Welcome to Strauss Group's First Quarter 2025 Results Earnings Call. On our call today, management will provide a review of the results, followed by a question-and-answer session. You are encouraged to post your questions to the Q&A function in the Zoom. As a reminder, this online Zoom earnings call is being recorded Wednesday, May 28th, 2025. A recording of this call will be available on the company's website a few hours after the call. I would like to remind everyone that this online webinar may contain projections or other forward-looking statements regarding future events or the future performance of the company. These statements are only predictions and may change as time passes. Strauss Group does not assume any obligation to update this information. Actual events or results may differ materially from those projected, including as a result of changing industry and market trends, reduced demand for our products, the timely development of our new products and their adoption by the market, increased competition in the industry, and price reductions, as well as due to risks identified in the documents filed by the company with the Israeli Securities Authority. Online with me today are Mr. Shai Babad, Strauss Group's President and CEO, and Mr. Tobi Fischbein, Group CFO, and myself, Rivka Neufeld, Head of Investor Relations. We will begin with a review of the quarterly results by CEO Shai Babad and then move on to financial highlights of the quarter presented by CFO Tobi Fischbein. We will then move on to a Q&A session. Shai, the floor is yours. Thank you very much, Rivka. With us today joining Tobi Fischbein, Tobi, we are very, very happy and delighted to have you with us. He's the new CFO of the company. Thank you, and thank you, everybody, for joining us all together. I'll be giving a short review of the quarter in the next 10-15 minutes, and then Tobi will go deeply into the financial results, a little bit of analysis there, and then we'll take some questions. Let's start. Looking at Q1, some major highlights of the quarter is that we see that in this quarter, which was, we believe, a strong quarter for us, a very strong growth on the top line, mainly due to price increases, mainly done in Brazil. We see that there is still pressure on EBIT due to raw materials, so EBIT margins are falling. On the other hand, if we look at PlatforMa 2025 Q1 compared to Q1 2024, and we take out Sabra and Obela, and we take out Serbia, which we have divested, and we take out the one-time derivatives loss of ILS 49 million, which we lost on the cocoa derivatives, a loss which was done already last year when we did the derivatives. In the GAAP reports, it has already been accounted for in 2024. Now, since the position was closed in the first quarter of 2025, it affected the EBIT of Q1 2025 by ILS 50 million. If I take that out, if I exclude those, then actually this quarter EBIT is higher, more than 10% in a double digit than the previous quarter in 2024. When we're looking at the strategy, our long-term strategy goals, we think that we are on the road, on the right path of executing our strategy. Maalot, one of our rating companies, affirmed our rating at AA and made it stable from a negative forecast. When we look at the dividends that we have distributed to our shareholders, then ILS 200 million were paid in the first quarter in account of the Sabra divest, and another ILS 160 million were announced and paid due to the results of 2024. Looking at the overall results, we see a substantial growth in revenues, as we discussed before, of 15.5% if we look to previous year. Looking to pro forma and excluding Sabra and Obela and Serbia, which were divested, we are looking at more than 20%, around 23% growth. EBIT-wise, you see a low decline of 11%, but again, if we take out the one derivatives, there's actually an increase of more than 10%. In the net profit, the major gap comes from those derivatives, the one-time derivatives, and also from tax [Foreign language], the word in English. What we thought we would pay in taxes compared to what actually was announced by the tax authority that we need to pay. According to what was announced by the tax authority, we have made, we thought that the sum would be much higher. Hence, there is a ILS 60 million percent difference between what we put in the books and what was actually done last year compared to this year, which we didn't have those tax discounts. When we look at the cash flow, there's a ILS 500,000,000 loss in cash flow. Tobi will talk about that more and go into that about more. The major thing that I'll say is if we look at compared to last year, which was also negative, the major accounts for higher negative cash flow is due to operations in Brazil, mainly due to the cost of raw materials, and Tobi will elaborate more on that further. When we look at the activity into the three different sectors, Strauss Israel, Strauss Coffee International, and Strauss Water, we see growth more than what we said in the targets of 5% in all activities. In Strauss Israel, there's a 6% growth. Again, here we see all the derivatives impact, which took down the profit to ILS 113 million. If we take out those ILS 49 million, we actually reach to ILS 161 million and ILS 161 million, ILS 162 million, which is an increase compared to last year. Overall, and we'll see that later, we grew in all our categories in Strauss Israel with a very nice growth. When it comes to profit, if I take out funding indulgence and our confectionery business, all our businesses in Israel are in growth and also in nice profits growth as well. When we look at Strauss Coffee International, the major story here is Brazil. I think we talked about it many times in the quarters, the previous quarters, in which we said that once coffee prices, green coffee prices will stabilize, we'll reach a point where we, with the pricing that we have done in Brazil, will catch up the gap that we had with green coffee prices, and Brazil will start getting, and Brazil results on the profit side will start improving substantially. I think that we see that already here now in the first quarter with better results than last year's first quarter. Also looking ahead through the year, if coffee prices, if green coffee prices will continue to be stabilized, we forecast that this year will be good for Brazil. Of course, we see here a 45% increase also in sales, mainly due to price increases that we have done. Another strong point about Brazil is that although we increased prices and net prices of green coffee, of roasted and ground by almost 100% on the overall portfolio, it affected by 45.4%, we still maintained our market share. We are still the market leader. We actually a little bit even increased our market share in the first quarter, and we managed to get higher profit. Of course, because everything is due to price increase, profitability levels are not improving as we would have projected. When we look at Strauss Water, again, here a nice growth of 7% and also EBIT growth and with of almost 10% and double-digit margins. Our EBIT here comes from our operations in China and our operations in Israel, and in both of them, we see that we are improving. I think still it's worth mentioning, although you've seen this also in the previous quarters, what's going on in Robusta, Arabica, and cocoa, which constitute about 60-65% of our raw materials. You can see Robusta increasing by 300% since 2020, Arabica increasing by 212% since 2020, with a 100% increase actually from last year. You can see the dip curve. Cocoa price is increasing by 300%, 270% since 2020, with a 50, and on the bottom line, you can see what it is quarter to quarter. This has, of course, a substantial impact on our results. I think the good thing about this quarter is that we managed in most of the categories, in most of the geographies, to actually roll out to the customers all the price increase that we encountered so that the total profit, the absolute profit, will remain and actually increase in some of the cases, as we talked about in Brazil and as I'll show a second in Israel. Next. When we look at Strauss Israel, just a few words about health and wellness and fun and indulgence. You can see that in health and wellness, there's moderate growth in revenues and a very nice improvement in EBIT. The moderate growth in revenues comes from the fact that we have capacity constraints, and I'll talk about it later, how are we going to open until the end of the year those capacity constraints, which will allow us a higher growth. In the EBIT, a lot of the improvement is done through productivity. As we said in our strategy, we set up on ourselves a road to improve by ILS 300 million-ILS 400 million platformatic improvement from 2023. And already in the different segments, as in Brazil, that some of it is productivity, but also here, we already see how this is impacting the results. I'll say later on where we are in the track of reaching those goals. When we look at filing indulgement, here is the big gap. It's a - 16 loss. Of course, a lot of that loss is due to the ILS 49 million in the derivatives, the cocoa derivatives, but not only. Last year, first quarter, cocoa prices were very low. The rally in the prices of cocoa beans started only in March, April, when it really boomed was like a three-week rally where it increased by 150-200%. Last year, first quarter, still 2024, first quarter was not affected by high cocoa prices. In this quarter, we have high cocoa prices, which are much, much higher than first quarter last year, and also the impact of the derivatives, which affected the results. When we look at our coffee activity, even in Israel, although coffee prices have increased, you see here that through innovation and very, very hard work on the top line, we have managed to, and growth, we have managed and price increase in some cases, we have managed to improve the EBIT in funding indulgement coffee segment. The total results you already see. Coffee International, I talked about Brazil. I think there is no further thing that I can say here beside the fact that if we look ahead, then we see as long as coffee prices will maintain the same, we believe that we can continue to improve the results and that Brazil right now is forecasted to have a good year. When we look at Strauss Water, our second plant there is in very, very progressed stages. You can see how it was in December 2024. This is a second plant for building our filters and our under-the-sink machines. You can see March 2025. Actually, there is a recent picture which we have not yet been able to put, but it is all by the end of this year, the factory will be ready. We are increasing our sales up to targets and also with double-digit margins in China following our strategy. I would like a little bit to talk about moving forward and our focus ahead, what will be our growth engines and to talk a little bit about how this is implemented by our strategy. Next. When we look in Israel, part of our growth plan is to really be consumer-centric, to really understand the trends, the different trends in the food segment, where the trends are going, where consumers are going. I am not going to go deeply into that. I'm just going to show you an example of how we analyze this. We take the X axis and the Y axis and we say when a consumer goes for escapism or he wants full control of what he eats or whether he likes to eat alone or he likes to eat together with people. The different trends that we have. Some consumer wants unique experience, a lot of snacking and snackification, which is a trend, heritage and nostalgia, special moments and what that food means to me, shared experience of things we eat together, et cetera, et cetera. We analyze what are the biggest trends in the food industry. Therefore, if you look next slide, if you look at our innovation, what helped us grow a lot in Israel this quarter and will also help us ahead. You can see that we followed those trends. We look at a trend of added value and we went out with innovation with our multi-yogurt, which is a very healthy yogurt, mainly for the third age and with vitamins and minerals added to it. You can see on the right-hand side also on the added value to you, we have expanded our portfolio in the pro proteins products from yogurts to snacks to milk drinks, protein milk drinks. We have given different tastes and different products in that category with innovation. When we look at lifestyle, it's the same gluten-free. We had a huge in the segment of confectionery, we had a huge launch and innovation of different variety of our products in gluten-free. There was a big campaign around that. When it talks about portion control, again, reducing the amount of sugar, reducing the amount of substances which are raw materials which are not healthy for those who do portion control. When we look about heritage and nostalgia, you can see here a little bit, you know, our products from the confectionery who are brands that have been followed for many, many, many years. People share them and eat them because it reminds them of very, very special moments. This is just the kind of innovation that we're bringing. A lot of the new sales that comes from our innovation help us grow. In all those categories, we actually improved market share in Israel. Next. One big news that we are all waiting and very excited for is by the end of this year, our plant-based factory, which started a few years ago, is going to be ready and we're going to launch our new products in September, October towards the fourth quarter this year. That means that we will give variety of our products, our very love products, which today we do in a milk version, also in a plant-base. Some of it we already have in Israel because we import them or we do outsource. It's the Alpro drinks, Alpro milk alternative drinks. Now we're not going to have a much larger variety of alternative milk drinks. We're also going to have alternative yogurts, alternative milk yogurts and alternative milk desserts, plant-based desserts and plant-based yogurts, which is part of our portfolio, which is part of our love brands. We believe that through this innovation and through actually serving different communities and giving added value with those new variety of products in plant-based, it will be a major engine of growth here in Israel. Also, I have shown you before that in health and wellness, growth in revenues was moderate. Part of the reason that it was moderate is because in our Yo tvata milk drinks factory down at the south, there are capacity constraints. By the end of this year, a new line will already be in place and implemented. Once that is in place, it will extend our capacity substantially. Therefore, a very large demand that today is not answered by our factory because it is full will be able to be answered. We believe this will give us also a big jump and a big growth engines in our milk drinks once the new line will be in place. In Brazil, we are continuing our journey with the non-R&G, enlarging the non-R&G segments. All our categories in the non-R&G are double-digit margins when it comes to EBIT and are growing very nicely, much more than 5%. We are looking at various M&As. We think we will conclude one deal at least by the end of this year. We also think that extending our non-R&G will help us better hedge green coffee prices in Brazil and also have healthy growth of the business in Brazil. The last thing that I want to say about growth engines, which is not in the slides regarding our water business, we talked in previous quarters about taking our water company and making it from a single product company to a multi-product company. In the next few months, in Q2 and in Q3, there are going to be several launches of new products that we're going to launch in the Israeli market, which will have different functionality on the one side and, on the other hand, different price tag. We believe that this will help us grow and enlarge our exposure here in the Israeli market and will give a better answer to some of the consumers and the consumer needs. It also will help us later on build and service also in our international activity in the water business. One last thing that I'll tell about the water as well is that in the U.K., which is a relatively small business, we managed to do a turnaround with the partnership with Culligan. The business is now profitable with a new brand launch that we've done that was very, very successful in the U.K. Some of the new products that we are going to launch already this year are going to go also to the U.K. to help us grow there as well. When we look at the productivity roadmap and the goal that we set ourselves to be between NIS 300 million and NIS 400 million, we are working very, very hard on the different streams. When it comes to strategic procurement, we have changed the way we do the procurements. We've changed the way we negotiate and what we know about our suppliers. A lot of work and capabilities and tools we've brought in, which help us become much more productive. Also, when we talk about operational excellence, we have adopted the IWS method of Procter & Gamble, implementing it in several of our factories already. By the end of 2026, in all of our factories, it will be implemented. It helps us raise our OEE, our utilization of the plant. It helps us get much higher productivity and, as we say, produce more on the machines with less time and helps us also deal with capacity constraints. Also, on the side of revenue growth and management, what we call RGM and marketing, new tools were brought in, new methods were adapted, designed to value methods were adapted. All of those things help us to build new capabilities, to change the mindset and to help us face the changing world and the dynamics of our industry. As we have seen in this first quarter, if we neutralize all the one effects and the divestments, we can actually see that we have managed to improve our profits. Part of it is our EBIT and part of it is, of course, because of the productivity work that we have done. Next. Lastly, before I finish, when we look at the long-term goals, we think we are in line in all of them. Also, when we look at EBIT and EBIT margins, here we still stick to the same targets that we have put because there is a big question mark and big uncertainty about what is going to go with cocoa prices and coffee prices. Of course, we will look into that. The closer we come to 2026 and the end of 2026 and the strategy, if we think, and then we'll know more about coffee prices and cocoa prices, if we think we need to update it, we'll look at it. Right now, we're still thinking that we're keeping the same targets. One thing I would want to say, taking out the margins, if we look at the absolute profit that we projected in the beginning of the plan, taking into account that we'll only grow 5% a year and not 10 or 20 or 15 or 7 or 8, we believe we can reach the absolute value of profit of the strategy plan. Regarding the margins, that's still a question as to what will happen with coffee prices and cocoa prices in the midterm. That will be smarter in the next few quarters. For now, we are sticking to the same margins and to the same targets. Regarding the rest of the long-term targets that we've set, we believe that we are on track to achieve all of them. With that, I will transfer it to Tobi. Tobi, good luck. Thank you very much, Shai. I'm very happy to be here with you today presenting the first quarter of the year to our investors. On slide 20 of the presentation, we see net sales that presented strong growth supported by pricing, improved sales mix, and higher volumes in key markets. While the company faced ongoing input cost inflation, mainly from green coffee and cocoa, the sales and gross profit during the quarter was also impacted by the sale of Sabra and Obela during Q4 of 2024. Productivity initiatives continued during the quarter, but the lower EBIT and higher tax paid led to a decline in net income. Moving to slide 21. Looking at the group sales in the quarter, we see decent growth in all segments. The most significant contribution came from Coffee International, especially Brazil, while we also see the impact of the divestment of Sabra and Obela, which were consolidated in the non-GAAP results of Q1 2024. On the right, we see that Strauss Israel continues to be the largest business for the group, with Coffee International not far behind after achieving significant growth during the quarter. Moving to the next slide, gross profit declined due to raw material cost inflation, mainly green coffee and cocoa, as well as the realization of a NIS 49 million non-recurring loss on cocoa derivatives as announced with the 2024 full year results. Excluding these non-recurring loss, gross profit would have reached NIS 830 million, reflecting a 27.7% margin. Productivity initiatives across the group continue to support operational efficiencies. On slide 23, EBIT in Q1 totaled NIS 181 million and 11.2% decline year over year. Excluding the non-recurring loss on cocoa derivatives, the EBIT would have increased to NIS 230 million or 12.7%, and the EBIT margin would have been 7.7%, not very different from the 7.8% achieved in the corresponding quarter. Productivity initiatives across the group continue to support operational efficiencies. On slide 24, we can see EBIT and EBIT margins achieved by segments. Excluding the one-off cocoa derivative impact, also Strauss Israel improved EBIT versus the same quarter last year, despite the much higher green coffee and cocoa input cost. Jumping to slide 26, we can see an increase in net debt and net debt to EBITDA ratio in comparison to the end of 2024, mainly due to working capital increase and dividend payments during the first quarter of 2025. We were happy to recently receive Maalot S&P AA stable outlook rating affirmed. Moving on to Strauss Israel on slide 28. Strauss Israel posted a 6.6% top line growth supported by product launches and innovation that we bring to our customers, as Shai described earlier. As already mentioned, the profit of the business was impacted by the NIS 49 million non-recurring loss on cocoa derivatives. Looking a little closer at the sales on slide 29, we can see the sales growth that was achieved across the board. In health and wellness, we divested during 2024 from our fresh cut vegetables. If we take that into account, the segment would have shown even higher sales growth. While sales primarily grew through pricing adjustments, I'm happy to say that we also achieved volume growth in many of our categories. Moving to the EBIT on slide 31, we can see the contribution of each segment here with the Health and Wellness segment, which is the most significant in Israel, posting a healthy quarter with improved EBIT and EBIT margins. Even excluding the one-off cocoa derivative impact, we still see an impact on our EBIT and its margin in the snacks and confectionery segment. Green coffee cost inflation continued to impact our Coffee Israel segment margins. Moving to Coffee International on slide 33. Looking at the performance of this segment, we see extraordinary growth in sales that was driven primarily by pricing, but also by volume growth in most geographies. These sales growth mostly offset green coffee input cost inflation, while operational efficiencies supported margins. On slide 34, Strauss Coffee International Q1 2025 sales. On this slide, we can see sales growth across all geographies, with exchange rates mostly working against us this period. Moving to water on slide 37, sales were mainly impacted by an increase in the install base and an increase in appliances sold. Looking at the EBIT, productivity initiatives are increasingly being implemented in the business, and we see the benefits of these in addition to an increase in the company's equity share in our Chinese higher Strauss Water JV profit. Slide 39 to summarize the first quarter of 2025. Pricing and volume mix supported by the value our customers see in our products, along with the implementation of productivity initiatives, have allowed us to deal with green coffee and cocoa input cost inflation. Much higher sales and raw material costs in coffee and cocoa result in higher working capital needs, but we are well positioned to benefit from leading market share in key categories and underlying growth potential in strategic segments, both in Israel and internationally. I will now open the call for questions. Rivka? Thank you, Tobi. We will now move on to questions you have sent. The first question, can you give us any indication as to the market and demand for plant-based milk alternatives? Can you give us any indication regarding the market and demand for plant-based milk alternatives? Yeah, of course. In Israel, this market is growing. It has been growing rapidly over the past few years. There was a slight slow in the last year, but it's still, it's a very, very big and important segment in Israel. We also believe that through bringing into the segments yogurts and desserts, which today are not so in the segment and not so in the market, through our loved brands and through our products, we will be able actually to grow the segments and to provide alternatives that today are not in the market. We foresee this as a substantial growth engine here for us in Israel. Thank you, Shai. The next question, what is remaining in terms of disposal or divestment in order to reach the 85% core activities target? We are not in a place that we can disclose if there will be any more future divestments. As you know, this is information we have not revealed. What we can say is that we are on track and we are working on track to be on 85% core of our activity. We are working according to plan. Summer was through divestments that you've seen. I will not talk about further divestments, but I will talk about the fact that, and what we've done so far and that we'll continue to do, is optimizing our portfolio by closing SKUs and by closing some of our activities and focusing more on our core activities. This is something we're doing ongoing, and we believe we'll be able to reach the 85%. Thank you. We'll wait one more moment to see if we get any additional questions. With that, I will return the call to you, Shai, for closing remarks. Thank you, Rivka. Thank you, Tobi. We are very happy that you've joined us. I think that, you know, as I said in the beginning, I think it was a strong quarter for us, although we had a lot of headwinds that came with the raw material price increases and substantial changes here in the market with everything that is going on. We still manage to keep the same level of profits. Actually, if we take out the one-time derivatives, actually improved our profits, our operating profit. We had substantial growth in top line, not just because of price increase, a lot of innovation that is done. We have grown in market share in most of our categories, and we also had some volume growth in our categories. Overall, we think it was a good quarter, a solid quarter. Looking ahead, as long as coffee prices will remain the same, we think that the very good results that were examined by Brazil and our operations there will continue through the year. I will take this time with this place to hope that all 58 hostages today, 600 days for our hostages that are still there, that all 58 hostages will return home safely as soon as possible, that the war will be over as soon as possible, that we'll have some peace and quiet, and that everybody will return home safely to their families. Thank you very, very much for joining us here today, and we'll see you again next quarter. Thank you for joining Strauss Group's first quarter 2025 results earnings call. This concludes our call for today. Thank you. Thank you.