Hello, and welcome to the ForFarmers Annual Results. My name is Jess, and I'll be your coordinator for today's event. For the duration of the call, your lines will be on listen only. However, there will be the opportunity to ask questions. This can be done by pressing star 1 on your telephone keypad to register your question at any time. If at any point you require assistance, please press star zero and you'll be connected to an operator. I will now hand over to your host, Caroline Vogelzang, to begin today's call. Thank you. Thank you, Jess. Good morning, all. Welcome to our audio webcast, which you are accustomed to, in which we will present the 2022 results of ForFarmers this time round. One message up front. Unfortunately we have to announce that Theo Spierings, our CEO, has suddenly had to tell us that he will not be here today due to personal circumstances, which we find very unfortunate and unhappy, but we of course, have full understanding for this unfortunate circumstance. Roeland will therefore be leading you through the presentation and Pieter Wolleswinkel is also on the line. The presentation has been published this morning, as you're accustomed to. It's on our corporate site. We're doing this call obviously in English. I'm speaking English at present. The presentation can be followed through this webcast. The audio tape of this call will be posted on our corporate site afterwards. Also, as you are also accustomed to, we would like to draw your attention to the disclaimer statement in which we state that everything we're saying today is based on the knowledge that we have today. We all know that the last couple of, well, the last year, basically, that the world can change in a split second, so please bear this in mind. With that, Roeland, I'd like to pass the floor to you. Thank you, Caroline. Good morning, all. I will indeed guide you through the presentation. We will start with the highlights of 2022, then some specific specifics for the market we are in, and then I will take a deep dive into the results and with the strategy update. Let's start with the highlights over the last year. Well, to state the obvious, and you can see that in the mid-sector in the green part, that 2022 was obviously materially impacted by the war in the Ukraine. What we have seen is that there was quite a issue with the availability of raw materials, but also the pricing of raw materials and especially grain. We saw that there was lack of availability in Q2, a lot of discussions at the time and we saw prices being volatile throughout the year. The same goes more or less for energy and especially on electricity and gas. The good thing is, and we are proud of that ForFarmers has been able to smoothly provide our customers, our farmers, with compound feeds. Our operations went smoothly during this process. 2022 was like 2018, a year with a dry and warm summer. This has led to a lower water levels in the Dutch canals and rivers, which of course impacted our operations. More transportation on road instead of on the rivers. That had also an impact on our results. Unfortunately, the last couple of years, we have to report that, our operations are impacted by animal diseases. Also this year, we see that the outbreak of avian influenza in some of the countries we're in, especially in the U.K., Netherlands and Poland, is hampering our volume, but also the impact of the African swine fever, which we have been seeing in Germany, is something we need to deal with, especially because of the lack of exports towards China out of Germany and European countries. As you can see on the left-hand side, the top blue corner, the ForFarmers EBIT and EBITDA is only slightly impacted by all of these effects. It's -2.7% on EBITDA. The good thing is, if you look at our net profit, the underlying net profit, as you have maybe been seeing in our press release, and I will also highlight it later on, it's 4% up. If you look at the underlying net profit, what will be added to our equity is EUR 4 million up, which is 46% higher than the year before. Also on this slide, and I will also discuss it later in our slides, is that at this year, we will propose to pay out a dividend of EUR 0.20 of the ordinary share, which is 60% of our underlying net profit. Last year as you are aware, we paid EUR 0.19 normal dividend, so it's EUR 0.01 extra. We paid last year EUR 0.09 extra dividend, which we don't do this year. On the right hand side, you see that the prices of our farmers, the products of our farmers, so milk, meat, and eggs have been rising throughout the year, which was needed because of the higher raw materials we needed to have price inflation in the value chain. This was very difficult for us in Q1. As you might remember, the Q1 was not the best results for ForFarmers. As of Q2, we see that for the most of our countries, not all, that we have been able to pass on the higher raw material prices and energy costs towards our clients, and our clients were able to absorb these costs and have their prices for their end products also at a higher level. Unfortunately, that's not the case for the pig industry, the pig sector, because of the cost of feed is at a higher pace than the end product pricing. We see that there's quite some turmoil over there, and that our pig farms or the pig farms at large are suffering from that situation and are lacking cash. Maybe also good to mention on the left-hand side, blue corner again, that last year we did the acquisitions of De Hoop and Mühldorfer, which are now truly ForFarmers companies and contributing to our results, and we are satisfied with that. We also announced just recently that we have to stop, or that we decided to stop, and we discussed that with our partners in the U.K., to stop the proposed joint venture with 2Agriculture. We made the analysis of the cost to be paid in this long process. As you can imagine, a CMA process takes time, and you need advisors there. That comes at a cost. More importantly, we also thought about what kind of remedies do we need to offer to the CMA in order to get this joint venture over the line. That's the likelihood of that together with the remedies, we decided that it's better for us to stop the proposed merger, and that's what we announced just recently. Maybe one item more to mention on this slide. You've seen that our executive report is at full power. Again, we have the new CEO, Theo. Unfortunately, he's not here today, but I can assure you that he's up and running and making an impact in the organization. As you are aware, we launched our Strategy 2025 just recently in November. I will highlight where we are with the strategy later on this morning. The next slide, you will see the market developments per country. Let's start with the Netherlands. I think it's not a surprise when I say that a lot of discussion is going on the whole nitrogen issues in the Netherlands. As you are aware in for the Dutch-speaking people, there was the report of old minister Remkes, is a kind of a mediator and to get alignment within the agricultural segments. Based on that report, now our provinces in the Netherlands are working on an agreement to get an agreement with all the stakeholders and in the value chain. We hope that's the expectation from the ministry that before the summer or around the summer, there is agreement and we know and all people will know what will happen to nitrogen and how to solve that within the Netherlands. This year, the Netherlands was also impacted by avian influenza. We saw that, for example, in the layer business. That of course impacted the performance and the volume for our company. The pig sector at large, like I said, is material impacted there. We have the stoppers arrangement. We have the warm restructuring most recently. That all impacted the number of animals in the Netherlands, which has declined significantly compared to 2021. The same goes more or less for Poland. sorry, so for Belgium. In Belgium, we see that the declining of the pig herd is enormous and we have been shrinking in line with that. By definition, that has an impact on our results. When we look at Germany, we see that the export ban for pig meat from Germany towards especially China has basically stopped. There's less and less exports towards China. China is almost self-sufficient. That's impacting the pig business in Germany. The good thing in Germany is that we see that robotic milking is getting more traction and ForFarmers is well equipped to be the front runner there because of our knowledge and capabilities in this sector. The Polish operation has been, or the Polish country, the Poland as a country, of course, has been impacted by the Ukraine situation. The dreadful war has impacted not only our operations, but also normal life in Ukraine obviously, but also in Poland. A lot of our colleagues in Poland have t aken in indeed. Thank you, Caroline Vogelzang. Taken in people from Ukraine in order to help them out. But from a volume perspective we've seen that export from Ukraine towards other countries, especially in Q2 and Q3, were on a lower level, and Poland stepped into that gap and produced much more poultry meat and our operation, as you will see later on, also benefited from that. The U.K. was impacted in the first half with lack of personnel in a lot of the slaughterhouses and in the value chain because of Brexit and Corona. You might almost forgot about it, but there was still Corona in the first half. That impacted the way of working in the value chain. Also here, it's a repetition of the other countries, more or less. The pig sector is suffering a lot at the moment in the U.K. because of lack of profitability in that sector. And we have seen that there is 50% less sows in the U.K., which of course will impact piglets and fattening pigs going forward as well. Those were the highlights, let's say, per market for the countries we're in. Let's dive into the financials a bit more and go to the EBITDA development. As you are aware, we always compare 2021 to 2022 or the year, first to last year, and we divide our analysis in three different buckets, FX, M&A, and like for like, the autonomous growth. Well, FX and M&A are quite limited. The Polish zloty and the British pound compared to the euro didn't have a material impact in our M&A, and it's a contribution of Mühldorfer. De Hoop were only for a couple of weeks in this year. Because after we only track the M&A for a year as M&A, then it will be more our like for like business. If you look at like for like, you see that our total feed volume is down with 6.8%, whereas our compound feed is down with 6.8% and 8% down for compound feed. Basically, that means that our DML business, our moisture and liquid business, that is the co-products and the residual flows are on a slower decline than our compound feed, which is positive in that view, and they are contributing nicely to the results. Also in our strategy when it comes to Going Circular, circular thinking, it's important that we give another value to co-products and residual flows. The 8% decline in compound feed is especially in the pig sector. Good to also highlight that in our ruminant sector, we have seen stable volumes with increasing market shares for both the U.K. and the Netherlands. Also poultry has done a good year when it comes to the broiler sector. The broiler sector was very stable in the countries we're in, but growing in Poland. That's because of the Ukraine war, and our layer business impacted by low profitability for the layer industry, but also impacted by avian influenza. Gross profit, as you can see, has increased with 13%. Despite the volume decline, our gross profit was up. As you are aware, that is also needed because we need to take care of our operating expenses. We were able to pass on higher raw materials for the majority of our countries, but also we had to take care of higher energy costs, and the energy costs are part of our operating expenses. If you look at the operating expenses, you see that it's gone up with EUR 60 million, six to zero, and predominantly that's energy. The energy, of course, that's gas and electricity, but also our transportation cost has increased. As you can see in our annual report, which is online since this morning, has increased with about EUR 7 million. We also out of prudence provided for a little bit more on our doubtful debt, the allowance for bad debts. We added around EUR 3.5 million More to that provision in order for prudency to see what our, if our clients can pay yes or no going forward. The last part of the higher operating expenses is, of course, personnel cost. It has increased because of the wage inflation and also because of higher number of people in our operations, especially in Poland, because of the higher volume. If you put it all together, you will see that our EBIT and EBITDA effectively are lower than the year before. I would say it's a solid result. Talking about solid results, let's go to the profit development, a bit lower if you look at our P&L, our profit and loss account. Let's pick some items out of this. Let's take the underlying net finance result. On average, we had a higher net debt. Higher net debt comes at cost. That is interest. That's why interest went up a bit, but also because of increasing levels for EURIBOR, LIBOR, and importantly WIBOR, that has also increased significantly throughout the year. That's why our interest charges, our net finance results are higher than the year before. Our 50/50 joint venture, every nice word, the profit of equity accounted investees is our operation of in Germany. It's a 50 joint venture. It's called HaBeMa, contributed quite a lot. The majority of the EUR 4.1 million is HaBeMa, and they are on a very high and I believe even record high result for last year. Adding to our bottom line. Tax expenses had come down basically because of settlement of previous years. To put it into perspective, last year, the tax expenses were higher because of the change in the tax rate, especially in the U.K. We have a separate slide on our incidental items, the APM items. If you would take that out as well, then you will see that our profit for the period at the bottom of the slide is EUR 80.2, which is about 46% higher than the year before. The profit ratios. The underlying earnings per share, the EPS, is in line with last year's, EUR 0.01 higher than last year. It has to do, of course, with the higher net profit, but also to do with the share buyback we have been doing this year. We bought 4 million shares for the amount of EUR 15 million. I know you are aware that we stopped that in early this year, that has an impact on the EPS, the earnings per share. Effective tax rate, of course, went down because of the lower tax expenses. That helped. You will see that our ROACE, whatever you want to call it, is on 7.8%. We are aware that we have to do our homework going forward because we want the ROACE to be at 10% in 2025, and that's 10% on EBIT. That is our goal for 2025. Let's look at our balance sheet. We see obviously that the total balance sheet, the total assets has increased because of higher raw materials again. That has an impact on inventories and receivables. Also there, to put it into perspective, you might have seen that our cost of sales, our raw materials have been increasing by about 25%-26%. That's what you see reflected in higher debtors and higher receivables as well. If you look at the equity, it's has increased with EUR 22 million. The EUR 22 million is basically three elements. One, the share buyback program lowered our equity. That's EUR 15 million. The second item is the dividend, which we paid out EUR 26 million last year. Again, it's the normal dividend and the extra dividend, which we paid as the dividend of last year. Of course, the cash out was in this year. We, the third element, we added the profit. Our net profit has been added, of course to our equity. We are the total EUR 344 million ForFarmers at the end of 2022. Working capital, as you can see over here, is stable. One word of caution here is that our trade working capital, so that's only receivables, inventories, and creditors, has increased with about EUR 60 million-EUR 70 million. The total working capital, that's including other receivables and other payables, if you include debt, then you see that working capital is at more or less the same level, a bit higher than last year. Total, the trade working capital has increased by a lot because of higher raw materials again. The overdues is again declining from 11.6% towards 10.6%. A job well done by our clients, I would like to highlight. Of course, the people working with our clients that they were able to make sure that the clients paid in time. Still 10% overdue, but declining. If you look at the declining scale over the last couple of years, it's year-on-year, we are improving. That is a job well done by a lot of people, and especially by our clients, that they are able to pay even in these difficult times, which we have seen the last year. The last item on this slide is the net debt. Net debt has increased with EUR 40 million. You will guess already that it has to do with the impact of the share buyback program, which is EUR 15 million, a higher dividend or the high dividend we paid out last year, and the money we had to invest in our working capital. That's why debt came up with EUR 40 million. Cash flow development, only some words. I think we basically touched on all of them. Operating activities impacted by trade working capital, obviously. The net cash flow from investing activities for this year is our regular CapEx, our regular capital expenditures in our several plants and mills we have around the five countries we are in. Last year, this number included the acquisitions of De Hoop and Mühldorfer. The net cash flow for finance activities is impacted by the share buyback program, which we stopped in March. It cost us EUR 15 million. This is the APM items, alternative performance measures. We try to divide that, and we succeeded in four different buckets, impairments, business combination, divestments, restructuring, and other. I will not mention them all. You can see them for yourself in our press release. There's a lot of guidance there and also in our annual report, which is, like I said, on our website since this morning. The biggest one being in the business combination divestments. There you will see on the line EBIT a EUR 9.9 adjustment. The 9.9 adjustment has to do with, as you are aware and discussed also in previous years, amortization of acquired clients. It's more or less the same as in last year. As you are aware, if we buy a company, we have to valuate our clients, and we can amortize, depreciate that, and we don't see that as an operational result, and that's why we take it out, and we see that as an APM item, so we have a better view on our operational results. In total, this APM items are much lower, EUR 5 million lower than last year. I would like to spend some time with the three different clusters we're in. The Netherlands, Belgium, Poland, and Germany is a cluster, and the U.K.. What you can see in the Netherlands, that volume came down especially because of the pig sector. Don't forget, like I said, you see stable volumes in the rumen sector and increasing market share, so positive. You see positives also in the poultry sector. The layer, like I already alluded on, the layer business is impacted by, for example, the avian influenza. Reudink also served a bit of consumer behavior had lack of the organic products to be sold in supermarkets, and of course, by new legislation. We think that Reudink is well equipped to deal with the strategy going forward, given that our European Union wants to go to 30% on organic agriculture in the near future. You cannot see it on this slide, but our horse feed business called Pavo has also increased their profitability and is nicely contributing to the EBITDA for this cluster. Gross profit, as you can see, went up with EUR 20 million, that's quite nice. We were able to pass on raw materials, but not at the extent that we wanted to, especially in Q2. We started with that, but Q1 was quite impacted by the higher raw materials and energy costs, and we were not able to pass that on fully. You can see that as well. You see EUR 20 million higher gross profit, but even EUR 32 million higher operating expenditures. The higher operating expenditures, again, has to do with higher energy prices. If you put it all together, higher gross profits, but higher, at a higher level, operating expenditures, of course, our EBIT and EBITDA came down, but still at a very decent ROACE of about 18% on EBITDA and, sorry, 70% on EBIT for this cluster. EBITDA is higher. The cluster Germany and Poland, a bit of a mixed bag as always, because we see declining volumes in for swine, in the pig business in Germany. We see an increased volume, of course, on the poultry sector in Poland because of the less export out of the Ukraine for poultry meat. Like I said, Poland stepped into that gap and is of course contributing to higher volumes in Poland for our ForFarmers feed business. The total volume went down with about 8%, but you can see that our gross profits increased quite significantly with EUR 25 million compared to last year. Basically, we were able to pass on raw materials in the value chain, but also because of good margin management, what we have seen in Germany and Poland, and of course, higher volumes in Poland helped with the higher gross profits. Last year, you might remember, we had unfavorable contracts in Germany that cost us the company EUR 4 million, of course, also has an impact if you do the like for like comparison on the results for this cluster. EUR 25 million gross profit higher than the year before, EUR 11 million down when it comes to the OpEx, again, predominantly on energy. This cluster had a fantastic return, so to say, on EBITDA and EBIT. It increased with EUR 40 million on EBIT and getting to ROACE numbers, the return on average capital employed for this cluster above 10%. To the cluster United Kingdom. This is the cluster where we saw that the decline of volume was limited compared to the others. This is 4% down, so it's less than the others. It had to do with good performance in our broiler sector and in the ruminant sector. Like I said, we were able to gain market share. The difficulty is of course in the pig sector, even in or even as well in the U.K. Last year, for the like for like comparison, last year we lost a big client, which was there for four months in 2021, and not anymore in 2022. That's why there's also deviation for the pig sector. In this slide you can see that the gross profit, but also the underlying expenses both end up with EUR 40 million. That basically means that our underlying EBITDA and EBIT are on the same level, or more or less the same level, a fraction above last year. That is a good performance. But our ROACE number is not at the desired level because it's at 2% on EBIT. If I try to summarize our financial performance on this slide, the key data, revenue above EUR 3 billion, driven by higher raw materials, it's 25% up. Like I said, we will propose to our annual meeting of shareholders to pay out a dividend of EUR 0.50, which is 60% of our net underlying profit. As you are aware, more and more we want to go towards integrated reporting. You see in the green part of this slide, our, let's say, KPIs on the non-financial items. Greenhouse gas emissions, a good performance again, down towards last year. Also the LTIs, our lost time injuries, the casualties, so to say, in our plants also came down. That is good performance on these non-financial items. To our update on the strategy. You were aware of, most of you were there. We, on the 17th of November, we came with this new, renewed strategy. Renewed strategy, so to say. We came up with these five principles which you are aware of. Now, we are of course starting with execution. It's a pity that Theo Spierings is not here today, because his heart is of course in the execution of the strategy going forward. Given his background in the agricultural sector, but especially also in the company which he founded, called The Purpose Factory, his heart is on ESG at large, so environmental, social, and governance. He's helping there and he's bringing guidance and traction to especially to provide sustainable solutions, that's close to his heart and his. Yeah, he wants to make a difference there. Also when it comes to working together more and more in the supply chain, both with competitors but also with processors and slaughterhouses, that is also close to his heart. He wants to collaborate there going forward as well. This strategy of course will come with also adjustments in our organization. We are already starting with reshaping, so to say, our operational design. And one of the items there is that we want to have more emphasis on ESG, on the sustainability part. We have a new cluster now with Reudink, our organic feeds company, with our M&L business, which is the moisture and liquid business, the co-products or residual flows, together with building new concepts for our farmers. We highlighted that already in November, and now it has been dealt with. We have this new cluster now going forward on the new leadership as well. Sustainability, the heart as always of our operations, heart of our strategy. I think for you guys it's not a surprise that animals and feed for animals are crucial for a circular approach. We have been, we mentioned this in our annual reports over the last couple of years. As you are aware, we need animals and to get a good valorization of plant-based proteins in the industry in order to create also c ircularity in our processes. As you have seen in our annual report there, we have about 76% of what we use is non-human edible. That's our products which we as a human cannot digest and animals can. This whole valorization is very important that we give value to stuff that we as humans cannot digest. Basically, in every, or sorry, not in every, in every way you want to look at this, if you want to go circular, you will need animals going forward, and animals need feed. The last slide is about our integrated objectives. Like I said, we believe that it's not only about the financial targets, but also about the non-financial targets. We are growing towards the CSRD, the Corporate Sustainability Reporting Directive, which is mandatory for listed companies as of next year. We have a task force there to get it organized this year, so much more reporting on non-financial items. It's basically on e- sustainability at large. Here you can see already what we have been doing for the last year and a couple of years. These are our ambitions, but also on Going Circular, which is basically a bit of the whole ESG equation. These are our targets going forward. We believe, every, we want to invest in people, so development of talent is important. Of course, the whole Going Circular, you can see that in the green bar, is in the heart of the operation. In the end, we all want to create value and we have been guiding that we want to grow to a 10% ROACE on underlying EBIT by the end of 2025. Like I said, homework to do. We want to pay out a dividend of 40%-60%, and we are proposing that to our shareholders also this year, based on our underlying net profit. That, I believe, let me see, this is the last slide indeed. That sums up the financials for 2022 and the highlights of 2022 and the update on the strategy. I think with that, looking at you, Caroline, we can open up the floor for questions. Absolutely. Jessica, could you open up the floor for questions, please? Of course. If you would like to ask a question, please press star one on your telephone keypad. Please ensure your line is unmuted locally, as you will be advised when to ask your question. Once again, that's star one if you would like to ask a question. Your first question comes from the line of Guy Sips from KBC Securities. Please go ahead. Yes, thank you. I have a few questions. First is on the welfare concepts for broilers to retailers. How is this trend evolving in other countries than in the Netherlands? The second question is on the doubtful debt provisions. How do you see that evolving into first or into the start of this year? You were discussing or you were claiming that you're improving your market position in the cluster Belgium, Netherlands. Is that specifically in the Netherlands or also in Belgium? A last question is on your ROACE target of 10%. This improvement, should that mainly come from the U.K.. As this is still below this 10% or should it be all over the place? Thank you. Pieter will tackle this question on the welfare concept. Let me start then with the doubtful debt. There are basically rules under IFRS how to cover the provision for doubtful debt, especially in the pig sector. You've seen our clients struggling with on time payments and you see also some defaults here and there, but limited in our organization. We are more or less prudent in our provision. The year has started, of course. February is almost gone, but no big defaults yet. That is positive news. We are, in my view, on a good way provided for doubtful debt. Pieter will also discuss the market shares for the Dutch and Belgium organization. When I said we were gaining our market share, that's predominantly in the ruminant sector, and probably less in the others. Pieter will highlight that. On the roadshow numbers, you are right. U.K. is below that target of 10%. Indeed, there will be some stuff to do in the U.K. We are a company of five different clusters, and there's also ability and willingness to do M&A. We have a leverage of around to one, so there's still room to invest to get to these ROACE numbers. You're right. It should come from all clusters. We see that the other clusters are delivering. But as always, and it's a good thing of a balanced portfolio, if one is lacking behind, the other ones can help. For sure, we are, we will talk, and we are talking to our managing directors per country, and all of them are aware that they should live up to these internal targets of higher ROACE. To answer your question, it should come from all sides. Every now and again, country A will help country B. Maybe, Pieter, you can answer the questions on the welfare concept and the market share. Yes. Yes. If I start with the first one, the welfare concept, we see that Europe has committed themselves to, as they call it, the European Chicken Commitment. That is already a step forward to the current situation that in Germany and Belgium will also lead to less chicken per square meters. That is still not as progressive as what we see in the Netherlands with the movement to Beter Leven 1 star. We foresee that in Germany and Belgium, that step will only be made if specific retailers will start with it. We see some movements in the Belgium market, for example, from Colruyt. We are also in cooperation with that party, it is clearly behind the progress that has been made in the Netherlands. We see more and more movement to that situation. If we look to Poland, that is very much you ask, we deliver approach. Depending on the consumer market, the retail demand, that determines their way of housing and the way they export the broiler meat. It is clearly a trend that will be ahead of us. If I go to the second question on the market shares, and specifically also for Belgium, we see that we have intrinsic ambition to grow our market share, but also to make choices. For example, in Belgium, we have announced last year the closure, or in that we announced it already in 2021, the closure of one plant and the renovation and upgrade of another plant. By taking that step, we will focus in the Belgium market with production on pigs and on ruminants. We don't produce local broiler and layer feed anymore given the lack of profitability that we recognized in that region. By taking choices, we do not grow ourselves as a whole in the country, but per segment, we have the ambition to grow. Like Roeland said, especially on ruminants, we are very satisfied on the proposition we deliver to customers, the advice we give. especially in that field, we've made good step forward to 2022 to grow our market, shares. Okay, thank you. The next question comes from the line of Daan Arends from Kepler Cheuvreux. Please go ahead. Good morning. Two questions for me, if I may. Maybe firstly, the profitability in Germany, Poland, it's a big step up, actually hitting the ROACE target, so very impressive. Should we expect these profitability levels going forward as a new normal? Or do you think things will normalize or mean reverse as you will in the coming few years? That's the first one. The second one is on strategic partnerships. We know that the joint venture in the U.K. did not happen. Is there any other initiatives that you would like to highlight here? Maybe also your opinion on the P&P set forth by the ACM director in the Netherlands that agricultural parties should do more price coordination in that light. Thanks. Thank you for your questions, Daan. I will start. Pieter can already think about the question of the ACM, which is focusing on farmers. I will dive into your other questions. Unfortunately, the answer is no. This is not, there were some exceptional results in Poland because of what's happening in the Ukraine, and that's why volumes and margins went up enormously. Of course, we are hoping and we will do our best this year. As we see now that there's a lot of export, again, out of the Ukraine, at lower tax rate, import Import terms. Import tariffs. Thank you, Daan. You're right. The import tariffs in the Ukraine. Basically our Polish operation will get back to other levels than we saw this year. Germany, because of the we didn't have this unfavorable contracts anymore, has come to more profitable levels. Like I said, we see growing volume for in the ruminant sector, especially robotic milking. That's helping our operations there where it's, where we see declining markets for the pig industry. To strategic partnerships, to answer your question, yes, we are looking at more initiatives. Also, no, I will not tell who and where. As you might be guessing, the joint venture in the U.K. is, of course, only one out of the whole equation. We, in our strategy, and we have been stipulating that we believe working together in the value chain, but also with partners, like we have, for example, in Poland, where we are closely working with a partner, but also in the Netherlands, for some of the product lines we're in. We believe in partnerships and we believe in strategic partnerships, but we also believe in M&A by itself. Yes, we are working on more initiatives. No, we will not guide you exactly where and how. Then maybe to the question of Pieter, for Pieter, when it comes to the opinion of the authority ACM on working much more closely together on pricing. We were satisfied to read the message sent out by the competition authority because we see that making the transition whenever, even when it's about climate, when it's about welfare, this will definitely help if you can make agreements all through the chain on how you come to a fair pricing model. This is also fully in line with our ambition that the food chain and the agri-food chain takes its responsibility to move from A to B. This would be supportive. On the other hand, we are somewhat, too, reluctant to be too positive because only some years ago, an initiative in the broiler chain was rejected by the competition authority. In 2020, they re-revised it, and at that point, they came to the same conclusion that it was the right decision to say no at that point in time. My question would be, what is now so different legislation-wise in three years that this will really come to openings in the discussions? Summarizing, we are positive about that. On the other hand, if we really come to an execution phase. We are not sure yet what this exactly means and how much space there will be, especially in a environment where imports of foreign products is always a risk if the pricing of the domestic products is too high, and that is what we have warned before that we need to be very careful that we really take good care of our agricultural business because we do believe that the way it is produced in the Dutch situation is the most sustainable way to produce. We want to capture that towards the future. All in all, a very interesting movement. Okay. Thanks, guys. That's very clear. The next question comes from the line of Fernand de Boer from Degroof Petercam. Please go ahead. Yes, good morning. Fernand de Boer, Degroof Petercam. A couple of questions my side. First of all, on the energy cost, you see in the annual report that was up from, let's say EUR 41 million to EUR 77 million. Could you say anything about your energy contracts for 2023? Could we see a similar kind of step up or is the EUR 77 million actually going down? That's the first question. The second one is actually coming back on the ROACE question, maybe the U.K. going up. If we see certainly in the past year, I think the main problem was the decline in the Netherlands, that's already down for a few years now. Maybe to get the weakest up isn't a solution, but I think to get the better, best up could even be a better solution. What could we expect for the Netherlands of Netherlands, Belgium going forward? That's the second question. On the quote Theo Spierings has made in the press release, let's say, about being satisfied, being happy with the organization, but at the same time still saying we need to make adaptations, but especially what he actually said that, you know, that on the industry or on the how do you say it? That actually is, yeah, quite amazing how the industry is thinking, et cetera, and that should change. What should change in his view and what could ForFarmers play a role in that part? I think it's very tough to change that industry. Yeah. Thank you for your questions, Fernand. Yeah, thank you, Fernand. Thank you for your questions. Pieter will think about already the Dutch and Belgian, and how to get it to the ROACE numbers. But I will also give my perspective there. You're right. We are not only focusing on the U.K.. Of course, we see, as you have been seeing that the trend is down for the Dutch and Belgian operations. It also has to do with the decline as you have seen, in the pig sector, which has been enormously in the last couple of years. Going forward, of course, we need to see what will happen to the whole nitrogen discussion and how that will impact our operations. With our new strategy, which is about local in the lead, we are changing the way we perceive different product market combinations. No one size fits all. More specific, we will have a strategy per specie, per country, sometimes even per region. That will help in getting profitability at all the levels than today. Before handing it over to Pieter, your last question is valid of course. I can of course not speak for Theo, the discussions we have been having with him is that, yeah, like I said, it's close to his heart that what's happening in the industry at large. He sees that in the Netherlands, a lot of discussions are on nitrogen going forward. He's also trying to highlight that there is a place for circularity, there is a place for animals and animal feed within Europe and that we should look for opportunities and capability in Europe itself. He also has a strong view on what's happening in Brazil when it comes to deforestation. He's putting that together saying, "Well, we as an industry should have an answer to that, not only for Europe, but also for, let's say, the community at large." He wants to cooperate with people in the value chain, both up and down, so to say, and left and right. With competitors, with other players in the industry, with farmers, with retailers, with others in order to get this important problem solved. He's very aware that we need farmers, we need animals for the whole circular thinking, and that there is a place for a company like ForFarmers going forward for sure. Maybe that is a good segue into Pieter, your perspective on getting ROACE levels in the Netherlands, which are already very decent, but that it doesn't decline. Yeah. For energy costs. Sorry, I forgot about that part. I forgot about the energy. Excuse me, Pieter. I think you are aware that we changed our policy. We in the old days, before the Ukraine, but also the energy crisis which already started earlier than the Ukraine issue, we changed our policies there. In the old days, energy was not even talked about in the budget. Now we start with energy more or less, after we discussed the raw materials. We changed our policy that we are putting layers, several layers of energy hedging for the different countries we're in. Every country local in the lead has their own policy there within our framework. Yeah, I will not highlight whether it will be higher or lower or provide guidance on that because that's also, as you are aware, information our competitors would like to know if they know what we have our positions on energy. I will not go into that, but you can rest for sure that we change the policy and in our view, we are, yeah, you never know, of course. For now, we have to view that we are well, well balanced in our energy cost for 2023. I will hand it over to you, Pieter. Okay. Can you then say what the average length of the hedge is? Sorry, what? What the average length of the hedge is. No, I will not. It's depending on the markets we're in, Fernand. We have layers which are more than, let's say, one or two or three months. It will go too far to say per country how far we are, because that is competitive information which is very valid for our friends around us. Yeah, you have to, yeah, this is my answer, so to say. if. it over- Maybe because if you cannot comment because of this competitive sensitive information. Yeah. If you then take the comment of Theo Spierings to say, "Look, guys, together we have to think about the entire sector," that's never going to work then. Yeah. Now you're putting two things in the equation, Fernand, which is of course allowed, but I would say that being transparent comes from two sides then, huh? We are very transparent in our annual report and quarterly updates and, well, I presume you also look at some of our competitors and their annual reports. We are quite transparent there. When Theo is talking, he's not talking about transparency on energy costs, he's talking about working together on solving all kinds of problems within the industry. That doesn't necessarily have to mean that we provide guidance and transparency on all specifics of different lines in our P&L. Yeah. Okay. Thank you. Pieter. Yes, yes. Yeah, Fernand, I like your challenge. We should not only look at the ones that are relatively low on ROACE. For me, the strategic principles come back in this discussion. We say local in the lead. That means that per country, we also look what a reasonable target is for ROACE. That is the same way we approach the Netherlands, and that is clearly not 10%, but much higher. That is also the ambition for the coming years. How to achieve that in left or right, a challenging environment. The principles out of the strategy come back first. Also the sustainability agenda. We truly believe that sustainability also offers opportunities for ForFarmers. We are very well positioned with our organic company, Reudink. We are very well positioned for the use of co-products. Only two examples, and we also think that with all the know-how we have nutritionally about raw materials we can use, this is also a way to improve our results. That is one. On the other side, we are a company in an environment where the volumes will go down, and that means we need to have control over our costs. Also moving to a lower cost base will be a fundamental movement for the coming years to improve the profitability. Clear on that, the ambition is that we have a very attractive ROACE on the Netherlands also towards the future, and the agenda is made for that. Okay. Thank you very much for the answers. Clear. The next question comes from the line of Anne-Maree Crow from Edison Group. Please go ahead. Good morning. Thank you for taking my call. I've just got. Actually, I'm really sorry. I'm going to have to pull out of the queue because I have to go on another call. Can I email a question in and speak later? That would be great. Thank you. That's fine. Bye. That's fine then. Thank you. Bye. Bye. The next question comes from the line of Eric Willegers from ABN AMRO- ODDO BHF. Please go ahead. Hi. Good morning, everyone, and thanks for taking my questions. I was wondering if you could talk a little bit about your thoughts on potential net working capital relief this year as supply chains are gradually easing. Do you expect your inventories and receivable positions to improve this year after a pretty notable step up last year? Secondly, I was also wondering if you could talk a little bit more about your M&A activity, or maybe taking it a step broader towards M&A activity in this sector at the moment. I think obviously smaller companies must be in even more difficult positions right now, and we've been talking about this for some time, but deals still do not really seem to materialize. I was wondering, what are your thoughts there? Thank you. Indeed, working capital levels are coming down because raw materials are coming down. We see grains, for example, like the wheat, is declining. Last year it was above, on average, above EUR 350, even EUR 400 during the summer. Now, nowadays it's below EUR 300 already. You never know what will happen, of course. It depends on the harvest, depends on macroeconomics. If the trend will materialize and continues, then we will see lower working capital levels. It also has to do with the growth, for example, in Poland, that will not change. We want to grow in Poland has longer payment terms than the other countries. Also, we've seen that we are growing, for example, with Turkey and some of our countries, and Turkey by def-- not by... Yeah. They, they have a longer cycle, and most of the time we see also there are longer payment terms. You're right. Back to your question, there will be some relief when it comes to lower levels of, especially wei- the grain perspective. To M&A- Sorry to interrupt. Do you expect this to be mainly in H1 theme, or is it bit, little bit difficult at this stage to? Yeah, it's difficult at this stage. We don't have a glass ball. It's depending on, like I said, macroeconomics. What will happen to Ukraine, if there's a hiccup again and there's no harvest, or no transport out of the Ukraine, then. The same goes for Russia. Of course, a lot will happen again. It's also depending on the harvest in the countries where it comes from. We don't provide guidance on that, Eric. Then to M&A, you're right that the, There are a lot of companies much more thinking about their future than, I would say, a couple of years ago. If you have a single plant in one of the countries in the pig sector, you're not well off. Yeah, we have been seeing the last couple of years like the acquisition we've done with Hope, and that we only take M&A targets in the countries we're in when they are appealing to us. We, of course we, as one of the front leaders in the whole consolidation, we will be there, but not at all costs, we will not take all parties just for the sake of it. Don't forget, a lot of the smaller companies are privately owned or family-owned, and they have a long, long life, so to say, when it comes to their equity. Only when the cash problems are that big, then you could question whether you want them, and sometimes we will, because sometimes it's good to buy a company and close one plant of ourselves or one of them. We indeed see targets. Don't forget, we want to grow, and we will be part of the consolidation in all the countries. For, especially, with, for example, Voden in the U.K. is a country where we want to improve, and also in Poland. What we see is one of the growth areas in the countries we're in. But still, and unfortunately, you didn't see it in in the last year, I can explain that we had a lot of M&A on the agenda and sometime, yeah, as always, it did not materialize, so that is unfortunate. Our M&A director and his team are very busy still, and hopefully, yeah, the 2023, we can show some more progress there. We also want to grow outside of the five countries we're in, both on compound feed in other countries and growth with other value pockets. Yeah, nice buzzword to it. You should think about other alternative products, for example, or our Pavo business, our horse feed business, or Reudink, the organic feed business. All the value pockets where we want to do M&A. As one final reminder, please press star one if you would like to ask a question. We have no further questions in the queue. I'll now turn the call back over to your host for some closing remarks. Thank you, Jess. Thanks all of you that you joined again today. It was great to hear your voices on the line again. Well, this was it for 2022. We hope to be seeing you very soon and speak to you again very soon. Let's stay in contact. Thank you so much. Have a great day. Bye. Thank you. Bye-bye. Thank you.