Hello, and welcome to the Intertek 2022 Half Year Results. My name is Jess, and I'll be your coordinator for today's event. For the duration of the call, your lines will be on listen only. However, there will be the opportunity to ask questions. This can be done by pressing star one on your telephone keypad to register your question at any time. If at any point you require assistance, please press star zero and you'll be connected to an operator. I will now hand over to your host, André Lacroix, to begin today's call. Thank you. Good morning to you all, and thanks for joining us on our call. I have with me Jonathan Timmis, our CFO, and Denis Moreau, our VP of Investor Relations. There are 5 takeaways in our today's presentation. The first takeaway is that the group delivered a robust financial performance in H1, notwithstanding the impact of lockdown restrictions in China. We delivered at constant currency a revenue growth of 9.5%, like-for-like revenue growth of 4.9%, an EPS growth of 6.7%, a robust free cash flow and an excellent ROIC. Outside of China, the group delivered a like-for-like revenue growth of 7.1%, one of the best like-for-like performance for many years at Intertek, a double-digit operating profit growth, and importantly, a 20 basis point margin accretion. The second takeaway is our business in Shanghai has been operating as normal from July 1st as expected, and we expect our China business to deliver good like-for-like revenue growth in H2. The third takeaway is our acquisitions are performing extremely well in revenue and margin. We are really proud of having SAI and GLA in our portfolio, two major acquisitions in high-growth, high-margin segments. This morning, we've announced an agreement to acquire CEA, a market-leading independent provider of quality assurance in a very exciting, fast-growing solar energy sector. As we all know, solar energy is the future for the world of energy. The fourth takeaway is for the full year, we are targeting robust like-for-like revenue growth at constant rates, and given the impact of the lockdown restriction in China in H1, the expected divisional mix and the investment in growth we are making, we expect margins to be slightly below 2021. Our disciplined cost management remains of course in place, and we'll continue to leverage our strong pricing power to manage the high unexpected inflation in several markets where we are investing in capability. Net-net, we expect the group to deliver at constant rate a robust earnings growth in 2022. The fifth takeaway, really important for the future of the company, the TIC quality assurance market is growing faster post-COVID. The expectations of all stakeholders in quality, safety and sustainability are much higher, and this is great news for our TIC portfolio. Let's start with our performance highlights. The robust financial performance of the group in H1 I just discussed demonstrates indeed the strength of a high-quality growth business model. In the first six months, we delivered a revenue of GBP 1.5 billion, 9.5% up year-on-year constant rate, as I said, and 13% actual rate. Our group operating margin was resilient at 14.6%. Our earnings growth was 6.7% at constant rate and 10.6% at actual rate. Our free cash flow, of course, at GBP 96 million was robust. We've announced the interim dividend in line with what we paid in the last three years, and our ROIC was excellent at 16.8%, with organic ROIC 21.4%, 20 basis points higher than last year. Of course, our balance sheets remain super strong. We've delivered a broad-based mid-single digit like-for-like revenue growth of 4.9%, product up 4.3%, trade up 5.7%, and resources up 6.7%. Our robust like-for-like revenue growth was driven by progress, both on volume and price. You've heard me talk about it for many, many years. We believe in good like-for-like revenue growth, getting both volume, price, and the benefit of mix. Outside of China, we benefited from an acceleration of demand for ATIC solutions with a like-for-like growth of at least 7% in each of our divisions. A performance that Intertek has not delivered for quite a while. I'm really proud of this like-for-like performance given the acceleration of demand for our solutions in the market. Of course, we are pleased to see the acceleration in terms of like-for-like revenue momentum in the May-June period for our trade and resource businesses. In H1, we saw a margin reduction of 70 basis points at the group level, driven solely by the impact of the COVID-19 restriction in China. Outside of China, we delivered a good margin performance with a margin accretion of 20 basis points. We benefited from a strong pricing power as we executed the price increase we had planned to take in the first half and of course, as we remain very disciplined on our cost management. I'll now hand over to Jonathan Timmis to discuss our H1 results in more detail. Thank you, André. In summary, in H1 2022, the group delivered strong revenue with a robust EPS growth. Total revenue growth was 9.5% at constant currency and 13.2% at actual rates as beneficial movements in FX rates impacted our revenue by 370 basis points, driven by the weakening of sterling. Like-for-like revenue grew 4.9% at constant rates. Operating profit at constant rates was up 4% to GBP 217 million, delivering a margin of 14.6%, down year-on-year by 70 basis points. Diluted earnings per share were GBP 0.865, growth of 6.7% at constant rates, and 10.6% at actual rates. I will now take you through the high level operating margin performance by division. Products performance was impacted by lockdown restrictions between March and June in our China business, especially in Shanghai, which represents 25% of our China business. Margins were 19.3%, which adversely impacted the group by 110 basis points. Trade operating margin grew to 7.6% and contributed a 20 basis points increase to the group margin. While a decline in operating margin in resources to 4.7% had no year-on-year effect at group level. Finally, our recent acquisitions had a positive 10 basis points impact on group margin. The group delivered adjusted free cash flow of GBP 95.8 million, down year-on-year by GBP 26.8 million. The good increase in operating profit was offset by an increase in working capital. In half one, 2022, we invested GBP 41 million in CapEx in line with prior year. We finished half one, 2022 with financial net debt of GBP 859 million, which is up year-on-year due to the acquisition of SAI and represents a financial net debt to adjusted EBITDA ratio of 1.3 x. We have a robust financing structure in place. We have a good average debt maturity of 4.5 years with an even spread of maturities. 83% of our debt is at fixed interest rates with an average rate of 2.7%. Now, turning to our financial guidance for 2022. We expect net finance cost to be in the range of GBP 34 million-GBP 38 million. We expect our effective tax rate to be between 26.5%-27%. Our minority interest to be between GBP 20 million-GBP 22 million, and CapEx investment to be in the range of GBP 125 million-GBP 135 million. Our financial net debt guidance, excluding future changes in FX rates or M&A, is updated to GBP 730 million-GBP 780 million as a result of the weakening pound against our predominantly U.S. denominated debt. I will now hand back to André. Thank you, Jonathan. Let's now discuss the performance of our business lines, starting with our products business. All comments I will make, as usual in this section, are at constant currency. In H1, our product business delivered a robust performance. Our revenue benefited from the high demand for ATIC solutions and of course from the acquisition that we have made recently, enabling us to deliver a revenue growth of 11.5%. For the period, like-for-like revenue growth of 4.3% globally. Outside of China, we delivered a like-for-like revenue growth of 7%, driven by double-digit growth in Softlines and Business Assurance, two of our star businesses, high single-digit growth in Food, mid-single-digit growth in Building & Construction as well as Chemical & Pharma. Low single-digit growth in Hardlines, Electrical, and Transportation Technology. Our margin in H1 was 19.3%, down 170 basis points due to the impact of the lockdown restrictions in China, of course. In 2022, we expect our product divisions to deliver robust like-for-like revenue growth. Moving to trade, following a good 2021, driven by the rebound of global trade, our trade division benefited from a growth acceleration enabling us to deliver a good margin accretion. The high demand for energy and agri products drove like-for-like revenue growth of 5.7% globally and 7.2% outside of China. Operating margin of 7.6% was up 90 basis points. In 2022, we expect our trade divisions to deliver robust like-for-like revenue growth. Just a few remarks regarding the conflict in Ukraine. Our exposure to Russia and Ukraine is small, less than 1% of the group revenue. The war, however, will continue to impact the global energy supply chain and the global food supply. Russia, as we know, is a major producer of oil and gas, and export activities represent around 7% of the world's consumption. Following the sanctions implemented, we expect to see the following changes in the global energy market. The amount of oil and gas exported from Russia into Europe will reduce, of course. The amount of oil and gas exported from Russia into Asia will increase, and we are already seeing it. The overall amount of oil and gas exported by Russia will reduce over time. The production of oil and gas in the U.S. and Europe will of course increase. The amount of LNG imported into Europe will increase, and importantly, investments in renewables in Europe will accelerate. For Intertek, the change in energy trade flows as well as increased investments in renewables will be a net positive for Caleb Brett and Industry Services operations. The war is also impacting the global food market as the conflict has disrupted, we know that so well, the trade flows in the Black Sea in several categories, grains, oil seeds, vegetables, and fertilizers. In the short term, these disruptions are increasing pressure on price. Over time, these will be offset by an increase in production from major exporters like the EU, Argentina, Canada, U.S., and Morocco. This trade flow change will be a net positive for AgriWorld operation. In the resource sector, we've seen a high demand for ATIC solutions. There is no question our clients are benefiting from the global recovery in oil and gas as well as minerals that enable us to deliver 6.4% like-for-like revenue growth globally and 7.4% outside of China. Operating margin was slightly below last year, reflecting our investment in growth in Australia. In 2022, we expect our resource business to deliver robust like-for-like revenue growth. Let's now discuss the outlook for 2022. The lockdown restrictions have had a significant impact in our China business between March and June, and Shanghai was the most impacted region, and as I said earlier, is now back to normal. We have an excellent business in China with leading and scale position and very strong margin across all of our businesses. In H2, we expect our business to deliver good like-for-like revenue growth like we saw pre the restriction period. Globally, we are seeing an increase in demand for ethics solutions in product, trade, and resources. Our like-for-like revenue growth outside of China was 7.1%, enabling us to deliver double-digit operating profit growth and a margin accretion of 20 basis points, as I mentioned earlier. In 2022, we expect robust like-for-like revenue growth at the group level with robust like-for-like revenue growth in product, trade, and resources. We continue to leverage our strong pricing power, especially in the markets where we're investing in capability to seize these extra growth opportunities and where we are facing higher than expected inflation. Our disciplined cost management will remain in place to continue to drive productivity improvements. Given the impact of China in H1, the expected divisional mix, and the investment in growth we are making, our margin at constant currency will be slightly below 2021. For your margin model, I just want to remind you that the group benefited in 2021 from additional government subsidies in the orders of GBP 10.5 million, as we disclosed at the end of the year, with 1/3 in H1 and 2/3 in H2. A brief update on currency. The average sterling rate since the beginning of the year applied to the full year results of 2021 would provide an uplift between 400 basis points and 600 basis points at the revenue and earnings level. Net-net, we expect the group to deliver a robust earnings performance in H2 and for the full year at constant rate. Let's now move beyond 2022 and talk about the exciting growth outlook for Intertek. You heard me say that before, but let me just share my main insight. COVID-19 has been much more than a tragedy for the world. It will be remembered as the greatest dislocation of the global supply chain since the seventies, creating significant imbalances between supply and demand in raw materials, components, goods, service, and manpower, resulting in higher than expected inflation across many markets. In the post-COVID world, stakeholder expectations in quality, safety, and sustainability are higher than ever, making the case for risk-based quality assurance stronger than ever. The TIC demand will grow faster in the post-COVID world, and let me explain why. Of course, we operate in a highly attractive industry with strong structural ATIC growth drivers that we know so well, that they deliver great performance for all stakeholders in this industry and will continue to deliver GDP plus like-for-like revenue growth in real terms. Based on our market research, and as you know, we do about 6,000-7,000 interviews a month with our customers with our NPS survey. These attractive structural ATIC growth drivers will be augmented by an increase in new clients, higher investment in safer supply, high investment in innovation, a step change in sustainability, and higher growth in the world of energy. Let me talk about these five accelerators one at a time. We are seeing a significant growth in a number of companies globally, given the ease of regulations to create new businesses, the low barriers to entry for any brand with e-commerce capabilities, an increased level of talent to develop new technology, new products and new services. The lack of quality assurance expertise of these young companies is great news for Intertek. Our decentralized customer-first organization has a strong track record, indeed, of winning new clients. I don't know if you're aware of that, but on the 2nd of November 2021, at the Cotswold Airport here in the home market in the UK, we had the first flight powered by sustainable fuels. Ready from a molecule development standpoint, safety and sustainability. This is the type of companies we partner with very early on at the early stage of their R&D work, and of course, they achieved a Guinness World Record. We are very proud of being partnered with Zero Petroleum, run by the fantastic CEO, very famous in the Formula One world, Paddy Lowe. Second growth accelerator, increased investment in safer supplies. COVID-19 is proving a catalyst for many corporations to improve the resilience of their supply chains. We expect major corrective actions inside companies. Better data on what's happening in all parts of the supply chain, tighter risk management with razor-sharp business continuity planning, a more diversified portfolio of tier one, tier two, tier three suppliers, a more diversified portfolio of factories, investment in processes, technology training and independent assurance. We are really well-positioned to help our clients reduce the intrinsic risk in their operations given our superior assurance offering. You know that we are a leader in terms of ethics offering, and you've seen the tremendous growth of our Business Assurance business in the first half. Let me tell you a recent development with one of our major clients, and we cannot name our clients if they don't let us do for obviously confidential and commercial sensitivity reasons. A few months ago, I got a call from the head of supply chain at one of the major global luxury cosmetic headquarters in North America. They were facing some real difficulties with quality and recalls in their supply chain in China. They called Intertek to basically not go and check what's happening in China. They also wanted us to do that, but they called us to basically do an end-to-end audit of their quality assurance management systems throughout their operation. This is a fantastic company with a tremendous track record, but they've realized that they had intrinsic risk in their supply chain they were not dealing with from a systemic standpoint. That's the type of assurance work we do for our clients. Let's move to innovations. Our clients have realized that they need to invest more in product and service innovations to meet the changing needs of their customers. As you would expect, during a measurable crisis like COVID-19, consumers' expectations are changing given the desire to live in a much fairer world. A recent survey by Gartner showed that 60% of the R&D leaders expect to increase their R&D spend in 2022. This investment in innovation will result in a higher number of SKUs and a higher number of test-based SKUs, which will be, of course, beneficial for our product divisions. We got tons of examples of clients coming to us to basically get our subject matter expertise early on at their R&D stage to develop their new products and solutions. The other major area of investment inside corporations is, of course, sustainability. Indeed, we are seeing a positive momentum for sustainability with emerging regulation in addition to what has been put in place in the last few years. Companies will have to reinvent the way they manage a sustainability agenda with a greater emphasis on independently verified ESG disclosures. This is an excellent development for industry-leading solutions in assurance. I'm not sure if you've seen the recent development that has happened at the EU. As the CEO of Intertek, I'm part of the TIC Council, which is our global, you know, trade association, and I chair the Global Sustainability Advocacy Group that basically work with regulators around the world to get higher sustainability reporting standards. We just achieved a major win, which is an amendment to the 2014 Non-Financial Reporting Directive in the EU, with basically a Corporate Sustainability Reporting Directive that will get into effect from 2024, 2025 and 2024, that basically will force companies to have independent audited sustainability reports. The big win is that we have secured that our industry will be part of the certified companies that can audit these reports. That's a major win, and you can imagine we had a bit of competition for the big four, but we won. Let's talk about the fifth growth accelerators, and I'm super energized about the opportunities there. These are the growth opportunities in the world of energy, which are truly exciting. A lot of commentary has been available in the press, so our insights will not be a surprise to you. Let's try to bring these key insights in a few succinct points to our discussion here. To meet the expected increase in global energy demand, the world needs a significant increase in energy production. There's been underinvestment in traditional oil and gas exploration and production in the last decade, and we know that renewables are great but not scale. Therefore, investment for production in traditional oil and gas and renewables will increase significantly. There is no question that the investment and technology required to build renewable infrastructure is very, very challenging from an IP standpoint and of course funding standpoint. There will be a divergence between the energy mix in developed and developing countries. In developing economies, we'll see growth in oil and gas trade flows and infrastructure investments. The diversified energy mix in developing economies will increase the complexity and risk in a just-in-time energy value chain. We've seen quite a lot of examples of grids not being properly operational in the U.S. or here in the U.K. Watch this space. This is just the beginning of a new big risk, which is energy supply 24/7. To achieve net zero, we expect a major acceleration in both technology and investment to create scale carbon capture and storage infrastructure. The world will not get to net zero unless there is big progress in terms of technology and investment to basically capture carbon wherever the carbon is being emitted. The growth acceleration in the world of energy I just described is fantastic news for Caleb Brett, Industry Services, Electrical, and Business Assurance. You've seen this morning the announcement we made in the solar energy segment, a very, very exciting space for us. When you step back and you look at, you know, the ATIC structural growth drivers, the track record of the company, and these growth accelerators, I have to say we are extremely well positioned to seize the growth acceleration in our end market for many years to come. Our science-based customer excellence USP gives us excellent client relationship and a strong pricing power. We have a powerful portfolio with scale position in attractive growth segments. Our high-quality component earnings model deliver sustainable value, as you know. We are very agile with our disciplined performance management on price, cost, and cash. Importantly, we invest in organic and inorganic growth with discipline. Investments are essential to remain the best in terms of customer service and to deliver superior ATIC solutions. Our teams are very focused on scaling up the winning innovations we've launched in the market over the last few years, as well as developing the next big ideas for the industry. We're also scaling up our M&A investment successfully as evidenced by our excellent ROIC. We continue to look at new opportunities to invest in high-growth, high-margin sectors. This morning, we've announced a significant move in the solar energy sector with a leader in the space. Moving forward, we'll continue to deliver sustainable growth and value for all of our stakeholders. Our science-based customer excellence USP is giving our clients the ATIC advantage that they need to strengthen their business. We operate a high margin, capital light, carbon light, and a highly cash generative earnings model. As you know, our approach to value creation is based on the compounding effect year after year of margin, equity, profit growth, strong cash generation, and disciplined investment in growth. That approach has delivered 13% annual TSR in the last decade, a tremendous performance. Moreover, our earnings model has strong intrinsic defensive characteristics. It's important to note that the assurance solutions we offer are mission-critical for our clients to make sure that their operations continue to operate safely. We operate a highly diversified set of revenue streams, offering a broad range of ATIC solutions in 70 industries in more than 100 countries, working with slightly more than 400,000 companies around the world. Given our superior customer service, we have strong and lasting relationships with our clients. In summary, we are a high-quality growth business with strong defensive characteristics, creating value in good and challenging times. We are purpose-led, offering ATIC solutions that are mission-critical for the world. We operate a high-performance earnings and cash compound model, and importantly, the growth in our end market is accelerating. We are extremely well-positioned to continue to create sustainable value for all. Before I close, I would like to thank all of my colleagues at Intertek for the incredible commitment, passion, innovation, agility and energy given Intertek a science-based customer excellence advantage in the global quality assurance industry. Thank you for your attention, and we'll take any question you might have. If you would like to ask a question, please press star one on your telephone keypad. Please note your line is unmuted locally as you will be advised when to ask your question. Once again, that's star one if you would like to ask a question. The first question comes from the line of Kate Carpenter from Bank of America. Please go ahead. Hi, everyone. Thanks for taking my questions today. Morning. A few from me. How much did pricing contribute to results this half, and how do you expect that to evolve through the remainder of the year? Similarly, any details that you can give around kind of where you're seeing wage inflation at this point would be very helpful. On the investments that you're making that you expect to impact margins this year, could you just give a bit more color around that? Which kind of specific divisions and operations and how long you expect that to kind of take before you see that translate through to higher revenue? I'll leave it there. Yeah, thanks. Look, I'll try to address the three points in one, you know, explanation. If you go back, right, in times, the way we decide to operate in 2020 when COVID-19 became a global issue, we basically made the assumption that COVID-19 was gonna be a temporary disruption in the global supply chain of our clients. That was a big decision we made, and therefore, because we are an IP-based company in terms of customer service, our PhD scientists, engineers are really the science-based customer excellence advantage I was just talking about. We made a decision to not restructure company and lower cost base like many, many corporations did. What it did, it basically kept a lot of slack in terms of capacity in 2020 in the business, obviously impacted the margin, but we believe it was the right thing to do. As the global economy recovered in 2021, we were very well positioned to deliver, as you remember, another industry-leading margin for 2021 because we didn't have to hire people back. We had the capability available. We could be, you know, nimble. We can be very fast with our clients. As a matter of fact, I mentioned that in previous calls. All of our NPS calls have dramatically increased in 2021 because we had this availability of IP at the fingertip when our clients really needed it. Of course, we were operating in 2021 below the 2019 level. As we moved into 2022, we start having businesses, and this is the third question, where we are ahead of 2019 in terms of demand and revenue. As you know, we are a people-based business. When you basically, you know, need to build capability, you need to hire, train, and make sure people are fit for the customer service you want to deliver. We are a very technical business. The reason why, you know, we are talking about investments, you know, being impacted by inflation is because where we need to hire additional capacity, and it's essentially in most of our product line businesses that are ahead of, you know, 2019 and in our minerals business in Australia. Of course, the cost of doing business has increased in the meantime. As we recruit, we have to pay higher obviously dollars to recruit these colleagues. That's what basically is creating a bit of inflation on our cost base. Now, if you go back in time and if you look at Intertek performance for the last, you know, many years, you will see that we are always able to grow our revenues slightly faster than our cost, delivering margin accretion. If you look at 2021, obviously, in the first half, you will see that, you know, for the first time, given what I've just explained, you know, our cost is growing 1% faster than our revenue. Now, there is no question in that the China impact is having effect here because we kept our capability in China and obviously we had less revenues. The point, you know, is that this is our business. We are people, science-based business. When there is demand, you need to build the capability. We are investing in that. It's costing slightly more. Now, the way we deal with wage inflation, you know, we have a very disciplined approach. We basically believe in long-lasting customer relationship. We basically pass 50% of the wage increase through inflation, and the rest is being offset through productivity. If you look at H1, what happened, essentially, you know, our actual organic growth was, you know, 2/3 volume, 1/3 price. The inflation in these markets where we have to invest in capability, and these are essentially, you know them well, U.S., Canada, U.K., Europe and Australia, is higher than we expected. As we see, you know, more demand, we invest to build the capability and we're gonna take additional prices in addition to the price increase we took in the first half to basically offset that, and it will take time, you know, to normalize. Look, I'm not worried. I mean, we are in a great position. We have higher demand than we were expecting, and therefore we need to hire. I'm just giving you an example right here in the UK, we run a very leading edge pharma business. Which is the leading expertise worldwide in terms of drugs being delivered through nasal devices, right? The amount of research that is happening in the nasal devices to give molecules that will make us healthier is incredible. I'm here to tell you that we believe in the industry that not in 2023, but in 2024, COVID-19 vaccine might be delivered through nasal spray. We are working on that. Now, our clients come to us with initial orders, and we say, "You know what? This is the right thing to do. We're gonna have a big impact in society. Let's hire, train, and make sure that we got the people to deliver capability." Look, this is the business we're in. What's different this time around is the fact that the inflation is higher than expected in more markets than typically we operate. We've always had to deal with that in certain markets, but as you know, inflation is a big concern. That's what's happening. I'm not worried. I would be worried if, you know, we had inflations and lower demand. We have higher demand and inflation to deal with. We've got pricing power. The strong lasting relationship with customers I talked about are real. We do 6,000-7,000 customer surveys every month. Our NPS is really, really the best in the industry, so we are well positioned to deal with that. It's gonna impact obviously our margin in the second half in addition to the divisional mix effect I just talked about. Okay, sir. Thank you. The next question comes from the line of Rory McKenzie from UBS. Please go ahead. Hi, André. Just two from me, please. Morning, Rory. Firstly, can you clarify some of the H1 20- Rory, can you speak louder? I cannot hear you very well, sorry. The line is a bit difficult. That's all right. Is that any better? Yeah, better. Yeah. Thank you. Great. Cool. Thank you. Can you just firstly say what the H1 2022 margin was inside China and outside China, and how that trended year-over-year? Secondly, you're clearly talking about more price increases, more demand accelerating. You haven't changed your full year growth guidance. I guess I'm just trying to work out what's changed from the 25th of May statement to today, since you're gonna change your margin outlook overall, if that makes sense. I mean, on the first point, you know, we don't disclose our margin by region. It's commercially sensitive, as you can imagine. There is no question that our margin in China was down and outside of China, the margin was, you know, 20 basis points higher, right? What's basically, you know, in our new guidance, if you want, is we expect, you know, revenues to continue to be very, very robust, right? As you know, there is quite a bit of Forex acceleration that will obviously change the revenue for the company, and I'm sure you've worked it out. As I just explained, you know, the margin guidance is based on a few things, the impact in H1 of the lockdown in China, the fact that, you know, divisional mix is, you know, a bit unfavorable from a, from a margin standpoint. We are having to invest more than we thought to cope with the acceleration of demand in this high inflationary market. The other thing I said, which I wanted to make sure that everybody remember, because I'm not sure, everybody had put that in their margin model, we had GBP 10.5 million of additional government subsidies in the margin that we, you know, delivered in 2021. It was industry leading, as I said. This is also important to understand when you look at your H1, H2, because 1/3 of the benefit was in H1 and 2/3 was in H2. That's basically, you know, what has changed, nothing more. That's a help. Thank you. Just to follow up, maybe you can talk about your headcount plans. Do you think you're still aiming to get to the same total headcount by, say, December of this year as you planned before? It's just the cost of getting there that's changed, or do you think you're also now planning to have a higher headcount given the demand drivers you've been talking about? There is no question that we are having to increase our capability, which is additional headcounts, of course. We expect our headcounts to continue to progress. Okay. Thank you. You're welcome. Next question comes from the line of Sylvia Barker from JP Morgan. Please go ahead. Thank you. Hi, good morning. Morning, Sylvia. Morning. Could I check firstly on the good growth in China? I guess, could you just talk a little bit about what that growth, how you see that growth developing, I guess, after the lockdowns? I suppose there's not that much maybe catch up from your based on your comments. Maybe for the different businesses within that mix are doing. Secondly, on the price versus wage inflation point, at what point during the year do you think you might be able to kind of fully match? Matched out to a point where that's not a drag on the margin anymore. Finally, both Food and AgriWorld actually, you know, did very well in the context of what's happening in the world. Could you maybe talk a little bit about the drivers there and the outlook for the second half? Thank you. Yeah, thanks. Look, as far as H2 in China, the way we think about it, you know, we think about it differently for the testing business that we do versus the inspection assurance and certification. Let's start with the testing, right? If a collection has now been produced in the month of April for the North American market, when the factory is producing in July and August, they are producing for the next obviously collection, right? So what has not been produced will not be, you know, re-produced again, and therefore, you know, factories will operate at full capacity but dealing with the new order. So we don't expect much, you know, catch up there. As far as inspection assurance and certification, which are obviously more, you know, long-term projects or people can delay assurance, inspections, and certification work, I think there will be a bit of catch up there. That's our view. As far as, you know, the price, you know, wage inflation. Look, this is, you know, a very pertinent question. As I said, you know, we got some really good price increase in line with our plans in H1. We have got pricing power. We have planned to take pricing. We took them, and they were obviously embedded in our H1 numbers. As far as the additional price increase, we are taking. Look, this is a B2B business. It takes time to reach out to every single customer that cannot go on TV and say, "Here's a new ATIC solution that is in your price, and you can order online." So it takes time and my sense, it's gonna take us till the end of the year to get all these prices embedded, and we're gonna start 2023 with the effect in the base. I'm not too worried about it. That's the way we do business. As I said earlier, we're doing it for the right thing because we've got growth, and we need to make sure we've got the capability to help our clients. Look, Food and Agri, these are two extremely strong business at Intertek. I mean, the growth drivers are very, you know, easy to understand, you know. World population is growing, food consumption is growing, concerns on health and safety and quality and sustainability are increasing. I mean, I think I talked about it in one of our previous calls. The number of product recalls that we've seen during the last two years has been incredible because of the risk I was just talking about. You know, companies are worried. I mean, just need to look at what's happening in infant nutrition category that I know so well, was my previous time at Reckitt. Look at what's happening live in North America, one of the best, you know, governed countries in the world in terms of food safety. It just give you an indication of the issues. As I, you know, talked at one of the conference the other day, right? The issue in Food and Agri is not the standards. The standards are there. The problems are that the governments are not enforcing these standards. As you know, I spent quite a bit of my career in the food industry, both at PepsiCo and Burger King. I can, you know, assure you that in my 11 years of Burger King, I rarely had any local or national authorities coming and checking the safety of all the ingredients in our kitchens. Obviously, I had the processes in place. That's the world we're in, and I don't want to create too many stories. You know, if you have time, ask your favorite restaurant to show you how clean the kitchen is, and it might not be your favorite restaurant anymore. Noted. Okay, thank you very much. The next question comes from the line of Anvesh Agrawal from Morgan Stanley. Please go ahead. Hi, good morning. This is actually Anvesh Agrawal. I got three questions as well. First, it looks like there is a bit of a slowdown in May-June within transportation and technology business within the products. If you can sort of dwell on that, what's driving that? Second, I saw a bit of a sort of downgrade or lowering of the range on the CapEx, compared to the full year guidance. Given the inflation investments you're talking about, I was wondering what's driving that. Then finally, just to clarify on the subsidy amount, I know the incremental was like 10.5 last year, but if you can comment on what was the total subsidy number, and it. Is the only incremental subsidy going away or and where is that sort of what is the source of that subsidy really? Yeah. Look, as far as Transportation Technology, look, the Transportation Technology business was impacted in May-June by the China lockdown. We have a big business there. And of course, you know, and it's in Shanghai, so that has impacted the run rate. That's essentially the main driver. I think, the issue on CapEx is non-issue. I mean, look, when we give a range, it's really a range. We are at the lower end of our range for now based on the CapEx forecast we did. It could be higher. We are not, you know, CapEx constrained. If there is a great idea at Intertek, be it technology, innovation, new sites, we invest, provided the right segment, the right growth, right margin, right return. I'm not worried about it. In terms of the subsidies, we typically, if you look at our disclosure, we typically get around GBP 5 million of subsidy a year, you know, on average, and it was GBP 10.5 million in addition to this GBP 5 million. That's why I think it's important for your margin model to recognize that. When you look at your margin for the second half, look at it, you know, ex subsidy, which I think is underlying, and you will see that the margin looks pretty good. Just to follow up, do you expect the, that normal GBP 5 million to continue? That is not going away, right? The delta is only 10 point- Look. Yeah, I mean, that's. If it's different, we'll tell you at the end of the year. As you can imagine. Yeah. Forecasting government subsidies is not something that we are the experts in the world. You know, that's what we get on normal basis, right? Yeah. Just on Transportation Technology, sorry. Like even ex-China, if you look, the growth was like low single-digit% in first half, and it was mid-single-digit% January to April. It looks like it slowed even ex-China. Well spotted. That's what your question was on, ongoing. Basically, we've seen a bit of a baseline effect in our US lubricants testing operation in San Antonio. The lubricant testing market is a big market, and there is a regulatory, you know, situations where there is no new regulatory drivers this year, and therefore there's a little bit of slowdown. You know, Yeah. Lubricant companies need to invest into stable lubricant. It's just a you know a temporary effect. We run a great operation. If you are in Texas, I'm very happy to invite you there. You'll be amazed by the type of testing we do there. Fascinating. Yeah, looking forward to that. Thank you. Thanks for your answer. The next question comes from the line of Arthur Truslove from Citi. Please go ahead. Thanks very much. First one from me, just in terms of oil volumes at Caleb Brett. Are you able to just give us an idea, both for the first half as a whole and also for May and June, how far behind 2019 are we in terms of oil volumes? Secondly, kind of following on from that, in 2019, you obviously delivered over GBP 80 million of adjusted EBIT in the trade division. Is there anything that sort of stops you getting back there? And what needs to happen to get you back there? If that makes sense. I guess the third question is, obviously a lot of your peers have talked about, margins going up in the second half reasonably significantly. Just to be clear, are you expecting margins for the group as a whole to go up material in the second half? Thank you. On your first question, look, the best way to look at the market in the downstream segment, which is where Caleb Brett is to look at, you know, supply and demand of barrels of oil per day, right? At the moment, right, we are in around, you know, 97-98, and obviously at the peak, we were obviously higher than that, right? In 100 or 102, you know, 101 or 101.8. We are not back to the level of demand that we saw in 2019-2020. No question about it. Of course, our intention is to go back to the previous peak and to go beyond. As I talked about in the call. In the commentary that I made during the call earlier today is that, you know, the oil and gas market is gonna continue to grow because there is just not enough renewable energy to basically go to net zero at the speed that people want to. The growth outlook is very, very positive for many years to come. We have our own model, and it will be far too detailed for the call today. The growth is very, very positive and there is no question for us. We'll go back to our peak. I'm not putting a time on that because the market has changed and we're gonna need to do that step by step. The growth is very impressive and we are outperforming the industry at the moment, right? As you know, in terms of margin, you know, we don't give quantitative guidance in terms of margin for the full year. We give qualitative guidance, and our second half is always stronger than the first half. Of course, in the second half, we will not have the dilutive effect of China. Yes, our margin in the second half will be stronger than the first half. Just following up on that, is the second half margin likely to be stronger than it was in the prior year? That was what I meant, sorry. That's the guidance we're not giving. We are giving you quite a bit of data to work through your models. What I would advise you to do is you look at last year's performance in terms of margin, which was very strong, with and without the subsidies, and you will see that based on our guidance, to get to what we have guided qualitatively, the margin in the second half will be a good performance. Before we go to the next question, please be reminded, if you would like to ask a question, it's star one. The next question comes from the line of Neil Tyler from Redburn. Please go ahead. Good morning, André. Thank you. Two please. Morning. Firstly, following up on Silvia's question earlier about the answer you gave around the China momentum in the second half. Can you remind us what the split is in your China business between those testing activities that you think are probably permanently lost and inspection certification assurance that you know that might see some catch up? That's the first question. Then secondly, regarding capital allocation M&A, obviously another interesting deal announced today, and you know it seems that there are a few more interesting acquisitions coming your way. How does the M&A pipeline look from here, both in terms of opportunities but also valuations and your capacity to sort of continue to identify and integrate any deals? Thanks. I mean, let's deal with M&A first. The industry, as you know, is very interesting in terms of consolidation. We tend to be very selective. We believe in investing our capital in the high-growth, high-margin segments on sustainable basis. There is no question that, you know, there are quite a few companies like GLA, like CEA out there that would basically bring an IP in a high-growth space opportunity like solar energy or food in Latin America. These are the type of deals that we like, right? We bring a very strong IP in a high-growth, high-margin segment, and we scale it up. We tend to move away from low-margin businesses. As you know, this is not, you know, what we do. If anything, I would say that in terms of M&A, the environment is gonna be favorable for a company like Intertek. As you know, the debt market has risen up very quickly in the second quarter. It's very difficult for private equities to raise any significant amount of financing. You know, companies that are gonna want to monetize their assets will be slightly more reliant on strategic buyers like us. If anything, there will be slightly less competition. It doesn't mean that we're gonna do the wrong thing. I would say that the M&A market looks very, very promising for companies like us, where we are clear about where we want to invest. We've got the balance sheet, we've got the funds, and certainly, we know how to integrate and execute this. Look, as far as the mix of our revenue by solution, as you know, this is not a disclosure that we do on regular basis. As I, you know, promised in one of the other calls, it's something we'll do at the end of 2022. Last time we reported, if I'm correct, Denis, was in 2018, right? At the time, at the group level, you know, assurance was 16%, testing 53%, inspection 22%, and certification was 9%. So that's the group number. Look, I would be surprised if it's materially different, you know, for China, given that China is a good reflection of our global supply chain. Okay. Thank you very much. Can I just quickly follow up on the point on M&A? Can you remind us, in your margin guidance, is there any meaningful year-on-year accretion or dilution from the deals that you've done thus far and particularly in the second half of the year? Well, I mean, as I just said to Arthur, unfortunately, we do not give quantitative guidance. If you look at H1, you would have seen in Jonathan's slides that acquisitions had a positive impact on margin because the GLA and SAI businesses were margin accretive for us. That's the kind of deals that we like, right? That should continue, right? Yeah. Okay. That's excellent. Thank you very much. Thanks, Neil. There are no further questions in the queue, so I will hand the call back to your host for some closing remarks. Well, thank you very much for your time today. I know it's a very busy season, so we look forward to catching up. Denis is on standby if you need any call. Have a good day. Thank you.