Good day, and welcome to the bioMérieux H1 2023 Financial Performance conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Aymeric Fichet. Please go ahead. Thanks a lot, Kelly. So hello, everyone. Good, good afternoon, good morning, and thank you for joining us to review bioMérieux's performance for this first half of 2023. I'm online with Pierre Boulud, CEO, and Guillaume Bouhours, CFO. Before handing the call over to Pierre for preliminary remarks, please note that this conference call will include forward-looking statements. I would like to remind you of the usual disclaimer saying that forward-looking statements are based entirely or partially on assessments or judgments that may change or be modified due to uncertainties and risks related to the company's environment. I also remind you that today's call is being recorded, and that a replay will be available on our website, www.biomerieux-finance.com. I will now hand the call over to Pierre Boulud, and then we will open the call to discussion and questions. Pierre? Thank you, Aymeric. Good morning, good afternoon, everybody. So, I'm Pierre. As you know, it was announced in June, I was appointed Chief Executive Officer as of the first of July. So it's first opportunity for me to share with you financial performance for the first half of 2023. And welcome to the call. So I'll start with sharing a few business highlights, and then Guillaume will hand over with more detailed financial performance updates. And I'll close the call with an update on PSR roadmap and confirm guidance. So moving on to key performance indicators, we are very glad to say that we display a strong commercial performance in the first half of 2023, as you could read, growing 8.3%. This 8.3%, we'll go into the detail, but, but, there is one element that I'd like to highlight, which is there is a 2% price increase, that shows capacity for the organization to translate some of the inflation costs that we have, to our customers. The second element I would like to highlight is a very strong performance excluding RP, because in the first half of the year, we've been able to grow our sales excluding the RP panel from BioFire, 11% in the first half of the year. Contribution and profitability reach, 16.5% sales tax, EUR 291 million. And as you know, very strong balance sheets with, very, very, very small debt, that is, showing the strength of the balance sheet of the company. So based on that, I will share with you for the major franchises and applications of bioMérieux, the commercial performance in the first half. So let me start with BioFire. So BioFire, as you can see, we've been growing in the first half, 8%. The first element that is driving this growth is, as you can read, non-respiratory panel, 27, amazing 27% growth in the first half of the year. Very much driven by the commercial efforts for the organization. We are leveraging the installed base that was created in the context of COVID, making sure that we have as many customers as possible using different panels beyond the respiratory panel. We are actually very satisfied on all panels, be it gastrointestinal, pneumonia, meningitis, they are all performing very well, and they are performing very well in all geographies. Very consistent, strong performance from non-RP. The other element, which I think is worth highlighting, is the 0% growth on RP, that obviously doesn't look very exciting. But as you know, the 2022 vanished in January 2023. We had a very limited COVID and very low flu season, mostly in the U.S. The fact that we've been able to keep our sales for the RP panel flat versus the first half of 2022 is actually demonstrating the medical value of syndromic respiratory testing using BioFire versus pure COVID or flu A, flu B kind of testing. So very, very impressive performance for RP, and we are very happy with that in the context of the very low flu season that we had. The third element I would like to highlight is beyond this good performance, we believe we still have room for further growth in the next few months. In the first half, we've kept growing our install base. As you can see, 800 instruments installed in H1. That will further feed the growth for reagents in the future. We still have, even though the sales of BioFire outside of the US are growing faster than in the US, it's still 75% for sales that are coming from the US, so significant opportunity for growth outside of the US. And finally, we still believe there is opportunity for further demonstrating cross-selling. We are growing, as you can see, moving from 70% to 74% of the customers using at least two panels, excluding points of care, obviously. But there is still room for growth there and for customers using more than two, three, four, five, until six panels, because we have the largest menu available. Next slide is about SPOTFIRE launch. It's a big element for H1. Obviously, it doesn't show too much yet into the financial numbers. However, it's big news for us in the first half. We are now live in the U.S. We got the regulatory approval in the first half. We have started the first shipment on June eighth. We have installed, in a month, 100 instruments. We also got good news in Japan in August, with also a positive approval from regulatory authorities in Japan that will allow us to start the commercialization in Japan in the second half of the year. So what we have today, just to remind everybody with Spotfire, we believe we have a very differentiated point of care solution. Fastest time to result, 15 minutes. Two panels, mini, which is 5 pathogens, which is already very good, and a broader panel, 15 plex. CLIA-waived, so that it can be used point of care, and we're obviously working on expanding the menu in the next few years. So that's the good news for Spotfire. If we move to the next slide, the other important franchise and highlight of the commercial performance in the first half is microbiology. We are very, I am very, proud of this performance. 15%, 15% growth in the first half of the year. It's obviously connected to all the effort that we are doing with regards to raising awareness against antibiotic resistance, making sure that diagnostics is used to reduce the use of antibiotics. It also comes together, and Guillaume will further expand on that, on a very good pricing power in microbiology that we've demonstrated in the first half of the year. And finally, it confirms, in my eyes, the very differentiated broad offerings that we have in microbiology. As you know, we are in the process of launching two systems, VITEK MS PRIME for fast identification, VITEK REVEAL, which is, the rebranding of the Specific Diagnostics product that we acquired, last year, that allows fast antibiogram, susceptibility testing. So, we have a very comprehensive offering that gives us a very strong impact in the market, and that is showing into a good sales traction in the first half of the year. Immunoassay, we are very much in line with expectations on immunoassays. Minus 2%, almost flat. As you know, it's a bit of a double-edged sword. On the one hand, we are losing on PCT, procalcitonin, where we've lost the exclusivity, so we are suffering on price and volume. This loss in sales is more or less compensated by the growth of the routine parameters, mostly in emerging countries. So very much in line with the expectations, the one balancing the other. The good news of the first half, and it's really early days, but the uptake is in line with the expectations. We're launching a new system on VIDAS, VIDAS Kube, very much driven towards developing countries, so that will support the growth for the routine parameters. On this system, the whole menu is available for the routine parameter, and it's in our minds and in our view, a very good way to support the sales performance for those routine parameters for the future. Moving forward, the other highlight of the first half is industrial application. Very strong performance at +9%. Again, good pricing performance, and again, Guillaume will further expand on that. Within industrial applications, as you know, we have two segments, healthcare and food. Healthcare has been very strongly driving the performance, with particularly a good performance in the cell engine therapy segment, which is a booming segment in the pharma industry, and where we have a very good offering in terms of quality control. So, we are benefiting from this very strong positioning. And that's pretty much what I wanted to share with you with regards to the commercial performance. I'll hand over to Guillaume, and obviously, we'll be able to answer your questions when we finish the presentation. So hello, everyone. Let's look at our financial performance. So on this slide, you have a recap of what Pierre has already explained by franchise or by technology, so I won't repeat, of course. Overall, just to comment on the as part of the 8% organic growth, Pierre mentioned price increases of 2% overall. We are glad and satisfied that in especially in microbiology, we were able to, let's say, deliver price increases of 4%. And in industrial applications, more than 5% of price increase. So definitely, pricing power in these areas, helping us to pass through some of the big inflation, of course, that we have on our cost base. Now on the geographical view of the sales. Overall, North America is positive and growing thanks to a non-respiratory performance as well as microbiology. A superb performance in Latin America. It's a small region for us overall, relatively, but very dynamic as you can read, plus 19%. Now turning to Europe, Middle East, Africa, overall, an excellent performance in Europe especially, double-digit growth in microbiology, which is really a performance in market that obviously are our major markets. Also very strong performance on the non-respiratory BioFire panels, so cross-selling on the installed base in Europe as well, and a very good performance of industry as well in Europe. This zone is only, let's say, suffering more from the, of course, Russia situation, where we still, let's say operate, but of course, it's getting more and more difficult with the different sanctions to deliver. Asia Pacific now, a bit less than 20% of group sales, a solid growth of plus 15%. As part of that, there's a, let's say, a non-recurring high growth in China, but very good in terms of recovery of our Chinese business, back to, let's say, normal levels, comparing to, of course, a low basis. You know that in H1 2022, China was very much in local lockdowns, which were impacting the ability of patients to go to hospitals. India is also on an excellent growth with a very good performance in this H1. Japan, which, you know, we conquered with the BioFire RP quite strongly in the past few years, of course, slowed down significantly, but just due to, of course, the COVID slowdown there. But we have good expectations, as Pierre mentioned, on entering with Spotfire in Japan. Now, turning to the P&L. So you have here 23 versus 22, and I'll comment mainly on the like for like change, which I can comment also on the acquisitions and scope effect. So the last column is a like for like. So as you can see, with 8% organic growth of the sales, we were able to deliver slightly more, 9% organic growth of the gross profit, meaning that we actually excluding scope and change, we increased gross margin by approximately half a percentage point. This is due to efficiency and the favorable evolution of the transport cost, which, as you know, in the market are decreasing, especially on the sea freight. Below gross profit, we have a pretty strong growth of the SG&A expenses. So in there, the first effect, as expected, is that we are comparing sales and marketing expenses to first half of 2022, which was still, at the time, impacted by COVID, restriction of travel, and the non-ability for us at that time to be as much with our customer and customer events as normal. So it's a normalization of sales and marketing activities, that we had already explained, that of course, comes with events and travel costs, but is absolutely necessary for us and our teams to speak to our customers about our products, our differentiated offerings, as well as our innovation. In terms of G&A in this line, one thing to mention is that we have a EUR 10 million impact from the MyShare employee shareholding program. So it's a program that we do every two years, which had a lot of success. We basically propose to bioMérieux employees to, in a sense of belong, to invest more in bioMérieux shares with a discount on the share. And, we had 5,600 employees out of 14,000 subscribed to this plan. But, about EUR 10 million impact in terms of expense for the company. Excluding this impact, the G&A grew by 6%, which is, let's say, a good performance. And as you can see, R&D is on a, let's say, normal trend of 5% and 12.8% of sales, similar to our usual kind of benchmark. Overall, with that, contributive operating income is almost stable at, on a like-for-like basis, minus 1.5%, which is very much in line with our full year guidance and fully in line with our expectations, our internal expectations. Just to mention that we have FX and scope impact. So FX is actually negative, about EUR 13 million, with the euro being in a more appreciation trend versus a lot of currency right now. In terms of scope, we have the integration of Specific Diagnostics acquisition, which was only in H1 last year for one month, and weighs for about EUR 11 million losses in the first half compared to last year. Now turning to below the contributive operating income. So we have this line of amortization of, let's say, the cost of acquisitions, that you know well, that has a very special effect, a non-recurring effect of an impairment, an impairment on Chinese entity Hybiome, for a bit more than EUR 60 million. So let me explain the context again. So just want to really emphasize that we have a major bioMérieux activity in China that is about ten times bigger than Hybiome. Hybiome is a small part of our China business. It's a company that we invested in five years ago. We have 67%, so not in full control with the minority shareholders. The company is in immunoassay, high throughput in China, which is a very competitive segment and probably became even more competitive throughout the COVID period. We realized in H1 that the recovery that could be expected post COVID was difficult for the company and was not performing in line with our expectations. As a consequence of let's say this performance and plans, we reviewed the valuation of the asset by a bit more than EUR 60 million in this time. We are also. I think it's important to mention that we're also considering let's say the possible strategic options for this participation in this Chinese entity. With that, other comments on the P&L below operating income. So we have a good improvement of the financial department, financial expense, which is moving from -6 to neutral. Of course, the macro environment... a return on our cash. Income tax, the -33% of effective tax rate is just impacted by this non-deductible impairment of the Ibioem entity. Apart from this one-off effect, we have an effective tax rate of 25.6%, very similar to our usual levels. And so we have a net income published which is down -29%. If you take out the Ibioem impairment, obviously a major one-off, as well as the FX effect and scope effect that I mentioned earlier, the net income would be down approximately 4%. Now turning to the cash flow generation. So EBITDA is slightly down in line with my explanations on the contributive operating income. Working capital is quite significant in terms of consumption. We have some seasonal effect there that can be expected, especially on receivables, which is a collection. We collect a lot in H1 from the sales of Q4, which you remember, with the triple-demic were super strong last year, Q4. We also have the seasonality payment of variable compensation bonuses usually around the March, April, so as usual. And on top of that, obviously, more than usual, we have a pretty strong increase in inventory that explains this cash negative on the working capital. Some elements to explain this inventory increase. First, we ended the year 2022 in, you remember, back order allocation, we say, for BioFire respiratory, so very low inventory. We took the first half to rebuild inventory for BioFire respiratory reagents, which of course, we definitely need to prepare the next winter season in a few maybe weeks now. The other effect that is important in the inventory is that we have a lot of new product platform launches right now, thanks to our innovation. And we definitely need to build up inventory for these instruments, for example, SpotFire, for example, VIDAS Cube, so that we can deliver customers with these ramp-ups. That being said, tax, no major comments. We had some one-offs last year that are not there this year. CapEx remains at, let's say, the usual bioMérieux level. For H1, it's 8% of sales, especially investing in Salt Lake City, so BioFire manufacturing and automation, as well as in China and the Suzhou plants. So overall, we have a free cash flow slightly down versus last year at EUR +1 million versus EUR +16 million. But the balance sheet that remains even after the payment of dividends, very solid, EUR 68 million of net debt. So really a lot of, let's say, headroom for investments as we need. The next slide is pretty technical, but it's to give the analysts and some investors a view on our foreign exchange exposure. So it's more a sensitivity of the conversion of bioMérieux, yeah, different currency exposure. You see also on this slide that the H1 foreign exchange effects were EUR 25 million on sales and 13 on EBIT negative. For the full year, we had said we expect EUR 40 million on the EBIT, which we confirm. The top line effect should be probably much stronger than that, around EUR 150 million, in the current possible estimates on sales. And with that, I hand over to Pierre. Yeah. Thank you, Guillaume. So, I'll share—I, I'll say a word on corporate social responsibility. We—two years ago, the company shared the roadmap and the ambition that we have with regards to six, sorry, five different pillars that we have on this ambition. So this is the update and of the different KPIs that we've communicated externally on the ambition that we have. I don't think I need to comment each and every one of them. Maybe I'll just highlight the greenhouse gas emissions. We have a very ambitious plan to reduce, in absolute terms, by 50%, by 2030. And as you can see, when we compare with 2019, with all the growth that was generated by the company and the very recent 8.3% growth in 2023, we still managed to reduce the emissions by 7%. So, a very solid performance, which, as you can imagine, doesn't happen by chance. So, a long way to go to reach the 50% that we have by 2030, but really moving in the right direction, so I'm very, very proud to share this with you. And the last slide that will probably be a good segue to the questions. We confirm with those results that, as you can see, a very solid first half of 2023. We guided on a growth excluding respiratory between 8%-10%. And what we see in the first half, and what we see coming in the second half, makes us very comfortable that we can confirm that. And the EBIT was guided between EUR 600 million-EUR 630 million, and more of the same, we are confident we can reach these targets. So basically today, with the communication of first half results, we confirm the guidance for the full year. And with this, I hand over to Katie. Yeah. We can open the Q&A session. Thank you. If you would like to ask a question, you may signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Once again, star one for questions. We'll go first to Maja Pataki with Kepler. Good afternoon, and thank you for taking my question. I have a few actually, and I'll just fire them at you. Guillaume, with regards to the pricing impact that you've had for the group, the 2% on group, but then the 5% in industrial and 4% in microbiology, could you remind me, please, when you started to increase prices and how long we should see the tailwind from a pricing perspective? That would be number one. Then just to clarify, the 100 instruments that you referred to for the SPOTFIRE, that's not included in the BIOFIRE, BIOFIRE 300 instruments, right? And then lastly, maybe if we look at H1 performance on the EBIT line, and then, you know, look at your guidance, look at the still significant impact from FX that you're expecting in the second half to come through, could you talk us through the layers that are going to be supportive of your margin improvement in the second half of the year? Thank you very much. Okay. Thank you, Maja. Thank you very much. Pricing impact, so when did we start to increase prices? It was, actually throughout, I'm sure- Exactly. But, mid and, maybe a bit earlier for industry, but mid, mid-2022 and second half 2022 for more, a bit further for clinics, so yeah. I confirm that the SPOTFIRE are not included in the +300 Q2 or +800 H1. It's on top, in terms of, install base. And then, the margins, again, we are very much, in line with the... For the margin for H2, it's, the same, let's say, trend as H1. The, what is changing is definitely the basis of comparison, 'cause, in H2 last year, we were already more, on a normal, let's say, sales and marketing, pace. Of course, there's the volume effect potentially that is stronger in H2 than in H1 traditionally. Right. But has there been anything specifically with regards to the product launches that you've introduced in June, like, you know, SPOTFIRE or the VITEK MS PRIME? Has there anything been that is more heavily that is more in H1 that shouldn't come through in H2 anymore, or is it just pretty much same business? No, in cost, I don't think there's a difference. Actually, it's not stopping. There's no one-off of product launches, and it's a cost that we need to add and events that we need to pursue. I would more say on the non-sales and marketing, typically the MyShare employee shareholding program was a EUR 10 million hit, that you understand, in H1, that of course, we typically don't have in H2, neither next year. 'Cause it's every- Understood. We do these type of programs every two years. Okay. And before I disappear back in the queue, could you please talk a bit about BioFire pricing? I mean, you've talked about group and everything, but, but how did prices develop on BioFire? Yes, I was expecting this one, of course. So BioFire, we are almost stable, very, very slightly down. Mainly due, only due, actually, to the fact that we decreased very slightly the prices on respiratory in the US, in front of customer requests that are looking at how they manage their portfolio. Not only in front of multiplex competition, but also the way they manage the testing, with also lowplex possibilities. So we adjust when needed. Yeah. When you say slightly, are we talking 2%-3%? Are we talking 5%? Yep. Or can you just- No, exactly, slightly means around 2%-3%. Okay. Thank you very much. US and RP part. Thank you. We'll go next to Uzma Noor with Morgan Stanley. Good afternoon, Pierre, Guillaume, and Aymeric. Thanks for taking the question. The first one was on SPOTFIRE. Which customer segments are you getting the most traction with? And are you able to disclose what proportion of your SPOTFIRE placements are from customers who already own a BIOFIRE FILMARRAY system? Just trying to get a sense of who your customers are. And then the second question was a clarification one. I didn't quite catch what you said around industrial sales being supported by the healthcare market. Did you mention the therapies involved in the pharma industry that was supporting this demand? If you could repeat that part of the comment, 'cause it wasn't in the press release. And then the third question was on the sales guidance for 2023 by segment. If I remember correctly, your guidance for microbiology for the full year was 8% and non-respiratory panels was fifteen percent. So you're clearly trending far above that for the first half. Is this just conservatism on your part, or do you expect these segments to slow or possibly decline in the second half? Thank you. Okay, thank you for your questions. I'll start answering, and Guillaume Bouhours will complement. Spotfire customer segment, so as you understand, my answer will be focused on the U.S. because it's too early to say for Japan. In the U.S., we are looking at not only the pure point of care segment, but also the IDNs and the labs where they're also using point of care systems, even though they are not in a point of care environment. And to answer your questions, it's too early to say where we have more traction, but we definitely get traction on both. We see a strong interest for the Spotfire solution in the very point of care setting. We are also seeing a significant level of interest from Integrated Delivery Networks that are interested in acquiring point-of-care solutions for their decentralized labs. So, again, a little bit early, and I hope that in the next few months, we will be able to give a little bit more color on that, but we're targeting those two segments, and those two segments are showing traction. To your second question, so sorry if I was not clear. So industrial applications, we have two segments, healthcare industry and food industry. What I was trying to say was that the healthcare industry was significantly more dynamic than the food industry in the first half of the year, especially from a volume perspective, because on both segments, we've actually done very good on pricing. Within the healthcare industry, the segment that is growing fastest is the cell engine therapy segment, where we're seeing a very good development of our sales for those specific clients. So I hope it's clear, otherwise, let me know. And finally, sales guidance. Guillaume- Yeah. You want to give it a first shot? Yeah, for short, and we can do it together. So on the sales guidance, yes, of course, you're very right. It's a very good question. You might see in the presentation that actually we tweaked very slightly the guidance by segment. You mentioned that non-RP, we are guiding around 15%. Now, you see that what we have written is above 15%. Microbiology was around 8%. Now we put a little sign above 8%, and same for industry. Which means that yes, we are ahead of our guidance, excluding RP, at H1, we are at the +11% for guidance 8-10. H2 yet will be a bit more difficult in the way that the basis of compare of H2 last year is higher than the basis of H1 due to the growth especially. So there's a normal effect of probably H2 percentage growth slightly lower than H1 percentage growth. Yet we see these segments a bit stronger potentially in terms of lending as compared to what we said six months ago. And of course that being said, for the overall guidance, it will depend a lot, and that's a big uncertainty on the respiratory season, winter season from September, October. But today we have no specific signs to know how strong or mild it could be. Yeah. I would maybe just add a qualitative comment on everything that Guillaume said. The fact that we have a very strong performance on non-respiratory products is to me actually a very strong signal of a capacity to generate good sales performance beyond what happens with the respiratory season. So as Guillaume was highlighting, we are entering months where our sales performance is very depending upon the magnitude of the respiratory season, especially in the U.S. What I think is important in the performance from H1 is that it's showing that we have growth pillars that are not depending upon the respiratory season, that are performing very well. So there is a level of uncertainty on the respiratory season that, I mean, it's still at a level of uncertainty that doesn't justify to review the guidance. And that's the only additional comment I would make. Understood. Thank you, that's very helpful. We'll take our next question from Odysseas Manesiotis, with Berenberg. Hi, thanks for taking my questions. Firstly, on SPOTFIRE, on these 100 placements, could you please share a rough portion of how many of these placements were new customers, and how many were existing BioFire customers? A second follow-up to that, what areas are you thinking to expand your menu here in the near term? And do you have any timelines at this point surrounding that? Last one, just to have a view of how to think on pricing, here on, is it around for industrial and microbiology that is, is a 1-2 price increase close to your average? And should we expect an above or in line with average price increase next year, given the current data you have at hand? Thank you. I'll start with Spotfire question, and I'll let Guillaume answer the other two questions. So, proportion of new customers, I don't have the exact number, but very clearly we are not targeting existing customers. As you know, we are entering the point of care segment, so the point of care clients, we had very few of them with the RTP solution, and we are very much targeting new customers. And when we are dealing with IDNs, integrated delivery network, it may well be that we have already sales and they are existing customers, but those clients, in most cases, don't use BioFire solution for frontline testing. So if we are selling Spotfire, especially the fiveplex, it would be additional sales to the same clients. So, I mean, I guess the underlying question behind your question is cannibalization effect and or cannibalization risk for those questions. At this stage, we see it as very limited, and it's definitely the commercial strategy that the Spotfire launch is an expansion of our business on the respiratory field. Second question, the menu, or you want me to say one? I mean, for obvious reasons, we don't disclose the menu plans and exact timing that we have. What we said, and that we keep saying is we are working actively. As you know, we are very efficient, productive, and competent R&D teams in Salt Lake City working on expanding the menu on BioFire. They are now working full speed on providing new panels for Spotfire. When we feel we can share the news, we'll share them, but for obvious reasons, we don't give more details at this stage. On pricing, back to your question, I'm not sure I fully understood, but I try to answer, you, you can correct. So the first part was kind of is the 2%, in line with our historical average? That's the way I understood. Our historical average is way below. In the past year, through Covid, we were at 0% price increase, and pre-Covid, I would say that we were up to 1%. So the 2% global is very significantly above what we are used to, which is normal, because it's very... Of course, it's in a very different environment of cost inflation. And you were asking about the pricing for next year. But first, we don't give the guidance for next year, and second, I think it's too early. There are, inflation is moving around. We see, typically, I mentioned transport costs are going down, which of course, is one direction. Yet salary inflation seems to be continuing to be potentially pretty strong. So we are right now working on how we set that for next year for our own teams, and that can be a driver on how we move on the external customer pricing. So probably to be rediscussed in due time, in the next three to six months. Mm-hmm. Thank you, yeah, Guillaume. I was thinking on the 1%-2% price increase, I was talking about just microbiology and the industrial, whether this 1%-2% is closer to what you do on an average year? So- Is that the right estimate? Yes. So yes, this year we are doing 4% on micro and 5-5.5% on industry H1. Yes, if you refer to the past, 1%-2% on these segments is probably the historical broad range. Yes. All clear. Thank you very much for the clear answers. Thank you. We'll go next to Louise Boyer with Stifel. Good afternoon, everyone. Thank you for taking my question. I have a couple, if I may. The first one concerns the BioFire install base. I was wondering if you had an indication on the utilization rate of the equipment at your clients. You mentioned cross-selling and so on, but I was wondering if you had some data on the installed utilization rate. The second one concerns the respiratory panel and to qualify the intensity of the flu season you've seen in Australia so far. What do you think of it? And the last one concerns the margin. Basically, you say that 16.5% is kind of a, not the normalization of the cost. If I add the 1.5% of margin linked to the employee share program, does that mean that a normalized margin for bioMérieux now is close to 18%? Okay, I'll start with, I'll start with the first question, BioFire install base and utilization rate. Actually, the way it works from a lab perspective is they dimension their install base on the peak demand. So they need to have the number of modules that allows them to address the needs when they are at the max of the need, right? Because they don't want to delay the result to the customer. So, utilization rate is not something we monitor on a regular basis, and usually when we have clients asking for new modules, it relates more to the peak use of the instrument than to the average use of the instrument. That would be my answer to your first question. Your second question was, flu season in the southern hemisphere. Very normal, average. We haven't seen anything special. By the way, it's not always a good proxy for what happened in the northern hemisphere afterwards. So we would love to have a model, and I'm sure I would be richer if we had the model to predict the flu season. We yeah we don't know is answer to your question, I guess. The third question was on the margin. So I was recalculating. I'm sure but your calculation for me, the EUR 10 million is about 0.5 in terms of margin, so that if we normalize that, which definitely can be done, it could be around 17% for the years where we don't do this employee shareholding program. All other things being equal. Yes, the 17%, definitely makes sense, and it's very much in line with our full year guidance, which is around this level. For the future, we, as you know, we don't give a target, apart from the fact that we will continue to improve, and this is a target. Okay. Thank you for those, those answers. I'm just adding one, if I may. Could you comment a bit, the current role of Alexandre Mérieux, now that he has taken a bit of a step back? How is he, implied in the strategy or, day-to-day life at bioMérieux? Okay. I can say a couple of words, probably a good question, more for him than for me, but we had the board actually earlier on this week. He was chairing the board as chairman of the board. He's, as you're saying, taking a step back from daily operations and the drive and the operations from the company, but very much aware of everything that is going on and very active and willing to help and support the company's development into his new role. So, as we shared during the communication, it's actually a pretty classical governance model, right? Where you have the president and the CEO, so we are... It's been two months, but so far we have been working very well together. And to be transparent with you, discussing almost on a weekly basis together on the company's performance and moving forward, what needs to be done. Perfect. Thank you very much. Thank you. Thank you. We'll go next to Peter Welford with Jefferies. Hi, thanks for taking my question. I've got four left, if I can, please. Firstly, just returning to microbiology, just on the VITEK MS and the WASPLab system placements. Just curious, if you can talk how much do you think of the strong demand you've seen during the first half of this year is due to, I guess, the lag effect from sort of COVID, if you like, and now labs returning, and equally, the sort of launch effect where some of the sort of first adopters want this system? So I guess what I'm really asking you is how much of this is sort of pent-up demand that you've placed during the first half of the year, do you think, for these systems, versus, on the other hand, a sort of sustainable installation rate- Mm-hmm. For these systems? Second, then, just on BioFire. Curious if you have any thoughts on, given the increasing awareness of RSV because of vaccines, the media, et cetera, do you think that potentially has a positive implication for both low and high plex systems because it's less just about flu? And I guess curious if you've had any questions or any requests about that, given that perhaps there's more awareness now that winter season isn't just flu disease. Third, then, just on gross margin, just thinking about first half versus second half, you've mentioned lower transport costs. Clearly, inflation is moderating. Are there any factors we should consider that make gross margin tougher in the second half versus the first half of the year? Because I'd imagine volumes are higher. You know, there's a lot of factors that would seem to suggest second half gross margin should be better. And then just finally on China, I wonder if you could talk about there some of the impacts from the the anti-corruption crackdown that we're seeing, both for the consumables, but also for instruments. Thank you. Okay, thank you, Peter. So, let's go one by one. The first one, microbiology dynamics. I mean, we could spend hours on this one. First of all, as you know, 75% of the business is driven by reagents. So, the dynamics of new installation, be it VITEK MS PRIME, automation system, like WASPLab, is not massively impacted. We are seeing good dynamics from an instrument perspective, but we're also seeing very good dynamic from a reagent perspective. There is a little bit, you're totally right, of a catch up post-COVID in terms of testing, which, to be honest with you, is heterogeneous by geography. For instance, it doesn't show in the U.S. We're seeing a little bit more in Europe. And the third element is we genuinely believe that beyond market uptake, we're taking share in the microbiology segment, in value and in volume, thanks to the very strong offering that we have. So, I mean, 15% is very good, right? I won't tell you that 15% is sustainable forever, but, but, it's definitely not solely driven by a bit of a catch-up post-COVID. The second question, RSV vaccine. Good question, actually, which is now available. I mean, our perspective is that it will strengthen awareness and actually make the testing for RSV even more relevant moving forward. We see it, by the way, with flu vaccine, flu testing. We see it with COVID vaccine, COVID testing. We see it with RSV. It's very relevant to be tested, even if and when there is a vaccine. And if any impact, I think it's a positive impact, because again, it increases awareness. But jury's out, right? Because the vaccine is getting available as we speak, so we'll see it, but that would be my take. Gross margin evolution. Gross margin H2 versus H1, there are—It's a good, a good question as well, of course, but there are factors in one way or, or another. And typically, for example, one way I mentioned transport costs, so they are, they are going down, so that should continue and, and probably have even more effect in H2 versus H1, a bit more. But we also have inflation of salaries, which, usually we, we increase the salaries around, April. We have only a quarter effect in H1 versus a full, full semester effect, in H2. There's a bit of volume effect. So all that to say that, there are some plus, there are some minus. All in, I mean, ballpark, I cannot, predict by, I don't know, point two or... But the ballpark, it should be relatively similar. And of course, I didn't mention, but there's a mix effect, which is a very strong impact. So depending on, again, BioFire, respiratory, you all know that, BioFire is amongst, not the only one, but amongst the top range relative to others in terms of gross margin. So of course, the mix effect can be strong, depending on especially respiratory, strong or a bit less strong, in H2. Yeah. Thank you, Guillaume. And, moving on to your fourth question with regards to China. And by the way, that will complement—I will complement my answer on the, microbiology underlying dynamics, because definitely China is one of these countries where we've seen a catch-up post-COVID from a microbiology perspective. We are seeing a very strong growth in microbiology in China, which is, which is clearly, based on the fact that 2022 was very low. We have, again, very competitive offering and we are by far the market leader in China in microbiology. But the performance, especially in Q2, is connected to the fact that Q2 last year was very low. With regards to the anti-bribery campaign, I think that the way, the way we see it, there are two, two kind of impacts. The first one is very short term, a little bit of a slowdown, because it generates a little bit of anxiety in the system. And maybe some purchasing processes are taking a little bit longer because we're seeing a little bit more caution and the willingness to document the purchasing process, which is perfectly fair, but it slows down the installation and purchasing processes. The positive element is in this market is that it will further reinforce the players that have very strong compliance constraints and guidelines. And as you can imagine, we have a very rigid and diligent processes. So, for the longer term, it's very good news for the Chinese market and for bioMérieux. We are very much supporting any initiative that goes in the direction of having a very fair and balanced purchasing process in the healthcare system in China, of course. I hope that answers your questions, Peter. Yes. That's great. Thank you. Thank you. Thank you. We'll go next to Delphine Lelouet with Société Générale. ... Yes, hello. Hi, good afternoon, everybody. Three left question, please. Can we have a bit of your feedback regarding the U.S. situation? Because we have quite of a slowdown there, which is nothing compared to the historical level of growth that we what we had. So we have a 3% growth organic in Q2. So any particular comments on any type of the business or any explanation would be very much useful. Back for a question for Guillaume regarding the depreciation of the goodwill, and how should we think, firstly, about the acquisition that you've been doing, and so, what sort of any change in the future or any lesson taken from this depreciation to keep in mind in the future? How should we think, of course, about H2, and especially if you consider to have a strategic review of I-Biome, so what's left in term of value, of I-Biome in, in, in the goodwill? And finally, but probably not for both of you, but I'm sure you talk about this at, at your latest board, regarding the dividend policy, and, and, how should we think about the dividend going forward? So can you give us any, any size on, on how should we think about an envelope? How should we think about the payouts, which was, boosted by the, post-COVID, let's say, 2022? So should we think about the normalization of the dividend level in, in the coming years? Thank you. It's all for me. Thank you, Delphine. So, I'll start with your first question on the U.S. situation. The evolution of the sales in the U.S. is very much impacted by the flu season. As you know, in the first half of 2022, and I think I shared before, the tripledemic basically vanished in January. And what was very strong Q4 demand in the U.S. transformed into a very low demand in Q1 and Q2. So, the rest of the performance is actually strong, be it microbiology, be it non-RP. I mentioned non-RP, the gastrointestinal panel is performing very well in the U.S. So we have relatively strong dynamics, actually, but that are a little bit to your point, when you are looking at the overall results impacted by the fact that the respiratory season was very low, and especially when you compare with 2022, where on top of that, you had the COVID-related sales. The other element to be comprehensive on my answer is we still have in the US, the impact of losing a little bit of procalcitonin sales. As you know, we have lost exclusivity. We are competing on price and throughput, so we are seeing PCT sales reducing, but very much as expected, so no bad news on this front. And respiratory season, as we highlighted a couple of times already, very much depending on, you know, epidemiology situation. The second question, Guillaume, was on the impairment of I-Biome and the view on the value. We review strategic options. At this stage, we believe that the valuation that we set for in our books is compatible with different strategic options. So, but let's see how it goes, what we decide and how it goes. There are still pretty significant book value, which is above EUR 100 million, actually EUR 130 million overall, in our books for I-Biome. And this is a value for 100%, as we have 67%, we have a full consolidation. Dividend policy, not discussed at the last board, because it's not the right time, but it will be discussed. Actually, the company, you, you've seen that we are now around the 20% payout. And we, I think the board, believes that it's a relevant level for bioMérieux, to, at the same time, let's say, have some return to the shareholders, as well as pursue, investments, in the company and the company growth. All right. Okay, thank you. We'll take our next question from Shubhangi Gupta with HSBC. Hello, thanks for taking my question. I just have one, please, regarding the situation in China. So many life sciences companies have flat softness in the China market, whereas, you have seen, like, good growth, in China. So could you please share, which business segments is this growth coming from? And also whether the pent-up demand has been absorbed, or there is still some potential in H2 for the pent-up demand? Thank you. So, what I understand is you're asking what are our perspective on the growth for China and where the growth is coming from. Is that right? Yeah. So- Go ahead. So, basically, most of our growth is coming from the microbiology franchise in China. This is by far the biggest segment that we have. The immunoassay segment, which is for bioMérieux China smaller, is suffering, by the way, along the lines that we're seeing I-Biome suffering. So, where we expect to grow in China for the future is mostly by consolidating our offering in microbiology. That's where we expect the market to grow. There is still significant untapped market opportunity in terms of use of instrument, in terms of use of diagnostics into grade two segments. So, yeah, a good momentum in H1, but in the context that I shared, which was we had a very low comparison basis from 2022, and good growth perspective in China on this very specific segment. I hope it answers your question. Yeah, thank you. Thank you. Thank you. We'll take a follow-up from Maja Pataki with Kepler. Yes. Hi, thanks for taking my follow-up question. Just more strategic question. We've seen in June, the new policy brief by the WHO on, you know, the agenda for antimicrobial resistance combat. And there seems to be, like, new CDC guidelines on how to deal with sepsis in hospital patients. In both, it's flagged that diagnostics has quite a significant part to play, and WHO brief actually looks specifically at syndromic testing and point-of-care testing. How shall we think about such a, you know, such a brief, such a guideline coming out and impacting the sales trajectory for your, for your company, if there is any impact to come at all? I mean, you know. No, it's a very good question. Thank you, Maya. It's, it's an excellent question actually. So first of all, I should say, this is, this is great news, and this is actually, I mean, I'd like to make two comments on it. The first one is, it's good news for the patients, that the role of diagnosis is, is more and more acknowledged and recognized in the, in the fight against antibiotics resistance and, and, and, and sepsis cases. It's, it's, I think it's good news for the patients, first of all. And two, it further confirms the relevance of the strategic positioning of bioMérieux and the investments we are making, be it R&D, be it, specific diagnosis last year, I mean, merger and acquisitions. It makes a lot of sense, and it shows that this antimicrobial stewardship, unmet medical need, antimicrobial resistance is going to be, for the next few years, a very important topic. We are totally convinced of that, and it's a very strong underlying market trend that we want to build on. Having said that, to your more kind of specific question, on what does it mean from a sales trajectory? I guess, I guess it's positive, but it's complicated to fully incorporate it into a projection. It's good news from a market perspective, but obviously it's on us to make sure that we take a fair market share from this growing need. It's, I guess, operational performance and complicated for me to give you a straight answer on what it means for our sales trajectory. Fully understood. But is it something that you take, you know, you take that, and you specifically go to your clients, and you start talking about processes? Does that, does that give you some firing power in your discussions, or is it just... And, you know, nice to have, it's, it, it confirms our trends. I guess that's more the question. Yeah. Okay, got you. So no, it's, I mean, it's the former and not the latter. We definitely use it. It's, I mean, when we are talking about WHO, it's, as you know, it's important, especially in developing countries, where the need for growing awareness on antibiotic resistance is very important. So it's definitely something that we use. For you to know, we're also working with corporations like Fleming Fund, NGOs, that drive actually installations of microbiology solutions or diagnostic solutions into emerging countries. They fund them. So we also work with NGOs so that they can support this, which is not only, I mean, from a pure business perspective, helpful, but it's also an excellent way to build reference center in those countries, further spread the value of diagnostic in those countries, and further expand beyond that. So we have. This is definitely something that we use, possibly, I mean, we definitely need to work on maximizing the value of it, but it's something that we try to leverage as much as we can. Great. And the level of acceptance- Can I just quick- ... of WHO guidelines is important actually in many countries. Okay, great. And Guillaume, just quickly a follow-up for you. I've been going back to my notes, when it came to the Specific Diagnostics acquisition, and back then, you guys were guiding for a negative EUR 10 million impact on EBIT in 2022 and EUR 15 million in 2023. Now, last year we were, I think, with EUR 14 million above that guidance. How shall we think about the headwinds from Specific this year? Are we, you know, are the 15 still valid, so the H2 impact, you know, yeah, any thought around that will be great. Yes, of course. Absolutely right. Definitely, we mentioned -15 for this year. And I think, definitely with about EUR 11 million loss in H1, we should be more around 20, probably between 20 and 25 in terms of impact this year, that we feel we can absorb overall. We took that into account. When we say we confirm the guidance, it means we have, we are processing internally to take into account all the plus and minus. This is a minus. The reason also for the slightly heavier losses is that, the FDA approval and therefore launch in the U.S. has been slightly delayed, obviously by probably 1 or 2 quarters. And the ramp up in Europe is going well, but it's proving a bit slower in terms of converting customers from sales evaluation to actual sales and actual ramp up, a bit slower than expected, which is often the case in our field for, let's say, hospitals and doctors to change their habits and get innovation on board. But do you still confirm the break-even timing of 2025, or is that also pushed out? Yeah, I think at this stage we should, we should still target for that. Okay, good. Thank you very much. Thank you. As a reminder, star one, if you would like to ask a question. We'll go next to- So we- Christophe Ginet. I'm sorry, go ahead. No, no, we'll take Christophe, and after we'll take maybe questions from the chat, a few. Understood. We'll take Christophe Ginet with Oddo. Yeah. Good afternoon. Can you hear me correctly? Yes. Yeah. Good afternoon, everyone. Thank you for taking my questions, actually three. Sorry, I couldn't get connected earlier, so maybe I will re-ask, but let me check a few points. First, what you said about China and the growth prospect, can you be more precise in your vision of this figures when talking about the future growth? Do you think that it could maintain at the previous level in, I mean, in terms of pre-COVID pace of growth? So can you elaborate a bit more? The second one is on price on pricing power. Do you think that we should expect the same pace of price going forward, given the inertia, given the pace of tenders and so on? And last question is about your comments on the new platforms. You talked about a good start, a good pent-up. Is it possible, regarding Kube, VITEK MS, Spotfire, Reveal, and so on, is it possible to provide some figures or more qualitative details about this good start, please? Okay, maybe I'll start with China. Give you a handle on pricing power. So China, it's a combination, maybe three answers to your question. The first one is, you can definitely not extrapolate H1 to the rest because, and probably you missed it, but H1 2022 was extremely low for us. I mean, overall, huh? Because, especially Shanghai was in full lockdown, the whole country was blocked. So we have a performance in Q2, particularly, but overall in H1, which is very good, very positive, which is showing a very strong recovery. You cannot extrapolate. Moving forward, the dynamics around performance in microbiology are very good and very strong. We are seeing, and back to Maya's point earlier, very strong level of awareness, WHO impact, an increased use for diagnostics, especially in the field of antibiotic resistance. That is supporting obviously our business. The adverse effect is we're also seeing the immunoassays business more and more Chinese more and more in the hands of large Chinese player, and where we are struggling more and more to compete. So we have those two dynamics moving forward for China. The second question- So- Sorry. Yeah. Sorry, go ahead. I understand, but can you put on this the pace of growth going forward? Sorry, you got cut. What do we do? Sorry, would you put figures on those trajectories? No, we don't, we don't give projections. Maybe back pricing power. Pricing power, so we, we discussed already, but, no problem to rehearse, on the... I mean, of course, for 2024, it depends overall on the cost inflation environment. Some, some topics are slowing down or even getting better, like the, the transport costs, typically that we already see. So that's something to take into account. Some others are, are continuing to, to grow at a pretty strong pace, typically the, the overall, salary, inflation or salary increases, still, we see today, to be seen in the coming months, is we, we will have discussions as still a pretty, solid dynamic for next year. So I'm talking on the cost side, because of course, this is what will drive, can drive justification to our customers for price increases and our ability to pass through, some of those. Yeah. So again, we are at also budget discussion and have to take into account the microenvironment, which we'll probably have more clarity to give in the next three, six months on this. New platform and some figures. Yeah, you want to? Yeah, I don't know what kind of numbers we share. I can give you a blend of qualitative comments and numbers. VITEK MS PRIME, we are, which is the first new system that we launched, is progressing very well. We have the numbers I have is we have more than 250 systems already installed and active. Qualitatively, we have a very positive feedback from the market versus competition. We are taking share, and we have a high demand. I would say we have a good problem with VITEK MS PRIME, which is the demand is probably higher than our capacity to deliver as we speak. So we are working actively with supplier, and also, we are actually having our own teams going to the supplier to help and support the teams from the supplier. The success is so good that we're also looking at internalizing the manufacturing of these instruments. As you know, the model for bioMérieux is more to manufacture ourselves the system. It was not the case for this one. So given the success, we are going to accelerate the internalization. So, very good dynamics and if there is one point of attention, it's capacity to actually install and deliver at the pace that the customers want. VIDAS Cube, very early days. We've launched in 16 countries. As I said, as I said, it's more dedicated towards developing countries. As we speak, we have already shipped in the region of 150 instruments, which is significant. They are not all yet installed. We're in the process of installing them. But again, very strong traction and hopefully a good opportunity to make sure that we have good dynamics with regards to reagent consumption on VIDAS. Okay. We take a few questions that we have on the chat. I think you have one also for those. First one was a bit technical. The reason for the minority interest down in our P&L to move from EUR 1.8 million to EUR 22-EUR 23 million in H1. The reason is that we own 67% of Ibiome, so we do a full consolidation at 100%, meaning that when we take the impairment, we take the full value of the impairment, 100% of the impaired value in the line amortization of acquired intangibles. And we take the 33% of minority share of this impairment in the line minority interest, which obviously is this 20+ million. I can take the second one. SPOTFIRE during the summer. Summer, and are we able to sell some of them? So we, we are—I mean, we talked about the 100 installations on Spotfire, but we have a very busy pipeline of opportunities that are being discussed with the, with the clients. So that we are building since June eighth, which... So we are already building the pipeline of commercial opportunities, not only for the end of 2023, but already for 2024. Are we able to sell some of them? That's that allows me to make a comment on a previous question, which was segments of customers. Because as I said, we are not only targeting the pure point of care setting, we are also targeting integrated distribution networks that are interested in Spotfire for their decentralized settings. The point of care segment is purely a placement segment. You don't sell instrument there, so you have to place the instrument and then make your money on the reagents. The benefit of targeting also the IDNs is that they don't always systematically ask for placement. They also, in some cases, prefer to buy. So it means that we have some capital sales in this segment that allow us to sell, to your question. The other benefit of this segment is, for obvious reasons, they see more patients, so the use of reagents in this setting is also better. So that's the reason why it's a segment that we are definitely looking at carefully and targeting as much as the pure point of care segment. Complementary to that, was the question on the Spotfire unit cost for the customer. So again, it's not-- I'm not giving you a list price, but just a ballpark. We're talking about around EUR 25,000 or- Dollar. Or dollars for control station and module. And maybe to stay on the SPOTFIRE, an update on the commercial agreement of the distribution of, of SPOTFIRE. We are in discussion with distributors. The commercial agreements are not finalized, but we are in active discussions. In the same way, we are seeing a high level of interest from the customers. We're also seeing a high level of interest from distributors, especially in the U.S. Work in progress. There was a question that I think we answered already on Specific Diagnostics, referring to Maya's question earlier and the impact in 2023. There's another question on the level of normalized operating margin that we shared earlier. We could see normalized in H1 at around 17%, and again, it's fully aligned with our guidance for the full year. And back to this question, yes, of course, we have a volume effect or—and mixed effect. If BioFire respiratory is super strong, it should be an upside, and if it's super weak, it should be a downside. Obviously, yes. Fortunately, yeah, fortunately and unfortunately, depending on how it goes. That's it for the- Yeah Questions online. Of course, the presentation will be online on our way. Right after the call. Right after the call, in a few minutes. there any other questions online? I mean, voice. There are no additional questions in queue at this time. Okay. So thank you very much. Thank you, everybody. I'm looking forward to, Meet some of you. to meet some of you in the next interactions. Yeah. Thank you. Thanks. Thank you. Bye-bye. Bye-bye. That will conclude today's call. We appreciate your participation.