Ladies and gentlemen, welcome to the SYNLAB Half Year 2023 Report. At our customer's request, this conference will be recorded. Today's call will be hosted by Mathieu Floreani, CEO of SYNLAB, and Sami Badarani, CFO of SYNLAB. After the presentation, there will be an opportunity to ask questions. I will now hand you over to Anna Niedel, who will lead you through this conference. Please go ahead. Thank you very much. Good afternoon and good morning to the US. My name is Anna Niedel, and I'm responsible for investor relations at SYNLAB. I would like to welcome everyone to today's conference call, during which we will discuss SYNLAB's financial results in the second quarter and the H1 year of 2023. Today's presentation, as always, is available for download on our website, so please have a look there, and this call will be recorded and will be accessible later on our website as well at the same spot. With me today here on this call are Mathieu Floreani, our CEO, and Sami Badarani, our CFO. Let's move on to the next slide. The forward-looking statements, as always, I would now like to draw your attention to this slide and would like to remind you, as usual, that during this call, we will present and discuss certain forward-looking statements. Having said this, I would now already like to hand over to Mathieu. The stage is yours. Thank you, Anna. Good morning, good afternoon, ladies and gentlemen, and welcome to our call from my side as well. As usual, I will begin with the highlights of the second quarter, 2023. Sammy will then provide a deeper dive into the financials before I conclude with the key aspects of our business review and an outlook. After our presentation, we'll be opening the floor for your questions as usual. Now on to slide 4, quick preamble. This quarter confirms that we are progressing as expected on our journey of increased underlying organic growth, recovery of the adjusted EBITDA margin, and portfolio management. Now let's start with our highlights of the second quarter and H1 year of 2023 on slide 5. This is the performance overview. We continued our strong performance in 2023, and this is despite a still challenging macroeconomic environment. Even though revenues from COVID-19 testing continued to decline as expected, the total revenues in the H1 year of 2023 already reached half of the guided amount of EUR 2.7 billion in 2023. A key driver again, was our very strong underlying organic growth of 4.4%, which is still above our yearly goal of more than 3% and the previously stated goal for 2023 of 4%. In Q2 2023, the adjusted EBITDA margin of 17% remained stable as compared to the prior quarter and is still in the midpoint of the 2023 guidance of 16%-18%. This shows our underlying growth strategy is paying off. In July, we sold our business in Switzerland, in line with our active portfolio management strategy, on which I will shed more light on the following slide. Excluding the business in Switzerland, both the underlying organic growth as well as the adjusted EBITDA margin would have been even higher. Finally, as expected, the adjusted net debt increased compared to the prior quarter, and our leverage at the end of June stood at 3.4 times. Following the sale of our Swiss business, the adjusted net debt was reduced, and the leverage came back down to 3.13 times. On to Slide 6, portfolio management. As mentioned previously, we are following a strategy of active portfolio management and as part of our initiatives to increase our strategic perspectives, our business performance, and our value for SYNLAB stakeholders. We are constantly monitoring our performance, amongst others, at the level of countries, of activities, contracts, or customer groups, with a reinforced focus on countries or segments with an adjusted EBITDA margin of less than 10%. An example, besides the constantly ongoing M&A activities, are the sale of our U.K. veterinary business back in 2022, as well as the recent sale of the business operation in Switzerland, translating into the reduction of the group's adjusted net debt besides the strategic perspectives. In parallel, we continue our initiatives such as SALIX, focusing on FTE efficiencies, digitalization, automation, or lab footprint. Now onto slide 7. Some of the highlights of the implementation of our strategy. In the second quarter, we successfully continued executing the 4 operational quadrants of our For You transformation strategy. We continued to grow our base business by 4.4%, with positive price effects in Germany and the North and East segment. I would say I'm especially proud of the solid contribution of our For You growth initiatives, which significantly exceeded our expectations. We also continued our retail initiatives, rolled out a centralized CRM system, and conducted sales effectiveness trainings for salesforce. A core component in operational excellence is our efficiency program, SALIX, which already resulted in savings of EUR 21 million in the H1 of this year. As a reminder, in the previous years, we aimed at yearly savings of EUR 20 million, a goal that we plan to double this year. In line with our active portfolio management strategy and also to raise further synergies, we merged the Mexico City labs into one central hub laboratory. As we continue to position ourselves for the future, we further reduced COVID-19 testing capacities and workforce, while continuously developing our activities in the Southeast London region under the Synnovis brand. In the H1 year of 2023, we completed 6 acquisitions in 3 countries. As mentioned before, we also sold our business in Switzerland in July. We aim to make SYNLAB a better place to work and completed our annual employee survey across all countries, with actions having been initiated thereafter. From a scientific point of view, we already had 195 publications in the H1 year, which showcases our industry-leading talent and medical leadership. For ESG topics, we can move to the next slide. This is slide 8. Some ESG highlights. Our SYNLAB ESG strategy is based on 3 pillars: SYNLAB Green, SYNLAB Care, and SYNLAB Citizenship. This quarter, we would like to highlight some of our activities in the SYNLAB Green and SYNLAB Care categories. You already have heard us talking about our ESG-related efforts within Synnovis, the Southeast London contract, and our investments into building the new centralized hub lab according to the highest ESG standards. In parallel, we recently opened a new central lab here in Munich, Germany, and started to build a new medical center in Florence, in Italy. Again, with a special focus on highest ESG standards. In the cybersecurity area, SYNLAB obtained the ISO 27001 certification for SYNLAB Group Data Center Services in June 2023. This ISO standard is the de facto international standard for information security for risk management, cyber resilience, and operational excellence. Its conformity demonstrates that SYNLAB is handling these services and related information security risks in an effective and mature way. SecurityScorecard, cybersecurity posture monitoring and rating has been extended to 34 countries. Remediation activities are focusing primarily on high-risk issues. To engage with our financial stakeholders, SYNLAB conducted an online survey among current and potential investors to understand their ESG strategy and the use of ESG ratings in their investment approach. The feedback is being used to refine our approach towards ESG ratings and ESG disclosure going forward. At SYNLAB, we take ESG efforts very seriously, which we hope to have demonstrated with these examples. Now, let me hand over to Sammy to touch on the financials of today's presentation. Thank you, Mathieu. Good afternoon, everyone, here from Munich. I'm very pleased to walk you through Q2 and H1 2023 financial performance of the SYNLAB Group. Let's start with the revenue on page 10. The Q2 2023 reported revenue stands at EUR 670 million. EUR 677 million revenue on a pro forma basis, meaning adding the additional revenue as if the 6 acquisition completed in 2023 had been consolidated on the January 1, 2023. Negative 15% revenue variance year-over-year. EUR 161 million of revenue reduction from COVID-19 testing. Q2 2023 COVID-19 testing revenue is at EUR 7 million, with a strong reduction versus the EUR 26 million recorded in Q1. Excluding COVID-19 testing, the group has delivered EUR 28 million of underlying organic growth, 4.4% of underlying organic growth. Excluding Switzerland, the underlying organic growth in Q2 is at 4.9%. Very strong growth despite the second step of the planned price decrease in France, which started in April 2023, and a negative working day effect, which were partially offset by a strong price increase in the North and East segment. We have nominal negative effects impact in Q2 with the weakening of the pound, the U.K. pound, the Colombian peso, and few other emerging currencies. Overall, EUR 13 million revenue from the 6 acquisitions completed so far in H1 2023. Moving on page 11, for the H1 revenue performance. H1 reported revenue stands at EUR 1.373 billion, rounded 26% revenue variance year-over-year, negative. EUR 592 million coming from COVID-19 testing. EUR 88 million of underlying organic growth, 7.1% of organic growth in H1. Limited FX impact, EUR 27 million from acquisition contributing 1.5% growth for the H1. Excluding Switzerland, H1 underlying organic growth is at 7.7%. Moving on page 12, for the profitability, the H1 2023 reported adjusted EBITDA stands at EUR 232 million, EUR 303 million organic EBITDA drop compared to last year. Around EUR 5 million price drop from COVID-19, EUR 15 million positive price from underlying business. We have experienced EUR 37 million inflation, negative impact from inflation, 3.4% overall inflation on the base business, with a stronger PEX inflation at 3.8%, roughly EUR 21 million. We have a strong inflation on OPEX, 4.7%, mostly energy, this is reducing gradually. We have a limited inflation on MATEX at 1.7%, mostly consumable and external labor, as our reagent costs are, for the most part, fixed with multi-year contracts. An overall deceleration of inflation as it was EUR 20 million per quarter in the last three quarter and only EUR 17 million in Q2. As mentioned earlier, mostly on the energy cost being reduced. Rest of business is at around EUR 300 million reduction. It includes a negative side impact of the volume drop on COVID-19, which more than offset the positive organic volume growth and the positive impact from SALIX at EUR 21 million. The H1 EBITDA margin of the group stands at 16.9%. Q2 EBITDA margin is at 17%, 10 basis points better than in Q1, despite the drop of highly profitable COVID-19 related business. Moving now on the net profit on next page. The bridge from EBITDA to net profit and from reported to adjusted financials. EBITDA first, we have a nominal adjustment of EUR 2.5 million from EBITDA to adjusted EBITDA. It's acquisition-related cost, mostly. The adjusted operating profit is at EUR 114.3 million. It's down EUR 297 million from H1 last year. The rest of the P&L drivers are higher interest expense, 4.4% average interest rates on our financial debt in H1, and stable adjusted effective tax rate at 28%. The H1 adjusted net profit stands at EUR 50 million, and the adjusted EPS at EUR 0.23 per share. Cash flow, page 14. The cash flow performance in H1 is impacted by one-offs. The H1 operating cash flow is EUR 128 million, with EUR 55 million increase in working capital in H1, and rounded EUR 50 million of Q1 income tax payment. EUR 140 million of CapEx and lease at 10.2% of revenue, with rounded EUR 30 million investment in the new lab of Synnovis in London. Roughly half of the CapEx of the group spent in H1. The unlevered free cash flow is negative in H1, EUR -12 million. It was EUR -7 in Q1, and now EUR -5 in Q2. H1 cash performance is, is poor. It is, however, impacted by one-off, as mentioned earlier, estimated at EUR 85 million and described on the right of the page. I mentioned already Synnovis CapEx and the tax timing, with EUR 30 million in Germany alone. We also experienced delay of billing in France following the implementation of France LIS system. The system works well. It's all about training, process change, adaptation. France DSO is at 44 days. It was 25 days in 2019. Nothing has changed in France, we should come back to this level in the coming quarter. The last item is the normalization of COVID-19 working capital that is still impacting the cash. What I'm trying to explain here is adjusted for the one-off, we still have a strong cash generation model and it is intact. Page 15, strong balance sheet. The balance sheet of the group expressed with the capital employed and capital resources view. The overall capital employed is slightly increasing, with the impact of the six acquisitions completed in H1 and the working capital one-off mentioned earlier on the cash page. The EUR 138 million asset held for sale reflect the accounting of the Switzerland business disposal yearly July 2023. The net debt of the group is now at EUR 1.73 billion, up EUR 155 million versus December 2022. We will see the bridge on next slide. The group has a strong balance sheet, EUR 276 million cash on hand and EUR 500 million of undrawn RCF. The group has also reimbursed in July, the EUR 220 million Term Loan B, with the proceeds of the Switzerland business disposal. The RCF was drawn by EUR 40 million yearly July and fully reimbursed yearly August. Next page, net debt bridge. The adjusted net debt is at EUR 1.7 billion at the end of June. The bridge includes a EUR 20 million interest paid, the EUR 61 million cash outflow in M&A in H1, the dividend paid to SYNLAB AG shareholders for EUR 74 million. The last twelve months, covenant EBITDA stands now at EUR 501 million. The leverage ratio, debt to EBITDA, stands at 3.4x at the end of June. Adjusted for the disposal of Switzerland, it is at 3.13x, in line with our guidance to maintain the leverage around 3 times. This concludes the financial section of the presentation, and I will now hand it back to Mathieu for the business review. Thank you. Thank you, Sami. Indeed, let's cover our main geographies, and we start with the overview of the business in France on slide 18. In France, we reach revenues of EUR 129 million and AOP of EUR 14.4 million, and this AOP margin came in at 11.1%. The Q2 decline in revenue and AOP margin as compared to the first quarter, was mainly driven by the incremental price drop and negative working day effect, which were partially offset by a lower inflation impact on OpEx and positive productivity. We expected price, the expected price decrease also mainly impacted the underlying growth in France, paralleled by a negative working day effect, as I mentioned, in the second quarter. Now the negotiations regarding a new three-year plan are finalized, resulting in a healthcare budget growth of 0.4% per year in 2024-2026. The plan is designed as the previous three-year, three-year plans, and it balances the market-driven volume growth in France with price adjustments in line with our long-term growth expectations for the France segment. Now, Germany on slide 19. Our revenue in Germany for Q2 was short of EUR 130 million. AOP and AOP margin came in at minus EUR 3.2 million and minus 2.5%, respectively. That's mainly due to lower COVID-19 contribution, inflation, and COVID-19 related one-offs. As mentioned previously, a portfolio review to improve performance throughout our business is ongoing. We saw underlying growth of a strong 6.2%, impacted by new customer wins and positive price. Again, recovering also from a weak second quarter in the previous year and well above the long-term growth of this segment. Now on to South, page 20. In our South segment, the revenue for Q2 was at EUR 218 million. AOP was EUR 18.3 million, which is a margin of 8.4%. Excluding Switzerland, the AOP margin would have improved by 1.5 percentage points as compared to the previous year. The profitability was impacted by lower COVID-19 contribution, partially offset by SALIX savings, a favorable base volume effect, and positive price overcompensating the inflation. The underlying growth was at 1.4%, excluding Switzerland, at 2.6%. We saw strong volume development across all countries on a normalized basis and strong price increases across the countries, except for Portugal. The Chilean business also kept contributing to the growth. Now on to page 21, North and East. This will close our segment review with North and East segment reported revenues of EUR 195 million. AOP came at EUR 24.3 million, with a margin of 12.5%. In this segment, we again saw a particularly strong base business growth of 11.5%, which is way above the long-term growth in this segment. The growth was driven by significant increases in testing volumes, more than 5.2%, and prices, increase of 6.4%. Now let me conclude today's presentation with the confirmation of our outlook for 2023 on page 23. The outlook. In the second quarter, we continue to be well on track, in line with our published expectations for the fiscal year 2023. Based on our strong core business of routine and specialty testing, we are very well positioned for the future. We continue to expect group revenues of around EUR 2.7 billion. This assumption is driven by continued underlying organic growth, which we now expect to exceed 4% throughout the year. On the other hand, this maintained revenue expectation includes the deduction of the projected revenues from our Swiss business in the H2 year and the reduced expectations regarding COVID-19 revenues. Our 2023 adjusted EBITDA margin is still expected to be in a range of 16%-18%. This incorporates all factors mentioned previously, adding COVID-19 capacity ramp down costs being offset by a positive effect of the sale of the operations in Switzerland and the strong development of the underlying organic growth. There were no changes regarding our M&A planning. We aim at spending up to EUR 100 million in 2023. This is a temporary reduction compared to previous years, while we fully focus on bringing productivity back to the pre-pandemic levels. In conclusion, the company is performing as we expected, combining the strong resilience of our core business of routine and specialty testing with the continued progression on our key metrics. We are strategically very well positioned for the future. With this, I would like to hand back to the operator to open the line for the Q&A. Thank you. Ladies and gentlemen, if you do wish to ask an audio question, please press star one one on your telephone keypad. Once again, that is star one one to register for a question. If you wish to withdraw your question, you may do so by pressing star one one again to cancel. There will be a brief pause now while any questions are being registered. Our first question comes from the line of Kirill Talai from Natixis. Please go ahead. Your line is open. Hi, hello. Do you hear me? Yes, we do. Yeah, great. Thank you very much for the presentation. Yes, congrats on the good quarter. It's always nice to see the, strong growth of the underlying business. I have a few questions, please, if I may. The first one is, would you share with us the, valuation of the, Switzerland business that you sold, in July? You know, in terms of multiple. The next question would be, considering this, you know, kinda the, disposal of the, not very profitable, Swiss business, should we expect more exits from, other European countries, you know, that have low margin? Especially, you know, since you shared with us this, this chart on the, on the page 6, you know, that there are probably kind of half of the countries with the margin comparable to the one that you had in Switzerland. What's the strategy here of the near to mid midterm? Then also, regarding North and East segment. This 6.4% price increase is very impressive. Would you maybe please share, you know, what countries really experiencing that kinda increase in price? What are the, the countries, you know, driving this overall good price impact here for the segment? All right. I will go back to the first to the first question. As we announced, the total value was CHF 150 million, EUR 154 million. This is 1.5x revenue. We didn't share the EBITDA multiples, but I think you have correctly viewed that the situation was not very profitable, hardly profitable. I would say it was a very healthy, accretive multiple for us, but I will not say more details here. The question on the low-margin businesses. Make no mistake, our, our activity and purpose is to base these decisions on long-term strategic perspectives, not just selling what would be at lower profitability. We have many examples from the past where some businesses were struggling, and we turned them around, some going from, let's say 6%, 7% EBITDA to 22%, 23%, and some even higher that were in the, say, around 10%, 15% moving to more than 30%. Our perspective, strategic view is the first determining factor. We look at our perspective in the country. We always look at 3, 3 criteria to enter countries, but it's, it's symmetric to a degree, to exit, which is, can we further consolidate the market? What is our critical scale, right? This is, this is an important point. How is the growth, organic growth of the country, and how is the regulation? So we apply the same, say, filter to all countries. Indeed, when a country, say, doesn't offer really good long-term perspectives, or the situation change, then we have, say, done that in the past and will continue in the future to redeploy our capital in different geographies and exit the one that would correspond to these criteria. Now, on North and East, I will probably leave Sammy giving some examples of the 6.4% price increase. It's not just one country, right? It's many countries are contributing to, to this, good, result. Sammy, if you want to give some details. Yeah. Probably also to add on the prior questions, just the portfolio management is not only a country discussion, it's, it's within countries, the segments, the activities, the regions, the contracts, the customers. It's not a question whether we sell or, or, or keep a country. It's, it's broader than that. The ongoing exercise that we're doing and, and the strategic exercise that we're doing in Germany is, will, will, is, is right on that. Now, on the pricing, it's true that to be able to deliver 6.4% price, it, it goes not only in one country, it's broader. It's, most of the country have delivered strong growth here, a strong pricing impact. I, I would highlight probably two countries, Hungary, where we had a very strong price increase in hospital, and, in the emerging markets also, where we have strong growth also in different countries. Overall, with the size of the UK, UK is contributing a lot also, where we have a very nice growth of price in the UK, but, it's positive price across the network. Great. Thank you, Raj. Very, very helpful. I will get back to you. Thank you. One moment, please, for our next question. Our next question comes from the line of Jan Koch from Deutsche Bank. Please go ahead. Your line is open. Hi, Mathieu. Hi, Sami. Thanks for taking my questions. I also have three, if I may. The first one is on the reimbursement agreement in, in France. How do you view the, the outcome, and what are the potential implications for, for your future margin profile in this country? Do you believe that you can reach, your pre-pandemic margin profile in France again in the future? My second question is on your group margin guidance for this year. You mentioned that you would have shown an adjusted EBITDA margin of 17.5% in Q2 and in H1. Are you expecting any negative impact in H2 that could put further pressure on your margin? Or, or to put it differently, is it now more likely that you end up in the upper half of your 2023 margin guidance than in the lower half? Finally, I was a bit surprised that the margin profile in Germany remained negative now in Q2. I understand that the COVID-19 capacity was a driver for this, but what should we expect here for the coming quarters? When do you expect the margin in Germany to improve again? Okay, I can start on the first question, and we'll hand over to Sammy for the margin precisions. The view of the French negotiation is, I would say, if I summarize, it's a few points that are important, I think. First, the regulator is reasonable, and this is what we see across all of our geographies. Regulators have a long-term view, and I think this is a good proof also in this case. It's also a proof that we are critical in the healthcare system as an industry, and that we have, to a degree, also some leverage. I would say we, we are happy that it's in line with our long-term expectations. Now, on to the, the, the margin implications, maybe I, I leave it to you, Sammy. On the margin, our guidance remains 16%-18%, and there is obviously a number of factors that influence this margin, one positive, others negative. More specifically, in comparison, the H1 to H2, we usually have a seasonal effect, so in Q3. Q3 is usually a lower margin for the group. It doesn't mean that there will be an underperformance of anything, but it's purely related to the volume. Again, we, we, the margin in H1 was supported by the very strong organic growth in Q1 and Q2, 7.1%. This, The overall organic growth in H2 will be slightly lower than that, probably. So this will be putting more pressure on the margin on one side, but on the other side, it's fair to say that the Swiss business will have a mechanic mix, positive impact. So far, we maintain our guidance 16%-18%. Obviously, with the help of Switzerland, make us even more comfortable on this range, within, to be within the range. Now, on the German case here, it's fair to say that in H1, we have been impacted by a negative one-off related to COVID. We do expect an improvement of the margin in H2, and this is the current roll-up that we have from the country. It's based on, on very strong organic growth that we have already seen in, in H1. We will monitor this. Beyond the quarterly, quarter after quarter, we know that in Germany, we had relatively stable price in the last few years, and with the inflation hitting us in the last 2 years. There is pressure on the margin in the country that is difficult to overcome. It raises questions on some segments of the activity or some regions, but this is part of the strategic portfolio review that we talked about, and I will not elaborate more. We do expect normally an improvement of the margin in H2, but it will probably not solve completely the challenge we face in Germany. Great. Thank you. Could you also comment on the question in France, the long-term margin profile? Do you expect to reach the pre-pandemic profile in France anytime again in the future? The, the Fr-- Well, in our long-term plan, besides the challenges faced on the short term with last year, this year price and the inflation, we were always maintaining the margin in France, relatively stable, no improvement on the margin overall. So this remained the case, so that means that we, we don't expect significant improvement of the margin in France, in any case. Because of the mechanic of the pricing volume play, there is a lot of visibility, and the agreement that was done recently with the, with the state is demonstrating this stability here, because it's the same model that has been in place for, for roughly a decade now, and that has proven relatively successful. We know how to operate in an environment where prices goes down regularly. We have time to adjust, and the volume and the mix helps a lot. That, that should help the, the equation. Great. Thank you. Thank you. Our next question comes from the line of Sezgi Oezener from HSBC. Please go ahead. Your line is now open. Hi, Sezgi Oezener from HSBC here. Thank you for taking my questions. I will have three, please. First of all, can you give us some color about the long-term trajectory of margins? Should we think, like, in the long term, the 23% EBITDA margin should remain on the agenda, and what would be long term in that sense? It was the first question. Second, can you give us an update about the litigation progress concerning Portugal, and the risk of that spreading to other countries? You also mentioned in your slides that in the South region, pricing was actually positive, with the exception of Switzerland and Portugal. Is that related in any way to this anti-competitive investigation that you're experiencing there? Third of all, we've seen, of course, your personal prices coming down compared to your revenues from the highs that we have seen. How much further, how much further improvement can we expect in terms of the ratio of wage costs to, to your revenues? Thank you. All right. On the long term... Thank you for your question, Sofie. On the long-term strategy, on the long-term trajectory of the, the margin, I will leave it to my special lawyers. Yeah. Here, we will not provide any update on long-term guidance today. We have communicated previously assumptions for 2024 and 2025, and we maintain this 23%, our ambition. It's not a, a guidance, it's our ambition and target for the long term. Demonstrating that we, we, we have levers to achieve that, and, and part of the lever would be the portfolio management that is now in place in the as an initiative in the group. That, that's the first point. On the litigation in Portugal, you want me to answer this one, Sami, or do you want to? Yeah. Yeah. Yeah, so, so, I think we, we have answered the, the authorities with our view of non, non-guilt. I think this is a long process of say back and forth, so we have no update to provide at this point. But the, the price in Portugal has nothing to do with this at all. It's, it's one contract on for a hospital. That's not related. Maybe to kick it off on the, if I understood your question well on wage-to-revenue ratio evolution. Of course, wage is an important part of our cost that we're, we're permanently working, be it on, just getting back to, say, a nominal productivity, but also helping it further with digitalization, and other levers, to say, reduce the, the, the burden of wages. It's not an absolute metric, right? Because it, it also has to be in correlation with the gross profit you make in this, in overall. We pilot more by country, as we said earlier, and within the country by, by contract and and region, rather than at overall group level. If that makes sense to you? Sure. Thank you very much. In terms of the progress done on a group, group level so far, let me maybe ask differently. Not as a% of wages to revenues, but in terms of further COVID wind down and in terms of further optimization in the size of personnel. Do you have further to go or is that done, what we're seeing? Yeah, I, I think I will let Sami elaborate further if needed. One important point to as we mentioned earlier, right, is that the COVID winding down was with two different components. One was the COVID dedicated people or COVID-related people, which we are now at the end of this restructuring with the last country being Germany, where COVID lasted the longest. There was another effect, which was that, for the years during COVID, we, our focus was really on, say, serving the markets and not optimizing our productivity, which resulted in, say, a few, in inverted commas, lost years of productivity management, and this is what we are working on, and that's what we mean when we say, recovering our pre-pandemic productivity. On this, we still have some way to go, but we are very well progressing, as you also see on our SALIX cost initiatives, where we are on target. Thanks very much. You're welcome. Thank you, and one moment for our next question, please. Our next question comes from the line of Blanca Pawlowska from Barclays. Please go ahead, your line is open. Good afternoon. Thank you for taking my questions. I have two, please. If I could just start on Cinven and the non-binding offer. What is the update here? Given it has been quiet for a few months now, should we assume that a formal offer is now unlikely? My second question relates to the Swiss and South business, to be more specific. Following the divestment of the Swiss business, how should we be thinking about margins in the South business in the quarters to follow, and also margin expansion potential over the next few years? Do you expect that 6% long-term growth figure that you provided for the South business to differ following the Swiss divestment? Thank you. Okay, thank you for your question. On the first-- I will take the first one and leave the second one to Sammy. What we can say and you understand that we are in a very strict legal environment on your question about Cinven. We, what we can say is that we are in active exchange with Cinven regarding their expression of interest back in March, and expression of interest was for a potential public acquisition offer to all shareholders of the company. Of course, getting more visibility here in Q2 and H1 financials is an important step most probably for the transaction to progress. We, as a management board, will continue to execute our fiduciary duties, and that's with the support of Lazard. We will inform the capital markets about the progress of the developments in accordance with the legal requirements, and I'm sorry not to be able to say more, but I think this is probably quite understandable. I'm sure you understand also, we cannot say more than this in this strict legal framework. Now on to the Swiss question, maybe for Sammy on the South, for the impact on South. The on the South region, we've mentioned a long-term growth of around 6%. Switzerland is one relatively sizable portion of South. There will be. Our plan initially was to recover market share in Switzerland. I wouldn't change drastically the 6%. There will be probably a slight improvement to this number, but not, not in proportionate of the revenue, as we were planning to on the long term, to recover our market share in Switzerland initially. Okay, thank you. For next year and, and the following years, following the Switzerland disposal, I mean, it's an enabler. Obviously, you saw it already in H1, the 50 basis point. This will probably also help next year and the following years, but it, it's part of this overall strategy of portfolio management. I, I would not isolate it. We will, we have not changed anything to our previously, guidance of minimum 50 basis point in 2024 and 2025. Today, there, there is no change to this, to this guidance, and obviously, this will help. Thank you. One moment, please, for our next question. Our next question comes from the line of David Adlington from J.P. Morgan. Please go ahead. Your line is open. Hey, guys. Thanks for taking the questions. Firstly, just coming back on the Cinven interest. Last quarter, you said we were going to get an update in the next several weeks, and three months later, we, we're still not any further on. I just wondered what was holding up those negotiations, and any color there would be, would be helpful. When might we, we expect an update? Secondly, on Germany, just, again, on the margins, I just wondered if you could talk about how homogeneous your margins are across the German market. Is there a small tail that's very unprofitable and that would really help you? Or is it a wider problem than that? Thanks, David. On, on Cinven, indeed, last quarter, we, we expected, as we said, maybe to be able to give an update a bit faster, but these processes are, are, are complex and very unpredictable. I would refrain from giving any further prediction on when we would be able to give more update, and I'm sorry for that. On the German margin, before letting Sami complete, but basically, our German business is composed of two, two main business lines, two main type of customers, general practitioners and specialized doctors and hospitals. We, we are suffering in the hospital activities on several contracts, and some are fairly large contracts. That's fairly obvious also to understand the dynamics with inflation hitting and these contracts being, say, medium-term contracts with prices that are not always easily adjustable. I would say the problem is not a long tail of many contracts. We have a very healthy business in Germany, but that is a bit polluted by some of these these hospital contracts, and this is what we are addressing now. It's not a quick fix, of course, as we can understand. Maybe, Sami, you want to add? No, I think it's, it's clear. What you mentioned is very clear, so I have nothing to add here. maybe I could just come back on that German hospital question. In, in terms of potential fixes, obviously, you've talked about portfolio rationalization, but is there anything you can actually do with those contracts to try and renegotiate them, or anything else that you could address there to try and help with profitability? Yeah. We have an 1/3 of the business in Germany is hospital, and so we have a numerous number of contracts. And those one are, a portion of them are renewed regularly, every year. I mean, every year we have some renewals, so it's not that we're stuck for the long term overall. There are some contracts that has longer duration, but we will... One solution is a strong renegotiation approach on an ongoing basis, that's one scenario that could help us improve continuously our performance, but it could take some time. This is one of the approaches that we're evaluating and I'm trying to understand the impact. I suppose. Distributed, very distributed, very granular level. It's very complicated because it's not all the same type of contract. You have different type of services, you have people on, on site, not on site. You can evolve the service, you can change the type of service. There, there is a lot of things, levers that we can implement to, to, to somehow improve the overall situation. Sure. Perfect. In terms of us trying to model out Germany from here, how would you suggest we think about the margin evolution? Sorry, can you repeat? I didn't catch the question. Yeah. If you're in our position, and we were thinking about having to model the margin evolution in Germany from here, how should we be thinking about that margin evolution in Germany? I think, we mentioned earlier that we will have an improvement of the margin in H2 and a continuous improvement in the subsequent periods. It's, it's, the fix and bringing it, let's say, to the group level or whatever, will take a longer time in our, in our view. It's a gradual improvement. Okay. Perfect. Thank you. Thank you. As a final reminder, for any last questions, it's star one one on your telephone keypad to register. As we have no more questions registered, I now hand back for any closing comments. Okay. Thank you very much, thank you everyone for your participation in today's conference call. As always, if you have any further questions or follow-up questions, just feel free to reach out to me or to us anytime. Having that said, I will now close today's call and hope to meet you again in our nine-month/third quarter 2023 call, which will happen on the eighth of November. The eighth of November. Goodbye, everyone. Thank you. Thank you. Goodbye. This now concludes our presentation. Thank you all for attending. You may now disconnect.