Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Buzzi Unicem Full Year 2020 Results Conference Call. As a reminder all participants are in listen-only mode. After the presentation there will be an opportunity to ask questions. At this time, I would like to turn the conference over to Mr. Pietro Buzzi, Managing Director of Buzzi Unicem. Mr. Buzzi, you have the floor. Thank you. Good afternoon to everyone. I'm here together with Patrick Klein, our Group Treasurer, and also Lorenzo Coaloa, Investor Relator, that will be part of the conference together with me and available to help me for any kind of question that you may raise. We published two hours ago, or one hour ago, the press release on our approval of the full year financial statements, full results for 2020. Some of this we disclose previously at the beginning of February, particularly net sales and net debt, and volume and prices trends, so in general, the underlying operating assumption. We already envisaged, let's say, we would get guidance for the full year results, at least at the operating ratio level, which eventually was respected. I mean, it was achieved. We closed actually slightly better in terms of recurring EBITDA. The reported EBITDA is on track. That's what we mentioned already in intro, which is the EUR 718 million, a very good figure. A figure that absolutely we did not expect, at least not last year at the same time when there was a lot of uncertainty and risk coming up. We cannot be, I think, more satisfied than that in terms of the outcome for the full year. Clearly, this is also the strong result operating and also net income are setting quite a high bar, quite threshold for the current, let's say, 2021. Even if it may sound somehow disappointing, the message that we gave in the outlook, it should also be seen, in our opinion, should be considered with the exceptionally good results that we achieved in 2020 that are really difficult, let's say, to overcome. Nothing is impossible, really difficult to do better in an environment that is anyway bringing some quite significant rebound in industry inflation. I try to guide you through as quickly as possible the results, and then turn back to you the floor for the Q&A session. The results were driven not so much by volumes, because if you look at the volumes trend, we are basically flat at the group level versus last year with the majority of the countries that are showing slightly negative signs. The only positive sign or the only favorable variances that we had, the most significant one was in the U.S., where the market performed really very well, also in the last quarter. With a 5% improvement versus last year. Germany, quite stable. Actually, the domestic market was up versus last year, but we suffer from lower oil well cement shipments going abroad. There's export sale that offset, let's say, partially the good performance of the domestic market. Overall, anyway, we closed with no less than last year in terms of volume. Other markets, all of them, let's say, slightly negative, minus three, minus four. Positive sign instead, positive variance in Russia. A strong recovery, let's say, in the second half of the year, driven by, I would say, a good performance in terms of market share from our companies and also stronger, let's say, demand coming from public works. Also in Russia, we suffer from lower oil well cement shipments that they do represent, in Russia, a significant portion of our sales, but nevertheless, the total cement sales are gray and oil well closed the year above 2019. Slightly up, 2% up. Two countries we have a strong interest, Mexico and Brazil, were going the opposite way. They were the only, not the only, but the two countries where instead the flow, the shipments trend was very strong. Mexico performed 12% up versus last year in terms of cement sales, and Brazil 9+, let's say, percent up. These figures are reflected only in the equity earnings, let's say, line of the income statement. Not a big help coming from volumes. More help, let's say, more contribution coming from the price trend, which was positive, let's say, favorable, across basically the entire scope of consolidation with at least in local currency, we had prices improving basically everywhere, with the only exception of Ukraine, where the local currency pricing was flat or slightly negative versus last year due to some volume pressure due to imports coming into the country from basically from the Black Sea. While looking at the joint ventures, Mexico was basically flat in pricing. U.S. was basically flat or slightly better, but not much in the case of U.S. Yes, the dollar has been the major driver. For the rest, as I said, nice, let's say, price improvements in Italy, Germany, also Poland had a significant price improvement versus last year, and Czech Republic too, improving. On the, let's say, results and revenues, quite a significant impact can be referred to the trend of the Forex. In particular, countries that for us do represent, let's say, a significant portion of our business, like the U.S. and Russia, they both showed a negative variance of exchange rate. Not so much in the U.S. because on average, we had a -2% for the full year. Much more significant in Russia. The ruble lost about 14% during 2020. Other major, let's say, devaluation of currencies against the euro, currencies that had an impact on our books can be referred to Mexico with a similar devaluation as Russia at about 14%. A major one, unfortunately in Brazil, -34%, so a big loss for the Brazilian real during 2020. Net sales that were already in February, they are flat versus last year. Like for like, almost +2%. Forex impact, - EUR 28 million in Russia, -EUR 26 million in the United States. Overall, almost EUR 70 million, EUR 69 million Forex negative impact on sales for the full year. This brings to basically the flat total turnover. You have countries that in Europe are showing a limited improvement. Again, talking specifically the U.S. and Germany. Anywhere else, either you have a decline or almost flat, let's say, level versus 2019. The two joint ventures perform very well in local currency. You have a +10% turnover in Mexico, almost 40% up currency turnover for Brazil, which was coming from a very low level clearly in the previous year. Unfortunately, Brazil is almost flat after translation of their financial statement versus last year. Meanwhile, Mexico is not improving, but is getting very close to the same level as last year in euro-denominated values, let's say. Moving to the operating cash flow by country. Here, the picture is quite different, can be explained basically by the trend, by the favorable, let's say, tailwind that we experienced during the year on the cost, which in part was external, let's say, mainly external, and particularly the decline in the cost of energy inputs. In part was obviously also coming from, let's say, close cost management during the year, particularly when we realized the beginning of the second quarter that things may get worse. We had a number, let's say, of projects, of let's say, focus particularly on some of the fixed costs like maintenance and then decided where and when to maybe align these projects and adjust this project to the new scenario and the new environment. Overall, there are very few that are performed in terms of operating cash flow worse than last year. If they do, like for example, in Russia, it's more a matter of foreign exchange than underlying, let's say, local currency trend. We do have a decline in Italy, which is quite significant if you wish, but this is driven by two reasons. One, that Italy was the only country unable to work and to produce and sell during the month of April. Between March and April, and went back into operation at the beginning of May, but of course, slowly coming up after the lockdown. Second, because Italy last year had, within its figures, intercompany sales of CO2 sales, which did not occur this year. Actually, if you clean the data, you adjust it for the missing, let's say, CO2 sales. Our EBITDA is actually better than last year because the recovery during the second half was quite good and volumes lost were partially recovered, prices did well, and also the cost, like in the other countries, were more favorable than last year. A strong result, let's say, in the U.S., clearly partially affected by the exchange rate. But like for like, we have a 12% improvement in EBITDA in the U.S. versus last year. Even stronger in percentage if we proportion the performance of Germany, + EUR 21 million, which means 20% up versus last year. Stable or slightly negative, let's say, the Benelux, Luxembourg, and the Netherlands, with - EUR 4 million. For the rest, again, countries that did not perform particularly well in terms of volumes like Czech Republic, Poland, and Ukraine, anyway able to improve some of their results versus last year. Russia, a good performance in local currency. As I said, fortunately translating into somewhat lower EBITDA after considering also the ruble devaluation. The joint ventures did well in terms of operating cash flow. In this case, we had, in Mexico, an improvement. Also in Europe, this is quite a significant achievement. Same thing for Brazil, which is showing a stronger, let's say, operating cash flow in Europe. Also, again, after such a significant devaluation as we mentioned before. There are some non-recurring items in the EUR 181 million figure. They refer to Italy for about EUR 3.6 million. Let's say the recurring EBITDA of Italy is actually EUR 3.6 million higher, greater. A small one in Germany, EUR 0.4 million. No, sorry. The Italian value is -EUR 1.6 million. It's not EUR 3.6 million. Germany is zero this year. Instead, we have a negative in Russia due to a legal dispute that is still open but was anyway accounted for as a negative result for EUR 2.6 million. Russia is actually affected EUR 6 million in its EBITDA and slightly better the recurring figures. Looking at the EBITDA bridge, just to summarize what I mentioned so far, let's say. The volume impact, the negative volume impact is about EUR 9 million. Price effect instead is If I remember it correctly, let me check. EUR 52 million. We had a EUR 45 million improvement coming from the variable cost. The so-called mainly the energy input and mainly fuel, actually. Power was also favorable. Logistic, let's say transportation, was also favorable. The main advantage came from the fuel cost last year. Fixed cost stable versus last year, basically. It's mainly due to what I mentioned before in terms of maintenance progress, which were somewhat delayed or anyway kept under strict control. Negative variance of about EUR 30 million on other items that include particularly the inventory changes. The fact that anyway, also due to the strong shipping season in the last quarter, inventory declined towards the end of the year versus the level of year-end of 2019. This affected again, EBITDA by approximately EUR 30 million. CO2 cost that we did not have basically last year, much less in proportion due to the fact that instead, again, using, let's say, the intercompany reserves, we prefer to purchase outside the country that we are in the need or to, in short position, let's say, for CO2, purchase their rights outside and the additional cost charged, let's say, to the 2020 income statement versus last year is about EUR 15 million. The negative impact coming from Forex, which is overall on the EBITDA almost EUR 21 million. This should lead you to the EUR 781 million versus the EUR 728 million achieved in 2019. Just to give you an idea, looking at the cement business, the energy cost impact here, the advantage that we enjoyed this year and that unfortunately is already moving, let's say, in a different way in 2021 is quite major and is quite significant because the total energy bill, so fuel and power for last year was EUR 295 million, representing approximately 14% of our revenues. The previous year, we had EUR 357 million, representing almost 17% of revenues. This is partly due to the volume and price trend, but mainly due to the lower input costs. Between the two, as I mentioned before, the advantage is mostly coming from the trend of power cost strongly declining, and energy cost also, but not as much. Going to the lower part of the income statement, this was also quite advantageous versus last year because after a slightly lower, let's say, depreciation and amortization, we have an improvement in operating profit in EBIT that amounts to EUR 56 million, versus an improvement of EUR 53 million, so EUR 3 million more, let's say, at the EBITDA level. The profitability, so the return on sales, has achieved 16.3% versus 14.5% last year. Strong also contribution in the income statement versus last year in the equity earnings from associates. This is related to the very good performance, as I mentioned before, of Mexico, Brazil, and also other countries that we are not consolidating, let's say, line by line, less important, but still. In particular, this is due to the big gain on disposal realized by our associate, Kosmos Cement. This was already included in the semi-annual results because the closing of the transaction occurred in March. We had a significant gain clearly into this line, which totals, just to give you the right EUR 105 million. EUR 105 million, yes. Before tax, because it's a partnership. Anyway, a big portion of the EUR 176 million total is associated with the, let's call it, extraordinary disposal of our associate, Kosmos Cement. We were also able to somehow bring down almost to the net finance cost. Clearly, within this item, you have both cash, let's call it, expenses, interest expense or interest income, and other items that do not represent either a cash outflow or inflow, like Forex gains or losses, derivative valuation, et cetera. We were favored, let's say, mainly by the trend in these specific items that do not translate into an actual cash inflow or outflow, particularly the Forex gain. Anyway, at the end, we had a benefit in the income statement, and we achieved almost zero, let's say, net finance cost for the full year. Profit before tax, around EUR 700 million. Income tax expense, the tax rate is very similar to the one of the previous year, around 20%. Net profit, clearly very high, EUR 560 million, to a good extent coming from an extraordinary, let's call it, gains, but also a consequence or an outcome from the operating performance that we commented upon just recently. A brief focus on the cash flow statement. The cash generated from operations is EUR 744 million versus EUR 690 million last year. Almost 2% up in terms of percentage of sales, let's say. We have higher income tax paid, also due to the higher results. In part, this is also coming from potentially not necessarily matching, let's say, the accrued tax expense for the full year. Interest paid, similar to last year, only EUR 2 million less. In terms of net cash activities, we go down, reduce the amount to EUR 589 million versus EUR 575 million last year. The impact of the full consolidated cash flow statement on the net financial position is getting very close to last year. Last year, we improved the net financial position by the EUR 322 million, and this year we improved by EUR 326 million. Clearly, within the outflow of this year, we have a much higher dividend payments, EUR 32 million original dividend last year, but also the EUR 144 million included in the net financial position and paid shortly after the end of 2020. We have also much higher dividend received. Coming to a large extent, again, from the Kosmos gain on disposal. We had a little less capital expenditure. Capital expenditure, we also reviewed very promptly at the beginning of the pandemic. We decided to, let's say, slow down and possibly postpone some of the CapEx projects, because we didn't know exactly what was going to happen. This translated into some delay, and at the end of the year, a decline in total capital expenditure. They represent EUR 228 million outflow this year, versus EUR 257 million last year. Other major items are not clearly worth mentioning. As I said, the improvement after an overall dividend payment of almost EUR 180 million, the improvement in the net financial position is still EUR 26 million. Very good. For sure, a very good performance. What else? I think we covered the most significant item. Yes, I think we can move to the Q&A session, so we can devote more time to that and focus maybe on the subject that are more of interest to you. Excuse me. This is the Chorus Call conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question, may press star and one on their touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Paul Roger of Exane BNP Paribas. Please go ahead. Yeah. Good afternoon, Pietro. Good afternoon, everybody. Yes, I've got two questions to start with. The first one is on your U.S. guidance. Yes. Clearly, a lot of other people have given an outlook, and most of them are actually really quite bullish. Particularly with regard to prices. When we look at the commentary, that applies to a lot of your regions, Mississippi, Northeast Texas. I guess the question is, given that read across, I'd have expected you to be a bit more upbeat. Is there something company specific we need to be aware of, or are you seeing a less positive pricing outlook, or is it really just a case of you being conservative early in the year? That's the first question. The second question is on CO2. You mentioned sustainability CapEx. How much is that likely to be? Are you going to update your CO2 targets beyond 2022 soon? Yeah, sure. Well, I think that there are probably in the U.S., potentially more opportunities maybe than risk. You're right. These opportunities, at least is our belief, and it's partly yes, company related, like you mentioned. They're coming on more on the volume side than on the price side. If you want to put it differently, they will also translate into higher prices anyway. We will need them, let's say, in a sense, to offset the cost. In our budget, we could be somewhat conservative on the volumes, but I think we are quite realistic on the relationship between prices and costs. Yes, you're right. We have some region that are more complicated maybe than other. The Northeast is one, the Houston market is another one, and other maybe company specific that I don't think it's the case to go into the detail right now. Related to some, let's call it customer relationship that are helping us on this side, on the volume side, but not necessarily on the price side. How can I say? This is our view right now. I think that the first, we can give it, but not necessarily as usual, good one for the full year. I think we could maybe reassess somewhat our view by the end of the semester. Also, this is important to mention, maybe some of the competitors are always talking about, let's say, like for like improvement. Meanwhile, we are let's say, assessing a likely outcome for the U.S. business already translating to Europe. There is probably, at least this is what your budget is, there's probably going to be some foreign negative, unfavorable, let's say, currency impact. These three, let's call it, prices, cost for volume pricing, cost and negative, likely negative Forex range impact are, let's say, summarized or they summarize to something that we believe is not going to be, unfortunately, as good as 2020. On the second point, no, this was just a way to recall that like any other companies, we are involved in a process that is very important, that it will be long lasting because it's not something that you can solve very quickly, let's say, in this process to achieve, let's call it, the famous carbon neutrality by 2050. Again, we are following this process, I think, in the right way, in close contact and in close cooperation with the major, let's say, industry association. These industry association, okay, in the case of Cembureau, they already come up with some roadmap. The GCCA, the Global Cement Association is working on it. Again, we are very much involved into that directly with our people, also with our opinion, because it's not necessarily the same opinion of the other competitors. In terms of CapEx, I think the message that we wanted to give in this phase is that we are involved and we are doing something, and we will do something more, let's say, going forward. It's not really changing the overall, let's say, CapEx level for this year, which is going to be greater than last year, but not necessarily because of this reason. I mean, it's a part, but it's not, let's say, the main reason why CapEx are going up. CapEx are going up somewhat because last year we postponed some of the projects and because we have some, let's call it, special projects targeted to, yes, efficiency, which also means, let's say, CO2 reduction and to limited extent also to capacity improvement. Within that, we will really test, focus, and evaluate the CapEx spending more and more in the light of the, let's call it, CO2 neutrality that we are targeting in the long run. Sorry, just to follow up on the specific targets for CO2 intensity. I believe you're still targeting 2022. All your other peers are tight for 2030. Will that be something you're looking to revise sometime soon? We are not in a rush. The GCCA roadmap is being discussed recently, still not fully agreed upon by the associates, let's say, by the members. Yes. It's one of our key goals for this year to come up with something that is plausible, feasible, and that it will extend our objectives in the longer run. It's not something that anyway you solve. I mean, you can make the announcement, this is not, in our opinion, is not really the point. The point is to work in that direction, to work in the way that we are used to. Making the right step in the right direction. I don't know much, really, maybe some of the investors prefer communication versus actual results or, how could I say? We tend to believe that is more importantly, to focus on what we can do and what we can achieve, and then communicate rather than communicate first and then maybe not achieving. Anyway, don't be afraid. We will come up. Not tomorrow, but yes, in less than one year time. Understood. Thank you very much for taking our questions. You're welcome. The next question is from Brijesh Siya of HSBC. You have the floor. Thank you. I have two as well. The first one is on cement pricing. Could you please talk about the markets where you have kind of put in price rises beginning of January or you're planning from 1st of April? Yeah. The second one is on the balance sheet position. You have a strong cash, close to the 2020. I agree that you have paid EUR 144 million of dividend after that, still you have lot of firepower left in it. Do you sense that or are you kind of looking to Brazil as one area where you can probably potentially enhance your position sooner than your roadmap suggest of kind of 2025, 2026? Anything you're planning to raise that stake there? Okay. On cement pricing. In general, again, this year, the outlook is more positive than negative. This is also obviously partly driven from the cost inflation. These CO2 prices are going up very steeply. We started the year, I think, at EUR 30, if I recall correctly, or even less, and we are now at EUR 40 per ton. This is also driving on one side, cement prices, on the other, power prices. The demand is not really exciting, but is either stable or maybe slightly better than last year in general. This should allow a favorable price variance quite widespread with maybe few exception in the market that are tougher or where you may have more input pressure. Let's say that we're not, let's say, too significant on the price trend for the full year. The point is much and versus the cost inflation that is starting to show some clear direction already in the last few months of 2020. On Brazil, well, we have one commitment that is coming up soon. We are in the process of receiving, let's say, the green light from the antitrust authority on the CRH assets acquisition, which will be done by our associate, but actually financed directly from the mother company. This will be clearly a use of cash, obviously something we will see in the range of EUR 200 million anyway, to complete that acquisition, that should come, I think, if not by the end of April, maybe the beginning of May. Not later. By the way, we will see basically the antitrust approval, there is a 30-day period of public, let's call it, comments that can be made. In principle, the antitrust has nothing against it, for the public comments period to expire. Obviously, in Brazil, the other, let's say, commitment that we had refers to the existing 50%, so to the remaining 50% of the existing associates before the acquisition of the CRH assets. There, I don't think there will be an acceleration, or it's not very likely. The put and call option scheme, I think the first period when the seller can exercise its put option will be in 2025. I don't see it very likely this to happen earlier. It may, but particularly if the performance of the business is doing well, is doing better. Since also the price of the option is linked to the performance of the business in the perspective, let's say, of improvement. I do not expect, let's say, our partner to exercise the option earlier. Understood. Thank you very much. You're welcome. The next question is from Zaim Beekawa of JPMorgan. You have the floor. Hi. Thank you for taking my questions. Just a couple on my side. Given the strong balance sheet with the impressive reduction this year in net debt, can you sort of tell us what are the plans for that and whether you would consider sort of any further buybacks? Secondly, back on the topic of carbon, if perhaps I could just ask two questions here, which is one related to Europe and how you see the Carbon Border Adjustment Mechanism coming in place, and what you anticipate that would do to all the free allocations of credits. Secondly, moving to the U.S., what are your views on sort of the potential carbon tax there? Thank you. The first one is on the buybacks. Well, we are submitting, let's say, to the AGM a confirmation, let's say, a renewal of the buyback basically by the same quantity. Let's say quantity doesn't mean necessarily that we will actually execute that, but it's a flexibility that we do have, let's say, in our power. This could be open, could be exercised by the board, in theory, as close as possible to the approval. Anyway, if you look at the trend of the share beside what it is the absolute value, let's say, which anyone can have a different opinion on that. Fortunately, the performance of the share has been quite favorable. I think the investor should be disappointed about that. It could be better, clearly, but we are right now, I think, back again to what was or has been almost the maximum value ever reached by the shares in the past. In terms of lower indebtedness, this is a good problem to have in a sense, because we need to have in mind, going a little back to what was mentioned before on CapEx for CO2 reduction or improvement, let's say, in terms of or roadmap towards carbon neutrality. It is true that this is not coming, let's say, soon. It's not coming in two, three years. It is clear that any roadmap for the industry that wants to really achieve carbon neutrality requires some kind of carbon capture. Carbon capture means. Okay, it depends on the technology. It depends on what is going to be available maybe in four or five years from now. It's something that will be very expensive, not exactly, but almost like adding a new plant to your existing one to be able to capture and especially somehow transport also this CO2. It is true that we are not directly involved in the CO2 quotation, but we don't know how the different countries, et cetera, will deal with that, how much of the CO2 that you produce will you also have to bear the cost of transport and storage, to what extent, et cetera. To have some kind of, let's say, provision or reserve of funds available for this upcoming, let's say, necessity requirement is not a bad thing. On the Carbon Border Adjustment Mechanism, well, we will see how it's going to shape out. There was some disclosure or, let's say, press releases by the European Union. Apparently, yes, this is something that will come. Exactly how and when is not clear. It could be coupled with the elimination of the free allocation, which again, we will not be necessarily better off versus today if there is really no free allocation anymore. The fact is that in some places that are more, let's say, protected, particularly in Central Europe or where you're far from the shore, from the import terminals, the Carbon Border Adjustment Mechanism will not be so necessary. Instead, where it's more necessary to couple that with the elimination of free allowances could be, again, worse than the medicine. We will see. On the U.S. at the moment, no. In the market and in the states where we operate, there is no open discussion on a carbon tax. At the federal level, I did not hear about it yet, at least. That is true that this administration will address this subject in a more, let's say, active way or in a different direction versus the previous administration. We may expect some change. Actually, in the U.S., the main change is something that could already, I don't want to say solve the problem, but improve quite a bit the carbon intensity, is the introduction, let's say, in the norm or some kind of possibilities, again, set by the norm to use lower clinker cement versus what we are using today. If the U.S. would accept, let's say, by norm, in all kind of project and construction sites, including, let's say, infrastructure, et cetera, cement, which is, for example, 80% clinker versus 90% today, this would represent already a big step. Before the carbon tax did that, anywhere else in the world, cement producers are already doing. Great. Thank you. Yeah. The next question is from Yassine Touahri of On Field Research. You have the floor. Yes, a couple of questions. I think, did you give a precise guidance about your CapEx envelope for 2021? I think you just said that it could be above 2020. Do you have an order of magnitude? A second question on your CapEx. You mean total CapEx spending? Total CapEx spending for 2021. Yeah. Okay. Then the second question is that you mentioned that in some markets you might have some pricing pressure because of imports. But we have seen that the freight rates actually have increased quite dramatically over the past couple of months. Do you think that it could mean that your guidance on pricing is conservative, if the freight rates remain high? Then another question just on the magnitude of the price increase. I understand that in the U.S., most of your competitors have announced price increase between $5 and $8 a ton. I'm expecting that more than half of it will stick. Is it the case for you as well, or have you announced different price increases? The announcement by market, let's say, because they are, generally speaking, a regional announcement, usually they tend to be similar. The actual realization on the actual improvement in prices very often is not at the same level as the announcement. Again, I think if the demand stays, let's say, at a good level, like it was, for example, in 2020 or somewhat better, there is a possibility to move the prices up, maybe not by EUR 5, but $5. Let's say, 2%-3% improvement is available. The problem is more on the cost side, as I was mentioning before. Is this going to be enough to offset the cost pressure or not? I already mentioned it, answering the first question, there are some specific situation, some maybe big customer or new customers, et cetera, specific area where not only we will not be able to move up prices, but instead, if we want to keep them, we have to give them quite a significant discount. Again, in line with what I was mentioning before. Higher freight rates, yes, of course, they can have an impact on the imports. They will make them less competitive. Imports or export, let's say, coming from countries like Turkey, like Egypt, et cetera, they are still very much based on a marginal cost, let's say, approach. If you are reasoning on a marginal cost approach, you can absorb. If you want to do it, you can absorb, let's say, a higher freight rate and still remain, let's say, maybe below the market or, let's say, remain very competitive versus the local prices. Right or not, this kind of imports, the reasoning behind it is really on a marginal cost basis. On the CapEx spending, [crosstalk] yeah. Go ahead. Yeah. Regarding is above EUR 300 million. Total versus what we mentioned just EUR 230 million this year. Yeah, EUR 230 million this year. Yeah. How much? EUR 305 million, EUR 306 million versus EUR 230 million. The next question is from Yuri Serov of Redburn. You have the floor. Yeah. Hi, good afternoon. Hello. Yeah. Hi. One question is actually just to follow up on CapEx. I couldn't quite hear the number that you just said. Did you say that it was going to be more than EUR 300 million next year? Yes. Correct. EUR 305 million, I think we have in the budget, versus EUR 230 million this year. Okay. In fact, this is coming from, let's say, carry forward. To a large extent, the carry is coming from carry forward, not really new project approval. Carry forward from the previous year, which were postponed at the beginning of the pandemic. Okay. You are mentioning in your press release new projects that you're planning to realize in order to improve the efficiency of the business. Can you give us a little bit more detail as to what those projects are and how much improvements you're expecting? No, we have some example. Okay. We have one project that is underway, which is, let's say, not really a capacity expansion, but it is associated with the capacity expansion project in San Antonio, Texas, in the plant of San Antonio. This is more environmental, if you wish, at least at the beginning, than efficiency, because it's a new clinker storage. We are still not doing the full year, doing the 12 months, but in some times of the year, some months, we are forced to store clinker, let's say, outside to keep the trade inventory level that we need. With this new storage, we will be able to accommodate, let's say, all the clinker inside. The other is both capacity, let's say, the efficiency important one is the undergoing construction of the new finished cement mill department in Russia, in Korkino. This is probably the most important we have currently underway. This also has an impact on CO2. The new technology, which we will apply, particularly the so-called separator, will allow to produce more than use, but to produce and sell more blended cement. Blended with either slag or limestone and lower the clinker content in cement. We have some projects that are saving CO2 indirectly. For example, also in San Antonio, this is a EUR 14 million-EUR 15 million project for the erection of a new solar farm, let's say, which will be connected, let's say, directly to the plant and will probably represent some 10%-15% of the total energy consumption for the plant. That's also in San Antonio? Yes. This is in San Antonio. Together with the clinker stores, it's actually underway right now. We had already a small portion of the expense charged to the 2020. Okay. Look, obviously, the years beyond the current year are not a focus right now, but just to get a sense, so you have quite a substantial increase in CapEx and some of that is carryover from last year. Yes. Is this the base? Are these projects going to carry on? Are you planning to spend a similar amount in 2022? I know that you don't have a budget, but what's your sense? Maybe a higher amount. No, I think that the maintenance level is likely to stay in the range of more similar to 2019 than 2020. It can be between EUR 260 million-EUR 280 million, including everything. Including also environmental emissions and some project targeted specifically CO2, but not new technology or carbon capture, nothing similar, including CO2 ventures or the common project that we are carrying out in Germany, in Italy for testing carbon capture. On top, there will be something. Usually, there is, and I think that there will continue to be some expansion. Within expansion, I also include maybe the replacement of certain equipment, certain production lines. In the case of Korkino, the finishing department is not really an expansion, but it falls within the, say, the special project category because it's like building, let's say, a new department. Of course, you build a new department and you shut down the old one. You usually have also some improvement in capacity. Okay, just to give you an idea, this kind of project, I think, we will have some. They're not officially, let's say, approved yet, but we will have some, particularly in Korkino, we have the full line already available on the ground, and this could easily translate into a full upgrade of the plant going forward. It would make a lot of sense, both on the, we think, financial side and also the, let's call it, environmental benefits that are associated with it. Okay, good. The second question is completely different. You had a contrasting result in Brazil, EUR 48 million EBITDA last year. You're almost doubling your capacity. What do you expect you can get in that venture going forward? Maybe not this year, but the year after. Can it double? Can it get to EUR 80 million or can it get to EUR 100 million EBITDA at some point? Well, the addition is interesting from the point of view of, let's say, strategic. We think also financial, but let's say initially, at least, it's more strategic in the sense that we will consolidate quite significantly our positioning in the southeast of the country. There are interesting synergies that are coming up from this acquisition, both on the, we think, on the price side, but significantly on the cost side. Particularly logistic transportation. We should have, at least, better prices due to the stronger presence, stronger market share, and improvement on the logistics. In the production cost, the acquired entities are not as efficient as the existing ones. By doubling the capacity, you also double the EBITDA. Unfortunately, this is not the case because these plants are not at the same level. They have a good market position, but not at the same level in terms of, let's say, production cost, et cetera. I think that, if you ask me five years from now, I would say that yes, we have to target something that is double, let's say, the amount of this year. That makes a lot of sense. How this can be achieved, we will see. In part, we know we will understand better when we will be able to manage the company. Yes, can be a meaningful and also reasonable target, of course, with the help of the local market. If the local market performs. If it doesn't, no. If it does. Yeah, pricing is moving quite well in Brazil. If you have more help from prices and security as well. Yeah. It started from a very low level anyway, so there is some room for price improvement, for sure. Okay. Thank you. You're welcome. The next question is from Alessandro Tortora of Mediobanca. You have the floor. Yes, thanks. Good afternoon. Hello. Good afternoon. I have, let's say, five questions. Okay. The first one is related to the outlook, focusing on Italy, because I see that in the first read, it was not mentioned, let's say, the expectation on the operating result. If you, let's say, give us an update? This is the first question. Yeah. Well, Italy is one of the few countries where we should do better than last year. In a sense because we have two additional months almost of production, let's say production in sales. The matrix should finish, let's say, above last year by, I don't know, we will see, maybe 4%, 5%. Pricing is okay. It should be okay also because, again, there is some pressure on the cost side. Besides that, we have, for sure, a stronger market position than we used to have, and possibility, let's say, to influence the price level better than two, three years ago. This is there. We are still in the process of, let's say, optimizing the industrial footprint. We announced officially, if I recall correctly, when was it? Mid-March, approximately, I think, anyway. That we will shut down both Arquata and Testi. It's something that, of course, is painful from the social side of it. We are working on making this, let's say, as easy as possible for the employee involved. On the other hand, it goes into the target, which is always the most important one, to improve capacity utilization level in the other remaining plants, in the plants that we will continue to operate. Cost inflation is pretty high in Italy. Also versus the budget, we are today worse off than what we imagined, let's say, back in October, November. Anyway, we see an improvement there. Okay. The second question is on, you mentioned before that, let's say, cost basically accounted for a positive EUR 45 million, if I remember the bridge that you mentioned during your presentation of the results, including basically energy, fuel, and some other cost that's easy cost. Is it fair to assume that basically you are telling us that the expectation this year is to have, instead of this +EUR 45 million, let's say, putting a minus ahead of this number and then trying to recover as the market allows wood price increase, let's say the most of, let's say, part of this cost inflation? This is basically what you are telling us? I think we are very likely to revert, let's say. Maybe not exactly in the different three or four that were favorable this year versus, let's say, 2020 versus 2019. Overall, if you look at the input-I think we are likely to reach the 2019 level. What we gain this year, 2020, is likely to revert in 2021. Yes, I think. What's going to happen on the price side, is this going to be favorable or favorable enough to offset that? We will see. In addition to that, we have also higher cost for CO2, almost certainly. We will have to bear higher CO2 cost, because the trend is looking quite unfavorable. Okay. On this point, basically, you confirm to us that countries like Germany, but also take the Europe countries, are still purchasing outside their CO2 and Italy will keep its surplus. Is it correct? Yes. Okay. The third question is on, can you help us to get a guidance on financial charges? Clearly this year, the consolidated number was helped by, let's say some no recurring. Also on tax rate, 20% tax rate for two years in a row, it's a good result. Maybe if you can give us an idea, okay, going forward. Thanks. On financial charges, right now, we have a budget of around EUR 29 million budget here. This is usually, it does include some potential non-cash items, but that we can anticipate. It's more, let's say, a reflection of the actual cash net interest expense. On the tax rate, I think we are probably similar because just a second. That's correct, of course, yes. Normally, you were asking about the rate, no? Yes, it's a normal, let's say, tax rate, considering let's say, sustainable level, okay, for this year. Yes. The budget is between 2020 and 2021. No difference. Unless Joe Biden decides to raise the tax rate in U.S. It should be similar. If the administration returns to a tax that means that you should get infra spending, okay so it wouldn't be negative. The last question. Yeah, please. The last question is a topic on, let's say, medium term, in the sense that as you mentioned before, clearly a significant CapEx related to the rearming CapEx, CO2 capture is still, let's say, not there because technology is not commercial, and this is clear. The question is, the company is already starting process or when the company started to map all the production plants in order to assess where it is economically feasible, okay, to put in place a CO2 plant? We have some companies already focusing on, let's say, big plants justifying the investment. Yes and no. In a sense, it's very difficult. I mean, very important, but also very, I would say, difficult exercise that requires a lot of investigation. I think the process will be more, let's say, first step to understand, like you were mentioning, which technology is the most, or which one or maybe two, three technologies are the most interesting to be introduced. Then, of course, depending on the technology, maybe a plant would be more suitable for a certain technology. This is the exercise we have to make. I think, yeah, it's not that we are not involved in this reasoning, but for the moment, I think it's very preliminary because it also come to the conclusion tomorrow, I don't know. To give an example that you need to get closer to the existing or to what is planned to be an existing storage. In this case, you not only are in the need of adding the capture technology to an existing plant, but you will have to build an entire new plant just to get closer because it could be from a financial, economical outcome, better than introducing carbon capture technology on-site, and then transporting maybe 200 km, 300 km for the storage. What is likely to happen, in my opinion, is that in general, you will have less cement active. You will focus clearly on few plants, except, of course, higher logistic cost, higher transportation cost for distribution of cement and, yes, introduce the capture technology in a limited number of plants that are The one that for position, I don't know, raw materials, whatever, they are the ones that are more likely to be, let's say, to a long life also beyond, let's call it, the 2030, 2050, et cetera. We should not rule out maybe the possibility. Because in some older plants, you may also have some difficulties in introducing this kind of technology. You may be in the need to build a completely new one. I think tomorrow, today, the closeness to the raw materials is one of the main requirements when you build a plant or when you are using a plant. The life of your quarry, et cetera, is one of the main requirements. Maybe this will not be the main requirement. Maybe tomorrow, it will be more important how far you are from a carbon storage or carbon usage plant. No. Okay. It was a question, but I know that basically, the right answer now is I don't know, but thanks for, let's say, giving me some details, okay, on that. Thanks. Okay. The next question is from Cedar Ekblom of Morgan Stanley. You have the floor. Thanks very much. I have three questions. Okay. First thing, can you tell us what your utilization rate is in the U.S. at the moment? Secondly, can you tell us what you have budgeted for CO2 costs in 2021, and if there's a specific price that you are linking your budget to? Thirdly, on decarbonization, I don't want to talk about carbon capture storage, because I agree with you that there's a lot of unknowns on the topic, and the economics currently don't make sense. However, t here are a lot of things that your competitors are doing related to fuel mix, energy efficiency, and the introduction of lower carbon products utilizing recycling, as an idea. Can you talk about what you're doing on those other initiatives? Not carbon capture storage or use. Yeah. What is your strategy on the low-hanging fruit on this topic? Where are you in the decarbonization strategy? Ultimately, this is a massive issue for the industry. It would be great to get some granularity on where your strategy is on those other topics. Thank you. Okay. Sure. In the U.S., it is slightly different from region to region. Let's say that overall, we are currently at 92%-93%, say above 90%. Of course, to achieve 100% is a nominal capacity, but sometimes difficult to achieve because, of course, you need some weeks of the year for the maintenance program. When you are running, let's say 96%-97%, versus the nominal on 365 days, let's say, usually is what we consider an extremely good performance. We have some room. If we move, and this is part of your last question, like we will, towards maybe lower clinker cement content, lower clinker cement ratio in the U.S., which is clearly one of the main directions. This should help in the sense of having more capacity, because then in this case, the bottleneck or the constraint is going into the grinding, into the finished grinding, not so much in the kiln. Okay. On the CO2 cost, I think we are EUR 30, EUR 30, EUR 31, right? Should be in the cost, yes. EUR 30.5 for the budget, this is an average for the full year. We will see. It could be more. Could be one of the potential negatives, let's say, or risk, let's say, for the budget. This is also why we tend to be a little cautious on the full year outcome. On decarbonization, I would suggest two things. Okay, Patrick, if you want to add something, of course you can, but I don't think this is the occasion to enter into some very detailed, let's say, project. We are no different from what the other companies are doing, actually. It is clear that if you want to achieve a certain result, the step action that can be taken are the same for the entire industry. I think we are, in general, maybe ahead versus some others in some of the action. Typically, for example, the usage of alternative fuel. On average, in our group, we have a better level, a higher level versus most, if not all the other data groups. Maybe we are not as good in blended cement, like you're saying, but this is mainly associated with our in the U.S. and the fact that the U.S. that represents, let's say, in terms of result, production, not exactly. Let's say 50% of our business, they are still subject to some certain market rules that require a very high clinker to cement ratio. I would suggest again, maybe go our sustainability report, which will be available, let's say, soon before the AGM, which is very, I think, very detailed. It's the most valuable and most comprehensive information that you can find on this specific from our company. And then I think we have a plan anyway on It will be likely- April 27th, there will be a conference on project Italcementi w ith the AGM. You can maybe then join the conference if you will. In this case, we will prepare a specific presentation on this subject. I think this will be a better opportunity to discuss. Thanks. Can I just follow up one question on the budgeting for CO2? How many contracts are you planning on purchasing this year? Do you think that you have enough inventory considering you did purchase quite a lot last year? So, when you were just thinking about EUR 30.5 per ton, what is the sort of volume reference that we should be thinking about? Have you got a sort of range of contracts that you may think of purchasing in the market? I think it depends very much, of course, on the CO2 price. If we wish to not to transfer between two companies, it's below 1 million tons of CO2 that would be requested by some of the countries. The purchasing that you did last year largely covers you this year, is the message? Yes. Yes. There's a big part covered. Yes. Yes. We purchased almost 1.5. Okay. That's very helpful. Thank you. Yeah. The next question is from Mike Betts of Data Based Analysis. You have the floor. Thank you very much. I have two questions, if I could, please. Yes. The first one, you referred to delay of some maintenance CapEx, from 2020 into 2021. You talked about the CapEx element of that. Presumably, when you normally do a maintenance CapEx, there's an OpEx element as well. Presumably the profits in 2020 benefited from some of that maintenance not occurring. Are you able to quantify roughly what that benefit was? Is it particularly large in any of your countries in relation to their size? That's my first question, please. Yeah. My second question is just on oil well cement. I think there was quite a significant reduction in demand in 2020. Are you able to quantify how much that might have hit profits? Probably more importantly, could you just talk about, with the high oil price now, are you starting to see that demand return? Thank you. Okay. Well, yes, you are right, in a sense that very often this sort of major, let's say, at least, maintenance project, they include both some items that are being capitalized and some other that are operating expenses. I think that the two countries where we had delays or postponement, the most important one was the U.S. This was strictly related to because we were unable to, let's say, bring the people in the plant or the number of people required to work in certain project in the plant. The amount, I think in the U.S., you can assume like maybe EUR 5 million, rule of thumb rough time. Also in Italy we had some postponements. There were some projects that we were planning, for example, during the period of the lockdown that we could not really carry out because everything was shut down. In Italy it's a little less. It could be half of that, let's say between EUR 2 million and EUR 3 million. On the oil well cement, on the real profitability decline, we don't have a really clear answer. No. At the end, yes, it is true that the oil cement is priced higher, but is also much more expensive to produce. You have a greater, let's say, logistic cost because you move it, particularly in Russia, in very longer distances. If we look at the most recent data. There is not really yet recovery visible, at least the two countries that are more, let's say or three countries where we have a significant volume of CO2 are Germany, Russia, and the U.S. In Germany, we are behind for the moment. In Russia, we are better. Russia has somehow improved, but Russia is going a little bit its way. They tend to produce more, that's not necessarily linked to the oil price. This is improving. In the U.S. we are down versus last year. The two countries that are a little more market driven are still below last year level in a evident way. Russia is doing better. Don't know if this answers your question. The next question is a follow-up from Paul Roger of Exane BNP Paribas. Please go ahead. Okay. Yeah, sorry, gents. Just very quickly, did I hear you correctly and you said you would have a CO2 investor day on the 27th of April? That's my only question. No. The topic will be project initiatives of Italcementi regarding climate change activities. Perfect. Thank you. The next question is from Gregor Kuglitsch of UBS. You have the floor. Well, hi, thank you. Hi. Sorry, one is a follow-up question, and I didn't quite catch the total energy bill that you incurred last year. I think you were saying you expect it to increase, give or take, but at EUR 40 million-EUR 50 million that you gained last year, if I understood correctly. Can you just repeat what the actual bill was? And, w hat the assumption in the budget is, please. Yeah. Last year, 2020 total was EUR 295 million. 2019 was EUR 357 million. This is fuel and power. Purchase, let's say, directly for the cement business. Does not include, for example, I don't know, diesel that you purchase for the mining extraction. For sure. Anyway. So, yes. The advantage that we had this year, overall input cost, so not only fuel and power, was approximately EUR 45 million. Not too different. Let's say, clearly fuel and power went down more. Other input costs, like raw material, did not go down. That's why you had smaller, let's say, improvement at the EBITDA level. Yeah, I think the offsetting or the reversal could be more or less of this range. Not very different. Okay. Thank you. That's helpful. The other question is, if you could share any color, the first quarter's almost done. It's the 25th of March. How things have gone so far in the new year? I know that there's obviously some weather issues in Texas, overall, are you tracking in line with your guidance? Are you being down or is it more forward-looking? I appreciate Q1 is a bit small, but still. Okay. If we look at the end of February, I would say we are down. The reason, as you mentioned, also in Europe, quite cold weather difficulties, very cold weather in the U.S. stopping, let's say, almost not the entire nation, but large part of the nation for more than a week. March so far, we will see by year-end. We also do not have, let's say, the only week in March this year, it's advantageous. We have, I think, one more working day, generally speaking. March, the business is going normal. Let's say it's picking up. I think it is maybe recovering what we lost in February. The first quarter is always quite volatile anyway. No reason, I would say, to think that we are more negative than what we mentioned in the outlook, which is driven, again, mostly by caution, by negative Forex and these kind of factors. Okay. Thank you. The third question is maybe more strategic, and it's on capital allocation and the balance sheet structure. Your company has been generating, sort of before dividends and investments into acquisitions, somewhere, I don't know, EUR 300 million, EUR 400 million of annual cash. Right? That's at least the last few years. Your leverage is virtually nil. It's less than 0.5 of the term. What do you think is appropriate for the company, and at what point do you kind of need to do something about it? Either invest it or return it to shareholders? We have to do both. Probably a return to shareholders can improve in, I think, again, more in the form of dividend than buyback, because it's somehow easier and also more flexible, if you wish. Investments, we have some commitments, let's say, that are certain, that will basically the ones that are about Publica, the Brazilian, let's say, vision and also the Brazilian change in the ownership come in few years' time from 50%- 100%. For the rest, I think that anyway, beside what it is the requirement for the, let's call it carbon neutral. The two things actually are going to some extent or to a large extent together. We need to continue to focus on the existing, to make it possibly better. It is clear that in this time, since, let's say, the adoption of new technologies for carbon capture or the potential that they have of changes that will show after in the future or the need to adapt your investor structure. We know that is coming, but we don't know exactly how and when. I think there will be some years where, beside, again, the requirement, efficiency improvement, et cetera, we may remain in a position where we would prefer, let's say, to keep some money, some reserve in the company to be able to face any kind of, let's call it, carbon neutrality. Instead already, like you say, return too much capital to the shareholders, because otherwise, we may be then later in a position where, I don't want to say that we need to ask money to the shareholder, but let's say to find the right balance between, there should be a decent normal return, at the same time, preserve the capital in the company for the uncertainties and the challenges that are coming up and are not clear exactly right now. Maybe we need four or five years' time to understand exactly what we need to do, where we need to do it, how much it's going to cost, et cetera. This is the way we are thinking about it, at least at this time. Okay. In addition to that, and appreciate it. Ba sically, what you're telling us, you're going to be running very low gearing until you have more visibility on what carbon capture, et cetera, may cost you. Yes, I think it would make a lot of sense. Yes. Okay. Then in terms of additional acquisitions, obviously, Brazil is now becoming sizable. Maybe that's kind of done. What about other expansions? Really more on the agenda things? Again, more opportunistic. It's maybe less in the agenda than it was in the past sometimes, at least in our mind, because then, if you have something targeting or a clear strategic idea in your mind, then not that all the components are really coming together. Anyway, interest in this case, we are more focused to the, let's call it, minorities. Okay, Brazil has its own action, its own path that will actually come to a conclusion. We have other positions that are also important in the minority stake of companies that are very good performer, that would make, let's say, a lot of sense within our group. If there is a possibility there to gain majority, I think this is something that we would get very close. Okay. Mexico, I guess. Okay, fine. That was it. Thank you. I appreciate it. Okay. Thank you very much. Have a good evening. Yes, sure. Thank you. As a reminder if you wish to ask a question, please press star and one on your telephone. For any further questions, please press star and one on your telephone. Mr. Buzzi, there are no more questions registered at this time. Okay, thanks everyone for listening. We already mentioned this next appointment that we are organizing for one month from now. I don't know when, but we hope to see you in face in personal meeting sometime soon at least sometimes in 2021. Again, good evening.