Good morning, welcome to the Cabka 2022 half-year results. With me here are Tim Litjens, CEO, and Necip Küpcü, CFO. My name is David Brilleslijper from Investor Relations, and I'll be your host today. Before we start, I just want to remind you that you can submit questions during the entire session, including when we started the Q&A, by just pushing the button on your right-hand side to submit questions. With this, I would like to go to the agenda. In a moment, Tim Litjens will start with an introduction and some strategic highlights. Necip Küpcü will dive deeper into the financials of the first half year, and Tim Litjens will conclude with a post-period event and an outlook, and we'll end up with a Q&A with both of them. For now, please, Tim, could you kick off with the strategic highlights and introduction? Thank you, David. First of all, warm welcome to everybody joining us live through this webinar in which I will, together with our CFO, Necip Küpcü, walk you through some of the main developments in the first half of the year, as well as, of course, the financial performance. We see that in the first half of the year, the market has continued to be strong. The global trends of supply chain rationalization, but also the increasing importance of sustainability and circularity, have driven continued strong demand for our products, which ultimately translates to a growth of 27% over the same first half year last year. Twelve percent of that is driven by volume. We see especially good progress in our strategic focus areas of Large Containers as well as Customized solutions. Also 15% of that is driven by price effects, where we have passed on the higher input costs of especially materials, but also energy, to the market. If we look at the market from a geographical perspective, we choose to focus on especially Europe and the U.S., and we see that in both markets, demand has developed very favorably. That also ultimately translates to a strong order book. We have an order intake over the first half year, which has been outpacing the sales in the first half year. Main reason for that is some of the larger framework contracts that we closed, amongst other, the contract with Target that we announced some time ago, which is kicking in now for the second half of the year. That strong top-line progress is also translating to our operational result, where especially with our market power, we've been able to offset these effects of inflation, especially visible in the higher cost of plastics, both virgin as well as recycled, but also the higher energy costs. Ultimately, you see that our gross profit is up by EUR 5 million, even held back a little bit by two events. One is the obvious delay that you will always face in a market where prices are increasing so rapidly and by this magnitude. Also the consolidation of the Eco business that we undertook in the first half of the year, which obviously resulted in a temporary reduction of our output capacity. Combined, those two effects account for roughly EUR 2 million unfavorable impact on the gross profit. Resulting EBITDA margin subject obviously to dilution resulting from the higher pricing comes in at 13% with a net income from operations of EUR 0.7 million. Obviously the first half of the year has been a very exciting half year for us, especially because of the stock listing. What have we been doing internally, in an answer, let's say, to this event? First of all, I'm happy to say that we've installed a two-tiered board structure with also in the last shareholder meeting the announcement of our new Chairman of the Board, Manuel Beja. Beyond that, it's triggered quite some changes incorporating all the requirements that are there for us to be acting as a stock-listed company. First of all, there is the translation now to IFRS, so all the financials that will be presented by Necip are on the basis of IFRS and no longer German GAAP, as well as the 2021 comparable figures. Next to that, we are also taking the next step when it comes to our strategy with regards to circularity and ESG. Obviously, our products are already well within the core of circularity with them being focused on reuse and fully on the base of recycled material. But we're now taking the next step of also bringing ESG to all of our internal corporate processes. To that extent, we've started a process a few months ago with PwC supporting us with mapping out that journey and those KPIs ultimately resulting also in a first ESG reporting which will be there at the start of next year. Next to some of the internal changes that we've been driving, we've obviously been operating in a highly dynamic external environment dominated really by two major factors. On the one hand, there is the geopolitical tensions between Russia and the Ukraine, which do not have a direct effect on us in the sense that we do not have sales to either of these two countries. But there's obviously an indirect effect because these geopolitical tensions have caused for the energy markets to really melt up, which is, of course, also impacting us when it comes to the energy cost. If we look at another external development, which is impacting. It's the disruption of the various supply chains that are out there in the world, and particularly for us, the materials. We've seen virgin resin market prices, although we have very limited exposure to virgin, increase pretty much double within the first half of the year. As a result, also the price for recycled plastics move up. Our backward integration strategy here is proving to be very valuable to us, because it especially helps us to safeguard the internal supply so that we always have material available in such a tight market to continue to supply our customers and go beyond that and grow. Looking at the financial markets, interest rates now in response to the higher inflation are moving up. Here, happy to say that we have rates locked in, but also with the limited leverage that we have at this stage because of the inflow at the moment of stock listing, the impact is really immaterial. Same goes, quite frankly, for the exchange rate. We've seen the euro depreciate quite heavily against the dollar. Outside of the minor translational effect that this has, any transactional effects have been hedged. Zooming out a little bit now to our strategic objectives, I'm happy to say that our strategy that we've laid out is really paying off. We have a strong commitment to invest in innovation and innovation of recycled materials on the one hand and new product on the other. We see that paying off. We've successfully expanded our position in Large Containers, but also signed multiple contracts with larger customers. Target was one example for these so-called Customized solutions. The business of what we call Reusable Transport Packaging has been progressing well. If we look at the other business that we run, which is called the Eco business, here it's been very much about driving, on the one hand, operational efficiencies and on the other hand, an expansion of our capacity. We did so through the consolidation of the two sites that we used to operate in Germany, now moving them into one. That has been completed. We should see those effects coming in the second half of the year. All in all, it's proving to be a good base for growth in both our end markets for RTP as well as for Eco. With that said, I would like to give the opportunity to Necip Küpcü to introduce you to the financials in more detail. Necip. Oh, thank you, Tim. Also, very warm welcome from my side to the audience. I will also now take all the developments, as explained by Tim, in the first half year and show how this translates to the profit and loss statement. We see here that we achieved record sales in the first half year in 2021, which is bringing us to a level of EUR 102.2 million and 27% over the previous year half year results. This is driven by especially organic growth, 12%, but also coming from pricing, which is 15%. What we also see here is that in the several rounds of price increases, what we did over the last half year was successfully covering also the absolute increase of the material and energy costs. Means that we have in the first half year at least on the variable part no impact coming from this cost increases. This translates also into a gross profit of EUR 59.5 million, which is EUR 5 million higher, which is also proportionally the same as the volume growth. Means the 12% volume growth translates also into this EUR 5 million increase in the gross profit directly. When we look at the fixed cost part, we see also here that the fixed costs are increasing. This is mainly driven by the increased output, but also by the inflationary adjustments in the first half year 2022. All combined results in EBITDA, which is coming in at EUR 13.1 million. That is from operating business, which is also impacted by the Eco consolidation as just mentioned, which is translating one-to-one to the bottom line, and also the delayed pass-through of the inflationary corrections. Overall, we come to a net income from operations, which is around EUR 0.7 million, compared to the previous year EUR 2.6 million. Zooming in now a bit more into the revenue. We see here that, across the board, we have increase of the revenues, looking into product segments, but also into the geographical key markets, where we are present today, especially in the U.S., but also in Europe. We see in Europe, that we are more than 20%, increasing our business in revenues. In the U.S., we have roughly 50% increase coming from the first half year, 2021. Looking more into details into the product segments, we see also here that, in our main business, in the reusable transport packaging, we see here also, in Europe, especially, in the customized solutions, a nice increase of the revenues, which is up by roughly 40% compared to the previous year. That is supported by the strong project pipeline what we have in order to support the revenues, not only in the second half year of this year, but also in the coming years. All in, the RTP Europe is growing as expected. The US business, as just explained, is also outpacing more than 50% growth. When we look into the ECO products, we see here a relatively stable revenue trend around EUR 11 million. This is mainly driven also by the physical consolidation of the Genthin site into the Weira site in Thüringen in the second quarter. Also, take into consideration that is a stable development, at least, from a revenue point of view. We see that the revenues are growing, which is nice on the one side, especially on the volume part. We also recognize, in the profit and loss, as shown before, a challenging cost environment. We see that the energy market is very volatile when it comes to the first half year, especially in 2022. You see that there is an up and down and the energy price in the first half year in 2022 was around EUR 195 per megawatt hour, while in the same comparable period in 2021, we had around EUR 55. Means, here we see already the increase on this chart. Looking more into the details, when we look into our three main sites in Belgium, we have partially protected the price development, cost price development, through quarterly contracts. In Germany, we have full exposure to the spot market, due to also high premiums. In the U.S., this is completely not impacted. The U.S. is regulated by the state of Missouri, so the impact there is zero so far. Besides the energy market, we see also in the material cost development that especially, when it comes to the development starting in Q2 2021, also up to now, more or less, we see that the virgin prices are nearly doubling coming out of the pandemic times in 2020. In the same way, in the same period at least, we see also the recycled prices are also steadily increasing. The peaks are across the board hit in Q2 2022. We see it right now. We also see that there is also more material available and that goes hand in hand with the first signs of relief in the virgin market. Besides the variable input cost, we see also that the net income is affected by extraordinary items. The net income in total, affected by the extraordinary items is, EUR -2.5 Million. In the positions, when you look more in details, we see also here that this is more listing-related IPO costs, for the bonus, for consultants, et cetera. The settlement of the WISAG, coming out of 2021 is impacting, as a one-off item, the results in 2022, first half year. Besides that, there is a favorable impact in the changes in value of warrants, which is also factored in, brings us to a total impact of, EUR -2.5 Million. Looking now more into the net working capital, we see that overall, we must say we are on track, which is good. Looking at the midterm guidance, we had also defined that we want to be at a level of 20% of sales. So far, I think this is on track. Looking more into details, we see that especially in the inventories, we have an increase of EUR 8.6 million, which is driven predominantly by the increased cost of the goods driven by the higher inflationary corrections, but also material cost development and energy. But also besides that, we consciously decided to serve the portfolio business with higher safety stocks. The trade receivables, we see here also reflecting the revenue development. We see the increase of 27% is resulting in higher receivables of EUR 2.6 million while the payables remain very stable. That is driven by the scarcity of the materials and the material suppliers are dictating to a certain extent also the payment terms. Overall, we see increase of the net working capital between 2021 full year and the first half year roughly around EUR 11.4 million. The CapEx part, I think here we can see that the CapEx is channeled to the direction of growth, which is also in our strategy. We are aiming our ambitions are midterm to long term to grow the business, as already indicated by Tim. We see here especially that the total CapEx is summing up at EUR 13 million or 42% compared to prior year. Looking more into the details of the RTP business, we see that we invested a lot of in molds, product developments, new business, supporting also the project pipeline as explained, but also the other business segments in the RTP business. Overall that is the one side. Besides that, we have the ECO product. The growth CapEx investment is EUR 3.7 million, which is also predominantly related to the ECO consolidation. Coming out of the second half year of 2021 combined with the first half year 2022, we can say that the complete project is now on time and on budget completed. That was also something we expected in that way. The maintenance and replacement CapEx, that is also part of our midterm guidance. We see here that this is at a level of 2% of revenues, and the midterm guidance was here 4%. Overall, I think the CapEx is fully related to growth or predominantly related to growth. That part is, I think, clear. Besides that, we have also in middle of March, we have the acquisition of the minority shares in the U.S. subsidiary. We have also the 100% of the affiliate now within the group. That resulted in a CapEx of EUR 1.8 million. The overall picture of the net debt decreased, especially by the cash inflow from the business combination. We see here that the net debt starting at EUR 62.5 million end of 2021 was basically we see here that the CapEx, the growth CapEx, was offset by the operational result, the normalized result before depreciation. That part is covered. Besides that, we see that the net working capital with EUR 11.4 million combined with the other working capital, EUR 3.8 million, is increasing the net debt position by EUR 15.2 million. Additionally, we have also this extraordinary items rooted in listing costs, as explained before, which is also EUR 6.9 million. Combined with the cash inflow, we come to a level of EUR 40.6 million net debt end of June. This is resulting in a net debt to EBITDA level of 2.2. Overall, when we go back to the midterm guidance what we provided earlier, we see that the five tick boxes are, I would say, well under control except one position. That we can look into. We have in the revenue a high single digit revenue growth assumed or in the guidance provided. We achieved in the first half year 27%. We see in the EBITDA margin 20%, or we want to be above 20%. We achieved 13%. As explained also previous, we have also some dilution effects based on the revenue increase coming from pricing, but also the cost increases in material and energy, which is diluting the also the EBITDA margins. The CapEx from maintenance and replacement as of percentage of revenue is, as explained, at 2%, and the net working capital is exactly on track with 20%. The provided payout ratio for the dividend with 30%-35% of net profit is something we stick to at this stage. All combined, these are the first half year results, more in details. I would give the word back to Tim, and he will now also give some words on the post-period events and give some outlook details. Thank you, Necip Küpcü. A post-period event which we also published recently, the flooding of the Hazelwood plant. Let me start off by saying that I'm extremely grateful that none of our personnel was harmed during this historical flash flood that happened in the area of St. Louis. As a result, though, our operations in the factory of Hazelwood have been severely impacted. We still now after three weeks are in a situation that the operations are shut down. We are obviously doing all the necessary to clean up and to do the assessment on the equipment and electrical to see that the plant can be brought back. Also fair to say that we are subject to the rulings also of the county and state who've declared the entire area currently as a catastrophic area. Meaning also that there's not even power to the region at this stage. That drove us to move and react very quickly in order to protect our business and to continue to supply our key clients. What we've done is we've extracted all of the injection molding tools, and we've reallocated these to alternative production locations, largely also with some of our already existing manufacturing partners in the United States. That is enabling us to now restart deliveries in August. Where already by the start of September, we expect to be at roughly 70% of the supplies compared to where we were before the flood itself. On top of that, as mentioned, we have, especially in the second half of the year, the Target contract kicking in. Also, the production and the deliveries related to that contract have been safeguarded. Combined, we will actually see that the revenue for the second half of the year, despite this rather catastrophic event, will increase. There is a flood insurance in place, so there is obviously now very intimate discussions ongoing with the insurance companies and the relevant adjusters in order to assess the damages and also the compensation for that. With that being said, trying to wrap it up, moving to the outlook. The outlook stands in a context, on the one hand, a very strong market for us, where, as explained, the demand for recycled RTP solutions is strong and where our strategy really focused on bringing Large Containers, but also Customized solutions to the market is starting to pay off. At the same time, also a context which is dominated by high uncertainty related to the geopolitical tensions that we have here in Europe and thus high uncertainty in the energy market, which are dynamics that we will have to maneuver around. That being said, as the material markets are starting to plateau or even show some relief, virgin prices coming down, recycled materials becoming more easily accessible at this stage, but also the energy market at the same time getting even more volatile at this stage, recently actually moving to new highs. We will see that these things will continue to impact our margin on the short term until the major input variables from a price perspective will stabilize. All that being said, we do stick to our midterm guidance, with the note that the relative EBITDA margin is subject, as in the first half of the year, to these inflationary developments. With that, David, I come to the end of the outlook. Thank you, Tim. Thank you, Necip, for your introductions. It's time for Q&A. I have some questions already on the screen, but if you want to submit new questions, you can still do that. Well, we're answering these questions. If you want to submit a question in the right-hand corner of your screen, you can submit new questions as well. To start off, I think one of the first questions is more on the sales side, on the Target contract. Nice contract, but can you tell a bit more or elaborate a bit on that contract, on how much containers are delivered? How big is it? How long the period is you cover, et cetera? Yeah, is this a one-off, or can we see more of these? There are quite a few questions, but let's start first on the Target contract and then continue on maybe is there more? Okay. Yeah, as published, the Target contract is a, it's a so-called Customized solutions for a foldable Sleeve packs. One that we've developed very closely with Target over the last three years. It's resulted into orders now coming in for a delivery in the second half of the year of EUR 13 million, and it is expected as Target rolls this out through their entire supply chain network in the United States, that these orders will continue to follow on a quarterly basis, after delivering on this initial order, now in the second half. How much was the first order you said? EUR 13 million. EUR 13 million. That was for the second and third quarter. Yes. On a quarterly basis, that will continue. That is, the idea is for this to be rolled out throughout their entire chain. They have over 1,800 physical stores in the United States. So you can imagine how many movements are there. Actually, I can't, I think. The second part of the question is this a one-off or can we expect more of these? How does this relate to the strategy and your capacity to produce? No, this is certainly not one-off. Of course, Target is a major customer. This contract also represents a very significant future sales. We have multiple of these developments in our pipeline. There is also other contracts that we've signed in the course of the first half, for example, in the automotive industry or in the beverage industry. Maybe not to the magnitude of the Target contract, but nevertheless, what you see is that our focus to work very closely with our customers and develop solutions that are really tailor-made to their supply chain needs is bearing fruit. I expect for this pipeline to continue to thrust also the growth in the future. Okay. That sounds promising. Let's see what will the future will bring. Next question is for Necip, I think. We saw operational costs coming up in the past half year. Can you elaborate a bit on that? Can you explain that to us? Thank you, David. Compared to the first half year, 2021, we have an increase of operational expenses. Here we have a couple of things. First, when we look into the personnel costs, we see that this is majorly driven by the increase of operational output, but also based on inflationary adjustments. Parallel to that, we have also built up some, let's say, talents within the organization to cover also and support the growth ambitions over the coming years. Also here, we have added new, let's say, colleagues in an innovation center, which are supporting us especially in the product development and material development, which is also part of our core strategy. Also here, we consciously decided to invest into this infrastructure. Parallel to that, when it comes to the other operating expenses that we see here, in the first half year, we had still the situation we come out of this post-corona situation in this first half year, 2022. This is somehow normalized. We have increased marketing costs. We have medical and safety cost increase, but also when it comes to IT and infrastructure, but also cybersecurity is a topic. All this cost elements taking into consideration is bringing us to the increase in the operating expenses. Bit of investing in the future and a bit of extra inflation. Correct. Yes. Okay. Thank you. We go a bit back to the commercial part. One of the questions here is the war in Ukraine and the resulting tensions made wood prices rise and the prices of wood pallets. Is Cabka profiting from a shift away from wood into plastics? Can you tell us a bit more? Yeah Maybe the context of that? Well, there was certainly some short-term effect, I would say, in the beginning of the first half of the year where wood was and therefore wooden pallets were very hard to come by. We saw customers shifting to plastic simply for that reason. But then I really speak of the more lightweight pallet. I think we see a much more structural transition within the market where customers are focusing not only on products that are made out of recycled plastics or are a hundred percent recyclable. Customers are also focusing on products that are designed on the basis of reuse. It's especially that is helping us to drive that transition. Okay. Thank you. I come back to the States. You gave a first indication of the possible damages figure on the Hazelwood plant. Can you give that? How does it is expecting to? I don't know, Necip or you, Tim, Hazelwood. I can take that question. Okay. As I said, right now our immediate focus, and we're doing that successfully, is to get production up and running, to get our client base served. The short-term impact of that is that we will be able to recover up to 70% of that revenue. Of course, that comes with certain costs of also partially outsourcing this production. We're buffering that through cost measures that we are taking internally. Take that combined with now also the deliveries that are starting for the Target contract. I expect, I know that the revenues in the second half will actually be above the first half of the year. The Target deal is not a danger? No. The Target supplies are secured. From the other supplies? 70% is secured. your main customers Exactly. Our main customers, our strategic customers are secured. Supplies are starting or restarting as we speak. I expect to be at roughly 70% of our original supplies by the start of September, which if you consider the fact that this happened three weeks ago, I think is a very quick response. Yeah, it's a quick response, but still. The Target deal. Did I hear it well? It was $13 million for the first two quarters, not $30. 1 3. EUR 13 million. Yes. Okay, good. Thanks. Let's go to one of the other questions. The bottom line impact of Hazelwood shutdown, I think we covered that, huh? Yeah. That's a potential impairments there. You say we are still looking at that. Yeah. We're currently in the midst of the assessment, which of course we're doing ourselves, but also in close partnership with equipment suppliers, but also the insurance companies. It's too early to say what that impact would be. Yeah. Sorry, I'm looking at two questions at the same time. Okay. That's not helpful in the current context. Can you go back to 70% in the U.S. with the current context? Or do you have to return to the current plant? You say you can do 70% of the current customers. Yeah plus targets at this moment. Yeah. Can you increase that to 100%, or do you need to return to the plant production to do so? We are now constantly in the market, of course, looking for capacity. As we do so, we will add machines. Will we be able to go to the full 100%? That is to be seen. The quick ramp up to 70% certainly gives us the confidence that we should be able to really supply the majority of the demand. Another question on gross margin. All your competitors seem to be confronted with stronger rises in input prices than you. The input is higher and the costs are higher. Does that offer an opportunity to increase your gross margin? I mean, basically, if this is a question to me. Let's start with you on the gross margin. All right. Basically we see that the material costs of course are partially only purchased from outside, from externals. We have internal recycling capacities where we also can say we have 87% of all our materials are recycled materials where thereof is a big part also own in-house recycled. Combined with this that is basically also translating in this gross profit levels as shown in the profit and loss. You say it's already. It's in the gross margin, you see that we have, because we produce internally 70% of the recycled materials, we have lesser impact than our competitors. Exactly. Yes. Okay. Maybe to add to that, I think you see that despite these quite significant price increases that are being pushed in the entire market, we are able to still grow quite substantially with 12%. Part of the reason is that we are able to offer at still a very price competitive level. On ECO products, Necip, you did a consolidation in Weira. How much of your capacity did you increase your capacity there by the move from Genthin to Weira? Basically, what we did is we moved first the Genthin site to Weira, and parallel to that we increased the capacities. We have around 30% increase in the recycling capacity, but also in the production of our products. Both combined gives us the economies of scale and also the leverage effect. 25%-30% more than the combined previous Genthin and Weira. Exactly. Yeah. Okay. Thank you. We go back to energy. You mentioned that the energy prices in Missouri are consistent or constant- Yeah because of the law. Do you expect them to rise there as well, like we did? How would you anticipate on that? As said, energy rates are controlled by the state of Missouri. That also means that you're not able to contract any energy. There's only one supplier there. It's as simple as that. No expectations on rise or any. No, we've been in touch of course with both the state as well as Ameren, our energy supplier. Both are confirming that there is no such event on the horizon. Okay. For Europe, there, Europe- We've seen some uncertainties also over the past few weeks. How are you dealing with that? Europe is an entirely different story, of course. On the short term, what we are doing is, we've introduced a so-called energy surcharge to our customers. We are being very transparent with our customers on what the incremental costs of energy are to us, and we are passing them on. We've already mentioned that this typically happens with some delay effect, giving also our clients the opportunity to react to this. That is what we do on the short term, while we obviously monitor on a daily basis how the energy market is developing. On the medium term, where possible, we are always looking into contracts. As mentioned by Necip Küpcü, we have some contracts in place, especially in Belgium, for the second half of the year, but also for 2023. On the long term, I think also very relevant, we are focusing to move to more renewable sources of energy, solar, wind. At the same time, also as part of our current ESG roadmap, reducing our overall energy consumption, or in other words, becoming more energy efficient. Okay. It's a staged approach. Yes Short term to long term. On this, how will the margins be impacted in the second half year by these higher energy prices or increased feedstock? Can you shed some light on that? Yeah. We've also mentioned in the press release that there is another price increase effective per August 1. This is to cover the energy increase that basically happened in the course of July. As said, we are monitoring this very closely. Markets are subject to very high turmoil at this stage, so we will see where this settles. If necessary, ultimately we will have to go back to the market and pass on more. Yeah. Maybe for you, Necip, then, you. Also Tim says price increases fully cover your cost increases. As of when have the price increases been fully implemented and reflected in the results? Because we see Right A lower operational result, lower EBITDA. Right. We announced, as said, also last time, we announced in end of 2021 the increase, as per January 1, this year. That was the first price round. The second price round we did, mid-March, and, as Tim just mentioned, we do now another price round, in August 1. On the effect, what does it mean for the bottom line? We see that we are covering the variable input costs so far, but of course, with some delay or lagging effect, when it comes to one-to-one translating to the bottom line. At the end, it's always a temporary situation, where we have this lagging effect, but we see so far it's completely covering. When it will stabilize, that will run out. Exactly. the lagging effect that will be the favorable effect. Okay. Right. Thank you. How long will it take to roll over all contracts to the new terms? I understand you have new terms with indices to allow you to pass on cost increases. What will the new terms offer full protection? When will the new term offers full protect against cost increases for you? Is that already? Is that one the Yeah. Maybe that's a question I take. The long-term contracts indeed have indexation clauses in there, typically on a quarterly basis, covering both the increase of materials, but also inflationary effects. That being said, when necessary, we are also engaging with some of our close partners at an earlier stage, because everybody understands that these are very special circumstances, let's say, that may need some flexibility from both sides. Full protection is a bit far, but you cover the energy. Yeah. material As mentioned by Necip Küpcü, you see that despite the delay effect, yeah, there is full coverage at the end of the second quarter of the additional input cost. To EBITDA, you see, of course, you mention, also mentioned that the inflationary effects or impact on the EBITDA. Are you also looking at cost-cutting costs, for instance, to come closer to the 20% goal, or is that out of reach because of inflation? Yeah. Basically, I think, first of all, when we look at the net income or the net EBIT, the EBITDA as reported, we have in this number included some extraordinary items, which is one-off item. That is for the first half year, mainly related to the listing. We don't expect such a big-ticket item anymore for the second half of the year. Parallel to that, of course, we are constantly looking into fixed cost saving programs, combined also together with the sites. We also launched right now a program with the sites together and determined targets. We are constantly looking into these kind of measurements. Yes. Cost cutting to improve EBITDA in any way in absolute terms and. Sure ... by less extraordinaries, but the margins will be kept depending on cost developments, of course. Sure for some, to some extent. Back to the indexes and also the indexation clauses for clients, will cost reduction also be passed on to the clients? Um- When prices will go down. Yes. As said, we have the habit of being very open and transparent with our customers, which is benefiting us, especially in these times, because there is a lot of understanding and therefore also flexibility on the other side. Which also means that if input costs, be it energy, be it materials, are going to come down, that we will also adjust our pricing accordingly. Okay. I've got a very difficult question. It's on share price. It's always difficult to answer that, but your share price is down. It's been since listing. Do you have any opinion on why? I think this is almost impossible to answer, but maybe. Look, I think it's not so relevant to study or to go into why the share price now is down compared to the actual listing and also trying to put that into the context of today's market. For us, we're in this for the long haul. We made a very conscious decision to list. The access to the stock market is giving us opportunities that we did not have before, and that's what we focus on. Besides that, it's a steady execution of our strategy that we hold onto. Okay. Before I continue, we have some questions still left, and questions are coming in. If you would like to submit a question, you can still do it, and we'll take it in the call. If you want to submit questions, the right-hand corner, there's the button to do so. One that has been submitted, Necip, is on the tax rates. Not so much on the tax you reported in H1, but in the second half of the year, what is your expectations for the tax rate and the final tax rate for this year? The tax rate as we have today is driven by the legal entities. Basically, we have the corporate income tax rates per region. That is also determining the overall tax rate based on, of course, the results generated in each one of the legal entities. All combined, usually we have a tax rate between 26%-29% as a corporate income tax rate. That is usually the expectation what will be end of the year. For the end of the year, we can expect tax rate like that over the entire. Correct year, it's by entity and not overall. Exactly. Okay. One more on cost passing through cost impacts. Have your price increases enacted in H1 covered only the cost impact, or could you also pass on some margin? If so, should we anticipate you will only be passing on the cost inflation aspect in future, or can you also cover some margin? I think this is maybe for you, Litjens. No, considering the magnitude of the inflation, we focus to pass on, for now, just the cost, also with our ambition to grow. I think more relevant that will be the overall improvement of our margin related to the mix. As we bring more Customized solutions to the market, but also the Large Containers, new logistical pallets, that's obviously because of our IP position where we also aim to improve our overall profitability. A bit depending on the product, but, Yeah, mix will definitely play a role. Okay. On costs. How are fixed costs as opposed to variable costs tied to the higher output? How would we look at that going forward? As we saw fixed cost coming up in the first quarter, first half year. Is it related to output, or is that independent? If we make more output, will fixed costs go up as well? Right. As also explained before, part of the fixed costs are related to the demand. We have the increasing demand, especially the 12% volume growth in the first half year. We see also that is resulting in higher operating expenses. You can say one part is driven by this output, but the other part is of course driven by the structural measures we took, putting infrastructure in place. That is so far done. Combined with the efforts, as just also explained, with the cost saving programs, we are aiming to achieve. We expect the fixed cost part will not increase. On personnel, on staff costs, because that's also part of the fixed costs. Right. That is also included in the answer. Basically, what we also did is just to mention, we have also, for example, in the beginning of the first quarter, we have put some inflationary corrections in place through the entire group, but also to reflect the situation on that end. Okay. A final question on this, on capacity growth. You Mm-hmm ... invested in growth. How is your current capacity utilization rate? How efficient are you? Yeah. mainly I think, yeah, basically, when it comes to the Eco product business, we can say that in the first quarter, we are near to 90% of the capacities where we have utilized. In the second quarter, obviously coming from the consolidation, we have a delay here. When it comes to the RTP business, we see overall that we are at a level of around 80% at this stage. What is normal? Because you always have your maintenance, et cetera. Yeah. It's That's on the basis of already corrected. Exactly for what you call in the industry an OEE, overall equipment efficiency. Yeah. We have that headroom. We have that headroom in both our. Especially now with the investment in Eco, we have that 25%-30% capacity that we can start to leverage. On the RTP side, we have up to roughly that remaining 20%. If you look into the investments that we've done, next to expanding the capacity in injection molding itself, the majority of what we're focusing on is investing in molds, and in other words, new products. Okay. Raw materials, there's a question here, raw material supply growth expectation, could that be a bottleneck? Well, what we've seen in the market is that there's been a very strong demand for especially recycled resin. That's where, as mentioned, our backward integration has proven to be very helpful, because we've to a much lesser extent been subject to this scarcity. Our aim is also to continue to keep our exposure to the merchant market for recycled materials limited to more or less the exposure as we have it today, especially to tackle this challenge. Okay. One more on Target remains popular, but also more explanation. You indicated the $13 million turnover for Q2 and Q3 together. After this, a quarterly rate, run rate of $6.5 million or $13 million? You're laughing. That's, is that a good sign? Well, as said, typically the way that this works, whether it's Target or it's any other large customer, they start to fill their network. The network obviously of Target is huge. We will continue to see them coming in with strong demand to fill that network. We do expect, and that's also what we are anticipating, together with Target, actually, we do expect an acceleration of that demand in the course of 2023. That's at least what we have scaled up for, from both a machine perspective as well as from a tooling perspective. Okay. One question again on the listing itself. You're listed now. Can you say something on how you will use that listing going forward? Is it an option, for instance, for M&A to issue new shares in the near term? Or are there any other ways you see that we benefit from this listing? I think the listing is benefiting us in multiple ways. First of all, it's making us known within the market, but it's also giving us a different type of reputation with some of the blue chip customers that we engage with. At the same time, of course, we've also gone for the listing to have access to the capital markets. We've made it clear that we have strong growth ambitions. So an inorganic strategy remains part of our outlook. That's where the access to the capital markets, of course, comes in very well. Okay. No immediate plans, but. No, we're currently. Wait We're currently underway studying that. Yeah. Okay. Maybe two questions that might be a little related. The first one is, what are the two main challenges for the coming six months? Either of you. I think as Tim explained also, the energy market is still volatile. I think that is something we are observing very closely that remains in place. All the actions we are taking, we need to monitor very closely and follow up in the way we did also in the first half year. The target is, of course, to cover all the costs. What is the result of these increases by the price increases we put in place? That is, I think one of the main challenges I see. Tim, anything to add? Well, I can only echo what Necip just said. If you agree as management, that's always good, no? So good. One related question, I already said there was a related question. If you look at the future, but also at the past, what happened over the past period, risk management becomes more increasingly important in the current geopolitical climate. Can you give some more background on your risk management organization? Yeah. Yeah, sure. I think so far, we have the risk management in the finance organization. We are dealing with this topic also with the sites combined. Being now a publicly listed company is also bringing us to a different approach. Basically what we are now doing is, we have this also on the agenda as we have the ESG topic or the IFRS, we have this on our agenda. In the near term, we want to approach this topic more conceptually. So far we are dealing with this within the finance organization. Okay. Which is usually finance and risk, yeah. Right. Okay. Thank you. I think we have touched upon quite a few questions. I don't have any remaining questions anymore here. A few technical remarks maybe. The presentation is already on our website. The slides are on the website. We disclosed that together with the press release and the full half-year report that are also on the cabka.com website in the News and Investor section. The recording of this webcast will also be placed on the website as of tomorrow. Not today yet, but tomorrow you can find the recording as well. If there are any questions not answered in this session, you can always, of course, send your questions to IR@cabka.com and we'll try to reply to you as soon as possible and come back to that. I think that having been said, we've covered a little over an hour with presentation and Q&A. Tim and Necip, thank you for sharing everything with us. You all who dialed in or looked at the webcast, thank you for joining us and for your interest in Cabka. I hope you have a very nice day going forward. Thank you. Thank you, and goodbye.