Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Aquafil Group first half 2024 results web call. As a reminder, all participants are in listen-only mode. After the presentation, there will be a Q&A session. For operator assistance via web call, please press the headset icon on the bottom left side of your screen. For conference call assistance, please press star zero on your telephone. At this time, I would like to turn the conference over to Ms. Giulia Rossi, investor relator of Aquafil. Please go ahead, madam. Thank you, operator. Good evening, everyone, and welcome to Aquafil investor conference call. Today, we will update you on company's first half 2024 performance. Before going ahead, let me remind you that this presentation may contain certain statement that are neither reported financial results nor other historical information. Any forward-looking statement are based on Aquafil's current expectation about future events and are subject to risk and uncertainties that could cause results to differ from those expressed by the statements. For a discussion of this risk and uncertainties, you should review the disclaimer in the presentation we issued today. I will now leave the floor to Mr. Giulio Bonazzi for his remarks. Thank you, Giulia. Good evening to all, and thank you again for attending our video conference. The first half of the year remarked the steady and continuous improvement of the group, which is now close to returning to ordinary profitability. As usual, the various product lines and geographical areas showed different dynamics. Polymers and fiber for carpets, with the exception of the United States, reported a progressive recovery, while fibers for garments continued to show some weakness. EMEA, after showing significant weakness last year, recorded a recovery in volumes of fiber for carpets. Asia-Pacific also saw a positive trend in volumes, while unfortunately, the U.S. market represented a negative surprise, contributing to the reduction in overall profitability. In the United States, both fiber product lines recorded volumes below expectations in the first half of the year, although BCF showed improvements in the last weeks. We expect better results in the second half of the year, and especially in 2025. In relation to costs, the actions aimed at personal rationalization and at the optimization of working capital are essentially finalized and are generating the expected results. With regards to the second half of the year in EMEA, a recovery in the market of fibers for garments is expected. As for fibers for carpets, volumes are expected to remain in line with the first half of the year. Polymers continue the announced growth path. In the United States, the second half of the year is expected to show a slight improvement in both product lines compared to the first six months of the year. In Asia-Pacific, the volume trend is aligned to current year budget estimates. In light of the improvement of the company's economic and financial situation, in order to accelerate its growth process, the company has approved the new 2024, 2026 three-year plan. We want to be ready to seize the growth opportunity that arise in this unique period and aim to strengthen our positioning with a capital increase. Thank you. We are now ready to welcome your questions. This is the conference call operator. We will now begin the question-and-answer session. To enter the queue for questions, please click on the Q&A icon on the left side of your screen, then press the Raise Your Hand button. Please do not mute your microphone locally, and when prompt, make sure you turn on your webcam in the pop-up window. If you are on the phone instead, please press star one on your keypad. The first question is from Dave Storms of Stonegate. Please go ahead. Hello, thank you for taking my questions. I have two questions, in relation to the press release that you put out today. The first one is with regards to the North American market and just kind of what you're seeing, as far as turnaround activity there. The second question is with regards to the CapEx spending that you're expecting over the next two years. The press release mentioned significant technical improvements. Just any more color you can give us on what those improvements will hopefully look like. Thank you. Well, thank you, Dave. In reality, in the North American market, we suffered a temporary loss of volumes driven by the early termination of a contract that was in line, let's say, working between Aquafil USA and a local player who last year, given the weakness of the residential carpet market, has asked to terminate the contract earlier than scheduled. In line with our budget expectations, we decided to welcome this request by the customer. Also considering that if we didn't accept it, next time they would have never asked for the same kind of support. Honestly, we were expecting a better demand coming from the automotive sector, as well as also a quicker recovery from the switch of INVISTA product lines to Aquafil's product lines. Clearly, the automotive market, as it is known, has not performed so well, even if recently we are seeing some slight improvement. As well as the expectation of the switch between INVISTA and Aquafil product lines has taken a bit longer, but is now finally taking place. Also, in the meantime, another local player, namely Ascend, has announced publicly that they will stop BCF production at the end of 2024, giving, of course, the remaining two companies operating in the North American market, the possibility of gaining further sales. This is why we are relatively, let's say, optimistic for the next year. With regard to the CapEx spending, let me tell you that in a few days, we will have a session when we will present the new guidance for 2024, as well as the business plan for 2025 and 2026, where we will give, let's say, our projections and also our ideas with regard to eventual further investments when the capital increase will be realized. Nothing, let's say, super large or dramatic. There are some CapEx that we are holding since, let's say, 12 or 18 months, waiting for the return to a better ratio between our EBITDA and the net financial position. That are giving extremely interesting results, and we would like, of course, to start making these investments as soon as possible. The next question is from Amit Dayal of H.C. Wainwright. Please go ahead. Mr. Dayal, your line is open. Hello. Can you hear me, guys? Okay, thank you. Thank you for taking my questions, guys. You are expecting some volume recovery in 2025. Can you talk a little bit about what are the drivers to support those expectations? Yes. Well, let's start from the easiest, which is Asia Pacific region, which has always shown a positive trend since we started operating there in 2007. We are expecting some better, let's say, revenues and better sales because we are going to introduce a special technology that was not available in Asia Pacific yet. We were operating this technology successfully in Europe and U.S., and we are now going to implement this technology in Asia Pacific in order to follow the local growth of the commercial and automotive industries that are the two main, let's say, final market for our carpet yarn activities. With regard to Europe, we are expecting a consolidation of the European or the so-called EMEA market. Clearly, last year, we have suffered, especially during spring and summer, a very big downturn that this year has not taken place, but we expect a slight improvement also, again, deriving from the announced stop of production of another player here in Europe called Nilit. We are not, let's say, dreaming for a strong pop-up or recovery of the market, but we are just, let's say, taking profit of the consolidation which is happening in the North American and European market. With regard to U.S., what we are seeing is that during the last NEOCON exhibition, all the players, all the carpets that were previously using INVISTA as, let's say, important supplier, I remember that INVISTA stopped the production of BCF around two years ago, have finally launched all the new product lines and collections made with our ECONYL fiber. We are expecting, of course, a ramp-up of these new collections as a substitute of the past sales. It is still an improvement coming from the past. It is difficult to imagine a strong recovery of the market overall, apart maybe in the European nylon textile filament industry, which has suffered a downturn of more than 30%, which was, of course, including a strong destocking of our customers that is now finally taking place. For sure, we are not forecasting, neither in 2024 nor in 2025, to return to our levels of 2021 and 2022, but indeed, we expect some rebound in comparison with the last 12 months that have been particularly weak. This is the kind of scenario that we are going to explain in few days, also speaking about the business plan. With regard to the polymer and engineering plastic market, every market studies are reporting a growth of around 3% per annum. I remember you that we are 0.1% of the European engineering polymer market. We are not, let's say, an important player, nor we are considering to take five or 10 or 20% of market shares. Understood. Thank you. Then on the pricing environment, should we expect some stability or maybe some pricing pressure over the next 12 months? It's a good question, Amit, also considering the big swings that especially the raw material market has suffered, in Europe in particular, because of COVID first, then the recovery after COVID, of course the war and the energy crisis, and lately, the first 6 months of 2024, because of the transport crisis driven by the Suez Canal and the Red Sea transportation, which is practically blocked. What we have seen during the first semester has been an increase of raw material prices, especially in Europe, partially followed by U.S., and not let's say confirmed by China and Asia Pacific markets. What we are noticing now is a return to a normal level and to a more coordinated global pricing of the raw material, despite the transport system is still suffering big cost, especially when shipping from Asia to North America or from Asia to Europe. This is what we are seeing. In our planning, we are considering a stability of the price in relation to the raw material market. You know that Aquafil has always demonstrated to be able to increase prices when raw material was increasing. We are not considering to improve our margins or better to improve our prices. Eventually, through cost optimization, we can improve our margins, but we are considering to keep and to have a stable marginality on our product lines. Understood. Thank you. This was last one from me. For the ECONYL, we're seeing pretty strong year-over-year growth, sequential growth also 50%+. Do you think that will continue, or maybe some moderation on that front? In the first semester, ECONYL fiber revenues have passed the level of 50%. We are in the range of 52 point something%. Still growing in comparison with last year, with big differences, market by market. As you can imagine, Europe is having a bigger penetration of our ECONYL products. North America is the second, followed by Asia Pacific, which is, let's say, lagging a little bit behind. Let's say that we are still seeing a lot of projects in relation with ECONYL in the fiber business. Now we are also starting to see good news, some interesting projects also in the engineering polymer market for 2025. We are pretty sure that the ECONYL trend will continue during the next periods. Thank you, guys. That's all I have. Thanks. The next question is from Nicolò Storer of Kepler Cheuvreux. Please go ahead. Hi. Thank you for taking my question. Just a clarification on the proposed capital increase. I see on your press release that basically, you have both the proposal for a standard capital increase with preemptive rights and also a proposal for capital increase without preemptive rights. Does this mean that we could expect a mix of the two for a total of EUR 40 million or that it's EUR 40 plus EUR 40? Should we interpret that- No. Thank you, Nicolò. No. The total amount that we are looking for is EUR 40 million, also because, as you will appreciate by the new business plan, we think that this is exactly what we need or slightly less doesn't make a big difference, of course, in order, let's say, to let us develop our business plan and the additional CapEx. Okay. With that being said, the board of directors has decided to give flexibility because, should appear someone interesting from a strategic standpoint that expresses a desire of participating at the capital increase, partially or totally, at this point, we want to eventually consider this possibility. Clearly, at this stage, we don't have anything, let's say, on the table other than a classical capital increase with, of course, including the preemptive rights of the present shareholders. I mean, we are reading, or everybody's reading of the, my opinion, let me express this definition, sometimes a little incredible fundraising of startups that are trying to follow what Aquafil has introduced 10 or 15 years ago. Who knows? Maybe someone may come and give us interesting possibilities. Okay. Thank you. The next question is from Andrew Lawford of Fund Scouting and Advisory. Please go ahead. Hello. Can you hear me? Yep. Okay, great. Thank you for the update. Just following on from the question about the capital increase. If you do have a strategic investor, does that mean that the controlling shareholder would participate together with them, or would they be diluted as well? Do you have an idea of how deeply you're going to have to discount the pricing of the shares of the new shares issued? Have you had any discussions about that? Just sort of connected to that, how is the relationship with your lenders, and is the capital increase in some way being suggested by your creditors as well? Thank you. Well, let's start from the pricing. That will be decided as soon as CONSOB approves our prospectus. Also, considering the market conditions and the possible acceptance by the market that we are going to investigate during the coming weeks. As you can imagine, we have not had the chance to go by our shareholders or by other investors to make a presentation about our business plan. During the coming weeks, we will start investigating, understanding how this, let's say, proposal is accepted or welcome, and then clearly we will decide. Let me make a personal, let's say, comment. I think that the current market price of Aquafil is already largely discounted, so I hope that the board will not accept a super further discount on the price. Also, we have an interesting business plan, so I don't see why, clearly, to give such a discount. It will be the board to decide, and the decision will be made upon, of course, the acceptance and the feelings that the market will return to us. Our creditors, I don't see the problems. The numbers are showing that we are going or if nothing particularly strange happens, we are going to respect our covenants. The capital increase is not made because of covenants breaching, but because we want to grow faster and not waiting for another 12 or 24 months before moving ahead with certain investments that are very interesting. We expect that other opportunities may arise in terms of consolidation in the market. If you want to take them, you have to have financial resources for, of course, consolidating. If not, you have to pass, and this is not, let's say, a good idea for granting a bright future for the next three to five years to the company. I don't know if I have answered all your questions. Yeah, that's very helpful. Thank you very much. Thank you, Andrew. The next question is from Anthony Mannara of CI FirstEurope. Please go ahead. Hello, Giulio. A big hello from New York from everybody at the table. I just wanted to ask, were there any European narratives or legislation that you know that might be imposing some kind of a catalyst for further market growth or, for you to take advantage of the changes that are coming, that could be coming in Europe or in the United States? One thing that comes to mind is the amount of carpet in automobiles that needs to be recyclable. That was one of the topics, maybe. Is anything like that could be pushing? That's the first question. During consolidation, you were talking about consolidation. Would you be a buyer of other companies? Would you need more capital if that were the case? Of course, we would like to be the buyer and not the seller or the consolidated company, but you never know. If someone comes, and offers the moon, I believe that, for not only for the major shareholders, but also for the entire shareholders of Aquafil, we have to consider it. This is quite an obvious answer. Maybe I didn't answer to Andrew before. The major shareholder intends to, of course, support the capital increase. Okay. This is quite obvious. If a third party, an interesting and strategic third party comes, also the major shareholder should consider to be diluted for, let's say, the growth and the good results of the company. With that being said, speaking about legislation, the legislation is evolving, okay. For example, in Europe, a directive about the end of life vehicle has just been approved, that is asking to the automakers to include 25% of post-consumer content on every plastic component present in a vehicle for 2030, so for tomorrow morning. Clearly, we have been, let's say, contacted by some car maker understanding whether, through our ECONYL, we can provide this 25% of post-consumer content. We have to see when this directive will be finally implemented by every single member state, the kind of fines that the commission will going to impose, and also the definition of recycling content. Of course, the devil is in the details, so we must also understand the definitions. We know all about the extended producer responsibility legislation, which is now present in California, which is why we are collecting carpets in California. There are other legislations that are under discussions. Let me remember and underline that so far, all the results of Aquafil and of ECONYL has taken place without any subsidy coming from any state, nor from any particular legislation other than the one of California, supporting, let's say, a recycling content in the final product. We think that today we have reached a technological level which is quite high. We think that today we have still a lot of opportunities in terms of revenues and costs to be taken. That's why we express this confidence in the future. Having turned the page and having returned to a better financial result in the second quarter, I remember to all that we have scored plus 77% of EBITDA in comparison with last year, which is not yet where we wanted to be. Of course, we think that the peak of the problems are on our shoulders. It's time to react and possibly to try to take advantage of this situation, because our competitors, unfortunately, are not in the same position. Thank you. Thank you very much. As a reminder, if you wish to register for a question, please press Q&A on the left bar and raise your hand, or press star one on your telephone. For any further questions, please press Q&A on the left bar and raise your hand, or press star one on your telephone. Mr. Bonazzi, there are no more questions registered at this time. Thank you. I will soon invite you to the new conference that we organize for the 12th of September, when we are going to make a presentation about our new guidances and our new business plan, and also we hope that you have enjoyed this half an hour together with us. Thank you very much. Thank you. Thank you. Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your devices.