Welcome to the Corbion Q1 2026 Results Conference Call. Following the opening remarks, there'll be an opportunity for questions. Please note that this call will be recorded. I would now like to hand over to Mr. Alex Sokolowski, Head of Investor Relations. Please go ahead, sir. Thank you, operator. Good morning and welcome to Corbion's first quarter 2026 interim management statement conference call. This morning, we published our Q1 2026 results. The press release and presentation can be found on our website www.corbion.com, Investor Relations, Financial Publications. Before we begin, please note that today's discussion will include forward-looking statements based on current expectations and assumptions. These statements involve risks and uncertainties that may cause actual results to differ materially from those expressed. Factors beyond our control, including market conditions, economic changes, and regulatory actions, can impact outcome. Corbion does not undertake any obligation to update statements made in this call or contained in today's press release and presentation. For more details on our assumptions and estimates, please refer to our annual reports. This is Alex Sokolowski, Head of IR, and with me on the call are Olivier Rigaud, Chief Executive Officer, and Peter Kazius, Chief Financial Officer. Now, I would like to hand the call over to Olivier. Olivier? Thank you, Alex, and good morning, everyone, and thank you for joining us today for Corbion's first quarter 2026 earnings call. Let me get straight to the point. As we outlined in February, the first quarter reflects phasing effects, primarily Health & Nutrition and a very strong comparison base in Functional Ingredients & Solutions. Against that backdrop, we deliver group sales of nearly EUR 294 million and an adjusted EBITDA of EUR 37.8 million with a margin of 12.9%. While this is below last year's exceptional start, it's fully in line with our expectations, and importantly, it doesn't change our confidence in the year end. In fact, what we are seeing now is encouraging. April trading confirms that momentum is building, and we expect a clear acceleration in both volume and earnings as we move through the year. Let me highlight what is driving that momentum. In Functional Ingredients & Solutions, we delivered stable sales of EUR 236 million against a very strong prior year. Underneath that, volume and mix were positive, supported by continuous strong demand for natural preservation solutions and the solid growth in biochemicals and lactic acid to PLA. While margins were temporarily impacted by mix, we expect a steady improvement from Q2 onwards. This will be supported by lower sugar costs and disciplined cost reduction execution. Growth will continue to be driven by structural demand for food safety solutions and increasing adoption of PLA, particularly in 3D printing and as dynamics in fossil-based plastics evolve. In Health & Nutrition, Q1 sales of nearly EUR 58 million reflect phasing into the remainder of the year. The fundamentals here are strong. Demand remains robust. Fish oil prices are going up. Our contract positions are intact, and we expect a normalization of sales and volume growth from the second quarter onwards. Our biomaterial business continues to build momentum and delivered a second record quarter in a row, delivering growth across orthopedics, drug delivery, and aesthetics. On the TotalEnergies Corbion joint venture, we also achieve organic growth, and our divestment process is progressing as planned. At the group level, margins were impacted by mix effects and temporarily lower operational leverage in Q1. These are timing-related factors, and we expect a clear improvement as volume ramp up and cost measures take effect. This brings me to cost discipline. In a macroeconomic environment that remains volatile, particularly with the well-known geopolitical tensions, we are acting decisively and have implemented a focused cost reduction program. Turning to cash flow, Q1 free cash flow was negative at EUR 15.7 million, and as expected, given seasonal patterns. We remain fully confident in delivering EUR 85 million-EUR 90 million for the full year. Looking ahead, we fully reaffirm our 2026 outlook. We continue to target 3%-6% organic sales growth, an adjusted EBITDA margin of around 17%, and strong cash generation, with performance weighted towards the second half. This will be driven by sustained demand in natural preservation, normalization in nutrition, improving PLA market conditions, and disciplined execution of our cost reduction initiatives. While uncertainty in energy and input cost remains, we have robust mechanisms in place and are actively managing volatility through pricing, hedging, sourcing, and operational control. Let me close with this. Q1 reflects timing and comparison effects, not the strength of our underlying business. Our fundamentals are strong, momentum is building, and we are executing with discipline and focus. We are confident in our ability to deliver on our commitment for 2026. With that, let us move now to questions. Thank you, Olivier. Call participants, if you'd like to ask a question on the call this morning, please press *11 on your telephone and you'll be placed in the queue. If you'd like to remove yourself from the queue, press star one one again. Also, kindly mute your line while your question is being answered. Our first question this morning comes from Wim Hoste, KBC Securities. Wim, please go ahead. Yes. Good morning. Thanks for taking my questions. I have three, please. The first one is on the raw materials versus pricing dynamics. I know there's significant hedging on sugar and energy and some of the other components, but can you maybe, yeah, quantify or elaborate a little bit on the kind of headwinds you're seeing, maybe also on transportation costs or logistics issues, et cetera. Then also what kind of pricing initiatives you put against that. That's the first question. The second one is on foods. Can you maybe elaborate on the contract wins that are mentioned in the press release? What kind of product geographies are we talking about regarding these contract wins? Then third and last question would be on the progress with the PLA divestments. Can you maybe elaborate a little bit on the process, the number of interested parties, the alignment with Total on that? Those are the questions. Thank you. Okay. Thank you, Wim. I will answer the food and the contract wins, and Peter, the points on the raw material pricing and the PLA. Let me start with your second question on contract wins. Basically what we see in foods are twofold. One is related to our natural preservatives and primarily related to some specialties in there on clean label. You might remember we discussed during our CMD about the new EU Listeria regulation that is getting implemented in 26 July this year. We've been actively working on this, and this is bringing very nice upside, primarily related to our natural vinegar systems. We see that really already starting in Q1 but accelerating over Q2 as customers are preparing to switch to new preservation systems. Among others, we see strong momentum in seafood. That is one. The second one is more U.S. related, where back on the GLP-1 trend, we've had a couple of major wins on high protein functional systems for our bakery business, and we have been able to build some inventory to prepare for the big launch in Q2 on that front as well. These are among the two major drivers of these food ingredients contract wins, you know, that we discussed about in the press release. Now to you, Peter, for the two other questions. Yeah. If you look on a raw material perspective, Wim, then you are right that in sugar we have kind of full visibility for the coming periods and look fully hedged for this year and also hedged into 2027. I think the other key components which I would like to call out, which relates to the Middle East, is of course energy prices and therefore transport prices, as well as if you look to the Middle East, then sulfur is playing a role as well, and we use sulfuric acid in the production of lactic acid. Now, if you look to the three components, energy, and you can find it in the annual report, is around 7% of input cost, is well hedged. For the remaining part of the year. I would say minimal exposure on that one. In transport, we do see some exposure, and I think the exposure is mainly on the sulfuric acid part of the equation, which, how we currently view and look to it, we're talking here on a number in this year of up to EUR 10 million. We are indeed taking pricing actions and mechanisms in the market, and that's a combination of prices, surcharges and all the rest. That's a bit the current look at the Middle East impact, I would say from a cost perspective. On your question on PLA, I would like to stay a bit high-level, but we are progressing nicely and on track, and I indicated in the Q4 call that we anticipate to bring more news by mid-2026, because I don't want to hamper or jeopardize the process itself. Okay, understood. Thank you very much. Thank you, Wim. Our next call this morning comes from Robert Jan Vos from ABN AMRO. Robert Jan, please go ahead. Yes. Hi, good morning. I have a few questions as well. Yeah, based on what you said about pricing and FIS in Q1, still slightly negative, but the mix plus easing of input costs, should we anticipate positive pricing in the forthcoming quarters? That's first on FIS. The second one is maybe elaborate a little bit on the softness in the North American market. Moving to H&N, you say that you expect volume mix growth to return to positive in the next quarters, compensating for Q1. My question here is, because Q1 was pretty negative, do you expect positive volume mix growth for H&N in the full year? Related to this, what about pricing in H&N in the coming quarters? My final question is the cost savings. Can you elaborate a little bit on this? What is the amount that you expect for this year that you can take out of your model? How is it split per division and are there upfront costs related to this? Thank you. Thank you, Robert Jan. I will discuss the answer in North American softness and the H1, while Peter, you can take pricing and cost savings, yeah? Let me start, Robert Jan, with the softness on North American market. Indeed, you know we are exposed to some large categories as bakery and meat there, and we've seen, of course, the inflation impact and tariffs impact in the U.S. to some large customers. That impacted already Q4 last year. We've seen some continuation of that in some of these categories. Although I have to say lately, when we look at retail numbers, you would say bakery is leveling off, so it's not declining anymore, while the meat sector is still declining in the U.S. Now, as I said, it's unequal. We see indeed some of these development, as I just mentioned, on very specific area, being the natural preservation in the clean label. There is still underlying quite a lot going on related to MAHA on clean label development, primarily on preservation specialties. Nothing new, but the continuation of the fortified proteins, you know, compounds that we see. Yeah, as you know, it's a big market for us. It's a mixed bag. On the meat side, it's more negative than in bakery where things are stabilizing. There is a new spot, which is a bright spot for Corbion emerging in the U.S. being around culinary, where it was part of also our strategy to develop business in culinary. I mentioned just before on the previous question, that indeed we also spread around these Listeria antimicrobial systems, now primarily based on vinegar. We see really strong sales of vinegar-based preservatives across the board, not just in Europe, but also in North America. On the H&N expected return, there, as we said, indeed, we see already a much better momentum, starting in Q2, and we have a very good visibility, as we speak now on Q2. As you know, and we explained, primarily going into aquaculture, this is a concentrated market with five large players. It's really phasing in at one of these customers that we knew upfront, that is now kicking in as from Q2, on one side. The reason why, and to your question, we expect a positive volume mix growth for the year, and we see a few strong underlying drivers. First of all, as we said, we've been able to renew the expired long-term contract. We have a good contracted position for the year. That's one thing. We are developing nicely into adjacent market, being human nutrition, and also, we have very nice development into the shrimp market as we speak in the Asian markets. That's a second driver we see supporting our growth this year. Obviously, on pricing, we see also nice upcoming impact later on this year, non-contracted part of our business, supported by fish oil price increase. You might have seen now the final quota for Peru has been officialized and is 36% lower than last year. That is obviously driving fish oil price up, which is a nice support going forward for a non-contracted part of the business. What these lower quotas also say, just to close that point, is basically that the famous fish oil gap we've discussed many times, and also at CMD, was anticipated to be around 50,000 tons shortfall for fish oil, is more likely gonna be much higher than the 50,000 tons for this year. We are tracking that every day, but so that's what makes us feel really comfortable on our H&N for this year. Peter? Yeah. Your point on the pricing, Robert Jan, it was indeed negative in Q1, driven by the way, by lactic acid pass-through mechanism to the joint venture, with a bit of positive offsetting in some other areas. The price uptick, which I just discussed related to the Middle East, is not included in Q1, and will be only as of Q2, but mainly in the second part of the year. I anticipate a mild negative in Q2, and then basically returning into positive. If you look in terms of the acceleration of our cost savings program, and if I look a bit on the timing and the impact of that, then the savings program together with the sugar, basically, if I look to an impact Q2 already versus Q1, I anticipate an increase of around EUR 5 million. It will be mainly in Functional Ingredients & Solutions, and a bit in Health & Nutrition. All right. I must make one additional comment because you did ask, sorry, I forgot. In terms of additional costs, we did incur some additional costs in Q1 in anticipation, basically, of this program. Okay. That's very helpful. Thank you. One follow-up maybe. Now that you mentioned that there were some costs taken in Q1, I also saw that depreciation and amortization was EUR 23 million in a quarter, which appeared a bit high. Is that a proxy for the remaining quarters, or did it include some impairments in Q1? No, it includes some small adjusted items related to two different elements. One is the divestment process of PLA, as you can imagine, and the other one, which is good news, which you will not see basically in our numbers, but only in H1, is that we had a positive tax outcome in a discussion with the Spanish authorities, which would have a positive impact of around EUR 5 million in terms of tax this year. We incurred some costs, which are also included in that part. If you look from a depreciation element specifically, it's around just above EUR 22 million, which is aligned basically with kind of the trend in Q2, Q3, Q1, Q4. Very helpful. Thank you. Our next question this morning comes from Fernand de Boer from Degroof Petercam. Fernand, please go ahead. Yes, good morning. It's Fernand de Boer, Degroof Petercam. Actually, I had one question. If I look to the drop in EBITDA in FIS, you can say, okay, part is because of Forex, maybe the mix was negative, but still, there is an absolute decline of EUR 10 million. Could you help me out a little bit on the bridge? Because I can understand maybe that food sales were quite negative in that respect. If you look to the absolute EBITDA, indeed, it is a drop. There is indeed currency in it, as you know, because it was 105 basically in last year, and it is 117 in the U.S. dollar in the average of this year. If you look to the delta, there is indeed a kind of negative impact in the equation of mix, price, and volume. There is, if you compare to last year, of course, a bit of inflation in that one. We did have some additional costs as I indicated. The other one is, and it's maybe a bit technical accounting wise, but we do share the kind of bill of SG&A, across the different segments. That means if you have a reduction of your overall sales, it's also impacting basically the absolute number in sales. Okay. Thank you. Thank you. Our next question this morning comes from Setu Sharda of Barclays. Setu, please go ahead. Yeah. Hi. Thanks for taking my question. One question on the volumes, given the soft Q1 start and the ongoing inflationary pressure on end markets, on customers, has your base case assumption for the volume growth changed in either division? And how sensitive is your FY 2026 guidance to a slower than expected volume ramp-up in Health & Nutrition? And my second question is on the fish oil contracts. Could you clarify how much of your nutrition business is currently sold on a spot basis versus under contracts? And when do the existing contracts typically come up for renegotiation? And could you provide more color on how you are approaching contracting in context of volatile fish oil prices? And my third question is if you can give more info on the trading, how has been the Q2 trading till date, both in FIS and Health & Nutrition? Are you already seeing some sort of recovery that you are expecting? Yeah. Thank you, Setu. Taking your question on H&N, and fish oil. Basically, if you look to the way we are ramping up the H&N volume, and primarily the omega-3, which is the larger chunk there. What we see is that again, across the year. Last year, if you remember, on customer phasing, we had a kind of U curve, and this year it's more a V curve in terms of the contract. This is, of course, the ordering pattern of this business, which is volatile from a quarter to another, although we have this now firm contract position for the year. We have a great visibility on this contracted part. As you know, we are adding more stable sales and predictable sales in both pet nutrition and the human nutrition that is now nicely ramping up. We have, and there we have also very good visibility. If I look to the fully contracted position, this year is very similar in Health & Nutrition to last year, where we have around about two-thirds of our business under longer-term contract, yeah, and one-third that is open. To your pricing question, obviously, on what is open going forward, we have already a proof of evidence that we can pass on already some price increases over the next three quarters. These are roughly double-digit price increases on the open contract related to fish oil. Where fish oil is going, as you know, we've seen fish oil prices going from the low $3,000 per ton, now around $4,500-$4,600 sometimes. This is what we are translating. On the long-term agreement, to your second question, we are really not looking to align our pricing on fish oil only. The aim of the game doing this 2-3 years deal is to have visibility on margin, because then we are hedging our sugar, and we do not want to play the commodity game that fish oil is about. It's about giving really visibility and security of supply to fill the supply gap to our key customers. Some of them, of course, do share that view, others less. This is the way we approach it. Now, on the renewal, to your question, we had a contract that was ending by end 2025 that we have renewed, and the others are ending in 2026. It means that we would probably start next multi-year negotiation for the next years in the course of the summer, to renew this type of contract because they're all ending now by end of 2026. That's again what I could say on that. On the inflationary pressure, this is a difficult one because, of course, we see our customers trying to push also price to retail and to their consumers. Now, with what Peter explained and what we are facing with the Middle East crisis and how we're going to push also our sulfuric cost and extra freight costs, these are really pricing we have implemented wherever now we have open contracts. The vast majority will be implemented as from early H2. This is what we have and what we are planning. Quite a lot of conversation are going on. I have to say that, on freight, it's different from FIS than H&N. In H&N, on this large aquaculture contract, we have a freight clause in all these contracts where we pass immediately any freight surcharge. It's a lot more limited in FIS where you have this lag. There's going to be a 3-month lag to push these prices as from the end of July, early August. Thanks. That was helpful. Just one question, how is the trading update till now? Have you seen the recovery in Health & Nutrition? No, it's pretty good. We have very good visibility on Q2. Very good, and it's really a very strong start of Q2 there. I'm feeling really good, feeling really confident on what we see in both divisions actually already with April. Thanks. That's quite helpful. Yeah. Okay. Thank you, Setu. Our next question this morning comes from Karel Zoete from Kepler Cheuvreux. Karel, please go ahead. Yes. Good morning, gentlemen. Thanks for taking the question. I've had two questions actually in relation to the FIS business unit because the margin has been, of course, a bit lower than expected in the quarter. If we zoom out, it's been a couple of quarters in which profit margins are declining instead of going up towards the 14%-15% ambition level. In relation to that, what are the incremental savings efficiencies, et cetera, you try to capture now? The more longer-term question then is the positioning of the business. Where are you losing market share? Or is it simply the exposure to more mature categories in the U.S. that have been under pressure? Thank you. Okay. Let me do the first one in terms of the longer term trajectory, and then Olivier can take the market one from that perspective. You are right that you see basically a kind of negative momentum if you look quarter after quarter. I don't want to be, but there is always a bit of volatility around it, frankly speaking, a bit of phasing. I don't want to basically go to all these details, but if you look to Q2, and let's start with that, then I did mention we anticipate a kind of EUR 5 million impact of sugar and cost reduction savings. Of which the majority will be in FIS, and that will lead to a kind of sizeable margin improvement as of Q2, following actually an improvement into Q3, Q4. With that one, I think that in terms of Q1, we reached the bottom from a longer term perspective. If you then say the ambition level's still there, I anticipate for the full year to be higher in terms of FIS margin than last year, but not to the 15%. Karel, on the core positioning of the business, this is a very valid question. If you look to the entire FIS, basically, I'm taking it outside the lactic to PLA that is a longer term formula contract. If you look to the other pieces, basically, there is this natural preservation specialty that is where we invest in growth, which is high margin, high growth, and we see even a lot more options around the lactic derivatives, but also the vinegars, the antioxidant, and a lot of food ferments that are growing the mold inhibitors. This is the part we really want to grow and focus on. This is where we are investing in resources, as well. There is the functional systems that basically is transitioning right now from a pure bakery-only play, where we want to specialize in something that has close synergies with preservation, meaning enzyme cocktail, shelf life extension. This is a business we are now really simplifying. It's part of the cost program as well to really simplify SKU's and focus on the high end. This is really one of the big angles on our cost optimization program that Peter mentioned. Then you have what I call the basic derivatives, plain lactic acid that is commoditizing, where. Yeah We basically change the governance, where we run this business now, since January, with a new team in a very lean base. That's the business we also are looking to now restructure, leveraging basically where we have the lowest cost plant in Thailand, and primarily the new lactic gypsum-free plant. This is not where we're going to invest going forward. The aim is really to have this gradual shift in portfolio to the preservation specialties and restructure the functional systems into the shelf life extension and less exposure to bakery-only business going forward. That's our ambition there. Now, as you know, there is still a large chunk of this commoditized lactic acid, or less differentiated, if I would say, which is where I think pricing discipline is important, but also cost management. Back a minute to the FIS margin, as Peter alluded before. We started this program. We presented our new Chief Operating Officer ambition in the CMD as well, where, as part of also the new Exco governance, he kicked off a major program that we embarked on. Of course, in Q1, you see the cost of that program and not the benefit yet. That's fine. We are planning to develop more around that, during our H1 results. That is to come. Very good. Interesting. Thank you. Thank you. Our next call this morning comes from Sebastian Bray at Berenberg. Sebastian, please go ahead. Hello, good morning, and thank you for taking my questions. I'd have two, please. You have talked about, Olivier, the pieces of movement in terms of last expiry of long-term contracts in 2026 for algal oils. If everything were to remain the same as it is today, and spot prices for fish oil were to remain the same, assuming that the contracts expire and are then re-struck, is the pricing effect from algal oils for 2027 roughly flat, or is it different to that? My second question is on the ongoing negotiations regarding your PLA divestment. Are there any dyssynergies to think of here? Because the current setup of contracting is that there is almost an over-the-fence style cost-plus agreement. Is a buyer interested in, let's say, renegotiating that, or do the economics, in all likelihood, remain intact as they are for supply of lactic acid to the PLA JV post divestment? Thank you. Well, thanks, Sebastian. Your Health & Nutrition question is very relevant. Now, you know what we said publicly in the past is that these long-term contracts were, at that time, negotiated between $4,000-$5,000 equivalent. Yeah. Obviously, we need to understand the official price dynamic in the coming month when we're going to be at a table of negotiation in the summertime. Now, having said that, if you compared the official price volatility, we know it has been picking up to $8,000 or $9,000 and going down as low as $2,000 in the past. We believe this type of price level are the longer-term sustainable price of the margin we have and we need going forward, and you know this level. Again, it's a difficult answer because indeed, obviously, as we are growing volume, we have better and better operational leverage, and we should get better margin as we go at this price level between 4 and 5. We believe these are the longer-term right level of prices. Now, let's see what the official price development going to be over the next month, but again, for these contracts, we want to disconnect from official volatility. On the PLA dis-synergies, obviously, and I'm not pitching, of course, the sale of that business, but the combination of this PLA factory next to the largest lactic acid plant in the world and the lowest cost one is very powerful for any new owner of that business. Now, obviously, there is a long-term agreement to supply lactic acid that is in place till 2035, and that would survive any change of control of the PLA JV. For Corbion, whether we own part of the JV or not, it's a very nice plant filler because this business is, as you know, in these huge lactic acid factories, operational leverage is very important, and you really start to make a lot of money when you run above 80%-85% capacity. For us, this plant is a guarantee that we run at a really very high capacity rate. It's quite critical we remain the supplier, and it's the way also to buffer our two lactic plants onsite. Yeah. We see it as, I think, a very nice addition, and actually it's a deal and a contract with very little, if any, cost. It's a pipeline. Yeah, on the front face, the margin might look low, but it has such a huge operational leverage impact on the rest of the lactic that we sell to the preservation and other categories that it's very important. There are no specific dis-synergies that we see from that deal. Thank you. Thank you. Our next question this morning comes from Reginald Watson at ING. Reg, please proceed. Hi, morning all. I'd like to come back to the cost cutting, if I may, Peter. Thank you for giving us the EUR 5 million delta between Q1 and Q2. Could you break that down a bit, please? How much of that is the absence of the cost you had to take in Q1, and how much of that is the cost saving and how much of that is the sugar? A follow-on question from that is how do you expect this to build through the quarters in the year? Is this a one-off cost saving exercise, or do you see further benefits to come in the coming quarters? Yeah. No, thanks. The EUR 5 million, by the way, relates to sugar and cost reduction activities, so it's not even reversing the other, basically, elements. This is a kind of recurring benefit, and I actually think it will increase over the second half of the year as well. Okay. To that, in terms of the language, and Olivier, Peter, feel free, either of you to answer this. You mentioned that the sales strength in Q2 is expected to, quote, "more than compensate for Q1." As analysts, we're too hung up on quarterly volatility. If we look at first half in the round, do you expect then to deliver positive sales, with particular volume mix, for the business as a whole? If I look for, let's say, the business as a whole in terms of volume mix, then for the first half, I do anticipate indeed a kind of positive element. If I look in the combination a bit, then Health & Nutrition, I see a recovery, but that is around kind of the same. If you look in terms of price, I think I alluded in terms of FIS, I anticipate in Q2 still a mild year-on-year price reduction driven by lactic acid to PLA, and then basically reversing of that trend in the second half of the year, driven by the quota which we made on Middle East and parity pricing, that's true. In terms of Health & Nutrition, if I pick pricing, then we had a kind of 4% pricing delta. I anticipate a mild kind of price erosion during the remainder part of the year as well. Final question from me, how is the ramp-up of the gypsum-free lactic acid plant going? Where are you at on continuous capacity utilization? Reg, where we are, as you know, the plant is designed on 125,000 tons of lactic acid. We are now approaching really the 100,000 tons type of level on that plant. Yeah. It's also important that, because we've discussed that in the past as well, it's also because these are significant additional volume we put on the market that it's important we also put that in the market wisely, also making sure that we do not come with large volume that would necessarily impact our margin anywhere. There is a conscious ramp-up that we have as well on this. Obviously, the sooner we can fill it up, the better. We see a very nice upside on the remaining part of the year on, basically PLA that is requiring a lot more globally. That's, I would say, to me, quite an important statement because as you know, the conversion ratio, usually between lactic and PLA is 1.4. You need 1.4 times lactic to PLA. When PLA grows, it's really accelerating massively the need of lactic acid. We see that for our JV, but we see that also for our Chinese players right now. Yeah. That's something that when we look to the whole balance of lactic market, would be really helpful to see how Corbion can leverage, on one side, the fact that we have a competitive position because we are gypsum-free, and you know our main competition is Chinese. The second is, if you look over the last 6 months, there is quite a positive trend in favor of Corbion when we look to the raw cost, the Thai sugar cost versus Chinese cost, and all our competitors in China are on corn. So the ratio is again back in favor of Thai sugar, since September last year. So it's already two quarters. That I think gonna support also Corbion margin going forward. I'm really pleased for you that you're running that plant at 80% capacity utilization because that must be driving efficiencies in terms of. variable cost of production, et cetera. That must make it probably the most cost-efficient plant in the world for lactic acid. Am I wrong with that? No. You're right, but primarily right now with the Middle East, this is the only plant in the world with no sulfuric acid. Yeah? Because the whole story about, of course, as you know, conventional lactic process is that you are using lime and then you need sulfuric to precipitate into gypsum. Yeah. The reason why we developed that process over the years is to have no gypsum, hence you don't need sulfuric. That's a big competitive advantage, primarily these days with what's happening in the Middle East. Does that mean then that the cost benefit of the ramp-up is now already included in the numbers, or should we continue to see more benefit to come from any further utilization, any further ramping of this, through the year? No, we have already factored in our outlook what we think we're gonna achieve in terms of capacity this year. Yeah. The rest we keep for 2027. I mean. Okay. Understood. Very good. Our last questions this morning come from Eric Wilmer at Van Lanschot Kempen. Eric, please go ahead. Hi, good morning, everyone. Yeah, two remaining questions. Brief questions, actually. Given that sugar prices or sugar costs actually have come down year-on-year, might this actually result in market dynamics and forcing lower product pricing for functional ingredients during the remainder of this year? Maybe on customer behavior, are there any signs of, given the current disruptions, customers stocking up your products? You mentioned sulfuric acid supply chain issues. Maybe actually also a third one then on transportation costs. You talk about obviously increasing them. I was wondering to what extent are customers receptive, different from what they may read, energy costs have actually started to come down a bit again, and I've been hearing that this is not always a very straightforward discussion. Thank you. No, I think Eric. Good point. Basically, I think we have, except, I mean, again, in the few larger U.S. contracts, and of course, the joint venture of PLA and sugar-related costs is not something we have really widely spread. Obviously key customers do track, of course, input cost. But in terms of competitive dynamic, today, it's getting really about, as you know, our critical competitors in lactic are in China, and they are based on corn. The important is to look to the Chinese corn versus New York 11 white sugar or Brazilian sugar. That's one, and this is what plays in the competitive dynamic. On stocking, we don't see that because, of course, the situation has been heavily complexified with tariffs and still is. What we see is that the advantage of Corbion being the only lactic producer having a plant in each geography is really helpful for us. There are different dynamics if you look to the U.S. where we have our plant in Blair, Nebraska, and in Brazil, in Campos dos Goytacazes, in Thailand. We do not anticipate any extra customer stocking. On the opposite, we see people being so tight on working capital that we have a lot of rush orders, a lot of last minute, which are creating other issues. That's what we see. On freight cost, yeah, of course, as I said, Health & Nutrition is very different than feed. In Health & Nutrition, all the large contracts do have a freight clause, so that we review on a quarterly basis. If freight costs are, let's say, improving or declining in the next quarter, we would apply it and vice versa. In feed, it's very different. As you know, we have a big route that is impacting Corbion, where most of the European lactic acid is freight from Thailand to Europe. This is a very large volume because this is the feedstock for all the derivatives we are making in our Spanish and Dutch operations. That's an important one for us. Where basically we have no choice but to push these extra freight costs to the market. This is what Peter explained, what we are busy doing and what we have to do. Very clear. Thank you very much. You are welcome. Okay. This concludes our conference call this morning. Thank you all for your attendance and questions, and we look forward to discussions at upcoming conferences in the next weeks. Please note that we'll hold our annual general shareholders meeting on 13 May 2026 in Amsterdam, and our Q2 half year 2026 results on 31 July. Information on both meetings is available on the investor relations page of our website, and we look forward to engaging with you again. Operator, you may close the call. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.