Thank you for standing by, and welcome to the presentation of Chr. Hansen's interim reports and conference call Q1 2021/2022. At this time, all participants are in listen-only mode. There'll be a presentation followed by a question -and -answer session, at which time, if you wish to ask a question, you'll need to press zero one on your telephone. I must advise you that this conference is being recorded. I would now like to hand the conference over to our speaker today, Chr. Hansen CEO, Mauricio Graber. Thank you. Good morning, and welcome everyone. Together with our CFO, Lise Mortensen, and our team, we would like to wish everybody a happy new year and hope you and your families are healthy and safe. As always, we will start this conference call with a short presentation on our recent quarter's results. In addition, this time we would like to also take the opportunity to present our new science-based climate targets that were published in November. This will take approximately 20 minutes, and then we will move on to Q&A. Before we begin, please take notice of the Safe Harbor statement on slide two. Let's turn to slide three, please. Chr. Hansen delivered a solid start to the fiscal year 2022, with 9% organic growth, with EUR growth reached 10%. Growth was fully volume driven and supported by solid growth in Food Cultures & Enzymes, as well as a strong rebound in Health & Nutrition. Our EBIT margin before special items was 24.4%, compared to 25.2% last year. Excluding HMO, which was not fully reflected in Q1 last year, we would have seen a margin improvement as scalability from solid sales performance more than offset the inflationary pressure and the general ramp-up of activities. Absolute EBIT before special items amounted to EUR 65 million, up 7% from the EUR 61 million in Q1 last year. Free cash flow before acquisitions and special items was EUR 55 million, compared to -EUR 7 million last year. Let's turn to slide four for the strategic and operational highlights. During the first quarter, in-person engagement with customers picked up again, and we saw good traction on our commercial pipeline and strategic initiatives. Our core businesses— Food Cultures & Enzymes, Human Health, and Animal Health— grew 7%. For our growth areas, which account for approximately 10% of group revenue, bioprotection, fermented plant bases, Plant Health, and HMO grew 35%. Lighthouses are expected to outgrow the core business for the year, but please note that the very strong growth in Q1 was in part positive due to order timing. In line with our 2025 strategy, we continue to reinvest in our core business and leverage our technology platforms to expand into new areas, while further reaping the benefits of our recent acquisitions. Let me briefly comment on the key highlights for the quarter. In Food Cultures & Enzymes, we saw very good sales project execution in EMEA, as well as continued strong growth in the cheese market in North America, which led to very solid volume growth in Q1. Human Health exceeded our expectations for the first quarter and delivered a very strong start to the year, supported by a rebound in the traditional sales channel in Europe and North America and positive order timing from Q4. Further, I am pleased, with our expanded strength-t o -solution offering and our strong supply chain performance, we were able to mitigate supply chain successfully and win new business, which will have a positive impact in the first half of the year. Our HMO business also reported good progress with the first launches of the 5 HMO -Mix in the U.S. market, which had an extraordinary impact in Q1 as customers ramp up ahead of their product launches. Lastly, Plant Health entered into a partnership with the Indian ag player UPL to develop and commercialize microbial crop protection solutions. Another highlight during Q1 was related to Bacthera, our joint venture with Lonza. Please turn to slide five. In November, Bacthera signed a commercial manufacturing agreement with Seres Therapeutics. It's an important milestone, and therefore, allow me to say a few words about the agreement. After we have successfully established our setup in Hørsholm and Basel to service customers in the clinical supply market, we are now accelerating investments into commercial manufacturing capabilities based on the long-term commitment from Seres Therapeutics, whose lead candidate, SER-109, has the potential to become the first ever live biotherapeutic product in the market. As part of the agreement, we will build a new production site in Visp, Switzerland, which is expected to be inaugurated in 2024. Once the commercial supply market is materializing faster than we expected, we are seeing that the clinical supply market is developing slower due to delays in clinical trials and patient intake during the COVID-19 pandemic. These developments will require additional funding into Bacthera, but we are very confident in our ability to establish a leading player in the field, which can count on our expertise and capabilities from both JV partners. With these words, let's turn to slide six to dive a bit more into the sales performance during the first quarter. If we look at the top-line performance across the segments, growth was fully volume-driven. Food Cultures & Enzymes delivered 7% organic growth in Q1, driven by volume and with solid growth in dairy and very strong growth in food and beverages. The contribution from EUR pricing was insignificant. Health & Nutrition recovered after a very soft quarter, reaching 13% organic growth in Q1. Human Health and HMO delivered very strong growth. As already mentioned, the rebound was largely driven by Human Health, while HMO was in line with expectations. That said, I'm very pleased that a large part of our fiscal year 2022 orders for HMO is already secured through long-term contracts. If we look at our Animal and Plant Health business, growth was solid and driven by Plant Health. We benefited from early orders, while Animal Health faced a tough comparable from last year. Across our businesses, we are in close collaboration with our customers to implement price adjustments to reflect the current inflationary pressures. The implementation is progressing as planned, and we will start to see the impact here from the beginning of Q2. If we look at the regional picture, please turn to next slide seven. Growth was largely driven by developed markets. Europe, Middle East, and Africa delivered 10% organic growth, supported by good execution of the sales pipeline in Food Cultures & Enzymes, and a recovery of the traditional dietary supplement channel in Europe. North America grew strongly with 12%. Growth in Health & Nutrition was positively impacted by order timing, as Q4 was very soft. I already mentioned launches in HMO, while FC&E continued to benefit from continued solid momentum in the cheese market. Latin America reported 8% organic growth, of which approximately 1/3 came from EUR pricing. Food Cultures & Enzymes grew solidly despite continued soft fermented milk markets. In Health & Nutrition, it was driven by very strong Plant Health. Lastly, in Asia -Pacific, after a soft year-end, we returned to growth driven by Food Cultures & Enzymes that saw a positive growth in China. The fermented milk market in China, though, is still not developing favorably, and our outlook for China is still to be flat to slightly positive in fiscal year 2022, driven by the low comparable from last year and specific customer projects. Health & N utrition was on par with last year. Both Human Health and Animal Health faced a tough comparable baseline from last year. In total, this resulted in 4% organic growth for Asia -Pacific. With these comments, I would like to hand over to Lise for the financial review. Thank you, Mauricio, and welcome also from my side. Please turn to slide eight. Looking at the development on profitability, the EBIT margin ended at 24.4% for Q1, down from 25.2% last year. The drop was in line with our guidance, driven by: first, the full inclusion of HMO, which was only partly reflected in last year's numbers as the acquisition closed mid-October. Secondly, the general ramp-up of activities, including travel. And thirdly, higher input costs from the inflationary pressure, which we only expect to see recovered in sales price increases as we progress through Q2. This was then partly offset by a positive contribution from production efficiencies and scalability from the sales growth, combined with synergies from our probiotics acquisitions. If we exclude the impact from HMO, then the EBIT margin would have been above last year by approximately 0.5 Percentage point. Total EBIT before special items amounted to EUR 65 million, which is 7% up compared to last year, driven by Food Cultures & Enzymes, while EBIT in Health & Nutrition was at the same level as in Q1 of last year due to the negative impact from HMO. If we look at the segments, Food Cultures & Enzymes EBIT before special items was 13.8% and on par with last year, with production efficiencies and scalability effects from volume growth being offset by higher input costs not yet reflected in the sales prices and a general ramp-up of activities. Health & Nutrition's EBIT margin before special items was 11.9%, which is 1.7 percentage points below last year, driven by HMO. Excluding HMO, our Health & Nutrition EBIT margin would have been above last year. The profitability improvements were driven by scalability effects and acquisition synergies that were partly offset by higher input costs and the general ramp up of activities. Let's look at the cash flow on the next slide nine. The free cash flow before acquisitions and special items came in at EUR 55 million, compared to a negative EUR 7 million in Q1 of last year. The increase was due to both an improved cash flow from operating activities and lower operational investments. The increase in the operating cash flow was driven by improved operating profit and a positive impact from working capital compared to Q1 of last year. Cash flow used for operational investing activities was EUR 18 million, down from EUR 52 million in FY 2021. The decrease in spending was driven by the acquisition of the Kalundborg facilities last year. The return on invested capital, excluding goodwill, was 20.0%, compared to 20.6% last year, and the decrease was driven by Health & Nutrition due to the inclusion of HMO. While the return on invested capital in Food Cultures & Enzymes was on par with Q1 from last year. With these remarks, let's move to the next slide 10, to recap our guidance for the year. Following the encouraging first quarter, we keep the outlook for the year. Group organic growth is expected to be in the range of 5%-8% and will largely be volume-driven, but with some positive impact from pricing to reflect the inflationary developments. Food Cultures & Enzymes is expected to deliver solid mid-single digits organic growth throughout the year and despite an insignificant contribution from EUR-based pricing. Organic growth in Health & Nutrition is still expected to be volatile across the quarters, but is now expected to be more front-end loaded than earlier estimated. As already mentioned, Plant Health benefited from early orders in the first quarter, which will negatively affect Q2. For HMO, as Q1 benefited from customers ramping up for the U.S. launches, the growth momentum will be lower the rest of the year, though still in a range above 20%. For Human Health, our ability to serve customers has resulted in some extraordinary wins in Q1, and we also see good momentum going into Q2. When it comes to EBIT margin before special items, this is still expected to be around the same level as last year, between 27%-28%, as cost synergies from the probiotics acquisitions, production efficiencies, and a small positive impact from the U.S. dollar exchange rate will be offset by continued ramp up of activities, investments into HMO business, and the inflationary pressure on certain input costs. The latter we expect to largely recover during the course of the year as price adjustments become effective. The free cash flow before special items is expected to be around EUR 140 million-EUR 170 million, as improved operating profit is expected to be more than offset by significant increases in taxes paid, as FY 2021 was positively impacted by acquisition-related one-offs. The free cash flow outlook assumes a CapEx in line with FY 2021. As you remember, we updated our long-term financial ambition last quarter to reflect the divestment of Natural Colors and the acquisition of Jennewein. I would like to emphasize once more that Chr. Hansen remains committed to delivering industry-leading profitable growth and a strong cash flow with focus on spending discipline and capital efficiency. Until FY 2025, we aim to deliver mid- to high single-digit organic growth average over the period, an increase in EBIT margin before special items over the period to above 30%, and average growth in free cash flow before special items to grow faster than EBIT before special items. With this, I would like to hand back over to Mauricio to present our new climate targets. Thank you, Lise. I'm very happy to present Chr. Hansen's new carbon reduction targets that were published in November 2021 following the validation by the Science Based Targets initiative. Please turn to slide 11. Chr. Hansen's microbial solutions enables healthier living for humans, animals, and plants, leaving a positive handprint in society and our planet. At the same time, we are committing to reducing our footprint. Taking climate action that is rooted in the latest scientific consensus is a natural next step for Chr. Hansen. By 2030, Chr. Hansen aims to reduce its Scope 1 and 2 emissions by 42% and its Scope 3 emissions by 20%. To reach these ambitious goals, we have launched a new program called Think Climate. Naturally., under which we will pursue a number of initiatives, including converting total electricity supply to renewables, reaching 100% recyclability of our key packaging materials, and 100% circular management of our biowaste, working smarter with heat supply, and switching to refrigerants with limited climate impact, engaging with suppliers to address low -carbon practices and renewable energy, and by minimizing air freight and moving to sea freight and pursuing partnerships on low -carbon fuels. Some of these initiatives are already paying off not only on our footprint, but also on our costs. Converting to renewable energy sources like solar panels here in Denmark, for example, has kept the negative impact from the increasing energy prices down. With this, let me wrap up this presentation and summarize that Chr. Hansen delivered an encouraging start to the fiscal year 2022, and we keep our outlook unchanged. 2021, 2022 is a year of execution for Chr. Hansen, and we remain focused on advancing our 2025 strategic agenda, driving commercialization of new innovations and delivering synergies from our recent acquisitions, while mitigating any potential disruptions from supply chain constraints and implementing price adjustments in close collaborations with customers to offset inflationary pressures. Times continue to be uncertain, with high volatility from COVID-19, increased focus from customers on business continuity and cost savings, potentially new travel restrictions which could impact our ability to advance our commercial pipeline, and low visibility to end market demand. I am optimistic that as a company, Chr. Hansen is well positioned to deal with these challenges, thanks to our robust and resilient business model. Thank you for your attention. With this, I would like to hand over to the Q&A. Thank you. If you have a question for the speakers, please press zero one on your telephone keypad now to enter the queue. Once your name is announced, you can ask your question. If you find your question has been answered before it's your turn to speak, you can dial zero two to cancel. In the interest of fairness and time, please limit yourselves to two questions per turn. You can then rejoin the queue to ask further questions if you need to. Please hold for the first question. Our first question comes from the line of Søren Samsøe of SEB. Please go ahead, your line is open. Yes, good morning, everyone. Two questions. First, regarding the input cost, if you could say what is the negative impact of input cost in Q1 versus last year? Secondly, if you can comment on the price increases you're seeing, the level of price increases which you'd expect, and what will be the effect of that down on EBIT? Will that all be absorbed by, you can say by input cost increases? Or how do you see it? Thank you. Thank you, Søren, and good morning. Just recapping, your question is about the input cost, our process for price increases. I would just say we have a very strong methodology overall to reflect price increases with customers. We expect to fully pass on the inflationary price increases to customers, so we have no margin dilution. I will pass it on to Lise to comment on, you know, your specific question about input costs. Well, on input costs and the inflationary pressure is obviously something that is unprecedented and that we are observing very closely. We have seen higher costs, and it's also impacted our results for Q1. We do not wish at this point in time to be very specific on it. But it is part of the, you know, the view that we look at landing the 24.4% for Q1. It's also important to say that we are actually very happy to see that if we exclude HMO, we have been able to offset inflationary pressure and other costs coming from the higher activity level through our productivity and scalability efforts. Okay. Thank you. Thank you. Our next question comes from the line of Lars Topholm of Carnegie. Please go ahead, your line is open. Yes, hello. Congrats with a very strong quarter. Quite impressive and good to see. A couple of questions on my side. Looking at your unchanged full year guidance, you need to grow 4%-7% for the rest of the year. Given you probably get 1%-2% from pricing, that means organic growth will only have to be, or volume growth will only have to be 2%-6%. I just wonder when you don't lift the lower end of your guidance range, is there any specifics we simply can't see? Or is it more a function of you preferring to be conservative in a scenario where visibility might not be so big? I have a question on HMOs because Abbott has launched their five HMO Similac product, which you supply. I suppose that's the big thing for your HMO business in the quarter. First of all, I would like to understand when you sell to a product that contains 2'-FL, and then instead sell to a product that contains all five HMOs, how much does your revenue proportion increase? Is it 5x up, or is 2'-FL still the main revenue contributor? I wonder what this implies for the HMO revenue in the quarter. You mentioned lighthouses are 10% of sales. If we assume bioprotection and Plant Health is 10% of Food Cultures & Enzymes. That means Plant Health and HMO has to be 10% of Health & Nutrition. I just wonder how that is split between plant and HMOs. Thank you. Good morning, Lars. Thanks for your positive comments on the encouraging start of the year. Two questions you had on guidance and on HMO. Let me try to provide some insight into those. For sure, an encouraging start of the year with good momentum across our two business areas. As I stated in the call, we also see good momentum going into Q2. You are right, it's still a very volatile environment. I think we're only let's say three months into the year of 12 months, and I think it's good to recognize that while we are in a good position in Q1, we maintain our guidance for the year. That is the position. Yes, you know, pricing, we expect the growth to be mainly volume driven. Pricing will contribute, you know, north of the 1.5% or around the 2% that you mentioned. We expect to continue to see a good performance of our business and hope that provides some visibility into our current guidance. Now on HMO. HMO, the HMO mix tries to reflect more the physiological level of the five different HMOs. You know, without going into confidentiality or distortion, we expect the different HMO mixes for different customers may have a slight different component. 2'-FL is the largest component of the mixes, but we see good presence of the other HMO ingredients there. Talking about the lighthouses, you know, all of them contributed to the strong performance of 35% in Q1. Obviously, as we mentioned, particularly Plant Health and HMO benefited from order timing in Q1. Yeah. That I understand, Mauricio, but my question is if Plant Health and HMO is 10% of Health & Nutrition turnover, that is EUR 9 million combined. If it's 50/50, then HMOs contributed EUR 4.5 million, and you have a big product launch from Abbott. Given that, in Q2 and Q4 last year, HMOs were EUR 6 million and EUR 7 million in revenue respectively, I just wonder if sort of the underlying run rate for HMOs was in fact weak given that you have this big product launch from Abbott. I'm just trying to- So a couple- ...to understand the numbers. A couple of comments. I think your calculation of HMO is not 100% correct. HMO was more than that. But also consider that while we had the launch of HMO in the U.S., Abbott has not yet done a national launch. It was launched online, and it was, let's say, what would be called a pre-launch. We do not consider the HMO performance to be below expectation. It's on target, and we are confident to deliver above 20% growth for the year based most of those orders being secured by our long-term contracts. That's very clear, Mauricio. Thank you very much. Thank you, Lars. Thank you. Our next question comes from the line of Christian Ryom of Nordea Markets. Please go ahead. Your line is open. Hi. Good morning, and thank you for taking my questions. I have two as well. The first is a clarification on the HMO topic that we just touched on. Can you clarify whether, in terms of absolute revenues, Q1 here was your best quarter yet for HMO revenues? Then my second question goes to the sort of guidance for the Health & Nutrition business, where I understand that you say that the growth will now be more front-end loaded for the full year. Should we understand that to be a reflection of some pull forward of demand for the following quarters, or from the following for the next quarters? Should we merely understand this as a reflection of a high growth rate in Q1 that will not necessarily repeat in subsequent quarters, but not a matter of growth having been pulled forward? Thank you. Yes. First question on HMO. I will pass then on to Lise. I think it'd be important to clarify, you're talking sort of the absolute in absolute terms being the largest quarter in invoicing that we have had. I will take that on. You know, Health & Nutrition had a strong start of the year, 13% stronger than we expected, basically driven by the good momentum reopening of the traditional sales channel in North America and Europe, and also by our ability to win new project based on the good execution of our supply chain. As I said, we go into Q2 with a good momentum in Health & Nutrition, and that's why we said that the, you know, growth will be front and loaded because we expect a solid first half of the year for Health & Nutrition. While some people think there are low comparables in the second half of the year, I would just remind everyone that the low comparables in the second half of the year was for our Chr. Hansen business, but that our acquired business that were not part of organic growth in H2 had a very strong performance. The comparables are not as easy as people might think. Lise, on to you for the question of HMO. Yes. Let's be clear. We would like to avoid to give you absolute numbers on the revenue from HMO. What we can confirm is that the ambition for this year is at 20%+ organic growth on the baseline from last year. Yes, we did see some impact from positive order timing in Q1. Okay. You cannot say whether, say, Q1 was better than Q4 in terms of revenue for the HMO business? No. Okay. Thank you. Thank you. Our next question comes from the line of Georgina Fraser at Goldman Sachs. Please go ahead. Your line is open. Good. Thank you for taking my question this morning. My first question is, if you're able to quantify to any extent just how much of the organic growth in Human Health was front-end loaded in the first quarter. I think it'd be quite helpful to have that kind of aggregate number. My second question is, I noticed that you have reduced your market expectations for Human Health over the course of 2020-2025 on the back of lower infant formula outlook. Can you explain why that assumption has not changed your expectations for the total addressable market for HMOs? Thanks. Hi, Georgina. Good morning. I'll take the first part of your question in relation to what part of the growth on Health & Nutrition was sort of underlying growth versus one-offs, and then I'll pass it on to Lise in relation to the infant formula and market potential. You know, most of our growth in Human Health, as I said, came from the strengthening of the momentum, positive development we saw in the traditional sales channel in North America and in Europe, as well as the new wins. You know, order of magnitude less than 1/3 of the Health & Nutrition growth would be related to one-off benefits related to Q4 orders that we were able to fulfill in Q1 or other non-repeatable. Most of the growth came from this momentum that we have seen in Q1, and we see maintained going into Q2. Lise. Yeah. You know, when we think about HMO, I think it's important to recognize that the penetration is very, very low. This is a business and a market that's only growing and emerging now as we speak. We do still believe that this is, you know, the secret ingredient that the IF players are definitely looking into with high, high interest. It will be that ingredient that creates the premium product. We still believe in the full potential, but it is, you know, coming from a very low penetration. Okay. That was really helpful. Thank you. That is consistent, Georgina, with what we have said both for HMO and probiotics. You know, a better momentum in infant formula growth will always be positive. Let's say our business plans are based on the penetration of probiotics and HMO into the existing volumes of infant formula. Great. Thank you, both. Thank you. Our next question comes from the line of Heidi Vesterinen of Exane BNP Paribas. Please go ahead. Your line is open. Good morning. I've got two questions. We see that milk and animal production is slowing relative to last year, and bird flu is emerging. Is this a concern at all in either segment? What are your expectations? Secondly, we saw that pricing was negative in Health & Nutrition. Could you explain why that was? Will that improve as we, you know, as you lift pricing in the coming quarters? Thanks. Hi, Heidi. Good morning. I'll take the first one on Animal Health and then pass it to Lise on the pricing for Health & Nutrition that was more related to a one-off situation, and she can explain. Good questions. Thank you for that. You know, we have seen pretty strong development in dairy farming, so we have not seen that impact our business in cattle and particularly in dairy farming for animal has been strong. I think it's driven basically by the innovation and the products we have put out, particularly, you know, in our probiotics solutions. I think on African swine fever, there you're right, you know, Animal Health had a very strong quarter into Q1 last year as the population of swine in China was growing again under better health conditions where our probiotics have played a role and now faced a larger comparable to that with definitely an effect of the African swine fever. Lise, on to you on the pricing question on Health & Nutrition. Yes, Heidi. It is related to the agreement we have on Plant Health with our partner FMC. It's just a consequence out of the regular kind of settlements that we make with them regarding how we recognize the revenues. It's a one-off for this quarter. I would definitely not read from that anything in relation to our pricing ability or pricing pass-through for our business. As Lise said, it's more related to a one-off in connection to the settlements in Plant Health with FMC. Just on my first question, also we see milk production is slowing. You know, cheese has been very strong for you in recent quarters. Could that have an impact in FC&E, or is that not a concern for this year? We don't view that as a concern for this year, Heidi, but we closely monitor, you know, the trends in dairy development both for cheese and for the fermented segment. Thank you. Thank you. Our next question comes from the line of Alex Sloane at Barclays. Please go ahead. Your line is open. Yeah. Hi, good morning, all. Congrats on the solid start. Two questions from me. The first one just on pricing to offset input cost inflation. I guess given the, you know, the small cost percentage and strategic nature of your ingredients, it wouldn't be, you know, too much trouble to kind of land price increases with customers. But on the other side, I wonder, you know, what is your base case expectation in terms of your customers' pricing action to offset inflation? And could that have any drag on FC&E end market volume growth for this year? Are you expecting any pockets of slowdown due to this inflation at all? The second question, just going back to HMOs and the 5 HMO -Mix, I mean, it's obviously early days, but if you could give you know any color on how that product is actually performing on shelf in the U.S. where it has been launched. More broadly on HMOs, you know, are there any regulatory milestones that we might expect globally this year that we should be looking out for? Any prospect of that 5 HMO -Mix, you know, being launched in further new markets over the next 12 months? Thanks. Thank you. Thank you, Alex, for your questions. I'll take those two myself. You know, on your question around pricing, yes, we have a very strong pricing methodology and in close collaboration with our customers. All I would say is like, the pricing negotiations are advancing as planned and on target, and we track those to, you know, conclusion of the negotiations and completion of the price increases, and that is tracking on plan and on target. You know, I don't want to mislead you. I mean, pricing negotiations with customers are never easy, but I think we have a very positive collaboration with customers on the understanding of the input cost and how they translate into price increases. Very pleased on how our organization is managing that and confident that we will deliver on the price increase targets that we have internally. On HMO, indeed too early to tell on sell through. You know, probably you follow that market very closely, you'll be able to get a better read from the reports from our customers. I think what we are very pleased from the 5 HMO -Mix is that everything that we expected on this being a front panel ingredient and positioned as the, let's say, important ingredient to make infant formula closer to mother's milk, that has been very clearly communicated in the product launches, which I think is positive for the HMO market overall. On regulatory, I think the biggest next step will be the regulatory approval of HMOs in China. We are working on that, but as we have stated, we expect that to take place in 2023-2024. Thank you. Thank you. Our next question comes from the line of Mattias Häggblom of Handelsbanken. Please go ahead, your line is open. Good morning. Two questions, please. First, coming back to the dynamics in the global probiotic supplement market, which benefited from the rebound, which you mentioned. Obviously, consensus expected 2% organic growth for Health & Nutrition. The quarter you come up strong at 13%. You talk about volatility to remain, but you also said, if I heard you correct, that momentum from Human Health into Q2 remains strong. What visibility do you have? And maybe help me frame what volatility here means. For example, can we rule out another negative quarter as we saw in Q4 last year, just to put volatility into perspective? And then secondly, if you can shed some light on historical growth rate for the lighthouses you have to put the 35% growth rate into context. You talked about that not being representative for the full year, but if I recall, we've seen a specific number for this. So maybe help me understand how strong that number is? Thank you. Absolutely. Thank you, Mattias. Health & Nutrition, indeed we have a strong quarter. We see good momentum going into the second quarter. When we talk about volatility, it's usually because it's a more concentrated business, and the way that orders fall into one quarter or another can sometimes make a quarter, you know, stronger or weaker. I would not mention specifically could you know, see a negative quarter. I think the benefit that we have now that the acquisitions are starting to integrated into our organic growth is we definitely have a much better balance in our total portfolio of, you know, end markets, portfolio strengths and channels. You would still see more volatility in Health & Nutrition as compared to Food Cultures & Enzymes. Maybe adding to it's also important again to highlight that the very strong execution we were able to deliver on supply in Q1 was also part of the success formula, so to say, of Human Health. When we look back in Q4, one of the things we were caught by was a raw material shortage, so that we actually kind of left business on the table that we couldn't execute on. That's part of our upside now. We do have a dependency on our ability to supply. During COVID, in general, we've been quite successful. Also we are not immune in the world we are operating in. I think that's also talking a little bit to the uncertainty to the way that we're looking into the rest of the year, but we are not adding any concrete pointers. It's just that this is in the environment where we're operating in. Just remind me, Mattias, was there a second part to your question that we have not addressed? Sorry. Yeah. Well, maybe you have to put the 35% growth rate for the lighthouse. On the lighthouses. Yeah. You know what we have always said is that the lighthouses have a potential to reach 100 million and will grow faster than the core business. You know, if you wanna make an assumption on the lighthouses, I always talk about the lighthouses being double-digit growth rate initiatives for us. If you see, you know, for example, bioprotection is something that has consistently been growing above 10%. I don't know that I would go and qualify a specific quarter on the lighthouses because these are very, still very small businesses. You know, percentage on a quarterly basis can be misleading. We are, you know, focused on delivering double-digit growth rate for our lighthouses year-over-year. That's very clear. Thank you. Thank you. Our next question comes from the line of Mirco Badocco of Bank of America. Please go ahead, your line is open. Yeah. Good morning, everyone. Thanks for my question. Just a clarification on my side, if you can. Now, you've mentioned benefits from timing of orders in Plant Health and product launches in HMOs. If you can clarify if there is any unwind here to be expected in Q2 or if it was just no repeatable benefits in Q1? Plant Health and HMOs, as I understand Human Health is just a one-time benefit there. Also if you can give us an indication on the performance of bioprotection in the quarter, it would be great. Thanks. I will take the one on bioprotection and pass it on to Lise to comment on the one-offs, timing of orders. Bioprotection grew around 15% in the first quarter, which is solid. I would remind you that even though we launched in spring the generation three, we are working in projects with customers, and we should not expect a larger contribution for the third generation of bioprotection before our second half of the year. Yes. Building on your first question, Mirco, you know, if we look at what was the one-offs in Human Health in Q1 that will impact the rest of the year, as we said, Plant Health, there was definitely a one-off in Q1. We expect to see a negative side of that in Q2. For HMO, there was some order timing benefiting in Q1, which will just level out over the year, but ending the full year at the 20%+ that we talked to. Apart from that, I would say from the rest of the rebound of Human Health, it was a lot of new business opportunities that materialized and where we don't anticipate the negative side of it the rest of the year. Understood. Thanks. Just following up on this, so on the Plant Health, I think you mentioned overall the one-offs were 1/3 of the performance in Health & Nutrition. How much of that 1/3 was the one-off in Plant Health? It's not big. It's not big. I also think when you think about one-offs, also think about into that, we also include the benefit we have from Q4. Right? It's not the largest Plant Health. Okay. Thank you. Thank you. Our next question comes from the line of Charles Eden at UBS. Please go ahead. Your line is open. Hi. Good morning, Mauricio. Good morning, Lise. Two questions from me, please. Firstly, can you quantify the China growth you saw in FC&E in Q1? Maybe if you could remind us the comparison or at least sort of a range, the decline in the prior year quarter. My second question is just a clarification to your response on one of the earlier questions on pricing, Mauricio. I think you said there would be no margin impact from the pricing. I just wanted to check I heard that right. Does your pricing model protect the gross profit or the gross profit margin? I thought it was the former, but maybe I'm incorrect, so I just wanted to clarify. Thank you. Thank you, Charles, for the good questions. On China had a solid growth against a low comparable from last year. That was mainly because, you know, Q1 of last year for FC&E was particularly soft. I wouldn't read much more into that from China, but I do believe our feeling is consistent with what we communicated in Q4, saying that we expect China to be, you know, flat to slightly positive for us for the year, despite the continued negative development of the fermented category in China. I will pass it on to Lise to comment on margin, but just to clarify my comments, I said when we pass prices, we pass on prices to make sure that we protect our profitability. If we think about the pricing impact and looking at our financials for this year, I think it's important to also call out that our price increases does come with some delay. The ambition is that we can increase the prices to offset not only just the cost but also the margin impact, but it will come with some delay this year. What do we base this on? We base this on that this is what we have usually done, and we are in a very good collaboration with the customers on it. Okay. Thank you. Maybe I can just follow up quickly. Do you think, are you able to say when you think your pricing will be in a position, given where raw mats are today, to fully offset the headwind? Are you able to give that detail? Well, it of course depends on whether we know the full magnitude of the headwinds at this point in time. It is very unprecedented times. I think, you know, the overall conclusion is that what we're doing here is baked into our EBIT guidance for the year, which is a landing corridor between 27% and 28%. We see around a quarter delay between, you know, our inflation cost input and our negotiations with customers. Yes. I think under more normal conditions, we would usually have one round of negotiation with customers. As inflation development continues to be more fluid, this year, we may have several negotiations of pricing with customers. Understood. Thank you everyone. Thank you. Our next question comes from the line of André Thormann of Danske Bank. Please go ahead. Your line is open. Yeah, hello, both of you, and thanks a lot for taking my question. First of all, in terms of this good momentum you mentioned in Human Health, I wonder if you could elaborate a bit on this momentum and also on whether this is driven by the UAS combination that has happened. My second question is in terms of Food Cultures & Enzymes, the strong performance that you have seen, whether there is some kind of reopening effect that has affected these numbers positively. That's my question. Thanks a lot. Yes. Let me start with Human Health, André, not much more than I can add to what we said. I mean, the strong performance in Human Health was really driven by the reopening of the traditional sales channel in North America and Europe. We are benefiting from our strength -to -solution strategy and the broader portfolio that we have in Human Health, where we are now able to commercialize across the combined units, the Chr. Hansen legacy, highly documented probiotics, and the addition of the strength from both HSO and UAS Labs. It's largely driven, but I would say a strong execution of our Human Health business. We also highlighted, and I will repeat that again, that we have a strong supply chain performance that enabled us to capture business and have new wins, while also fulfilling orders that we were not able to complete in Q4. That combination puts us also in a strong position with Human Health into the second quarter of the year. In FC&E, you know, it was mainly volume driven and mainly in developing markets. Very strong performance of projects in Europe, where, by the way, we were able to be more present with customers. The cheese market in North America, partly driven by, you know, a larger presence in food service as well, but where we see some cheese types like mozzarella continue to perform very strongly. Maybe we have time for one more question before we wrap up the session. Thank you. There is only one further question in the queue. That's from the line of Søren Samsøe of SEB. Please go ahead. Your line is open. Yes. I just had one follow-up regarding the lighthouse projects, where you can say you have earlier been quite concrete on the absolute potential of these, while you now seems a bit less concrete, which I completely understand. Maybe you can comment a bit. There must have been some delays in delivering on these sort of overall ambitions you have had there because of COVID. Maybe you can elaborate a little bit more on what we should expect in the long term. I of course acknowledge that this is quite uncertain and difficult to predict, but maybe give us also your thoughts there. Secondly, on Animal Health, which I understand was quite weak in Q1, actually, I can't remember whether that's because of some particular high comparables or the timing, but just comment what's the momentum in Animal Health in the underlying business going into Q2. Thank you. Søren, on Animal Health, Animal Health basically faced a difficult comparable, and the only thing that we mentioned as well was that in swine particularly, we had a high comparable from Q1 last year because of the strong momentum of rebuilding the swine population in China versus now a little bit the return of African swine fever. I think you could expect a normal momentum from Animal Health, you know, going into Q2. We have seen a strong performance on Animal Health throughout the last couple of years. I'm very pleased with the you know, how the team has turned the innovation into market execution and commercialization. On the lighthouses, Søren, in our Capital Markets Day, we basically provided what we view as the potential of those lighthouses, and then left it open to what our market share would be. I think that is a much better way to, you know, present these that are really business development opportunities where we leverage microbial and fermentation technologies that we know very well into new commercial spaces. It's business building from a very slow low base but with areas where we see a large opportunity and we're very excited about. You know, I would repeat what I just said, that the best way to think about our lighthouses is businesses that will grow faster than our core business and where we can expect, you know, double-digit growth rates year -on -year. For sure, you may have quarters that are higher or lower, but I hope that, you know, provides some perspective. Otherwise, you know, we'll be able to elaborate on this further as we talk going forward. Okay. Thank you for that. Thank you. With that, this concludes today's conference call and Q&A session. Thank you for calling, and we look forward to continue our dialogue during the upcoming virtual roadshows. Thank you all.