Ladies and gentlemen, welcome to the Q2 2022 results conference call and live webcast. I am Alice, the Chorus Call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Ingrid McMahon, Director, IR. Please go ahead, Madam. Thank you. Good morning, and thank you for joining us. I'm Ingrid McMahon, Director, Investor Relations, and with me today hosting the call are Samuel Sigrist, CEO, and Frank Herzog, CFO. The slides for the call are available for download on our Investor website. This presentation may contain forward-looking statements involving risks and uncertainties that may cause results to differ materially from those statements. A full cautionary statement and disclaimer can be found on Slide 2 of the presentation, which participants are encouraged to read carefully. With that, let me now hand you over to Samuel. Thank you very much, Ingrid. Good morning, everybody. I'm pleased to report on a strong business performance in the first half, and this despite the volatile environment. Organic growth was robust, especially when compared with an exceptional first half of 2021. Price increases were implemented across all regions, and in the second quarter, the top line contribution offset the impact of higher raw material costs. We completed the acquisition of Scholle IPN on the first of June, and Evergreen Asia is on track to close in the third quarter. These acquisitions expand our platform and cement our position as a leading solutions provider for sustainable liquid food and beverage packaging. Long-term financing for both acquisitions is in place, including an equity issuance in May and a Schuldschein or German private debt placement at the end of June. As with earlier borrowings, the Schuldschein is sustainability-linked, with targets relating to our EcoVadis score. We continue to drive sustainability throughout our operations. Our sleeves production has been carbon neutral since 2018, and we are now actively increasing the proportion of on-site renewable energy. We are already sourcing real-time renewable energy from wind turbines in Germany, and this year we are installing our largest-ever solar array at our Wittenberg plant, with another installation planned at Linnich site. Energy production from solar panels already in operation at other sites more than doubled in 2021. In Austria, we are taking steps to reduce our natural gas consumption and recently installed a heat recovery system at our Saalfelden plant. This will reduce our use of natural gas at the plant by 45% a year. Turning now to the key figures for the first half. Revenue at constant currency grew by 12.4%. This includes the contribution of Scholle IPN for the month of June. With Scholle consolidated for the full second half, we are on track to achieve our full year growth guidance of 22%-24% at constant currency. Organic revenue growth at 7.5% at constant currency refers to the SIG aseptic carton business, which continues to perform very well. We delivered strong adjusted EBITDA of EUR 281 million. The adjusted EBITDA margin was lower at 24.6% and compares with an exceptional first half in 2021, when we benefited from a significant raw material tailwind. This year we are expecting a more normal seasonality, with the margin more heavily weighted towards the second half. In addition, there is an increasing contribution from price in the second half. Adjusted net income increased and adjusted earnings per share were maintained. Free cash flow, which is structurally low in the first half, was below last year, primarily due to working capital movements. We expect the group to be highly cash generative in the second half, in line with its normal seasonal pattern. In Q2, we saw an acceleration of growth, with organic revenue up 8.8% at constant currency. This reflected both robust volumes and pricing momentum, driving an increase in adjusted EBITDA margin compared with Q1 2022. Adjusted net income increased and free cash flow turned positive in the quarter. I'm very pleased with the significant momentum behind our aseptic carton business. Some of the elements are illustrated on this slide. Sustainability is a key driver with continued adoption of SIGNATURE packaging in Europe and our first SIGNATURE win in food service in North America, a sign that U.S. customers and consumers are focusing more on environmentally friendly options. The launch of SIGNATURE EVO earlier this year expands the offer of aluminum-free packaging across categories. We will accelerate our progress on our Alu-free journey, leveraging Scholle IPN's barrier film technology, as we shared at our Capital Markets Day in June. Our packaging innovations can generate growth for many years. combismile, launched in China in 2017, continues to build momentum in the rest of the world, including in Europe, where it is expanding our footprint for the on-the-go consumption. We also deployed our first combismile line in India for the popular Lassi drink, which is part of the iconic Amul brand. Our most recent platform launch, SIG Neo, next generation filling machines with combivita cartons, will be adopted by Hochwald for the fast-growing plant-based milk category. Service is a key component of our solutions, and we are expanding our digital offering with the launch of mySIG PORTAL. This is a unique platform that offers customers visibility on stock availability and workflows with 24/7 fast mobile access. It also facilitates the collaboration between the customer's employees and our engineers, further strengthening the relationship we have with our customers. Let's now look at how all the regions contributed positively to our revenue growth. In Europe, revenue growth accelerated in the second quarter as price increases came into effect. We are seeing an increase in contribution from on-the-go consumption of non-carbonated soft drinks, as demonstrated by the combismile launches I just mentioned. Our strategic push into plant-based dairy alternatives is also proving very successful. In the second half, we will see an impact on European revenues as sales of sleeves to Russia are discontinued. On the other hand, new fillers placed with Hochwald are continuing their ramp up as the new plant comes on stream. European customers have been at the forefront of adopting our most sustainable packaging materials. In addition, we see benefits as customers continue to switch from PET into carton, with Volvic now using cartons for still water following its launch of flavored water with our cartons in 2021. Commodity prices are driving a new conversion opportunity in the high margin food segment, with increasing interest from customers in switching from can to carton. Middle East and Africa saw a very strong first half year performance across all categories. Market dynamics were favorable, with a strong post-COVID recovery across the region compared to last year when school closures and other restrictions impacted our business. The liquid dairy business in South Africa rebounded compared with the first half of 2021, when our business was affected by the drought there. In addition to price increases, we also saw a strong contribution from new fillers, with new filler placements and the ramp-up of fillers placed over the last 12 months. Across the region, we continue to expand our presence in liquid dairy, positioning us to fully exploit the potential for growth in per capita milk consumption. This is a great performance by the Middle East and Africa region, but it does include an element of pre-buying in a context of longer lead times due to logistics constraints. We therefore expect a bit of slower growth in the second half. Growth in Asia Pacific was driven by Southeast Asia and India as markets recovered from COVID. Revenue in China was affected by the COVID lockdown restrictions, although the white milk segment was stable due to the recognized health benefits of milk. As restrictions eased in June, customers tended to build safety stocks to counter further possible logistic disruptions. Southeast Asia saw continued volume momentum from recent filler placements, as well as a good contribution from price. Diversification into lead performance is bearing fruit and continues to drive new business. We are particularly proud of the multiple filler wins achieved in India, including with a major dairy and FMCG players. Overall, the flexibility of our system and portfolio is proving its value to customers faced with the need to reduce pack size to ensure affordability of their products. Filler flexibility has also been a key driver for the high number of new filler placements over the last couple of years in the Americas, notably in Brazil. We have combined key customers as they have grown their share of the market. We have also continued to expand in the neighboring countries to Brazil. The consolidation of Scholle IPN for one month has the most noticeable impact in the Americas. Bag-in-box sales performed well in North America in the second quarter. The construction of our new sleeves plant in Mexico is on track, and commercial production is expected to commence in the first quarter of 2023. This will enable us to supply our U.S. customers faster and more efficiently, and will sustainably reduce our exposure to supply chain disruptions. In conclusion, a strong contribution from all regions. Frank, now over to you for the details on the financials. Well, thank you, Samuel. Good morning, and also warm welcome from my side. We delivered a strong performance in Q2 of 2022, and I'll now give you some more details. Let me start with the EBITDA and highlight some of the trends between the quarters, especially the expansion of the EBITDA margin in Q2 compared to Q1, as well as the absolute EBITDA increase, as you can see on the slide. After a number of years of negative impacts, FX made a positive contribution in the first half with the weakness of the euro against most major currencies. The contribution from the top line increased significantly, including both volume and price benefits, and it compensated the headwinds from raw material costs in Q2. The raw material impact in the second half will depend on the evolution of spot prices for the unhedged volumes of our raw materials. We've seen these prices come down in recent months from their peak levels in early spring. As already mentioned, the contribution of pricing will continue to increase as negotiations conclude with customers in the course of the year. In the second quarter, we saw a significant negative impact under the heading of production efficiencies. This includes higher freight and energy costs, with freight particularly affected due to the cost of supplying the North American market, given well-known port congestion issues and the need to make one-off use of air freight. We do not expect these costs to recur to the same extent in the second half. The EBITDA contribution from acquisitions in the second quarter was EUR 11 million, entirely due to the one-month consolidation of Scholle IPN. The contribution from acquisition in the first half included, in addition to Scholle IPN, two extra months from the Middle East, Africa business compared to the first half of 2021. This positive amount under other occurred mainly in the first quarter and is a result of not having the negative contribution from the Whakatane paper mill, which was sold last June, historic warranty claims, and a number of other smaller items. Let's now move to look at the regions. It's clear that most regions have been affected by increasing sourcing and freight costs, with a negative impact on their margins, as you can see on the slide. As you saw from our Q2 EBITDA waterfall on the previous slide, we're increasingly offsetting these costs with higher top-line contribution, leading to quarter-on-quarter expansion of our EBITDA margin. I'll detail a few specific points on the regions. For example, Europe disproportionately bears the higher cost of sourcing, given it is a global production hub supplying other regions. Of course, the war in Ukraine had an impact on energy prices in this region. In contrast, Asia-Pacific saw strong top-line drop-through and benefited from relatively lower raw material cost increases due to its localized sourcing strategy. Also, its margin benefited from the elimination of the losses during 2021 from the Whakatane paper mill, which we divested in June of last year. Middle East, Africa, and the Americas experienced particularly high logistics costs in addition to raw material inflation. The Americas region also was impacted by some costs related to the new sleeves plant in Mexico. In all regions, we have been successfully pushing through price increases, which will increasingly benefit margins in the second half. Keep in mind that the seasonality of our business with higher volumes in the second half of the year will lead to higher cost absorption. This, together with the realization of production efficiencies, is expected to drive EBITDA margin expansion. Let's take a look at cash flows. Our free cash flow is structurally weighted towards the second half of the year. Comparing the first half of 2022 with 2021, we've seen an increase in net working capital, leading to a reduction in net cash from operating activities. This reflects elevated customer bonus payouts due to the strong prior year performance and some inventory buildup to address logistics constraints and extended lead times. The absolute increase in net working capital is also as a percentage of revenue, was driven primarily by the first-time consolidation of Scholle IPN and also the increase in inventories. Scholle IPN has historically had higher net working capital, and we've identified opportunities to reduce this. Moving now to take a look at CapEx. Expenditure on property, plant, and equipment increased year-over-year as we continue to invest in our operations, primarily with the construction of our new sleeves plant in Mexico. Our level of gross filler CapEx continued at a good pace, reflecting the placement of new fillers as a basis for future revenue growth. As a percentage of sales, net CapEx was 3%, reflecting the high level of upfront cash received from a European customer on a major project. We still maintain CapEx as a percentage of revenue within our guided range of 7%-9% for the full year. Let me now turn to leverage and financing. Net debt at the end of June totaled EUR 2.1 billion, while leverage was, as expected, slightly higher at 3.1 times. This, of course, reflects the financing of the acquisitions during the first half of the year. Our midterm guidance remains to reduce leverage towards 2x with a milestone of approximately 2.5x by the end of 2024. We are pleased to have successfully secured the long-term financing of our acquisitions with three components to implement our balanced financing strategy at attractive terms. In May, we issued new shares with proceeds of EUR 200 million. In June, we successfully placed a sustainability-linked Schuldschein or German market private debt placement for EUR 650 million, which diversifies our funding base beyond bond and bank debt. Finally, in July, we arranged a term loan for $270 million. These long-term financings will repay or cancel the bridge loans that were arranged at the time of the acquisitions. The elevated cash position on June 30 is available for the Evergreen Asia acquisition. Following the completion of all financings, our average cost of debt is around 2%, and our maturity profile is extended to 2029. This financing was achieved in a challenging macroeconomic and capital markets environment, demonstrating that investors value the resilience and cash generation of our business. This confidence is also reflected with S&P and Moody's confirming our ratings following the acquisitions. We now turn to our guidance for the full year, which remains unchanged. With regard to revenue, Scholle IPN will be consolidated over seven months rather than six, as foreseen when the guidance was set at the beginning of March. Evergreen Asia, on the other hand, will be consolidated for fewer than six months. In addition, the sanctions against Russia are expected to reduce full year growth by approximately 125 basis points. Taking this into account, we remain confident that we can achieve full year growth of 22%-24% at constant currency. We expect to continue to face higher sourcing costs in the second half compared to last year, but these increased costs should be increasingly offset by customer price increases, and we have seen initial reductions in prices for aluminum and polymers in recent months. We continue to expect to achieve an adjusted EBITDA margin for the full year of around 26%. We also confirm our guidance for net CapEx as a percentage of revenue between 7% and 9% for 2022. Our dividend policy remains unchanged with progressive growth of our absolute dividend per share, the payout ratio of at least 50%-60% of adjusted net income. In summary, our business is proving its strength and ongoing growth potential as well as its defensive nature. We are present in resilient food and beverage markets. We benefit from multi-year contracts for liquid paper board, our primary raw material, and have proved our ability to raise prices. Thank you for your attention, and this concludes our presentation for today. Samuel and I would now be happy to take the questions. We will now begin the question and answer session. Anyone who wishes to ask a question or make a comment may press star and one on the touch-tone telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Anyone who has a question or a comment may press star and one at this time. Our first question comes from the line of Christian Arnold with Stifel. Please go ahead. Yes. Good morning, gentlemen. Can you hear me? Very well. Good morning. Good morning. Couple of questions from my side. You mentioned back when you were presenting your full year figures, also an organic growth guidance of some 7%-9%. Based on some 15% external growth. You have not mentioned that today, I think also not with the Q1 numbers. But is that still the figure we should look at? The underlying organic growth, excluding all external effects and acquisitions? Absolutely. I mean, you're absolutely right. We said our carton business, which normally is expected to grow in a range of 4%-6% given the price impact we see this year, is expected rather in a higher range of the 7%-9%. We haven't repeated this because obviously our headline guidance is around the 22%-24%. Now given that we maintain our 22%-24% guidance and remember 85% of the business is the aseptic carton business, I think that implies that we remain very confident also in the aseptic carton business. You see in the first quarter, the second quarter, with the acceleration of growth, that we indeed also are on a very good trajectory. Okay. Thank you. Is it a fair assumption to think that half of that 7%-9% is maybe price driven and the rest is volume driven? We said at the beginning of the year, the price effect is gonna be 3%-4%, and we also said already in the Q1 call with the visibility of what we knew on the price effects that are gonna come, they're gonna become effective over the course of the year that we meet our expectations. 3%-4% is the range to think of. Okay. On MEA, Middle East Africa, strong performance. Do you expect any impact from the upcoming football world championship, or have you already experienced some positive impact, stock building also on the back of that? Thinking of the Qatar World Football Championship. I mean, we saw that with other large events, whether it was Olympics or championships, they can have an impact in local markets, but I don't think that they become relevant for an entire region, needless to say, the Group. From that perspective, we expect positive momentum but not really material impacts on the top line. Okay. Thank you. Maybe last thing on Scholle IPN. I mean, if I calculated correctly, you have a positive impact of some EUR 45 million-EUR 47 million sales. Talking about EUR 11 million EBITDA contribution, that implies an EBITDA margin of 23.5 percentage point, something like that. Is that a figure we should also look for second half, or do you also have here some seasonality? I think if you do the math, I think it's about EUR 50 million revenue in [Q11] that you referred to. EBITDA gets you to a margin of, give or take, 22.5%. You know, that's a single month. I wouldn't read too much in that. I think they were very strong. They had a good month, but I wouldn't use, assume that is the new normal. Obviously, we maintain the guidance for the combined business with around 26%, which includes also the seven months for Scholle IPN. You're saying the 22.5% is very strong month, so for seven months of this year, it will be rather below that? Yes. I think it's a strong month. It's a strong month also from a margin perspective. Thank you very much. Thank you, Christian. The next question comes from the line of Alessandro Foletti with Octavian. Please go ahead. Yes, sir. Good morning. Also a couple of questions. Thank you for taking them. Coming back to the Scholle question, I was also surprised about the strong month. This EUR 50 million, can you say how much it was, so to speak, the growth for Scholle in organic terms? Good morning, Alessandro. I mean, on the growth, we haven't really provided an update on monthly growth rates. There you see it's the first month. I wouldn't also read too much, as we just discussed with Christian, into the performance of a single month. We remain confident that Scholle IPN is gonna deliver growth along the lines of what we anticipated. As you can imagine, there is an element of pricing as they have also these pass-through clauses, but also through underlying volume growth as a function of new customer wins where they go through a ramp up. Very pleased to see that, and all that is encompassed or embedded in our 22%-24% growth guidance that we maintain. Okay. Is there any reason why June is specifically a strong month? No. I mean, you know, a single month, I would really not read too much into. I understand that. I understand that a single month is not. You know, much more than the run rate of EUR 474 million divided 12 that I could calculate, right? That's the point, right? I think it is a very strong single month, and you shouldn't assume that that is the run rate, right? Going forward. Obviously, as you run a business, there can be many reasons why a month can be stronger than the other, and it has to do with Incoterms and how your revenue recognition happens and whether the vessel leaves the port on time or not. All these things come together, and it led to a very strong month of June. All right. Okay. Another question is on the input cost. Can you give, maybe you cannot give the numbers, but, an indication of how strong was the effect from energy, raw materials and logistics? Because you also said that logistics obviously were particularly heavy for you in some areas. Let me take this. I think it's no secret in Europe energy prices are going up. Bearing in mind, if you look at the 2021 figures, energy overall for the group is only 1% of revenue. So we're not such an energy-intensive business if you compare us with other aluminum-based business, smelting, whatever. So that I think is to put this into perspective, obviously within Europe, energy prices, electricity, gas, you know, all went up quite significantly. It obviously impacts Europe. That's also what we saw in the Europe margin. I think overall, you know, we don't like it, but we're not as substantially affected as other businesses and industries and companies. On freight, U.S. port congestion, I think is a well-known topic. Lead times extended. Our customers do need, you know, to have products at certain points in time to fill up, you know, their milk or juices or milk alternatives. We did have to resort to some air freighting. We don't like this because it's expensive, but we have a promise to our customer, and we fulfill our customer promises. We've taken certain actions, also increasing safety stocks, et cetera, that we expect that shouldn't reoccur. Obviously, we don't, you know, can foresee what the port situation in North America is going to be. I think those are kinda some, you know, questions that you had. Also, if we look at raw materials, I think it's interesting to see that in Asia over the last 18 months, raw material prices haven't moved as much as they have in Europe. When you look at polymers, they started more or less at the same level at the beginning of 2021, and then European prices went up quite a lot and then kinda peaked in March, as I said. Whereas Asian prices and Chinese prices didn't go up that much, so that's also where you see those effects of raw material and polymers in particular being concentrated in Europe. Okay. If I look at the bridge, EUR 69 million is raw material. That's only raw materials. I imagine the energy and, which is small and freight is within production. Production. -efficiency. That's right, yes. All right. Thank you. Thank you, Alessandro. As a reminder, if you wish to register for a question, please press star and one on your telephone. Star followed by one. The next question comes from the line of George Burrows with BNP Paribas. Please go ahead. Hi. Good morning, Frank. Good morning, Samuel. Good morning. I just wanna ask about your main production hub in Linnich, in Germany, please. Given the sort of energy crisis in Europe at the moment, what is your exposure to natural gas there? What kind of contingency plans have you put in place, please? I mean, a number of thoughts on that. As Frank alluded before, we are not an energy-intense player. If you look to the overall energy consumption that we have globally, there is the majority of it is electricity. There are some production steps where we still use gas. We are also in the process to further reduce that. There are some where we just don't get out in short-term, but work on mid-term solutions. If you look to give you a bit of a perspective to the total costs 100 bps globally that we pay on energy. It is around, give or take, 17 bps that we sourced gas last year of that, and we have the potential to reuse that a bit further. There's a remaining portion that we need to buy. I think while there are midterm solutions to get away from natural gas, and I think that's a time horizon of kind of give or take 2+ years. I think there is also the fact that we are considered essential industry in those countries where we operate. In some countries, we even got that in writing confirmed by the government, as we are an integral part of the value chain to provide basic food products to people. From that perspective, even if you think in a scenario of rationalization or rationing the gas product, I think we are confident that we can keep operations up. Thanks. Very interesting. On a different topic, I also wanted to ask more specifically about China, please, and the challenges of the zero-COVID policy there. Could you just elaborate on the kind of disruption that your business faced in Q2 and maybe now how things stand today as we go into the first month of Q3? Sure. I mean, the lockdown from our perspective included more people than what we saw last year. Last year, you could literally say the country was locked down, but within the country it was easier to move. Obviously, not as normal, but not as difficult as it was now in the second quarter, as so many people were under lockdown. What it meant for our customers was that distribution became very difficult because transportation from one province to the other was very difficult because truck drivers didn't know where to take the tests and what tests they need to have. That did have a major disruption on distribution of our customers and their end products or distribution to the end consumers. We also saw that one of the other customer had to stop production in April, May. What it meant to us specifically, we kept our operations running throughout the entire Q2, and we also were able to generally get our shipments to the customers, so where they got stuck was kind of as finished products from customers to end consumers. What we saw with the opening then and the relief of the lockdowns is that people kind of did build up safety stocks and pulled more in the second quarter, towards the end of the second quarter, and that's why I think overall we look at a very solid number. Obviously if you speak now to our customers in China, they still signal to us that they wanna meet overall full-year commitments. That's also what we assume from talking to them. Great. Thank you for the color, and well done on those good set results. Thanks, George. The next question comes from the line of Joern Iffert with UBS. Please go ahead. Hello, Samuel. Hello, Frank. Thanks for taking my questions. The first one would be please on the EBITDA bridge. It seems that the EBITDA growth is driven by FX and others in Q2. I know it's not always fair to just point at one quarter. I was wondering why there were not more benefits from the price increases already, in the margin development, for example. Is there any specific reason why the pass-through on our pricing costs have some delays? And also if I look on the pricing to this magnitude, assuming that it's maybe 3%-4% for Q2, this is what you also mentioned the full year guidance, but you're also saying at the same time, your price actions will further improve the margin in the second half. Is it still staying with the 3%-4% for this full year, or could be even a little bit higher? I would take the questions one by one, maybe starting with this one, if I may. Oh, that makes it easier for us, too. Thanks. Good morning, Joern. From a pricing perspective, we talked about already in Q1, and what we saw is that obviously customers experienced price increase for basically any product and service they buy. Pricing increases went through in line with expectations. That's the 3%-4%. We didn't break it down to a quarterly level, but on a full year basis, we expect it 3%-4%. We did see that obviously some of the price increases, even if agreed in Q1, may have become only effective in Q2. We also had one of the other surcharge now that we kind of initiated also in the second quarter, which became effective in the second half year. I think from that perspective, you can assume that pricing will gonna help us to improve margin in the second half year. The 3%-4% is still the right range to think about for the full year. Okay. Thanks for this. Second question on the full year guidance. You're guiding for businesses like Evergreen, which you do not own right now. Scholle IPN you now own for two months. What is your conviction level and confidence level that these two companies in particular, also Evergreen, can really deal successfully with the inflation environment, passing on the costs, having all the good executions continuing? What is giving you the conviction here as Evergreen, for example, is not under your control? Oh, it's correct. Evergreen is not under our control. Scholle is since the first of June, but with both businesses, we did engage in integration planning to the degree that was allowed, and obviously we did our due diligence. I think we understand the drivers of the business well, and from that perspective, we are confident we maintain the guidance for the full year, both on the top line as well as on the margin level. Okay. Maybe the last question, if I may. Just let me check here on the cross-selling. With Scholle IPN. I mean, you own it now for two months. I know it's a short time period, but you also mentioned something on your CMD, but do you have some more incremental color if cross-selling can already contribute materially to your top line in 2023 from Scholle IPN? Yeah. I mean, what we went through by now, and we concluded that that exercise is we had workshops in all regions where we operate between our legacy team and the Scholle team, and we did joint account planning for cross-selling opportunities. I think all the teams, even in those markets where Scholle historically didn't have a presence, have now kind of a target and know what the route to market is. I think that was the first step. As you rightfully say, on the CMD, we had one customer from South Africa that announced that he's gonna buy a bag-in-box line, and I think we're in talks even for a second line right now. We have other cross-generation leads already in Southeast Asia. We are really pleased with the progress there. It's a good start. We think over time, they will become more and more material. I think we're gonna see first numbers also in our 2023 fiscal year numbers of cross-selling efforts. All right. Thanks a lot. Thank you, Joern. Once again, for your questions, please press star and one. We have a follow-up from Mr. Burrows with BNP Paribas. Please go ahead. Hi. Thanks for taking the follow-up. I noticed in the presentation you were calling out shrinkflation, which I presume to mean when your customers kind of shrink the format but keep the prices the same. I just wanted to ask about what you're seeing from your customers in terms of them passing on all the inflation across the value chain. Is shrinkflation kind of becoming more and more important? Are they still pricing aggressively and passing on all the inflation that they're seeing? How do you think the consumer is positioned as we go into the second half of the year, particularly in some emerging market economies, with the inflation that they're facing? Thanks. Yeah, I think we see two trends, George. We see in the more mature markets that our customers pass the changed input cost on to the end consumer. Retail prices go up, while quantities are maintained. That's also why CPI goes up in many mature markets. CPI goes also up in emerging markets, but especially for our product in emerging markets like India, like Thailand, where traditionally price points are very important to maintain because you know, people associate brands with certain price points. There we see that our customers' response to deal with the higher input cost is what we call shrinkflation. Means reducing the pack size. That's exactly where SIG is strong. You're familiar with the fact that we have volume flexibility, which allows our customers to reduce the pack size within less than 10 minutes on a filling machine, so they can cater to these price points. I think that's what we see more in the emerging markets. Your question, the second part of your question is related to price elasticity, right? I think it's worth to remember that we operate in this entry level of processed and packaged food, right? That is basic products. When we look back to other economic periods of economic slowdown, we haven't seen significant reduction in consumption as a function of slowdown GDP growth. Even you may remember when Brazil went through these economic challenges post the impeachment of Dilma Rousseff. I mean, our business kept growing, admittedly at lower rates, but we kept growing. That's kind of the proof point that we have, besides multiple others in the Middle East, and also during the great financial crisis, that our business has its resilience, also in an environment like the current one. Thanks very much. Thank you. The next question comes from the line of Daniel Koenig with Mirabaud Securities. Please go ahead. Yes, good morning. Can you hear me? Very well. Good morning, Daniel. Yeah. Hi. I had two smaller questions. First, on Middle East Africa, that is quite a region which is like characterized by oil-producing countries. I was wondering, what is your expectation for the full year? I guess the economies in the Middle East must be extremely strong. The second question would be on China. I just had a simple question. Did the Chinese market, what kind of growth did they produce in Q2? I was wondering if you could give an update on the new plant on that ramp-up. Thanks. That's it. Sure. Thanks, Daniel. I think on the Middle East, absolutely. I mean, many of those economies are linked to the oil industry, and whether they do well or not is a function of the oil price. We do see that also in consumption there for our products. Again, that said, you know, price elasticity is rather limited for the products we pack. These are products of basic consumption, of basic needs at the entry level of processed and packaged foods. That's why those economies are linked to the oil price. We don't see a very strong correlation with the consumption of our product. I mean, as I said it before, during the call already, we are very pleased with the recovery that we see in the Middle East. They had obviously headwinds last year from COVID, but also from the drought in South Africa, and they clearly demonstrated that they can come back strong. I don't think the rate that you see now is the rate for the full year. We're also familiar with the fact that we don't provide guidance for segment levels, but we're obviously absolutely pleased with the recovery in the region. Okay, thanks. On China? I don't have specific growth rate for the overall market for Q2 yet, because it's a bit difficult as there was a major shift in the market, you know, a major shift between offline and online. During lockdown, a lot of our products, we already have a high share in online, but a lot of our products were shifted to the online channel as people just simply weren't allowed to go out. Also the data providers struggled because there was a lot of community buying, you know. People organized themselves and bought bulk orders for entire houses, house complexes, and then distributed amongst themselves. So it's a bit patchy there. What we clearly see is that the consumption of white milk continues to do well as it did earlier during COVID. I think we also see the benefits from that in our numbers. Your last question was on the plant that we have underway. I think you referred to Mexico, if I got that right. Otherwise, please interrupt me. I think- No, no. The China plant. You know, this huge second plant, you know, you were ramping up or building or. Got it. No, that came on stream as planned. It's fully operational, and it is working right now. There was no implication from lockdown. It's also in the city of Suzhou, close to Shanghai, where we were able to operate also throughout the lockdown. Okay. just performed in line with expectations. Okay, thanks. Thank you. For any further questions, please press star and one. There are no more questions at this time. Back to you for any closing remarks. Thank you very much. If there are no more questions, let me conclude the presentation of today. In conclusion, I'd like to say these strong results continue as I see track record of profitable vast market growth, and we talked about that at the Capital Markets Day. We have a strong pipeline of filler wins, demonstrating that our customers value our technology and flexibility. We talked about shrinkflation and our volume flexibility. Across our recently expanded portfolio, the markets where we operate are resilient and growing. We also touched on that. The acquisition of Scholle IPN has made great start, and we are already addressing the many commercial and technological opportunities which it opens up. We talked about cross-selling, but it's also on the barrier film side. We are maintaining our best-in-class ESG profile with a focus on circularity and providing the lowest impact packaging across substrates and categories. With this closing remarks, I would like to thank you for participating in today's call, and I wish all of you a great summer break, and see you after the summer. Thank you very much, everybody. Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.