Good morning, ladies and gentlemen, welcome to the SAF-HOLLAND Conference Call on Financial Year 2021 Results. Please note that this call is being recorded and streamed on SAF-Holland's website. I now hand over to Petra Müller, Head of Investor Relations, Corporate and ESG Communications for introductory remarks. Thank you, operator, and welcome everybody to our Full Year 2021 Results Presentation. This call is being broadcast live over the internet at saf-holland.com. A replay of the call will be available on our website shortly following the conclusion of this call. Joining me today are our CEO, Alexander Geis, and the Vice President, Group Accounting, Controlling, and Tax, Jörg Wahl. Alexander will start with an overview of the markets in general and the development of our regions. Jörg will provide some more detail on our key financials, followed by Alexander again, updating you on our guidance and current developments. After these introductions, we will be happy to take your questions. Please note that management comments during this call will include forward-looking statements, which involve risks and uncertainties. For discussions of risk factors, I encourage you to review the safe harbor statement contained in today's press release and presentation and in our annual report. All documents relating to our full year 2021 reporting are available on our website. Now, without further ado, over to Alexander. Thank you, Petra. Good morning, everybody, and thanks for joining our call today. Let's start with a short summary of KPIs for last year. 2021 was a turbulent year full of challenges due to the pandemic and inflation, but thanks to the outstanding execution of the entire SAF-Holland team, we mastered it well. We have delivered good profitability and improved our major financial KPIs. Based on strong demand, we achieved sales of EUR 1.247 billion, a +30% versus 2020. Adjusted for FX effects, sales grew by 32%, and our Adjusted EBIT margin reached 7.5%, 140 basis points up versus 2020. With these figures, we fully achieved our guidance. CapEx ratio was 2%, slightly lower than forecasted, as sales went up significantly. Our net working capital ratio increased to 14.8% due to the strong business leading to higher inventories, higher trade receivables, and higher trade payables. Jörg will show more details later. Now looking at the various markets. Here we saw a very strong demand across all regions. EMEA showed good growth, both for trailers and trucks of 21% and 29%. We were able to increase our sales in the EMEA region by 33%, which means growing stronger than the market. In North America, expectations on market growth were certainly higher, but with 28% growth for trailers and 19% growth for trucks, growth was remarkable. Trucks were somewhat constrained by the semiconductor shortages, while that is not so much the case for trailers. Brazil and India grew strongly, both on the trailer and the truck side. China markets went down quite strongly, but we were able to compensate some of that with a very strong Australia and India performance. Let's talk about EMEA and the business development. Sales here increased by 33% to EUR 734 million. Adjusted for FX, the increase would have been 34%. Business was driven by strong OE and aftermarket business. Our German and Turkish plants were highly utilized during the year 2021. Q4 was very strong with a year-over-year increase in sales of 28% to EUR 189 million. The spike in steel prices, high freight rates, and high energy costs caused a headwind on our gross profit. Adjusted selling expenses developed nicely, and the ratio to sales came down to 4.8%. Despite the strong cost headwind, our Adjusted EBIT margin of 9.2% for the full year was nearly on the 2020 level. As you can see on the slide, Q4 margin came down by 400 basis points to 7.3% due to the usual time lag in passing on steel price increases to our customers. That led to some margin pressure in the OE business. Worthwhile to mention that we had some positive one-offs in Q4 2020, which led to the high EBIT margin the year before. Now, Americas. Sales in our Americas region grew by 21% to EUR 402 million, driven by a strong truck OE and aftermarket business. Also, trailer OE business strongly contributed year-over-year. Sales adjusted for FX effects grew by 25% in the region. Q4 sales of EUR 101 million were driven by a very strong trailer OE business as well as a strong aftermarket business. Here, despite the steel price increases, freight rates, energy costs going up significantly, the full-year Adjusted EBIT margin was up to 6%. Adjusted admin expenses to sales ratio improved to 4.6%. In Q4, the margin increase to 7.5% was mainly driven by our Forward 2.0 restructuring achievements and our strong aftermarket business. Now speaking about the APAC region. Sales increased significantly by 48% to EUR 110 million. FX had no major impact in 2021. Sales growth was driven by strong OE business in India and a favorable growth in Australia. In Q4, sales increased by nearly 49% year-over-year, driven by strong trailer OE business. Cost of sales only grew less than proportionally by 38%, and adjusted admin expenses to sales ratio improved 290 basis points to 6.6%. While the Adjusted EBIT margin was -9.8% in 2020, we recorded a positive Adjusted EBIT margin of 1.7% in 2021. The significant increase in the Adjusted EBIT margin is mainly driven by the strong business development, both in India and Australia. In Q4, we saw a strong Adjusted EBIT margin improvement to 1.1% from a -9.8% in Q4 2020. Slow China business impacted the even better margin development in our APAC region. Now, let me hand over to Jörg for a detailed walkthrough of our financials on the group level. Thank you, Alex, and welcome everybody. As Alex already showed earlier, group sales grew significantly by 30% year-over-year to EUR 1,247 million. We saw a positive contribution in all four quarters in 2021, with the highest growth being recorded in Q2. This strong performance was driven by both OE and aftermarket business in all three regions. EMEA and Americas account for more than 90% of our sales. EMEA sales share went up by 140 basis points year-over-year, while the share of Americas' sales declined by 240 basis points compared to prior year. APAC sales share, on the other hand, went up by 100 basis points. While adjusted gross profit increased by 21%, adjusted gross profit margin came down slightly to 17.4%. Cost of sales were impacted by high cost inflation. Alex already mentioned the spike in steel prices as well as high freight rates and higher energy costs. Price increases, a positive product mix, and efficiency improvement could only partially offset the high cost burden. We have implemented price increases at all our customers. Please bear in mind that since those price increases usually are implemented with a time lag, we will only see an impact in 2022. On the other hand, we currently see continuously rising material prices, energy, and logistics costs. Despite the cost headwind, our Adjusted EBIT increased by 58% to EUR 93 million. Operating leverage, cost measures, and fixed cost discipline supported the margin increase. Adjusted EBIT margin went up to 7.5%, compared with 6.1% in 2020. Our adjusted net profit went up by 78% versus 2020. The financial result improved to -EUR 9.4 million. One reason is lower interest rates because of better leverage. Another one, a positive balance of realized and unrealized FX gains and losses. The undiluted adjusted EPS increased to EUR 1.35. Operational adjustments on EBIT level came down year over year from EUR 27.7 in 2020 to EUR 21 million in 2021. We saw significantly lower restructuring expenses of EUR 4.2 versus 13.6 million in 2020. In 2021, we booked an impairment for our Chinese operations of EUR 4.7 million as our business in China so far did not develop as expected. Adjusted net profit increased by 79% to EUR 61 million. Reported earnings per share increased from EUR 0.30 in 2020 to 0.81 in 2021. Based on the very good performance in 2021, the management board and the supervisory board will propose a dividend of EUR 0.35 per share to the AGM in May 2022. This corresponds to a payout ratio of 43% and is in line with our general dividend policy. While net debt was more or less stable year-over-year, leverage improved significantly from 2.4 to 1.58, driven by higher EBITDA. Equity came up to EUR 371 million, driven by strong net profit for the period, as well as FX differences from the translation of foreign operations and the revaluation of defined benefit pension plans. Equity ratio increased by 400 basis points to 36.6% in 2021. CapEx of EUR 24.7 million was stable compared to prior year. With our disciplines and focus investments, we improved the efficiency of our plants in Germany and added some capacity in Mexico and Turkey. Against the backdrop of the Ukraine conflict, all investment in Russia are currently on hold. The significant sales growth led to a lower than guided CapEx ratio of 2% instead of 2.5%. Net working capital went up to EUR 184 million, which corresponds to a net working capital ratio of 14.8%. This was driven by higher inventory to secure our delivery performance, as well as higher trade receivables and higher trade payables due to the high demand and high production volumes. ROCE improved by 460 basis points, mainly driven by higher Adjusted EBIT. The cyclical rebound of net working capital burdened our operating cash flow in 2021. Net operating cash flow was clearly positive at EUR 40 million, and cash flow from investing activities was stable year-over-year. However, the cash conversion rate was impacted by the substantial increase of net working capital due to strong business in 2021 and came down to 48%. With this said, I would like to hand over to Alex again. Thank you, Jörg. Now let's have a look at our expectations for 2022. According to external market research from this institute, truck and trailer markets will grow in 2022. However, these figures were published before the conflict between Russia and Ukraine started. We all do not know what the exact impact will be, but it is likely that these figures will change during the year. We have put our investment in Russia on hold. However, demand from customers in the EMEA region is on a very high level, and we have a strong backlog in our production. Our plants in Germany and Turkey are currently fully loaded into Q3. In North America, truck production is expected to be further impacted by supply shortages, which could gradually diminish towards the end of 2022 or beginning of 2023. On the trailer side, the challenge for the OEMs is to further ramp up their productions and labor shortages. On the other hand, supply chain issues seem to improve slightly. In Brazil and in India, we expect large infrastructure programs to be a driver for further growth. China, on the other hand, it is expected to be still subdued in 2022. We have talked about the demand side. Now let's have a look at the cost side. Major cost items are material, labor, freight, and depreciation. Steel prices are still on a very high level in the U.S. and in EMEA, and prices will most likely go further up due to the conflict in Ukraine and the increasing energy inflation. Supply chain disruptions started to ease slightly, but with the Russia-Ukraine war, we expect that it will get tighter again. Labor costs will be up due to inflation and the increase of minimum wages in Germany. As we increase capacity and build up new lines in Turkey and Mexico, we of course need additional staffing. Freight rates remain on a very high level and also most likely will go further up. Energy costs went through the roof since the Russia-Ukraine conflict started, so this will be an additional burden. Up to now, no one knows to what level energy costs might rise during the year. Our depreciation for 2022 will be up slightly, driven by our capacity expansions. Of course, we try to countermeasure cost increases as good as possible. First, we pass on higher steel prices to our customers. We had a price round beginning of January. We'll have another one in April and most probably also in the middle of the year. As you all know, there is always a certain time lag between us incurring higher steel prices and costs and passing that on to the customers. That means in Q1 2022 will be under pressure from a margin perspective. Second, we invest further in efficiency improvements in our productions and will increase recycling further. The supplemental collective agreement in Germany is in place until end of 2024 and will help to somewhat keep labor costs in Germany under control. Let's speak about our guidance for 2022 now. The further impact of the Russia-Ukraine conflict on supply chains, commodities, and energy prices, freight rates, and inflation, as well as on global GDP developments, is currently not foreseeable. Taking all the aforementioned into account, our guidance for 2022 is as follows. Based on a good order book at the beginning of the year and a very good utilization of our plants, we expect group sales to be between EUR 1.15 and 1.3 billion. As pointed out, we informed our customers about additional price increases beginning of the year and will see some more coming towards April. However, given the current raw material situation, the massive inflation and higher pay costs, which puts pressure on our gross profit and EBIT, we expect our Adjusted EBIT margin to be significantly below 2021. CapEx ratio should be between 2% and 2.5%, and due to the investments in Russia being on hold, CapEx most probably will be towards the lower end of the range. Now let's also talk about our ESG focus for a moment. ESG is a focus area, and I believe we are all on a journey. We at SAF-Holland continuously work on ESG and are happy that three important sustainability rankings show good to very good scores for SAF-Holland. MSCI rated us with AA and puts us in the top 8% of our industry. We are ESG industry top-rated by Sustainalytics, which show a low risk for SAF-Holland. Our rating with ISS ESG currently is at C level, and the rating puts us in the top 22% of our industry and confirm that we have a very high transparency level. We intend to keep pushing forward with a continuous improvement in mindset on these important topics. We consider the impact on society as a whole, including suppliers, customers, employees, and our shareholders. Sustainability covers more than the green area. Sustainability at SAF-Holland is aligned with the UN Sustainable Development Goals. Safety standards are fundamental for our products. We have a high quality focus and put an emphasis on safety in our working environment through the safety programs that we use to protect our employees. We are ethical in our business and our supply chain, compliant with our code of conduct. We are a company with skilled, dedicated employees, and we encourage a diverse and inclusive working environment. We, as the management team, decided that we want to focus on two major topics to strengthen ESG in the company. First focus is on the social aspect. We want to position ourselves as a globally attractive employer by promoting a tolerant, fair working environment and lifelong learning. For us, human capital is one of the most valuable assets. The second focus area is on climate protection. We strongly believe that there are many topics where we at SAF-Holland can work on to make a difference with regards to emissions and the circular economy. Now, let's have a short look on the mega trends for our industry and give you an update on our strategy. We believe that despite the terrible war in Ukraine and the immediate effects we currently see, the mid-term development for our industry is very good. As you can see on slide 23, we show a CAGR growth of 8% between 2021-2025 for the markets which we are relevant for SAF-Holland. Of course, all calculations were based on external market research institutes expectations before the Russia-Ukraine conflict. The point is that the 8% CAGR value is not the most relevant figure. What is obvious is that we operate in a growing market, not maybe growing with the same pace every year, sometimes more, sometimes less, but steadily growing. Megatrends such as urbanization, higher mobility, digitalization, and the focus on sustainability drive industry trends in the trailer and truck market. These comprise topics like security, electrification, connectivity, and automated driving. We at SAF-Holland provide products that can help to increase customer value. On the next slide, you can see some examples how we can help our customers to save costs and to reach their own sustainability targets. Let's talk about innovation for a second. Quality and innovation has been the foundation of our success in the past, and we will build further on this in order to increase market share and drive market outperformance across all regions. We have talked about our E-axle family, the TRAKr and TRAKe, our fully electrified axles before, and we will start serial production for the TRAKr now in March. The push for lower emissions will intensify and our SAF TRAKr recuperative axle helps customers to reduce fuel consumption and reduce CO2 emissions. With our TRAKr axle, we won the European Transport Award for Sustainability and the Truck & Fleet Award in 2022. That's a good achievement. Our telematics system, TrailerMaster, on the other hand, pays into the topic of digitalization. It links components and helps to communicate between trailer, driver, and fleet operator. The fleet operator can plan predictive maintenance, lower repair and maintenance costs, and extend utilization of the trailer. Also worthwhile to mention that we won the second place in the German Telematics Award in 2022. Last but not least, let me conclude with the management focus areas for 2022. As you can see, the margin recovery was on track in 2021, and 2022 will be a challenging year again. Apart from the Russia-Ukraine conflict, there is also uncertainty about development of the COVID-19 crisis, but we will monitor all developments very closely and of course, will react as quickly as possible. We continue to strengthen our equity story and will drive the portfolio optimization and growth. I just showed you two examples on how we build on our innovative strength. I also talked about our ESG focus some minutes ago and how we want to strengthen our contribution to a sustainable economic development. Efficient capital allocation is important to us, and we stick to our M&A strategy, focusing on value creation for our shareholders. We continuously watch out for opportunities and review our own businesses to create a maximum value for our shareholders. With this, we close our presentation. Thank you very much, and we are open for the Q&A session. Thank you. If you would like to ask a question over the telephone, please signal by pressing star one on your telephone keypad. Please ensure your mute function is turned off to allow your signal to reach our equipment. Again, it is the star or asterisk key, followed by the number one, to pose a question. We will take our first question today from Jorge González of Hauck Aufhäuser. Please go ahead. Your line is open. Hello, good morning. Thank you for taking my question. Hi, Alexander and Andreas. I would like to ask you regarding the outlook. My first question will be if you are taking into consideration some cancellations in this range that you are giving for your sales in 2022. It surprised a little bit to me that with the price increases that we should be seeing this year, you are expecting volumes to go down. It would be interesting to know if you are already experiencing some cancellations or it's just that you are expecting a worsening of this conflict in Ukraine and Russia. Apart from that, I don't know if you can be a little bit more specific on the exposure that you have to Russia in terms of sales and the impact you are expecting in EBIT. I don't know if we should be expecting something close to five or something closer to two. It will be interesting if you can elaborate a little bit on this. Thank you very much. Of course. Let me take the first question in terms of our outlook and cancellations. Yeah, we already put in our outlook some cancellations. We can see, first of all, or firstly, this is, of course, the Russian market, and Jörg will speak about that a little bit later on, how big the exposure for us is in the worst case scenario. We are also a dominant player when it comes to axles, trailer axles for the Russian market. We sell to all major trailer manufacturers there. Of course, we can see now with the conflict starting nearly four weeks now, three weeks ago, that we paused our supplies into the Russian market, so this will burden, and this is already considered in our outlook. Secondly, we also have some Western and Eastern European trailer manufacturers and also truck manufacturers who do export into Russia. With those, because they're also very uncertain, specifically when it comes to the payments, we can see already some cancellations, not many, but there are already some coming in. This is also incorporated in our outlook already. With regard to the sales impact from Russia, we expect a single-digit percentage with regard to our group sales as an exposure that might hit us from the loss of the OEM sales business directly linked to our Russian subsidiary. Okay, thank you very much for that. Only one follow-up, please. How the scenario from this point needs to change for us to see the most optimistic part of your guidance, please? Well, as I mentioned before, our guidance is between EUR 1.15- 1.3 billion. As you might know, we are rather conservative than really bullish. We took already cancellations and the missing sales of Russia into consideration. On the other hand, we have a really, meanwhile, good sales in the APAC regions, specifically in India and in Far East Asia and Australia, and also the North American market. All three, Canada, U.S., and Mexico, is developing quite nicely in terms of sales. Demand is there, people are investing. From that perspective, all the, let's say, missing sales, or the missing sales we expect to see coming from the conflict, we considered already in our guidance. Okay. Basically. I'm not giving you anywhere where we're gonna end. Our guidance is EUR 1.15- 1.3 billion at this stage. Okay, I understand. It's basically you are reducing your expectations for EMEA only. Maybe my final question. Can you share with us which is the indirect exposure of your clients in EMEA to Russia and Ukraine? The exposure of our clients to Russia and Ukraine? Yeah, more or less. If you have that ref, I don't know, if you have any reference of how much could be that. Well, how much time do you have? We have about 150 to 200 trailer manufacturers across Europe, both Eastern and European. If you speak about Spanish, Portuguese, if you speak about Italian, so Southern European trailer manufacturers, there is only very little exposure to Russia. When it comes to, for instance, some East European trailer manufacturers, there is a higher percentage of exposure, but it's not breaking their neck. Okay? We are talking, Russia is not the huge trailer or truck market in Europe. By far not. But of course there will be some exposure. And since we have quite a high market share in Europe, there is some exposure. But we already considered all that in a very conservative way in our guidance. Thank you very much. Okay. As a reminder, if you wish to ask a question, please signal by pressing star one. We will take our next question from Philippe Lorrain of Berenberg. Please go ahead. Yeah, good morning. Philippe Lorrain from Berenberg. A couple of questions as well to follow up a little bit on your sales outlook. You've mentioned in the press release, at some point as well that the product mix was supposed to be a little bit more, let's say, of a headwind for you this year. Would that explain as well why it seems like your price mix assumption for this year is gonna be negative, assuming that FX is stable, as you say in your guidance, and the rest like basically reflected in your numbers? That's the first question. All right. I'm gonna take this, Philippe. Good morning. This is Alex speaking. Well, the product mix is not going to change that much year-over-year. Okay? Basically we talk about trailer products. Here we also have a mass product, but also we have some niche products which are also running. On the other end, we have the truck market for us, which is mainly truck suspensions. It's the fifth wheels on both European but also U.S. side. Of course we have our highly profitable aftermarket, which is really good and strong. Well, our sales guidance is more based on the conservative approach when it comes now to the conflict. The Russian market is going very much down. You cannot, let's say, sell to trailer manufacturers without getting your money. We are very cautious on getting our money. Okay? If there's risk, we are not going to sell. That's the first thing. Secondly, as I mentioned before, you have some trailer manufacturers with, let's say a double-digit percentage in or low double-digit percentage exposure to the Russian and Ukrainian market when it comes to sales. But what really makes us headache is the increasing, heavily increasing inflation in all areas. You know, when it comes to foundries and metals, we have stamping parts. Everybody who uses energy, and energy is exploding, both normal energy but also gasoline and oil, it's going up, and this will be a big burden, specifically, my assumption, the first half year of this year. Since we have a time lag to pass that on, not everything, not every single detail is written in a contract, so it's not automatically going up. For instance, inflationary freight rates, you have to agree with your customers, and they then also have to agree with the ultimate customer, which is the fleet owner. This is a circle because the fleet owner is increasing the freight rates, which is an impact for us as a company, but also as the normal people when you go to the supermarket. This circle, in my point of view, at the moment, gives us a big bit of a headache. Fair point on the cost base. Is there as well, like, anything particular planned within the cost budget, when it comes to the Russian investments that you have put on hold now? Is there, like, any kind of impairment that you've reflected in your guidance so far? No, we did not reflect any impairment in the guidance so far. First of all, this is not a fully blown production for us like we have it in Turkey or in Germany, okay? We speak about 3,000-4,000 sq m only. The total capacity we would have had is 20,000-25,000 axles on a yearly output. Basically, we already have for many, many years a central warehouse, an aftermarket warehouse, and a storage area in the area of Moscow, and we just rent the warehouse next door. Basically, you can drive from one warehouse to the other one now, and in the second one, we installed our machinery, and the total investment is in the ballpark of EUR 4-5 million. This is not like the massive investments we did in Germany or in the U.S. or in China and in Turkey. Okay, that's good. What's your expectation for aftermarket then this year, versus the new business overall? It's again to try to understand a little bit better your top line guidance, which I understand from your point of view, of course, that you want to be quite conservative, especially since you see potential cancellations plus the dependence on all these OEMs to the Ukraine and Russia. It's just to really understand, like, what are the different moving parts. Well, you know that we are not guiding any aftermarket sales. What I can tell you, I don't think that the aftermarket will dramatically go down in 2022. This is more driven on the availability of new vehicles and the fleet you have operating in Europe but also in North America. North America is very strong. I'm happy with the development. We did a good work, so check mark on the U.S. so far. Europe is more, can all the fleets for all the goods to be transported across Europe get new vehicles to keep up with the freight demand? Or if not, what they gonna do? Most likely, you're gonna keep older vehicles. The average age of trailers in Western Europe is about four to five years. They're gonna hold that six, seven years. What they have to do, of course, they have to overhaul the running parts, both truck and the axle. If they have to overhaul the axle, then of course they need spare parts, and the spare parts are mainly coming from us. Uh-huh. We are not guiding the aftermarket for this year. Aftermarket is also impacted by price increases because a lot of parts, although we take from the same suppliers, of course, who supply us into the OE production facilities, and also here we have to deal with energy costs. Also here, we are doing new price rounds and have to increase the prices. Yeah. No, I understand the delay, of course, in passing through all the cost increases that you have. Look, another question that I've got is because you mentioned that higher wages in Germany. I've got, like, a few companies who mentioned that actually, that's a hit for probably later this year. How do you feel about that? Because I have the impression negotiations with the work councils and the unions as well were leading to a potential upwards revision to salaries more, let's say, closer to the end of the year during Q4, so. Well, the minimum wages will at the final stage by end of this year, I think it is October, will be reaching 12 EUR. It has nothing to do with our salaries for our people here, okay? Because we are a member of course, IG Metall, which is the metal union, and we pay higher salaries, of course. This is if you see the whole economy in all areas or specifically Germany, if any company who is involved in supplying, I don't know, might it be freight, in loading, in logistics, in whatever you think, if they're gonna increase the prices from 9.50 to 12 EUR, that's a heavy increase. What they're gonna do, they're really gonna pass that on and implement that in their cost. This cost then later on will increase all companies' costs at the end of the day. Mm-hmm. The next thing when it comes to salary increases, we are not there yet. What we gonna do with all the humans in Europe, okay? All the normal people working every single day, they face a tremendous increase in inflation. Meat, oil, gas. If you go to a gas station, that's horrible for all the people, you know? Mm-hmm. At the end of the day, they have to pay for this. At the end of the day, they will come back to the companies and ask for more money. This is a circle, as I mentioned before. I've never seen that before in the last, like, 25 years, I have to be honest. Mm-hmm. We are really watching this, and this will have an impact in the year, in this year. I'm pretty sure. Yeah. Just because you speak about that circle, let's say, of inflation and all these impacts that you are facing from that, and the delays in passing that through to your customers and hence the delay as well in realizing the margin, how should we think then about the targets that you have for 2023 for the Adjusted EBIT margin to be around 8%? Is there a likelihood that that's gonna be delayed just because we've got that strong inflation in the cost base, and that you're fighting, you know, basically to offset that internally and also put that through to your clients? No, I don't think so. That's reachable, and 8% is a good number for us. Mm-hmm. It's reachable. I hope that in the first half year, everything is getting a little bit better. Let's hope that the conflict in Ukraine is gonna end in the next couple of weeks. I really hope so. Mm-hmm. That we come somehow back to. Well, there will be not a normal like in 2017, 2018, so we don't think and don't calculate that there will be ever such low prices in steel, energy, like we had some years ago, you know, like three, four years ago. But it will be a new normal and basically prices are increasing. Prices for trailer increased already 3x this year. I just came back last week from the TMC, which is the trailer truck show in the U.S. The people are really bullish. Everybody is fully booked, both truck and the trailer manufacturers. They're revving up further production. Very happy. The only thing is the labor shortage. Some more companies are moving over to Mexico, installing plants to get new capacity. For them, like a 7%-8% inflation, okay, it's normal. It's like it is, but we're gonna pass that on to customers. The ultimate customer is people, okay? Mm-hmm. Normal working people. I think we have some turbulence the first half year, and towards the middle of the year it's easing a little bit. Okay. To reach the Let's hope I'm right. Yeah. Yeah, exactly. Let's hope. I mean, at this point it's just like an educated guess anyway. To just to understand, so for you to reach these 8%, so it's basically internal work on offsetting anything like on the cost side, basically price discipline towards your clients, be it in aftermarket or in OE. Is there anything more, let's say that we need to consider, that would help you to reach these 8%, or is it all achievable as I was mentioning already? It's the points you mentioned when it comes to the European side, but also for other regions. Don't forget we have two other regions. We have APAC, which accounts for 10%. Mm-hmm. I'm very happy at the moment with the development. Okay. It could be much better if China would, for us, develop much better now. We're in a good way. Specifically with the huge infrastructure projects in India, I'm happy. Australia, Far East Asia, I'm quite satisfied. They did a good job in 2021. 2022, I'm pretty sure they will be doing even much better job now. Don't forget- Mm-hmm. 35% of our revenue comes from North America or from the Americas. Here we had big issues in between 2017 into 2019. We did our homework in 2020. Now 2021, you can see we already reached 6%. Last quarter, even better. This is gonna be better in the future. If you take all three regions together, a very well-performing APAC region, a much better performing Americas region, and then a good European region, then the 8% is not rocket science. Okay. Okay. Perfect. I'm back in the queue. Thanks. Thanks, Philippe. We will take our next question from Nicolai Kempf of Deutsche Bank. Please go ahead. Yeah, good morning. Thank you for taking my questions. Nicolai Kempf here from Deutsche Bank. First of all, we appreciate that you provided guidance, as some companies are unable to do so. Thank you for that. My first question would be on the region split. I understand that supply chain issues are rather linked to Europe, but are the other impacts then, like energy, freight, labor, these global issues, or do you see one region more impacted than another? That's, Nicolai. Good morning. This is a global aspect. Okay? I would say not so much in APAC. We got price increases, freight. The driver shortage is not existing, so you have a lot of drivers. Everybody's happy to have a job in APAC. That's a good thing. Not so much in the Middle East. Middle East is also doing okay. You also have energy inflation, steel price increases in North America, but they already had that massively in 2021. This was the region where the steel prices increased the most. You have driver shortage, you have labor shortage, but a lot of companies, as I mentioned before, they moved already some years ago or now moving to Mexico to have access to the huge labor force they have down there to also reduce a little bit cost. As I said, they are at the moment quite happy with the market developments. Now at the moment, the big issues here in Europe, we already saw a really heavy increase in steel prices. Freight was going up, energy also in 2021. Now with this Russian invasion, everything accelerated heavily. Let's hope we have a peak, and it's coming to a somehow normal level, as I said, in the second quarter of this year. At the moment, it's globally, not so much, as I said, in APAC. U.S., they are living with that. In Europe, it's now really a heavy increase, and everybody has to deal with that. Just one follow-up. I think you mentioned that the Q2 this year will be especially under pressure. Is this also related to the high raw material prices? Well, I said that specifically Q1 will be margin-wise extremely under pressure. Well, the pressure continues as long as we have this war going on, and there is a shortage of raw materials and steel and components. I think that Q2 for everybody will be still very demanding. I said earlier that we are doing the next price round April 1, so this gives us a little bit of a relief. Q1 for us will be very challenging. Okay, understood. Thank you. We will take our next question from Werner Friedmann of A's and I's. Please go ahead. Hello, gentlemen. Three questions from my side. The first would be on China and the costs you took the impairment there. Can you comment a little bit more on your current production setup, your production cost, and sales success you have there? Yes. Let me take this question. This is Jörg. Hi. Yes. As you have all seen in the presentation, the outlook for China is not that promising, both for truck and trailers. We see a double-digit decline, and for sure we also anticipate this in our models, and have not only changed our assumption for 2022, but also for the years to come. Basically, what you do, you calculate a so-called value of use. This is a discounted cash flow model. You compare this with your assets you have in the subsidiary. Based on this analysis, we came to the conclusion that it is reasonable to do this impairment. This is a prudent business decision to do this impairment. As said, we have quite a good product in the market. The CBX25 is well received by our customers. However, as the market is down, they're reluctant to buy, given all the very, very high cost inflation we also see in China. Werner, to add to this, there's another complete COVID shutdown in a lot of provinces, so the people are not allowed to travel and they have to stay back home for quarantine. Massive increase in COVID cases in China, which led to our decision, okay, the next couple of weeks is not gonna get better in China, so we made this, cautious, decision. Okay, thanks for that. Second question would be on the outlook you give in the medium term, so 2023 and following. You're speaking of a strong growth outlook in EMEA, which is basically a mature market and it is on a pretty good level. Can you elaborate on the reasons you believe that there will be a strong growth there? Well, our latest update we did in end of last year and the year before was that by 2023, we are going to increase with the profitable growth coming from 2018, 2019, and the margin, EBIT, Adjusted EBIT margin will be around 8%. We stick to this. We also see the increase in transport volume. I have to go back to, unfortunately, to the COVID year, 2020, what happened, a lot of people that just ordered online, they still continue to order online. We see in 2020, 2021, a massive increase in freight space capacity needed to transport all the little boxes with the shoes or the clothes inside. This is not going to get back. The increase in volume for trucks and trailers will be increasing in all areas, mainly in Europe but also in North America. Okay. Last question would be on your comments on depreciation in the current year. You said it's gonna be slightly up. Does that include the impairment for the China operations? This does not include the China operation. This was a one-time effect we have recorded in 2021, and it's outside the normal course of business, of course. Okay, thanks for the clarification. As a quick reminder, if you wish to ask a question, please signal by pressing star one. We will take a follow-up question from Philippe Lorrain of Berenberg. Please go ahead. Yeah, thanks for taking the follow-up question. Just a quick one on energy costs. Would you mind sharing with us roughly what kind of percent of the top line we're speaking about? Is it closer to 1% or perhaps closer to 1.5%-2%, especially after the rebound we've seen in electricity prices and gas prices as well? Philippe, if I understand your question correctly, you wanna know what percentage our energy cost is in terms of our sales? Yes, exactly. Oh, that's a tough question. I cannot answer this from the top of my head. What I can tell you is that the energy costs, specifically in Western Europe, doubled or tripled, from end of last year to February, March. Okay. This is also the reason for a lot of energy-consuming productions, foundries for instance, that they are coming and asking for much higher prices because everybody is fed by energy in their production. Yeah. Do you have as well any foundries or any extremely, let's say, energy-intensive production processes? Well, we also need, of course, energy to run our productions, okay? We are highly robotized and automated, but not like in a foundry. We don't have own foundries, our suppliers do. What we have is a joint venture with a French foundry making our top plates for the U.S. market and some for the European market, where we have 33% of the joint venture. Also here we see a massive increase in energy costs, of course, which is in France. But as I said, it's Western Europe. Everybody's facing at least an increase, so double increase or a triple increase in energy costs at the moment. Mm-hmm. Let's hope they are coming down again. Yeah. Okay, perfect. Thanks. There are no further questions for the moment, and so I hand back to Petra Müller. Okay. Thank you, operator. Thank you everybody for listening. This concludes our Q&A session. The next SAF-Holland call will be on our Q1 2022 results on May 10. Thank you for joining us today, and goodbye. Thanks everybody. Stay healthy. Bye-bye.