Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Carel 2021 first quarter results conference call. As a reminder, all participants are in listen-only mode. After the presentation, there'll be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Engineer Francesco Nalini, Chief Executive Officer of Carel. Please go ahead, sir. Thank you. Good afternoon, everybody, and thanks for joining our call for the presentation of the first quarter 2021 results. As usual, I'm starting from page two with the main highlights. We are delighted to report in this first quarter of 2021, the highest quarterly organic growth rate ever reached by the group in the last 10 years. This is both compared to the first quarter of 2020, and as well as compared to the first quarter of 2019. Since in the first quarter of 2020, our sales results were basically in line with the previous year. Revenues grew by 24% in the period compared to the first quarter of 2019, or 26.9% excluding the foreign exchange effect. We had an acceleration in results in all regions and in both markets, confirming our expectations of an acceleration of the positive trends that we had in the second half of 2020, compounded with a recovery in the most cyclical applications like HVAC industrial. For example, in automotive, we have more than 30% growth, as well as a recovery in food service, where we reported a double-digit growth rate. This confirms the capability of the group to be not only very resilient, as shown in 2020, but also capable of seizing growth opportunities in the context of an accelerating demand scenario. EBITDA margin was 22.5%, up 280 basis points on the full year and 430 basis points on the first quarter of 2020. This excellent result was, of course, driven by operating leverage as well as the continuous deployment of the initiatives to contain operating expenses that we started in 2020. The net financial position improved by 9%, where the free flow from operations of approximately EUR 20 million, easily covering EUR 12 million of expected increase in net working capital and approximately EUR 2 million in CapEx. As we will see, net working capital increased mainly for a seasonal effect in receivables, which happens every first quarter, as well as an expected and wanted increase in inventory to cope with the global shortage of raw materials. Now moving to page three with some more figures. Revenues were EUR 97.6 million, up 24% from the EUR 78.7 million of the first quarter of 2020. As we can see in the chart at the top right, growth was 21.9% compared to the first quarter of 2019, since in the first quarter of 2020, revenues were basically in line with the previous year. This confirms our expectations again for a strong acceleration in demand, confirming the trends of the second half of 2020, plus a recovery in the other more cyclical applications. We saw an acceleration in most applications and all geographies, confirming the well-balanced product and application portfolio of the group. EBITDA grew by 53.2% to EUR 22 million, up from the EUR 14.4 million in the first quarter of 2020. This represents 22.5% of sales thanks to operating leverage and the cost containment measures. This also discounts approximately EUR 1.3 million of lost EBITDA due to the negative effect of the foreign exchange. Net profit at EUR 13.3 million was up 75.5% from the EUR 7.6 million of the first quarter of 2020, thanks to the operating results, while the tax rate was basically stable at 19.4%, in line with the 19.3% of the same period last year. Capital expenses at EUR 2 million were in line with the EUR 2.4 million of last year. Of course, most of the capital expenses expected for 2020 are still to be incurred. I'm now moving to page four with the revenue breakdowns. To the left, we can see the breakdown by region. All regions accelerated and reported exceptional results. EMEA, net of the foreign exchange, grew by 22.1% with a very good result both in HVAC and refrigeration. Asia-Pacific grew by 47.3% net of the foreign exchange. This is due, of course, to an especially good economic performance of China, whose GDP grew by 18.3% in the period, also to the execution of our strategy to grow the market in the region. In China, we had a growth well in excess of 50%, also the rest of the region improved dramatically. In North America, sales grew by 29.9%, net of the foreign exchange. This is thanks to a recovery in the market conditions, also thanks to better execution since last year we changed the leadership in the region. Latin America grew by 62%, net of the foreign exchange. Of course, here we discount a very negative effect of the currency in EUR. Even in EUR, we grew by almost 30%. We had a good result both in Brazil and in the rest of the region, driven by cross-selling and upselling in food retail, as well as actions to increase prices. If we look to the breakdown by sector to the right, we can see that both markets accelerated. HVAC grew by 27.2%, net of the foreign exchange. We saw an acceleration in heat pumps and data centers, and also a strong recovery, as expected, in the more cyclical applications like industrial and, for example, automotive. While commercial HVAC is rather flat-ish in this period since players in Europe are waiting for the detailed execution of the Next Generation EU program, but this represents an upside for the future. Also, the wellness application is still suffering a little bit. In refrigeration, we grew by 28.4%, net of the foreign exchange. In food retail, the market share acquisition that was present already in 2020, and that is due to the end user promotion strategy that we are executing, is compounded by the expected recovery in the investment cycle at the end market level, achieving an exceptional result. Also, the food service segment is improving, and we are achieving a double-digit growth there. I now leave it to Nicola to comment the items below the EBITDA. Thank you, Francesco. Slide number five details the group result from the EBITDA to the net profit. The first quarter 2021 was impacted by D&A pretty in line with 2020 level. In the period under review, the financial charges were higher compared to last year due to the increased amount of loans available for the group. The Forex impact in Q1 2021 was negative for around EUR 500,000, compared to a loss for more than EUR 300,000 realized in Q1 2020. It was mainly related to the group operations in Brazil, Croatia, and China. The tax rate of the period was pretty in line with the first quarter 2020. The group net profit of the first quarter 2020 was equal to EUR 13.3 million, compared to EUR 7.6 million of the same period of 2020. Slide number six shows the net financial position evolution of the first quarter 2021. The net financial position was improved compared to December 2020 level, reducing from EUR 49.6 million- EUR 44.9 million. Taking out the accounting effect of IFRS 16, the net financial position with banks amounts to EUR 17.4 million. The flow from operation was equal to EUR 18.1 million, higher than CapEx and the increase in the net working capital of the period. The increase in net working capital was mainly driven by a strong growth of revenues to a planned increase in inventory to better cope with the raw material shortage and to a seasonal effect in accounts receivables. It should be noted that the DSO at the end of the quarter improved compared to the same period of last year. At the end of December 2020, the group has an amount of cash equivalent, and available credit lines for more than EUR 100 million. I leave the floor to Francesco to go on with the presentation. Thank you, Nicola. I'm on page seven. To summarize, in this quarter, with this exceptional result, the highest organic growth rate reported in the last 10 years, both compared to last year as well as compared to 2019, we confirm not only the strong resiliency of the group that we have shown in 2020, but also the capability to seize growth opportunities in a market of growing demand. In fact, demand was pretty positive. As expected, we saw the acceleration of data centers, heat pumps, as well as the recovery of the more cyclical applications like industrial as well as food service. In food retail, the market share acquisition was compounded by the expected recovery in the investment cycle, also facilitated by the new F-Gas milestone in Europe. In terms of operations, last year, we started working after the start of the sanitary emergency. We started working to increase our resilience, which was already very high, and we started a number of actions. We deployed 12 new production lines between Croatia, U.S., and China. We are moving our double sourcing strategy to a double country source strategy, and we are homologating a big number of new alternative components also to cope with the shortage. Our R&D is very much engaged in this activity, and we are homologating alternative components also where technically it's not so easy, like, for example, for microprocessor. This is helping a lot in coping with the shortage. We also started to increase the inventory to cope with the shortages. To conclude, taking into account the excellent results reported in this quarter and the positive indications coming from the current order intake, without any further worsening of the global raw material shortage or the current COVID-19 scenario, we expect to maintain a double-digit revenues growth rate for the full year with a floor of 12%. Before leaving it to your questions, I would like to comment on page nine on the deal we signed late last night for the acquisition of 51% of CFM. CFM is a longstanding partner of ours based in Izmir, Turkey. They are a distributor of ours, but they are much more than a distributor, since they have a very distinctive business model. They take technologies from us and from other leading manufacturers, and they create high value-added engineering solutions with a very strong technical content and a very strong content in terms of services, both on-field and digital. This is reflected in the very high profitability of the company, which is well above 30%. Last year, they reported revenues of EUR 14.5 million and an EBITDA of EUR 5 million. They are protected from currency fluctuations since they sell in euros. They are very strong in the food retail market. They have strong and long-lasting relationships with end users to whom they provide on-field technical and digital services. Approximately half of their 34 employees are technicians, engineers, and software developers, so they're a very strong engineering company. The industrial rationale of the acquisition fits several guidelines that we have. It's a bolt-on, it's a footprint expansion outside Western Europe, and a platform for the Middle East, and it's a strengthening of our knowhow in digital and on-field services. The sales that we currently make to CFM amount to approximately EUR 2.5 million. The valuation of the company is nine times the EBITDA, and for the remaining 49%, there are cross call and put options to be exercised between 2024 and 2027, with evaluation according to future results. We believe we can create a lot of value with this transaction. The closing will take place after the approval from the authorities. We can create a lot of value thanks to the high profitability of the company, thanks to its service and engineering capabilities, thanks to the possibility to grow in HVAC, since so far CFM didn't focus on HVAC, but just on food retail, and it's also a possible platform for expansion in the Middle East. Thank you very much for your attention. I now leave it to your questions, and we are more than happy to answer to all of your questions. Excuse me, this is the CAREL's 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 your question, please press star and two. Please pick up the receiver when asking questions. The first question is from Will Turner of Goldman Sachs. Please go ahead. Hi, Will. Thanks for taking my questions. I have three or four questions. I'll ask some of them. I can go back to the end of the queue. My first question is, you've now given some guidance for the full year or indication of guidance. Relating to that, first one is, does that include the impact from CFM? I know it will be relatively small. That's the first one. The second one is, how do you expect profitability to develop for the rest of the year? Obviously, a very strong quarter in one Q. Some of the headwinds that you talk about in your release, they shouldn't really be starting to impact until now. Are you wary to give a profitability guidance? How do you see the profitability developing over the next couple of quarters? Thanks for the questions, Will. Okay, no, the guidance doesn't include the impact from the consolidation of CFM. In terms of profitability, you rightly say that the big impact in the possible increase of cost related to the shortage will be seen in the rest of the year, you're right. We expect possibly an average increase in the cost of raw materials in the low single-digit range. Of course, we're taking countermeasures to mitigate that, like for example, actions on prices. The impact will be material but not huge. We're not concerned about profitability. However, there is uncertainty, it's not easy to provide the guidance for the full year at this stage. Let's say that considering also that we're investing heavily in digitization and we have to support this very strong growth rate, if we revert to our mid-cycle expectation for profitability, which is 19%-20%, we expect that probably for the full year, we will be in the high end of the range. We can be more precise at the presentation of the half year results. Great. I suppose on the guidance of 12%, you've obviously started this year. The 1Q, very strong. 2Q should be a good quarter as well, because the comparative is not as strong either. Do you not feel that maybe 12% might be quite easy to hit? Is it still, do you think there's too much uncertainty to really be more precise? Where do you think an upper limit could be? If that's a different way of wording it. Okay. Let's say that in a scenario which remains very uncertain for a number of reasons, we prefer to be on the conservative side of the guidance. 12% is the floor, is the worst case scenario in the current condition. We prefer not to be more precise at this stage. We'll be more precise again at the half year considering the higher certainty related to the shortages of raw materials. Again, 12% is a conservative floor to our expectation, and we prefer to maintain it like that at this stage. Okay, that's fine. Final question, you kind of alluded to it. Do you intend to increase prices? I know this is something that you usually don't do. Has there been any price increases already in the first quarter? I assume these will be low single digit price increases. Kind of also related, I guess. Is there any particular component which you're concerned about in terms of tightness in supply? It seems to be, for example, electronics and semiconductors in particular are causing issues for a lot of industrial companies. You don't see any one particular component which is going to potentially cause headaches later in the year? Okay. As far as the prices are concerned, we did the price list increase already at the beginning of the year. In some specific regions, we took stronger actions also related to the currency. For example, as I mentioned during the presentation in Latin America. For other customers, we are forced in several cases to raise prices to reflect the increases in input costs. Yes, we are taking actions on prices. As far as the raw materials are concerned, basically the critical situation is more or less across the board. Most categories are affected. As I said, we started at the end of last year to take a number of very strong countermeasures in terms of inventory, in terms of additional production lines, and especially in terms of homologating alternative components. Our R&D has been strongly engaged in the last few months in these activities to homologate alternative components, and this is definitely helping a lot to cope with the shortage. Fortunately, our supply chain was already pretty resilient to begin with. Already at the beginning of the pandemic, before the shortage, we started to increase the resiliency, and these actions are helping. Of course, the situation is not easy and is uncertain, but we have strong countermeasures in place. Great. Thank you. The next question is from Alessandro Tortora of Mediobanca. Please go ahead, sir. Yes. Hi. Good afternoon, everybody. I have four question, if I may. The first one is on the top line trend. The guidance you mentioned, let's say clarification, first of all, that you're talking about, let's say, at least the floor at constant FX, okay? Which clearly is a non-important factor for you this year. The second question is on the regional outlook, because we read in this month, U.S., but even China, focusing much more on, let's say, the switch, okay, from the synthetic refrigerants to the natural refrigerants. The question is, can you share with us, the growth potential you see in areas like the U.S. or China, considering that at least in the U.S., penetration of natural refrigerants are quite low? In the past, we saw refrigeration independently from this year, growing, let's say, mid-teens. What I would like to understand, let's assume the addressable market is getting larger. Which sort of size, which sort of potential you see, okay? Also considering that we are going beyond Europe with the U.S. and China. This is the second question. The third question is on, let's say some application, because you mentioned before heat pumps as a top performer. Can you elaborate a bit more on that? Just sharing with us an idea of the underlying trend of heat pump, okay, for you. The last question is on the margin. I understood that the historical track record was 19%-20%, but considering the Let's say exceptional trend, but also some, let's say, carryover of some cost efficiency action you made. Honestly, I thought that the company would have been able to be at least this year, about 20%. Maybe it's a one-off. I would like to understand better why you still see a range of around 20% this year as EBITDA margin. That's it. Thank you, Alessandro, for the question. First one, the clarification, the guidance on the top line is in current FX, not constant. Of course, it discounts a negative foreign exchange effect. Concerning the regional outlook, yes, we had several good news in terms of regulation, both in China and the U.S. They both ratified the Kigali Amendment. In the U.S., there is a strong push for the transition to lower impact refrigerants. The outlook is definitely improving, as we had expected, by the way. The growth potential is definitely improving. This was, let's say, something that we were waiting for. We were thinking that it was going to arrive. Of course, it translates into a very strong outlook for the growth in the medium term, that we expect to remain, let's say, solidly midterm, in the double-digit organic growth region, both in China and the U.S. Also, thanks to execution. In China, the very good result we're having is not only because of the good economic performance of China, but also because we are executing a strategy of end user engagement more and more, and also in North America, we are improving execution. Let's say that midterm, again, we expect to maintain a double-digit growth solidly, thanks to this improved outlook that we were expecting. For the heat pumps, let's say, the heat pump has secular, very positive growth expectations because, in this moment, it's the most sustainable way to heat buildings. It's considered a renewable. It's consistent with electrification, with the reduction of emissions. It's, let's say, subsidized directly or indirectly in many countries. Definitely the growth expectations for the application are very high in the medium term. I have to remind that we don't work in heat pumps in general. We just work on the top tier of the segments, in the most efficient high technology segment of the application. In general, in terms of outlook, a very positive development will be, and it's starting to become significant, the evolution towards natural refrigerants also for heat pumps. Natural refrigerants, so far, have been mainly related to refrigeration. Now they are starting to develop also in HVAC, and heat pumps especially are now starting the transition towards natural refrigerants, which is another very interesting development for us. The growth results we are having are, of course, related to this very strong underlying trend, but also to our activity, of course, of market share increase, but also of cross-selling to customers, because we are increasing the share of wallet we provide to our customers in the heat pump segment to provide more value. For example, with variable speed compressors as well as electrical panels to increase the share of wallet in each unit. This is also compounding the growth we're seeing in the application. As far as the margin is concerned, let's say, our margin is very much related to operating leverage. Since we have uncertainty on the top line, the uncertainty is even higher on the bottom line. That's why it's not so easy to provide a precise guidance this year. The potential to arrive at more than 20% is for sure there, but let's say it's difficult to be sure at this stage. We will definitely try to be more precise at the presentation of the half year. Let's say a follow-up and another question. The follow-up is, considering, let's say, and hoping that these, let's say, first quarter with a run rate of revenues, let's say, above EUR 90 million per quarter is sustainable, as we are discussing now with the, let's say, new trends. In theory, we could assume that at least 20% EBITDA margin going forward, considering the high utilization rate of your capacity, could be, let's say, sustainable. Okay? This is a follow-up. The other question is, on M&A, you commented before, the deal on distribution plus, let's say, service. Is the company still assessing, let's say, some other potential targets? We have to think about, let's say, this is the deal for this year, and just understand the strategy on M&A for the current year. Thanks. Okay. Let's say that, again, talking about the profitability, your first question. Yes. Profitability is definitely related to the operating leverage. Let's say that if the assumption midterm that we have a profitability in the range of 19%-20% is related to an organic growth rate in the high single-digit range. If the growth rate in sales is higher, also profitability would be in the higher end of this range. We won't change in this very moment the midterm expectation. In this very moment, we maintain our midterm expectation of high single-digit organic growth rate and profitability between 19% and 20%. Should we see the potential for a higher expectation for our organic growth rate, that of course will translate in a higher profitability for the midterm. Of course, at the same time, please consider that we want to invest to sustain and accelerate the growth of the company. Many resources we get from the growth are invested in digitization, in strengthening our footprint, in innovation, and so on. Again, our target is to grow sales more than to grow profitability. That's our idea in general. Concerning the CFM, we are still active in this moment. We still have an active pipeline. We are still working, let's say, pretty intensely on M&A. We don't believe we have finished our activity for this year. Of course, we don't know if we can finalize anything else, but we will try. Okay. That's answered. Engineer Nalini, there are no questions registered at this time, sir. Okay. Thank you very much. Thank you for your attention and for your questions, and looking forward to speaking with you again for the presentation of the first half 2021 results. Have a good afternoon. Bye. Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.