Good morning, ladies and gentlemen, and welcome to the Carl Zeiss Meditec AG Analysts Conference, 9 Months 2023-2024 results. At this time, all participants have been placed on listen-only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Sebastian Frericks, Head of Investor Relations. Hi everybody, welcome to our analyst call. With me, as usual, is our management, our President, CEO Markus Weber, and our CFO, Justus Wehmer. They will guide you through our financials with some prepared remarks, and afterwards we look forward to taking questions. Now I'd like to hand over to Markus. Yeah, thank you so much, Sebastian. Also a warm good morning and welcome from my side, ladies and gentlemen. Welcome to the 9 Months 2023-2024 Analysts Conference of Carl Zeiss Meditec AG. Let's have first a brief look at our agenda. I will start off with an overview, as usual, of the results, and Justus will give more insights into the financials. Following that, we would like to provide deeper insights into what we are doing about cost control measures and some details around recent order development. Finally, we'll update you on the outlook for the remainder of the fiscal year 2023-24. Afterwards, as usual, we will be very open for your questions. We discussed the business situation for the first eight months in mid-June. The third quarter results reflect what we shared with you when we lowered revenue. Revenue and profit are both under continued pressure year-on-year due to restricted investment climate in the equipment markets, as well as weaker consumer sentiment in our elective business continues to create headwinds for our business. It's the first time that DORC was consolidated in the Q3 numbers. Please note the reported numbers all include DORC in the slides. So coming to revenue, revenue in nine months, 2023-24, was down -1.5%, correct me, -1.5% to EUR 1.487 billion, adjusted for currency effect. It was almost stable at EUR 1.510 billion. Currency headwinds mostly came from RMB, USD, the U.S. dollar, and the Japanese yen. DORC contributed EUR 53 million revenue in Q3. Excluding DORC, organic revenue was EUR 1.434 billion, down by -5% year-on-year. So both equipment and consumables demonstrated a sideways trend. The restricted investment climate continued to put pressure on equipment, especially in North America, as we have said in particular in June. The decline in consumables is still primarily due to the destocking of refractive treatment packs until March 2024. There has been a relatively soft start to the summer peak season of procedures in the Chinese market in Q3, as well as some delays in the implementation of IOL volume-based procurement, leading to a more unfavorable consumable mix share than we had initially planned for. However, recently, there has been at least some stabilization happening as we speak in our order intake. The book-to-bill ratio stabilized and reached slightly above one in Q3 after being below one for several quarters. EBIT amounted to EUR 163 million, a significant -34% decline year-over-year, which contains DORC indeed of around EUR 4 million. Justus, we'll talk about the DORC contribution in just a moment. EBIT margin was 10.9% and down from 16.2% last year. Excluding DORC, the organic EBIT was EUR 159 million with a margin of 11.1%. Adjusted EBIT was EUR 161 million with a margin of 11.2%. In the adjusted margin, we split out the DORC EBIT contribution. DORC integration costs, one-off payments and amortization on PPA of earlier acquisitions. The main reasons for the steep decline in EBIT were the revenue contraction and resulting lack of operating leverage, as well as the mix as I've already mentioned. We've kept the trend sideways thanks to the strict cost control measures we have implemented. Our net income dropped by -42% from EUR 205 million in the prior year to EUR 180 million due to lower EBIT and weaker financial results, with reduced FX hedging contribution in the reporting period. Earnings per share fell to EUR 1.32. Now I would like to hand over to Justus, who will provide you with more background and will discuss the figures in more depth. Yeah, good morning and welcome also from my side. I'm now going to give you a more detailed overview of our financials, starting with the performance of the SBU of Ophthalmic Technologies. Revenue of OPT dropped by -0.8% to EUR 1,143 million. At constant currency, it slightly increased by +0.7% to EUR 1,160 million. The number contains DORC revenue of EUR 53 million. Excluding DORC revenue, OPT dropped -5.4% to EUR 1,090 million. Underlying top-line contraction was reflected in both equipment and consumables. In equipment, we saw the drop most clearly in the diagnostics and optometry microscope categories, above all in North America. With consumables, the completion of refractive consumables destocking in the Chinese sales channel, weaker refractive consumables consumption at the beginning of the summer peak season, as well as some delay in implementation of volume-based procurement of IOLs, the main drivers of the softness. By making further progress in the expansion of the installed base of VISUMAX, we will provide more insights into the development of refractive procedures in China later. Due to volume-based procurement for IOLs, there's additional pressure on revenue and earnings due to the volumes coming in later than initially planned. On the cost side, OPEX were almost flat. Due to the revenue weakness, OPEX ratios continued at a high level despite significant cost containment measures. As a consequence, gross margin and EBIT margin were down significantly year-over-year by minus 5.5 percentage points to 8.5%. Let me address the first contribution from D.O.R.C., which, as we had announced previously, we will adjust out of our EBIT performance as it is counted for our target achievement this year. D.O.R.C. had EBIT of EUR 4 million at a margin of 7.3% in Q3. At the time of the acquisition, we projected a D.O.R.C. operating margin in the mid-teens%. Importantly, the difference to what we are reporting in Q3 post-consolidation is mainly due to some accounting changes. Firstly, we are following a much more conservative R&D capitalization policy, leading to a reduction of around a couple of percentage points in reported EBIT margin, as for example, certain product registration expenses under Zeiss R&D accounting are not being capitalized but expensed directly. Due to the relatively large amount of capitalized R&D on the DORC balance sheet, we are now continuing the depreciation charge at around EUR 2 million per quarter, which is essentially for money that has been spent before the acquisition by ZEISS. It is a pure non-cash accounting effect. Secondly, there are a couple of non-recurring issues in the numbers that we expected to be positioned for under the purchase price allocation, as it will be finalized towards the end of the fiscal year and will therefore be EBIT neutral in the coming quarters. We estimate that without these changes and impacts, a comparable DORC EBIT margin would have been around 12%-13%, still a bit lower than we see it on a full-year basis. The purchase price allocation is expected to be finalized in the fourth quarter. The Q4 financials will, for the first time, contain an amortization charge, which we expect at around EUR 15 million-EUR 20 million as of today. The annualized amount from fiscal year 2024, 2025 onwards will be between EUR 19 million-EUR 40 million. The number might still change as this is only a preliminary status. As we had previously announced, we will adjust it out of our EBIT as it relates to guidance achievements. Let's go to microsurgery. The continued investment reluctance in the markets has also led to weakness in MCS fields. Supply dropped -4% to EUR 344 million. At constant currency, it's a -2% drop. In particular, in the categories of dental and neurosurgery business, we saw the most impact. High financing costs played a role, both for private hospitals with leverage, as well as for some of the dental customers who are affected by more restrictive lending policies. We see these effects mainly in North America. Also in European markets such as Germany and France, political and regulatory uncertainties in the healthcare system have contributed to a slower than usual order intake pattern. As we said in June, we are seeing the current weakness in some of our competitively strongest areas, such as neurosurgical visualization. Competitors are not making any major moves at the moment either. This reassures us that what we are seeing has likely nothing to do with shifts in market shares, but rather possibly a combination of restrictive macro factors with a market that has been relatively well saturated during the COVID years, as a large backlog of previously queued-up equipment has been delivered. We do not know exactly how long this environment will persist, but historical patterns show that these markets typically do not stagnate or even go down for very long, particularly not if there's enough innovation coming down the pipeline, as in our case. As a consequence of the lack of operating leverage, both gross margin and EBIT margin have fallen back despite a flat OPEX development and a reversal from the stronger picture at the beginning of the year. EBIT margin dropped by 4.2 percentage points to 19.2%. By regions, EMEA demonstrated good top-line growth, while Americas was under the strongest pressure. Americas noted sales of EUR 357 million, a drop of -13% at constant currency -12%. Business is still largely held back by the high interest rate and difficult financing environment. It's worth mentioning in Q3 solo order entry returned to positive after being weak for several quarters. This seems too late and not yet strong enough to create anything like the recovery we had previously counted on for the second half, but it still signals to us that the U.S. markets will likely not be down any longer for an extended period of time. In EMEA, we noted revenues of EUR 432 million, an increase as reported of +16% and at constant currency +19%. Core markets such as Italy, Spain, and France continued showing strong performance but benefited from backlog delivery, which peaked in Q2. Order entry in France and in Germany in particular did weaken over the past few months due most likely to some political and regulatory uncertainty in the healthcare system. In Asia-Pacific, we achieved revenues of EUR 698 million, which moderately dropped by -4% at constant currency -3%. India and Australia contributed a robust performance. China, including Hong Kong, developed slightly down as a consequence of weaker consumable sales, as we explained before. Japan and South Korea also moved sideways. Let's have a look at the P&L lines. Gross margin was 53.7%, was 3.6 percentage points below previously a level due to less operating leverage, unfavorable product mix, and additionally foreign exchange headwinds mainly from renminbi, U.S. dollar, and Japanese yen. OPEX, excluding D.O.R.C. and D.O.R.C. integration costs, were slightly down in absolute terms year-over-year due to strict cost control measures. I will talk more about this a bit later in the presentation. OPEX ratios remained high due to the revenue weakness. Consequently, reported EBIT of EUR 163 million was significantly below previous year's level of EUR 245 million. EBIT margin was 10.9%, behind previous year's 16.2%. In adjusted EBIT, we made a number of changes. Let me walk you through each one. Under amortization of PPA, we will factor out the previously mentioned amortization charge for DORC that will kick in in Q4. To be consistent, we will group this together with the ongoing amortization of PPA arising from past acquisitions such as Aaren Scientific, IanTECH, Katalyst Surgical, and Kogent Surgical. We also adjust for the one-off top-line payment, DORC reported EBIT, and cost of DORC integration. Adjusted EBIT amounted to EUR 161 million, similar to reported EBIT figure, but minus 36% below previous year's EUR 253 million. Adjusted EBIT margin was 11.2%, minus 5.6 percentage points behind previous year. We had already announced previously that the impact of the Topcon settlement, as well as the DORC contribution to EBIT, the PPA charge on DORC and the DORC integration cost, would be adjusted out of the guidance. For the remainder of the year, we will now base our outlook on adjusted EBIT as defined in this table instead of reported EBIT. We previously not meant to exclude the PPA charges for historic acquisitions from our target achievement, which amount to EUR 7.5 million in Q3 and roughly EUR 10 million in the full year 2023/2024. We do not wish to be moving the goalposts, but rather try to keep things simple. Therefore, we will move the guidance range from June news release to a revised range that is EUR 10 million higher, but based on the logic of this adjusted EBIT formula. This EUR 10 million adjusts the value of the PPA charges from historic M&A that previously had not been adjusted under our outlook, but now will be. There's no underlying economic change to the outlook. We will reiterate this again at the end of the presentation when we discuss the outlook. Now, let's look at the cash flow statement. Operating cash flow declined to EUR 58 million. Previous year was EUR 103 million, mainly due to lower earnings and higher tax payments. Investment cash flow includes the changes in our treasury account. It is positive at EUR 19 million, as we have withdrawn most of the liquidity from the group treasury to pay for the D.O.R.C. acquisition. CapEx were relatively high after nine months at EUR 116 million versus EUR 77 million in the previous year, due mainly to the expansion projects in our consumables production, for example, at our La Rochelle, Guangzhou, and Katalyst sites. Change in financing cash flow was mainly due to issuance of shareholder loan, dividend payment, and share buyback. Under the share buyback, we have invested around EUR 108 million as of June 30, 2024. Net liquidity was at minus EUR 24 million and refinanced through the Zeiss Group treasury. Net financial debt, including the shareholder loan from Zeiss, was at EUR 424 million. Now, let's move to the key topics, and I'll start with the first one, which is the topic of our resilience initiatives. Since the beginning of the fiscal year, we have been implementing what we call a resilience program, meant to tactically adjust expense levels depending on where we are in the market cycle. As we had to realize that a recovery of the equipment business was delayed, we meaningfully ramped up the short-term resilience measures during the third quarter. The target of these initiatives is to secure a minimum target achievement even in difficult markets and to focus on critical topics to improve the efficiency of our P&L and the chance of becoming effective near term. The focus is on reducing discretionary spending, reducing R&D expenses by reprioritizing our project pipeline, and bringing down external spending. We will continue with a highly selective hiring policy with the goal of keeping overall headcount relatively flat into next year. Regarding financial impact, we are targeting an annual amount of structural OPEX savings in the low- to mid-double-digit EUR million area, believing that there are efficiency improvements addressable. We have involved external consultants who are doing some work for us on the DORC integration to advise on the cost optimization and transformation initiatives and will share further updates with you as we move into next fiscal year. For the mid- to long-term transformation initiatives, let me then pass it over to Markus. Yeah, thank you so much, Justus. Let's come now to the mid- to long-term initiatives. Mid- to long-term, it is our goal to use the current situation to drive the company towards better productivity in a variety of fields. Let me walk you through them. In the area of operations and supply chain over the last three years, we had to operate in an area of unprecedented tight supplies. We have managed to achieve supply continuity at all times, which was not easy, but it did not come at a cost. The cost of goods sold has risen due to the necessary insourcing. At the same time, in a different type of economy, we do not need all the capacities that have been set up in recent years to deal with the high demand during the pandemic. We have a target of protecting our gross margin developments by reducing the cost of goods sold. In the field of innovation, we see good progress over the last five years with meaningful product launches such as our entry into premium hydrophobic IOLs, the launch of our first phaco and IOL in the U.S., the launch of VISUMAX 800 in many countries, including the U.S., this fiscal year, as well as four new products in microsurgery coming next fiscal year. With the ZEISS Medical Ecosystem that powers our clinical workflows, we are reshaping digitalization in the ophthalmic industry. However, R&D budgets have risen significantly as well, and as a consequence, we constantly measure R&D productivity and need to ensure best possible productivity of these large investments. Therefore, we are currently performing a thorough analysis of all our key projects and will make some resource allocation adjustments if needed to ensure highest returns on the portfolio in the utmost focus on the critical value drivers. This all goes to commercial. We seek to adopt an even more agile go-to-market strategy to launch new products, price our products smartly, and also offer the customer increased flexibility. All of this will help us to deal with the currently difficult market environment and speed up the pace of future product introductions. Please be assured that these initiatives will have the highest priority for us as we move forward. Even as we strongly hope for markets to be more supportive in fiscal year 2024-2025, we are currently preparing for an all-weather kind of scenario. Looking into the current environment, I would like to share a bit more detail with you than we usually provide before transitioning to the outlook. The numbers in the chart on this slide do not include DORC. We can clearly see that during the COVID years, order entry was significantly inflated. Therefore, it seems plausible that some saturation post-COVID has kicked in as we delivered a very substantial backlog of equipment orders into customer's hands. We have had about a year and a half of weakening order entry and negative book-to-bill. Notably, based on the most recent data, this seems to be bottoming out now. The book-to-bill ratio has recovered to slightly above one. Both ophthalmology and microsurgery have experienced similar effects. We are still seeing a gap versus the previous year in revenue, but the forward indicators now look more stable than they have in quite some time. So now, finally, let's move to the guidance. As we discussed in last investors' call in June, our revenue target remains unchanged to this EUR 2 billion. Additionally, DORC is expected to contribute around EUR 100 million in the second half year. Adjusted EBIT is expected to reach a range of EUR 225 million-EUR 275 million. As reported earlier, adjusted EBIT after nine months was EUR 161 million, factoring out the Topcon effect, D.O.R.C. contribution, and D.O.R.C.-related integration costs, as well as PPA from legacy acquisitions and in Q4 first time from D.O.R.C. Because these PPA charges from legacy acquisitions were not adjusted for in our previous guidance, but now will be after this change of method, we have raised the range by EUR 10 million, the amount of the adjustable PPA charges to EUR 225-EUR 275 million. We will continue on strict cost control to further reduce sales and marketing and R&D expenses, as discussed by Justus, to achieve a low to mid double-digit million reduction in structural OPEX before D.O.R.C. integration. In the midterm, the transformation initiatives will help us to improve our productivity and thereby enable a new phase of profitable growth once the markets eventually turn around. With that, we have come to the end of our prepared remarks in the financials. Let me pass it back to the moderator to take your question. Thank you so much. Thank you very much. Ladies and gentlemen, we will now begin the question and answer session. If you would like to ask a question, please dial 9* on your telephone keypad. If you find your question is answered before it's your turn to speak, you can dial 9* again to enter your question. So the first question comes from Oliver Reinberg of Kepler Cheuvreux. The line is open. Oh, yeah. Good morning. Can you hear me? Yes, we can hear you. Yeah. Oh, yeah. Perfect. Thanks so much for taking my questions. If I may, just from China, can you share with us what kind of volume growth in terms of treatment you have seen so far in the kind of key summer period on an actual basis and also on a like-for-like basis here, just for the installed base? That would be question number one. Secondly, on DORC, I mean, noting a bit of a softer margin point here, and also now you talked about involving consultants to streamline the kind of cost base here. Initially, the understanding was that this is kind of very simple integration work. So can you just give us a bit of flavor? Is there anything like you figured out that's more negative in DORC? And also, what is now a kind of reasonable margin assumption for DORC next year on ZEISS accounting standards? And then secondly, on the mid-term margin outlook, I'm not sure if it's just the wording. I think you now talked about about 40% sustainable margin in the past. You were shooting for more. I'm not sure if that is the change. And can you just confirm, does it also apply now still for reported EBIT, or does it now move to adjusted EBIT as well, considering that you have this kind of PPA charges coming from D.O.R.C.? Thank you. Yeah. Thank you, Oliver, and good morning from my side. I think Justus will take these questions and answer to you. So overall, maybe just before we go in the financials, so we see for D.O.R.C., actually, as you said, so currently, the integration work is well ongoing, I would say. For sure, at the beginning, we have always some turbulences, but currently, we don't see any deviations, which has been unexpected. So from this point of view, I think everything is on track. But as you said, the integration work is always a big deal, but we are very well prepared. A big team is working on that, also with consultancy support. Okay. Oliver, Justus here. A couple of comments on China. Look, I'd say year to date, and you know that we are just basically in the middle of the summer peak, so it is a little bit too early to tell, but at least at this date, I think we can still confirm that we see in terms of RTP consumption year-over-year growth that is obviously nourished by the bigger installed base compared to the last year. But frankly spoken, and you heard us saying this here, we have been off to a somewhat slower start of the summer peak, and only after the summer peak, we will ultimately be able to answer the question of whether we will have year-over-year coming to the end of this fiscal year. We will then have a growth. Therefore, please understand that I'm still a little bit reluctant to give here any predictions at this point in time. So we are simply a couple of weeks too early with this call today to have the full transparency on the magnitude of the summer peak. On the DORC integration, no, there are no surprises whatsoever, and we have a snapshot here with the first quarter. As we have said, there's on the one hand side some accounting effects that, however, we were well aware that this would incur once we are in the consolidation moment because we have a more conservative perspective on, especially on the capitalization of product registration costs. Then we had some non-recurring issues with supplies from vendors to DORC that were delayed. Therefore, I think we shouldn't take too much or read too much into these first numbers. You were asking about what is in our expectation for the DORC margin in the future. I think a mid-teen number is a reasonable assumption as is. Then obviously, on top of that, we are then in the process in the future to take the synergies, being it on the market and sales side or being it on the organizational side. But also, to clarify, it's not that the consultants that we have engaged for the PMI; it was something that was clearly part of our plan and preparation. It was nothing that was kind of the result of any sort of findings or disclosures after the acquisition, but that's simply because we want to have a diligent and successful PMI process. However, them being already on board and knowing our strategy and knowing the synergy portions that we want to explore, we felt it was only sensible to use now these consultants to also advise us on our further cost optimization projects. And last but not least, in terms of the EBIT margin guidance, yes, of course, in order to maintain some sort of clarity and transparency, it will be to the adjusted EBIT margin referred. And as you were hearing, right, at this point in time, we want to give basically a guidance that is indicating that we are on our path to return to the 20% EBIT margin. And yes, we are guiding here about 20%, but that does not take away that we stay to the original target of sustainably above. But right now, we just want to show and indicate the track back to that. So I hope that covers your questions, Oliver. Yes, perfect. Thank you very much. Next question comes from Graham Doyle, UBS. Your line is open. Good morning. Thanks, guys. Just ask two questions. So firstly, for microsurgery, when you think of the slowing order intake there and obviously the very strong numbers in the first half, how good do you feel about finding a baseline demand for 2025? And do you think you sort of have that now because you've seen the stabilization? And then just on China refractive, could you give us a sense as to how the potential shift of the pressure that we're seeing a little while ago in terms of the switch to LASIK, how that's playing out over the summer as well, just to get a sense as to what we think about next year and the potential for a restock in the first half, whether we would see a full sort of EUR 55 million benefit or maybe something that gets eaten away with LASIK? Thank you. Yeah. Thank you very much. Good morning, Graham. And so I will take the first question and most likely the second question, Justus. Do you want to take it? Yeah. Okay. So microsurgery, so Graham, I think this is in microsurgery, as you know, since we have a significant market share in the market, especially also in North America, we have a very, very good transparency of the trends in the market. And so what we have seen is that overall, the interest of our customers, especially for our new innovations like the PENTERO 800, but also the activities and instruments and so on. So we see that there's a high interest and that the sales funnel is very well filled. So as Justus stated already, so there has been a saturation over COVID. We have seen that there's a super high book-to-bill, which was very unusual, especially also in the equipment business. And now we have seen also that in a similar amount, then there was a saturation in the market. At least this is our evaluation assessment about this. So having this said, so we see currently a stabilization, as Justus said, and also positive order entry. Again, we see that we are still gaining market share. So that means vendors coming in. The win-loss rate is even higher for us as in the years during COVID. So all of this is good news. And as we said, the innovation pipeline is, thanks to our R&D investments, very well filled. So there will be new innovations coming, which will definitely then also foster and leverage the market again. So from the microsurgery point of view, we strongly believe that the next fiscal year will be a reasonable year without now looking too much in the crystal sphere. But overall, we feel very well prepared, Graham. Yeah. On the questions on China, I think in a nutshell, what we see is the price pressure remains in the market, and that shouldn't be any surprise to you. We do see a gradually higher ratio of LASIK, but not significantly. So basically, that trend that has continued, but continued on a single percentage point level towards LASIK. Yeah. But nothing that is dramatically changing in the future versus the previous quarter. Okay. Thank you, guys. Next question comes from Dylan from Stifel. The line is open. Thank you. So just one follow-up on Graham's question. Just on the mix, is there also a mix shift between SMILE and SMILE pro? I was just interested to hear if there is, let's say, traction here given the mix implications. And then maybe just a question on the book-to-bill number that we got. Are all orders entered into book-to-bill, or is that also excluding shipped orders? Because I know that sometimes these numbers can differ. Yeah, I'll just keep it there if there's a follow-up or something. Dylan, first question on the mix shift. Now, SMILE pro is not yet really dramatically relevant here, especially in China, because the VISUMAX 800 is yet to be launched in China. And with the VISUMAX 800, then there will be the SMILE pro modality. So from that perspective, given that the Chinese summer peak is here, the meaningful component in what we are discussing, that doesn't have any impact here. Book-to-bill, frankly, I was not sure whether I fully understood your question, but we are typically taking in all orders that we receive without any specific corrections or adjustments that you were kind of alluding to. So that, I think, is the simple answer from my side. Yeah. Perfect. Thank you. And maybe just to then SMILE pro, or at least VISUMAX 800, is launched in Korea, right? And could you maybe comment on the traction in their market, maybe as a proxy for what is ultimately maybe flattish volumes, but maybe positive mix because there is a premium implicated, right, to be created from SMILE pro? Yeah. So Dylan, very well observed. So we see a good resonance on the market for SMILE pro, especially, as you said, as a premium procedure. And this goes also along with a good price stability. So we can really keep the prices here. So overall, we see positive momentum. And our expectation is that in the countries where we are introducing SMILE Pro, that this has a positive momentum in the countries, not only in terms of market share for the premium procedures, but also in terms of pricing and pricing stability. Excellent. And just maybe finally, just on VISUMAX, is there still sort of an order book number you guys have? Because I think the number was roughly 100 in China, and I think, or was it 50 in China and another 50 international? Is there an update on that number? Frankly, now you caught me, but I'd say, and we can confirm, and you can follow up with Sebastian on that, but I'd say by and large similar. Yeah. So we still see a higher order entry, Dylan, on the VISUMAX. And that's also something that interplay between utilization and new installs. That's also something since we have so much orders coming in from China and other countries that then to drive up these systems, that has also kind of dilution on the utilization. And that's something what we see currently since our installed base is significantly growing. This is something we will see in especially the next months and quarters how this then actually transforms into utilization. Thanks. Next question comes from Sam England from Berenberg. Same question too for me. So on the weaker equipment sales in North America in the ophthalmology segment, do you think the declines you saw were in line with the rest of the market? I know you said the sort of decline in equipment sales in MCS was in line with the market, but wasn't the same in ophthalmology. And then, how much have the Phaco expansion plans in the U.S. been disrupted by the sort of equipment selling issues and how you think about the long-term opportunity there? And then the second one was just around the mid- to long-term resiliency initiatives. I just wondered whether your goal of getting back to over 20% now relies on efficiency or cost savings to get back to that level. If we see a recovery in U.S. equipment sales and China refractive consumables, would that be enough to get the margins back to that 20% level? Thanks. Yeah. So good morning, Sam. So I think the first question maybe you take the second one, Justus. So coming to ophthalmology market, yeah, we see similar patterns, but it's a bit more complex since we have much, much more competitors in the market. These competitors are also actually established in different market segments and niches. For instance, in optometry, Topcon is more on the optometrist level. We see these different variants. Overall, we see similar patterns when it comes really to a one-to-one comparison in terms of the markets. I think this is definitely the case. Please be aware of, for instance, that we have now just relaunched our CIRRUS 6000, which has gained a lot of market momentum now, especially in the last months. From this point of view, this is something what we see positive. Overall, we see that the market is currently, especially in equipment for the U.S., very, very soft. Again, I think we see similar patterns as in microsurgery, that there is at least currently a recovery. How long and how sustainable the recovery is is really hard to predict. But currently, we see that this is a positive element. And it depends the most likely also on the elections and on the things happening here in the world. On the phaco side, so what we currently, and this goes along this talk, what we currently are actually, we have now the broadest portfolio when it comes to phacos. And this is something what we leverage now since DORC and the EVA NEXUS is a combo system that's actually completing our portfolio and brings us in a perfect position also in actually to win against competition. That's the reason that DORC has a significant high backlog, especially also in the EVA NEXUS. And we are ramping up, as Justus said, to make sure that the supply chain is working and to make sure that we can leverage this close. So this is one of the synergy activities what we currently do. So that means we will actually put then our full phaco strategy for North America in place by next fiscal year then, when also the sales forces are aligned and trained. So all of these activities are ongoing. And that's the reason also that currently now to say what is the current status of DORC is currently really tough to say because we are currently really in that alignment of the activities, the incentive models, so everything what is necessary actually to bring sales and marketing online. The same is true for R&D and also operations and supply chain management. As you can imagine, there's a lot of synergies what we can leverage. And the team is very motivated and excited to make it happen. Yeah. On your question on resilience as a contribution to bring us back to the 20% EBIT margin, I mean, in order to get back there, we will have to have both. We will have to have basically cost efficiency and operational excellence. This is exactly what we're trying with the Resilience Program and with the transformation projects that Markus was talking about. That will clearly give a contribution to our recovery, but we also need the growth on the top line. The fundamentals of the markets that we are in remain, from our perspective, all healthy as drivers for further growth. The business model of going to these workflow solutions, including the consumables and DORC being the most recent addition to that strategy, clearly for us indicates that this path can be continued to be pursued. Once these what I would still call post-Corona distortions of supply chains and of customer buying behavior, once they have overcome and we come back to a more steady state, then I think both top-line growth and the resilience/efficiency from our operational excellence will contribute to that. Great. Thanks very much. Next question comes from Falko Friedrichs, Deutsche Bank. Thank you and good morning. My first question is on guidance for this fiscal year. Considering where you stand on adjusted EBIT in the first nine months, is it a fair assumption that the lower end of your adjusted EBIT range is a little bit more realistic now, or do you still believe that the full range is perfectly doable? And my second question on your incremental OpEx savings, these low- to mid-single-digit millions, did I understand it correctly that they should have a full effect next fiscal year over this year? So that's the full incremental benefit that you expect next fiscal year. And my last question is on the VBP rollout in IOL. Can you briefly update us where we stand here with it, and how many provinces sort of have it been implemented, and how much is going to go there? Thank you. Yeah. So maybe I'll start with the third question and then hand over to Justus. So the VBP, I think as far as I know, it's a single-digit number of regions currently which has already adopted. And we see positive effects in these regions in terms of volumes. It's clear that overall, the price erosion is part of the VBP, but we see also that our share in premium has been shifted, as I already noted. So that means overall, we expect to have the rest of the regions adapted to that in the next six months roughly, but it depends also on the authorities in China. So overall, I think our VBP strategy is running as expected. Also in terms of price and positioning, we see higher volumes coming in and higher unit numbers. And this is something what we currently handle more to come. But it's clear that's a new setup. And actually, the entire industry of the market has to settle down first before we really clearly see what the consequences are. So far, I think we are here on track. Yeah. Falko, your questions on guidance, actually, thanks for the question. You're totally right. I would say mid to lower end of the guidance is the more realistic assessment that I can see. Why is that? Of course, the summer peak that started softer is a first indication that would put me here on the more conservative side in that assessment. Secondly, and that's the unfortunate seasonal pattern, the U.S. device business typically has this very, very back-end loaded pattern of September being the decisive month. September in the U.S. can easily be almost a factor 2 of a regular sales month in our year. And obviously, with the uncertainties of the U.S. development, you just heard saying that there are some indications of stability. And here and there, even I'd say some optimism is probably appropriate given the recent development. So that 2 things must kick in, and then we may be closer to the midpoint. But being here more conservative at this point, then I'd agree with your assessment. Lower end is more realistic. On the incremental optics, well, there's two sides to it. Obviously, whatever we do in this Resilience Program will already help and contribute to this year's guidance achievement, as you can imagine. In the next year, however, we will then have basically a new list of measures that we are going to implement, and that will contribute to our target of ideally a continued sidewards development of optics. But again, that all will be gauged somewhat with the overall market development. And then we basically take the, how should I say, the severity of measures to be taken in dependence of the developments in the markets. Okay. Thank you. Next question comes from Jack Reynolds-Clark, RBC Capital Markets. Hi, thank you for taking the questions. Two for me, please. You talked about strong growth in EMEA. Could you just talk through which categories you're seeing the most strength? Is this kind of market-level strength, or are you seeing share gains here? And then the second question was just around capital environment in the U.S. So some kind of other subsectors talk about kind of relatively strong demand in medical equipment. So what's kind of causing the weakness on the ophthalmology side compared to these kind of other areas? Thank you. Yeah. So maybe I'll start with the second question and then come to the first one. So as we said, we see currently, and you're totally right, I think there are different elements in the market, by the way, the same as what we have seen during Corona. Maybe you remember that. In Corona, especially the consumable business has been more down, and equipment business was up. This is exactly what I would rate also when I'm looking here now to the U.S. markets. There are some fields which are driven by special trends and also by treatments and procedures which can be not shifted, like for instance, now retinal or also tumor treatments or something like this. This is exactly what we see here. We see that also, and this is an indication, for instance, in DORC. We see that the recurring business in DORC is very stable and is growing. This was one of the reasons that we have acquired DORC, and that's one of the reasons that we are converting now more and more in a consumables company. We really want to leverage these two elements. And this is exactly the reason for the strategy, also for the initiatives what I have presented to you to the mid- to long-term, because we have now the full portfolio. And the plan is to leverage this portfolio then also with the consumables-based approach. And DORC is working here also for us as a catalyst where we can learn and where we can use this as a seed. So from this perspective, we believe that we can leverage this. As you said, so in the U.S., we see in some parts now, for instance, for OCT, we see a strong growth with the relaunch of the CIRRUS 6000, but we actually proven that this is sustainable. The other one is the strong growth in Europe. I think we see that in different elements, not only in equipment, but also in consumables. Overall, I would definitely say that we are not losing market share, but we are rather winning market share as far as we can see that. So overall, we see the positive momentum, but also here it's a country-to-country thing. So we see some countries very well performing, other countries also with local legal implications or changes in the healthcare system. We see then other countries are not performing so well. So this is really something which comes down from country to country and then depends also on the different categories and elements here. But overall, we see that Europe is pretty strong for us, and we also don't have these currency headwinds, which are, for instance, favorable, especially for the Japanese competition when it comes to U.S. That's it. Thank you very much. The next question is kind of a question from David Adjemian from Equita. Yes. Hi, good morning, everybody. I have two questions. So I will start with the first, and then I will follow with the second. Looking at the evolution of your R&D, it's already a third quarter in a row of a sequential decline. In the third quarter, you booked EUR 84 million R&D, which was below my estimates because I was assuming the consolidation of DORC as well. So I will understand, first of all, how much out of these EUR 84 million R&D comes from DORC and what we should expect going forward if you will stay at such a low level of R&D. Thank you. Okay. David, thank you for your question. So maybe first, so we don't see that our R&D activities are on the low level. Maybe to make that clear, David, I think the opposite is the case. We are on a high level also in the benchmarking to different competitors in the industry. So I think we are definitely leading here. That was a deeper discussion also here in the conference, in the earnings calls in the past. So it's clear our R&D is on a high level. What we have done now is actually that we have frozen our R&D growth in that way that we don't want to further increase our R&D investments. Now it's really important to make sure that our innovations or our products are coming as innovations to the market. That's exactly what we do, these activities bringing now the commercial excellence activities and innovation excellence activities. So we need to make sure that our strategy, what we have also presented to you, these initial workflows, this workplace and workflow strategy, these acquisitions, all we have done, also this Katalyst and Kogent. So all of these things are coming together, and this is now something which you will see in the next years that this will get momentum. The second question. A nd just what has been the second question? Can you repeat the second question, please? No, I didn't ask yet the second question. The second question is, when you target mid-term and EBIT margin above 20% at the group level, then what do you have in mind regarding the ophthalmic devices and microsurgery margin? In the sense, because higher competition in ophthalmic devices and also some pricing pressure, for example, coming from VBP in China, is it a fair assumption to assume in ophthalmic devices mid-term your margin will stay below 20% in the region of high teens, while microsurgery will run at a higher level of profitability? Now, by and large, David, I would say that is probably a reasonable assumption. And again, it is probably a little bit early to tell because, as you know, we are driving our workflow strategy across all our businesses. And that means that we strategically always want to increase the portion of consumables and recurring revenues. But for your calculation, I'd say that is probably a reasonable assumption for your model. Thank you. Next question comes from Oliver Metzger, ODDO BHF. Oliver, the line is open. No, I'm muted. Sorry for that. Good morning. First question is on visibility. So obviously, it has come down massively in both divisions. And your communication suggests that we see return to a better potential somewhere in 2025. So is your confidence just based on macro assumptions? And what does prevent you that the recovery might not kick in in 2026 and not earlier? And also all the measures you mentioned target primarily on the bottom line. That's correct, isn't it? Second, it's also clarification and the add-on to Davide's questions. So can you confirm that your order book microsurgery has basically eaten up strongly during the last quarters? And last one, it's on China. Can you describe your expectations for refractive if the economic crisis in China remains as it is? So would you describe your expectations for demand also as more muted and what's brought the underlying demand in such a scenario? Thank you. So maybe I take the question one and three. Just as we talk about the order book. So Oliver, first, good morning. So visibility in terms of what will happen next year. So first of all, so we are an innovation-driven company. So our target is to be a technology and market leader. That means we are working on new innovations so that we can gain in the market. It's a profitable market, as you all know, that we gain market share here and that this is very profitable for us and sustainable. So this is the reason that we have invested so much in R&D in the past, much, much more than competition, and that we are very actually we are expecting and very hopeful that this investment is paying back. Is it now something where we can tell you it's a 26 or 25? I think we see I think we see currently some indications that the market is turning back to growth, but this will be more manifested in the next three months. So this is, I think, by the end of the fiscal year, most likely we will see much, much more whether this is sustainable or not. Also, only depending on what kind of macroeconomic effects are kicking in because currently, with all the things which are happening in the world, it's really hard to say what can be helpful, what is not helpful. We have seen also a high currency effect this year. So it's really hard to predict what next year will bring also in terms of currency. So all of this is really tough to say. But the positive element is really, and this is something you can take with you, is first, I think our innovations are in place, so more to come. And secondly, so we see already positive signs that the market softening is reducing and is maybe coming back to growth. In terms of, and this is what Justus said, I think we are really actually we have started already with our resilience measures already last year. And we have different stages. And we started last year with the first stages, now with the high momentum coming in in the market in the last couple of months. Actually, we then adopted our resilience. And as you can imagine, such a big company has a given inertia until the things are getting traction. This is what we see now and what we see especially now for the last quarter and the quarters to come. In terms of China refractive, first of all, we believe that the market is not saturated yet. So that's, I think, quite important to say. So myopia is the most severe, let's say, issue when it comes to ophthalmology, apart from cataract and other things. But now in these market groups, and especially in Asia, but also in Europe, myopia progression is something which is increasing. And from this point of view, the market is a strong one and is increasing. I think there's also a pressure then for our customers in the market group actually to go for these treatments. So overall, I think that's intact. Currently, the consumer climate is really under stress, as we all know, especially also in China. I think there's other companies which are facing much, much more issues as we currently do. I think the critical part will be also here again that we will lead with innovations. If we don't have these innovations, there will be also local players coming up in the mid- to long-term future. So all of these things, and this is something we can win on the one hand with innovations, on the other hand with localization, but also with a strong sales force combined with workflow solutions which offers a full solution and a safe solution to the users and to the customers here. I think we are really very well established and also equipped here. So from this point of view, you will see how this is progressing. We see currently strong, as you said before, still a good order entry coming in, especially also from China. There's definitely untapped market potential that we want actually to reach and to leverage. Yeah. And maybe lastly, your question on the MCS order backlog. Yeah, I think I can confirm that the majority of the backlog for MCS has been consumed. And I think that was your question, so I can confirm on that. Yeah. Yes, it was. Thank you very much. The next question comes from Alexander Galitsa, Hauck. Yes, thank you. I just have two short ones. On R&D, I think previously, I think that in light of the ongoing prior itazation of R&D projects, there might be potential write-offs. Can you provide an update on that? Whether we should expect anything here? And second, I'm not sure if you can talk about it with regards to the share buy-back program. What has been the average cost base? Thank you. Yeah, I can take those questions, Alexander. So no information on write-offs at this point in time, too early to tell. And so that remains to be decided at a later point. On the share buyback, and now I really need Sebastian to help me. I think your question was, what was the average cost base? Right, Alex? I think the information is on our website. I can actually send you the information afterwards, so you also find it on our investor relations website. Yeah. Yes. I'll take a look. Okay. Thank you. Sorry for that. And now we have the last question. So if you want to ask a question, please dial in with nine-star on the telephone keypad. The last question comes from Anchal Verma from J.P. Morgan. Hi. Good morning. Thanks for taking my questions. I have two questions. One on D.O.R.C. Can you please clarify when you expect the margins to reach mid-teens? Looking into next year, in terms of contribution at the EBIT level, do you expect positive contribution from DORC on a net basis? Second, you mentioned all the growth has returned positive to Q3. Can you please provide any color of the orders recently, especially around the U.S. and China? And then the last one is on cost savings. So you have new product launches coming out. How will you balance the sales and marketing spend required for new launches versus cost savings? Hi, Anshu. So on the DORC clarification, you were asking about when do we think we will reach this mid-teens margin. I think that we will see that you have to know that they have a more back-end loaded fiscal year with their fiscal year so far identical with the calendar year. So I would say we will see that then going into the first quarter of our next fiscal year that we come into that level of EBIT margin. The question on the EBIT acquisitive growth, I think that clearly is then a function of the synergies being exploited both on the top line as well as on the cost line. And therefore, there is clearly some dependence also on the market developments. But overall, I would think that over the course of the next calendar year, if those things are all developing per our expectations, can be achieved. Order growth, I think, was it by region or was it by products? I think the order yeah? Regions, please. Regions, please. I think, as we said, it's pretty much across the board. But then again, with very distinct developments if you go on country levels. But generally spoken, we have seen order growth across EMEA, across Asia-Pacific, and across the U.S., compared obviously to the lower first half of the year. And the cost savings, you were basically asking the trade-off between product launches and cost savings be assured that we will not cut basically the branch on which we are sitting. Yeah. So if we have a launch that we need to staff or that we need to invest in all associated marketing collaterals, then we will obviously do that so that you can take for granted that on the other side, we believe still leave some room for, let's say, surgical adjustments. Perfect. Tha nk you. So we have a question from Richard Felton, GS. Thank you very much. Just one for me, please, on 2025. Based on what you're saying today about FY24 EBIT, there is quite a big gap up to where current consensus in 2025 sits, which I think is currently around EUR 380. So my question is, clearly, there's a lot of sort of initiatives on what's going on. So do you feel like you have good visibility on a path to reaching that level of EBIT that's currently in consensus for 2025? Or does a lot still depend on the overall market environment getting better into next year? Thank you. Yeah. I think your second half of your question or statement already gave the answer. Yeah. I think, as we said, yeah, the Chinese market recovery plays a major role for that equation and obviously also the U.S. recovery. So therefore, I think, as you just said, uncertainty is still unfortunately too high to give you now a kind of a comfort level confirmation. Yeah. So as Mark has said, let's see how we close the year, how sustainable and solid the current indications that we see will figure out. And then it will be a lot easier coming December once we have the next earnings call to give you a somewhat more qualified answer. Thank you. And now we have no more questions. Thanks to the host for the conclusion. Thank you very much. Okay. Thanks, everybody, for joining our call. And look forward to conversations with you in the next week and maybe see some of you at the conferences. Everybody have a nice summer break and speak to you soon.