Dear ladies and gentlemen, welcome to the Q3 2021 results call of Brenntag SE. At our customer's request, this conference will be recorded. As a reminder, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions via the telephone lines. If any participant has difficulties hearing the conference, please press star key followed by zero on your telephone for operator assistance. May I now hand you over to Thomas Altmann, Head of Investor Relations. Please go ahead, sir. Thank you, Lucas. Good afternoon, ladies and gentlemen. On behalf of Brenntag SE, I would like to welcome you to the earnings call for the third quarter of 2021. On the call with me today are Dr. Christian Kohlpaintner, our CEO, and Georg Müller, our CFO, who will take you through today's presentation. After the presentation, we're open for your questions. All relevant documents, including the quarterly Excel fact sheet with key financial figures, have been published this morning on our website at brenntag.com under the section Investor Relations. In the same area, you will find the playback of this conference call later today. Before we begin, allow me to point you to our safe harbor statement, which you will find at the end of the slide deck. Having said this, I will now hand over to our CEO, Dr. Christian Kohlpaintner. Christian, the floor is yours. Well, thank you, Thomas, and good afternoon to everybody. As usual, I will start with the highlights of the quarter, and Georg will provide further details on our financial performance later on. Brenntag achieved outstanding results in the third quarter of this year in a persisting exceptional market environment. I will talk about the current unusual and challenging circumstances we observe in our global markets in more detail later. The group generated operating gross profit of around EUR 862 million, which on a constant currency basis is an increase of around 24% compared to the third quarter last year. Operating EBITDA also developed well and amounted to around EUR 343 million. On a constant currency basis, this is an increase of around 30% compared to the solid third quarter a year ago. Besides our organic performance, we are also very satisfied with the contribution of EUR 12 million by our newly acquired businesses in the reporting period. Free cash flow amounted to EUR 155 million. Our EPS stood at €1.02 in the past quarter, which is a substantial increase of around 34%. Let me emphasize, 2021 has been a successful year for Brenntag so far. We were able to navigate all the challenges prudently and have increased our guidance for operating EBITDA for the full year 2021 twice this year. Today, we confirm our guidance of an operating EBITDA for the full year 2021 to be in a range of EUR 1,260 million-EUR 1,320 million. We also successfully continued the implementation of the different measures of Project Brenntag and are fully on track with the transformation of our company. Before I hand over to Georg for a deep dive into our financial performance of the past quarter, allow me to talk about our two global divisions and the product portfolio they offer. We are very satisfied with the Q3 performance in both of our divisions. Brenntag Essentials and Brenntag Specialties contributed to these outstanding results. In line with our long-term expectations in Q3, Brenntag Specialties grew stronger than Brenntag Essentials despite the unusual market conditions which typically would favor our industrial chemicals business. As we frequently discuss with our key shareholders the divisional allocation of our product base, I would like to take the opportunity to briefly explain again the positioning and definition of our specialties business and of what we deem to be the most stringent product allocation in our industry. In chemical distribution, buying decisions are often taken by different stakeholders. In order to offer tailor-made solutions and to fully meet the products and services demands of our customers, Brenntag Specialties focuses on selling baskets of ingredients and value-added services that are directly used in the production of our customers' end products. As an example on slide four, we have shown products and ingredients that are accounted for in the nutrition industry of Brenntag Specialties. These are, among others, flavors, emulsifiers, sweeteners or colorants. On the other hand, Brenntag Essentials complements the specialties product and services portfolio with so-called process chemicals. Such process chemicals are needed in the broader production process of our customers and are not a part of the final product, typically. Here, to stay within the example for the nutrition industry, these products would be sodium hydroxide, sodium hypochlorite, sulfuric acid or hydrochloric acid. Let me emphasize that neither process chemicals sold to our six defined focus industry are accounted for in our Brenntag Specialties division, nor specialty ingredients being sold outside of these. Please refer to page five to see a schematic representation of our stringent definition. Today, our Brenntag Specialties portfolio and offering is already the broadest and the most diversified in the specialty sector in our industry, putting Brenntag clearly in a leading position. Now, let me provide some flavor on what is going on in our global markets currently, and I'm sure you hear similar statements from other corporates as well. We continue to see disruptions caused by lockdowns in connection with the COVID-19 pandemic. In Q3, particularly Southeast Asia, and especially countries such as Thailand, Vietnam, and Indonesia were affected. Global supply chains and distribution channels are still under severe pressure. In addition, we see spiking energy prices, particularly in EMEA, leading to disruptions in energy-intensive value chains. The circumstances in Asia-Pacific, and specifically in China, are particularly difficult. In the course of the actual five-year plan, China has imposed its dual control regulatory program. China's overall goal is to become carbon neutral by the year 2060. The so-called dual control regulatory program, rolled out earlier this year, seeks to support this goal by establishing specific reduction targets for both energy consumption and carbon emissions. These will be achieved during the five-year period, 2021 to 2025. The objectives are to reduce energy consumption per unit of GDP by 13.5%, which means for 2021 already a reduction by 3% and a reduction of carbon emissions per unit of GDP by 18%. In the third quarter, we have observed that the likelihood of missing the annual targets leads to a rather aggressive directive steering of energy-intensive industry and operations. As a consequence of this, China is currently experiencing a real shortage of electric power, and some chemical producers have already reduced their production capacities accordingly. Taking all these aspects together, further shortages in key chemical products, as well as reduced hardware activities are to be expected. Given all these events, we believe that the challenging market conditions will prevail well into 2022. With this, I hand over to Georg, who will walk you now through the details of our financial performance in the last quarter. Georg? Yeah. Thanks, Christian, and good afternoon to all of you. Apologies ahead for the raspy voice today. I hope it doesn't impact Q&A, and the answers don't have to be too short. I'll give my best. I'll speak about our key financial figures for the third quarter, 2021, and I would start with the development of operating EBITDA. On slide eight, you see the bridge of operating EBITDA from the third quarter, 2020 to the third quarter this year. In the third quarter, 2020, operating EBITDA amounted to EUR 264 million. The translational foreign exchange effect in the third quarter, 2021 is negligible, with only around EUR 1 million. Our acquisitions contributed EUR 12 million to the operating EBITDA growth. Again, both divisions, Brenntag Essentials and Brenntag Specialties, achieved excellent organic growth rates in the past quarter. Brenntag Essentials reported organic operating EBITDA growth of EUR 44 million, which is a growth rate of around 27%. Brenntag Specialties again grew even stronger. The division achieved an organic growth rate of 34%, with an additional EUR 36 million of organic operating EBITDA growth. We finished the quarter with around EUR 343 million of operating EBITDA, a very strong organic growth of 25%. Overall, we continued to benefit from good margin management and were able to generate high gross profit per unit. In the third quarter of this year, both of our global divisions delivered strong results. Please keep in mind when talking about growth rates, we generally speak about FX-adjusted growth rates. Brenntag Essentials operating gross profit amounted to around EUR 520 million, an increase of about 20% year-over-year. Operating EBITDA reached EUR 210 million, around 29% above previous year. Within Brenntag Essentials, the segments EMEA, North America, and Latin America contributed to this strong performance, while Asia-Pacific was impacted by further COVID-19 lockdowns. Conversion ratio for this division came in at around 41%. I'm coming to page nine. Brenntag Specialties continued to benefit from good margin management and again in accordance with our long-term expectations, grew even stronger than Brenntag Essentials. Brenntag Specialties reported operating gross profit of EUR 334 million. This is an increase of around 30% compared to the third quarter 2020. Operating EBITDA amounted to EUR 153 million, an increase of more than 42%. Almost all segments and industries contributed to the performance, while pharma and personal care, HI&I were a bit weaker the past quarter, and some countries in Asia-Pacific were impacted by COVID-19 lockdowns. Conversion ratio for Brenntag Specialties was around 46% in the past quarter. In summary, we are very, very satisfied with the performance of Brenntag Essentials and particularly Brenntag Specialties. I'll skip the details on page 11 and 12, and I will move to our income statement on slide 13, where I particularly focus on the lines below operating EBITDA. In Q3, we reported special items amounting to an expense of EUR 15.4 million. EUR 3.6 million relate to the execution of Project Brenntag. In addition, a provision was recognized for possible breaches of export control regulations by a company we acquired a few years back. Depreciation in Q3 was about the same level as in the third quarter last year, and the financial result amounted to a net expense of around EUR 17 million. Finally, profit after tax strongly increased by about 33%, achieving EUR 161 million in Q3. Also, our earnings per share rose strongly by more than 34% to EUR 1.02, compared to EUR 0.76 in Q3 2020. Our free cash flow has developed solidly in the third quarter. We reported a free cash flow of EUR 155 million. The clear reduction against previous year is mainly impacted by the increase in working capital. However, working capital management, measured by working capital returns, continued to be strong. Our net financial liabilities amounted to around EUR 2 billion at the end of the third quarter, as it compares to EUR 1.3 billion at the end of last year. The increase of net financial liabilities is driven by the operating development of our business, in particular by the working capital development as well as by payment for this year's acquisitions. Our leverage, that is net debt to operating EBITDA, amounts to 1.6x. I would like to draw your attention to our Bond 2029 in the diagram on the right-hand side of slide 15. Beginning of October, we placed a new EUR 500 million benchmark bond on the European capital markets in a very successful transaction. It is the first bond that we issued under a newly established debt issuance program. It has a maturity of eight years and a coupon of 0.5%. The issue price of the bond was 99.711. We will use the proceeds from the bond issuance to pay down existing financial liabilities and finance our general business development. As the bond was only issued in October, it is not yet shown on our balance sheet as per end of September. I'm coming to working capital. Working capital amounted to around EUR 2 billion at the end of the third quarter. This is an increase of more than EUR 600 million in course of this year, and is mainly driven by high chemical prices and inflationary developments in the chemical industry. Despite this price and inflationary driven increase, we turned the working capital 8.4x in Q3, which is significantly above the same quarter last year. Let me summarize that we are very satisfied with these excellent financial results. Now I hand it back to Christian. Thank you, Georg. A ll the best to your voice. Now, I would like to provide you a brief update on our Project Brenntag execution. We continue to make very good progress with our global transformation program and are fully on track with the implementation of our Project Brenntag measures. We have structurally reduced more than 740 jobs by now and have executed 68 of the planned 100 sites closures. At the same time, we also significantly invested in our network infrastructure, for instance, in two new mega sites in China. By now, Project Brenntag delivered around EUR 70 million of additional operating EBITDA compared to the 220 million EBITDA uplift by 2023, for which we guided you during our capital market update exactly a year ago. Measures addressing our top line contributed around EUR 12 million. The bottom line levers, mainly our go-to-market approach and the site network optimization, as well as our measures with regards to indirect procurement, are summing up to around EUR 59 million. On slide 18, we show the breakdown of this figure in top line and bottom line levers. Let me emphasize that the successful execution of our transformation program requires a strong focus on our people and change management. We offer an intense portfolio of trainings, both for our leaders and for our employees, to support them in the transformational journey. To foster the implementation of a performance-driven culture, which will guide Brenntag in the future. Let me say a few words on the development of our digital journey. On page 19, we provide an update on the digital sales channel development. We continue to make solid progress with our initiatives, and Brenntag Connect is now active in 25 countries. We continue to observe a steady increase of onboarded customers and number of orders on our platform. Currently, we generate more than EUR 200 million sales with Brenntag Connect. Currently, we are working on our digital strategy for the coming years to service our customers best. This includes our digital value creation roadmap and the operating model to implement our future digital business architecture. As indicated last quarter, we will provide an in-depth update on our digital transformation journey next year. Ladies and gentlemen, let's come to the outlook for the full year. 2021 is almost over, and Brenntag has had a very successful year so far. We have increased our operating EBITDA guidance twice this year and today confirmed the corridor of EUR 1.26 billion-EUR 1.32 billion for the full year. Given the magnitude of the current supply chain disruptions, we expect these unusual and difficult market conditions to persist well into the next year. We also expect continuous pressure on global supply chains and spiking energy prices going forward, and we will closely monitor the developments in China. Even in this challenging environment, Brenntag is well-positioned to continue on its successful path. Our focus remains on keeping the high level of service excellence towards our partners and supporting our customers in maintaining their operations. At the same time, we will further concentrate on the next steps of the implementation of Project Brenntag as the basis for sustainable future organic earnings growth. With this, I would like to conclude the presentation. Georg and I are more than happy to answer your questions now. Thank you. Thank you. We will now begin our question- and- answer session. If you have a question for our speakers, please dial zero-one on your telephone keypad now to enter the queue. Once your name has been announced, you can ask a question. If you find your question is answered before it is your turn to speak, you can dial zero-two to cancel your question. If you're using speaker equipment today, please lift the handset before making a selection. One moment, please, for the first question. The first question is coming from Chetan Udeshi at JPMorgan. Your line is now open. Yeah. Hi. Thanks. I had a couple of questions. The first one is a bit more direct question. You know, it's great to see progress on Project Brenntag with more site consolidation, headcount reduction, other benefits. I think the question here is, and I asked this last time as well, and I'll try again this year. You know, when I look at the constant currency OpEx growth in third quarter, it is up 20% year-on-year. I'm just trying to reconcile all of the improvements on Project Brenntag with that significant increase in OpEx. Can you help us tie those two things together? It would be very useful if you can break out the OpEx growth into individual parts. Because I think the concern some would have that, you know, to some extent the you know the rising tide today with you know disruptions, pricing is contributing most of the earnings growth and not necessarily Project Brenntag. To the extent you can give us some more color on the drivers of the OpEx growth will help that debate a little bit. The second question was, is there a way for you to quantify how much pricing benefit you know you might have seen already in the first three quarters of the year, or what do you expect for full year this year, and how should we think about the levers to offset some of that drag next year if there was to be one? Thank you. I think Georg will go into the details around OpEx and maybe pricing. Maybe just to reflect on one element of the OpEx besides the logistics costs and everything, which is, of course, you know, massively increasing, which you see there. Let's just take the personnel expenses, the PEX costs. If you see the PEX costs are actually going up, and there is a couple of reasons for that. One of it, of course, we have acquired in the last quarter. Y ou see a big impact on the M&A side with people coming to the organization through the acquisitions we have been undertaking. That's one topic. If you look on the compensation, you know, variable compensation versus fixed compensation. Fixed compensation or fixed personal expenses went down year to date EUR 22 million, roughly. This is exactly what we see also according to Project Brenntag. On the other hand, as the company is outperforming massively. Variable compensation is massively up, so we have taken provisions, so far of around EUR 50 million-EUR 60 million variable personal expenses based on the outperformance of the company. That's the variable component. If you take all those three elements together, M&A coming, bringing people in, the fixed personal expenses massively going down, variable expenses being up due to the outstanding performance of the company, I mean, you get already some color of what the drivers are, in that respect. Having said that, I will leave it up to Gerhard maybe to address some other topics in OpEx and also on the pricing side. Yeah. Chetan, hi. let's see how we can split it out. Man, when you mention in Q3, at least that's the way I heard you, 20% OpEx increases, that's a number that includes OpEx that comes through M&A. Pure organic OpEx increase in Q3 is around 15%. Still a high number, but it's a differential between 15% and 20%. When I try to slice the 15% OpEx increases in Q3 into the different affected cost items, then a little bit less than half of the cost increases come from personnel expenses, and roughly one-fifth, a little bit more than one-fifth, comes from external transport and fuel and energy. Obviously, external transport and fuel and energy is subject to very strong inflation of rates in the market. The personnel expenses is exactly related to what Christian mentioned a minute ago. It is not an increase in the number of heads. To the opposite, we see a decrease in head count by now, a decrease in organic head count, but we do have relatively meaningful increase in costs per head, and that's by far dominated through much higher variable compensation given the excellent results. Fuel and energy, external transport costs explain 60, roughly 60% of the expense increases, and the rest is a broad mix of different items. Thank you. On pricing? Sorry, Chetan, I didn't get the question on pricing. Apologies. Is there any number you can provide on how much benefit you might have seen already in the first three quarters from pricing? I'm talking about net pricing or GP per unit. How should we think about the levers into next year to offset any potential decline from the current favorable pricing? Man, given the supply chain restrictions and given that the product scarcity, there is limited volume increase, almost no organic volume increase in the business this year. Which by the way, we think to be quite an achievement given the product scarcity in the market. The gross profit increase you see is predominantly a margin increase. Understood. Thank you. Sure. The next question is coming from Rory McKenzie at UBS. Your line is now open. Good afternoon, all. It's Rory McKenzie here. Three for me, please. The first is kinda following up on that last one. With your operating gross profits up about EUR 300 million year-over-year for nine months, 2021, you know, as you just said, stripping out Project Brenntag and stripping out the M&A, that's still over EUR 200 million increase, which you just said is nearly all kind of organic gross profit per ton expansion. Do you think that would have been possible in a normalized market environment without product shortages? C an you maybe help us understand, you know, beyond Project Brenntag, what you've been doing to maybe improve your procurement or your pricing, and how much of that gain will be sustainable as those shortages eventually normalize? Maybe just that one first, 'cause the next two are separate. Thank you. I'm sorry. We are not in the same room today. That makes us a little clumsy. Would the strong gross profit per unit increases have been possible in the business-as-usual environment? Man, no. They are at least in that extreme order of magnitude. They are coming from the product scarcity, but also from our ability in this with our supply chain strengths and the supplier relationships to fulfill by far most of customer demand and have product available. Is it a concern going forward? Not really or not necessarily, because experience tells over many cycles that if and when the day comes where we see some pressure on gross profit per unit, it happens in an environment of increasing volumes. There is all expectation that if the day comes where gross profit per ton reduces, it can be compensated by volume development. Okay. Thank you. That's helpful. Moving away from that pricing point, thanks for the stats on slide 19 on Brenntag Connect. Could you just talk about what percentage of your total business that channel now represents? Also given the big growth there, how that's feeding into your restructuring of the sales force and the locations. You know, is this allowing you to maybe take more action sooner as you're shifting capacity onto this different channel? Thanks for the question. As I said, in the call or in the announcement, it's about EUR 100 million annual sales we're currently having. It encompasses less than 100% of our turnover, so still small. But you see the growth rates quarter by quarter and yes, they are progressing. Of course, you know, it takes a lot of effort to get really customers also on the platform. It's sometimes not natural that they just go to the internet platform or to Brenntag Connect. It requires a strong discussion and management by our sales force. Of course, it is necessary as we have outlined in Project Brenntag that we go to a very clear customer segmentation, and the customer segmentation basically determining our go-to market approach. Where to focus, where do we have outside salespeople, where do we have inside salespeople, and what is a group of customers which ideally would make the transactional business through Brenntag Connect. What you see actually as the growth rates quarter by quarter are increasing, that's the result of that effort. This is of course one of the efficiency elements I have been talking about on our digital journey, which we need to leverage and continue and speed up going forward. you know, currently we see that with every country we are onboarding, the number of recurring orders, the number of customers on that platform is steadily increasing. That's exactly what we also want to accomplish in our go-to market approach. Great. Thank you. Just finally on the working capital, given the product shortages and scarcity, has there been any change or are you being asked for any change in your kind of trade payables and your payable terms? Equally, are you changing anything with your customer payment terms at the moment? Thank you. No. There is no major trend about changing payment terms currently, neither on the customer side nor on the supplier side. It's always a standard part of the business, fight in the day-to-day business to optimize payment terms on both ends. Currently there's no major trend in the market. The key in improving working capital turn or controlling working capital turn right now is more on the inventory side, given the strain in the supply chains. Great. Thank you both very much. Very clear. Sure. The next question is coming from Isha Sharma at Stifel Europe. Your line is now open. Hi. Good afternoon. Thank you for taking my questions. Thank you for the explanation on your portfolio. Could you help us understand how different it is, the end market and the operational model versus your pure specialty peers? Would you say that the specialty segment that you have is one-to-one comparable to your peers? That would be the first one. Second one is on the situation in China. You mentioned that it's currently very challenging, but the region is still small for you on the group level. Do you see more of a global impact of what's happening in China? Yeah. Thanks, Isha for the question. You know, it's again not comparing too much with competitors. I think what we have chosen as a definition for Brenntag Specialties, I firmly believe it's the purest specialty definition you can imagine. Six focus industries we have selected and only real specialties which are sold into those focus industries are accounted for in the Brenntag Specialties division. That, I would say, is unparalleled in the industry, to be very clear about this. The China topic, yeah, it is for us domestically. Domestically, you know, it's a market environment we are performing, I would say according to what you could see in the market environment China is operating in. Also our acquisitions, like Zhongbai Xingye, which is in the food industry, is less impacted by that circumstances. Nevertheless, it's our domestic business. What is even more important for us is of course the supply of materials out of China, which gives us a very good reading, a very good transparency on how the product flows are going. We currently have, you know, at any moment about 1,200 containers on the ships going out of China to Europe and then to U.S. or directly to the U.S. Here you clearly, you know, can observe that we have massive disruptions there on the supply side. Many energy intensive producers have cutting back their production because of lack of energy or trying to adhere to the given targets by the government in China. That has of course immediately an impact on all the global supply chains. Because again also large Western manufacturers or large chemical manufacturers from the Western Hemisphere are producing in China and are exporting material out of China. That has immediately an impact on the supply chains. Let me again reemphasize, this is exactly where Brenntag's strength is. We can play various global supply chains quite well. Our global presence in 77 countries make us quite resilient for these kind of things. This is what we have demonstrated, I would say now over the last almost 20 months since we entered into the COVID pandemic. I think it is important for all of us to understand that the dual control regulatory program in China will have not only an impact on China and an impact on the Chinese chemical manufacturers, it will impact also how stressed or how overburdened are other supply chains in the rest of the world. That's very clear. Just to follow- up on this one. Is there scope for increasing or having an even higher pricing power going into 2022 because you already had such a strong year so far? Can we imagine year-over-year, even further upside scope to earnings? Or is it that, with this kind of situation, you will be able to continue the performance that we have seen, so kind of a flattish development year-over-year? No, I think one needs to be careful because the situation right now is hard to read. Our prediction is that the disruptions and the stress in the supply chains will be visible and feelable well into the first half of 2022. They will not normalize very quickly. Shortages of containers, shortages of container ships, the reduced harbor activities, the long lines of ships waiting on the West Coast of the U.S. to be unloaded. This doesn't disappear from over Christmas, so to speak. It will continue further down. That means that, you know, product availability still will be a key challenge going forward. With Brenntag being well-positioned there, our target and our goal is to keep our customers operating. Even if you cannot supply them all the volumes they probably would need, still we try to maintain the minimum operation rates they need to not shut down their operations. That, you know, is a role Brenntag is playing very well. That means product availability is a key topic and a key question, at least in the first, into the H1. I think, you know, once a little bit normalizing of those effects starts to kick in, we believe the prices quickly will actually adjust. Then, you know, it comes to, you know, volume and how much volume is available and how much volume can you actually deliver to the market. What Georg has said before that our anticipation is that there will be a volume recovery seen in 2022 is also, you know, a key part of our scenario. When it actually will happen is really hard to predict right now. You know, when you asked me last time about this, how long will this prevail? It already took longer than I ever thought. Now, you know, we need to see how that constrained supply chains will continue. It will be, you know, a pricing and volume balance, a fine line to walk into the H1 and then of course, into the H2 of 2022. Right. Just the last one, if I may. This time when you have, when a certain normalization happens and we talk about volumes, would you say that Brenntag is better positioned than it was in the past in terms of volume leverage because of the effects of Project Brenntag? Because as you talked about the fixed costs going down, we have seen in the past that the EBITDA was actually growing slower than the gross profit. Would you say that you are more confident that that should change going forward? Yes, absolutely. This is exactly why we are doing this. I've always said that Project Brenntag is actually the response and the answer to the question, why could the company not grow organically for five years? Having given Project Brenntag as an answer, the EUR 220 million uplift, of course, brings us in a different position than we were before. That's the whole exercise. With executing, allow me to say that, I mean, Project Brenntag is running like clockwork, so it really is delivering month by month what we do expect. I'm very confident that this EBITDA uplift and the reduced cost base will make us more cost competitive. Also addressing maybe the question of Rory before. What do we do about it, if normalized markets are there? We have the impacts of Project Brenntag. We will have a highly efficient and with the lowest cost to serve in the industry Essentials business, created and ready to deliver as it does already now. You see it already in the numbers. Of course, we have the focused Specialties division and the Specialties business with their new market approach and their strong focus on value-added services and their strong focus on application know-how will play also out of this strength. That portfolio, as I described it and as it is defined, is much less exposed to any volatility than you would expect. From that perspective, I'm highly confident that if, even if normalization starts to kick in and this exuberance of the market is somehow normalizing, that Brenntag actually will be positioned much, much stronger than in the past to harvest on the volume recovery, which we predict now for 2022. Thank you so much, Christian. Really helpful. Isha, thanks. The next question is coming from Andy Grobler at Credit Suisse. The line is now open. Hi, good afternoon. Just three from me. Actually, two of them are quite linked, if I may. First, kind of going back to pricing, you've said that the gross profit growth this year is almost all price. How much of that is kind of market pricing? How much of it is Brenntag-specific pricing? Because you talked previously about wanting to increase some prices before we got to this kind of supply chain disruption. That's the first one. Second, kind of related, to what extent do you think you are winning or losing market share in your end markets through this kind of slightly turbulent series of end markets? Thirdly, just in Asia Pacific, you've called out a couple of issues in China and then the COVID-related lockdowns. Can you give us any idea of how much those two factors have impacted your growth? Is it mainly China, or is it mainly the COVID lockdowns that have caused the slower performance in that region? Thank you very much. Yeah. Well, thanks, Andy, for the questions. I think on the pricing side, let me compliment really our teams. It's a remarkably good capability the Brenntag organization has to deal with volatility in the market, in particular, also when it comes to pricing, but also to volume volatility. But on the pricing side, the organization has done extremely well to navigate this prudently. As I said, you know, availability in these circumstances is much more important than the price at this point of time. That does not mean that you can do whatever you want. Of course, you have to be in line with market. You have to be in line what the market movements are telling you. We are not, you know, totally out of what the markets typically would see. This is what you also see with other announcements from companies in the chemical space. We adjust quite fast and quite agile to draw on those opportunities. There's very little delay, let's say, until we can roll over a raw material price increase we are faced with to our end markets. You know, we are also depending on what the chemical manufacturer has a price idea and at which price we can source that material from him. This manufacturer needs to make choices. Do I give this material to a distributor? Do I give it directly to my sales force? When allocation is key at this point of time in the market, it is, you know, the good relationships we have with our suppliers, the strong presence and the strong role Brenntag plays as the global number one, which helps us to do that. That leads me to answer your second question. I think we are winning in this situation. We are gaining market share because many smaller competitors, which do not have those independent supply chains and which do not have the strong relationship to our key suppliers are indeed suffering here. I believe we are actually able to outgrow the smaller competitors quite well. Again, it's a product-by-product different situation. Sometimes, the solvents market is ticking differently than for instance, the acid and lye markets are. I think you need to always differentiate there. But I believe overall, Brenntag is in a good position to, you know, maintain or even gain market share in these volatile situations and hold on to it, as I said before, because Project Brenntag will give us the benefits of being more cost competitive going forward. Last but not least, on APAC, on your question, I would say the impact, Georg has shown the numbers, and you can see it on APAC and overall. China, of course, has been hampered, has had an impact. What is hurting us a little bit more is currently, for instance, the shutdowns we have experienced in Vietnam and in Thailand. These are the two largest countries we have actually in Asia. Vietnam, one of our key markets. Here, we clearly have seen that you know the business activity is substantially reduced with an extremely tight lockdown since now more than two months. So we have seen that evolving. Long-term, to be honest, I believe the question about the dual control and how it will impact the export capacity of China and the production capacities in China, for me, is the more concerning topic. Thank you for those answers. Can I just go back to pricing? 'Cause I just on a kind of gross profit per ton, I wasn't quite clear whether you felt that your gross profit per ton had gone up more quickly than the market as a whole. I would not say. As I said, the market is extremely volatile. You see, you know, prices in the C2, C3 value chain, and even further down, you see this volatility, and you see the escalating raw materials. I'm saying, you know, we are developing quite well in line with those movements. What is decisive in this situation is how fast you are able to roll over and how fast you can do this. With our EUR 3,000 average order size of our customers, we are fortunately in a situation to do this quite quickly and quite rapidly. This is contrary to many manufacturers which have sometimes quarterly pricing contracts or even half-year contracts, which makes it difficult for them to roll over a new pricing on the raw material side. That is causing sometimes a margin squeeze. Whereas we can play that, obviously with our sales force and with our sales organization quite well. Great. Thank you very much. The next question coming from Dominic Edridge at Deutsche Bank. Your line is now open. Yeah. Hello. Thanks for taking the questions. Just a few for me. Just obviously coming, maybe asking again about the points about normalization on pricing. Would you expect to see markets like, say, the U.S., which typically is much more self-sufficient for chemicals, sort of normalize first out of your major markets? I f so, are you seeing any signs of that at the moment? The second question was the benefits from obviously having your own transport network versus peers. Do you think that is working well at the moment, you know, maybe versus the ones who have to outsource to third-party logistics? A re you sort of seeing some benefits of that coming through in results? T hen the third question was just on digital. Could you just say, you know, in terms of the customers, is it basically just onboarding your existing customers, or are you winning any new customers who maybe are happy to deal with you in a slightly different fashion? In terms of the benefit for you for converting customers to digital, can you give sort of any idea, from what's happened already, what kind of benefit you get, from having say, a digital relationship to a customer versus the traditional relationship? Thanks so much. Yeah. Dominic, thanks a lot. Yes, I think your hypothesis is correct. My anticipation is that normalization in the U.S. could happen the first and the fastest. Now, let's wait. You know, hurricane season is over, that's true, but let's wait whether we are hit with another ice storm or we are hitting with any inefficiencies. The infrastructure in U.S. obviously has also. Your hypothesis is correct. Currently we don't see any normalization there. Even on the contrary, I would say. I think there's a great opportunity still in North America and how we drive our earnings growth there forward. Now transport. Also let me be very clear and very specific about it. We have by far the largest transport capacity internally, as Brenntag, even in the U.S. This is, you know, we have, I think 1,200 trucks. We have about 2,000 trailers. We have, you know, a massive amount of truck drivers, which are dedicated Brenntag DNA-branded drivers. T hey have a high identification with the company. They're very proud to be a Brenntag driver and truck driver. This has played out a lot to our benefits, because about 60%-70% of what we are doing is covered by our own drivers. That is, you know, not only from a safety standpoint of view, but also from a brand standpoint of view and from a reputation standpoint of view, an invaluable asset which we have. Again, this is what we balance out, of course, by sourcing the remainder 20%-30% externally. You know, we have been blessed, if I may say so, with the highly loyal and strong truck driver community we have globally, not only in U.S. In Europe, it's the same. Asia, exactly the same. I think this is, you know, a real benefit. Also in our acquisitions. We just recently, when we took JM Swank, we have, you know, received a substantial amount of trucks again with this one. I think it is actually a benefit for us. On the digital onboarding, I mean, it's easily said and difficult to be done. I mean, difficult to be done because many times customers saying, "I don't wanna go to the digital platform because I wanna have in contact. I'm a specialty customer. I wanna have somebody I can talk to when I need application advice. When I have an issue with applying, you know, one of the products of the large manufacturers, they would never get airtime at them because they're so small. T hey come to us, they talk to us, and then some people say, "Okay, it's a nice feature what you have on the digital platform, but this is not for me. I wanna still send you an email and you put it into your system yourself." L et's talk reality now. There is of course an increasing number of customers who are saying, "Hmm, if I can have a one-click reordering process for my drum of acetone I get frequently from you, that's what I would like to do." This is, you know, where we are of course offering that platform and need to design it and therefore design it that way. That is the easiest way to do business with us is through the platform. Why we do this? To answer maybe that question is, of course, it's an efficiency gain as well. If this is all automated, you know, there's nobody involved to put an order which comes by email into the system. It flows automatically there. Again, you know, it's also part of our go-to-market approach to push for these digital channels, in particular in customer segments, which we consider as important for Brenntag. Overall, you know, on being in a segment of customers where the most efficient way to deal with them is actually through a digital channel. Thanks a lot for that. Can I just ask one follow-up on that last point? Not now, obviously, but in a much more normal supply demand market, could you imagine maybe incentivizing some customers to move online, i.e., by saying, "Look, we know there's a benefit to us from this. Maybe the price on the pricing side, there could be something you could give to sort of encourage people to move a bit more online within certain categories of customer. I think we are playing here the whole toolbox of convincing customers to go on the digital platform. To be honest, what I observe in many cases also, customers are quite happy to do that because they said, "I don't want to be bothered with a salesperson every two weeks you send me. It's just stealing my time." I think we need to be honest here and clear, and see what reality is. I think this trend will be strongly emphasized going forward. I mean, you clearly will see it, but it is a mixed bag. It's not a singular answer, A, B, C will happen. It is, you know, you need to really differentiate to look at that. I believe, you know, that opportunity is something we must for Brenntag. It's an additional sales channel we need to play, and we need to play them diligently and with the right measures. Thank you very much. Next question is coming from Rajesh Kumar at HSBC. Your line is now open. Hello, sir. You mentioned an average order value per customer earlier. C ould you give some color on how that differs by bulk versus specialty? I f you've seen any differences in the dynamics in terms of how prices are moving in those two segments. I'm sure you've answered the question differently, but just the average order value statistic was reasonably interesting. Y eah, trying to get to that. The second question is on a follow-up on what Andy was trying to understand earlier. Earlier this year, late last year, you mentioned that you know, you had certain clients where you know, the pricing was not appropriate, so that even a small, very small portion of the business was making a gross loss rather than gross profit. Are you in a position where those loss-making contracts have been exited, or is that something you still need to do through 2022? The final question is on when analysts like us are trying to cast our numbers for 2022 and 2023, should we be looking at the quarters where you've had, you know, price inflation tailwind? Should we reverse some of the margin gains we've had in, you know, last couple of quarters and first two quarters of 2022, because of the pricing tailwind? By margin, I mean conversion margin, not the gross margin. I appreciate the gross margin fluctuates. Rajesh, thanks a lot. Maybe I have not fully understood the first question fully but let me answer what I understood. The average order size is indeed EUR 3,000. And that's of course the average. You know, I think about 3 million transactions every year, 3 million roughly. That tells you know, that, you know, we have everything from, you know, actually a tank truck of caustic soda, which is typically, I don't know, 32 tons or something, down to really a food ingredient which is sold, let's say, in a 25 kg bag or in a 50 kg bag, and even down to, let's say, in the biopharma business where we are in Asia after our acquisitions of Tee Hai, where we actually sell boxes of, I don't know, 300 ml. It's actually very differentiated, wherever you are. Of course, in all those segments, the pricing mechanisms are different. What we want to make sure with our new operating model is that, you know, we have with a differentiated steering approach towards the industrial chemicals versus the specialties field, that we have specialized sellers now in the market who only, for instance, sell those 25 kg bags or food ingredient or a blend for an application, and is not trying to sell a tank truck of caustic soda in the afternoon. That doesn't work. This is what I always was clearly convinced that we need to separate the sales forces because the pricing mechanism, the value add in both divisions is totally different. I think we are making very good progress in that. That, I believe will help us to keep the pricing momentum going forward. Answering your second question. In times of these extreme shortages or allocation gains, we have taken deliberate choices not to serve customers who are not giving us the value which we deserve. That, I think, has worked out rather well. It's easy, of course, if you have to take a decision and you say, "I only get 30% of my demand of silicones," because the market is extremely tight and extremely short. We take deliberate choices whom we are going to supply and at which price level we are going to supply. That I think has also made clear that we corrected some of those topics I mentioned a year ago, that we have a business which is actually diluting our margins and is actually not giving us the returns for the services we are providing. Now the conversion margin, I'm actually quite positive that the conversion margins as we continue to execute and work on Project Brenntag is on a level which we are able to maintain. This is clearly our ambition to make sure that you know this is not leading us back to where we have been a couple of years ago. I believe in 2022, with the expected volume recovery, a normalization of the pricing level, the consistent and stringent execution of Project Brenntag, will be a combination which will help us to preserve the conversion margins you see today. Perfect. That's very helpful. Thank you. As a reminder, if you have a question for our speakers, please press zero one now to enter the queue. We have a question coming in from Simona Sarli at Bank of America. Your line is now open. Yes. Good evening, gentlemen, and thank you very much for taking my questions. So just one clarification. If I look at Project Brenntag in Q3 contributed roughly EUR 29 million. At the beginning of your presentation, you made some remarks saying that typically you would have expected in tight market conditions, Essentials to grow actually faster than Specialties. What is the reason why you see rather like a faster growth in Specialties? Is it because this EUR 29 million contribution is mostly related to Specialties, or it's because you are gaining market shares in Specialties? Oh, Simona Sarli, thanks for the question. The remark was specifically showing or should address the topic that when you look on the market circumstances, we are operating in it. Typically, you would see the industrial chemicals business being favored because of the shortages, the volumes you're turning, and of course, the short-term pricing opportunities you have. Pricing is indeed even faster and more agile in essentials than in specialties. Still, specialties could grow faster than essentials according to our medium to long-term expectations. Exactly what we were expecting when we had created this new operating model. This is underlying our position in the specialties field and is showing what we are able to accomplish with our differentiated approach now, and as I said, with the dedicated sales forces. It has nothing to do actually with the Project Brenntag allocations, as you know, because we typically don't allocate them one-on-one into the divisions. Of course, you have some impact on the sales forces here, but still we have a lot of shared elements in the organization, like, for instance, the customer service desk, which is, you know, one Brenntag because here you don't need a differentiation because it's more transactional and has nothing to do with the customer interface at the end of the day. It's not driven by a Project Brenntag allocation. It is really, you know, showing that the potential of the stringent definition of our product baskets to the industry segments we are serving in Specialties is giving us an advantage, even in a situation where Essentials theoretically would be favored. Okay, thank you very much. One last question, if I may. If you could please comment on today's news that your guest is deciding not to renew his mandate next year. Yeah, if there is already also a plan for a successor. Thank you. Yeah, we'll probably let Georg answer the question. He's the right guy. It's probably for me, Simona. Thanks for the question. See, I'm very rooted in Brenntag. I'm doing management functions at Brenntag now for almost 20 years, and it has been CFO 10 years, and it has been a hell of a positive ride. I mean, the company has taken a magnificent development since then and is very well-positioned today. For all of us, at one moment in time, you have to decide when to pass on the baton to the next. I feel it is for personal reasons a very good moment in time for me to pass on the baton. I decided early for personal reasons. Under German corporate governance, succession is in the hands of the supervisory board, and they are dealing with the succession question in a very careful and diligent manner. We'll let you know if and when there is news about succession. Thank you. Sure. The next question has come from Christian Obst at Baader Bank. Your line is now open. Thank you. I have one last question concerning a little bit about the market structure. Do you see any among your thousands of customers, do you see any change, structural change in buying patterns, meaning that they try to diversify their supply chain? And are they asking you for help or support to get maybe another supplier for each and every product they are buying? Is there some kind of a structural change on the way because of the current disruption we have seen and still seeing? Thank you. Hey, Christian, thanks for the question. Yes, I see that. It again has been already when the pandemic started, but it continues right now. Product availability is really important. Of course, we have numerous customers who are not our customers, potential customers knocking on our doors and asking whether we can help them. Even really strong brand names you all know where we could on short-term help because the supply out of China was significantly reduced or cut off. They desperately were asking for support for a simple product like citric acid. We could help them on short notice with our European supply chain. That, of course, is opening up doors. It's opening up commercial discussions which would never happen before. You know, people recognize the strength Brenntag has by being able to play those different value chains. It is also of course raising the question on many of their customers with whom they wanna team up and with whom they wanna work together. Also, in particular, our global footprint is extremely strong and important for, let's say, large customers who are saying, "Can you supply our chemical demand on our 50 plants we have globally?" Today, it's almost clear, it is obvious that we are the very few player, or if not the only one, who can cut, for instance, a global quality assurance agreement. 'Cause those chemicals need to be supplied with certain quality standards to those facilities worldwide. That is also a shifting pattern. The people recognize more and more that, you know, being the global number one and having that strong global position is actually a good reason why to consider Brenntag as a potential supply partner and supplier in the future. This means that this structural development is some kind of an additional source of growth above market average, right? At least in the midterm. Yeah. I think that's true. If you combine this with Project Brenntag, and that was always the intention. This is why we have actually created that new operating model, to have the differentiated approach with the lowest cost to serve in Essentials, with the value-added service focus with a very clear product definition of what is in the Specialties, will give us advantages in both divisions going forward. I'm really convinced about this. Okay. Thank you very much. You're welcome. The next question coming from Isha Jha at Jefferies. The line is now open. Hi. Thank you for your generous time. Just a follow-up on the conversion ratio. Is your comment on keeping the ratio at the current level in reference to what you have seen in Q3? And is the profitability at both segments a good main benchmark to look at going forward? Again, I think we discussed around, you know, the conversion margin and the good picture we have seen the full year. I would not take now one- quarter and take that and saying, "This is it," and we will be able to maintain that at that level. Again, you know, I believe on the gross profit side, you know, we have seen, you know, very favorable situation on the pricing side. On the conversion margin it's to a large extent our homework. It is, you know, how we deal with our cost base and how we manage that. You will see the impact of Project Brenntag materializing as we have predicted. You know, one year ago, we had our capital market update for the first time. There we, you know, showed the EUR 220 million. We have EUR 70 million there. That was roughly a third of what we have promised to you. I think, you know, you can count on that we are executing Project Brenntag according to our plan. That will of course support our conversion margin development quite well and quite nicely. From that perspective, I think we do all the right stuff to maintain that as much as possible. Thank you very much. Ladies and gentlemen, we have no more questions waiting in the queue. I would like to hand over to Thomas Altmann to conclude this conference call. Thank you, Lucas. This brings us to the end of the conference call. Thank you very much for joining us today and your interest in Brenntag. If you have any further questions, please don't hesitate to contact us, and we will publish our full year 2021 results on March 9, 2022. Until then, we are looking forward to further discussions with you. That's it for today. I wish you all a good day and a great week. Thank you and goodbye. Ladies and gentlemen, thank you for your attendance. This conference has been concluded. You may disconnect.