Good morning, ladies and gentlemen. Welcome to the SAF-HOLLAND SE conference call regarding the Q1 2021 results. Let's now turn the floor over to your host, Mr. Michael Schickling. Yes, good morning. Welcome to our Q1 2021 analyst and investors conference call. This morning, we have published the full set of numbers as well as the presentation slides used in this call. Your hosts today will be Alexander Geis, our CEO, and Inka Koljonen, our CFO. We will start with a presentation followed by a Q&A session. I now would like to hand over the microphone to our CEO, Alexander Geis. Thank you, Mr. Schickling. Good morning, ladies and gentlemen. A warm welcome to our Q1 2021 call. This is Alexander Geis, and together with our CFO, Inka Koljonen, we will be explaining you how your SAF-HOLLAND performed in the first quarter of this year. Our presentation consists of our highlights presented by me, followed by our financial performance explained by Inka, and the future outlook for the remainder of the year done by myself. Please, let's get started on the next page with our main KPIs. In the upper left corner, you can see that we came in with EUR 286 million, versus EUR 283 million the year before. Sales performance was mainly driven by the APAC and EMEA region. Due to structural cost-cutting measures in all regions, combined with a higher gross profit margin and our adjusted EBIT increased from 6.5% in Q1 2020 to 7.7% now in Q1 this year. Due to the rebound of markets and steady demand, our net working capital ratio increased from 13%- 14.4% in the first quarter. This inventory build-up and filling of supply chain is the main reason for a break even in regard to operating free cash flow. Last but not least, our CapEx ratio with 1.9% was a bit lower than in Q1 2020. Some more details to the group performance on the next page. Starting again with the upper left, our sales increased by 0.8%. Adjusted by FX, sales increased by 5.6%. Worthwhile to mention that despite increased OE sales, we maintained a high aftermarket share with roughly 27%. Speaking of our adjusted EBIT margin of 7.7%, the main drivers are the structural work we did in 2020, and as I explained before, an improved gross profit margin. I am also happy to report that we are done with restructuring now. In Q1 2021, our restructuring costs were only EUR 200,000. What is only left then is our PPA. Inka will speak about this later on. Let's take a look how the regions performed on the next page, please. Sales in EMEA came in with EUR 168 million, which is a 7% increase compared to last year's quarter. Adjusted by FX, the increase was 9.4%. As a reminder, our OE business in Europe is 90%+ in the trailer business and less than 10% in the truck business. The trailer builders are not much affected by the semiconductor shortage and are sold out already into summer or winter, depending on the trailer application. We, as SAF-HOLLAND, are booked out in our two German and one Turkish plants already until autumn. Beginning of April, we moved the biggest axle plant here in Germany from a two-shift operation to a three-shift operation already, and beginning of May, the other two plants, the other one in Germany and the other one in Turkey, also from a two to a three-shift operation to fulfill the demand of our customers. In the meantime, we do have a good mix of small, medium, and big customers and also further increased our axle market shares. I'm confident to further increase our sales in the remainder of the year. EMEA's adjusted EBIT reached a solid 9.6% in Q1 2021. We are confident to be able to counterbalance also the material price increases in Q2. On the next page, we speak about Americas. Here, our sales came in with EUR 90 million, which is a decline of 14.2% or adjusted by FX, still a decline of 5%. The main reasons are the cleanup of loss-making products and product lines, and unfortunately, the two winter storms we had in Texas in February where we lost nearly two weeks of production. Truck business, which includes the fifth wheels and truck suspensions, is running very well. In the trailer business, we are now adjusting our strategy to a much better customer mix, means we are focusing on medium and small trailer builders rather just focusing on the big five. Results to come will be risk mitigation, product packages to all customers, and higher margins. The work we did last year is paying off and thus, as you can see, the adjusted EBIT margin increased from 3.9% last year to now 6% in Q1 2021. APAC on the next page, please. Here, the good news up front, we don't burn any money anymore in APAC. Sales increased from EUR 21 million- EUR 27 million in Q1, which is an increase by 28% or adjusted by FX, a 32% increase. Our adjusted EBIT margin came in with a positive 1.4% versus a negative 2.4% the year before. Main drivers were the volume increases in India, good performance in Australia, and our China business is now trending in the right direction. Also here, worth my information, no more restructuring to be done in APAC. Here, I would like to pause for a bit and hand over to Inka. Thank you, Alex. Good morning from my side. It's Inka Koljonen speaking. I would like to continue with the investments. As you know, our CapEx guidance for the full year was about 2.5% of sales. Year to date, we are at 1.9%, which is normal, since the CapEx expenditures do not occur on a linear basis. The full year guidance is valid and will be achieved. If we look at the absolute numbers, due to the sales increase versus the previous year, we will be spending an additional EUR 2 million-EUR 4 million in absolute terms versus last year. The focus of this additional CapEx spending is efficiency improvements and further automatization of the production processes at the German, and especially also in the U.S. locations. Let's have a look at the net working capital. Here, the gray bars are the 2020 numbers and the orange bars are the 2021 numbers. You see, net working capital ratio in Q1 is at 14.4%, which is higher than previous year rate of 13%. Main driver here is the basis for the ratio, which is the sales of the last 12 months, which were now lower than the year before due to the pandemic. Nevertheless, it's clear in a boom phase and in the revenue growth phase, we are building up net working capital versus the end of 2021, 2020 sorry. Main reasons here are the tightness in the supply chain, the raw material availability, and also the higher costs of inventories. At the end, it's our conscious management decision really to secure delivery performance and invest into inventories. At the end, it's really a growth-driven increase of the net working capital. If we look further into the year, then definitely this ratio will be increased going forward, coming back to a more normal level towards year-end. On the next page, the cash conversion rate. This is clearly the math. We see that the cash conversion rate is affected by the net working capital increase and is going down to a level of about 30%. Here also, in the course of the year, there will be a significant improvement, which is already expected for Q2. Our leveraging ratio on the next page, please. Balance sheet structure has further improved, which is a very positive development. Here we see the development of the net debt to EBITDA ratio in the past quarters. You see that we are clearly coming down from the peak in the pandemic of where the ratio was at more than 4 times to a level of 2.25, which is clearly within our range of two to three and represents a really healthy balance sheet structure. Our focus going forward will be to keep and further enhance this ratio, but it's clear also that this financial profile provides us with flexibility for future growth, which is mainly targeted in the organic area. With that, I will hand back to Alex to provide a view of the outlook. Thanks, Inka. Ladies and gentlemen, how we see the markets developing in 2021, you can see on page 13, please. Starting on the left side with Europe, you can see new now truck + 22%. Of course, we have to see how the shortage of the semiconductors will be developing in the remainder of the year. Trailer with a strong + 20%. North America, truck + 42, trailer also + 42. South America with a strong 30%+ in truck, trailer + 16. China, a little bit of a mixed picture. Truck with still a little bit of a decline from -5% to -10%. Trailer nearly on the same level with zero to +5. Last but not least, booming India at the moment with truck + 114% and trailer with 182%. To summarize that, as you can see, a significant rebound in North America and India. Also higher volumes in Europe and South America, and China with declining truck volumes. We have to see how that develops in the rest of the year. On the next page, we come to our guidance for 2021. As you have seen on the pages before, we already delivered a solid Q1 in 2021. Given the circumstances like the COVID developments in India, the slow vaccination speed in Europe, the raw material and supply chain challenges, we would like to remain cautious with an unchanged guidance and sales to be in the range of EUR 1,050 million-EUR 1,150 million. Adjusted EBIT margin to be around 7% of sales. As Inka already mentioned, CapEx to be at around 2.5% of sales this year. On the next page, I would like to summarize as follows. We are benefiting from the upswing in Europe, Brazil, and India based on our leading market positions. As I mentioned before, the U.S. trailer business to follow shortly to a new strategy. Our structural cost-cutting measures bearing fruit and are sustainable. We focus on a disciplined approach to manage accelerating customer demand and working capital investments. A further deleveraging is expected and can be expected. Material price increases are already included in our full year guidance. Dear ladies and gentlemen, we did our homework in 2019 and 2020. EMEA performs very well. Americas is back on track with an upside potential, and APAC is going into the right direction with more to come. Thanks for your trust in us, and I think we are open for questions now. Thank you. Ladies and gentlemen, if you would like to ask a question, please press nine star on your telephone keypad. If you would like to withdraw your question, press nine star again. The first question comes from Philippe Lorrain of Berenberg. Yes. Good morning, everybody. Two questions from my side, one on the market and the outlook perhaps, and also the second one on the product portfolio in the Americas. I start with the one on the market. When you raise substantially your outlook for the truck and trailer markets, yet you keep the same guidance unchanged. You've mentioned as well that you want to be cautious, especially with regard to the supply situation and the chip shortage and so on and so forth. I also appreciate that FX can have an impact there, and you mentioned that you're fully booked for until the autumn in EMEA, which is just backing your guidance so far. What would be holding you back from raising the guidance on sales at that stage? Is it just the FX development and what you see on the market in terms of supply situation? Perhaps there's something else that I don't really understand, especially since you mentioned as well material price increases are being included in full year guidance. Okay. Good morning, Philippe. This is Alexander Geis. I would like to take that question, of course. Well, we learned our lessons in 2020, let me say, due to the COVID circumstances, that you could not really plan what's going to happen in the next upcoming months or quarters. We see at the moment there is no shortage in our trailer business, starting with EMEA, in the trailer business. There is not much effect on the shortage of the semiconductors. What we might be seeing is, and what is a little tight at the moment, is the supply chain across the world. There is a shortage of sea containers coming from Asia to Europe but also to the Americas. This is what we are watching carefully. Also, the availability of plastics and rubber is getting tighter. Also, the material prices are increasing. We talk a lot with our trailer companies, especially here in Europe. We are watching that very carefully, and this is why we would like to remain cautious because we don't know what's. Maybe there's something popping up in June, July, or August. We don't see that on the radar at the moment, we would like to remain cautious. Oh, okay. We increased the production capabilities in our plants, and we are looking forward to a very strong Q2. This is what I can already say. Okay. I think just to clarify, the market outlook that you show on that slide, that's not what you use for the sales guidance. That also was not what you were using when you were presenting the full year numbers. Well, it's a combination. Of course, we use the guidance, the market developments for the remainder of the year, but we incorporated, let's say, a safety level for us because we don't know what is going on in the third quarter and fourth quarter. We don't see anything on the radar popping up, but we would like to remain cautious. Okay. The safety net basically means increased just because you start in the year with a relatively strong H1, but you just want to make sure that you reach all the targets. Yes. Okay. Perfect. The second question was just on the Americas and the product portfolio there. You mentioned that you had some effects that were resulting in this unique sales decline, and it was related to the cleanup of the product portfolio, as well as all the rest, like with the winter-related storms and so on and so forth. When should we expect the cleanup of the product portfolio to be finished completely? Well, what I already, at this stage, can say that we cleaned up about 50% of our product portfolio in the U.S. Americas is mainly driven, our production facilities are mainly in the U.S. Canada, Mexico, and Brazil, we can put a checkmark behind that. They are running quite well for us. We have a couple of plants in the U.S., and as I said, we already cleaned up about 50% of all the part numbers, which then enables us to really focus on the main parts and the main product groups. This is what we did already. We are nearly done. Just to give you some examples, specifically in the trailer business, what we did, we stopped loss-making products for trailer applications like cube vans. We saw cube vans at a loss. That's high sales, but it doesn't make any sense, because we are losing money. We are refocusing also, as I explained earlier, now on the medium and smaller trailer customers in the U.S. and also Canada. This is what we changed a couple of years in EMEA, not so much focusing anymore on the big ones, rather than now focusing on the small ones. It's a wider range of customers, and this comes also with better sales and better profitability. This is what we are finished already in Q1 now. Okay. Fair enough. Do I understand it correctly, that you have as well some kind of product portfolio adjustments outside the U.S., or was it just me understanding that? The main product portfolio adjustments were done in the U.S. Europe, we did that already a couple of years ago, but this is an ongoing process all over the world. The main drivers we see in the U.S., where we had an inflation of different products, which added a lot of complexity. We cut that back now, and we are on a good way to further or finish this, and this is also the reason why we increased the profitability in the U.S. Less complexity, more focus on the main product groups. This is also what we would like to continue in the remainder of the year and the years to come. Okay. Thank you very much. Pleasure. We have a couple of more questions. Next questioner is Mr. Jan-Eric Schmitz of Lloyd AG. The floor is yours. Hi. Yeah, thanks for taking my question. I just have three quick questions. The first one would be on EMEA, the margin development. We've seen in Q3 and Q4 really good margins. Given a lower sales number, I was wondering what happened in Q1 that even though we had a higher sales number, margins are a little lower? Specifically in the last quarter of last year, we had a little bit of a mixed percentage OE versus aftermarket. Aftermarket traditionally comes in with a higher profitability or much higher profitability. This is the reason why we had a little bit higher adjusted EBIT margins in Q4. In Q1, we already saw an increase in OE business, which is a good thing for us. The lower the aftermarket percent, of course, that has a mix on an impact on the overall margin. We came in with a 9.6%, which is still a very good number for us. All right. It's just a pure product mix effect on the margin. It's a product mix effect, yes. All right. Okay. On the net working capital side, I think you mentioned that due to the tightness in the supply chain, you want to increase it. What is the target you're aiming for in absolute terms? I mean, percentage-wise, it's obviously going to decrease or normalize a little bit just with the increase in sales numbers, given you're calculating it in the last 12 months. Just wondering, what's the absolute level of net working capital when you say you want to increase it a little bit to make sure you have all the supplies you need? Yeah, sure. Maybe I can take that. I would say the main increase was really done in the first quarter when we saw that raw material prices are increasing and when the situation started to really gain dynamic regarding the tightness. I don't expect any further, I would say, conscious increase outside of our normal system. At the end, we are not guiding towards an absolute net working capital level. Clearly, towards year-end and the further course of the year, the ratio will substantially improve. Already in the Q2, we will have a significant improvement. All right. The factoring is still worth roughly EUR 30 million-EUR 40 million, right? Yes, it is more or less at the same level. No effect out of the factoring to the net working capital. All right. Okay. Lastly, on the leverage. If we assume just increase in EBITDA, given the better results throughout the year, I'm just wondering what you're going to do with the cash. You were talking about purely organic growth. What's the cash usage, basically? Is that going to be in some sort of buyback dividends, or is that just going to be accumulated, or what's the target there? Yeah. I would say we are looking and evaluating all options. Of course, the primary focus and target is to keep and enhance the balance sheet structure. We clearly don't want to come back to the levels where we were, and the two to three times is really a maximum leverage ratio that I think is a good one. At the same time, yes, on a regular basis, we are looking at potential targets. But if we were to go for something, we think that this should really make a difference for us. Also with the multiples being at the moment where they are, it's not that we are running after these expensive targets. If everything adds up, timing, the situation, the target, I think it could have a flexibility, but really the focus is on organic growth. All right. Okay. Thank you so much. We have one more question. It comes from Mr. Harald Fiedler of ODDO BHF Research. Yes. Good morning. Thank you for taking my question. Basically, I was wondering what your vision is for APAC region. Basically, I am wondering what you see as a midterm EBIT margin potential and how steep the trajectory could be given that I assume it is mainly OE-driven business for the time being. Do you see the potential to be in three years on a group margin level? Thank you. Harald, this is a very good question. Of course, what we are not going to do is to guide different regions. Being with the company for quite a while and see what EMEA was capable of developing to, and also now seeing that Americas is trending in the right directions, and we already had better margins in the past there. The target is clear for us that a region shouldn't be margin dilutive to the group result. Okay? We have a good setup. We restructured the whole region a lot. We closed a lot of companies, loss-making subsidiaries. We have now the spread in Australia. We have a base in Singapore and India. We are the market leader in trailer axles and suspensions. We have now our new setup in China. This is only one setup now, and the clear target is to be further increase in sales. We have good products and a good team. We are ready now, and also this should be coming with a certain profitability. Without guiding anything, it is clear that region shouldn't be margin dilutive to the group. Okay. Thank you. There are no further questions in the queue. Therefore, I will repeat. Ladies and gentlemen, if you still have a question to state, please press star nine on your telephone keypad. Yes. We have one more question coming from listener Johannes Ries of Apus Capital. Go ahead. Yes. Hello. This is Johannes Ries. Maybe two short follow-on questions. Maybe again on U.S. market. If I see your market forecast for U.S. market, which is quite strong compared to your own figures and some measures you mentioned, the reason why you maybe have been better in Q1. Is it right to make it clear again that there could be a stronger uptick in the further development of the year, especially in the second half for U.S. business? Johannes, I will take this question. Alexander here. You are totally right. We predicted a strong increase in truck and trailer after a massive dip the year before. We are doing very well in the truck business. The two main product groups in truck is the fifth wheels, where we are market leader, and also truck suspensions. We are fully booked. We have one dedicated plant in Texas for the fifth wheels. In Dumas, Arkansas, there is one dedicated truck suspension plant. We are also fully booked. We see a strong increase in the second quarter. Hopefully, we can solve the material and supply chain because this is really a struggle specifically in the U.S. now. On the trailer segment, pace also the market-wise, it's an increase where we saw a huge drop in the last year. The drop in trailer was more than in the truck business last year. Here we were focusing a lot on air disc brake axles. This paused a little bit in 2020. What we did in the past was only, as I said before, focusing on the big five trailer builders. You are really reliable on those customers, we changed now our focus on the medium and the smaller ones, which is about 100 to 150 different trailer builders. We have a new team in place, a new head of sales. We also would like to participate in that. We for sure will in the truck business in Q2, we see already the numbers kicking in. In the trailer business, we have a little bit more to do, I also confident that the team will manage that in the remainder of the year. For maybe a stronger second half, there are good chances if maybe the shortage of component maybe is not a hit. That's maybe the risk. Second question regarding Asia. How is your optimism that you can go on with a strong upside? Also, is the situation in China and especially in India, where you have a strong market, but what I hear from other sectors, for example, today from the technology sector, that they see a clear hit from the COVID situation there. Is it only a short-term impact? Do you see anything at the moment? Therefore, is there a risk that maybe, at least in Q2, this could continue in some regard, especially in India? Yeah. Okay. We don't see any tendency that APAC will not be developing in the right direction, also in Q2 and going forward. Okay. As I said before, we did our homework, and now the teams are working on profitable sales. I'm confident that we can achieve that and further increase our, let's say, sales numbers and also the margin numbers. In India, we already had a good April. This is what I can say, very outstanding. In May, for sure, there will be a hit, not because we cannot produce. Our team, knock on wood, is healthy. We don't have so many COVID cases, so we can produce. We can see that our customers, specifically in the trailer, but also in the truck business, and in India, mainly a trailer gets sold with a truck combined as one unit, that they have to take out shifts, close productions. We see that the sales is slowing down in May. We will see how that will be developing into June. What we heard is that a lot of areas in India will be closing now down for two weeks, okay, in total. This will hopefully get a release. We are watching that, but we are confident that we can overcome that. We are not only selling our Indian products made in India into India, we also have a good export business. Okay. This is what we keep running there. Okay. Super. Thanks for your answers. Thank you. We have one more question. This is a follow-up question from Mr. Philippe Lorrain. Please go ahead. Yeah. Thanks for taking the follow-up question. It's just regarding the U.S. market, bouncing back on Johannes' question. Do you observe as well that cycles there seem to be shorter now? If that's the case, how are you coping with that in terms of preparation for a strong upswing and also, possibly strong and quite fast declines as well? First of all, we don't see that the cycles are becoming shorter. At the moment, we are in constant talks with our people there and our customers also. Well, the cycles are in the U.S. always, let's say, very tough. Not as in Europe. The cycles are really huge in the U.S. What we see now is order increase, specifically in the truck business, is outstanding. We are still capable of dealing with the material and the supply chain, but it's getting tough and specifically getting good workers. If you have to install a couple more shifts and, well, the shortage of workers, blue-collar workers, this is ongoing, and this is tough, I guess, for the whole industry and not only for our industry. We copy that. We are dealing with that. How this will be developing in the future, I cannot say. We don't see that the cycle is becoming shorter. Okay. That's interesting. Thanks. Thank you. Gentlemen, if you still have a question to pose, please press star. There are no further questions in the queue. I hand you over back to the company. Ladies and gentlemen, thank you very much for your participation and your questions. If you have any further questions, please do not hesitate to contact investor relations. Have a good day and take care. Thank you, everybody.