Welcome to the presentation of Schouw & Co.'s Q2 2024 financials. We overall had a very satisfying second quarter, in spite of volatility and tough competition. It really continues, and in all markets we are in the world. Our top line was down 5% to DKK 8.7 billion. Here we saw a negative impact from raw materials, and also from a lower activity level in some of our segments. Our EBITDA was, however, up 11% to DKK 737 million. It was driven by very strong development in BioMar, and I think also it was very satisfying that we, in spite of the tough competition and tough markets, managed to increase margins across the board. We have a very strong focus on delivering our results. Our investment level in 2024 have really been adjusted. It's a year of consolidation, so we have invested quite significant lower than the previous years. We are also running profit protection plans in all our companies to offset more soft and volatile markets. We have a small guidance update. Our top line is slightly down, but our EBITDA will now be in the range of DKK 2.81 billion-DKK 3.06 billion. From the overall look at the group, I will move into each of our six companies, starting with BioMar, the biggest company in our portfolio. BioMar really had a very, very satisfying second quarter, and they have, over the last years, had strong focus on profitability and innovation. Their volumes are slightly down, and it's driven mainly by the salmon segment, so meaning that a turnover of DKK 3.99 billion is 4% down. A lot of activities is going on to protect the profitability, and we have commercial excellence programs that really drives profitability uplift. Our EBITDA was up by 36% to DKK 361 million, the strongest second quarter we've ever had in BioMar. BioMar continues to have very good momentum in the market. They are building long-term relations with their customers, but at the same time, also focusing on credit and risks because when you really move large volumes and in a volatile market, things can happen. We're also establishing a new global ERP platform, investing around DKK 200 million to finalize one ERP in BioMar. Our guidance or BioMar guidance is changed to the positive. Top line, however, lower due to volumes, but a very strong uplift in EBITDA, and now guiding DKK 1.41 billion-DKK 1.48 billion. From BioMar, moving into GPV, which saw exactly the opposite of BioMar. They are as challenged as we expected. Top line was down 16% to DKK 2.28 billion. Soft markets in more or less all industrial segments around the globe. Order intake, however, slowly picking up. EBITDA was down 24% to DKK 144 million. Here we, of course, had an effect from lower sales. We also had impact from ERP cost, and also from closing down our operations in Malaysia. In spite of the market conditions, our contribution margin saw a small and very satisfying uplift. We have a full focus on protecting the long-term profitability in GPV. We are full focused on driving efficiency in all factories, reducing inventories, and also preparing for future by looking at the global factory footprint. As I mentioned earlier, we closed down our operation in Malaysia and moved it to other factories in the region. The guidance for GPV will see a downgrade. The expected uplift in second half of 2024 is not kicking in as we expected. Top line now expected to be DKK 8.9 billion-DKK 9.3 billion, and also meaning that we have to reduce our EBITDA now in a range of DKK 610 million-DKK 660 million for the year. Looking at HydraSpecma, we really saw a stable activity in a very uncertain market. Top line was up 2% to DKK 788 million, especially our newly formed renewable division were driving the growth. Our global OEM and Nordic IAM impacted from softer markets around. EBITDA, however, up 7% to DKK 88 million. Here we also saw synergies from the latest acquisition kicking in, and across the board in the HydraSpecma, we have seen very good cost management and efficiency. Also here, we see a company driving the agenda for future profit uplift. Factory footprint decisions are made throughout HydraSpecma. We are moving production to our new low-cost facilities, and also a lot of focus on R&D and innovation in specific segments. The guidance for HydraSpecma, slightly adjusted. EBITDA, now DKK 300-330 million, but it's still in the previous range. We see the effect from softer demand and a lower backlog. Activity and requests are expected to pick up ultimo 2024. Also looking into some very attractive segments as defense and marine, and so on, expect further growth from these segments in the future. Moving on to Borg Automotive. Here we really saw a solid development in all our segments. Top line was up 12% to DKK 548 million. Again, here we really face tough markets, tough competition, mainly from China products, and it is a challenge, and it will continue to be a challenge in the coming time. EBITDA, very satisfactory, 29% up to DKK 57 million. Again, efficiency up, but salary costs in some of our production units is really a challenge due to inflation and salary increases. We also saw a very strong profitability uplift in one of our troubled segments, products for steering. Borg Automotive continues to strengthen their market position in Europe. They have very strong brands and are active in both the reman and the Newman segment. We are extending our product offerings across the product groups. We have introduced around 140 new products in the last quarter, and we have a really strong focus on driving the circularity agenda and also on sustainability. Borg expects to keep the guidance from Q1, meaning that they're delivering EBITDA in the range of DKK 170 million-DKK 200 million. However, also, competition here continues to push hard in all segments, but we have a lot of tools in the box to withstand the competition. Moving on to the two Fibertex businesses, starting with the Fibertex Personal Care. Top line was, as expected, down 7% to DKK 488 million. FPC is active in two regions with very different dynamics. Looking at our Europe segment, Europe business, there we see a very strong demand, more or less a full capacity utilization, whereas looking into Asia, we have idle capacity, and there's a lot of very tough competition. I have elaborated on the reasons for that earlier on in my presentation, but especially low birth rates in China and overcapacity is the issue. EBITDA also down, as expected, 24% to DKK 44 million for the quarter. Again, as I mentioned already, fierce competition, low volume in Asia is really driving this EBITDA development. However, also seeing a negative raw material effect over the quarter. It is a raw material-driven company. We will see up and downs on that. Interesting also to see that there's a new dynamic in the nonwoven markets. Today, it's Asia driving innovation. FPC is well positioned to participate in this innovation. We see in Europe, increasing market share to private label brands, maybe not as sophisticated products. Also interesting to see that Southeast Asia now starts to grow. Full year outlook, slightly increased. EBITDA now expected in the range of DKK 170 million-DKK 200 million. Moving on to the last company in our portfolio, Fibertex Nonwovens. The very good development continues. The top line now up 7% to DKK 600 million. Most of the segments in FIN or Fibertex Nonwovens have increasing volumes. Fibertex Nonwovens are involved in a lot of different segments. Our new capacity in US, of course, also delivers a volume uplift. EBITDA in a very solid development, 50% up to DKK 58 million, and again, a strong effect from volume increase and product mix. US in a good development, but still challenging on the new production line for the wipes. We are transforming Fibertex Nonwovens for the future, something that has been going on for quite a long time. We have full focus on innovation and added value products. We have a new products in our pipeline. Very promising, very interesting new products coming in, and we are also looking very hard into how to utilize our new capacity to produce added-value products. Solid first half result drives positive outlook. Top line maintained. EBITDA expected to be in a range of DKK 210 million-DKK 240 million. So, concluding with expectations for 2024, the Q2 guidance update now, as I elaborated on earlier, per company, looking at it from a group perspective, slightly down on top line, but improving EBITDA guidance in the range of DKK 2.81 billion-DKK 3.06 billion. BioMar, of course, with very strong profit uplift, GPV hampered from challenging industrial markets, and that's the two main things in the new guidance from our side. So I think with this slide and these comments, I would open up for questions. Lars Heindorff, welcome. Thank you. Yeah, a few question from my side. The first is, Jens, the comment you made in the start of your presentation, you have, you know, introduced profit-protecting initiatives in all divisions. What does that actually mean? I think I said profit protection plan, meaning that when we see soft markets and volatility and so on, you of course need to work on a lot of different things. You need to work on your cost base, the way you go to market, and so more meaning that we are in front of things and careful on costs and investments and so on, because we have a strong desire to deliver on our profit plan and our guidance. Also, meaning when you are operating in volatile industrial markets, you need to be on top of things. So we are running plans in all. I said in all companies, in all fairness, in the five industrial component supplier companies, meaning BioMar, of course, also working a lot, but they have other things to work on. So maybe if we could drill a bit down. So does that mean you will start reducing FTEs? You've put, you know, travel, marketing, you know, stops... So what or is it more a plan that can be, you know, started if you see things worsen? Yeah, we don't go into all these details. Of course, in some different ways of looking at it from company to company, but in general, just saying we need cautiousness on a lot of things and be prepared to flex. Looking at the... If you look at FTEs, you can see GPV have reduced their FTEs with 1,000 people over the last year. So of course, they are moving on that issue also, if you look at that top line and the results and so on. So a lot of things is going on to protect our guidance and our profit. You've become more concerned compared to Q2 after Q1, where you didn't mention this? No, I'm just saying that, we can also... We are living in the world where we can see things are more soft, and when you see things softening up, then, you also need to be prepared and to do things. I'm just also telling the market that, of course, we are not sitting on our hands. If things starts to development, we have in all companies plans and discussions on how to offset if things don't go the way we expected. Very. It's always good to be well-prepared if things should be just deteriorating. Thank you. My second question is GPV. Yeah. You mentioned that contribution margin improved- Yeah ... but, EBITDA is down. Yeah. I know revenue was down. So does that mean you are unable to adjust your fixed cost base to a lower activity level? Is that possible in the coming quarters, or you need the scale to maintain your profitability? Yeah, but it's super relevant and good question, Lars. I said, as when I say, contribution margin in GPV improved slightly, but it's also good that they can improve their contribution margin slightly when we see the pressure on prices and everything in the market. Then, of course, scale means something, and we have also IT costs for the quarter we didn't have last year, and we have a cost base that we're working on. We had closed down costs on Malaysia. So we had costs below contribution margin that, of course, had an effect on EBITDA. But really, I think it's positive and worth mentioning that we can maintain a contribution margin at a reasonably good level in spite of lower activities. Okay, and then I don't want to disappoint you, Jens. So I will, I will ask an open question. Yes. Yeah. Yeah. What do you think about your development in net working capital? In fact, quite satisfied. Of course, I would have expected to see it a little bit down, but you also know sometimes it moves from quarter to quarter. But main reason for that is debt in BioMar. So there is a... We know where things have been moving, and we are still on it, and we saw a good decline in the Q1, and we haven't stopped that, Lars, and you will see also that we will continue to push hard on it- That sounds- And wide cash flow also. That sounds great. That was all my time. Good. Thank you. Thank you so much. Thank you for the question. Yeah. Ulrik Bak. Yes. Hello, Jens. Ulrik. Just a question on your updated guidance. Yeah. So, the implied guidance on EBITDA for the second half of the year implies- Yes ... negative to flat EBITDA growth- Yeah year-over-year. And only positive growth potential in Borg and Fibertex Nonwovens. And this obviously stands quite in contrast to the development during the first half, where earnings have been quite a bit up. So I guess my question is, so can you just confirm that you are indeed seeing an overall softening of your demand across your businesses? We are seeing an overall softening demand, but, but also trying really to offset it. I think also if you, if you look at, at, at company by company, of course, the GPV really facing that most, others, most of them are trying to offset it. And then if you look at BioMar, that had a very, very strong first half. Also expect the BioMar to have good development in, in second half, but you also know biology, volume, a lot of things can play in here. But, but BioMar still with a strong profit uplift because of, of- mainly because of H1. But, but looking into still, a good comfort around BioMar. Okay. Yeah, and my second question on BioMar, this gross profit per kilo has been quite- Mm-hmm ...extraordinary over the past- Yes ... three quarters, and- Yeah ... and this quarter was up more than 30%. Yes ... year-over-year. And you have previously mentioned that it has been driven by improved supply and demand- Yeah ... particularly in Norway, lower- Yeah ... share of low-margin contracts, and then a positive impact from declining raw material prices. Yeah. Yeah. Can you say anything about the impact from the declining raw material prices, just to get a sense of what is a sustainable level going forward? Yeah, I think we are maybe now we don't expect the raw materials to decline much in the next quarters. But I think we are at a level where, because of our commercial excellence and our products mix added value and so on, we try to keep margins at the high level. Now we go into the very, very high season in Norway, where there will be more basic food as basic feed, sorry. You know, now they are really in the fast-growing process and so more standardized feed and so on. Of course, if things happens, more biological challenges and so on, we can see more functional feed being sold. But the budget now is based on business running smoothly, where more and more standard feed coming into the fish and so on. So that's what we base the guidance on, but still trying to keep a high margin level. Oh, understood. So did I understand you correctly, that you say that during the peak Q3 peak season, that there's more basic feeds being sold- Yeah ... which dilutes the margin? Yeah, it's diluting a little bit, but there is more basic feeds. And we have not taken into guidance that we should sell a lot of functional feed and so on. So that's one of the reasons behind that. And we don't do that. We're more say, "Okay, we expect a growing season, normal, and not with a lot of challenges," and so on. So that's the reason behind it. Okay. It's just, perhaps I'm a bit confused, but- Mm ... the GP per kilo is normally peaking in Q3. Mm ... which, I would think was because, you know, it, it's the more high-margin feeds that are being sold. Yeah. Now, of course, there's, it's not only high-margin feed, and you of course, you are touching on a very important point. It's also efficiency because we run a lot of volume, logistics, and so on, that really drives margin in in Q3. Because you have much more throughput in on the big factories and logistics and so on. And of course, also, I understand your question is saying, "Don't you see a larger or bigger uplift in BioMar guidance than you're coming with?" But when we are looking into things normalized as we speak, that's what we see. Understood. Then a question on GPV. Yeah. You mentioned some costs related to an ERP system. Yeah. Can you perhaps quantify how much the costs were in Q2, and for how long we will see this cost track- Yeah, they were- And what the potential benefit of it as well? Yeah. They were DKK 20 million for the quarter. So of course, it's quite a lot, and it's the startup of a new ERP that will benefit a lot over time because we can run products at different factories and things like... We need to have an ERP upgrade, and of course, there will come cost. And as you also know now, you take the cost immediately instead of having depreciations on them. So you will see a pick-up in that over the years. Maybe the startup cost DKK 20 million for the first quarter is high, but we will expect to see increasing IT costs over the coming year or years even. Yeah. Because it takes time to implement it. Okay. So there will be perhaps not DKK 20 million per quarter, but a bit less- Yeah ... per quarter for several quarters. Yeah, and it's also reflected. Yeah. Per year. Per year. Sorry, it was, it was DKK 7 million for the quarter, and it's DKK 20 million per year, so it's reflected into the guidance. Yeah. Understood. Yeah, to be 100% specific. Yes. Okay, that's great. Good. Thank you for the question from my side. Yeah. Thank you, Ulrik. Andre? Andre? Yes. Yes, good evening. I was just unmuting. Yeah. Just a few questions from my side as well. Yes. Just following up on Ulrik's question around the BioMar guidance, because I didn't fully get it. So just to be completely sure, why do you expect BioMar EBITDA to decline in the second half, year on year? Yeah, also, as I said... Sorry. Sorry, it's just there was some background noise. Yeah, sorry. That was my first question. As on... Repeat, why, why do the, expect EBITDA- Yeah ... in BioMar to decline in second half? Yeah, but as I, as I said, you cannot just take extrapolate over the year. A lot of things is going on. And also, how does the contracts look? That's something else also. You know, maybe they are in the main season, a little bit lower margins. Even I said that we are, of course, protecting our margins, so more standardized feed. A lot of things going on, and that's what we are seeing now. But if you ask me, and I think also I said that earlier on, that I feel good comfort on the guidance in BioMar. And And if we look compared to last year, even on lower volume, it's a significant profit uplift in BioMar. I think we need to be realistic also on how much we can drive, because it's also a balance which we are very, very into. It's a balance between volume and margin, and you can go over the cliff on too high margins, and all of a sudden you start to decline your volumes, and then efficiency starts to run off and so on. So that is, it's a balance. But you have just seen such a dramatic increase in EBITDA in the first half. I mean, do you have anything indicating currently also in the current trading that this shouldn't happen in the second half? Yeah, but as I'm saying, we expect lower volume Chile, lower volume, because of biology. A little lower volume in, in Norway, more standardized feed in, in Q3. As I also said, the contract changes a little bit when you get into the, main season. So, so a lot of small things is driving, the expectations as, as we see them now, and we have not taken into consideration that we, we should sell, a lot of functional feed, and so on. But volumes have also been declining in the first half, right? Yes, they have. That didn't stop... Yeah. That didn't stop the dramatic- No ... profitability increase. I agree. I agree. But, I can't say more on it than I've said. That, of course, we will work as hard as possible to push on margins and whatever we can. But what we see now is what we are saying, and without being too conservative, because, of course, we have an obligation also to guide as precisely as possible. And we have been through this in and out and discussed it lengthily, and this is what we are seeing now. Let's see when we get further on. But we feel good comfort with the guidance. Okay. And just, another question also around BioMar. Can you in any way quantify how much tailwind you got on EBITDA from lower raw materials in the first half? I can't quantify it, but, of course, we, we have had... We'll always have some tailwind when raw materials are declining. But again, we have also tailwind from... Not tailwind, but being very clever in optimizing, in doing innovation and things like that. So a lot of things has really really been the key driver. Also, something is also important, we have the country mix now. We have Norway with a very strong EBITDA margins, and luckily-wise, now good volumes in Norway. Ecuador also improved, so also depending on geographies and segments. Related to that, with how the raw materials are looking currently, do you expect to get tailwind in the second half as well from that on EBITDA? No, I think I said that- BioMar ...that now we have based the guidance and so on on normalized, or not normalized, but on raw material prices as they are. Okay. Thank you. That's all from my side. Thank you very much. Emil? Yes, thank you for taking my questions. Of course. Two questions from my side, and the first one also related to BioMar. So, you reported a decline of 9% in salmon volume compared to Q2 last year, which doesn't come as a surprise, as you're focused on building a more profitable contract portfolio- Yeah ... consequently saying no to some low-margin contracts. But can you elaborate a bit, and if possible, quantify on how much of this volume decline is due to non-renewed contracts versus a general decline in market volumes? I would say, probably 50/50. There were contracts we went out of, because, as you said, we were not satisfied with the profitability and outlook, and then there have been, biological challenges in particular in Chile, and then also, earlier harvest than expected in Norway. So really, not just to say something 50/50, but that's, that's really our, our clear opinion, that it's, it's in that area. All right. So the second question relates to GPV. So as mentioned in the presentation, the EMS industry is marked by subdued activity levels, and you do not expect any significant increase in demand to materialize before 2025. Mm. So are there any specific segments that stand out? Because we have seen among peers that demand in segments like defense and security- Yeah ... has been quite strong, which aren't segments where GPV, as of now, has the strongest presence. Yeah. Meanwhile, demand in segments like clean tech, construction, and communication as well has been more subdued. So does this align with your experience in terms of market demand? Yeah, to be really 100%, Emil. That's exactly as it is, to the point. And those in the defense segment, of course, they are having happy days and also looking forward to stronger years to come. And we are supplying all these segments that, for the time being, are a bit soft. Small, not that big in medical, but we are big into really industrials, heavy equipment and things like that. So we are sitting right there in the industrial segments that see soft market for the time being. All right. And, just a quick follow-up. As I recall, you have 2 out of the 17 factors in GPV that's currently approved for, let's say, military application. Yeah. Is that something you're looking into, scaling up in terms of, expanding the current capacity and into more, we could say, defense, security segments? Yeah, we have started to look into it, but it's not really something that we have been pushing hard on, because it takes a long, long time. We have places where, as you rightly say, that we are allowed to, or approved for producing for defense things. Some of our a factory, so we need to work a lot on, because, of course, a very attractive long-term segment that we want to look into. Perfect. That was all from me. Thank you. Thank you very much, Emil. Thank you. I think that concludes the Q&A session, so thank you very much for everyone. Jens, may I just have a- Sorry, Lars. Yes, of course. Just a follow-up, or were you just ignoring me? No, I didn't. Yeah. Not at all, Lars, sorry. No, that's okay. It's Claus, yeah. Yeah, I was also a bit, late to raise my hand again. Yeah. Come Yeah. Come on. GPV- Yes. Now, you are saying that your customer exposure is not that great in a downturn. But as I recall, in past calls, you have also, you know, mentioned a large number of your clients are more or less cyclical exposed. Yeah. So I'm a little bit confused now. That would be the first question. Yeah, of course, you're right on that. I'm just saying that we are also in segments that are very soft. We have segments that are attractive, also looking into IT and things like that. So we have a good mix, but some of our very big segments, they are more or less, all of them, maybe the perfect storm, that they see soft markets. We, as I also said, we see orders and demand picking up in some segments, so we have a good balance, Lars, but we have just been seeing also a lot of de-stocking going on. I think we need to take that into consideration also. All the big industrial companies around the world, like, have also these very polite questions from their analysts on the net working capital and things like that. So, it's something that has really been going on for some time. Okay. Yeah, these net working capital questions, you should answer those. Of course. Uh- Yeah. No, so if we are looking into a more, you know, difficult macro situation- Yeah ... would that be an opportunity for GPV from an M&A point of view? Yeah. Are you looking into the bank? How much money do you have to spend? Is there more incoming calls, et cetera, et cetera? Yeah, I think it's a very good, relevant question, Klaus. We are—as we said, we have strong ambitions for GPV. We also see this. Of course, you will see downturns, but in general, we have built a very strong number two position in Europe, interested in expanding it. We have people knocking at the door. Maybe price levels, valuations have not really adjusted itself yet, but we are still ambitious on building a GPV further up and creating a real large-scale company. So looking at opportunities, yes. That sounds good. That was all for me. Thank you very much, Lars. Okay, I think on that note, then. No, one more coming. Ah, good. Sindre, yes. Sindre. Hello, Sindre. Me now? Yeah, hi. Do you hear me? Do you hear me now, Jens? Yeah, we hear you. Yeah. hear you. Yeah. Yeah, thanks. Some problems with unmuting. Can I ask a question on BioMar? Yeah, could you do it in English, Sindre, even- Okay, yeah ... though you're a Norwegian brother, yes. Okay. On BioMar, I know there's been a lot of questions regarding what it seems like a somewhat conservative guidance in light of the very strong profits and margins in the first half. Yes. You've been focusing much on Norway. Yeah. Obviously, at this time of the year, it's uncertainties regarding biology as we enter the peak season. Exactly. In some summers, there's been a lot of biological problems. Yeah ... meaning that volumes have been less than, let's say, estimated prior to this season. But I would say, as of now, there are a lot of signs that biology actually is somewhat better than many pundits have expected. So, my question is, is your guidance for BioMar's second half, is that, let's say, if it comes like 8% volume growth year-on-year in Norway- Yeah ... versus, let's say, 1% year-on-year growth- Yes ... would that mean a lot of difference for you? Yeah, we have excess capacity, but not that much. So of course, we could maybe run even tighter on the lines and so on, better logistics. Of course, there could be some opportunities, but it's not a big thing. But still, yeah, could be- That's good ... an opportunity. And then, of course, it's excess volume, and then there, the margins, you have the cost always already in advance, so of course could be interesting. Yeah. Exactly, and wouldn't that also mean that the tighter market also should, let's say, give you a better bargaining position? Yeah, of course, it's always a situation. If things really happen, let's just say that the market was up 8%, that's quite a lot in volume. You also know all the figures and so on, compared to 1%. So of course, there could be some farmers that really would be in volume or in feed problems, couldn't get feed enough to grow the fish as fast as they expect. So could be opportunities, yeah. Okay, and then finally, could you just remind us how much of your volumes in, in the salmon division that is fixed on one-year or long-term contracts, as opposed to, let's say, more short-term duration on spot sales? Yeah, I would say in Norway, 60%-70% based on longer term contracts, whereas if you go to... Yeah, then you could say Scotland also, maybe 40% go to Chile. It's only year-based contracts, the same more or less in Tasmania. So Norway longer term contracts also UK, 50%-60% or in general, I think, something like that. But of course, you need to adjust prices. There'll be price negotiations and so on. You can have an opinion on we secure you x tons in volume, but we need to look into pricing quarterly based or something like that. Yeah, and that usually kind of cost escalation clause. Yes. Yeah. Yeah, okay, okay. Okay ... excellent. Good numbers. Thank you, Sindre. Thank you. Yeah. Okay. Okay, now, I think we can conclude the Q&A session is over. So thanks a lot to everyone listening and asking questions, so goodbye from Schouw & Co.