Hello, everyone. Welcome to our virtual deep dive for analysts and investors. In July 2018, I had the pleasure of moderating a conference call titled, BASF Investigates Establishment of a second Verbund Site in China, shortly after the signing of a memorandum of understanding in Berlin. Eight years later, BASF's Zhanjiang Verbund Site is operating successfully following a flawless startup in early 2026 and the official inauguration in March. Before we begin, I'd like to provide some organizational details on today's conference call. The call is being recorded, and all participants will be in listen-only mode throughout. The presentation will be followed by a question- and- answer session. The presentation contains forward-looking statements. These statements are based on current estimates and projections of the Board of Executive Directors and currently available information. Forward-looking statements are not guarantees of the future developments and results outlined therein. These are dependent on a number of factors, they involve various risks and uncertainties. They are based on assumptions that may not prove to be accurate. BASF does not assume any obligation to update the forward-looking statements contained in this presentation above and beyond the legal requirements. With me on the call today are Markus Kamieth, Chairman of the Board of Executive Directors, Stephan Kothrade, Member of the Board of Executive Directors and Chief Technology Officer, as well as Haryono Lim, President, Mega Projects Asia, and as of July 1st, President and Chairman, BASF Greater China. I would like to hand over to Markus. Thank you very much, Steffi. Welcome everybody to our deep dive on Zhanjiang, a topic that we all have talked about a lot over the last year. I'm really happy to have a bit of time with you to answer your questions and also introduce the site to you. We have recently opened Zhanjiang as our seventh Verbund Site in BASF globally. This is the first Verbund Site opening since 2005, where we opened the last one in Nanjing. We'll talk about this in a second. The Zhanjiang investment marks BASF's largest single investment globally in our history and the largest investment by a German company in China. At the peak of construction, more than 35,000 people from over 150 companies worked at the site. As Steffi said, we completed the project on schedule below the original budget and started up the project in- line with our expectations. Let me take you back a little bit to the history of BASF in China. BASF has a long history of over 140 years of doing business in China. We started actually our production in China in 1969 with our first manufacturing site. It was roughly the time when we opened our Antwerp site in Europe. We are certainly one of the longest invested chemical companies in China. Since then, we have consistently increased our presence in Greater China in line with our local-for-local approach, which we follow already for quite some decades. In 2025, the proportion of sales from local production in Greater China accounted to around 80%. We sourced around 90% of the required input factors locally. Today, BASF operates 29 production sites and has 28 major wholly owned companies. We are partnering in 12 major joint ventures in the country. Overall, 12,500 employees help to generate sales of EUR 8.2 billion with customers in Greater China. Please keep in mind that this number, EUR 8.2 billion, does not include the roughly EUR 2 billion of sales generated by our main joint venture in China, BASF-YPC Company Limited, which is a 50/50 joint venture with Sinopec operating our Nanjing Verbund Site. We consolidate or we account for this participation at equity. The EUR 8.2 billion sales number does not account for this. On the slide, you can also see that we have consistently delivered volume and earnings growth in Greater China. Between 2015 and 2025, so roughly over the last 10 years, sales volumes in Greater China have grown at 6% on a compounded average annual basis. Profitability, as measured by EBITDA before special items, has grown on average 11% per year. The performance has been stronger than in any other region for BASF. Now, let me turn for a moment to the macroeconomic environment and China's role in the chemical industry. We overall assume that the chemical production globally will grow at a rate of around 2.8% per year in the timeframe of 2025 to 2030. This growth will be predominantly driven by Greater China, which is expected to grow by 3.7% per year. If you look at the middle of this chart, I think these are some remarkable numbers. If you look at the share of Greater China in the GDP industrial and chemicals growth, you can see that one-third of the global GDP growth, roughly half of global industrial growth, and three-quarters of global chemicals demand growth will come from Greater China in this time period. This growth will be supported by robust domestic demand based on an expanding middle class with rising income and through export-oriented industries. Greater China is and will remain the largest chemical market in the world, and already today accounts for 55% of global chemical production. I think its importance for the chemical industry cannot be over-exaggerated. On the next slide, you can see that the absolute growth, if you take this from a relative to an absolute growth perspective, the absolute growth in the chemical market in Greater China is expected to be nearly 3x higher than the rest of the world combined. All other regions will grow as well, at least to our estimates in the timeframe 2025 to 2030. I think it's fair to say, when you look at these numbers, that the growth in China certainly will be unmatched by anything else that we see in the rest of the world. This is why we have decided to invest into a second Verbund site in China. Now, the overall environment also politically is certainly providing us with some confidence that also the next years will be quite successful years for BASF. If you look at the political environment that comes through China's 15th Five-Year Plan, you can see that this creates a very favorable framework for companies like BASF. Our local scale, cost competitiveness, and especially our innovation strength foster long-term value creation. In addition, our broad portfolio means that we can grow by creating tailored solutions for our customers. We today talk about the big manufacturing site, but let me also remind you that in Shanghai with our innovation campus, we have over the last 10 years now established a significant and our second-largest innovation center globally for our chemicals activities in China. This, in combination with our strong EHS reputation, certainly gives us a strong credibility to develop future solutions for our customers in China. Our strong commitment to sustainability supports the targeted transition of the Chinese economy to a low carbon and circular economy. In this regard, the Zhanjiang Verbund site shows what the future of chemistry will look like, is a smart integrated Verbund structure on an industrial scale, efficient, digital, and sustainable by design, and you will see this in more details going forward. Lastly, let me focus on the location and why we chose to invest this Verbund site in the south of China, namely in the province of Guangdong. Historically, BASF has grown significantly in the east of China, so we had more than 90% of our assets in the area around Shanghai and Jiangsu Province. More and more, China's economic growth has moved south and Guangdong is actually as a province today, the powerhouse of the Chinese economy. With nearly 128 million residents, Guangdong is the most populous province in China. Also in terms of GDP, it is the country's largest province with Jiangsu Province, which is home to our Nanjing operations, ranking second. To put things into perspective, the GDP of Guangdong is roughly equivalent to that of South Korea or Spain. The projected GDP growth of around 4% per year in Guangdong will be driven by industrial investments of important BASF customer industries such as transportation, consumer goods, home and personal care, as well as electronics. It includes, of course, the strongly growing, let's say, area or economic zone around the Pearl River Delta, including Macau and Hong Kong. In a nutshell, Guangdong province is one of the economic growth engines of China, and it acts as a powerhouse for BASF's key customer industries and provides fast-growing demand for innovative chemical products and solutions. Until today, Guangdong as a province is a significant net importer of chemical products, and we assume that the strong economic growth in the Guangxi, Guangdong, Fujian, and Hainan provinces will, at the end of the day, stipulate a strong and successful future of our Verbund site in Zhanjiang. With this, I hand over to Harry and please take us into the journey of the Zhanjiang site. Thank you very much, Markus. Let me virtually bring you to Zhanjiang and explain to you a little bit about what is so special about the location, Zhanjiang. The location is exactly on this Donghai Island. This is over excellent geographical advantages, I think, thanks to its proximity to fast-growing industrial centers in Guangdong and the surrounding provinces in South China. For those of you who have never been to Zhanjiang, we are located on the western part of province Guangdong, and today you could reach us via high-speed rail train from Guangzhou just in one and half hours. Our site has a direct access to the deep water seaport. I think this is very important to us to run the Verbund because with the access to the deep seaport and operate our own jetty, we are able to bring in large-scale raw material and as well as using the waterway to ship our finished goods to our customers. The location itself also offers the shortest sea routes between mainland China and the Southeast Asia market. In addition, Zhanjiang has a rapidly evolving industrial ecosystem, enabling future synergies with co-location partners and co-producers. Next, I would like to give you some statistic about our site in Zhanjiang. Impressive statistic here. We have a size of 4 sq km, 400 hectares, since we are approaching the World Cup, this is roughly 550 soccer fields, just for you to compare to the soccer field. As Steffi mentioned at the beginning, in early 2026, we have successfully started up our entire Verbund, including the world-scale flex-feed steam cracker. As of May, we have started producing and also run successfully 19 of our plants and 33 production lines. One more plant is coming, and this will be commissioned in 2028. This is the tridecanol plant. This is also on schedule. The total investment, as you know, it is amount of EUR 8.7 billion. This is the CapEx that we spent on the period of 2019 to 2028. As for the value chain, we have this Verbund location with the upstream and downstream. That give us an advantage also to manufacture a broad product portfolio. It is not just the cracker or cracker plus one, we call it the cracker downstream, but we have more products to offer. Through the integrated approach, we create a value chain for ethylene, propylene, C4. After Ludwigshafen and Antwerp, Zhanjiang is the third-largest Verbund for BASF. Today, we are employing around 2,000 people working at the site. As a key platform for the long-term profitable and sustainable growth of BASF in China and Asia, the majority of the products that we produce in Zhanjiang will directly serve customers in China particularly. This is fully aligned with BASF local-for-local production approach. Allow me also to share some key success factors for our Zhanjiang Verbund site. Running such a mega project require high commitment to safety, quality, and also compliance. At the peak of our construction site, we have more than 35,000 people working for BASF and more than 150 companies working at our site. It is utmost important that we are committed to the safety and the quality of our site, making sure that not only the BASF employees, but also all our partners, they are giving us the same commitment as well. This is important to make sure that we have a very, very strict discipline in our executions, making sure that the timeline, and as well as the CapEx, are well under control. What is also important for us for being a greenfield in China, that we are also managing the interfaces with authority and partners extremely well, making sure that any issues that we have identified are also being addressed speedily. Of course, at the end, it is also about the people. We are very proud that our team has executed this complex task with outstanding dedications and speed and exceptional level of commitment. This is just a couple of points that I want to highlight to you to summarize what we see as a key pillar for success. Important is that we have started the recruitment processes very early at the beginning of our project, knowing that to get the right people and to train them and to qualify them to run such an important Verbund for BASF, that requires time and also sufficient training for our staff. We are fortunate enough that in China, we are operating many sites, especially with our experience in Nanjing, our Verbund site in Nanjing. We are able also to train our colleagues in various production sites in China as well. What is impressive for us to make a comment here is also about the commissioning and startup as well. Running a Verbund is always a complex task. It has a chance if it works, but at the same time, we know that if anything doesn't fall into places, that may also create a lot of complexity and stress. We are very happy to see that with our comprehensive commissioning plan, we are able to start up our plants in sequences and achieve steady state operation already today. The next slide that I want to introduce to you is also about our smart Verbund. This is also very unique opportunity for BASF for being a greenfield, that we are able to bring our visions to life. That with the digitalization and innovations, we are able to even get additional synergies what already the Verbund could deliver. We apply state-of-the-art digital solutions that are seamlessly integrated and enhanced with big data and artificial intelligence. To achieve this, we implemented a best-in-class digital infrastructure and are leveraging 5G and cloud services, for example. To make this more tangible also, let me have some showcase for some features. We are trying for our Verbund site to be paperless. We have implemented fully automated real-time integrations, and we have more than 8,000 utility measurements. We have AI-driven automations. If you see today in our site logistic, AI agents already automate 95% of outbound delivery processes across multiple systems. With the help of digitalization, we are moving from reactive to proactive. A digital assistant leverages BASF data, analytics, and AI to spot supply disruptions at early stage. With all that, our smart Verbund vision has become reality. Something that is fascinating for me also as a chemical engineer. Based on this excellent foundation, we will continue to innovate. We are at the right place in China, where today, AI, automation, robotics are very much on the front page of our activities. Here, we hope that we will continue making use of this opportunity to drive our Verbund even to more sustainable operation. The next slide is about our unique cracker setup. Here, I would like to highlight that with the access of the deep sea port that we have, we are able also to bring the key cracker feedstock to our site. Also what is important to highlight here is that in Zhanjiang, with our 1 million metric ton of ethylene flex-feed cracker, we are able to process quite broad varieties of feedstock like naphtha and butane. This will allow us to produce key raw material for our value chain, ethylene, propylene, crude C4 reliably and efficiently. Furthermore, this setup also allow us to optimize feedstock and to strive to achieve low cost. It is remarkable also that we are utilizing 100% renewable energy today for our entire site. One big contributor to this success is also the innovation that we apply here for our cracker, that we drive the main compressor of our cracker, also known as an E-drive, using 100% renewable energy. In conventional cracker, typically, those big compressor turbines are driven by steam generated and using the natural gas and cracker fuel gas. Also, we make use of the surplus cracker fuel gas and CO2 off gas produced by downstream plant like ethylene oxide. We are using those fuel gas and CO2 off gas to produce our syngas, which is again, important raw material for our downstream like for the oxo alcohol. Not only just utilizing the E-drive, but we also make sure that the so-called heat integration of our entire site is really at the top-notch, because with this heat integration, we are able to optimize further our site and reduce the CO2 and therefore less fossil feedstock to be used compared to other sites. The next slide I want to give you a little bit of our sustainability journey here in Zhanjiang, especially also to explain to you how are we able to bring our carbon footprint or reduce our carbon footprint more than half than conventional petrochemical site. With the Verbund concept, obviously we have already efficiencies and what I mentioned before about the heat integrations, that obviously also contribute to the lower use of the fossil fuel. With the E-drive, using the 100% of renewable energy for the entire site, obviously this all contribute to bring down the CO2 emissions for our site. How are we able to do that? I think to secure the renewable energies today, we have three main sources. One is we have a joint venture with Mingyang for offshore wind farm located 80 km south of Zhanjiang. This is currently under construction and has a planned capacity of 500 MW. Then we have also the second sources is from the power purchase agreement that we have signed with partners like State Power Investment Corporation, SPIC and GEDI. This is a long-term supply contract for 25 years. The third one is, we also install wherever we can on our site, the solar panels that contribute also to the green energy source for our site. With this, I would like to hand it over to Stephan. Thank you very much, Harry. I would like to continue with an overview of the value chains and products of the Zhanjiang Verbund site to illustrate a little bit what the differences are between our site and the typical big sites you see in China from our competitors. First of all, you know we have this Verbund set up, our Verbund production system that makes us more resilient because it's also less dependent on externally sourced precursors as we produce the vast majority ourselves. It provides us with cost advantages. It's also important to highlight here that whilst most of our competitors focus just on two, three, four major commodity-type products such as polyolefins, ethylene glycol or PTA, we have a very diversified product slate here. Of course, we also produce polyethylene and ethylene glycol. We need these products as scale enablers to achieve economies of scale and cost benefits, and also to have more flexibility. The strategically relevant products are more diverse. Let me go through the three main value chains, starting with C2 ethylene. Ethylene oxide is a very important raw material for us because we produce surfactants and even precursors for brake fluids on our site. Last year, during the Investor Update in Antwerp, we showcased the BASF EO value chain. Just to repeat a little bit, we are technology leader and also offer the lowest CO2 footprint with our downstream products because of lower energy consumption and a high raw material yield. We also have the best safety technology in the industry. This is a very strong foundation of this value chain. When we come to the propylene C3 value chain, this is the basis for our acrylics business, acrylic acid and oxo alcohols. These are used to make further products, mainly for the adhesives and coatings industry. Oxo products are also the feedstock for specialty intermediates. One by-product is isobutyraldehyde, that is a basis for neopentyl glycol, an intermediate that I will talk about in a couple of minutes. When it comes to the crude C4 that we get out of our cracker, here we extract isobutene, which is the starting point of the citral value chain to produce aroma ingredients and vitamins. Now, in addition, we also have at the site, engineering plastics compounding facilities and a plant for thermoplastic polyurethanes which both serve the automotive and electrical industries in South China, but are also used for sports shoes and sports equipment. Now, building on this product slate, I would like to show you on the next few slides, some examples of customer success stories that show how our local-for-local production approach and the breadth of our customer industries works and plays into our hands. Here it is also very important to notice what Markus has highlighted, that we have a strong R&D footprint in China at our Shanghai campus that allows us to co-create with customers. Let me start with one example, the partnership with Youyi. You are all familiar, of course, with adhesive tapes from your daily life, but I would bet that most of you have not heard the name Youyi. It is definitely not a household name, but Youyi is a globally leading adhesive tape manufacturer that operates around 20 production sites in China and has a very strong market presence. It is a vertically integrated player from polypropylene film to the finished tape products. They have been a partner for us for many, many years. Actually, we started our business with them from our Nanjing Verbund site, and now with the new Zhanjiang Verbund site in Guangdong. We also follow the production footprint of Youyi, because they also built a new, large-scale production plant in South China, not far from our Zhanjiang Verbund site. From a customer perspective, we offer here a long-term, reliable acrylate supply. We talk about butyl acrylate and 2-Ethylhexyl acrylate, and we reduce the import dependency in South China for these products. With our leading cost position in acrylics, thanks to our proprietary BASF technology and the favorable cost position offered by the site set up, we are here the partner of choice. This customer alone purchases the production volumes equivalent to one world-scale butyl acrylate plant every year. Our Zhanjiang Verbund supplies more than 50% of its BA and 2-EHA production to China's fast-growing adhesives and tape market, which has a compounded annual growth rate of around 11%. This was an example from our Petrochemicals division. Let us move on to the Intermediates division. Here we have a success story around neopentyl glycol or NPG that I mentioned already. It is a key ingredient for powder coatings that are low VOC, low volatile organic compound coatings for a wide variety of applications, ranging from garden furniture to infrastructure elements. For instance, all the big construction parts you see at airports are typically coated with powder coatings. To capture profitable growth, we have also built a world-scale NPG plant at the Zhanjiang Verbund site. NPG is expected to grow at around 5% per year on a global scale, and Asia Pacific is by far the largest market, and it is also the fastest-growing region with an annual growth rate of around 6%. Now we are again close to our customer. Here, the company, Huake. It is one of the top-ranking producers of the saturated polyester resins that are made with NPG and then used for powder coatings. We signed an agreement with them to supply them from our new plant. Again, here we have the same pattern. We have been, for many years, a strong partner based on our production in Zhanjiang, at the Zhanjiang Verbund site, and now we replicate the success and tap into the market potential in South China. To give you just a number, Huake recently expanded its production capacity by 150,000 tons to almost 400,000 tons. Quite a relevant customer for us. Let's move on to a different kind of product. We talk about Ultramid and Ultradur, our engineering plastics based on polyamide and PBT. Here it's again relevant to emphasize the co-creation aspect, co-creation in innovation with customers from our innovation campus in Shanghai. We hold the number one position in engineering plastics globally. Asia Pacific continues to be our largest and fastest growing market. For us, it's important to penetrate new application segments through innovation. Here the company, Orient Motion, a very dynamic, fast-growing mobility tech startup from Suzhou in China, is a nice example because they are specializing in the next- generation by-wire systems that replace traditional mechanical components in the automotive industry with electronic control. We have co-developed here a brake-by-wire pedal system. You see the pedal on the upper left corner on the slide. On the right side, you see the control units where the mechanical signal is transmitted into an electric signal. Our materials are non-conductive, lightweight, anti-static. It's about stiffness, mechanical properties, and you have to meet all the sophisticated GB codes. We developed this system now together with Orient Motion within less than two years, and brought it now as the first mass-produced electromechanical braking system to the market, benefiting from the innovation appetite of Chinese OEMs that are fast moving here into the electrification of all these systems. Let's talk a little bit also about the expected financial outcome of our investment. We have built a fantastic growth platform that benefits from the Verbund advantages. We have leading cost positions. We also, as I hope I could show you, we enjoy customer proximity. We benefit from our local R&D capabilities. As Harry has explained, we are also leading when it comes to sustainability and are well prepared for the green transformation in China. What we expect is that by 2030, we will achieve sales of between EUR 4 billion and EUR 5 billion from the Zhanjiang Verbund site. This is roughly equivalent to around 10% of the current sales in our core businesses. The EBITDA is expected to reach between EUR 1 billion and EUR 1.2 billion by 2030. For 2026, however, we have said this before, we anticipate still a slightly negative EBITDA. This has to do with the startup costs, with the fact that we are still further optimizing the infrastructure utilities to the sweet spot. All this will come during the course of the year. The key inflection point is expected in 2027 when the site reaches full capacity utilization, the startup costs phase out, and the optimization measures begin to take effect. Against this backdrop, we clearly expect the site to contribute positively to EBITDA from 2027 onwards. Harry already highlighted the very smooth startup. Also project execution was, I would say, flawless. Really amazing what the team has achieved. As a consequence, also the CapEx for the entire project from 2019 to 2028 amounts to just EUR 8.7 billion and is considerably below the original budget. Talking about depreciation is expected to amount to more than EUR 500 million per year in the future, starting this year. It's also important, and this brings me to the end of our presentation, to look ahead. What are the focus areas now following the successful startup? Here I can say that, of course, it's a new site, it's a new baby. However, the expectations from management to the performance of the team is just the same as if we talk to our teams in Nanjing and Antwerp, in Freeport or in Ludwigshafen. We expect continuous improvement. We expect high asset effectiveness. We expect a great performance when it comes to operational excellence measures. Now transitioning into steady state operations, we started already with cost reduction programs, streamlining day-to-day operations. Here I would say we have one fantastic advantage compared to other Verbund sites, and this is the amount and quality of data we have, we get out of our new plants because we invested into more sensors, into all the state-of-the-art opportunities that come with AI and digitalization. This will help us to make a lot of progress on a steep learning curve, and further optimize the setup and interaction between all the plants in the Verbund. We talked already about the advantages we have when it comes to green transformation, thanks to the 100% green power supply and the intrinsic advantages we have through the setup we have chosen for the site and the leading cost positions. From that, I believe we have really built a fantastic platform here, and I'm also confident that you will hear many positive news in the years ahead of us. Now we are glad to answer your questions. I would like to open the call for your questions. If you wish to ask a question, please press star and then enter 11 on your telephone. For the best sound quality, we kindly ask you to be sure to unmute your phone and use your headset when asking your questions. The first questions will be from Christian Faitz, Kepler Cheuvreux. We will then have Chetan Udeshi, but now first one is Christian Faitz. Please go ahead. Thank you, Stefanie. Hope you can hear me. Good morning, good afternoon, Markus, Stephan, Haryono and Stefanie and team. Two questions, please. First of all, how certain can you be of the expected still overproportional growth of the Chinese market into 2030, as you elucidate on slide five of your presentation? I mean, for one, China is already more than 40% of global chemical markets, and according to your data, you've just cited apparently even more than 50%. Some geopolitical factors have massively changed over the past 18 months or so. Liberation Day, Iran conflict, et cetera, just to name the most important ones. Could this mean a shift away from China, at least in terms of growth, or what is your perspective there? My second question, as we have the opportunity to talk to you, Markus, as CEO in the last month of Q2, would you mind providing us with a trading update of the key trends you have observed so far in Q2? Are chemical customers, for example, still panic buying as they are afraid that logistics globally might be more challenging going forward? How do you assess underlying demand in your key customer industries? Thanks very much. Thanks, Christian. Markus here. I will try to take both questions, starting with the first one. Of course, these are projections, please also look at the timeframe that we have also taken here. We're not speculating now for the next 15 or 20 years. This is really an outlook for 2025 until 2030, so it's fairly certain. It, I would say also is very much in line with what we are observing already in 2026. As you know, chemical market growth has, in China, been significantly above 5% last year in 2025, it also continues this year with a very strong demand. Short-term, this is certainly over proportionately driven by export growth of customer industries, we still believe that there is a robust domestic demand developing also in China. This is also, I think from our perspective at least, underlined by solid, fundamental, let's say, policy directions in China. Short-term, until 2030, I think we're fairly certain that this picture is valid. It, of course, is also particularly impressive in comparison to the rest of the world, where we do not see any chemical demand growth, this is particularly true due to the weakness that we're seeing in customer industries in Europe and in North America. Yes, China looks a little bit better relative to other regions, in general, the short-term outlook from our perspective is at least fairly robust, plus minus the usual ups and downs. China has, again, in the Iran conflict, from my perspective at least, proven its resiliency when it comes to industrial value chains. China has, let's say, reacted or has been affected much less than people have predicted in early March. Second question on Q2, let's say current trading. I have not seen the May results, I have to say, based on what I've seen in terms of volume development, I can say that the short-term spike that we have seen when it comes to volume, especially in March, slightly lower than in April, is somewhat normalizing. May looks more like April than it looked like March. This, what you call panic buying, I would say this was certainly a certain insecurity in value chains, in particular in Europe. That is somewhat tailing off. What we continue to see is a rather robust price development. When you compare April, May, we still see some areas where pricing has even strengthened. Overall, I would say May looks like a continuation of a fairly strong April. We expect that in Q2, we should be able to come in around analyst expectations, given the current dynamics. Of course, we have to wait until June is in. We see somewhat of a, let's say, overall normalization, so no big hectic effects, but the inflation overall is, of course, not going away with the insecurity in Iran not tailing off. Thanks very much. Very helpful. Again, congrats on the side. We move on to Chetan Udeshi, JP Morgan. We will then have Matthew Yates. First, Chetan Udeshi, please go ahead. Hi. Thanks for taking time to give us this presentation. Quite impressive in terms of delivering this project within the budget. I heard one of you guys talk about it being a baby. It doesn't look like a baby at all, just kidding. The first question I had was just looking at that slide where you're talking about the growth in your business in China from 2015 to 2025, 11% EBITDA growth. I was just wondering if you had any figures for how does your returns compare in China to BASF Group returns? Is China already, would you say, accretive to your group returns at this point? The new Verbund is still ramping up, so it's probably dilutive, but I'm just curious if we were to strip that out, would you say your remainder of Chinese businesses are, at this current point in time, accretive to your group returns? That would be the first question. Second question, you talked about all of the new technologies that you adopted in your new Verbund site in China. Can you give us any sense of how for, let's say, the same product, you can take ethylene oxide, vitamins, probably we don't produce vitamins there, but for the same set of products, how does the cost of this site compare on a like-for-like basis to what you say would have in terms of cost in Europe or U.S. for those products? Thank you very much. Thanks, Chetan. Markus here. I'll start, and then I'll ask Stephan to complement, especially on your first question. What I can say, first of all, I can say, Chetan, you're right, it's a baby, but it's a big baby. Yeah. That's for sure. The birth was also quite lengthy, so we're happy that it's out. Return on our China business. If you look back over the last 15- 20 years, and you can imagine we've done this extensively, you can say that our China business has been over almost every year accretive to BASF Group's profitability. Even when you look at very, let's say, holistic numbers like return on capital employed, has always been in China above also some of the other reference sites that we would consider very good Verbund sites in our global network. Overall, the China business in general, and even our Verbund site in Nanjing, has been over-proportionately profitable. That is also our expectation, of course, now going forward, that the China business is accretive to BASF Group results. You're right, market has changed. China is much more competitive in the 2020s than it was in the 2010s, and will likely be more competitive in the 2030s because it is now a really mature and very competitive chemicals market. That's why we brought our best stuff there, and that's why we bring our best technologies there. With this, maybe Stephan, from your perspective, a comment on the profitability development and then maybe also product or technology comparisons. We have always brought the latest technology to China. We did this at the Nanjing Verbund site. We did it at our sites in the Greater Shanghai area with the MDI asset we built in Chongqing, this is paying off. It's a combination of the technologies we bring, but it's also the way how we operate the sites. Here you can always make a difference, and this now brings me to this aspect of your question where you're asking what do all the data and the digitalization AI tools really help you in terms of achieving a cost advantage? The point is, at the end of the day, when you invest, it's important that your plants really run 24/7, 365 days a year. You don't want to have any hiccups, any unwanted, unplanned shutdowns. You want to be always back on track as soon as possible. Here we can see when we compare to peers, but also when we compare BASF internally, that our asset park in China shows the best performance globally. I'm pretty sure that now with the newest technologies and what we built in Zhanjiang, this will even set new benchmarks over time when we advance on the learning curve. Comparing this between different regions is difficult because you have a different raw material base. You have different partners across the fence. What I can say is if you look now into the cost position of some of our key products, like acrylic acid or butyl acrylate that I mentioned, or NPG, products where already today we are extremely cost competitive in China. If we compare the new plants in Zhanjiang with the assets in Nanjing, I can say this is again, a further reduction in cash cost position. We are very much to the left side and in the example that I'm just mentioning, the cost leader in the Chinese producer landscape. This will pay off over time and really further improves our cost position in key value chains of BASF. Last point maybe, Chetan, what's always important is for us is the cost position in the region that our assets are in. Yeah. Comparing now the absolute, let's say, cost of goods sold of Zhanjiang to Ludwigshafen to Geismar is not so relevant because most of our products actually do not travel so much. We're not a polyethylene producer where you are moving your assets to the lowest feedstock region and then distribute from there to the world, but our products that you've seen in Stephan's presentation are typically in the region for the region, and this is why you have to be competitive where you are. For us, for example, despite the fact that we might have lower costs because we have newer assets in Zhanjiang for certain of our products, it would not make sense for us to ship them from Zhanjiang to Europe because we have also very competitive assets here in Ludwigshafen, even if they are older. For us, the competitiveness in the respective markets is much more relevant. That's why you heard us often talk so much about the relative cash cost position in China. Got it. Thank you. We move on to Matthew Yates, Bank of America. We will then have Sebastian Bray. Now Matthew Yates, please go ahead. Hey, everyone. Thanks very much for taking the time. A couple of questions, please. One bit short-term in nature. You haven't updated the guidance for 2026 about a slight loss on the plan versus what you gave in Antwerp late last year. I would have imagined, given the comments Markus was making about the volume development, the feedstock flexibility that you've highlighted this site has, that you haven't been able to more capitalize on the current situation with the feedstock constraints that the others have. Is that to say you haven't benefited or simply today wasn't the right time and format to review that guidance? Then the more sort of longer midterm question, coming back to what you were saying about Chinese demand growing circa 4% over the coming years. I guess what we've seen is that supply has probably been growing at twice that rate. In light of recent developments, have you seen or heard anything on the supply side of this industry that may mean some of the planned capacity additions from other companies are maybe deferred or canceled? Thank you. Yeah. Thanks, Matthew. I would say, how did you phrase it today? It's not the right format and the right time to update it. Let me give you some color on this. Of course, the last months have been extremely dynamic also in China. We started the year, January, February, as expected. As you know, and I think Stephan has alluded to it, the startup phase of such a big complex is, of course, coming with significantly additional cost. We were super happy with the ramp-up that the team was able to do. We went, as we have also predicted here in some of these calls with you, into high utilizations amazingly quick. That helped. Of course, March was a positive surprise. I think we even mentioned in the last quarterly update that in March, the Zhanjiang site was positive. Because of the special effects, a lot of shortages in China, so strong price hikes that we've seen for some of our products in China. April was also positive, but we also have to now see what I said earlier, that China is this big market with a lot of abilities to recalibrate, and we're seeing already things in China normalizing somewhat. Yes, we had some special effects, but it's too early to call it a day. We stay cautious for the second half because we are seeing also now feedstock volatility, of course. As you can imagine, if you have one naphtha cargo coming in and you bought at the wrong time, that puts your pressure on the margins also going forward. This extreme volatility just lets us to be a little bit cautious. I would say year- to- date, better than we thought. Whether that leads to a better outlook for 2026 on Zhanjiang is still to be seen. Well, anyway, I think, as you heard, maybe Dirk also say this, we're staying somewhat cautious for the second half of the year because of the situation in the Middle East. Maybe your second question, Matthew, how do demand and supply develop over time in China? When it comes to demand, as Markus said already, we are quite confident. Just to give you a number, every year, still 15 million people move from the countryside to cities in China. This is not to Beijing or Shanghai or Wuhan, it is to Tier 3 or 4 cities. Nevertheless, they get better paid jobs. They develop a more sophisticated lifestyle. This all translates into demand that we see ultimately, in our customer industries. Also, the real income of households continues to increase. If you take the households with an income of more than RMB 170,000 in 2020 real terms. This share is currently increasing from 45% back in 2023 to 62% by 2030. The purchasing power, this is one of the underlying reasons why we see still strong demand growth in China. You are absolutely right. At the same time, we see a lot of investment in the chemical industry that was like a backlog. It had to do with the COVID pandemic. There is still capacities coming on stream. What we see at the same time is also that for the first time, I would say, since I am following this, the Chinese government is paying high attention also to the supply side. Very recently, you may have seen that the Ministry of Industry and Information Technology has issued a document number 72 it is called, where they announced a rolling plan starting next year to screen all assets in the oil and chemical industry that are older than 20 years To apply a risk-based approach to decide if they have to be phased out, upgraded, or reconstructed. This is now, I would say, a very tangible document that somehow shows the plan they have to really make it happen, that they take out plants that are not only unsafe, but were also not up to date when it comes to emission control and energy efficiency. I am convinced this will, medium term, become visible. You will not see it now next quarter or beginning next year, but over the next three, four, five years, this will help to bring, again, demand and supply into a balance in China. One additional point, this gets, from my perspective, still too little attention, is of course now the sustainability direction that the Chinese government is taking under the 15th Five-Year Plan, which makes decarbonization targets now politically enforceable in China. You all have heard that in the past, provinces in China have competed with each other on GDP growth, that spurred certainly a lot of investments because investment counts to GDP and so forth, there was this competition on GDP numbers. In the new framework, there is a so-called five plus nine framework, this includes five binding indicators, total emissions, carbon intensity, coal and oil consumption, non-fossil energy share, and nine supporting indicators that are binding targets for the provincial governments, this will also lead to a curtailing of capacities that are not contributing to these sectors. This, again, as Stephan said, is nothing for the next six months, but it sets in motion a direction that, in China, will lead to a higher quality and less, so to say, involution growth. That's why also we believe that we are with our leading carbon footprint site in China in the right place at the right time. We now move on to Sebastian Bray Berenberg. We will then have Laurent Favre. And if you wish to ask a question, please press star and then enter 11 on your telephone. But now it's Sebastian Bray. Please go ahead. Hello, good morning and congratulations on the new facility, and thank you for taking my questions. I have three, please. The first one is, what type of run rate is this facility going to hit in volume terms at the end of 2026? Is it just maxed out? Is it running as hard as possible? My second is on the definition of mid- to- up-cycle. If I look at the chemical segment of BASF more broadly, or even materials, the peak and trough EBITDA are multiples away from each other, and yet the mid- to- up-cycle guidance of this plant is 1.0 to 1.2. If you were to broaden this to, let's say, all plausible outcomes with zero being the lowest, as it probably will be close to this year, what would you say is a potential high point? And my third one is India. I remember BASF was toying with the idea of building a EUR 2 billion acrylics-focused facility in that geography a few years ago. Is this going to be an export facility for India? Are there any plans, even in the early 2030s, to add capacity there? Thank you. Maybe let me take the first question about the run- rate. I think the first good news is that all our assets are healthy. Not only that we have started them successfully at the beginning of this year, starting from the cracker also to the downstream plants. They have been commissioned, and they are running fine today. I would say there's also a little bit of mixed bags of the run- rate, because for products that we consider downstream, typically also it requires a ramp-up time due to qualification of the customers, acceptance of the customers. That differs between product to products. For the upstream, typically today, if we don't have any raw material constraint and assuming that all economically support that, we are aiming, of course, to run the site at maximum rate that we can. Today, on average, just to share that with you, for the month of January to May, if I may already include May into the pictures, we are probably close to around 80% of our run- rate for the entire site on average. Definitely this is also in line with also our statement that this year is still the year of optimization. Because the entire Verbund is brand new, this requires a lot of optimizations, and also, like downstream products, require the acceptance of the customers. Of course, our goal is to ramp- up this as soon as possible. Stephan, maybe I, or Markus for the question number two. Maybe I'll take the question on the very difficult question around mid- to, what do we call it, mid- to- up-cycle conditions for margins. It's very difficult and also I'm struggling with myself to whether I want to give you a number because I'm also struggling to be where do I put myself on this zero to 10 scale because it's of course also product dependent. There are products like let's take MEG as an example, which is certainly a product that in the past has been a significant import product in China. China has become much more resilient and is producing much more products like MEG now locally and has different raw materials also. MEG is made in China from coal. It's made from naphtha as a product from steam cracking and it's made also in other ways. It's very difficult to now predict for each and every product now, where will we be in a few years? In general, I have to say, even with the recent increase in commodity margins over the last two to three months, we are still not overall globally at what we would call mid-cycle conditions, and we are still far away from what we have seen as up-cycle margins. There's still a way to go, and since China is becoming more and more a price setter for products also in the rest of the world, especially in markets like Southeast Asia, India, and Latin America, and increasingly also in Europe, I would say that the supply demand rebalancing in China will, at the end of the day, determine when we will be at mid- to- up-cycle conditions, what we have anticipated also in our strategy. It will certainly be towards the end of the decade and not in 2026 or 2027. Not a number, but I would say we are at least preparing us for a slow but steady recovery on top of the volatility that we are seeing. Of course, the up and down will not go away. India, Stephan, you want to take? India is definitely an interesting market. We have defined India as one of the seven advanced countries in our Winning Ways strategy because we see that there's now more and more investment into industrial production, into manufacturing, which translates into demand in our customer industry. The size of the Indian chemical market is becoming more relevant. You also have to take into account that if you compare the Indian chemical market to the Chinese chemical market, there is a difference of a factor of 15. You could also say the Indian chemical market fits into one larger Chinese province. Nevertheless, it's fast-growing, it's interesting. Coming to one aspect of your question, India is definitely not a platform to produce chemicals or plastics for export. If we look into opportunities in India, it's for the domestic market. We would need a very competitive setup in one of our key value chains. It's something we are considering, but we are not in a rush. We are not in a need to do anything at this. You also know our guidance when it comes to CapEx. We want to stay below depreciation levels. There's opportunities. We will always look into opportunities in India, but it's too early now to come to a decision point or to make any announcements at this stage. Sebastian, I think your question was also whether we are supplying maybe India from Zhanjiang. That is certainly not the intent. As Stephan said, we believe in India. We believe India is a very promising market for chemicals in the next decade. We are thinking about investment opportunities also in India, because I don't believe that at the end, you can be long-term successful by importing products into India. We're doing this, of course, right now successfully, for example, also from our Southeast Asian [audio distortion] Kuantan. But also from Europe we are importing into India now with the new free trade agreement with India than even is more competitive. So overall we are preparing India for the next growth phase. We have nothing imminent yet but we believe in strong local chemical production in India for the next decade. Asian [audio distortion] Kuantan. But also from Europe we are importing into India now with the new free trade agreement with India than even is more competitive. So overall we are preparing India for the next growth phase. We have nothing imminent yet but we believe in strong local chemical production in India for the next decade. [crosstalk] Now its Laurent Favre, BNP Paribas. Please go ahead, Laurent. Thank you, Stefanie, and good afternoon. My question is going back to supply and supply rationalization. I think that including your project from 2026 to 2030, we're meant to see, I don't know, 25 million+ tons of new capacity in China. I'm wondering in your thoughts on the recovery to mid-cycle, on the other side, how much rationalization do we actually get? Maybe if you have a view on how many of those facilities don't make the five plus nine cut, and to what extent you think that those facilities would not upgrade, modernize, and decarbonize. Of course. Laurent, difficult now to go product- by- product, but I would always caution when we look at these big numbers. 25 million tons of additional capacity. If you deduct what I would consider products that are outside of our scope, polyolefins, PVC, those types of large-scale commodities, you come already to a much smaller number. Because most of the announcements, especially the large joint venture announcements that are now made by Middle Eastern players with some of the state-owned companies, also private companies in China, they're mostly geared towards creating autonomy in China with regards to ethylene and ethylene plus one products, and that's not our playing field. Yes, we also have a polyethylene plant, but this, as Stephan said, is more a scaling needle. This is not a strategic business for us. It's always a little bit from our perspective, at least, over pronounced, so to say, if you look at these big headline numbers of capacities. Also in our value chains, we have overcapacities in China, for sure. As you have also seen, and that's why Stephan has mentioned also these customer examples. If you break it down to individual opportunities, value chains, and locations, China is not one market. You have to look at what is happening in the province in Guangdong. Do you have customers that can provide you a base load with these plants? You have seen this example of this long-term BASF customer, Youyi. If you are successful with them, if you have a partnership with them, they can take the output of an entire BA plant at once, so to say. That's their annual demand. There is no other customer like this in the rest of the world. It just doesn't exist outside of China. You have to break it down to the very individual level. Yes, we are fighting with over capacity, we are fighting with long markets in China, and we are fighting with historically low margins at this point in time. I am sure that there is plenty of opportunities to position ourselves with these product lines that we have successfully, also in the Chinese market. What we are seeing, however, is also when we talk to some of our partners, it is much more difficult to get permits for new capacities in China. Often when a modernization or a new capacity is planned, the Chinese government asks also for rationalization of old, high-energy-consuming, high-emission plants. We are seeing this also in the Nanjing cluster, for example, where we are operating. The restructuring of the ethylene landscape or cracker landscape in Nanjing will not lead to an overall expansion anymore. It will lead probably to a modernization in line with the five plus nine targets. The times where the Chinese government and local governments are incentivizing or endorsing significant capacity expansions seem to be over, and also the pipeline of announcements of Chinese competitors for new investments is, from our perspective, at least, slowing down. Whether this becomes reality or not, the next years will show. At least from our perspective, the trend is clear. Again, we should not expect a fast-turning ship, that this will be rather a slow-turning tanker. Maybe to add one aspect that shows how determined the Chinese government is to really stop the agglomeration of new overcapacities. Until very recently, new cracker projects in China could be approved by NDRC, the National Development and Reform Commission. This is no longer the case. From now on, the state council has to do the formal approval, it shows how serious this is now and that is on the radar screen even of the higher echelons in government to avoid overcapacities long term. There are no further questions, this brings us to the end of today's virtual deep dive on our new Verbund site. We hope you found it informative and insightful. We will present our second quarter results on July 29th. Should you have any further questions today, please do not hesitate to contact a member of the BASF IR team. Thank you for joining us today, and goodbye for now.