you expect to lap at about 18 months. I mean, could you give us a bit of a rough guidance of what you expect to see for pricing this year in the next 12 months? Similarly to that, are you just pricing through raw materials inflation, or also able to achieve some of the freight and specifically this year, labor cost increases you may see? Thank you. Yeah, Lisa. Just on the two points, you know, as we've said, I mean, we expect to fully recover the impact of the raw materials with price increases over 18 months. You know, we've done that in the past. If you look at previous cycles, you know, we've been very consistent in terms of our ability to deliver. On the 9%, so the 9% is raw materials. In specific markets where we also have other inflationary elements, we also have pricing actions to offset. You know, that's very specific markets. Okay. Thank you very much for that. The next question comes from Heidi Vesterinen with Exane BNP Paribas. Please go ahead. Hi, good afternoon. I wondered if you could talk about the pluses and minuses as we think about the 2022 margins, please. Can we, for example, add back the CHF 30 million that you had talked about, which was a cost in 2021? Or do you still have these costs? That's the first question. Thanks. You know, Heidi, I think that if you look at the costs that we have incurred, and as I mentioned it before, I mean, it's temporary labor, it's overtime, it's freight and transportation. You know, by definition, they are temporary and we should get them back. I think the timing is really out of our hands. It depends very much on when governments are lifting restrictions. I think you've got two variables. The first is, you know, the rate at which people are recovering, and the second is when governments are lifting restrictions, which is a little bit out of our hands. You know, as we said, it's a temporary cost, and we would expect to get those costs back as restrictions are lifted by governments. In terms of other moving parts, are there any, you know, M&A synergies or anything else that we should be thinking about? I mean, I think if you look at the big picture items. I mean, as we've talked about in the past, you've got the raw materials, the price pass-through, what we would call the mechanical dilution. I mean, as Gilles has referred to, our objective is to recover the absolute raw material impact with price increase. As I said, the timing on the CHF 30 million. The other item is, as you mentioned, on acquisitions. It depends very much on our ability to integrate and the speed at which we can integrate, particularly some of the later acquisitions. I think those are the main items that you've picked out. Then the other question is on M&A. You talked about looking for further opportunities. Your leverage is on the high side at the moment. How far are you willing to take it, please? Thanks. Yeah, sure, Heidi. I mean, I think if you look back historically, you know, we've been much higher at some point. You know, we would like to, you know, at a certain point, de-lever, but that's also because that gives us the flexibility and the opportunity to do acquisitions. You know, we feel very comfortable with anything up to, I would say, four times net debt EBITDA. You know, that's what we're prepared to do, I would say, if we are convinced by acquisitions. Maybe I just also hand it to Gilles to talk about the, you know, the three areas where we continue to focus in terms of M&A. Yeah. Those areas are very much aligned with our 2025 strategy as you've seen in the nature of what we have acquired in the 20 companies that we acquired over the last few years. It's mainly when we look at the core business of, let's say, fragrance and flavors, it has a lot to do with the local and regional clients. As you've seen with Custom Essence, we are very happy to, you know, this is one of the first asset that actually we buy in the US, where the market of L&R clients is one of the largest in the world. Very good to see Custom Essence combine with what we have at Givaudan and really create a force, you know, to capture growth with L&R. L&R is one. The second one is really clearly about the space beyond, the adjacent space beyond on the fragrance side. You know, still to build on the Active Beauty. Active Beauty has been a really, I would say, a success story. I mean, we started from zero six, seven years ago, and the combination of acquisition with double-digit growth for the last seven years has led us to actually achieve our initial goal, which was to reach more than CHF 100 million by 2020. Now we are at CHF 130 million. A great asset which is still growing in Active Beauty. You... Continuing in this space, as opportunities arise, there are not many, but clearly, we are committed to continue growing this business, which is adjacent to Fragrance. It's really about on the Taste and Wellbeing side, where the adjacencies are actually even larger if we consider the market we are looking into. If you remember, in our 2025 strategy, we said that for the Taste and Wellbeing division, we are looking at the additional market of CHF 14 billion of highly specialized ingredients. The starting point being Naturex. With DDW coming in, that adds to our portfolio in natural colors. We're going to still look for acquisitions in the space of those, let's say, those ingredients, you know, which are not necessarily flavors, but are clearly highly differentiating for clients. That's another one. You've seen that we've also acquired companies in technologies. You know, Myrissi, you know, which is really an interesting artificial intelligence expertise that is helping us also on the fragrance side. We can look into delivery systems. Anything that would help us also increase our ability to manufacture ingredients, especially on the fragrance side, you know, is also something to add to our chemical plants, making our own ingredients. That includes biotechnology. The different spaces we are looking into and, I would say opportunities come along. The market is still very interesting. We have a good pipeline, and we will remain optimistic. Thank you. The next question comes from the line of Matthew Yates with Bank of America. Please go ahead. Hi, good afternoon, gentlemen. Maybe a couple of questions, please. One for Gilles around the plant protein investments you've been making. I see you've opened these two innovation centers. I'm curious, when you do a project or an investment like this, can you help us scale what the additional revenue upside is? I don't know if you've made any similar investments in the past in other areas or how incremental would you expect this to be to the CHF 100 million or so plant-based revenue you have that's grown very strongly. The second question may be more towards Tom, just coming back to, as Heidi was alluding to margins for next year. I'm guessing just the mechanical margin dilution from the price increases is gonna be 100 basis points plus. There might be a lag effect in fully recovering. Can you help us perhaps more quantitatively, how much are you expecting margins to be down next year? I'll start with plant-based proteins. You know, this is really an interesting area because we were, I would say, the first to really invest. The investment you're talking about, you know, started, let's say, 5 years ago, already in technology, developing solutions, natural ingredients, which would be, you know, helping to make those offerings actually taste good and be not only acceptable by consumers, but loved by consumers. Investments were very much around the innovation. You know, remember we spent 9% of our sales on research and that started a few years ago. The plant-based proteins business has now reached circa CHF 120 million-CHF 130 million of sales. Has been growing strongly, very strongly. We truly open, let's say, a research and application center where we actually develop solutions with our clients, you know, one in Kemptthal in Zurich. Those investments are not, you know, very big because they are already part of the Zurich Innovation Center that we have in Zurich, which we have invested into a while ago. In terms of sales and growth opportunities, as I said, you know, we already are at CHF 130 million. How big can the market of plant-based proteins be? That's a bit the big question. For sure it can be, it can be big, but how big? If I make maybe an analogy, when we invested, we started growing our health and wellness business, which was all about making healthy diet, let's say, food offerings and beverages taste good. We started with innovation, taste solutions, and so forth, well, 15 years ago. We had no idea about how the market, how big the market could be. Remember, those solutions were fully incremental to flavors, because those solutions are actually things which helped modulate the taste, and they were not cannibalizing anything. They're just additive and incremental. This health and wellness business is roughly CHF 560 million of sales today. I would be surprised that the plant-based proteins business could not be, you know, bigger than this in the next coming years. That's what we are looking, but the unknown is all about, you know, how acceptable those solutions can be by consumers. We contribute to that, but we are not the only ones to contribute to that because as you know, we are not, for example, in the protein space, we are just helping. We're just part of the solution, but not of the full solution. Maybe Tom, you answer the thing about the mechanical dilution. Yeah. Thanks, Gilles. You know, Matthew, as we said, you know, over the long- term or over, if you look at what we've done historically, we have fully compensated for raw material increase with price increase. You know, the other thing to bear in mind is that we have a certain churn in our portfolio. Roughly 10%-15% of our portfolio is changing every year. This portfolio, every time we, let's say, have this churn, we have the opportunity to reprice as well. You know, the other thing that I think you really need to look at and think about is we have a very consistent track record on our free cash flow. If you look at what we've done over the last few years, a very consistent 12% or above 12% free cash flow as a percentage of sales. That's part of our long-term guidance as well. The next question comes from the line of Charles Eden with UBS. Please go ahead. Hi, good afternoon. Thanks for taking my questions. The first one, just sticking with pricing, can you just confirm the contribution from pricing in Q4, if there was any? Sorry if you already disclosed that and I missed it. Staying with pricing, are you able to comment on the level of pricing contribution that you expect in 2022, which has already been agreed with customers, and how much if any is still left to be contractually agreed? That's my first question. My second question is just on Fragrance and Beauty. It looks like there was some softness in North America in the Q4. Is that simply a function of the strong double-digit growth comp from Q4 2020, or have you seen some softness in consumer demand in that market sequentially as well? Those are my two questions. Thank you. I'll start the other way around. Basically on North America, the softness that you're seeing has entirely to do with comparables, which were very high in 2020 for Consumer Products. Actually, in 2021, the Consumer Products sales in North America for local and regionals actually was very good. It's really more with the globals that we had some decline, and that was against the very high comparables of growth with globals in North America in 2020. This is all about comparables, no specifics about about softness or anything. North America overall has been fueled by the rebound of Fine Fragrances, obviously, but also by, as you've seen, the very good growth that we have in Taste and Wellbeing. As it relates to pricing, we have essentially no price increase in the Q4. As you know, the raw materials were basically flat over 2021, so there is no reasons or argument to increase prices during 2021. Obviously, as we were seeing, the raw materials, you know, creeping up and increasing as we were negotiating contracts in the Q4 2021, we have already developed plans and approached many clients to basically implement a price increase on both sides, on both divisions. I would say as a difference to, you know, 2011, where in fact the surge was very, very sudden at the end of 2010, we were not that prepared, you know, in 2011 to pass on price increase. That timeline was actually quite, you know, quite big, 3-6 months, if I remember. We've learned from the past, and I can tell you we have improved from that standpoint. The organization is really very much committed to work with our clients and to pass on all those price increases. I can't tell you. I don't want to disclose any of where we stand vis-à-vis the negotiations with our clients. We are making very good progress, and don't forget it comes also in an environment where everything is increasing. That's basically what we can say. We are committed to recover the absolute value in 18 months. I mean, during the 18 months, starting from now, obviously. Super. Thank you for that. The next question comes from the line of Daniel Bürki with Zürcher Kantonalbank. Please go ahead. Hello, good afternoon. I would have two questions. The first one on synergies. You will book another CHF 25 million of integration costs. What will be the timing of the synergies in 2022, 2023? And what synergies to expect, if you could give a number? And then the second one on Latin America, still great growth there, but there was a certain slowdown in the Q4. Do you see anything changing in this growth market for you? I'll start with Latin America, and maybe Tom will... Basically, in Latin America, I must say that that has a lot to do with, again, you know, comparables. We actually had a very strong growth in the Q4 2020, essentially because of the launch of a very big, you know, fragrance being launched in Latin America. So that really made a huge spike in our Q4 2020, especially for fragrance, which created a very high comparable for Q4 2021, especially for the fragrance. Again, no signals as we see of softness in Latin America. Obviously this launch has been rolled over in 2021, but the effect, you know, is now we have the comparable. Essentially no signals. This is really explained by this comparable and this single- launch, which was very big. Daniel, just on the synergies and the integration costs. I mean, as you probably noticed, even in 2021, we had lower integration costs than we had originally communicated to you, simply because, you know, as you've seen as well from our numbers, you know, our facilities were operating at full capacity. It's very difficult on top of that to come with footprint optimization. I think based on where we are today, it's going to be more back-end loaded, both from an integration cost perspective and also from a synergy perspective. You know, hopefully that gives you some details on that. Thank you. The next question comes from the line of James Targett with Berenberg. Please go ahead. Hello, good afternoon. My first question is on the volume outlook for 2022. You did about sort of 6.5% volumes in 2021, and even on a sort of two-year average basis, around sort of 5.5% volume growth for the last two years. I'm just wondering kind of why you're more cautious on 2022, if we're getting back within the guided, the sort of midterm guided range. You've mentioned you're not expecting material price elasticity. Is it just a normalization of volume levels in certain categories as we exit the pandemic, or is there something else we should be thinking about? Then my second question's on back on the inflation, input cost inflation. Could you give us an idea of, you know, how much of the other areas of inflation, like freight and energy, et cetera, could be in 2022 on top of that 9% COGS inflation that you've called out? What kind of visibility do you have in there? Like, what proportion of this inflation is currently hedged or locked in at this stage? Thank you. Yeah. You know, your first comment on the price elasticity, I think I referred already to the first question, might be a bit misquoted on one media, Bloomberg, namely to name it. We're not overly cautious on volume growth. We're just saying that, you know, with inflation, it's a general comment, that with an inflationary environment, price increase and so forth, maybe, you know, volumes might be softened. As we see it, there is no indication of any softness. We still have a high comparable, that's the only thing that we can say, with 7.1%. We are committed to a 4%-5% growth. We are on track, we've just tracked 5.5%. Obviously we'll have the, let's say, material price increase in our sales growth, coming on top of volume growth. We just need to say that there is still some lack of visibility as it relates to the pandemic. On the other hand, you saw that during the pandemic, you know, in 2020, we grew 4%. Second year of pandemic, we grew 7.1%. We should be okay during 2022. Just on the, you know, the other items, I think that if you look, and again, particularly the impact in 2021, most of the items you referred to were impacting actually in 2021. You know, from this point we don't expect any significant more inflation on these items. I think if you look generally at the outlook from many companies around things like freight, transportation, I think they're relatively comfortable with these costs for 2022. It's more really around raw material inflation. Thank you. The next question comes from the line of Georgina Fraser with Goldman Sachs. Please go ahead. Hi, good afternoon. Thank you for taking my question. I've just got one. Around your comments on the Active Beauty success story, can you confirm the very strong growth rates that you saw during 2021 and maybe give some insights into what was driving that? Is it innovation-led new markets or market share gains? Thanks. Active Beauty, we grew in the range of a high double-digit growth. As I said, we achieved, I think, close to CHF 130 million. This is very much, I would say, combination of a few things. The first thing is that over the last six, seven years, we have made, let's say, three main acquisitions, Soliance, Induchem, Naturex, and then a couple of others, minimal, which over time allowed us actually to have a very rich and diversified portfolio. The second thing is that we have been able to invest into capacity, but also into innovation, to be able to, you know, to service a market which has been growing and you know with a reasonable offering around the world. The third thing is that let's say the adjacency to our fragrance business where our clients are the same, you know, helps very much in the way we interact with clients and we can leverage the clients' relationship that we have on the fragrance side. Combined with the discipline of Givaudan to make the business growing sustainable and profitable, I would say that's been a bit the formulation of the formula of success for Active Beauty. We are really happy with this business. As I said, you know, if we find further acquisitions, you know, companies to be acquired which would complement this portfolio, that would be even better. Okay, that's great. Just to confirm, those sounded like some quite sustainable trends that you were describing. To think that those growth rates will continue into 2022, or was there anything in a kind of unsustainable nature during 2021? To mention, you know, obviously don't forget on skincare activity, the end markets are also doing very well. You know, that's been. Our growth has been supported by the end markets, obviously. I would say this whole Active Beauty business reflects, you know, this whole trend that you're referring to around wellness, around wellbeing, which is also translated on the Taste and Wellbeing business where, for example, immunity products that we have seen growing very much in the US, especially in 2020 and 2021, is also supported by a high demand and the offering that we have around that. Everything around health, wellbeing, outside and inside are really supporting those segments. Now we'll take the last question, operator. We'll take the last question. The last question for today comes from the line of Charlie Bentley with Jefferies. Please go ahead. Brilliant. Thanks for taking my question. So I just wanted to ask on the raw material outlook, can you just explain what the 9% is based on? I mean, I know you have a lot of visibility on inventories. Are you assuming that pricing is flat or down from there? Have you baked in any downside? How much confidence do you have in that number? And then secondly, just on volumes, I mean, as you've alluded to, you've had a couple of very strong volume driven the last two years. I mean, what's your ambition on in 2022? Is kinda 2% a good result? Is flat a good result? How would you see it? Thank you. Essentially, you know, on the raw materials, again, we iterate, we buy a multitude of them, 12,000 of them, which end up in very different applications as you know, because now with fragrance, flavors, the adjacent spaces, their usage is very different. Their nature is also very different. You have natural products, highly specialized natural products, jasmine, rose, mimosa, as much as large commodities going from orange, citrus and so forth. But then you have also chemically derived fragrance raw materials coming from which are being influenced, of course, by energy and the crude oil, you know, which are even we are if we are very at a multiple stage away from the crude oil, the price of oil is still influencing those products. You have many categories which behave in many different ways. The fact is that still, even though all those categories have very different natures and behaviors, they all are going up essentially because of the demand. The demand which is around the world, which has been fueled by the rebound that we have seen in 2021, not only for Givaudan but the whole industry, our clients, our competitors and so forth. There's been a surge in the demand, which is putting pressure on those prices for this year. In terms of the way we approach purchasing, depending on the nature of those products, you have sometimes products which are bought on a spot basis because those are commodities. You have others which where you have long-term contracts, others which are only one crop a year. The timing of those contracts are very different. The tactics and strategies are very different. Basically we try to cover as much as possible, but at the same time, not too low in certain categories because if some of those categories go down, for example, you know, in a few months, we don't want to be caught also with high prices. This is basically the whole complexity. We have a 9% guidance for this year. This is the best of our knowledge. We have good confidence that this is the contracts in place, you know, will basically allow us to have all those raw materials available. Because the priority, don't forget, is also to be able to service our clients and so that we can have a seamless supply chain to them so that they can sell their products, you know. A product with a missing fragrance and a missing flavor doesn't taste or doesn't look good. Our priority is to service our clients. That's the best that we can say. We are committed again to recover the absolute amount of those raw materials increase. Okay. That was the last question. I'd like to thank you for all your questions and we look forward to our virtual annual investors conference on the twelfth of April as we publish our Q1 2022 sales. Thank you very much. Have a good afternoon.