Hi, good morning. I'm Jeffrey Zekauskas. I analyze chemicals for J.P. Morgan. This morning it's my pleasure to introduce the management of Ecolab. Representing Ecolab is Chief Executive Officer Christophe Beck, who's been CEO of Ecolab for the last three years. Christophe is an interesting figure in the history of Ecolab in that he began to manage the company during the COVID period. What he did is he rethought the way the institutional business approached the market, he's rethought the pricing structures of Ecolab, and really changed the profit growth structure of the company over a shorter period of time. Accompanying Christophe is Andrew Hedberg, who's sitting in the second row, who has encyclopedic knowledge of Ecolab and is always a resource to everyone. Ecolab will do a more conventional presentation, and so Christophe, please come. Thank you. Thank you for coming to our conference. Thank you so much, Jeff, for the nice words and for having us. It's always a pleasure to share our growth story. It's true that the last few years have been interesting years for everyone, I guess. The key question was, how do we use those years that we couldn't plan for, as we all know with everything that happened, in a way that's helping us for the future to be in a better place to perform even better down the road? I feel good with where we are today, and I've rarely been as bullish as I am right now about where we're going, short-term and long-term, as a company. Now, I've been 17 years in the company, so I've seen a lot. I've been part of what we did in the past, and obviously it's how we shape the future of the company. I'll be talking naturally about the future, so I know that you're all very familiar with the cautionary statement. Don't spend too much time on that, but much more for the ones less familiar with what we do. We're really in the business of protecting what's vital. We protect people from infections. We protect natural resources, mostly water, and we're the largest water company in the world. And we protect businesses in helping them produce more products, better products, safer products, while reducing the total cost of operation, while reducing the impact on the environment. And it's in the way seeing sustainability in a way to make more money for our customers, which is counterintuitive in times where many look at sustainability as a cost. We've always seen sustainability as an opportunity to improve the cost of operations of our customers, which is at the root of our name. Ecolab comes from economics laboratory. It's not an ecological proposition. It's doing the right thing the right way, leading to better results and better performance for our customers. We're in a place where we have unmatched reach and capabilities. We have 48,000 people in 172 countries serving 40 different industries very specifically. We have groups of experts. We have no generalists. When you're working in data centers or in power generation or in car manufacturing or in pharma, those are dedicated experts in very specific divisions. When you think about how much we touch, we have over 1 million customers around the world, but we touch over a third of the world's food production, almost a quarter of the power that's generated as well around the world. And we protect almost 1.5 billion people from infection on an annual basis. So the reach and capabilities we have, no one else has around the world. And we protect the world's most trusted brands. It can be global brands. It can be national brands. We care to protect those names in a way that what they do is protecting their customers and protecting the environment as well. And we work with those companies, as you can see, so many familiar names, so for many of you here in the room, for years, for decades. And with many of those companies, we don't even have a contract. It's a relationship of trust. In good times or in less good times, we need to gather. And when we can see after 50 years which one of those great brands, well, it shows how much confidence they have in what we do and how much we invest in their own future as well for them to perform even better. I like the portfolio we have as a business. It can be in terms of end market. As you can see, it's our industrial business, which is basically our water business. As a company, we came out with what we call Nalco Water in our own organization. This is a water company part of our business. And then institutional specialty that's hotels, restaurants, convenience stores, retail stores is roughly a third. And then healthcare and life sciences, as you can see, so 10%. What we call other is mostly our pest elimination business, which is a fantastic business, by the way, which is the most profitable pest business in the world and the fastest-growing business as well. When we call it other, we mean our great business. When we think in terms of geographic markets as well, I like it quite a bit, as well as you can see. It's roughly half in North America, and then you have a quarter in Europe, and you have a quarter in Asia, and in Latin America as well. The performance of those regions is very similar in a way. Sometimes it might be different, but ultimately, the performance of the company is relatively stable because we have such a breadth of end markets from an industry perspective and from a geography perspective. What’s most important is 90% of our sales are recurring. It’s razor, razor blades. We sell very few razors, but we sell a lot of blades. You can’t keep operating as a customer without the blades. It’s not a choice. It’s a commitment for the future, which is really important, so for us, in our model. That’s driving very nice sales growth. It’s been the case for the past many years, as you can see as well. We reached the $15 billion mark in 2023, which are record sales. For us, even though it includes a spinoff that we made a few years back of our upstream energy business, it gets exactly what we wanted to do, where we wanted to go, and the margin profile as well that we were looking for. So even with these $2.5 billion of sales, we managed to reach record sales in 2023, which is a real achievement. That was our last year of our first century as a company. We started in 1923. We ended record sales, record cash flow, record team engagement, record safety. It's been a hell of a year for all of us in 2023, and it's a great way to start 2024 and our second century as a company. When you think about our margins, gross margins, in that case, operating income margins, sorry, here in that chart, improving as well year after year. Gross margins improve as well year after year. Both need to go in tandem while we improve our SG&A productivity as well at the same time. All three have improved for a very, very long time. So this is something we know quite well how to do, which is really laying down the path to get to an operating income margin of 20% that we expect to reach in the next few years, timing mostly depending on external factors. Internally, I feel very confident that we will get there in the next few years, and that's the next stop. It's not the end of the story, and then we keep building so beyond the 20% because many of our businesses today are already beyond 20%. So this is something we know really well how to do. That's driving, obviously, very good earnings momentum, like the way it's evolved the last few quarters, especially in the inflationary time where we had to really get pricing in a way that's not price list increases, but it's a share of the benefit we provide for our customers, which is something which is much more sticky, and that always goes up, which is a very good model that we have. So 2023 has been a great earnings year with 16%, and we expect 2024 between 17%-25% earnings growth. And I feel quite glad that we will get there in 2024, which is a great base for the years to come as well beyond that, which is helping us get back to that long-term double-digit earnings trajectory. I feel really good about that. We've done all the right things during the last few years in order to transform our business, as Jeff said at the beginning as well, in a way. That's driving accelerated earnings growth for the years to come in a way that's sustainable because of our model, as I shared with you. So we have strong momentum. That's been true so far the past. This is true for today. Feel good for 2024 and feel even better for the future. Why that? But when we think about the big trends that we are focused on, well, there will be 3 billion more people in the years to come. By definition, mostly kids. This is very good news. The only challenge with it is that they will need more food, more water, more energy. And in the case of water, water we don't have. The world today is using as much water as what nature can replenish as a whole, and by 2030, we will need 56% more water than what we use today. In other words, that we don't have. So the only way to address that challenge is to reuse and recycle water, which is exactly what we do in our water business, so essential for our customers and for the world as a whole as well, we're a leader in most of what we do. We're the world's water company with close to $10 billion in sales in all water applications we have across all our businesses. So clearly, the number one in water, we're the number one in hygiene, and we're the emerging leader in life science. Life science means pharma. For us, healthcare means hospital, which is different, obviously. Life science is a future growth engine. So for us, we're investing behind it as we should. We've built those businesses one by one along the years when we think about the last 20 years, started in hygiene, added pest elimination, added water, and we add today Life Sciences, and we'll be keeping adding new businesses, starting with digital, which is a big area so far for us. And how we drive value to our customers? Well, we bring expertise to a site. We bring technology. We bring chemistry. We bring data. And we do it in person. This is our team doing that. It can be in a data center. It can be in a hospital. It can be in a car manufacturing plant, or it can be in a hotel. And those people who are experts at what they do, they understand how it operates. They understand what the best performance should look like. They bring the solutions that we can provide, and they help those units get to the best level. At the end of the day, it's to help you and deliver the best possible outcome, whatever they produce, at the lower total cost because they reduce the total cost of operation. That's been the model for 100 years, and we keep perfecting it day in and day out. We have a clear metric for that as well that we call eROI. It's exponential return on investment. It's three components that we translate in dollar terms. It's how do we help you produce better outcomes, better burgers, better cars, more uptime in a data center, less hospital-acquired infection in a hospital. We translate that into dollar terms. The second is operational efficiency. That's capacity. That's labor force, automation, you name it. And the third one is environmental impact. How much water, how much energy, how much waste can we help you optimize ultimately? All three translates in dollar terms. We commit to that improvement, and we deliver it day in and day out to get to that. Part of it translates into price, and that's how price becomes as well a growth engine for our company. In order to create more value, we need a lot of innovation. We have a great innovation force in our company, over 1,000 scientists, the vast majority being Ph.D.s in water, in hygiene, in life sciences, the big fields that we have. The pipeline is really strong and keeps growing in a very nice way as well, addressing some of the biggest challenges that we have out there. We have 1,000 people, as mentioned, so working in R&D. We have big issues to solve. It can be helping data centers to get to Net Zero. It can be helping produce semiconductors in places where there's no water. That's where most of the plants are going, fortunately or unfortunately, depending on how you want to look at it as well. We help restaurants as well operate with new systems, new software, becoming really the Microsoft Office of the restaurant in our hospitality business. Those are big challenges that our solutions try to really address. We have over 1,000 people as well in digital technology. We started in the 1990s. It was not called AI. It was not called the cloud. It was very different. But we invented what's called Connected Chemistry, which means that we can track and trace what's happening in each operation around the world. Today, we have 100,000 assets like cooling towers, wastewater tanks, process control anywhere around the world that are connected to Ecolab 3D. We can monitor 24/7 what's happening, correct the performance, or understand where we have performance gaps as well. That's helped us build one of the largest industrial clouds in the world, which we call Ecolab 3D. How do we use that? One example is industrial asset intelligence. We sell that to our customers as a subscription. It's basically based on that connection of data. Well, we can help them understand what's the performance of the best performing data center around the world. And that system helps you drive the same performance for all the other ones to get things like performance as well at the same time in real time. We call it asset intelligence. I guess we should call it artificial intelligence. We have the same acronym here, but that's a new program that we've been building for years. The term AI was not exactly as fashionable as it is now, so that's why we kept as well the same name. Ultimately, those customers can deliver the best, safest environment in a hospital, the best food in a food plant, the best uptime in a data center when they use all our solutions in all of their sites as well around the world. That's a $152 billion market that we're serving, and we have 10% of that market since we're a $15 billion company, as you can see. $55 billion of our opportunity out there is available in customers we already have a relationship with today. That's the easiest to grow and the cheapest to grow as well, as we all know. To give you a few examples, when we address a data center, what we start with is the cooling system, which is so essential since it's a computer generating a lot of energy, and you need to cool it down in order to keep operating as well as one. Well, once you have the cooling system, you can add as well some digital technology. You can add the wastewater treatment. You can add pest elimination. You can add all those different applications that help the data center operate safely and more efficiently going forward, drive penetration of a solution, and that increases margins because we go there anyway, so the cost to serve is pretty small. In a food and beverage plant, we always start with what we call the clean-in-place. It's basically you don't need to dismantle the whole production system. You just flow through chemistry that is cleaning, that is drying, that is sanitizing without dismantling anything. And that's all digitally controlled. Then you add all the water management system. Then you add all the food safety systems. You add the pest elimination. You add all the different systems around it in order to make that plant produce the best possible beer the safest way with the lowest total cost while reducing as well the impact on the environment. We translate that in dollar, and we drive that as well in terms of pricing. And last but not least, if you take a pharma plant, well, we focus on the clean room first and foremost, and then we add water technology, hygiene technology, contamination prevention technology, pest elimination, and all that. That's what we call the customer circle develop strategy in order to get more of that $152 billion market out there. But ultimately, it's what we do helps us become what some are calling the world's sustainability company because of how we help customers reach the sustainability goal in a way that is a good financial proposition for them and for us. But it's also because in our operations, we want to be the best example in the world while we do the same for our customers. And our customers are raising the bar every single day in terms of how they want to operate or have to operate if they are in places where there's no water. For instance, think about the new semiconductor plants. Well, most of them are being placed in deserts in our country as well. There's no water. Well, obviously, you need to put the bar of how much usage of water you want to have or could have much higher. That's helping, obviously, accelerate our demand for all those customers to reach their objective in a way that makes financial sense. And when you look at it in terms of numbers, we're delivering pretty well compared to what we had said for 2030. We aggregate all the impact of our customers. If I take just the example of water, we've made the commitment that by 2030 versus 2015, we'll have saved 300 billion gallons of water. This is the annual drinking need equivalent of 1 billion people, just to put it in perspective. And we are beyond our target trajectory in 2022 and in 2023, the same as well. We really try to get close to our target year in and year out. So it's delivering environmental impact while delivering operational performance for our customers that drives financial performance for our company as well, which brings me to our financial objectives as a company. We've been very clear what our target is, 5-7 organic in terms of top line and average. There will be some better years. Some years will be a bit slower. But at the end of the day, in terms of earnings growth, it's always going to be something in the range of 12-15 or more in the case of 2024, as I mentioned as well, and reaching this 20% NOI margin in the next few years and then keeping moving up from there as well. Cash flow is extremely strong. We have a great balance sheet, and we have a great cash machine. As an organization, last year has been a great example, and we had a great conversion factor as well, which was north of 100%, as mentioned to you as well, two times. In terms of leverage, it's our objective. When we make big acquisitions, it goes a little bit higher. We experienced that the last few years. That was the case when we invested in water as well. We always get back to 2 in a year organic way, and we always use that model so going forward. And having a strong balance sheet is an objective we have. It's an objective I have, and I will say to that, "That being said, our capital allocation priority is going to change." It's first dividend, second investing in the business, third cash buyback that we've done for many years. When we look at the last 10 years, we've returned $10 billion in cash to our shareholders being through dividends or in buyback, as you can see. So very consistent year in and year out, every single year done in a very good way. So when I look back, like where we are, like where we're coming from, I like even more where we're going. It's a lot of execution, obviously, that we love doing. We're an execution-focused company, but I like the fact that we're leading in two big fields, in water, in hygiene, with the emerging leader in life science, which will be a growth market. So in the years to come as well, at the very high margin, we have a model that's driving growth. We have margins that are improving because we share the improvements that we are generating for our customers as well. We have a long-term story of good financial performance done the right way for our teams, for our customers, for the environment, and obviously, so for our shareholders. So in a great place today, in a difficult world as we all know, unpredictable as well, but feel really good with where we are and where we're going. So with that, Jeff, I maybe just close here, and we can open up for questions. Okay. You can either take them from there from the audience, or you can generate a comment. Okay. Thank you. That was very helpful. You talked about AI as a pillar of the solutions you bring. Could you give us some use cases where you're deploying AI yourselves for your own business, and then some of the more interesting or common problems you're solving for customers deploying AI? Thanks. It's a great question. And I know that AI has become fashionable, but it's for us something that we've built over the years, as I shared with you. The fact that we can connect thousands of assets around the world, that didn't happen the last six months. This is something that happened over the last many years. And the best way to think about it when we think about AI so far is really take an example of a restaurant chain with thousands of restaurants around the world. There's an easy question that comes from the CEO saying, "What's the best performing restaurant that I have in my enterprise in terms of guest satisfaction, in terms of personal performance, and in terms of environmental impact? Which one is it?" That's a difficult question to answer, first and foremost, especially in franchise operation, which is often the case with restaurants or hotel chains as well. We can answer that because we have that data. It's either we connect it to them, or we have someone visiting them and collecting as well that data. Then there's the second question saying, "Well, if I look at all the other restaurants in my enterprise, how far are they from that best performing one, and how much does it represent in terms of dollar terms as well, environmental impact, and customer satisfaction?" Well, we can answer that question because we have the data as well, and we can translate that question into an opportunity for them. And the last important part is that our teams that are visiting those thousands of restaurants out there, well, can see what they need to do on their phone. I'm coming to that restaurant downtown Bangkok, and I want to know what's the performance of this one? What's the best performing restaurant of that chain, and how can I get to that best possible performance with what we can provide? You have all that information, all that intelligence at your fingertip on your phone that you can provide to the customer and then prove the value that you've created and merchandise it at the head office afterward. That's the way we think about human intelligence that we used to have in every people's minds around the world serving our customers. Today, it's in the cloud, and we can spread it around the world. That's the core way of how we look at AI and how we plan to merchandise it and to monetize it as well, ultimately. In the past, it was for free. It's becoming every single day a little bit less for free. Could you elaborate a little bit on what kind of data do you get that the customers of the chain restaurant, for example, they do not have, and you can help them get better in understanding their own business? And why do you have that data? Or is it among the customers who's less advanced in technology versus you so that you enable them to do better? It's a great question, and it's a combination of both. It's data they have. It's data we have. And ultimately, it's their data because it's their operations, but that we collect centrally. We do audits for the hospitality business, retail stores. It's the biggest brand in this country. We do audits for those stores all the time: brand audit, food safety audit, environmental audit, and operational performance audit as well. When we do those audits, we collect a lot of data, obviously, because we're doing the audit ourselves. We have a lot of our systems that are connected to the cloud as well where you get a direct feed of information, so through Ecolab 3D. And once we get that information, well, we can process that information and try to understand what's the gap versus the best in class as well out there. And that's our cloud that's helping us do that. So it's a combination of our people collecting data. It's data coming directly, so through our connected systems, and it's data that's provided as well by the customers. And in some cases, if you can think separately, it's conventional data as well, weather data, for instance, which has a big influence in terms of infection risk as well when we talk about water, steam, air that we can add to it as well and provide in a packaged form, ultimately, so to the customer. Thanks, Christophe. So Ecolab 3D is really exciting. I was wondering if you could share some numbers around it, as in when you guys started offering it to your customers, how many customers, where is that revenue accounted? Anything you could share would be very helpful. Thanks. Yeah. So the numbers we shared, and honestly, we will be sharing over time always more because it's relevant for us. It's relevant for you, obviously. What we've said is that we have 100,000 assets that are connected today: cooling towers, boilers, wastewater plants, production plants, and you name it. So that's a number that we have out there. What we've said as well is that in our industrial world, 20%+ of our sites are connected today, whereas in institutional, where we have way more sites because of our restaurants and hotels, convenience stores, they're much smaller, but you have more, it's closer to 5% penetration we have there, which I see that as a huge upside potential because it's enough to have the critical mass and all the technology to make it work. At the same time, it's showing the upside potential that we have, both in institutional and in industrial businesses that we have that we can not only deploy but that we can monetize as well in the future at very high margin because the digital technology being subscriptions, being data, being consulting, ultimately, do not have much raw materials, as we know as well. We are working on sharing more openly in the years to come how much sales we have there, how much margin we have there. We're not ready for that, but it's relevant, and it's going to become really significant in the near future. In a company that does so much with cross-selling, can you talk about unraveling hospitals to sort out the high-return business, the low-return business so that you can concentrate on the high return? It's a great question because healthcare has been. It's a small business for us. It's less than 5% of our sales, and we've been driven by the mission of reducing hospital-acquired infections. It's not worked out as quickly as we were hoping or as effectively as we were hoping as well at the same time. The incentive system for hospitals to get on board for that is not exactly aligned with the outcome of the patient, unfortunately. That's one part of the problem. But what we've understood for us serving hospitals, the place where we make most of the money is when we have a razor-razor blade system, and it's mostly in endoscope reprocessing and in instrument reprocessing. In other words, it's the dish machines of the hospital. It's obviously more high-tech than a dish machine in a restaurant, but where you have a cleaning system for endoscopes and for instruments and at the same place in the hospital, but that's kind of the razor, and then you have all the blades, which is ultimately sort of chemistry that you need in order to clean and sanitize instruments and endoscope. That's a business that's extremely profitable for us. It's a business we know exactly how to run because we've learned in hospitality how to make it work, and I think that's going to be the future of healthcare. Factors to hear more about the pest control business? What's the strategy targets there? I love it. You can probably compare it with Rollins maybe. Because it's pest elimination, which is very different than controlling. Making sure that few pests are controlled in your house is not exactly helpful. Eliminating them from your house is really helpful. By the way, we don't serve residential. It's purely commercial. It's business to business. We do $1 billion in that business today. It's the fastest pest business in the world. It's the most profitable business in pest elimination in the world as well, so compared to a few names that you mentioned before as well. As you will see, in the first quarter, we will start reporting pest elimination as one segment instead of having it in other as we used to have as well in the past, that you can see how the business is truly performing, which is a terrific story and keeps getting better. Yeah. Could you just expand on why 20%? I mean, it's a round number, but is there any reason why? And And you're showing good margin improvement now, but margins seem to have been stable in the past. So why 20%? It's a great question. 20 is the next train station. Whether the trains are stopping at the 20% station, it's to have first, we have many businesses that are north of 20% to begin with, pest elimination being the obvious one that we just talked about as well. Life science, way higher than 20% as well. So it's to have a clear rallying cry within the company that everyone's a need to get beyond 20%. It's to have a clear direction for you investors as well to understand, "So where do we want to go?" But this is just the next step. Once we get 20% in the next few years, it's to get to 25%, and we're not going to stop at 25% because we have businesses that are north of 25% today as well. So we will always go up. It's for you to see, "So what's the direction of travel? What's the timing we're thinking about it? How do the pieces come together?" But you're right. It's a round number, which will happen one year, and that will be it because we will keep moving up, so from there, the year after. You mentioned recurring revenue before. Can you just elaborate on that? And then do you, in the long term, say which vertical have more potential to bring up the recurring revenue, and then which vertical do you feel you can manage better or maybe on a shorter cycle business? If you can elaborate on that. We don't have short-cycle businesses. We're not interested in those businesses, so we never enter a short-cycle business. And if there's one coming in through an acquisition, for instance, we take it out. We're not interested in short-cycle businesses. All our businesses have 90%+ recurring revenues. It's very different types of revenues. It can be capsules to produce glass cleaners in a restaurant, or it can be a tanker to manage water in a nuclear power plant. It's obviously not the same technology, but you always have a dispensing solution equipment that is using our chemistry, using our data in order to translate it into revenue, ultimately. So recurring revenue for us is 90%+ of our sales in every single business in every country that we have around the world, and that's never going to change. I think so we're coming at the end. Thank you so much for joining us. If there's any other questions, please reach out to me or to Andy Hedberg as well here. I really like where we are and even more where we're going, so thank you, Jeff. Thank you. Thank you for your time.