Ladies and gentlemen, welcome to the SIG Q2 2025 results conference call and live webcast. I am Valentina de Carlos, Call Operator. I would like to remind you that. All participants will be in listen-only m ode 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. Webcast viewers may submit their questions in writing via the relevant field. 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 of Investor Relations. Please go ahead. Thank you and good morning ladies and gentlemen and thank you for joining us. I'm Ingrid McMahon, Director of Investor Relations and with me today hosting the call are Samuel Sigrist, CEO, and Anne Erkens, 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 hand you over to Samuel. Thank you Ingrid and welcome everybody. Starting with the business summary of the half year, we are pleased with the group's performance in the first half of the year, driven by operating improvements and share gains in a challenging market environment. As expected in the first half of the year, market conditions remain subdued, driven by lower consumer purchasing power. SIG's revenue growth of 2.1% in this environment demonstrates the resilience of its product categories, the strength of its market-leading innovations, and the effectiveness of its go-to-market strategy in driving share gains. Carton grew by 2.6%, while revenue performance for bag-in-box and spouted pouch was stable year- on- year. This included good revenue growth in U.S. Food Service. Despite a soft market environment, SIG filling equipment remains in demand, and this is across all substrate in bag-in-box and spouted pouch. We continue to make good progress in synergy deals. As of June 30, emerging markets represented 32% of all deals, and the share of aseptic technology represented 79%, up from 75% at the end of 2025. All deals are structured as system solutions, which include recurring packaging revenue. In aseptic carton, we expect to place between 60 filler- 80 filler for the year. A key driver of demand has been our ability to offer customers volume flexibility, which enables them to tailor pricing strategies for their end consumers. We continue to lead the way in industry innovation during the period with several exciting developments. Firstly, we launched alu-free packaging with Aldi private label for grape juice. This is a further development of our alu-free offering, which can now provide full barrier protection not only for low acid products such as milk but also for high acid oxygen-sensitive products such as fruit juice. Secondly, we entered a strategic partnership to develop an industry first, an aseptic paper-based closure using dry molded fiber technology. This is part of our strategy to reach our 90% paper target for our aseptic cartons by 2030. Thirdly, we developed our first 15,000 L/h SIG Neo filler for multi-serve packs to a customer in Saudi Arabia. This is an increase in filler output of 25% for 1 L packs, continuing to enhance our industry-leading total cost of ownership. Moving to financing, we successfully completed our 2025 debt refinancing in the first half of the year, extending our debt maturity profile. Turning now to the key figures for the first half, revenue at constant currency grew by 2.6% due to higher resin costs in bag-in-box and spouted pouch which in most cases are passed on directly to customers. Growth at constant currency and constant resin was 2.1%. Adjusted EBITDA increased to EUR 372 million, resulting in a margin of 23.6%. This reflected a higher top line contribution, partially offset by adverse foreign currency movements and SG&A costs. The increase in adjusted net income included phasing of interest cost as well as higher adjusted EBITDA and lower tax expense. Free cash flow reflects an increase in customer incentive payments in the first half of the year due to strong volume growth in 2024. Looking at the Q2 performance, foreign exchange headwinds negatively impacted the financial performance in Q2. Unlike in Q1, where there was no overall impact from currency movements, reported revenue declined by 2.3% while on a constant currency basis revenue grew by 1.6%. Adjusted EBITDA reflects a EUR 17 million adverse impact from currency movements. As you know, free cash flow is structurally lower in the first half of the year, which is compensated for by cash generation in the second half in line with our normal seasonality. Turning now to the regional performance in Europe, growth is normalizing. After exceptional growth in 2024 of 6%, the region saw a return to usual levels of milk supply for aseptic processing compared with a strong increase in 2024. We continued to gain share in carton, reflecting our leading filler win rate of recent years. There is a good project pipeline for all substrates in the region, including cross-selling opportunities in spouted pouch and in dairy bag-in-box. Europe's adjusted EBITDA margin in the first half was 32.1%, a significant increase compared to the prior year. This reflects a positive contribution from mix and a strong euro as well as production efficiencies. The EMEA region reported revenue growth of 4.6% for the period. This is despite a high prior year comparison of over 11% in the first half of 2024. The Middle East and Africa saw strong growth in aseptic carton in GCC and North Africa. North Africa has benefited from increasing consumption following a period of more sustainable consumer prices. In India, we have expanded our presence in the dairy sector, which has led to a significant increase in dairy volumes compared to the previous year. Revenue in Q2, however, was impacted by the early onset of the monsoon season impacting on the on-the-go consumption for soft drinks. During the period, the margin was impacted by ramp-up cost for our sleeve plant in India, higher SG&A, and unfavorable FX in APEC. Revenue increased by approximately 1% compared to the prior year, with growth of 2% in the second quarter. A strong performance in the rest of Asia offset a subdued market environment in China. Despite the market environment in China, SIG is gaining share in the aseptic carton driven by our size flexibility. This is allowing brands and retailers to offer unique sizes for different channels, including online and in-store. bag-in-box saw strong revenue growth during the period as the substrate was adopted for aseptic dairy in food service with one of our large customers. In the rest of Asia, the region reported strong growth, notably in Thailand, Korea, and Japan. Growth was driven by product innovation utilizing SIG Drinksplus technology, leading to market share gains. This technology allows for the inclusion of particulates that cater to current health trends such as fiber and fruit pieces. The margin in Asia was impacted by unfavorable FX, mainly in the Southeast Asia region, as well as higher sourcing costs. The Americas reported a strong year-on-year revenue performance in the first half of the year, with growth of 7.4% at constant currency or 5.5% at constant currency and constant resin. Aseptic carton continued to perform strongly in Latin America. In Mexico, where the group has seen strong demand, SIG is expanding its carton sleeve plant. With this expansion, SIG will be able to better meet growing demand for smaller packaging. In the on-the-go segment in bag-in-box and spouted pouch, there was good growth, especially in the aseptic dairy for food service. Consumer sentiment, however, remains soft in the U.S. The decline in margin during the period was impacted by the depreciation of the Mexican Peso and the Brazilian Real, investments to enhance our capabilities in the U.S., and wage inflation. This brings me to the end of my part of the presentation, and I now hand you over to Anders. Thank you, Samuel, and good morning, everyone. Let's start by looking at the adjusted EBITDA bridge. Adjusted EBITDA for the first half was EUR 372 million compared to EUR 369 million a year ago. Performance was impacted by unfavorable currency effects, which negatively affected the margin by 60 basis points. Excluding the currency impact, adjusted EBITDA increased by 5.5% in the first half of the year. Top line made a strong contribution to the margin through a combination of improved volume mix and price. A favorable polymer cost development driven by effective hedging and successful tenders resulted in the benefit to raw materials during the period. We do not expect a benefit to raw materials in the second half of the year. Production costs primarily reflected the ramp-up of the new carton plant in India as well as wage inflation. These were offset by an improved operational performance. SG&A costs were elevated during the period. However, a partial reversal is expected in the second half of the year. Given the significant change in FX rates that we have seen during the period, I wanted to shed some light on what this means for SIG Financial. Approximately 35% of the group's revenue is transacted in euros, 30% in the U.S. dollar, and 35% in the remaining other currencies, primarily the Chinese Renminbi, the Brazilian Real, the Thai Baht, the Mexican Peso, and the Indian Rupee. The unfavorable FX impact, which occurred largely in the second quarter, was mainly from the depreciation of the Brazilian Real and Mexican Peso. While the average U.S. dollar during the period was in line with H1 2024, the U.S. dollar reached 1.17 against the Euro at the end of June. If current spot rates remain for the second half of the year, the negative currency impact will further accelerate compared to the EUR 17 million impact in the second quarter. In addition to the impact on EBITDA, free cash flow generation will be similarly affected. For KPIs that include a P&L metric as well as a balance sheet metric, it is important to consider that the appreciation of the euro is factored in differently for the half-year reporting. While the balance sheet items are measured with the period-end rates, the P&L metrics are translated with the average of the last 12 months. As such, these KPIs look more positive in the half-year reporting, and this impact will normalize for full year when the average rates for the last 12 months will reflect the appreciated euro more comprehensively. As a reminder for EBITDA, a general rule of thumb for the group is that a 1% appreciation of the Euro against all other currencies leads to a -1 0 basis point EBITDA impact for a full year. The next slide details the reconciliation from EBITDA to adjusted EBITDA. Adjusted EBITDA is EUR 9 million higher than reported EBITDA for the period. The decline in reported EBITDA was primarily due to unrealized negative raw material hedges and other, which included one-off costs related to the upgrade of the group's ERP landscape, including the system integration of the acquired businesses. This slide details the reconciliation from profit for the period to adjusted net income. The largest change here compared to the prior year is the cessation of the Onyx PPA, which was fully amortized as of the end of Q1. Net capital expenditure, including lease payments, decreased by EUR 19 million- EUR 110 million for the half-year period. EP&E CapEx reduced by almost 20% and included investments for the group's Indian and Mexican production facilities. Net CapEx for filling lines was lower compared to H1 2024. We expect to place 60- 80 aseptic carton fillers for 2025. Net CapEx, including lease payments, is forecasted to be within the lower half of the 7% to 9% of revenues for the full year. Free cash flow was negatively impacted by higher payments for volume incentives in the first half of the year due to the strong volume growth in 2024. In addition, free cash flow generation was also impacted by the unfavorable foreign currency movements during the period. The benefit in net working capital compared with H1 2024 reflects favorable currency movements and lower receivables due to improved collection. Net working capital in percent of revenues improved by 100 basis points without the positive currency impact. At the end of Q2, the operational improvement was 30 basis points. As usual, the group's cash flow generation is weighted to the second half of the year. Turning now to net leverage and financing, our leverage ratio improved to 3x at the end of June compared to 3.2x at the end of June 2024. The ratio did benefit from only one quarter of adverse currency movements captured in EBITDA, while the group's net debt position benefited from the translation of U.S. dollar debt into euros already reflecting the lower spot rate by end of the year. If the rate remains at current levels, the FX impact on EBITDA will naturally have a stronger impact. Cash and gross debt balances reduced at the end of the period following the redemption of the 2020 Euro bond in June, utilizing the cash raised from the bond issuance in March 2025. In the second half of the year we expect interest expenses to be higher than in the first half as the bond raised of this year naturally will have a higher coupon than the 2020 Euro bond. Approximately half of the group's debt is subject to floating rates and since last year the average group interest rate has reduced by 50 basis points. That concludes the update on the first half results which reflect a resilient performance in the current market environment. Now turning to guidance, we are narrowing our full year guidance for total revenue growth at constant currency and constant resin to the lower half of the 3%- 5% range. The adjusted EBITDA margin is expected to be at the lower end of our 24.5%- 25.5% range, in line with our usual seasonality. The adjusted EBITDA margin and free cash flow will be higher in the second half of the year. Net CapEx, including lease payments, is now projected to be in the lower half of the 7%- 9% range of revenue. As always, our guidance is subject to fluctuations in input cost and foreign currency volatility. We confirm our mid term guidance. This includes revenue growth in the upper half of our 4%- 6% range and an adjusted EBITDA margin above 27%. Net CapEx, including lease payments, is forecast to be within a range of 7%- 9% of revenue and the dividend payout ratio is expected to be 50%- 60% of adjusted net income. We are pleased to announce our Capital Markets Day on October 2. It will be held in Zurich and it will include an introduction from SIG's new Chair, Ola Rollén. Samuel, Ingrid and I look forward to welcoming you together with other senior members of our management team and this concludes our presentation and we're now happy to take your questions. We will now begin the question and answer session. Anyone who has a question may press star and one on their telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourselves from the question queue, you may press. Questioners on the phone are requested to disable the loudspeaker mode and eventually turn off the volume from the webcast while asking a question. Webcast viewers may submit their questions in writing via the relative field. In the interest of time, please limit yourself to two questions. Anyone who has a question may press star and one at this time. The first question comes from Charlie Muir-Sands from BNP Paribas. Please go ahead. Yes, good morning. Thank you so much for taking my questions. The two I have are firstly just related to the full year growth guidance that still obviously implies a bit of an acceleration required in the second half in order to reach even the lower end of the range. I just wondered what regions and or which substrate you expect to see that acceleration in and what kind of visibility or other confidence you have in that coming through. The second question relates to free cash flow. I understand the effects of seasonality and the high volumes last year, but just in terms of if you were to reach the bottom end of the range for the year and current exchange rates held, could you give us a rough indication of what kind of absolute free cash flow you think that the company might produce in 2025? Thank you. Good morning and thanks for your question. Charlie, maybe let me start with I don't think we limit the questions to two. We are here to answer your questions, as many as you have. Not you only, but for everyone, the guidance. We expect a kind of a sequential improvement, basically quarter- over- quarter across all substrates and geographies. What gives us this visibility and confidence are a number of things. Number one, and we talked about that as you recall at the very beginning of the year where we said H1 will be of slower growth as H2 because we have visibility of new lines that are going to come on stream in the second half, respectively the ones that were just put in place in the first half and go through ramp-up. That will help us in the growth for the second quarter in a sequential manner into Q3 and eventually Q4. The other point is, and that is not a surprise in our business model where customers have this volume incentive. If you have a slower growth in H1 because customers maybe don't put too much on stock in terms of products to fill, then normally they catch up in the second half because they want to hit their volume targets. Maybe for the cash flow over to you, Anna. For the free cash flow question, a rough indication, let's start with last year. We achieved EUR 290 million, if you recall. We have also discussed at the end of last year that this included one-off impacts of around EUR 30 million related to an improvement project that we conducted last year, around how we place fillers, how we structure our contracts and the upfront cash payment terms, plus also better managing the filler inventory. If you take that as a normalized basis and then include also the currency impacts, we discussed EUR 17 million impact on adjusted EBITDA for one quarter. If you just extrapolate that to the second half, probably even slightly more, considering where the spot was compared to the average of the second quarter, and against this, calculate some operating improvements that we of course have on adjusted EBITDA level, I think that should give you a bit of an indication where we could end the year. Many thanks. If I may have one more question, just your latest reflections on tariffs. I realize that some of the news has only just come out in the last couple of days. Relatively speaking, how do the tariffs affect the level of additional costs that you are incurring in your business now versus what you might have been anticipating previously? Thank you. Considering the latest agreements between the European Union and the U.S. from Sunday, we don't see a significantly changed picture compared to what we have today discussed before. In the first half, the impact of tariffs is, I don't want to say negligible, but pretty small year to go. This is probably a low single-digit million on top to come. On a run rate on a full-year basis, we would be in a mid to high single-digit range, million Euros. Many thanks. Thank you. The next question comes from Alessandro Foletti from Octavian. Please go ahead. Yes, good morning everyone. Thank you for taking my questions. Can I ask three please? On the foreign exchange transaction, you mentioned the EUR 17 million. Can you break that down in the regions? Overall, a breakdown of the 17, as mentioned before, a significant portion of this goes to the Brazilian Real, the Mexican Peso, but then also Swiss Franc has an impact overall, and the larger basket overall. Also, the dollar impact as discussed for the first half wasn't that strong, but also more than EUR 1 million included for the dollar. Right. Does it mean that this is the reason for your, I don't have another better word to define that, but for your bad margin in America? Yeah, sure. That has contributed to the margin in the Americas. Absolutely. Yeah. Was this also other issues behind that, or was the decline only FX based? Not only FX based, but that's a large portion. I think Samuel also mentioned that the margin also includes additional investment into enhancing our capabilities in the Americas and making sure that we are well positioned to serve our customers over there. Okay. On the Sholle comments you wrote in the press release, it was stable overall, but when I look at the growth rate in the U.S. for the whole group, it was really very strong, 7.4% organic. I imagine Sholle must have been strong there and hence weak in other regions. Can you give a little bit more color to that and explain why it is or what's happening in the non-U.S. regions that drive growth down and what drives growth up in the U.S.? Yeah, I think that's a good description of what we see. We're super pleased with especially how in dairy, bag-in-box, and food service in the U.S. we made progress, and you see it reflected in the growth rate for the Americas. The offsetting part came out of Europe, where they had to beat a very strong comp base from a machine sale perspective. Consumables did quite okay. As you know, we are in this transition from one-off sale into recurring sale of also equipment that obviously is a bit of a drag now and was now materialized in Europe's strongest, and that offsets part of the strong growth in the U.S. Overall, we are pleased with the consumable sales in the substrate. Right. Maybe a small add on here. Does it continue like that, or is this offsetting at some point? When does it end, this transition? I think we have a bit more impact this year, but I think it will eventually fade out. With 2026 we should have like a slight good base where growth could start again in Europe as well. Yeah, I mean growth can also happen before, but it's just from a pure transition perspective, you know, from one-off sales to recurring sales. That will be a headwind also into next year. The consumable sales is the one part that we focus on, and from that perspective we're very positive. The comments you made on dairy in the U.S. I think it was really interesting. Can you give an indication of how relevant that is or that has become? Yeah, I mean the food service growth that we saw in the first half now has become quite relevant. I mean you look at the growth rate for the entire region. bag-in-box has its fair share, and we're super pleased with the progress that we see on dairy bags that obviously help us to offer kind of more value-added products to our dairy customers in the region. We see good progress there. You know, the same we also see in Europe from a dairy bag perspective. It's just that it was offset from the one-off machine sales. Okay. My last question would be on cross-selling. You mentioned them as well, that it has continued I think one or two quarters ago. You also presented two very extensive slides. Is it possible to give a bit of an update on that? How many new products? Yeah, I think qualitatively, definitely we can maybe also deep dive a bit more on the CMD that comes up. You recall we had 39 projects that related to cross-selling wins. We had obviously more projects if you include all of them. 39 were cross-selling for the year 2023, 24, 30 in the year 2024. It's a very high number. Even if it's kind of only 20 that we get to, we would be very pleased. I can only say now for the first half of the wins that we have, we track very well in terms of total wins, spot on and number of system sales that we're going to place. We're very, very pleased to see the order intake for equipment not only for the aseptic carton, but especially also for these new substrates of bag-in-box and spouted pouch. Okay, thank you very much. Thank you. The next question comes from Joern Iffert from UBS. Please go ahead. Good morning and thanks for taking my questions. Also, I would have please three questions. We'll take them one by one if it's okay. The first question, please, if I may double click on the strong European EBITDA improvement. I mean among flattish sales, EBITDA was going up around EUR 20 million. You mentioned mix was a benefit, but can you give us some more details? What kind of mix exactly, and if there were any other benefits in this strong margin development in Europe. Good morning, Joern, thanks for your question. You know as well, and you also know that mix effect can vary from quarter to quarter, which is always a function of how the composition of orders look like and the customers we cater to. I think from a mix perspective, that was just simply a very strong first half for Europe, which is a function of those customers where we provide more value-added products that allows them also to fetch higher shelf prices. There was also a very strong production result in there. I think the efficiencies across the European plants were very strong. We were very pleased with that. That was work where the foundation was laid in periods before, and those together led to this very strong margin in the quarter in the half year. You said it's mixed trim, it can vary. You don't expect that this is the new underlying at the end of the day regarding your it can change from quarter- to- quarter? es, that can happen. Okay. Okay, the second question please. I understood the cash flow statement and the commentary you made, very helpful. When we look out into 2026, if you take the current spot rates, if you think a normalized growth environment, what is roughly the underlying clean equity free cash flow run rate you're looking for right now? Is this around EUR 250 million we should point or look for 2026 roughly ±, or is it closer to EUR 200 million, closer to EUR 300 million? How do you think about this underlying run rate on normalized net working capital swings? Yeah, thanks for the question. I would say 2026 is still a bit out too early to discuss this in detail. Of course, we look at it improving free cash flow year- over- year driven by operational improvements in EBITDA. We will also see this year slightly better interest expenses than in the previous year, and hopefully that continues also going forward. An improvement for sure, but a detailed number at this moment is by far too early to give. Thank you. The last question, just a small technical one. I think there was a EUR 7 million adjustment in the EBITDA also linked to others and ERP upgrade system installations. Is this a one off or is this also happening in 2026? Because these projects usually take longer. Correct. Let me also take us back to the time of the acquisition there. It was always clearly expected also that the system integration of the acquisitions will take place at a later point in time to make it as efficient as possible and as cost effective as possible also. That's why we see this happening now. The impact will largely fall into 2025, and we will also see a bit more still into 2026. Thank you. Very helpful. Thanks. Thank you. The next question comes from Benjamin Thielmann from Berenberg. Please go ahead. Yeah, hi, good morning. This is Ben from Berenberg. Three questions if I may. The first one is on Q3 and Q4, top line organic growth run rate. Samuel, you mentioned already that food service demand is a little bit mixed in the U.S. That's what I hear from other food and beverage packaging companies as well. You also mentioned that you are confident to grow across all the substrates and across all of the regions. I just tried to reconcile the numbers or get my head around because in 2024 your aseptic filler base grew by a little bit more than 3%. Your aseptic carton revenues didn't grow in line with that. I was just trying to understand what exactly is driving the growth in Q3 and Q4, as Charlie asked. Even if the installed fillers are growing, it doesn't mean that you're selling the same amount of cartons per filler, right. With bag-in-box, at least the non-aseptic ones, being somewhat under pressure in the U.S., I was wondering, is it fair to say that aseptic cartons will be the main growth driver in Q3, Q4? How can we think about bag-in-box? It seems like you're doing good progress for the aseptic ones. What about the other type of bag-in-box? Any color on that would be helpful. Absolutely. Thanks for your question, Ben. As I said before, I really expect kind of a sequential improvement quarter- over- quarter across all geographies and across all substrates. Now you're right. Obviously if you compare filler additions to growth rates, that does not always correlate. That's something that we always point out, right, because the much more significant driver is what happens in the end markets. Yet on top of that, it's effective if you put new fillers in place where we have good visibility and customers have all the incentives to sweat the assets that they can help to deliver incremental growth in a quarter or in a half year as we expected now for H2. If I look into the end markets, and we said it at the beginning of the year, we look at from an end market perspective as yet another transitional year where consumers' lack of purchase power just kind of impairs demand not only in food service, but also the same we see in retail. I think our growth rates in H1 in such an environment really prove the resilience of the business model and the success of our technology. I really would expect now into Q2, into Q3, Q4, sequential improvement across all substrates including bag-in-box, bottle, pouch, and carton. Okay, okay, fair. Thank you, Samuel. Maybe one more question. Go ahead. Any guidance you could give us on the planned filler placements for vacuum boxes and the spouted pouches? Because I think the 60 and 80 are referring to aseptic carton only. I know you don't report these numbers, but maybe is there going to be a short term impact from lower food service demand or should we expect the run rate we have seen over the last two to three years? The 60 to 80 relates to aseptic filler, which is a very established number we report on, and we expect to be in the range. We're very pleased to see that equipment in demand. I referred in the script to that, that we also see as a big driver, kind of the whole price differentiation that people use to come with differentiated prices across differentiated channels and use the volume flexibility as a tool to do that when it comes to bag-in-box, powder, pouch. As I said before, we're very pleased with the order intake year to date. Give us a chance to bring some more quantitative news on the Capital Markets Day so we can also deep dive into that. I would say we are pleased with the order intake also against the backdrop of the numbers that we have reported on for 2023, 2024 at the end of the year 2024. Okay. Okay, perfect. Maybe one last question if I may. I go back into the queue. Just quickly, a follow-up on the EUR 6.8 million adjustment on adjusted EBITDA we have seen in H1 in your report and Anna just touched on that briefly. It is saying it includes consulting costs for renewal of the group's IT systems, including the bag-in-box and spouted pouch system integration. How much of that EUR 6.8 million is referring to those consulting costs, if I may ask? The majority. I mean there's not much other in there than this one. Okay. Okay, perfect guys. Thank you very much. That's it from my side. Thank you, Ben. The next question comes from James Perry from Citigroup. Please go ahead. Morning. Thanks for the presentation. Just a couple I'd like to ask, first about the Americas. Looked like you had another quarter of good growth, and you referenced the strength in Mexico rather than the U.S. Are you able to roughly quantify the contribution of the new Mexico plant and how much impact you'd expect from that expansion in it? Secondly, on China, you described the market share gains in the soft environment, but are you able to give any more commentary on the actual customer behavior and how that's developed through Q2 and into Q3? You said that the growth in China is driven by a particularly large customer. Are you able to share roughly how large their contribution is? Thank you. Thanks for your question, James. On North America, on the Americas growth rate that we reported on, I think it's fair to say that Mexico had a very healthy contribution there. On the aseptic carton side, we are very pleased with the growth that we see in this market. I wouldn't pin that down only to the Mexican plant because the Mexican plant kind of serves the entire North American market, but I would say we had good progress with our customers in Mexico over the last couple of quarters and just see now the fruit of that work. The other part is that we also see consumer prices stabilizing, which gives a bit of an uptick in end market demand. We're pleased with the performance of Mexico. China. What we see in China in the H1 is obviously that it remains a subdued market environment, yet there's a lot of activity and a lot of things happening because our customers really do a lot to chase volume and to chase the consumer at the right price point. There were a number of new launches of products that really cater to the affordability price point. The big ones have improved the distribution capabilities into western China because many people that lost their jobs moved back into their hometowns so that they chased the consumers there. We also see deployments of fillers again. We will see more in the second half of this year, which I look at as a very positive sign as also the large customers and also mid-sized customers invest again into aseptic carton capacity, mostly related to innovation products or projects where they really aim for shape differentiation so that they stand out on shelves. I think there's a bit more activity in China happening right now than what maybe the growth rate of H1 will tell. I think it's still too early to say that the markets are back. I'm at least encouraged by the activity that we see. I think there was a point on the bag-in-box. I referred to that we started with one of the large players in the market also to fill aseptic dairy bag-in-box. We were super pleased. There it always normally goes the same way. You start with one line and they are too big to only operate one line. We believe there's much more to come. If you look at the Chinese food service market opportunity, which is still growing with all these tea and coffee outlets, we believe that's a very attractive market to be present in. We're very happy that we were able to establish a foothold there. Okay, thank you. Thanks James. The next question comes from Ioannis Masvoulas from Morgan Stanley. Please go ahead. Hello, good morning. Thank you for the presentation. Most of my questions have been answered. Just two left on the full year margin guidance. Just trying to figure out what's baked into your assumption. Do you expect to reach the low end of the EBITDA margin outlook of 24.5% even if spot FX rate persists, or is there a downside risk? I'll leave it here for the first one. Yeah, thanks for the follow up question. Our expectation that we formulate to be at the low end of the guidance range of 24.5% to 25.5% has of course been formed in the current market environment. That is factored in. That's very clear. Thank you very much. The second question, on Europe specifically, where margins were pretty strong and I guess it's the only region where you mentioned FX tailwind in the period, could you perhaps quantify on a margin basis how much of a tailwind that was in H1? Correct. Europe is the only region that enjoyed a favorable margin impact driven by the strong appreciation of the Euro. We wouldn't break this single impact out now, but it was a meaningful one. Okay, sounds great. Thanks so much. Thank you. The next question comes from Pallav Mitt al from Barclays. Please go ahead. Hi, good morning. A couple of questions. Firstly, on your guidance on the revenue guide, you are now saying at the. Lower half of 3%- 5% vs t his 3%- 5% earlier. What are the factors behind that slightly lower growth versus your initial expectations? Also, just a follow up on the EBITDA margin guide. Again, is it fair to assume that this small decline in margins that you are now expecting is just because of FX, or are there other moving parts behind that? That's the first question, please. Maybe I start. Thanks for your question. Maybe I'll start with the top line and you can complain on the bottom line. I think with regards to the growth outlook for the full year, that's just simply a reflection of the market environments that we operate in and what we see across retail markets globally and food service markets. I mean, while we, and we mentioned that on the call already, while we see some parts of the world where consumer prices are stabilizing, where disposable incomes are catching up, not yet to the degree we used to see them prior to the pandemic, there's still big large part of the world where growth remains very subdued. That's just reflected in our guidance. Obviously to some degree you saw that also in the growth rate for Q2, which again I view as a very healthy growth in the current environment. Yeah, and on the margin guidance. If you consider that we had in the second quarter a headwind from currencies on margin of 110 basis points and 60 for the first half, I believe it becomes pretty obvious that operationally we are really working into the right direction because despite such a headwind on the margin driven by currencies, we still see ourselves in the low end of the guidance range. On previous year's level, I think that speaks for the operational underlying improvement. Sure, thank you. Could you provide any update on the litigation with Lawrence last, because we haven't heard since? February on that, please. We can share obviously a bit what we learned also as part of this process. I think substantially there is nothing really to share other than probably with an update on the timeline. I mean, we also received an update from the panel on timeline, and I would say we can expect there an outcome towards the end of next year. Maybe that's the only real update that we can provide today. Other than that, there is no incremental news. Okay, thank you. The next question comes from Reinhardt van der Walt from Bank of America. Please go ahead. Hi, good morning and thanks for taking my question. I just want to call out one comment around Asia Pacific. You mentioned unfavorable sourcing. Can you just give us a little bit more details around where the drag came from? Yeah, we hadn't spelled that out specifically what material this just was, the overall mix of how we source between the aluminum, between the polymers, and the paperboard. There's not one that we need to flag out as it was the key contributor. Got it. Understood. Thank you. Maybe just sticking on that point of input costs. I mean, we've narrowed the EBITDA guidance range now, but you're still saying that input costs remain a swing factor. Can you just remind us the sensitivities in that EBITDA margin guidance to polymer and aluminum? Yeah. You have seen that in the H1 EBITDA bridge we see a favorable EUR 5 million impact on the raw material side. Right now our perspective is for the second half of the year that it's not going to continue to be support to the P&L. Let me also quickly frame why we did this. One sentence that we always include in the guidance is that our guidance is subject to volatility in raw material cost and in currencies. Of course, we expect from ourselves and from our teams that we would always manage smaller fluctuations. This is nothing that needs to be discussed. That's just a disclaimer in case we see really material changes. Of course, this is something that we would discuss on top. At this moment we don't see any reason why there should be any material swings in raw material costs coming. Perfect. That makes sense. Thank you very much. Could I maybe just get a little bit of early feedback on the alu-free barrier aseptic packaging product launch? What are you hearing from customers? Any sort of early market feedback? Absolutely. I mean if one follows us over the last couple of quarters, you see that we roll it out into more and more fields of application from an end product perspective. We started off in Europe in the liter pack with plain white milk, moved into kind of enhanced milks and now we were super proud to see it also launched with the full barrier version. Same shelf life in the high acid with high oxygen content. Obviously, vitamin content and high vitamin content is very sensitive to oxygen. That needs the full barrier version. We're super pleased to see that. I think the uptick and the growth rates, as you can imagine, are far beyond what the group growth is, so in the double- digit growth space and we're super pleased to see that while obviously for the entire group in terms of total share it's still less than 10% but we see the uptick continue and I believe, you know, with all these science-based target initiatives, approved and validated targets that many of our customers have, alu-free carton pack is one of their key contributors to hit the 2030 targets and I think that's well understood by our customers. We always talk about we need to bring it to cost parity because no one in this environment can afford to pay more. We make good progress there. I think when it looks to the liter packs, so the family size multi-serve packs, we are basically there. On the single serve, there's still some way to go but I'm sure in one way or the other we're going to solve that and then we believe that we'll be more driving, more uptick. We see it really across all end products or end markets from a category perspective as well as from a geographic perspective. Understood. Thanks for your question. The next question comes from Ephraim Ravi from Citi. Please go ahead. Thank you. Most of my questions have been answered. A couple of quick follow-ups on answers given earlier. Firstly, on the North America business, obviously. The U.S. is roughly half of that of the Americas. Can you split out the remainder? In terms of Brazil, Mexico and other Latin America? Because obviously you called out Brazilian Real as a key currency sensitivity, and related to that, is there like a mix effect in terms of margin? If you sell more in Brazil or Mexico, is it almost by definition lower margin than what you would get in the U.S. job? I mean we obviously don't comment on single countries. Right. I think all the magnitude, you're spot on. The Americas is kind of half of it, the U.S., and then the remainder is exactly driven by the large countries, the large market, which is Brazil and Mexico, and then obviously all the other Latin American markets. From a margin perspective, I wouldn't say that's a function of the country. I discussed it in earlier calls. We do see that we have higher margins for those solutions where we create more value for the customer because they also fetch higher shelf prices, have higher margins themselves, and the same goes for us. Mix is mainly driven by what eventually the customers feel in the packs and to what degree they use our USPs. Thank you. On the comment on a ramp up cost impacting margins in EMEA. Obviously, these are growth markets and there is always going to be a new plant that comes up. How do we think about ramp up cost? I mean, is it EUR 20 million, EUR 30 million. Per plant or is there a rule? Of thumb we can use? We don't, of course, put new plants in every country. That is very much focused investments, and a plant works across the region, right, because sleeves can travel also pretty well between different countries. I wouldn't expect that we now build a larger number of new greenfield sites in the next coming years. As a EUR 20 million- EUR 30 million ramp-up cost sounds very odd to me. That is a number that is by far too high UR 1 million that we should think about over a couple of quarters in total. Thank you. Thank you. The next question comes from Cole Hathorn from Jefferies. Please go ahead. Good morning. Thanks for taking my question. I'd just like to follow up on the growth profile from here. I mean, H1 has been impacted by kind of a muted backdrop, but as we go into the second half, we're starting to get some resolution on trade. When I think about the SIG Group's business, I imagine there has been a fair amount of down trading and some of the higher margin kind of on-the-go products. Has there been any early signs that kind of on-the-go, more premium, or smaller pack sizes are picking up? If we do see that increase, when do you expect that to be visible? Is that more of a back-end loaded dynamic? Also, have you seen anything from child care support in China supporting any growth? Thank you. Thanks for your question, Cole. I think from a growth rate perspective, we always were clear at the beginning of the year we see a slower H1 than what we expect for H1 now. We were very pleased with Q1 growth where we said that was better than expected. We also said we still haven't changed our view on H1 in total. I think what you see now is basically testimony to that. From here, if you look at Q2 into Q3, Q4, I really expect a sequential improvement driven by the new fillers that come upstream, driven by the fact that normally if H1 is slower, H2 will be a bit faster because people want to hit their volume targets. You bring up an interesting point. If I understand you right, you're asking whether we see after a period where it's all about affordability, whether we see kind of a mix change to more premium positioning that can help to fuel growth. The way I would put it is we don't see now that people launch new ranges of products that position on various premium price points, but we do see a lot of innovation that comes really in order to kind of fight for share of consumer stomach at the right price point. That also requires differentiation from us, as I just said before, very encouraging. Also the activities in China that we see there. We're not yet back to every launch the next level of premium product. We are back to the point or we do see that people really use innovation to fight for share of stomach for the consumer. I'd just like to go back to confirm some of the moving parts into the second half of the year. I just want to check I'm right in my understanding. Top line growth improvements, you will have partial reversal of the elevated SG&A costs. You should also have less of a ramp up drag on some of your machines in India and Mexico. I suppose the incremental headwind will be from FX on the adjusted EBITDA. Is there anything else that we're missing on the moving parts into the adjusted EBITDA for the second half? I suppose on the free cash flow, there's no rebate. Thank you. Yeah, with probably the small addition that the raw material cost might represent a swing from the positive contribution to a slightly negative contribution. I think overall that has captured it well. Just on top of this, the reminder that of course the second half of the year is always stronger sales wise, which then also translates into a better drop through because of better fixed cost absorption. That also needs to be considered. Thank you. Thank you. The next question comes from Jack Stonehouse from The Analyst. Please go ahead. Thank you for taking my call. It was just one on customer incentives because obviously this line item has historically been a nice cash inflow on a full year basis as customers have achieved higher volumes and rebates. How should we understand it sort of on a full year basis, are you expecting it to decline given the larger than expected outflow in H1, or should we see another inflow this year? Of course, in the half year you always see a negative impact because you only collect for six months, but you pay for 12 months. That is pretty natural. I believe at the end of the year we believe also that we will see a negative working capital. That's no change compared to a previous year. It remains a source of. Absolutely. I think that's the beauty of the business model, that we have the benefit of this higher payments during the year that gives this volume incentive. That's also explaining why we expect an acceleration of growth into the second half. Super, thanks. There's another basic question. For me, it's likely a function of my naivety than anything else, but I thought one of the benefits of leasing these machines is it effectively allows your customer to move CapEx to monthly OpEx payments. With that in mind, I'm just curious how you're able to receive such large advance payments, almost 100% of the value of the filling line. As you recall, we have different deployment models, right? Ultimately, the way we assess the attractiveness of a deal, and you remember we have deals that need to hit our hurdle rates, which is between 2-3 years payback dynamically, compared to an environment where obviously interest rates have raised a bit and input costs have changed. Obviously, our teams have to make an effort to make sure that they get the highest possible upfront cash in order to make sure that they hit the hurdle rate. They do an amazing job. In those instances where we collect 100%, that's normally where we bring in a leasing partner to the mix. That's a sale to lease to third party, where basically we get the benefit of the upfront cash and the customer has a financing solution. In general, across all deployment models, we were able to increase upfront cash, and that's a function just of the very stringent hurdle rates that we apply there. Thank you. A relatively large percentage of third party finance, is that how I should read that? That depends really on the mix. Third party financing is not available in all geographies. It's available normally in mature markets, and that's where it's a benefit to our customers because it allows them to grow obviously more capital light. It's a benefit to us because it gives 100% upfront cash. It really depends on the mix. I think we shouldn't underestimate the effort that the team did to collect more upfront cash by negotiating the better terms. Sure. The leasing terms. Sorry, I'll finish this final question, I promise. The lease terms are in line with the useful life of the asset at 10 years, or is it more like six years? The typical contract has an initial duration of 6-7 years, and we see that in 95% of the cases the customer also opts for a second lease term. With this, we cover 12- 14 years if you want, while the useful life that is assumed is 10 years. We have run statistics on the average useful life of our, the average life in service of the filler that we have, and this is also very well aligned. I think it matches pretty nicely. Super, thank you. Really helpful. Thank you. The next question comes from Manuel Lang from Vontobel. Please go ahead. Good morning. Three questions from my side. Maybe I'll stick with the first one for now. On India, you mentioned that it was negatively affected by weather-related effects. Do you anticipate a catch up already this year, or do you expect this to result just in a favorable base effect then as of next year? Maybe more broadly, how much of revenues does India contribute currently, and do you expect this like double-digit growth we saw in the past to continue? India, obviously, and we talked about that a bit earlier, we have seen now a higher share of dairy as we also always strategically wanted to position us strong in dairy as we are in the rest of the world. If I recall now the last five years how the ramp up went in India, we saw very good progress at the onset of our market entrance, also in the soft drink space. That's why naturally now we do a bit more on the dairy side, and the monsoon, the implication of what that means, you know, a stronger monsoon season is just that people stay home and then there is less on-the-go consumption for soft drinks. That's what we saw happened. I don't expect that necessarily to be caught up this year because the soft drink season is a more seasonal one and that's really kind of consumed during the hot period, and then it's a question how early the monsoon sets in. We are pleased with the progress in India. We do see good growth in the magnitude you mentioned, and it will remain a key contributor to our growth in the region of IMEA, but also ultimately for the group. All right, thank you. Maybe a more technical question or two of them. In the presentation you mentioned that SG&A had a negative impact on adjusted EBITDA margin, but looking at your P&L, SG&A actually looks quite unchanged against prior year. I'm wondering if you do any adjustments on these P&L items which we don't see. Also, on CapEx, given your lowered guidance vs at the start of the year, could you give any color on what items you expect to have lower investments? Between PP&E, filling lines, and payments of lease liabilities, that would be helpful. Thanks. Thank you for that follow-up question. The SG&A that you see in the financial statements also includes or used to include parts of the ONC PPA, which materializes also in SG&A. With the cessation of these amounts, just the reported number of SG&A naturally looks better. What we show in the EBITDA bridge is an adjusted view, not affected by any such impacts. This is the more clean operational view. On CapEx, I would say it's broad-based, not only from PP&E. We see ourselves trading at the lower end, but also from the filler CapEx, and at the same time collecting nicely upfront cash. I wouldn't now call out a single area that needs to be considered here. All right, thanks a lot. Thank you. The next question comes from Mengx ian Sun from Deutsche Bank. Please go ahead. Thank you very much. Also three questions from my side. The first one is on interest expense. We see a substantial improvement in the interest expense in the second quarter. Should we take the EUR 24 million as a run rate for the following quarters and any thoughts for 2026? The second question is a follow up on the SG&A. You expect a reversal in the second half of the year. Can you quantify the impact for us on the SG&A expense? The last question is on the trade tariffs. Regarding the 50% increase on the aluminum tariff, what kind of impact do you think will have on SIG? Have you already included that into your guidance? Thank you. Let me start with the aluminum one. The numbers that I mentioned earlier include, of course, all traffic that we have, whether this is for aluminum, and that's minor, or any other things that we ship from one country to another. For this year, we probably look at a low single-digit number still to come, million euros. A run rate for a full year would be a mid to high single-digit number to consider, encompassing all of the different components. On SG&A, the reversal into the second half, this wants to say that we don't expect to show again an EUR 18 million increase compared to previous year also in the second half. I would refrain at this moment from giving you such a concrete guidance on one item but would refer back to the overall guidance that we have given on the adjusted EBITDA margin to be at the low end of the 24%- 25%. On interest expenses, correct, the second quarter saw lower interest expenses. Overall for the second half of the year, we believe it's going to be on previous year level and basically here a net of the lower underlying interest rates and the higher financing cost of the new bond that we have raised earlier in the year compared to the old one, but on par with last year's second half. Okay, thank you very much. Thank you. The next question is a follow-up from Alessandro Foletti from Octavian. Please go ahead. Yes, good morning again. Thank you for taking my follow up. One question on Evergreen, we never speak about it. Can you say how it is developing, maybe even give an indication how big it is? We talked about that obviously on the earlier calls too. I mean we're very pleased post acquisition with the share gains and that in a growing market environment. Yet obviously China's dairy market growth did slow down and in some categories even turned into a negative growth. We always talked about the share gains that we experienced there and that we were able to deliver there through the better service, better quality that SIG offers. We also talked about the cross-sell wins that we continue to see obviously between chilled customers that adopt now the aseptic technology. That's the much more common pattern than the other way around. We were also able to continue to expand the chilled a bit more into the Southeast Asia region, but it remains, I mean, a very China, Korea, Taiwan focused business. Overall, I would say we're pleased with the share position, but obviously we operate in a more difficult market environment from an end market perspective. Was it not helpful during this difficult time to have before it went down with the market? No, it was as obviously we were able to grow faster than the market, right, and that led to the share gains. You might recall also we were very clear from the beginning that we aim to increase the share through better service, through better quality. Better quality is also a function of the new plant that came on stream mid last year that's now in full swing and that did help. Obviously, yes, it's always against the backdrop of the substitute end market in China. Okay, then my last follow-up on the margin again, particularly in the Americas. The margin in the Americas is now under pressure since several years from memory, maybe even seven, eight years, and it seems to be always due to foreign exchange. What can you do or what are you doing to fix that? Yeah, I mean if you go back as far as you just referred to seven, eight years, you might recall there were ups and downs, and yes, normally saw one direction, but we always were clear that an input factor for pricing is not only input cost from a material perspective, but also currency. That has always been a tool that we use there. Now, particularly in the current period, it's mainly an FX topic. Okay, the margin went down like 10% from the, I mean 10 percentage points from some periods where it was. You know, this is really, I don't know, maybe you just cannot increase the prices enough to offset all that. No, but Alexandra, recall the biggest impact came obviously from the business combination. I mean 60% of the Scholle business is in the Americas, right? Actually over 60%. 60% is in the U.S. and then a bit in Latin America. That was the last? Yeah, yeah. Okay, so this maybe half explains half of the 10%? I don't recall now exactly the impact, but that was the largest impact. Now we have the currency. If you see, we know the margin always was also a function of improvements following our initiatives that we drove there. Okay, okay, good. Thank you. Thank you. Any other questions? Yeah, we now have a last question from the phone from Miro Zuzak from JMS I nvest. Please go ahead. Yes. Yes, hi, good morning and congratulations to the good margins in this harsh FX environment. That would be also my first question. You still, I think, have the midterm guidance out there larger than 27%. Is this impacted by the transaction effect of the FX movements? The midterm guidance remains the midterm guidance and we absolutely see the potential of the business to achieve this 27% EBITDA margin. We see margin improvement potential across all substrates, not only in the acquired businesses, but also in the legacy carton business. Is it now short term smaller setback that we see because of the currencies at this very moment? Yes, but we are very confident that we can develop the business to the above 27%. There's no concern on our side here. Okay. The second one, if I may, and please apologize if it has already been asked, could you please provide an update on the open issue with los t in terms of whether there is any progress that you could report or also give us an indication on the timeline from today's perspective. When do you expect this issue? Can we close the issue? We gave an update on the letter because it's the only incremental information we have. In substance, we cannot give further updates as there was no further progress yet. On the timeline, I think from a two days perspective, we need to expect that we get an outcome towards end of next year, end of 2026. Okay, thank you. Thank you. I think, Ingrid, you have some questions from the webcast, right? Yes, correct. We have one from Lars Kjellberg of Stifel. Speak to a good project pipeline in Europe. What about the other regions, and how do projects translate to organic growth in 2026? We do see good projects across all geographies. I talked about China before that. We also see an uptick there again, which I read very positive. We also said the expectation for the full year though is within the range of 60- 80, probably rather below the 70. We said that, you know, after kind of two, three years of elevated filler placements. I think it's not a surprise when we actually expected that frankly to happen earlier. A bit of a slowdown in filler placements because there is so much capacity in the market and end market demand remains subdued. I think on the aseptic carton side, very much in line with our expectations across all geographies. When it comes to the spouted pouch and bag-in-box, also there I would say naturally still higher wins in terms of number of lines in geographies where the business is already much more established, so in Europe, in the Americas and maybe a bit less in Asia. Yet we do see very good progress as I singled out one win there also in China where we deployed now aseptic dairy pack in box with a large player. As I said, you know, they normally don't run just one line, but they go in and want to be big in whatever they do. We're super pleased on their progress. That's also really a cross culture. Who is and all substrates then now what that means for the growth rate into 2026, as also discussed earlier, and you recall that, Lars, our growth rate is not simply a function of fillers placed in the prior year, but also what end markets do. We will form a view there once we get closer to 2026 and then provide a full year guidance with the presentation of the 2025. His final question, please remind us that the factors supporting your mid-term margin target are 27%. Yep. The 27% as mentioned before will be driven by margin improvements across all substrates, and I would consider especially the following building blocks. Number one, of course, is further growth, and with further growth, better fixed cost absorption and a better drop through. In the operation supply chain area, for example, we introduced lean manufacturing excellence into the acquired plants and also have one-off costs for ramp-ups fading out towards the end of the midterm period. Last, but really not least, that's an important point on innovation. Not only that we launch new products, of course, at higher margins, on the innovation front it will also be key to drive the aseptic technology application in the acceleration substrates. We have discussed that a couple of times, that aseptic as a high-tech solution always commands better margin than non-aseptic packaging businesses, and that will, of course, also drive the overall margin mix. Those are the key building blocks I would have in mind at this moment. There are no more questions on the webcast and I think from the operator we heard before, no more questions on the call. Let me say thank you to all of you for your time today. We really appreciate that. I hope we're going to see all of you at the Capital Markets Day that comes up at the very onset of October. Dates are published and we would love to see you there. It's going to happen in Zurich and with that we wish all of you a wonderful summer and look forward to catch up soon. Thank you so much for your time today. Ladies and gentlemen, the conference is now over. Thank you for choosing Coruscall and thank you for participating in the conference. You may now disconnect your lines. Goodbye.