Good day, ladies and gentlemen, welcome to Imerys's Half Year 2022 Results Conference Call. At this time, all participants are in listen-only mode. I would now like to hand the conference over to the CEO, Alessandro Dazza. Please go ahead. Thank you. Good evening to all of you. Thank you for joining us today, as usual, to review Imerys 2023 first half results. With me today, Sébastien Rouge, our CFO, and as always, let me start by sharing with you a few key messages for the semester and for the quarter. Imerys posted a very resilient performance in the first six months of the year, achieving sales of EUR 2 billion, approximately, current EBITDA margin of nearly 17%, and even 18.3% in the Q1, and net current free operating cash flow of EUR 135 million before strategic CapEx, significantly ahead of last year. Sebastien will walk you through the financials in more details in just a few moments. I would say that this is quite an achievement, given the record high comparatives of last year. I remind you, Q2 was probably the best in the history of the company, an overall challenging context we are operating in. Continued customer destocking, macroeconomic weakness in key end markets, and I will come back on these topics a bit later. Once again, Imerys demonstrated what we can do well, cost management, cost discipline, positive price-cost balance, which are definitely core strength of the group. Pricing, important, holding well, as you can see on the bottom right of this page. Let me now walk you through a few of the key events of the Q1, 2023. First, we made significant progress on our lithium projects. At the end of June, you're aware, we announced the creation of a joint venture with British Lithium, with the objective of creating the United Kingdom's first integrated producer of battery-grade lithium carbonate. Imerys contributes its lithium mineral resources, land, and infrastructure for an 80% share in the JV. British Lithium brings its bespoke lithium processing technology, IPs, technical team, and a very nice pilot plant for the remaining 20% in the JV. We have assessed a lithium deposit containing 160 million tons of inferred resources at 0.54% lithium oxide content, indicating a life of mine potentially exceeding 30 years, based on the capacity of the plant we would like or we plan to build. We target an annual production of 20,000 tons per year of lithium carbonate equivalent, enough to equip the equivalent of 500,000 cars every year. This, by the end of the decade. This announcement came just a few weeks before the decision of the Tata Group. I don't know if you are aware, recently announced, owner of Jaguar Land Rover, to build a gigafactory for batteries in the UK. That will be a major boost for the economy, but also for the British car industry, very close to our future operations. The combination of this, as well as EMILI, that you know better, would make Imerys the largest integrated lithium producer in Europe by the end of the decade, representing more than 20% of the announced European lithium output by 2030. If we now look on the, on the right, on the EMILI side, on, on the, on our French project, another step was achieved with the completion of the scoping studies for EMILI, confirming its economic viability. Basically, the pre-feasibility study, which is the next technical step, has been launched and is underway, as long as the permitting process for the construction of the pilot plant. We have also filed and applied to the, what we call, CNDP, la Commission nationale du débat public, which is a necessary step to hold a public consultation, which will probably take place sometimes in the first half of next year. Quite important or very important, I would say, we produced a laboratory scale, the first battery-grade lithium hydroxide from the French granite. Imerys technology and process are validated by these encouraging results, and for me, pave the way for the next steps in this key project. If we now, on the next page, look at our strategic CapEx program and innovation roadmap, I would say two important elements. We commissioned, in the month of April/May, the 3rd production line of carbon black at our Willebroek site in Belgium. We target at least EUR 60 to 70 million sales, once at capacity. 4th line, I remind you, is under construction, on time and on budget, and should be completed by mid of next year. We're also accelerating our investments in research and development in this field. We just installed a new carbon black R&D reactor, which commissioning should come really in the next days. Very important to develop the next generation of conductive additives for batteries. I think also worth noting that we entered a cooperation agreement with the MIT of Boston to develop the next generation of carbon blacks for batteries, leveraging the capabilities offered by this brand new innovative reactor. Not only we invest in research and development and on CapEx, we also progress on our decarbonization roadmap. We signed a long-term contract with E.ON, I guess everybody knows E.ON, a big producer of electricity and distributor of electricity in Germany, to build an energy recovery plant on our Belgium site at Willebroek. We will use part of the energy, the large majority of the energy produced by this unit will be supplied to the local grid in Belgium, to satisfy the equivalent of approximately the consumption of 40,000 households. The installation of this energy recovery represents definitely a major step forward for a more sustainable carbon black, first of all, and secondly, also will help to reduce CO2 emissions on site by more than 70%, or more than 90,000 tons per year. A second important project in Lompoc, in California, we partnered with TotalEnergies to install a very large solar panel and energy storage systems. The unit will cover at least 50% of the site's current electrical needs with renewable energy, and reduce our CO2 emission by at least 7,000 tons per year. Let's now look at our end markets. Let's start with construction. As you know, it's the most important for the group, representing around 40% of our sales. Markets continue to slow down, both in Europe and North America, maybe less so in other parts of the world. The drop in the US is the fourth consecutive quarters, and I find it particularly impressive. High interest rates, lower activity levels, continue to have a negative impact on the sector and, of course, on our business. The Asian construction market was helped by a slight improvement in confidence, reopening of China, to be seen if confirmed. On the bottom part of the slide, private consumption or consumer goods remain sustained in all geographies, especially in China, with large reserves of household savings being released now. US is expected to remain robust, thanks to a resilient job market. We are a bit less confident for Europe, where we fear a recession on the back of persistent inflation or more persistent inflation. Automotive, on the next page, definitely one of the few bright spots in terms of end markets in the quarter. Good rebounds, of course, starting from a lower level, and probably we are still below 2019 levels, so pre-crisis level, so still margin for improvement, but definitely, good order intake and good development. Even China, with new subsidies being announced, is expected to rebound significantly. As the second part of this slide shows, in general, in the world of energy and renewable energy, so lithium-ion batteries, we do see the market after a dip in Q1, returning to solid, healthy growth, maybe a bit less on electronics, post-COVID. In the last page on markets, maybe the least positive news, industrial production, impacted differently depending on the geographies, certainly on a negative trend for the US and for Europe, where Imerys is more present. Better in Asia, especially in India. China, yes, improving, I would say less than markets had expected, a few months ago. Paper production, as our notes, continue to decrease on the back of very high inventories. Iron and steel also hit, typically as a consequence of construction and low industrial activity, especially in Europe, I would say due to as I said, the general slowdown of economic activity and construction business. I will now hand over to Sébastien for a more detailed analysis on our financials. Thank you, Alessandro. Good evening, everyone. Let's go through some of the key aspects of our financial performance in the first half. Sales reached EUR 2 billion, a 7.4% decrease compared to H1 last year, which was a high comparison basis. You remember the Q1, in particular, of 2022, was one of the best in the history of Imerys. The decline was mostly driven by a EUR 271 million volume decrease, corresponding to a drop of almost 13%. On a like for like basis, revenue is down only 5.6%, thanks to a positive price effect of EUR 152 million. Prices are still up more than 7% as compared to the same period last year. Revenue also includes a slightly negative currency effect of EUR 13 million. This mainly reflects the depreciation of US dollar against the euro. I remind that because this impact will increase in H2 if exchange rates remain at current levels. If we now look into more details at our two business segments and their respective markets, we start with Performance Minerals. This segment generates 67% of the group's turnover, with global sales reaching EUR 1.3 billion in the first half of this year. Overall, the activity levels were low across all geographies, with like-for-like revenue down 8.7% in Q2, which was a very high comparison basis. If we look at the applications, ceramics and paper-related markets continued to be impacted by destocking and mill downtimes. This was only partly compensated by the rebound of the automotive market. On the half year, sales drop is limited to 2.5% on an organic basis. EBITDA decreased to EUR 215 million, and its decrease is mostly linked with volume shortfall and an unfavorable business mix effect. We have to remember that also for margin, H1 last year was at peak levels for Performance Minerals. Looking now at our High Temperature Materials & Solutions, sales of our second business segment totaled EUR 648 million in H1, representing 33% of Imerys' consolidated revenue. In H1, the decrease of 12.2% of this business segment, like-for-like, stemmed from lower revenue from the construction sector, simultaneously in Europe, in the US, and even in China to a lesser extent. Only the Indian market remained robust. The lower level of profitability for this segment is suffering from lower sales and production volumes, especially due to continued destocking and low activity in refractory and abrasive sectors. We go now to the group's profitability as a whole, the current EBITDA for H1 reached EUR 331 million, down 11.8% year-on-year. This evolution is a combination of several factors. The first one is the strong price effect contribution for EUR 149 million, which more than compensated for the EUR 70 million net increase in variable fixed costs and overhead. This is the consequence of the carryover of price increase in 2022. We can note a slowdown of the variable cost increase in Q2 versus Q1. It was EUR 50 million, it's EUR 18 million in Q2. We anticipate this trend will continue in Q3, taking into account the benefit, in particular, of lower European energy prices and lower transportation costs. We can note as well, that in spite of labor and service inflation, fixed costs and overhead are in absolute value at 2022 levels, reflecting savings actions that have been implemented. These savings and these actions will carry on during the second half of the year. Finally, we benefited from the contribution of dividends from JV and Associates, reported on this graph in the last variance column. This explains why this variance is positive EUR 17 million, in spite of inventory reduction efforts. As a result, current EBITDA margin is resilient at 16.7%, above the level that we saw in H2 2022, which was 16.1%. If we look now at the other elements of our income statement, in absolute terms, the current operating income variance is better than the one of EBITDA, thanks to the positive development of non-cash item, in particular, depreciation, and also, again, the contribution of joint venture, which is higher on the P&L than the dividend that we received. The current operating income just reached EUR 218 million at 11% of sales. The net financial result was negative at EUR 26 million, slightly above last year levels because of FX variations. The current net income from continuing operation just decreased by 7.1% to EUR 139 million. Other operating income and expense were negative at EUR 38 million, related to the disposal and the reorganization activities. All in all, net income was at EUR 145 million, versus EUR 192 million last year. Let's now look at the cash flow generation. We reported a current free operating cash flow of EUR 96 million, with a small improvement of the operating working capital. We start to see the first impact of a normalization of inflation, which penalized us a lot in 2022. The EUR 11 million decrease in operating working cap compared to December last year, is the result, in particular, of tight management of our inventories and receivables. This free operating free cash flow figure include EUR 178 million in paid capital expenditures. Out of them, we have EUR 39 million of strategic CapEx. This strategic expenditure include the end of our Jade project, the Performance Minerals plant, which has been commissioned in China, and the line 3 and 4 in Willebroek, and the Lithium EMILI project, as reminded by Alessandro just earlier on. You remember that we have deliberately increased our gross CapEx spend as part of our capital allocation strategy. How do these different elements translate into Imerys' balance sheet? Even after the exceptional dividend payment of EUR 330 million, we have de-leveraged the company and reinforced the balance sheet. At the end of June, the ratio of net financial debt to current EBITDA decreased as compared to December, reaching 1.7 x. In absolute terms, the net financial debt decreased significantly to EUR 1.2 billion. On this good note about Imerys' sound financial structure, I now hand over to Alessandro for the outlook. Thank you, Sebastian, and let me wrap up with one last slide. The way we see the next, the next few months or quarters. First of all, very little visibility into customer demand, and on the, in general, on the macroeconomic, macroeconomic environment. The latest news that appear in the press are not very optimistic, so we assume that the next two quarters, the activity will not improve significantly, but also not degrade significantly. If that's the case, what the group shall do, and has proven in the past that being able to do, is, first of all, to focus on costs. Cost savings, cost reductions, programs that we have launched, and that will deliver in the second half. You have seen our, on the variance, bridges, the impact of fixed cost and overheads in a year where inflation is double digit. We basically managed in H1 to keep these costs under control at 0 variation compared to last year, therefore compensating entirely the inflation. I think we can do even better. We do expect savings on variable costs, especially on logistics, transportation, partly on energy, that will deliver in the second half. We expect pricing to remain stable, which in such a deflationary environment will be a good achievement. Therefore, all of this will guarantee stable, good profitability of, in the second part of the year, although historically, the second part of the year is a weaker half, considering the month of August and the month of December. Summarizing in this context, I would say we expect to achieve a current EBITDA between EUR 630 and 650 million for the full year 2023, of course, assuming that no big disruptions in the second half happens, under current perimeter, which still includes the Paper assets. We will focus on cash flow. We have launched programs to reduce our working capital through better performance of our plants, shorter lead times, and we believe there will be strong cash generation also in the second half of the year. Finally, on a more, on a mid, long-term perspective, we do maintain our midterm objectives, as announced last year at the Capital Markets Day. We are convinced they remain achievable, thanks to our ongoing actions to improve profitability, cash generation, thanks to our geographic footprint and very diversified market exposure, good end markets, and especially our ambitious program in strategic CapEx that will start to deliver in the coming quarters. Thank you, and now open to your questions. Ladies and gentlemen, we now begin the question and answer session. If you wish to ask a question, please press star one, one on your telephone and wait for your name to be announced. We are now taking the first question. The first question from Sven Edelfelt from Oddo BHF. Please go ahead. Your line is open. Yes, good afternoon, gentlemen. Good afternoon, Alessandro, Sebastian, team. I would have a couple of question from my side. I noticed a EUR 36 million cost from expenses linked to disposal or reorganization, presumably this is linked to the carve-out of a Paper business. Can you confirm that this EUR 36 million is a one-off, there will not be additional cost in H2? Could you be a bit more specific about when the Paper business will be sold? Clarification on pricing, you mentioned pricing to be stable, that means H2 versus H2, one should expect pricing to be flat. Is that the way we should look at it? A third one, I go back in the queue. I think there has been some article mentioning that you offer to buy the 20% of British Lithium that you do not own. Can you maybe elaborate on that? Thank you for your answers. Thank you. Although I let Sebastien explain the EUR 36 million. Yes, please. It's the main two elements are actually an incremental impairment related to the Paper assets. Highlighting actually the latest status where we are in terms of final negotiation. I will let Alessandro finish maybe on the negotiation itself. Obviously, if we have, it's non-cash, first of all. Non-recurrent. Obviously non-recurrent, and that's our best view as of today, of what shall happen when the transaction occurs. I take this opportunity to remind everybody that there will be also non-cash impact when we dispose of Paper, that we are disclosing in the accounts of the translation reserves that will be recycled to PNL for large amounts, but that will neither impact cash nor the equity of the company, just an accounting entry. The second big portion of the EUR 38 million is actually a reorganization, small or medium reorganization of some manufacturing assets in China, where we have decided, as we do once upon a time, to combine some operations together, then to announce the closure of one plant in China not losing the market, but combining our manufacturing assets in this area. Thank you, Sebastian. A short update on our Paper assets divestiture. It continues. It was, we knew, a complicated carve-out because of multi-geography, small plans. I remain confident it will be soon, August, so not for sure, not now. I hope it will be Q3, but if not, it should be within the end of the year, is definitely a reasonable, is a reasonable assumption. Ongoing, really. In terms of pricing, when we mention stable, is more current pricing remaining stable through the end of the year, without releasing much of it. Energy prices are slowly coming to pre-crisis level, pre-energy crisis level. Logistic is coming to pre-crisis level. Therefore, most of the surcharges have already been returned to customers, as per agreement. What's left are real price increases needed to cover fixed costs and other increases. I believe if we can manage to keep current pricing into H2 stable, it would be a great effort, and we will see it bottom line. Your last question is when on British Lithium, I have no idea the source of these rumors, but I can tell you there is no truth behind it. We are very happy to join forces. British Lithium brings very important aspects to this joint venture, the knowledge, 5 years of work on the deposit, on the technology, a pilot plans, and a very entrepreneurial spirit, and a bit of English touch in the project. I believe it's a very valuable partner, and today there is really. It's really a pleasure to be together. It's working well, and I count in developing this project as rapidly as EMILI in France. Thank you. Thank you for your question. We are now taking the next question. Please stand by. The next question from Aron Ceccarelli from Berenberg. Please go ahead. Your line is open. Hello. Hi, good evening. Thanks for taking my questions. I have one on your guidance. Maybe can you explain, if I take the midpoint of your 630 to 650, that implies that the second half should be down 10% yearly. It was down 3% in Q1, and now is down 18% in Q2. Maybe can you help me understand a little bit, what are your assumption for the second half of the year in terms of, in terms of cost, probably, and also pricing? The second one is on synthetic graphite and carbon black. As we know, you are investing big time here. I would like to understand a little bit if there's any capacity pre-sold at this time in synthetic graphite and carbon black. Anything you can discuss would be helpful. The last one is on working capital. It's nice to see some working capital release now. Would be great to understand, Carlo, how you think about that going forward for the remainder of the year. Thank you. Alessandro? While Sebastien looks at the figures and will answer to you in synthetic graphite and carbon black, I am not sure pre-sold if it's the right word. What we have announced when we invested in the third and in the fourth lines of carbon black, as well as in the second expansion in synthetic graphite, all these 3 latest investments are largely covered by take-or-pay agreements with our key customers. Therefore, for me, as you say, pre-sold, yes. We did not commit the entire capacity. We do want to have some freedom to serve other customers, but the bulk of the business is secured mid to long term, really with top-tier customers and guarantee of take. Sebastien, do you want to take? The way we built H2, I would say, is well in line with Alessandro, what Alessandro has said. We intend to still suffer from volumes, that's for sure. The comparable will be easier, but in absolute value, we do not expect a large improvement. We will, and it was explained, I would say, to a certain extent, give back a little bit of price, what is actually related to energy and freight, and keep the rest. We will, and we are clearly banking and we are securing a cost decrease on the variable side. Two comments I could do on that. You have in mind, freight and energy are the two biggest external variable costs that we have. We have the habit of contracting on a 12-months basis, our freight contracts. They typically are June to June type of contract, and we are actually secure the significant decrease of freight costs that will kick in in the second half of the year. You have in mind, the freight represented last year, more than EUR 600 million at the peak of 2022 costs. Energy, same thing. I think we have discussed that in prior calls. We have a habit of hedging energy costs. During a big portion of last year, we did not hedge in order not to freeze costs at a very high level. Since the beginning of 2023, we are back in a position to hedge. We have therefore secured way cheaper energy price, both gas and electricity in Europe, in H2 as compared to H1. When we blend all these factors, that's roughly what we show. A little bit of uncertainty of the volume, positive certainty of the input costs. Question mark, and I would say a market-driven decision on the pricing, that's where we see H2 slightly lower than H1 in the worst case. I may add, Adrian, purely math, as you said, if you take the middle or, let's say, the middle of our guidance, it would mean a second half at EUR 310, EUR 320 million for EBITDA for the second half, which compared to the first half, is very close, EUR 330, which would be a significant improvement compared to last year, where the second half was, around EUR 30 million below, first half. I remind you that second half has August and December, I believe it means a significant improvement in, in performance. Sebastian, you want to comment on working capital? We are not very vocal about, you know, guidance and target on working capital. I would probably stress 2 main factors anyhow. First of all, a mechanical factor. We suffered a lot collectively, we were not the only one, of inflation last year, which has increased working cap. I would say this inflation mostly is over, so at least it will not increase further. Receivable inventory will be at equivalent volumes at the same level of last year. Our volumes are decreasing, and obviously we are working mostly on the inventory side at adjusting. Honestly, our target is to keep on decreasing the working cap. I will not give a specific figure, but we have seen the really inflation points in this first half of the year, and we expect that to continue again, both by mechanical value factor, by the impact of volume, and by the impact of the work that we are doing throughout the organization. There has been, you know, a raise during 2021 and 2022 to pile up inventory of every person on the planet, because logistics was scarce. I would say now we are back to normal and back to readjusting our inventory levels in particular. That's helpful. Thank you. Thank you for your question. We don't have any other question at the moment, but if you wish to ask a question, please press star one, one on your telephone. We are now taking the next question. The next question from Mourad Lahmidi for BNP. Please go ahead. Your line is open. Yes, good evening, gentlemen. Most of my questions have been answered. I have one left. In 2022, I think that the paper-related businesses accounted for 9% of your sales. Has this share remained stable in H1, or was there any big difference compared to that? Thank you very much. Hello, M ourad. I see if Sebastian can find the proper number. Your assumption for last year is correct. It was around 9% to 10% of the business. Proportionally, this year, 2023, the paper business, as you saw in the analysis of markets, suffered the most. Definitely is the biggest drop in volumes that the group saw in 2023 is for the paper market. Therefore mathematically, the percentage on overall group sales is dropping, mathematically. Definitely. Do we know? We're still in the 9% range overall. Okay. It loses one point, but it's the market that has suffered the most. Okay. After an extremely strong 2021 in the paper world, with very high prices for our customers, everybody's been producing. I would say the consumption of paper has not changed significantly, other than the natural trend that we all know. The extremely high inventories have a significant, or they had a significant impact on the first part of the year. This market suffered more than any other. If we had to take out the EBITDA contribution of paper from your guidance of EUR 630 to 650 million, what would be this guidance? We said that it's pretty much aligned. It was a business of around EUR 400 million, and it's pretty much aligned with the group EBITDA. That's what we always communicated. If you do the math, you can easily get to what could be a quarter or a few months of EBITDA. Okay. Thank you very much. The business itself is, from a profitability point of view, aligned to the group. It's simply the declining profile that is, needs to be addressed on a regular basis. Thank you for your question. There are no further question at the moment. I will hand the conference back to management for closing remarks. Thank you. First, I would like here to thank Vincent Gouley, who's been our Investor Relations Vice President for a long time, and I know that all of you on the phone know him by now, and if you don't, you have not done your job properly. He's not leaving the group, but he's moving to a new task, and he will join the EMILI team to develop this fantastic project we have. Congratulations! British Lithium as well, sorry, in the lithium world. He will be substituted by Thierry Laranjeira, who some of you might have met already, and if not, he will be the one accompanying me and us in the future. He's been for many years in the group, so he knows inside out our activities, our markets, our customers, and our structure. The second point is to thank you all for this call, and wish you probably a good summer. Thank you very much. Thank you. That concludes the conference for today.