Welcome to the Wacker Chemie AG conference call on our Q3 2023 results. Dr. Christian Hartel, our CEO, and Dr. Tobias Ohler, our CFO, will take you through our prepared slides momentarily. The press release, Q3 presentation, and detailed financial tables are available on our webpage under the caption Investor Relations. Please note that management comments made during this call include forward-looking statements involving risks and uncertainties. We encourage you to review the safe harbor statements in today's press release, the presentation, and our recent annual report regarding risk factors. All documents mentioned are available on our website. Chris? Hi. Welcome, everyone. Group sales reached EUR 1.5 billion, with an EBITDA of EUR 152 million. Both are down sequentially and year-over-year. Declining prices in solar-grade poly and commodity Silicones were the biggest contributors to this decrease. Across the board, the chemical industry reported low demand for its products, while the pressure from imports, inflation, and high energy costs remained high. We do not see a recovery in demand over the last quarter. As a result, our messaging on chemicals today is essentially unchanged since the presentation of our second quarter results at the end of July. In Silicones, we faced weak demand for specialties without an economic recovery. We pushed volumes into standard grades, which we see very low prices today, to keep utilization rates at upstream assets at economic levels. This shift led to adverse mix effects. These factors, alongside continued and trailing high costs for silicon metal stock, held the segment's results back noticeably. Order intake is short-term and stagnating at a low level. Although prices for standards have roughly halved since last year, specialty prices have held up well. In Polymers, positive net pricing supported a strong result as we defended our margins. While orders have stabilized, we remain cautious about the European construction markets. In Biosolutions, we are actively integrating the ADL and Wacker teams at the site in León. With the acquisition, we gained access to much-needed fermentation capacities to serve the growing demand for sustainably produced dietary and food ingredients. As expected, costs for the upcoming mRNA facility and digitalization projects held back earnings. Polysilicon delivered a positive double-digit EBITDA figure despite China's low market price for solar-grade Polysilicon. Demand for our solar Polysilicon outstrips our contractually available volumes this and next year. Yet a substantial part of our volumes remains under legacy terms tied to the China domestic index. Our semi business remained resilient, seeing both solid prices and volumes. We saw strong demand from our semi customers, committing to very long supply agreements. This summer, we announced that we will increase our etching capacities for semi by 50%. When good for order in 2025, this will allow us to improve our mix further and increase the resilience of Polysilicon. Looking at our sustainability initiatives, Wacker was recently nominated as one of the finalists for the German Sustainability Award in the Chemicals category. While conserving energy and resources has always been a top priority at Wacker, we have increased our commitments and aim to achieve net zero by 2045. This nomination recognizes our efforts already made to reach this ambitious target. We see a strong business case for sustainability. Wacker's long-term success depends on providing sustainable and innovative solutions to our customers. Sustainability keeps us focused on efficiency and strengthens our relationships with key customers. I'm happy that our external stakeholders and banking partners increasingly recognize our activities. One brokerage recently named Wacker an ESG leader in their coverage universe. Thank you for recognizing our efforts here. Looking at the next page now, our guidance. We see full-year EBITDA at the lower end of the earnings range, which we communicated in July. We expect EBITDA between EUR 800 million and EUR 900 million, with sales of about EUR 6.5 billion. Markets have been weaker than we expected. Our customers remain cautious. In polymers, we face uncertainty from the construction markets. In Silicones, order intake is not showing improvements. We continue to have limited visibility in both segments, with our customers shifting to just-in-time ordering. This makes it difficult for us regarding both production, planning, and forecasting. Even though we continue to face considerable headwinds, I'm confident we will successfully tackle the challenges ahead. We have an excellent team at Wacker. What's more, we are well-placed strategically. Our Strategy 2030 provides us with goals, faster growth, high profitability, and better resilience in light of constant change. While adapting our modular investment strategy to the changing environment, we remain committed to the path. We continue to grow in the regions close to our customers. We recently announced a new EUR 150 million specialty Silicones investment in China, which will be ready for order in the second half of 2025. Zhangjiagang is one of Wacker's largest, fully integrated production sites. From here, we supply the rapidly growing Chinese markets with a wide array of downstream silicon products, such as sealants, elastomers, emulsions, and fluids. Two weeks ago, we actually celebrated 30 years of Wacker being in China. We continue to drive our business sustainable development forward. Investment in our future growth is vital to realizing the opportunities ahead of us, but major challenges persist. In addition to weak demand, the combination of unfavorable German policy choices and the fallout from geopolitical events, such as the war in Ukraine, keep energy costs up. We believe the conflict in the Middle East will result in higher uncertainty and may delay an economic recovery. Energy-intensive industries in Germany remain burdened by high power costs, and supply needs to be more secure. We see that renewables will answer this problem, but we need short-term measures to support the industry through this transitional period. In Berlin and Brussels, much talk has been about an industry power price and the reshoring of critical raw materials in industries. Unfortunately, until now, it remains only talk while other regions act. Now to Tobias for details on Q3 results. Thank you, Chris. Welcome, everybody. For the third quarter, we reported sales of EUR 1.5 billion, down nearly 30% year-over-year. We continued to see weak end market conditions. Low demand for specialties weighed on utilization rates, particularly in Silicones. While polymers also saw weak demand, we continued to benefit from net pricing. Polysilicon saw much lower prices for solar-grade materials due to overcapacities in China. High energy prices continued to burden us, particularly in Germany. Globally, this year's energy bill will still be twice as high as before the hike last year. All these effects worked their way through the P&L from top to bottom. The gross profit margin was 13%, down from almost 23% last year. EBITDA contracted to EUR 152 million. Earnings per share came in at EUR 0.56. During these challenging market conditions, we have increased our focus on controlling costs and are implementing additional short-term measures on top of our existing programs. This covers personnel costs, technical spending, direct materials, and all discretionary spend. We must consider all options to run as efficiently as possible. As Chris mentioned, we now see our group full year sales and EBITDA in the bottom half of the communicated ranges. I will walk you through our expectations for each segment after I address the balance sheet on the next page. Our balance sheet shows strong financials with about EUR 1.4 billion in liquidity and about EUR 4.7 billion in shareholder equity. Our net working capital position is about EUR 100 million lower than at the end of last year. We have achieved meaningful reductions in inventory as we continued to reduce our stock levels. We actively work with key suppliers to match our needs with current market conditions. As our sales grew rapidly, we invested significantly in working capital over the past two years. As demand slows and prices recede, we expect this to unwind, supporting cash flow. Our financial borrowings have been constant at about EUR 1.5 billion in the last couple of years, with similar levels of liquidity. This had resulted in a net interest charge of EUR 15 million-EUR 20 million annually. This year, we will end with a positive net interest figure of around EUR 5 million. Essentially, this comes from increased deposit rates, while interest rates on borrowing were fixed in time and remained the same. Our financing portfolio is well diversified across lenders with maturities between 2024 and 2030. We are solidly financed with EUR 1.4 billion in liquidity and fully undrawn syndicated loans of EUR 600 million. Moving on to Silicones. Sales decreased to about EUR 670 million, down nearly 25% year-over-year. The decline was mainly due to much lower specialty volumes and due to prices in standards. Sequentially, sales were somewhat lower. We see continued weak demand in all regions and some negative pricing effects in some specialty products. Silicones EBITDA was unchanged compared to the preceding quarter at about EUR 50 million. Low output and high silicon metal costs held back earnings, as with the preceding three quarters. With low demand in specialties, our product mix adversely moved towards a higher share of standards. We have updated our Silicones outlook. From today's perspective, we do not see a demand recovery in the fourth quarter of this year and rather assume year-end management of some customers. With a low volume turnover, headwinds from trailing higher raw material costs continue longer than anticipated.... While we have reduced our silicon metal stock position significantly, work still needs to be done here. We now expect full year sales between EUR 2.7 billion and EUR 2.8 billion, with an EBITDA margin of about 8%, versus our previous margin expectation of around 10%. Polymers reported sales at just below EUR 400 million, down around 20% year-over-year. Sequentially, sales were down about 5% at similar volumes. The much lower revenues were driven by the development of selling prices, which we adjusted to reflect our raw material costs. Despite demand remaining particularly weak in Europe, the EBITDA was much higher year-over-year and at the same level as the preceding quarter. As a reminder, the previous year's quarter was held back by a planned turnaround. The main factors driving the consistently strong result throughout 2023 have been net pricing and our efforts to defend margins. For the full year, we have left our polymers outlook unchanged. We expect sales between EUR 1.6 billion and EUR 1.7 billion, with an EBITDA margin of around 17%. Despite considerably lower volumes, our absolute full year EBITDA will be comparable to last year's record result. Although polymers demand has stabilized recently, we remain cautious about European construction markets. In Biosolutions, sales came in at EUR 77 million. Lower prices and volumes for some established chemical products offset sales growth in Biopharma. As in our chemical segment, we see weak demand and inventory management of our customers for these products. EBITDA in the third quarter was EUR -3 million. Earnings continue to be burdened by upfront costs related to the German Pandemic Preparedness Plan. For the full year, we have updated our Biosolutions sales outlook. Demand has been weaker than expected, and we now forecast a low single-digit% sales growth, down from a high single-digit previously. Our EBITDA forecast is unchanged. We expect a result below last year. Please remember that we carry substantial costs today from our new mRNA center in Halle, and will see revenues in mid-2024. While we currently see a challenging funding environment for many smaller biotechnology companies, we continue to see a strong growth outlook for advanced medicines. Thousands of new molecules are under new development and will need a CDMO partner, such as Wacker, to bring these therapies to market. In Polysilicon, we reported third quarter sales of about EUR 340 million. EBITDA came in at EUR 46 million. Compared to the preceding quarter, both sales and earnings contracted meaningfully. This was primarily due to the steep fall in the market prices for solar-grade Polysilicon in China at the end of the second quarter of this year. Another factor was lower volumes in the third quarter, as maintenance in our US facility resulted in lower output. The solar market is now differentiating products by origin. We expect this trend to continue, and we see more demand for our Polysilicon than we currently contractually have available. We still have significant contractual exposure to the Chinese domestic market price today. We are actively addressing this and work to change nearly all our solar volumes to the ex-China price by the end of next year. We have updated our Polysilicon outlook. We now see sales at about EUR 1.6 billion and an EBITDA between EUR 300 million and EUR 350 million. The lower range is due to the lower volumes as we perform maintenance in the US facility and due to trailing price effects from the end of Q3 market price indices. Looking at our net financial debt, page ten. Through the first nine months of this year, we generated approximately EUR 630 million in cash flow from operations. Our cash conversion improved markedly compared to last year, where inflationary pressures resulted in a significant investment in working capital. We see this now unwinding with raw material prices declining. Cash flow from investing activities came in at EUR 550 million, primarily representing investments and M&A as we expand our capabilities and capacities in line with our Strategy 2030. Including the dividend payment of about EUR 600 million in May, we ended the first nine months with a low net debt of about EUR 160 million. So yes, our investments are high at a time of weak demand. On the one hand, these investments represent decisions taken before the slowdown, but they also include recent decisions. I see this as a clear sign of confidence in our markets. We want to be prepared when market conditions improve and markets pick up. We are completing maintenance today and making the needed investments to support our customers' growing demand for innovative and sustainable solutions. These new capacities will allow us to service our customers better once demand recovers. As Chris said, our development work with customers continues to expand further and improve our specialties portfolio. So let me wrap it up before we start with the Q&A. We continue to see challenging markets. The anticipated recovery is delayed, and our visibility still remains low. This makes both internal planning and external communications demanding. I expect many of you will be looking for comments on how 2024 may develop. We will stick to our usual approach to guidance. We will communicate our 2024 full guidance when we publish our full year 2023 results in March next year. Operator, we are ready now to begin the Q&A. Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question may press star followed by one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star followed by two. In the interest of time, please limit yourself to two questions only. Anyone who has a question may press star followed by one at this time. One moment for the first question, please. The first question comes from the line of Thomas Wrigglesworth from Société Générale. Please go ahead. Yeah. Good afternoon, everyone. Two questions, please. Firstly, on 2024, I perfectly respect that you don't want to give a guidance. So it would be very helpful if you could discuss the building blocks you might be seeing already for next year. My second question is on your legacy Polysilicon contracts in China. You have repeated today that you are looking into those contracts. My question is regarding the progress. Have you made any progress on revising those contracts during the quarter? Thank you. Thomas, to be honest, yeah, yes, you are digging into 2024, but as I said, it's too early for guidance. But what you can read from our outlook for the year end is obviously, we assume a slow start into next year. And, if you translate that, a slow start into the year, that obviously also means a weaker first half is likely. The second item would be the discussion on our input costs on-- mainly on raws. Raws should come in lower, as we had seen a decline throughout the year, obviously. But watch out, and you know that I'm always on the cautious side. The same goes for our own selling prices. I mean, these also have been on a decline throughout the year, so we have rather low exit rates. For sure, as I mentioned also in the speech, we will be very stringent on cost, so cost contingencies will be very important. So we will top up our efforts here. But then the final questions, and we are in the midst of the discussion here still, is how to assume the volume pick up. We haven't seen it, so it's a highly debatable figure. So the question is really, what magnitude can we expect? I mean, we had seen some inventory correction in this year, which should be over, and finally, end markets should pick up somewhat. But there's a huge discussion in the organization about how much. So as I said before, we are not there yet, but these are about the building blocks. Full guidance will be given in March, but possibly, twenty twenty-four mirrors a bit twenty twenty-three, just with a weaker first half and a stronger second half. But I think that's what I would, yeah, be ready to share today. Okay, Thomas, and on your, on your second question on the, you called it legacy contracts or contracts that are tied to the inside China pricing index. So what we reported is that within this year and also end of last year, we achieved, yeah, I think quite a remarkable change in, in the contract structure. But we also said there is still, substantial part of contracts under the Chinese index. So we could keep on, you know, discussing with our, with our customers to convert these contracts to the outside China index, which we believe is, values the value of our material. You can imagine, you know, with a lot, a lot of contracts, I mean, there are different durations, and obviously, it's easier to change terms if you have a—if a contract ends and you start a new contract. Nevertheless, we also continue discussing, heavily discussing and negotiating with customers that have existing and running contracts to change these to these new terms. Yeah, as I said, we achieved a lot this year. Latest by the end of last year—next year, we will probably shift all the volumes to the new pricing model. Thank you. ... The next question comes from Rikin Patel from BNP Paribas. Please go ahead. Hi, all. Thanks for taking my questions. I too, on the guidance. So first in Polysilicon, your new guide implies a sequential step down in Q4. I suppose given you've had maintenance in Q3, I'd expect volumes to be up sequentially. And given you also price at a lag, I'm just curious why you're seeing a step down in Q4. And then in Silicones, now I know you've covered the demand weakness and continued, I guess, negative sentiment in that market, but again, the sequential step down does seem quite significant, even if I adjust for seasonality. I'm curious just what the moving parts are there, and if you could give any sort of indication on what operating rates are, across your plants and Silicones, that would also be helpful. Thank you. Okay, Rikin, this is Chris. Starting with your first question on the Polysilicon guidance for Q4. So actually, also what Tobias mentioned in his speech at the end of Q3, we also saw declining prices for Polysilicon, which is now dragging down into Q4. So the main effect is really lower prices for solar poly in Q4. And yes, we also remain a little bit cautious on the December numbers in China. On the volume side, volumes in Q4, we believe, are similar to the numbers in Q3, and in the Q3 numbers were affected by some maintenance, which is also dragging into Q4. And on Silicones, Rikin, Tobias speaking here. For Q4, we originally had expected some more stable demand. We continued to see low demand, and that specifically affects also the portfolio of our specialty customers. They act short-term, they act cautiously, and for that reason, why we see October coming in similar to September, we are cautious on year-end, and we see some inventory management effects of some customers. So that means running our upstream at a high level, overall, the product mix would be affected negatively. While the strategy is on specialties, we just then balance it with standard products. This goes then in parallel to still higher costs for raw materials. We had expected that with higher turnover, we would get through those high-priced inventories sooner, but with a push out of volumes at our suppliers, we sometimes also have to bear trailing prices when we take the volume at a later point in the year. And finally, maybe another element that will sequentially be a burden on Q4 is standard prices will still be a drag. They have stabilized recently. We noticed that. There has been even a small uptick in China, but as exit rates in Q3 are lower, we also expect the average in Q4 to be lower than the average in Q3. So all put together, this makes us very cautious on Q4 with respect to Silicones. Okay. Thank you both. Makes sense. The next question comes from Charlie Webb, from Morgan Stanley. Please go ahead. Yep. Afternoon, everyone. Thank you for taking the questions. Maybe just one following, following up on Thomas's question on the Polysilicon contracts and, and shifting those away from the China reference price. Could you give us a sense of, you know, versus 2023, you know, what proportion of volumes, you know, have you had successful renegotiation of terms, as we think of 2024, and what may be coming more towards the end of 2024 in terms of when the timing of these contracts to come up? Just trying to understand the phasing of that shift in terms of what that might mean. And then second, just on, on that same point, just what do you think is the sustainable premium for non-Chinese poly? What is that offshore price, that kind of sustainable premium you think, as you're kinda going through this negotiation? So two questions there. And then if I could just sneak one other one in. Just, you know, early on in the call, you mentioned that, you know, Europe hasn't really acted, to, to protect industry, German industry, the solar industry. You know, what is the latest? Obviously, we do continue to hear more talks around a resilience bonus and such forth, but, but just any sense on where you think things are for Europe as they look at the solar value chain would be, would be great. Okay, Charlie. Yeah, let me, let me start with your, with your first question on the, on the poly contract and the shift. I can just give you some, you know, some rough numbers on that. I mean, keep in mind, a year ago, so at the end of 2022, almost all these contracts were based on the inside China index, because this new index was not just... I mean, it was just beginning to start. So therefore, almost all of our contracts were based on this, on, on this, Chinese terms. Now, during this year, as I mentioned, there are a lot of efforts were going on. We could switch substantial amount of customers to the new indexing. You know, although we don't disclose an exact number, I think with an estimate of around 50/50, I think it's quite a good estimate to go forward. As I said before to Thomas, during next year, our aim is really to go into a range of 0-100, to shift all these contracts to the non-China index. So that would be, you know, the first part of your question. Well, the second part of your question, so was kind of the pricing level. I mean, this is always quite a challenge for Polysilicon. Hard to judge. What we can say is, and Tobias mentioned it in his part, there's a very high demand for this material, which is made outside of China, and therefore, I think there's a substantial premium possible. Yeah, then on your question on the industry power price and reshoring update, could talk for hours now, but I won't. We have been in very intense discussions also in recent weeks. Maybe you've seen there was a meeting with the German Industry Association, Chemical Industry Association, with together with the German Chancellor, some ministers, and some heads of the regions. That was end of September. We met a lot of pressure. There were high expectations. The outcome was, at that stage, not satisfactory, and therefore, you know, discussions are going on. We keep pushing for this industrial power price in Europe. In Germany, there's a broad coalition now, also, with trade unions, from the chemical side, from the metal side, also the industry associations of these industries all together. So a broad coalition for introducing this. And recently this week, the German Ministry of the Economy and Vice Chancellor Habeck, he published a paper, Industry Strategy for Germany, where it's clearly stated, that an industrial power price or a bridging, Brückenstrom price would be, an essential tool, you know, for keeping Germany as an attractive industry, site. A very good paper, in my view. So everything is prepared. It now comes up to, the government to make a final call. And, you know, I'm-- you know, it's always a tough time to predicting political decisions. What we do hear is that in the middle of November, there will be decision on the final budget for 2024. Is that final final? Don't ask me, but that's at least another milestone, cornerstone, where we hope to get a clear decision. Today in the news, you could read just a few hours ago, that what do you call that? Estimate. There's a new estimate on German taxpayers, and that says in the next five years, there will be EUR 25 billion more on taxes paid versus the last, you know, assumptions. So actually, that would equal the industrial power price, EUR 25 billion. And I hope Mr. Lindner, you know, is moving a bit faster than he has been before. That's really helpful. Just one quick follow-up on your first comment around pricing and, you know, it being a very tight market for you guys in terms of people wanting your product more than you have available. I mean, do you sense that across the board when you look at the maps and you think about the US market and other markets where your product has that premium? Do you sense that, you know, there's a chance that pricing move to kind of reinvestment economics? Do you think it will behave that way? Well, I think at the moment, I would say it's very much driven by what you say is the U.S. regime on import for the solar modules, proving that it's forced labor free. That's certainly a driver for the high demand of this material. It could definitely go in the range of reinvestment, but I think that's, at the moment, not really the question. The question is more the supply and demand that drives the price, in my view. Okay, understood. Thank you very much. The next question comes from Jaideep Pandya, Pandya from On Field Research. Please go ahead. Thanks. First question is on the tax credits that you potentially are eligible for in the US. Could you give us some sense, you know, on what sort of volume should we be calculating the $3 tax credit, and would it be applicable also for semi? And, given you haven't got anything for 2023, could 2024 have two payments instead of one payment? Second question is really around your raw material and energy bill. So can you just give us some color of where you are with regards to your raw material inventory drawdown, and sort of, you know, what deflation you would have got this year, if you hadn't been sitting on this inventory? On the energy side, what sort of hedging have you done on electricity and on gas for 2024? And the last question really is around the Polysilicon sort of debate. I mean, if you think about the international market, do you see that the market is gonna remain tight for the next two years or so? Because there is quite a lot of non-Xinjiang capacity coming in China, which could potentially use non-Xinjiang silicon metal... and actually be eligible for the U.S. or the European market. So do you think that, you know, the $20 REC sort of floor that they have signed is the floor, or do you think that, yeah, there is a one-year window or two-year window maybe, and then international markets will also be flooded with sort of non-Xinjiang Polysilicon from China? Thanks a lot. Jaideep, Tobias here. I would give a try to your first three questions. First, on tax credits. Yes, we expect those to have an impact next year, but they—as you equate, they will depend on the production volume in the U.S. Unfortunately, as we described, we had a shutdown in the first quarter, and then as we reported in the third quarter, we also had a plant maintenance, and that turned also into a larger maintenance, so we have not had full production. We run mostly on semiconductor, which is a more demanding product specification, so the overall volume is not at the original nameplate capacity of 20 KT, as we had designed the plant for, for solar capacity. So for that, that means that the numerator for calculating the credit is lower than 20 KT, but we expect to file with a tax return with a tax filing in the second quarter and claim a credit. I'm then normally conservative how to account then for 2024, but if it gets approved, I think we would also see a good accounting approach to yeah take it also for 2024 as a credit before then filing again in 2025 the tax. On raw materials, your second question. We had seen a significant decline in silicon prices. I mean, this is the biggest raw material for Silicones and Polysilicon, and we have seen a significant decline for all polymers raw materials. I start with the polymers. We have a net positive pricing, as you know, and that supports our profitability significantly in 2023. For Silicones, our pricing on the sales side was driven by supply and demand, and we talked very much also about that weak environment for specialty volumes. So we were burdened by the high silicon metal prices. If you remember, silicon metal prices shot up from 2021 to 2022 by a factor of two. I mean, for short term, also by a factor of three and four. And now throughout the year, silicon prices have halved, roughly halved, but throughout the year, and that has not hit yet our P&L. We fully hit the P&L as we still work through the inventory. And we do everything to clean up 2023 to get a much better start in 2024, but that's a lot of work. I must say it because the volume turnover is lower with a lower demand environment. To your third question, hedging of power. We have different hedge levels. We are significantly hedged. That means more than three quarters for gas at still very attractive prices for 2024, and we are hedged slightly above 50% for power, for electricity for next year. So then, I mean, it very much depends how our spot price is developing because if you would believe that spot prices would not be lower than today's forward prices, we should hedge. That's a bit unknown. Today, there is a risk premium for buying forward contracts. The question is: Is that risk premium then justified if you come to the actuals, or does it go away as it has gone away throughout this year? If you remember, what hedges could you have bought last year for 23 and how spot prices have developed on the electricity side. That's for power. Okay, again, on your question on the Xinjiang poly. Well, first of all, I think we have to state that already today, I mean, there's not only Xinjiang poly available in China. There are already capacities outside of that province which produce the material and obviously have no influence on the pricing. So at the end of the day, I mean, it's hard to say because, CBP in the U.S., they are looking at the whole value chain, and they want to have that certified. And, you know, the big question mark is what kind of certificates they would accept. So it is not only the Polysilicon where they would need a certificate where it's produced, but they would also need a certificate of the raw materials, which would be essentially the quartz and also the coal, where that is produced. And the big question mark is if a Chinese certificate would be sufficient, for CBP, to be accepted. At the moment, we don't see that. And therefore, I think the question is not really about, is it these new capacities coming up in non-Xinjiang? I think it's more the general view on Chinese capacities and the certificates made by the Chinese players. If I can just ask one follow-up on this topic. You know, when you're talking about the shift of contracts, can you give us some, like, qualitative color? Are these new customers that you're going away from the China, for China to the international price, be it in the U.S., or are these actually Chinese customers who are willing to accept international price because they want to service more international markets, or is it a bit of both? Well, it's kind of, it's a little bit of both. It's a mixture. And I mean, as you know, the Chinese play an important role in the whole solar value chain, and therefore, of course, they play a role also in this, in these markets. But there are also non-Chinese player that show interest. So, it's a mix of both. Thanks a lot for all the clarity. Right. The next question comes from Chetan Udeshi from J.P. Morgan. Please go ahead. Yeah. Hi, thanks. I just wanted to follow up on your comments on Polysilicon, because I'm very confused. If I heard, Chris, you correctly, you said already 50% of your Polysilicon contracts are indexed now this year to ex-China pricing. I mean, if that's the case, why is your Polysilicon profitability so low in Q4? It's like EUR 25 million, which should be your profitability in semiconductor business. I guess your solar business is not even making money in Q4. So I'm very, very surprised if that sort of contract shifting has been achieved, that the profitability of Polysilicon is not better, at least on guidance in Q4. That's the first question. Second question I had was, I just wanted to understand, you know, you sometimes give us this book-to-bill numbers for some of your businesses, and I think it's just a useful for us to know how that is tracking across your, you know, two main chemical divisions today, which is--which are Silicones and polymers, as you think about it into Q4. I mean, I don't want to--we know the seasonality, but I'm just looking at more the underlying. Is there any spark in that book-to-bill? You know, is it going above one, or anything that would be useful. And the last question on your Biosolutions business. Can you remind us how much should we be modeling, in terms of earnings or, or contribution from your agreement with the German government, next year, in terms of, contribution to Biosolutions? Thank you. Okay, Chetan. I'll start with the first question on the Polysilicon. Yes, what we said is that roughly about half of the material is still indexed to the Chinese index, and the other 50% is not. Yet we've seen also, as we mentioned at the end of Q3, a lowering of prices for both these indexes, and that's also what we, you know, put into our guidance for Q4. So, lower prices, but also keep in mind, compared to the previous quarters, especially Q2, we see lower numbers, lower volumes in Q4, which is comparable to the Q3 numbers. And these two effects, so lower pricing for solar-grade material, but also volumes at the same level lead to this decline in EBITDA. And I think there's... Yeah, that's, I mentioned we are maybe a little bit cautious on the December pricing, but that's the reason why we see these numbers a little lower. Yeah. Chetan, we are here on the second and third question, book-to-bill. I mean, yes, we do look at that, but we have seen there some false starts throughout the year, so we are very cautious. That's why we look at a different or a diverse set of metrics, also volume, and 'cause-- and, and that's by product, because we also need to watch out for, are there any mixed effects that would have an impact? So, from what we are seeing, it's flat. There's no uptick in demand, and that's why we-- in addition to that, we bake in some seasonality towards the year-end. I-- that, especially in the Silicones business, for the reason that our specialty, focused portfolio, customers will be cautious towards year-end if they do not have a clear outlook into 2024. For polymers, it's the normal seasonality from the construction activities that we see. To your third question on biosolutions and how much we expect from the mRNA contract with the German government, we expect that to start mid-next year. We are good with the investment in the second quarter, so we won't have the full year effect, but it is a significant contract. I think we do not disclose the overall revenue, but count, yeah, account for it, starting mid of next year. Thanks. Can I follow up just last clarification? Your Polysilicon business for the solar market, is that profitable right now in Q4? Chetan, we don't report below the segment level. Well, I'm just curious because I can estimate all of your profitability today in Q4 just from your semi business. So, I'm just curious, you know, is that a right assumption that, you know, your solar business hardly makes money right now? We stick to our policy. Sorry, Chetan. So- Okay. No information below the segment level. Okay, that's great. Thank you. The next question comes from the line of Andreas Heine from Stifel. Please go ahead. Yeah, thank you. Two from my side as well. I try again on 2024 on biosolutions. So the last two years, you had integration costs, digitization costs, and preparation and pre-start costs. Is 2024 a normal year, or is that where we have to where you have to absorb, again, additional, additional factors, additional negative factors? And the second is actually on the net working capital. It was down 6%, as you mentioned. Sales are significantly more down. So do you have to do also on your end, substantial cleaning on your inventories, or how do you see this progressing? Okay, Andreas, I will start with the first question. Biosolutions, will 2024 be, what you call a normal year? Well, as Tobias just mentioned, I mean, we are planning to ramp up for the pandemic preparedness plan for the mRNA site in Halle, you know, in the end of Q2 time frame. So until then, I wouldn't call it normal because then it would be more normal once this facility is running. But also keep in mind, we are also in the middle of a transformation for the business. We are integrating now the site in León, ADL. Halle is coming, and so I would expect that, you know, during this year and to the end of the year of 2024, we would see much better results also from all these efforts we put into the business. We believe in these opportunities. We believe in the great opportunities that we also acquired. It's, I think, very clear also to say that the current squeeze in the biotech funding scene is giving us a headwind. So therefore, a pipeline of projects might be delayed in one or the other case. But also what I would like to mention, I mean, if you, if you look at the Q3 numbers, it looks like, you know, there's kind of, you know, substantial growth. Keep in mind that, our Biosolutions business today has also a significant part of legacy business, which is down to a comparable level with a lot of chemical business at Wacker, but also in the rest of the industry. And the biopharma business is actually progressing quite well. And this is also part of these numbers. So, we remain committed, we remain optimistic about our plans, but we are still in the middle of that transformation. And I'm, you know, optimistic that, you know, by the end of next year, middle to end of next year, we see a much better performance. Andreas, on your net working capital question for 2024, we are not there yet, so it's a pretty detailed item for the guidance. Let me think through the moving parts. I mean, we've made significant progress. If I just take the example of silicon metal, we reduced it by a third from end of last year to today, and we are going to cut it by 50% towards the year end. That definitely has a significant effect if you then also include the price effect on silicon metal. I believe going forward into 2024, we should have still some opportunity also in the long supply chains, especially of Silicones, to still reduce volumes. We would also see some price down effects from raw material and energy costs. On the other hand, if demand picks up, you build again inventory, and you need to make sure that your delivery times are appropriate, and that will be then a countering effect. In addition, when sales pick up, receivables also will go up. There are quite some moving parts, especially in a dynamic environment. Please, yeah, allow me to be cautious not to give you a number for 2024 today. We are still in the working. It will be—I mean, there will be definitely an effort, that's what I can say, an effort to release cash from net working capital, and there will be also projects working on inventory targets, but there will be many moving parts if then the demand finally picks up again. Thanks a lot. But is it fair to assume that especially in these very complex value chain in Silicones, where you have thousands of different grades, and that the underutilization will continue quite a bit because you run down your inventories, you have also unfinished goods, or is that too negative? ... It's a super complex value chain. So yes, that would lead to some still running in low utilization. But that on the other hand, that's why I was referring to when it picks up, you need to make sure that you have your intermediates ready for the downstream plants to produce, and that makes it a bit tricky. But it is a fair observation that our inventories, volume-wise, are still higher than before the pandemic. They were super low during the pandemic, and then that went up through that, through those very strong years that we experienced in 2021 and 2022. Thank you. And if I may squeeze in a third one, on Silicones. You mentioned that you produce the standard products to fill your capacities to have a decent utilization rate. At this currently very low prices, do you still have a positive gross margin on standard products? Yes, we definitely only do it when we have a positive margin. If not, we shouldn't. Okay, thanks. We do have a follow-up question from Jaideep Pandya from On Field Investment Research. Please go ahead. Sorry to jump onto Andreas's line of questions on Silicones. I just want to understand, you know, your-- as per your guidance, you're gonna lose about EUR 700 million of sales this year and about EUR 620 or 630 million of EBITDA. So it's almost like a one for one sales to EBITDA ratio. You've alluded to quite a lot of these factors, but just want to understand, you know, even if demand remains at current levels, if you don't see a major pickup, should we think that, if standard prices have stabilized and specialty prices don't, you know, fall as dramatically because these are specialties, the raw material benefit alone should get you to sort of back to the at least EUR 350 million level, i.e., towards the, you know, 10%-12% margin range, not the sort of 20% or 80%-20%, which you used to do, but at least somewhere in between the current extremely low profitability, and sort of the mid-cycle level profitability. Is the raw material sort of savings enough for that, or you would need improved utilization as well for that to happen? Jaideep, Tobias here, as I said to Thomas at the very beginning of our Q&A, we are not at guidance yet, but we talked through the moving parts, and you mentioned two of them, the input costs and the sales prices. And, as I said before, I would be cautious. I mean, we—yes, we have lower exit rates in the input costs, which give us a relief, but on the other hand, we also have lower exit prices for our sales prices. And that makes it tricky. So, I don't want to comment on your calculation for that reason, for that exact reason. If I just ask a second follow-up on Polysilicon, how is the inventory level in the hubs? I mean, what we are hearing is China will have a very strong Q4 installation-wise, and inventory levels are low. How do you see inventory levels and therefore near-term pricing? When I say near-term, meaning Q4, Q1, you know, what are the chances that we remain sort of around these levels? Because obviously, you guys are, you know, penciling in a lower price, but some of your Chinese competitors are actually saying the other way around. So what do you see with regards to inventory levels in China? Well, I mean, what we do see, Jaideep, is, as you mentioned, there is a high demand on the installation side. I'm cautious if there is a big pull on the Polysilicon side. I think there's some inventory also on the modules. So that's the reason why we said we are a little cautious on the pricing side on December, but, you know, it all depends on, you know, how much material is actually used. And I would like to add maybe one comment also on the silicon side. I think, you know, not giving you more details, information than Tobias, of course. But I think the main question is really the demand side, when that is picking up. And as we said, you know, several times now, we don't see it now in our books picking up. On the other hand, I mean, if you talk to our teams on the development side, working together with the customers, I mean, all these projects are going on, and new projects are coming into that pipeline. So the intrinsic interest in that material, in these specialties is there. But again, as we don't see it in our books today, we don't pencil it into our calculations. Fair enough. Thanks a lot. There are no further questions at this time, and I hand back to Jörg Hoffmann for closing comments. Thank you, operator. Thank you all for joining us today and for your interest in Wacker Chemie. You see our upcoming events for next year at the back of the slide deck. As every year, you should expect us to publish preliminary results towards the end of January or early February next year. Please note that our next conference call on results is scheduled for March 12, discussing full year 2023 results. We also plan on holding a capital market day in June at our main site in Germany, Burghausen again. In the meantime, don't hesitate to contact the IR department if you have further questions.