Good morning. Welcome to the Analyst and Investor Conference Call of Holcim's First Quarter 2026 Trading Update. My name is Bernd Pomrehn, and I'm joined today by our CEO, Miljan Gutovic, and our CFO, Steffen Kindler, to present our financial results. Following the presentation, we will open the floor for questions. Anyone who wishes to ask a question may press star one on the telephone. You will hear a tone to confirm that you have entered the queue. If you want to remove yourself from the queue, you may press star two. Webcast viewers might submit their questions in writing via the dedicated field on the screen. In the interest of time, please limit yourself to two questions. Now I'm happy to hand it over to you, Miljan. Thank you, Bernd. Good morning to you all and warm welcome to Holcim's 2026 First Quarter Trading Update Conference. Steffen and I are pleased to be presenting our numbers to you today, and we look forward to taking your questions afterwards. As you have seen, we have delivered a strong start to the year. There was a robust organic growth in net sales of nearly 4%, driven by leading positions in the highly attractive markets where we operate. The 8.3% organic growth in our recurring EBIT was even stronger, and this was driven by our premium and sustainable offering, our strict cost discipline, and our operational excellence. With our resilient and proven business model across all economic cycles and market conditions, after this strong start to the year, we are confirming our 2026 guidance, which includes a further increase of our industry-leading margins versus 2025. Turning to the regional highlights now. As you can see, in Europe, there was a sales acceleration in March and price over cost was positive, partially offsetting the impact of weather on the margin. Our use of alternative fuels increased to 70% in the region during the quarter, future-proofing Holcim from energy price exposure and market volatility. You will hear more on this topic from Steffen later. In terms of the outlook, we expect strong activity in infrastructure across the whole region and in residential, a recent increase in building permits is expected to continue in several countries. In LATAM, we delivered 7.6% organic growth in net sales, driven by Mexico, Central America and Ecuador, with a recurring EBIT margin above 30%. We completed one large acquisition and also signed another, and we will talk more on these later on. For the outlook, we expect that the Mexican government's plans for 1.8 million new homes and infrastructure projects to accelerate the growth in this key market for us, and in Central America, there will be ongoing high demand for housing and infrastructure. Our performance in Asia, Middle East and Africa clearly demonstrates that our strategy is able to achieve strong, profitable growth across all market conditions and economic cycles. The region delivered organic growth in recurring EBIT of 26%, while the margin rose 100 basis points to 22%. We saw strong demand trends in North Africa and Australia and expect this to continue for the full year, driven mainly by the residential and infrastructure sectors in North Africa and infrastructure projects in Australia. With that, I would like to hand it over to Steffen to talk through the financials in more detail. Steffen? Thank you, Miljan, and a warm welcome to all of you from my side as well. Always a pleasure to be here with you. Now for our Q1 trading update. Turning first to the net sales bridge, you can see that we had robust organic growth of 3.9%, representing CHF 136 million. Total sales was affected by a negative CHF 104 million impact, mainly coming from scope following the divestment of our Nigeria business, Karbala cement manufacturing in Iraq and other divestments completed in 2025. Also, the FX effect created a translation effect of 5.6% as a mixture of mature and emerging markets currency devaluation versus the Swiss franc. Recurring EBIT, we delivered 8.3% organic growth. There were FX translation effects of CHF 26 million, or 5.5%, and CHF 63 million from divestments, as mentioned already in the sales chart. EBIT growth was driven by strong commercial execution, operational excellence, and disciplined cost management, both in the countries and at corporate level. Once again, we delivered positive price over costs. As you know, increasing our usage of alternative fuels is one of ways that sustainability drives profitable growth at Holcim, increasing our margin and reducing CO2. What may be less appreciated at that point is that it also future-proofs Holcim from energy price volatility. We are reducing fuel and costs through operational excellence in manufacturing while decarbonizing our electricity consumption. As you can see, in the last three years, increasing our alternative fuel usage by 11 percentage points came with a three percentage point decrease in our energy cost. That's fuel and electricity cost as a percentage of net sales. By the year 2030, we will have scaled up this use of alternative fuels to 50% globally and 90% in Europe. Already today, almost half of our cement plants in Europe operate between 80% and 100% alternative fuels. Next, let's look at the progression of our Q1 recurring EBIT and recurring EBIT margin on a rolling 12-month basis. At this time of the year, we usually show this number as a 12-month rolling because the first quarter is by far the smallest in terms of business size, so we put it into a better context. This graph shows our continuing margin expansion. The group margin for the first quarter was down year-over-year slightly, mainly due to the divestments that I explained before. As Miljan has said, we are committed to further margin expansion to the full year 2026. Now let's quickly look at the regional performance. Organic growth in net sales was strong in each of LATAM and EMEA. In Europe, there was significant acceleration in March. Asia, Middle East, and Africa, there was double-digit organic growth in recurring EBIT at 26% with 100 basis point increase in margin, while we maintained a recurring EBIT margin of above 30% in Latin America. In Europe, the margin was impacted by weather. As mentioned before, good cost development on the corporate level continued. With that, I am pleased to hand it back over to Miljan. Thank you, Steffen. For the NextGen Growth 2030, we are indeed delivering a superior performance and margin expansion focused on the five key drivers. As you can see from this slide, we are scaling up our sustainable offering powered by our premium brands. We are accelerating initiatives for decarbonization and circular construction, which is driving profitable growth. A key part of our NextGen Growth 2030 is expanding our high-value building solutions. With our impeccable track record of value-accretive M&A, we are focusing on the most attractive markets and also the most attractive segments, and all of this is driven by our deeply embedded performance culture. Let's look now more closely at some of these drivers. Firstly, customer demand for our premium brands, ECOPact and ECOPlanet, continues to grow. These are being used on the scale in large projects like the one you see on this slide in Argentina, which was built with ECOPact to help address the estimated 1.5 million housing gap in the country. This is a really exciting project with over a few hundred apartments and office space designed for sustainable urban living. Another example is this bridge in Bordeaux in France, which was built using ECOPlanet. It's a long bridge of 550 m, and it was built with 4,000 tons of ECOPlanet with 50% lower carbon footprint relative to traditional cement. We are also seeing a strong growth in ECOCycle, our circular technology that is being used to recycle construction demolition materials and put it back into our products. A recent project completed using ECOCycle was this housing project in France, where ECOCycle was used to rebuild 90 social housing units. Holcim is looking to address this housing gap here as France aims to build additional two million homes by 2030. Very pleased to report that last month we completed the acquisition of Pacasmayo in Peru, which is a milestone in Holcim's Latin America expansion, bringing a very complementary portfolio of building materials and solutions in Peru. The company is a leading player in Peru, and with this acquisition, we are also reinforcing our ready-mix precast and roofing offering in Latin America. I was in Peru myself, and I can tell you it's a highly attractive market for construction material. It has excellent long-term economic growth prospects and increasing demand for higher quality housing, both new and renovated, as well as for infrastructure and industry. Peru's national infrastructure gap, which is estimated to be around $100 billion. As a result of that, government has approved what they call a national infrastructure plan, to prioritize more than 70 strategic projects to be completed by 2031. As you can see on this first slide of this presentation, Holcim Peru played a key role in the construction of the new international airport in Lima, and we continue to support ongoing work associated with this expansion. We are also involved in some of the biggest projects in Peru, especially in Lima, the metro expansion and the highways, which is connecting the capital from east to west. Now, more on M&A. Well, pleased to say that we closed five transactions in Q1, of which four were acquisition and one was divestment. We strengthened building materials by making acquisition in Romania as well as I mentioned Pacasmayo in Peru. We also completed two acquisitions in building solutions, one in Belgium and one in New Zealand. We have divested our operation in Lebanon at the same time. We announced that in March we signed an agreement to acquire a building materials and solutions operations in Colombia from Cemex that represent projected 2026 net sales of around $360 million. This transaction is subject to customary conditions, and we expect closing around the end of the year. One slide on artificial intelligence. Well, it's known that artificial intelligence is unlocking incremental value and growth for Holcim, improving performance and driving customer-centric services. Holcim will deliver benefits from AI of around CHF 200 million by 2028, reflecting both cost savings and cost avoidance. To achieve this, we will make growth investments of around $20 million per year, where we will be focusing on the four key areas, production, logistics, commercial, and administration. By investing in a large network of integrated sensor and data lakes, we are future-proofing Holcim today to unlock great value tomorrow. Currently, there are 38 large-scale AI initiatives which we are deploying across business. From our M-Predict intelligence for optimizing production processes and equipment performance, to our Foresight tool that optimizes our transport fleet and network utilization. With HOLCIM+, which is our AI-powered, always-on platform, we can offer customers a 24/7 service with real-time tracking and demand forecasting that will only become more attractive as we add to it over the time. Meanwhile, our AI-powered internal career hub tool matches Holcim's people with business opportunities to create the value and also to nurture talents. With this, happy to say that we are confirming our 2026 full-year guidance after a strong start to the year. Net sales and recurring EBIT growth fully in line with our NextGen Growth 2030 targets. As you can see from the slides, organic net sales growth 3%-5% and organic recurring EBIT growth 8%-10%. We are also committing to an increase of our recurring EBIT margin and free cash flow before leases of around $2 billion. We will continue to invest in recycling of construction and demolition materials with another 20% growth in 2026. Just to wrap it up, Holcim remains a highly compelling investment. It is important to remind you why. Today, Holcim is a leader in the most attractive markets with a leading sustainable offering for our customers. This enables us to capture the tailwinds from a powerful megatrend shaping the future of construction, such as population growth and urbanization to energy efficient refurbishment and digitalization. We are unlocking significant growth opportunities across geographies and also in our building solutions segment, which will enable us to achieve above market growth. Our talented people and our performance culture will continue to deliver a superior financial performance and value creation. All of this will allow Holcim to continue driving shareholders value through broad focused capital allocation and of course, attractive cash returns. Bernd, you can now open it up to questions. Perfect. Thank you, Miljan and Steffen. With this, we can open up the line for questions. We will take now the first question from Julian Radlinger from UBS. Good morning, Julian. Hey, good morning, guys. Thanks very much, Steffen and Miljan. A couple questions. Firstly, regarding pricing. In Europe, pricing increased, I think something around 3% in Q1, but that didn't include price increases in all countries yet, and it didn't include much of the surcharges yet that you've implemented. I also think the base for pricing is actually going to get easier in Q2. What does that mean for the kind of price growth that we should expect in Europe in Q2 and H2? Then the Middle East conflict aside, would you expect to see any kind of demand impact in any regions or end markets on the back of that kind of pricing? Any pushback or stomach ache from any of your customers in light of such strong price increases? That's my first question. Secondly, in Latin America, you had flat organic EBIT growth, despite very strong pricing in Mexico, I think, and not terrible volume trends across countries. Could you please dissect for us what drove organic EBIT growth down to flat in the quarter? I assume integration costs may have played a role, and maybe some price cost issues due to fuel costs and so on. How should we think about that in the next few quarters? Can we think about year-on-year growing EBIT margins again in due course in LATAM? Thank you very much. Good morning, Julian. Thank you for your question. I'll start, and then I'll ask Steffen to add as we go. I'll start with the pricing. Yes, Julian, you're correct. Pricing has not been completed in Germany and another one or two markets. We expect this to be finalized in April. Overall, I can confirm that we are seeing a very healthy pricing dynamic in Europe across all our regions. At the moment we are within our expectations which we communicated earlier around mid-single digit. Outside Europe, situation is pretty much similar. We have some markets where we are slightly above expectations, like in Mexico. All in all, across all our key markets, pricing dynamic I can confirm is very healthy. Regarding the Middle East conflict and how it is impacting the market momentum, exception is GCC countries where we have relatively small operations, represents less than 1.5% of the net sales. We put priority on the safety and well-being of our employees and their families. We did stop operations for a couple of weeks. Last few weeks we have resumed. Other than that, I am not expecting any change in the construction market momentum as a result of the Middle East conflict. Far, we are seeing a healthy pipeline of projects in Europe. Same applies in North Africa, and I did give the outlook for Mexico, Central America and Ecuador. On the LATAM, I'll start and then Steffen can add. First of all, just to address Mexico. H1 last year was slow. We saw momentum gaining in Q3. We reported some infrastructure projects that we have secured, and we have seen similar trend this year in Q1. We have secured a few of the big projects in Q1, end of the last year Q1, which is Guadalajara Airport and Salina Cruz Refinery, where we are already supplying our ECOPact, ECOPlanet solutions. Our focus in Q1 in Mexico was on the pricing, and I am very happy to report that pricing dynamically, what we achieved actually outcome was slightly above expectation. For us, maintain the pricing, maintain the market share, continue with expanding the sense our retail outlook. Just one fact that we have not communicated before. Holcim Mexico's EBITDA margin currently in Q1 was around 44%. This is a very healthy level and we want to maintain this. On the margin impact, I'll just mention scope and some maintenance, extended maintenance shutdown in Argentina. Steffen, why don't you say? Yeah, thanks, Miljan. Look. Morning, Julian. Also from my side. Miljan basically gave the complete answer. The margin or the EBIT growth impact in Latin America was from scope predominantly Guatemala and Peru. The onboarding of our acquisitions and the entry into new countries Argentina, we had some extended maintenance shutdowns. That was an operational issue that hit us in Q1, will have a bit of a lingering effect into Q2. What is important for us, the story for LATAM remains super positive. The strong price increase that Miljan just described, the good momentum across markets. We just talked about Mexico with a very high EBIT and EBITDA margin. Organic growth will be mid to high single digits for the full year margin, above 30%. Remember, there is a massive amount of scope coming in the second half of almost CHF 400 million with the acquisitions that we're doing. There is a very positive outlook for Latin America going forward, especially into the second half. Thank you very much, guys. Perfect. Thank you, Julian. The next question comes from Ben Rada Martin from Goldman Sachs. Good morning, Ben. Excellent. Good morning, Miljan, Steffen, and Bernd. Thanks for the questions today. My first question was another one on pricing, interested particularly in the pricing actions you've had to make post the conflict and the inflation that you're seeing. What kind of magnitude, I guess, do you expect to be additional to your original February expectations for pricing for 2026? The second one would just be on 2026 guidance. We're a few months into the year now, obviously some moving parts in terms of cost and pricing, but I'd be interested from your side, what do you think are the key swing variables that get you to the top end or the bottom end of the range? Is it more related to volumes or are there also things in price costs that you think are still up for debate? Good morning, Ben. Thank you for your question. I'll start with the pricing. Look, nothing to add, actually. We have achieved what we aimed at. We could see some movements on logistics cost as a result of the diesel prices, but we are confident we can cover that through surcharges and pass it to the customers. I'm not expecting any significant impact as a result of this Middle East conflict. What I would like to reinforce is that we do get many questions on energy. This is what Steffen already addressed in the presentation. Really, all the hard work that we did in the last couple of years, where we have invested to phase out traditional fossil fuels from our business and replace it with alternative fuels is now paying off. You see that we are close to 40% usage of alternative fuels globally and in Europe, which is where we are seeing the biggest impact on energy prices, we are up to 70%. All these investments are now paying off, and we will continue to invest in these initiatives with the aim to reach 90% of alternative fuel usage in 2030 in Europe and 50% globally. On the guidance, I think you hinted at, if geopolitical situation stabilizes, we could see a significant upside on the guidance that we provided because the whole construction momentum will accelerate. Perfect. Thank you so much. Thank you, Ben. The next question comes from the line of Luis Prieto from Kepler Cheuvreux. Good morning, Luis. Good morning, everyone. Thanks a lot for taking my questions this morning. I had a couple of questions. The first one is if you would be able to break down the organic growth building block of your Q1 recurring EBIT to its between price over cost and volume, at least a rough idea. The second one is with regards to you having committed significant resources to acquisitions over the last month, Xella and Pacasmayo. Does this imply that we should expect you to take some time to digest these businesses? Or you believe you have ample integration capabilities to do something sizable on the M&A front in the remainder of 2024? Thank you. Good morning, Luis. Thank you for the questions. I will start with M&A, and then I'll hand it over to Steffen to break down organic growth. On M&A front, yes, Luis, you're right. We just closed Pacasmayo. We are planning to close, subject to conditions, Xella end of Q2 and Q3, and the plan is to close Colombia acquisition end of the year. All of this will take time and energy to integrate these businesses. Keep in mind, we are fully decentralized business. This is the power of our model, where local people take the ownership of the whole integration and achieving synergies. I'm not excluding that you will not see some additional big deals signed from us this year, but this year, I would like to focus more on integration of these companies and continue with the strong momentum on bolt-on side. We have closed a few, three bolt-on acquisitions already in Q1, and I can confirm that we have a very healthy pipeline for the rest of the year. Steffen? Yeah. For your question, how to break down the Q1 EBIT. Look, as I said, price over cost is positive. That is composed of a positive price of, let's say, mid-single-digit%. Then we have a bit lower energy still in Q1. Q1 still has energy tailwinds, and we have a slight non-energy inflation of, let's say, around 3%, which is distribution, raw material, structural cost, and fixed cost. Here's your breakdown. Volume, of course, had a negative impact on price over cost on the EBIT development in the first quarter. Price over cost positive, volume negative. That puts it together. Super clear. Thank you very much. Thank you, Luis. The next question comes from Jon Bell from Deutsche Bank. He sent us his email. Do you think any of the strength seen in Europe in March was due to pre-buying by those keen to avoid price rises? Did you see the positive demand trend continue in the first three weeks of April? Thank you for the question, Jon. I would not say March was about pre-buying. Yes, we've had some upside because January and February in Europe, as you know, have been greatly impacted by weather conditions. That's lifted the momentum in March. I would like to confirm that April is looking solid so far. Perfect. Thank you, Miljan. The next question comes from Pujarini Ghosh from Bernstein. Good morning, Pujarini. Hi, and thanks for taking my questions. On the EBIT margin guidance, you have mentioned that you are expecting to see a continued margin expansion. Could you provide some more color about how we should think about the different regions in terms of the EBIT margin expansion, given what you've already seen in Q1? My second question is on M&A again. You've already announced some very big acquisitions as well as completed four bolt-ons this quarter, with a couple of quite sizable bolt-ons in LATAM. How is the pipeline looking? How are transaction multiples developing? Is there any impact of the war making it either easier or more difficult to do the acquisitions? How are you seeing the synergies develop? Finally, for the Latin American business, how does this impact the growth and the excellent margins going forward? Thank you for questions, Pujarini. I'll start, and then maybe Steffen can add on the M&A. I'll start with M&A. Look, I think so far so good. Momentum is strong. Europe, we have very exciting projects in the pipeline, companies that specialize in recycling of construction and demolition materials. We do have few interesting targets in aggregates, where we have over proportional EBITs in Europe. I'm not seeing any negative impact. It's not getting more difficult to do acquisition as a result of conflict in the Middle East. On the EBIT guidance, I think Steffen can add a few things. Hi, Pujarini. Good morning. For your regional understanding, let's start with EMEA. You saw a very nice margin growth in Q1. We explained the reasons for that. That story is going to continue throughout the year. We see a good margin progression here. Europe will turn positive in margin development. You know that we talked about the impact of the weather in January, February, good recovery in March. Miljan just hinted to a solid outlook into April. That will also help us to come back with margin growth here. Also, I said before that the margin overall was impacted due to the effect of incoming acquisitions. That will also wear out throughout the year. Lastly, Latin America. Here we always say we want to be above 30%. Latin America margin is so high, so it can vary between one year to the other. What is important here is that we drive growth in Latin America, sales growth, and that we get more of this very high margin into our numbers in terms of a mix effect. I think this is the way to think about it. Something we've also said repeatedly, that the contribution from the right sizing of our corporate structure will probably also add on a full year basis, right around half a percentage point. That gives you the algorithm. Good. Thank you. Perfect. Thank you, Puja. The next one on the line is Elodie Rall from JP Morgan. Good morning, Elodie. Hi, good morning. Thanks for taking my questions. I had one on AI, and it sounds a bit like probably not a new initiative, but it's the first time you spend the most time giving us more color there, so it seems like the focus is increasing. Is it fair to say that this AI initiative was not embedded in your Capital Market Day guidance last year, and this could be source of upside to your midterm targets? Then I had a clarification question or point if you want. On those fuel surcharges that you're passing through, and particularly on transportation costs, these are passed through. Should we expect that you give these back, i.e., pricing down, should transportation costs come down with the oil price move at some point? Thank you. Good morning, Elodie. Thank you for the questions. I'll start on AI. Yes, this was not embedded in our Capital Market Day. This is upside. Yes, you are right, Elodie, this is not new. We have been deploying these initiatives for the past few years, and this morning we are committing to a number that could be exceeded if everything goes according to plan. CHF 200 million in cost savings and cost avoidance by 2028, and if you can see here from this chart, most of it will come from production where we have already deployed our key initiatives, and it's all about scaling. I am counting also that on logistics commercial side, we can see significant upsides in the years to come. To do all of this, obviously, we need to spend some money. Yes, as you can see, we are committing to investments of approximately CHF 20 million per year in order to accelerate AI adoption. Regarding the logistics COGS surcharges, this could go up and down depending on the fuel prices. What I said earlier, we do have ability to pass this on to the customers, and this is the protection we had in place for a number of years now. Thank you. If I can just follow up on these cost savings from AI. Can you give us a bit of color on the phasing of the realization of those cost savings? Oh, look, 200 is 2028. I would like to see next year 100 + possible. Yeah, we will see 100 + next year, 200 by 2028. Great. Thanks very much. Perfect. Thank you, Elodie. The next one on the line is Cedar Ekblom from Morgan Stanley. Good morning, Cedar. Good morning. Thanks very much for the questions. Can you talk a little bit more about your purchasing structures in place for energy, that which is not alternative fuels, just to get a bit of understanding of when we should think about higher spot prices actually flowing through your costs? And then following or linked to that, just like to push you a little bit on your point that the sort of top end of the guidance requires geopolitical stability. If I think about your moving parts versus where you were when you provided that guidance, I would argue that the pricing backdrop is better. Obviously, there is some cost risk, but you do stress the points around alternative fuels and recycling and hedging, et cetera. I do wonder how long it takes for these costs and how meaningful these costs are actually when they come through. I mean, it doesn't sound like you're really talking down the volume backdrop. When I put those moving parts together, it feels like actually the backdrop's better than it was when you provided the guidance, strangely enough, but you're not sort of lifting your ambition. I'd just like to hear what incremental risk factors have come into the business. You're not talking down volumes, right? You sound pretty good on volumes. I'd just like to understand why the guidance upgrade is not there. Thank you. Good morning, Cedar. Thank you for the question. I'll start with the guidance, and then I'll hand it over to Steffen to talk more about purchasing spend when it comes to energy. Cedar, geopolitical risk can create tension in the system that could slow down investments in the residential, investments in infrastructure and so on. Early Q1, it's just the first quarter, it's the smallest quarter in the year, so we are a little bit cautious. March, what we saw in Europe, for instance, was excellent momentum. April is solid. On the volume side, on the whole marketing activity, I would say that I'm not expecting any significant changes since Capital Market Day. Hard to predict what can happen in the H2 if the conflict in Middle East prolongs. On the LATAM side, yes, you're right, probably there is a slight upside. What I personally witnessed during my last trip is that momentum is slightly better than we initially thought, and then the whole EMEA should be okay with some potential risk as a result of the Middle East conflict. I still maintain that the biggest concern today we have is this whole geopolitical situation, depending how it translates, if it continues for a longer period of time. For energy. Hi, Cedar. Good morning. Look, we said previously that close to 80% of our energy requirements are secured for the rest of the year. How to understand that? In regulated markets, which are about 35%, we have contracts in place, so this is done. Then from the hedgeable portion, which is about 60% of our requirement, 70% is hedged. There you go. This gives you altogether a secured piece of almost 80%. What I would also say is for the remaining piece, we have plans in place. We have cost actions in place. We have commercial actions in place. It's always important also that our management stays sharp on this topic so that we can stay nimble. For the balance of this year, we feel quite confident that we can deal with further pressures on the markets quite well. Perfect. Thank you very much. Thank you, Cedar. The next one in the line is Arnaud Lehmann from Bank of America. Good morning, Arnaud. Good morning, team. Thank you for taking my questions. Two on my side, please. Firstly, coming back on the EMEA region, could you give us an indication of the contribution from Huaxin in China? Within that, was there a meaningful impact from Nigeria? That's my first question. The second question, I appreciate AI is more fashionable than carbon capture at the moment, but I think there are discussions around launching a large-scale carbon capture project in Europe, possibly in Belgium. Is it something that you're still working towards, and could you make an announcement this year? Thank you. Good morning, Arnaud, and thank you for your question. I'm equally excited about carbon capture as we are about AI. You are referring to our GO4ZERO project in Belgium, Obourg. You saw probably recently we did sign the agreement with Air Liquide for phase two. Currently, priority is to finish phase one, which includes a brand new, industrial brand new cement plant, which will indeed be state of the art with very high usage of alternative fuels, alternative raw materials, and the most efficient production processes. Nothing has changed. We are committing to commissioning in Q1. Recently, I have also visited the project. It is going according to plan. Once we have completed commissioning of phase one, then we will start working on phase two, working with our partners, as I mentioned, Air Liquide on capturing, but we also have a partnership with another companies when it comes to logistics, transporting CO2, and also storing CO2. Commissioning Q1 2027, and that means completing phase one of the project. Steffen, why don't you comment on EMEA and Huaxin contribution? Yeah. Hi, good morning, Arnaud. Look, it's a bit difficult to comment on Huaxin because it's a listed company, so I have to be very careful what I say. I cannot really comment on their results so much. What I can tell you is the JV contribution was positive. We had a positive OG contribution this year so far in our EBIT, mainly due to good developments in Australia and Huaxin. The good demand in Australia we talked about before. We saw good resurgence here with good volume growth. The strong development in Huaxin is driven by their overseas business. It's not driven by their domestic business, it's driven by their overseas business. I'm not telling you something that the company wouldn't say itself. This is public. When I tell you that, then you can probably deduce that their investment in Nigeria was potentially not detrimental. Maybe we leave it there. The outlook for our joint venture business is quite positive for this year. We expect a strong contribution from all our three large JVs. Thank you very much. Thank you, Arnaud. The next one on the line is Martin Hüsler from ZKB. Good morning, Martin. Good morning, everyone. Thank you. I have a short question first on the AI investments. I was just making sure that this is all OpEx, CHF 20 million, or is part of it CapEx? Good morning, Martin. Thank you for your question. It includes both OpEx and CapEx. Maybe 50/50 split, or what is the best assumption here? Approximately 50/50. Okay. Thanks a lot. Then I have a second question. With the annual results, Steffen gave us a certain outlook, what he expects in terms of FX for the full year and cons and deconsolidations. I was just wondering whether those numbers are still valid or if something has changed there. It looks up. Currently, we see in the first quarter, we see an FX headwind of 5%-5.5%. We don't usually guide for FX, but if you need a guidance, I would go with current spot rates. Current spot rates, I think are on sales a bit above 3% and on EBIT a bit above 4%. That's your best guess, I would say, at the moment. In terms of scope, you were mentioning something like Scope 1 120-150 and divestments roughly -40. Is this still ballpark? Yes. I would think you should stay with that. Yep. Okay. Thanks a lot. [Non-English content] Martin. Maybe let's stay at the AI topic. We received two questions from Paul Roger from BNP Paribas. His first question is, "How unique are your AI initiatives, and are they only being deployed internally? Would they be monetized with third parties? Hey, good morning, Paul. Look, the way we do AI is really the ideas and the concepts are driven by our people in the operations, in production, logistics, commercial, and also admin. That's where the ideas come from. This is paired with technical and data knowhow and from our IT team, and a third pair is external expertise. What I would say is these initiatives are highly unique because they're based on our data platform. Super important for the deployment of AI is that you have harmonious data that's consistent over time and over regions so that you can scale it. This is why it's very proprietary, and it's also based on the knowledge of our people. The underlying models that we use with external help, they may be standard, but then again, the algorithms are custom trained on Holcim-specific material. For the time being, I would think this is highly specific to us and our situation, and it's based on, A, our data, and B, the knowhow of our people and paired with external expertise. Therefore, we would think this is very Holcim specific. Perfect. Paul had another question on AI. He's asking, "Are the AI skills to develop these initiatives available internally, or is Holcim using consultants or attracting new talents? And what makes the group an employee of choice for digitally minded experts? In short, the answer is we are building AI capabilities mainly internally. However, we do complement this by selective hiring and selective partnerships with third parties. What's making us different is the way we approach this. This is a part of our Holcim University where we are preparing our people for the future. We are upscaling them. We are training them, and AI is part of these initiatives. When it comes to AI, I would maybe just to mention that we have two key initiatives. One is AI Academy, where we have a dedicated programs for our managers to really master AI leadership and also strategy. And then we have functional AI modules, where we are targeting training built into every department, procurement, finance, logistics, and so on. Perfect. Thank you so much, Miljan. We received another written question from Anthony Codling from RBC. He's asking, "Can you please comment on CBAM, your thoughts about possible changes to ETS and your expectations for the new benchmark, timing, benchmark price, et cetera? Do you see these as headwinds, tailwinds, or no wind? Anthony, I can just comment on the rumors. What we heard is that the benchmark is around 657 kg. This is 5.5% below phase four, below the previous benchmark. I'll just say this is in line with our expectations, and we are okay with this outcome. Hopefully by September, European Commission will confirm and make it official. In our view, this does not change anything regarding CBAM. We welcome CBAM. We are happy that it's been finally implemented, and now it's all about verification and auditing when it comes to CBAM. Thanks, Miljan. The next one on the line is Ephrem Ravi from Citi. Good morning, Ephrem. Morning. Thanks for taking my question. Two, most of it has been answered frankly, but would like two clarifications really. Firstly, disaggregating the Latin American business into Mexico and rest of LATAM. The context of the question is I think Cemex reported Mexico up double-digit percentage revenue in local currency, and if you had similar growth in Mexico, and LATAM is up 7% organic, Mexico is roughly half of LATAM. It indicates a slightly soft rest of LATAM. You did mention the Argentina issues, but would it be kind of fair to say that rest of the LATAM was significantly softer on a top-line basis compared to Mexico? Secondly, again, on the fashionable topic of AI. You're going to spend $20 million per year on AI and expect $200 million of recurring EBIT. That implies an ROI of close to 200% if you take the three years cumulatively and phase it. If you can stand by these numbers, then what is the limiting factor in accelerating these investments even more as it could be possibly the best ROI you could gain in this business? Thank you. Ephrem, thank you for your question. I'll start on LATAM. I think I answered it pretty much earlier, and Steffen also had few points. Just to summarize it, Mexico, we are expecting strong momentum in 2026. We are positive about the whole market, and this is based on the project pipeline currently we see. On Mexico and our financial performance, I would maybe mention one more time, our EBITDA margin in Mexico is 44%, and this is where we want to maintain. We want to keep investing in the sector. We want to keep expanding and growing our business over proportionally. For the whole LATAM, this year we have a strong price increase. We will maintain EBIT margins above 30%, and we will have a positive scope effect of nearly CHF 400 million from Pacasmayo. Steffen, would you like to add? For ROI, look, what we gave you here, the CHF 200 million, is based on our current 38 initiatives. 38 is a large number already, and we're putting a lot of power behind that. There's no limitation to doing more. If we come back in a year from now, Miljan and I work on 50 initiatives, then of course the benefit will be higher. It's the number of ideas we can generate internally and the number of projects we can generate internally. 38 is what we're working on right now. It doesn't have to be like that forever. There's potentially upside on that as well. This is where we are today. No limitation. Thank you. Thank you so much on that. The next one on the line is Yassine Touahri from On Field. Good morning, Yassine. Good morning. Thank you very much for taking my question, sir. Two questions. Last week, I think President von der Leyen in Europe commented on boosting the Market Stability Reserve as part of the ETS review in July. Do you have any updated view from discussions with the European Cement Association or Brussels on where the EU ETS price could go medium-term? I think the question is, what CO2 price do you currently assume for the decarbonization investment? What level will either accelerate or delay your carbon capture project? Second question on Latin America. I think you have a couple of press reports that have been confirmed by Chinese cement companies that suggest that large Chinese players are considering acquiring one or two cement companies that are currently for sale in Brazil. This could mark the first meaningful entry of Chinese player into Latin American cement. The question is, would this have any implication for your long-term regional strategy, or do you see this potential move as Brazil specific and therefore it's not directly relevant for your portfolio because you exited the country? Good morning, Yassine. Thank you for the questions. I'll start with ETS and CO2 price. We are still using EUR 120 and EUR 150 per tonne as indicative price when we do these business cases for carbon capture projects. Yassine, please remember that we are working on de-risking these projects. One option is what we saw in Germany is this CCfD, carbon contract for difference. We need to have a backup option in order to de-risk the projects and to ensure that being a first mover, we will not be punished in the long term. Regarding LATAM and Chinese, yes, there is a reason why we exited Brazil. For someone to enter some of the countries where we have a dominating position, extremely hard. Extremely hard. I would not say impossible, but very hard because markets are consolidated, reserves have been secured. For someone to enter and build a cement plant from scratch, I do not see it. Thank you, Miljan. Okay. Thank you so much, Yassine. The next one in the line is Harry Goad from Berenberg. Good morning, Harry. Yeah. Hi, good morning. Thanks for taking my questions. Can you talk a little bit around what you're seeing in Germany, please, and whether we're beginning to see any of the benefits come through from the stimulus program? I guess more generally, I know you don't like giving sort of individual country numbers, but can you give us a feel for what you're seeing in cement volumes across big markets in Europe like U.K., France, Germany? Thank you. Good morning, Harry, and thank you for the question. Regarding the German infrastructure spend, we are not budgeting anything for H1. We might see something in H2, but in H1, I would not put any numbers for H1. Regarding the whole market momentum, we do not comment basically per country. Just to give you a few regions, we see are strong, Eastern Europe will continue to be strong. Probably Germany and France, we have started seeing some positive momentum in residential. Southern countries in Europe, Spain is strong, Greece is strong, and our whole market, I think, in my view, Switzerland this year will be very, very strong. We have already secured some of the big projects last year, and we have secured two more this year, so I expect Switzerland also to have a strong year. U.K., hard to say at the moment. I would like to see Q2, but U.K. is probably the only market today in Europe which is softer. Thank you. Thank you, Harry. The next one is Harry Dow from Rothschild. Good morning, Harry. Yeah. Morning. Thank you. Thanks for taking my questions, just two from me. Firstly, on the alternative fuels in Europe at that high level, I just wonder whether you can give us some more color on the volatility of the prices in those alternative fuels. Are they effectively hedged? They're kind of fixed prices, or do they move with time, with kind of spot fossil fuel prices? Then just also coming back to sort of demand and volume implications and sort of elasticity of demand to higher prices. I think when we started the year, cement being mid-single-digit was probably at the higher end in our view of the overall build cost kind of environment. Now when I look at a broad range of building materials and products, actually mid- to high-single-digits is probably where a lot of things are landing. If it's got a lot of energy inputs, it could well be into double digits, certainly in the summer. For the end users, they're now facing, so a home builder is facing more mid-single digit cost inflation this year. Now, where is the elasticity in your view of that to demand? Can margins at the sort of the end of the chain compress further, you think? Or are you still confident that volumes can grow in an environment where you see mid-single digit inflation across the board? Thank you. Good morning, Harry. Thank you for the question. I'll start on the demand and the pricing. Look, so far we have achieved what we hoped for. We could potentially put up additional price increases that will go through the surcharges, but I don't think any of this will have impact on the demand in 2026. Steffen, you can- I think the question was on. I didn't fully understand it, but I think the question was volatility in pricing of alternative fuels. If that was the question, the answer would be, it depends a bit on the market, but the volatility in alternative fuels is of course much, much less because it's trash, right, oftentimes. They are solid supply chains, they are local supply chains, and the price is relatively stable compared to classic fuels in the open market. Something to keep in mind is as the prices of traditional fuels go up, or in some places, the use of alternative fuels also becomes even more attractive and more interesting, and the business cases become even better to payback. As we said before, one of the main reasons why alternative fuels are attractive is definitely the lower volatility. Okay. Thank you very much. Thank you so much, Harry. This was actually the last question for today. I would like to thank you very much for joining us again. If there are any further questions, please reach out to the IR team. We are more than happy to help. With this, I hand it back to Miljan for some concluding remarks. Thank you all for joining us this morning. Very happy with the strong start of the year. We will continue to execute on our strategic initiatives. With our impeccable execution of 45,000 of my colleagues, I am confident that 2026 will be another great year for Holcim. Stay healthy, stay safe, and thank you very much.