Good day, and thank you for standing by. Welcome to the GEA Group AG Q3 2022 Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during your session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker today, Oliver Luckenbach, Head of IR. Please go ahead, sir. Yeah, thank you very much, Sharon. Good afternoon, ladies and gentlemen, and thank you for joining us for our Third Quarter 2022 Earnings Conference Call. With me on the call are Stefan Klebert, our CEO, and Marcus Ketter, our CFO. Stefan will begin today's call with the highlights of the third quarter. Marcus will then cover the business and financial review, followed by Stefan for the upgraded outlook for financial year 2022. Afterwards, we open up the call for the Q&A session. As always, I would like to start by drawing your attention to the cautionary language that is included in our safe harbor statement, as in the material that we have distributed today. With that, I hand it over to you, Stefan. Thank you very much, Oliver. Good afternoon, everybody. It's my pleasure to welcome you to our conference call today. Let me start with a quick review of the third quarter of 2022. We guided for EUR 1.3 billion-EUR 1.4 billion order intake, and ended the quarter in the upper half of the guided range at EUR 1.37 billion. This represents a year-over-year growth of 1.6% in reported or a slight decline by 0.7% in organic terms. The organic decline is not a reason to worry. Last year's order intake included a record level of large orders driven by one of the largest single orders of the company's history, the Novozymes order in New Food. Furthermore, please bear in mind that we are primarily focused on margin rather than on volume. Sales grew organically by 10.2% year-over-year, marking another record for at least 10 years. Does this growth rate mean that the supply chain challenges are now finally resolved? Unfortunately not. Compared to the prior quarter, the situation has not deteriorated, but also not gotten materially better. We, as well as our suppliers, can handle the supply chain challenges now better than earlier this year. Thus, we stick to our assumption we gave in March that we expect the situation to improve by year-end. Coming now to EBITDA before restructuring expenses. As a result of the strong organic sales growth, EBITDA improved by almost EUR 30 million to EUR 199 million. The respective margin improved by 0.5 percentage points to 14.7%. Also represents a new record level for a single quarter. Finally, return on capital employed. We crossed the 30% mark and reached 30.6% on a last four quarter basis, an improvement of 6 percentage points year-over-year, and now exceeding the upper end of the guided range of 24%-30% for the current fiscal year. In total, another good quarter despite an ongoing challenging environment, but we got increasingly used to those challenges. Thus, we upgrade our guidance for the group for fiscal year 2022. I will explain the details in some minutes. Let me now provide you some information about the impact of rising energy prices on GEA. As a first reaction to the sharp increase in energy prices, we implemented energy-saving measures. Despite the strong organic sales growth, we were able to reduce our gas consumption by 9.1% during the first nine months compared to last year. Electricity consumption declined by 1% year-over-year, and this improvement looks low at first glance. However, one should bear in mind that the electrification of our company cars increases electricity consumption. I believe these are great achievements as these savings are sticky and sustainable. Regarding energy prices as per today, we have fixed the prices for entire Q1 2023, and we have also already fixed the prices for 50% of our energy consumption of Q2 2023. The first quarter is the most energy-intensive quarter, and as we have secured the prices for it, we can already now better estimate the potential impact from the current price development for energy for entire full year 2023. The expected additional cost for energy in 2023 compared to our assumption for 2022 can amount to EUR 20 million-EUR 25 million. This would require price increases on our total portfolio of up to 0.5%, which is absolutely digestible. We are not only looking for energy efficiency improvements at our own factories and offices, we are also developing solutions for our customers to cut their energy bill and emission. We developed a completely autonomously operating feeding robot. It offers numerous opportunities for dairy farmers to reduce their operating costs. As it runs fully on electricity and most of the farmers have solar panels installed, they can significantly reduce their requirements for fossil fuels. Cutting fuel bills and emissions. Furthermore, the amount of feed waste can be reduced and also the amount of required labor to run a dairy farm. The new feeding robot can be integrated into environment with ease. In total, it adds to automation on a dairy farm. It makes life for farmers easier while it cuts costs and emissions at the same time. The automated feeding robot is, for us, another great example how new product innovations are a great contributor to achieving our Mission 26 targets. Moving on to the next slide, which focuses on the sustainability pillar of our Mission 26. In October, GEA won the Berlin Institute of Supply Chain Management Sustainability Award 2022. In the category Operations, we were honored for the contribution at innocent's new smoothie production facility in Rotterdam, Netherlands. At this facility, a smart waste heat recovery system, along with other energy and water-saving measures, was installed. This enables innocent to reduce waste stream and product losses, achieving a carbon neutral production. On the right side of this chart, you can see that GEA is one of the very few finalists. We are nominated for the German Sustainability Award, for the 15th German Sustainability Award, which will be handed over to the winner on the 2nd of December. That's a very important award. Even the German chancellor will come to hand over the prize, and we are one of the finalists. Let's cross fingers that we will win the award. At the end, even to be a finalist is a big success here. These are another great examples of how our solutions contribute to a more efficient use of our given resources. Let me now provide an update on our share buyback program. In short, we are almost done with the program, but let us have a look on the detailed numbers. As per October 31st, the most up-to-date figures, and not as per end of Q3, we repurchased so far 7.8 million shares and spent EUR 286 million. This means that we paid EUR 36.74 per share on average so far. There are just EUR 14 million left to be spent. It is highly likely that you will see an announcement with a completion of the share buyback program very soon. With that, I hand over to Marcus. Thank you, Stefan. Also warm welcome from my side. Starting with the headline numbers of Q3 2022. Order intake declined organically by 0.7% year- over- year. Last year's quarter included a record figure of EUR 167 million for large orders exceeding EUR 50 million in single ticket size. This year, these orders stand at EUR 128 million year over year, lower but still a very good result. Organic sales growth was strong with 10.2% year- over- year. All divisions delivered a solid organic sales growth, except for Farm Technologies, as the supply chain challenges are still present. In this quarter, especially Farm Technologies was affected. The strong organic sales growth translated into higher EBITDA before structuring expenses, which improved to EUR 190 million, as Stefan just explained. Due to the further improvement of EBIT during the last four quarters, ROCE considerably increased. On a year-over-year comparison, capital employed remained flat. Net financial liquidity decreased to EUR 235 million from EUR 358 million due to the increase of our net working capital and the financing of our share buyback program. During the last four quarters, we spent EUR 205 million on our share buyback program. All in all, Q3 2022 was another successful quarter in a still challenging environment. Looking a bit deeper into the group performance. Order intake grew to EUR 1.37 billion, as already discussed. In terms of end markets, dairy farming, dairy processing, and chemicals stood out with double-digit growth rate. M&A remains a headwind due to the disposals of Heating & Refrigeration Technologies. Organic sales grew by a strong 10.2% year-over-year. This growth was once again driven by the service business, which grew organically by 14.5%, but also the new machine business grew by a very satisfactory 8.1%. This results in a further increase of our service sales ratio by 0.8 percentage points to 34.5%. EBITDA before structuring expenses improved, which was mainly due to higher volume and a slight improvement of gross profit margin, especially from the service business. The increase in gross profit was able to more than compensate for the operating cost increases. Now let me continue with the figures for Separation & Flow Technologies. Order intake grew organically by 1.8% year-over-year. The customer industries New Food, dairy processing, and chemicals acted especially as growth drivers. The pipeline for dairy processing looks promising, driven by demand for medium-sized and replacement projects. In chemicals and pharma, demand is generally very favorable, but there is some risk for postponements due to the geopolitical situation. Energy is positively impacted by the high fuel prices, and beverage is improving with breweries inquiring for replacement solutions. Organic sales grew by 11% year-over-year, driven by the strong organic service sales growth of 16%. Despite the ongoing supply chain challenges, new machine sales grew by 7.1%. The service sales share increased by 1.8 percentage points to 45.7%. Forward-looking, the preconditions for further sales growth are good, as the order backlog remains on a record level at now EUR 652 million. EBITDA increased by EUR 11 million to EUR 95 million. The EBITDA margin, however, slightly declined from last year's high level of 26% to 25.2% also due to ramp-up costs related to the shift of production volume to our new factory in Koszalin. Overall, gross profit grew and more than compensated the increase in operating costs, resulting in a solid Q3 performance. Let's move on to Liquid & Powder Technologies. Order intake declined organically by 14.2% year-over-year. Large orders with a single ticket size of more than EUR 50 million remained almost unchanged year-over-year. Bearing in mind that last year's large order intake included the Novozymes order, which we have often talked about and was in the very high double digits. This year's large order intake is actually a very good figure. The order intake decline came from orders below EUR 5 million in single ticket size. Here, especially the customer industry beverages was the contributor, which reached a record figure in that order bracket last year. Looking forward, the pipeline across all markets looks still good. On a few occasions, we might see some delays in order placement, but this is not a widespread observation. New Food stands out in a positive way. Here, the pipeline looks very positive. As we receive many questions about the pipeline for New Food during the last month, let me give you some more background information. Some listed New Food pure plays experiencing a declining demand for plant-based food and drinks. This is, however, not a huge concern for us for the following reasons. First, we do not only serve the pure plays, but also the established food producers, as they would like to expand into the New Food arena as well. Second, the market is divided into three different segments or generations, as we call it. The first generation are the plant-based alternatives such as burgers, sausages, drinks, and so on. This has developed as we cut this daily business for us. The second generation are highly complex technologies needed to derive plant-based ingredients. The Novozymes project in last year's Q3 is a good example. These ingredients are needed to improve the texture of the plant-based food products. The final, third generation is cell-based food production. Like the second generation, highly complex and thus likely to come with large single ticket size. What is currently going on in the market? We still see good demand for technology for the first generation of new food products. The second and the third generation are now gaining traction. The large Novozymes order in last year's Q3 was just the beginning. This does not mean that we will see every single quarter a high double-digit order in that segment being placed, but we do see a very healthy project pipeline, and we feel very comfortable with our target to achieve EUR 400 million New Food related order intake in 2026. I hope that helps you to better understand the dynamics in the New Food market. Coming now back to Liquid & Powder Technologies quarterly results. Organic sales increased by 8.4% year-over-year. The service business contributed again strongly with an organic growth of 12.5% year-over-year, but also the new machines business grew solidly by 7.3% on an organic basis. The service sales share rose by 0.3 percentage points to 20.6%. Going forward, sales should continue to grow solidly as the backlog marked a record level with more than EUR 1.5 billion. EBITDA before structuring expenses increased by EUR 5 million to EUR 49 million. The respective margin, however, declined slightly by 0.1 percentage points to 11%. Continuing with Food & Healthcare Technologies. Order intake decreased organically by 0.2% year-over-year. The decline is due to last year's Q3 included one large order amounting to EUR 33 million. In Q3 2022, no large order was booked. The healthiness of the pipeline remains positive and has not materially changed compared to the prior quarter. Also, there's no customer industry or technology out or underperforming compared to the average. All in all, a healthy picture. Organic sales grew by 13.3% year-over-year. Both service as well as new machines grew by double-digit growth rates. Service sales increased by 15.6% year-over-year and new machines by 12.4%. This was achieved despite the ongoing supply chain challenges. The service sales ratio improved by 1 percentage point to 30.9%. Forward-looking, the business sentiment remains positive with order backlog just a touch below the record level reached in Q2 2022. EBITDA before structuring expenses improved by EUR 3 million to EUR 29 million, but the respective margin dropped by 0.4 percentage points to 11.1%. Gross profit increased, but operating costs increased as well due to supply chain challenges, higher personnel as well as high travel expenses. Moving to Farm Technologies. Order intake continued its solid organic growth rate of the prior quarter. Orders increased organically by 11.8% year-over-year and were driven by higher demand for all product categories, services, conventional, as well as automated milking equipment. The milk price development remains on a favorable level of EUR 400. However, they need those high prices to compensate for the headwinds from increasing costs for feed, fuel, equipment, and now also increasing interest rates. Nevertheless, we do currently not see a dramatic change in order behavior. Organic sales increased by just 0.4% year-over-year. While service sales grew by an astonishing 19.6% organically, new machine sales dropped by 12.8% due to supply chain challenges. Not surprisingly, this development has a strong impact on the service sales ratio, which increased by 7.6% year-over-year to 48.2%. Order backlog remains close to the record set in the prior quarter and stands at EUR 350 million. A good sign for further sales growth, but depending on the availability of supply. EBITDA increased by EUR 1 million to EUR 26 million. The respective margin declined by 0.5 percentage points to 13.6%. Finally, let us turn to Heating & Refrigeration Technologies. Reported order intake declined by 9.4% year-over-year due to divestments. The organic order intake figure, however, increased by 9.7%, driven by orders between EUR 5 million and EUR 50 million in single sector size. The general environment has not changed. Decarbonization remains a driver for our business, favoring demand for heat pumps. Furthermore, the high energy prices drive the demand for energy savings solutions. Organic sales increased by 15.7% year-over-year and represents the strongest growth Heating & Refrigeration Technologies has ever achieved in a single quarter. Contrary to the other divisions, it was not the service business which was the main growth driver. New machine sales grew organically by an impressive 23.6%, while service sales grew organically by 5.5%. Thus, it should not be a surprise that the service sales ratio declined by 8 percentage points to 35.7%. EBITDA before restructuring expenses declined by EUR 1 million to EUR 6 million and the margin declined by 0.5 percentage points to 11.5% due to the missing business in Russia. Closing the divisional chapter now, all divisions except for Heating & Refrigeration Technologies increased the EBITDA before restructuring. As in the prior quarters on a reported basis, only Heating & Refrigeration had lower sales in the quarter due to the divestments. All divisions, again except for Heating & Refrigeration, increased their gross profit, mostly due to higher volumes. Operating costs increased and were predominantly driven by our personnel and travel expenses. In total, EBITDA before restructuring increased to EUR 199 million from EUR 170 million. Excluding the translational FX effect of EUR 8 million, as we have defined it in our full year guidance, our EBITDA would have still improved by EUR 21 million to EUR 191 million. As always, after the divisional chapter, I provide an update on our net working capital development. Net working capital increased by EUR 113 million to EUR 446 million or by 1.7 percentage points to 8.9% of last four quarters sales. As in the prior quarters, the increase is due to a higher inventory level, which itself results from ongoing supply chain shortages. As you know, the shortages led to higher levels of finished goods as well as work in progress. Furthermore, to reduce the impact of shortages on our ability to execute orders, we are building up safety stock, and thus, raw material levels have increased. The increase in trade receivables is owed to an expansion in business activity. To sum it up, the increase in net working capital is not causing any concerns to me. As soon as the supply chain challenges fade, our inventory levels will decline as well. The inventory driven increase of net working capital has, of course, an impact on our free cash flow. Operating cash flow was EUR 146 million and below last year's figure of EUR 240 million. The decline is explained by the higher net working capital I discussed earlier. Last year, net working capital was a source of cash with an inflow of EUR 50 million. This number reversed to an outflow of EUR 67 million this year. Furthermore, cash out for taxes was also EUR 12 million higher than last year. CapEx-related outflow is EUR 50 million higher than last year, resulting in EUR 41 million. The increase is mainly due to investments into our new plant in Koszalin in Poland and higher replacements CapEx. In total, free cash flow is worth EUR 103 million, below last year's figure of EUR 250 million. Our free cash flow conversion ratio before restructuring traded downwards during the last quarters and stands now at 50% on a last four-quarter trailing basis. The negative trends during the last quarter is solidly explained by the increasing outflows for net working capital, which I just mentioned. Net cash, including these liabilities, decreased from EUR 264 million at the end of the second quarter to EUR 235 million. The net cash flow of EUR 84 million could not fully compensate the cash spent on our share buyback program of EUR 114 million. Let me now talk about our financial headroom. On the left, you see our available cash credit lines as well as their respective utilization and maturity structure as per end of September 2022. Apart from minor changes in the volume and the utilization of the EUR 64 million evergreen credit lines, nothing has materially changed compared to the prior quarter. Continuing now on the right side of the slide. Compared to last year's Q3, the financial headroom declined by EUR 100 million. The reason is explained by the cancellation of an unused credit line with the European Investment Bank of EUR 100 million. The decline in net liquidity is due to the increase in net working capital and the share buyback program mentioned earlier. Adjusted for the buyback, the net liquidity position, including lease liabilities, would amount to EUR 440 million and be significantly above prior year's level of EUR 358 million. With that, I hand it back to Stefan with the outlook. Thank you, Marcus. With that all being said, we upgrade our guidance for the full year 2022. Until now, we expected organic sales growth by more than 5% year-over-year, and given the development during the first nine months, we increase our organic sales growth target for the full year 2022 to more than 7%. For EBITDA before restructuring expenses, we confirm the range of EUR 630 million-EUR 690 million, but aim for the upper end of this range now. As you know, this range assumes constant exchange rates. During the first nine months of 2022, the FX effect was at EUR 17 million positive. Our target for return on capital employed has also been upgraded, and we now expect to reach the upper end of the guided range of 24%-30%. Regarding inflationary headwind, we stated in the prior quarters that the net inflationary impact on purchasing ranges between EUR 120 million and EUR 140 million. We confirm this figure as the picture has, in this regard, not materially changed. Let me close my presentation with this slide. Dear investors and analysts, thank you very much. We received a lot of feedback during the last three years on how we have improved the credibility of GEA's equity story and how we could do better. We highly appreciated any feedback from you. During the last years, we have improved our reporting and how we communicate with capital markets participants. This was now rewarded with manager magazin’s Investors' Darling Award. Among the MDAX companies, we ranked first. Almost at the same time, we learned that we are ranked in the Institutional Investor Survey, third among all small and mid-cap European capital goods companies. Ladies and gentlemen, thank you very much for voting for us. This is a motivation to keep on delivering on our promises. This concludes my presentation, and I hand back to Oliver for the Q&A. Yeah. Thank you very much, Stefan and Marcus. Sharon, please be so kind and open up the line for the Q&A session. Thank you. As a reminder, to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. Once again, please press star one and one on your telephone to ask a question. We will go to your first question. One moment, please. Your first question comes from the line of Klas Bergelind from Citi. Please go ahead. Your line is open. Thank you. Hi. Hi, Stefan and Marcus. Klas at Citi. The first question I had was on the pricing, both on orders and sales. If you could let us know if the levels were very different versus the second quarter. I get it to 6%-7% pricing on orders and around 4% on sales. To what extent you are hiking now again, Stefan, given that wages are creeping up, which is likely to be a bigger year-over-year headwind in 2023 versus 2022. How do you feel about price versus wage compensation into next year? I'll start there. Thanks. Yeah. Hi, Klas. I mean, what we see in the order intake is, you know, it's not so easy because we are not only selling components, but our best guess, best estimate is that we see about 6% coming from prices in order intake, while in sales it should be around 3%-4%. If we look to the next year, it is very clear that we have to continue with our pricing activities. By the way, I think you can also see it in the margins. I think we are one of those companies who really manage pricing very well because that is also what you can see at the moment. There is the world of companies differentiating those who are really good in pricing and those who missed it or started too late. I think in GEA, we did it really, really well. We need to continue. We will continue and increase prices, and that of course depends on the wages headwind at the moment. I mean, 1/3 of our staff is in Germany and there is still negotiations going on between the trade unions and let's see how this will end up. Headwind from wages will in 2023 definitely be higher compared to 2022. That's our expectation, and of course, we need to factor that in the prices. We also have clear actions planned for the fourth quarter already, and we will continue to increase our prices to that level which is necessary. Thank you. My second one is on orders. You typically comment on orders here for the next quarter. I'm wondering if you could give a comment now and then if I look at current orders, you're down mid-single digit a bit more in volume terms than I wanted to zoom in on Separation & Flow where orders are down 10% quarter-on-quarter when I strip out the EUR 10 million of large orders you had in the second quarter. Is there any softness here on the shorter cycle business through the quarter or is this just a tough compare as you see it? Yeah, I mean, you know that it is sometimes very difficult to really judge on a quarterly basis the business of a company like ours. That is, I mean, SFT is also. They had a very strong start with large orders in the first quarter. I mean, when we look at the pipeline to be honest, we don't see any material changes here. However, I mean, it's, we are living in the same world like everybody and of course, 2023 might be a year based on, let's say, impacted by a recession in many countries. Let's see how it will end up in next year. So far I can say we do not see any material change in the pipeline, yeah. Okay, no, that's good to hear. My very final one is on the margins front. It looks like you're going to hit 15% in the fourth quarter, given your guide, that's your 2026 margin target. 15% is in a seasonally strong fourth quarter, but nevertheless it illustrates solid progress. Can you talk through some of your initiatives here to improve margin further in 2023? I'm talking beyond just hiking prices to compensate for wage inflation. We know about petroleum manufacturing, but what about the sales excellence initiatives, your ambition to lower SG&A in the equipment business and so forth? That would be really helpful. Okay. It's a very comprehensive question, let's say, because there's a lot of activities going on to improve margins further. I mean, you know that we just opened our new factory in Koszalin. We are about shifting production to Koszalin. That also means that in 2023 we will see a bigger impact coming out of level of manufacturing costs here, for instance. That is one example. We have a lot of initiatives in service going on, where we push service activities in various countries, not only by pricing, also by having more pressure on the fields, for instance. Sales effectiveness is also a large project where we have employed additional salesmen, and we anticipate and expect that next year, therefore, we will have higher growth rates here. It's a mix from many things, and a lot of activities are going on here. I think what you can see, like you said, we are very well on track to achieve our Mission 2026. We are very optimistic that we will have this 15% margin or beyond, latest in 2026. I missed one of your questions before that you also asked for the order intake guidance for our Q4, which is meanwhile again, a habit that we do so. We also expect a very good order intake for the Q4 in the area of EUR 1.3 billion or a little bit above, so that we at the end will see a solid growth for the full year. Thank you. Thank you. Thank you. We will now go to our next question. One moment please. Your next question comes to the line of Sebastian Kuenne from RBC Capital Markets. Please go ahead. Your line is open. Yeah. Hi, gentlemen. My first question is on your comments of potential project delays. I know you said you expect a strong Q4 order intake, but you also say there's potential project delays. What end markets would that refer to? That would be my first question. You mentioned that in LPT last year was driven by strong investments for beverage, but that this seems to be not recurring. Is there some issues with specifically with the beer sector, with the brewing sector that you see coming up, given that the costs of brewing are going up so strongly? My last question for now regarding your order backlog, you seem to reprice it based on the currency environment. The backlog goes up a bit stronger than your order intake would indicate. I was wondering, if you were to clean up these numbers, are there any cancellations that you currently see? How do you see the risk of cancellations going forward? Thank you very much. Okay. A lot of questions. I try to answer the questions here. I mean, project delays are, let's say it like that. When we negotiated with customers about large projects, let's say EUR 30 million, EUR 50 million or sometimes even EUR 100 million, or we also have projects in the pipeline with a three-digit number, it is almost impossible to predict in which quarter the customer will make finally the final decision and when we can book it, because we book it only when we also normally have ensured the down payment and we can be sure that the financing is there. Of course, in a volatile world, which we are all living in at the moment, this is even more difficult to predict. We see customers thinking twice, should we do it? Should we do it in that size? And so on. Therefore, it's very difficult to predict on a quarterly basis, this kind of large project. However, what I can say, we have still a very solid pipeline. There is no material change. We don't see any downswing here or that customers are not approaching us to start new projects. That is also quite understandable because I always like to say, as you know, as long as we have human beings on that Earth who need to eat and drink something, I mean, our business model is quite safe because our customers, they will continue to produce food and beverages. Another question was with the backlog and the cancellation. We have almost zero cancellations, I would say. It is happening very, very seldom. It's extremely seldom. There is nothing which really will impact us and did impact us in the past as well. LPT benefited mainly from dairy processing and also from chemicals. This is where we saw quite good order intake during this year. Beverages were not as strong as we might have expected, but mainly from dairy processing and chemicals, we had a very good order situation here. Thank you. Maybe one quick follow-up on the dairy business, which is still 30%-35% of your revenues. You indicated in the previous call that you don't see the risk from trading down of customers, you know, switching out of cheese, for example. But at the same time, we hear comments from Danone that say they started seeing volume impacts due to the high inflation of dairy products. Basically, that they see some of their volumes squeezed in the market. Why do you think this won't affect GEA much? Maybe you can elaborate. I mean, the question would be, what is the alternative for the population? I mean, all the market intelligence we have shows very clear that there is an increasing demand for dairy, at least for the next 10 years. This has to do with the growing population and with the growing middle class. We have sometimes, let's say, being European, the different picture and different view because we hear a lot of all this vegan and vegetarian alternatives and soy milk and Oatly and things like that. If you see the world as a whole, and you know, of course, we are very international business and doing a lot of installations also in Asia, there is no question that dairy might not be in a growth scenario for the next few years. Yeah. I mean, we are very optimistic that this trend of growing demand for dairy will continue. Thank you very much. Thank you. We'll now go to our next question. One moment, please. Your question comes from the line of Max Yates from Morgan Stanley. Please go ahead. Your line is open. Thank you and good afternoon. Just my first question was around costs going into next year. You've helped us with the energy costs. We can all make an estimate on wage costs. I just wanted to understand what you're seeing in your components, because you've always talked about sort of direct raw materials as in a big part of your purchasing, it's mostly components. As raw materials have sort of rolled over and weakened, have you seen your component costs peaking or are they actually still rising because of costs like energy and energy for the people that produce your components? I guess that bit that is more difficult. How are you seeing that cost evolve? Is there any feeling if costs stay at these levels, what that kind of growth or what that net cost headwind, the sort of EUR 120-EUR 140 that you had this year might look like for next year? Yeah. We expect that also this headwind will continue. We also expect that we have to pay more for components. It might be slightly below what we saw this year, but not so significant because we believe and we think that the inflation will continue, that this is will also be factored in. It depends, of course, on the overall demand. There might be suppliers which are also selling to highly volatile businesses, which might decline during a recession next year, and therefore they come under big pressure and we could save money here. We are prepared for a continuous headwind also on the suppliers' side. Would it be fair to say if we were trying to calculate your growth cost sort of increase next year, the major components would really be things like wages and energy, and maybe the components costs in aggregate would be more level? Is that the way you're thinking about it? Um- Because obviously you have to make assumptions to price in your orders that you're placing today. Yeah. Clearly. I mean, energy doesn't play such a big role in our company, as I showed in one of my first slides. If you compare the total energy cost to our components we source, that's much more components we source. I mean, energy is this year. We will spend this year about EUR 35 million-EUR 40 million for energy, and the total spend is about EUR 2.6 billion-EUR 2.7 billion. So that's a completely different number. In our cost calculation basis and what also will be factored in our pricing is, like I said, that we expect that the headwind from our suppliers continue. We prepare for the worst, let's say, when we do the pricing, and let's see how successful we can be in all the negotiations. That also might depend heavily on the demand of our suppliers. As I said, if there is a recession in other machine building markets which are more volatile. Let's talk about automotive industry, automotive suppliers. We have a lot of suppliers who are also delivering to these industries, and if they are facing a large decline here, it might, of course, have a kind of impact on the pricing they offer to us, yeah. Okay. Just maybe a quick follow-up for Marcus. I just want to understand a little bit better on the working capital and sort of what the messaging is here. Because on the one hand, your working capital to sales is now kind of in the middle of your target corridor. Obviously there are specific reasons around supply chains why it has gone up. How should I interpret the direction of working capital here? I mean, is this level? I mean, it doesn't feel like this level from your comments is kind of what would be viewed as normalized. It would suggest that you can improve from these levels as supply chain eases. Obviously your guidance would say something else. I'm just trying to sort of square those two things and how we should think about, as a percentage of sales, the working capital trajectory from here. Our range was 8%-10%, and we were very careful with that at the beginning of the year. As you know, at the end of last year, we had a 5.1 percentage point, and we were asked by many to revisit our guidance range. At that time we said, "Well, it's gonna be, it's not gonna be an easy year for net working capital." It shows it was not. The increase was from 5.1% to 8.9% there. We are fine with the range and the guidance that we have given because we have foreseen that work in progress would increase and also inventory would need to increase looking at all the supply chain challenges which are out there. The supply chain challenges are not increasing right now. We see that they are starting to lighten up there. That's why I said in my presentation that we think that we will be able to decrease inventory again, when we look at safety stock levels for materials which were hard to get and now might start to be more plentiful in the market. Therefore, we are not adjusting the range yet because it's not a blue sky scenario out there. However, as I said, we see potential to reduce the 8.9% net working capital sales ratio again. If that's gonna be already in Q4, I can't promise, but it's not going well, so I expect that net working capital sales ratio has a ceiling out. Understood. Thank you. Thank you. We will now go to our next question. One moment, please. Your next question comes from the line of Sven Weier from UBS. Please go ahead. Your line is open. Yes, good afternoon, and thanks for taking my questions. The first one is on the statements you've made in earlier quarters, right? That Q4 would actually see the highest organic top-line growth rate. Maybe also because by Q4 you would have assumed a little bit of improvement in supply chain. I was just wondering if you still see that Q4 should have the highest organic. That's the first one. Thank you. Okay. Hi, Sven. Yeah, good question. I mean, when we met last time or during the last call, the sentiment was, of course, that the shortages in the supply chain are, let's say, reducing month by month or week by week. That's still somehow the sentiment and the feeling. However, we have to say, looking back now one quarter, the expectation was a little bit better, I would say. That there is a bit more relaxed sentiment in the supply chain. We are still struggling with a lot of suppliers to manage all the deliveries. So it might need a bit more time than originally expected. Let's see how Q4 will end up, but it's, you know, we are seven or eight weeks ahead of Christmas. I would say maybe next year it is really coming to a, hopefully, more normal situation. It will remain a challenging Q4 in terms of executing backlog and get everything delivered we request, yeah. Yeah, because if I take just the 7% organic, and I appreciate your guidance more than seven, that would only imply low single-digit organic in Q4. I guess it's going to be not so slow. Yeah. I mean, that's like you know us and like we said, we are guiding for larger or more than seven, yeah? That does not mean that we believe it's 7.0 at the end. Thank you for that. The other one is when I follow the top line guidance, the order guidance that you've thankfully given again, you look like you could be ending up with a backlog that is maybe EUR 500 million-EUR 600 million higher at the end of the year. Obviously quite a good starting point for organic growth next year. I know your medium-term guidance is 4%-6%, but it looks like it could be another year of above average growth, assuming a flat order pipeline. Yeah. That's a very good point, Sven. Also here I can confirm what you say or what you think. We will start definitely with a much higher backlog into 2023, compared to the backlog we had to start in the year 2022. That, of course, will give us opportunities to grow again with a solid number or maybe also accelerate growth. Let's see. That depends, of course, also on the supply chain issues. I mean, if this, if all the problems will be solved sooner or later, that gives us certain opportunities for next year. Yes. Thank you, Stefan. Maybe the last question I had was coming back a little bit on the New Food applications and maybe in particular the fermentation area, because I was attending drinktec in September, and I felt there was a lot of excitement also around fermentation, applying, which is more of a brewing technology, right? But also applying that in New Food, a lot of pipeline, and also for more energy autonomous solutions for the brewers. Yeah, maybe you can deep dive a little bit more on what you see on the fermentation side. I mean, you already said it's a structurally good market, but it seems to me that it's really rising at the moment. Also what you can offer to your clients on the brewing side in terms of energy autonomy with reusing the bioenergy basically in the breweries. Thank you. Yeah, I mean, fermentation is of course one of our key competencies we have in and GEA has a lot of knowledge and know-how here in that area also coming from the biopharma business, for instance. We have also here interesting, let's say, quotations out and discussions with our customers here. As I also said before, this is sometimes a very long road to develop together with our customers the right solutions. As I said before, there are some really very interesting topics we discuss at the moment with customers in the New Food area, which might be interesting. Energy saving for breweries. Yeah, that's always a topic, very clear. We are working on innovations here as well. You might remember that I also explained here, I think it was the last call, that we are also using our heat pumps in combination with a spray dryer, for instance, to offer energy-saving solutions. All our business units, they have very clear targets, what they need to achieve in terms of innovation for energy saving, because this is of course a big, big topic and, above all in breweries, especially having in mind the high energy costs. That's also on our agenda. Very clear. Mm-hmm. Maybe I can squeeze in a very final one. It's just on the buyback. I mean, you said you're kind of done. I think in the last call you said you're generally open to do another one. I guess that's still holds true. Well, we have not made any decision yet if we're gonna set up a new share buyback program. We haven't said no, but there's been no decision made on that yet. First, we're gonna finish that current program, which is still a bit ongoing. Okay. Thank you. Thank you both. Thank you. Thank you, Sven. Thank you. We will now go to our next question. Yeah. One moment, please. Your next question comes from Akash Gupta from JP Morgan. Please go ahead. Your line is open. Yes. Hi, good afternoon, everybody, and thanks for your time. My first question is on service growth, which accelerated in Q3 to 14.5% organic from 13% in Q2 and almost 9% in Q1. Maybe if you can talk about sustainability of service growth, what is driving it, and how do you expect service growth to progress in the next few years, the next couple of quarters? And was there any one-off in Q3 to explain this high level of service growth? That's question number one. Okay. Thank you, Akash. I mean, service, you know, we spoke about that also during the last call. This is one of our Mission 26 pillars. This is where we have a lot of activities going on. We believe and we trust that this growth what we see in service is sustainable. Also in the Mission 26, we promised that we wanna grow faster with service than in total for the company. There are a lot of activities going on, as I said, in all this business unit. It starts with pricing activities. It continues with putting more feet on the street, that we employ field service engineers. There is a lot of opportunities which we can convert into sales here. We are very optimistic that this continues and that we also see a growing and a faster-growing service business compared to GEA overall. Just to clarify, you think that these mid-teens level of growth can continue in future? I mean, we guided in the Mission 26 for our growth in services 5%-6%. This is what we promised. Yeah. Thank you. Basically, the growth will come down to 5%-6% from these high levels. Mm. If I understood correctly. Not necessarily. I mean, of course, it also depends how inflation continues, yeah. Because this also might have an impact here. I think what you can see that we deliver what we promised, that we are working on service activities, that we see the appropriate growth coming out of service and that is also something where we are quite optimistic that we can continue here. Thank you. My second one is on 2020 growth where you made some comments earlier. I think, I mean, looking at 2023, there is some risk from demand, some risk from supply chain. But from your point of view, if you had to rank the two, what would be your main worry for 2023 growth? Would it be demand or would it be supply chain? The main concern you mean for 2023 in terms of sales or in terms of order intake? In terms of sales. Sales. I mean, in terms of sales for 2023, due to the fact that we have such a large order backlog, it is of course mainly the supply chain, yeah. Because the orders are in hand and when we get all the material at the right time, we might be able to execute it faster than during this year, for instance. Thank you. A last housekeeping question on corporate line. Maybe if you can say how much we should expect for Q4. I think it has been around EUR 14 million-EUR 15 million average in the first nine months per quarter. Any comment on Q4 and the level we should expect next year? Thank you. You meant the GCC expenses for Q4 or what do you mean? We couldn't quite grasp that. Yeah. Okay. The difference between the group EBITDA and the sum of four segments. Like you have one line which is negative. I was just wondering any guidance for Q4 in terms of how big that number could be. Up to EUR 20 million is our guidance. Thank you. Thank you. We will now take our last question. One moment please. Your last question comes from the line of Uma Samlin from Bank of America. Please go ahead. Your line is open. Hi. Good afternoon, Stefan and Marcus. Thank you for taking my question. My first one is on the restructuring progress that you have made. Could you please give us a bit of an update on how much that has been realized since your last CMD? I recall that during the CMD last year, you mentioned about EUR 90 million of EBITDA impact from the procurement and around EUR 60 million from production optimization. Can you sort of give us a rough idea on how much of that has already been achieved this year, and how much more that we have to go? Let me just get that for you actually. Okay. So far this year, I can give you a number. Restructuring expenses in the EBITDA so far this year were slightly above EUR 38 million. Okay. That includes Q3 for the first nine months. For the total year expectation, could be another up to EUR 20 million. Okay. That's very helpful. Thank you very much. Do you think that, you know, given the process still ongoing, there is a potential to do more than what you had expected a year ago or it's roughly the same? I mean, we gave an overall restructuring guidance till 2026. Right now we are not changing that. Okay. Thank you very much. My last question is on the sort of the demand picture in terms of the end market into the next year. I guess given we have seen a slowdown in the new build market and also we have seen quite high inflation, you know, from the food and beverage manufacturer side. Where do you see on the market in terms of the demand drivers into next year? And what are the sort of key areas of focus you have internally to drive further orders growth in the next year? I mean, we expect everything we see from our pipeline, and it's quite good foreseeable at least for six months or so, is that we see a continuous interest in our products, in our technologies, in our solutions. There is nothing which would worry us, and no indication that it goes down at that stage. However, we are all knowing that we are living in an uncertain environment. We are all knowing that a lot of economies are prepared to see a recession year next year. It also might sooner or later somehow impact the overall industry. I can just say what we see, and I can confirm that we are modestly optimistic, let's say, also that it continues at the same way next year. That's really helpful. Thank you very much. Thank you, Uma. Thank you. With that, I will now hand the call back to Mr. Klebert for closing remarks. Thank you very much. Thank you, everybody, for participating in that call. I try to conclude now our today's main messages. First of all, I think it's important to recognize GEA has again delivered outstanding performance. We delivered what we promised. If you look at the first nine months, this is really a strong order intake, a strong sales development, and especially also a very good margin development, and therefore we could raise our guidance for the remainder of the year. Secondly, I think what is also important to mention, we managed input cost inflation very well so far, and you can also see that our margins are increasing and that we handled the pricing topic, I would say, really good, and we put a lot of focus here on that topic from the very early beginning of the year. Thirdly, that goes along with the last question. We see still a solid demand in our order pipeline, and we also expect that this continues even if the environment around us might be a bit more cloudy next year than in this year. We are very optimistic. We are very well on track on our journey to Mission 26. With that, I conclude. I wish you all the best. Stay healthy and, yeah, I'll talk to you in March next year when we disclose our full year numbers. Thank you. This concludes today's call. You may now disconnect. Speakers, please stand by.