Clariant AG

Ladies and gentlemen, welcome to the Clarion First Quarter Figures 2025 Conference Call and Live Webcast. I am Maria, the course call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star 1 on your telephone. For operator assistance, please press star and 0. The conference must not be recorded for publication or broadcasting. At this time, it's my pleasure to hand over to Andreas Schwarzwasser, Head of Investor Relations. Please go ahead, sir.

Thank you, Sandra. Ladies and gentlemen, good afternoon. Sorry, Maria. I apologize. We are so used to Sandra. Thanks, Maria. Ladies and gentlemen, good afternoon. My name is Andreas Schwarzwasser. It's my pleasure to welcome you to this call. Joining me today are Conrad Kaiser, Clarion CEO, and Bill Collins, Clarion CFO. Conrad will start today's call by providing a summary of the first quarter developments, followed by Bill, who will guide us through the business unit results, performance improvement programs. Conrad will then conclude with the outlook for the full year 2025. There will be a Q&A session following our presentation. At this time, all participants are in listen-only mode. I would like to remind all participants that the presentation includes forward-looking statements which are subject to risk and uncertainty. Listeners and readers are therefore encouraged to refer to the disclaimer on slide two of today's presentation. As a reminder, the conference call will be recorded. A replay and a transcript of this call will be available in the investor relations section of the Clarion website. Let me now hand over to Conrad to begin the presentation. Thank you, Andreas.

Clarion delivered a strong start to the year in the first quarter of 2025. with further improved profitability in a challenging environment. Let me start by highlighting some key achievements. We delivered sales of 1.013 billion Swiss francs. This result represents a 1% increase in local currencies and a stable performance in Swiss francs. Our EBITDA before exceptional items increased by 3% in absolute terms 290 million Swiss francs with a corresponding margin improvement of 70 basis points to 18.8%, driven by strong profitability across all business units. We are steadfastly delivering our performance improvement programs and have achieved an important milestone with the completion of our 175 million Swiss francs cost savings program. I would like to thank our teams for delivering these structural savings on time and in full. These savings have supported our margin improvement in the past years and will enhance operating leverage going forward. In November 2024, we announced a new savings program, which is set to deliver 80 million Swiss francs by 2027, with a significant contribution already expected this year. In Q1, we achieved savings of 3 million Swiss francs and booked 38 million Swiss francs of restructuring charges. As a reminder, we expect to book a total of 75 million Swiss francs restructuring charges related to this program in 2025. We are pleased with the strong operational performance of Lucas Meyer Cosmetics in Q1 2025, with sales of 25 million Swiss francs and a continued high level of profitability. Our Lukas Meyer cosmetics and personal care team was also recently recognized at the Ink Cosmetics Global International Trade Show for the beauty and personal care industry in Amsterdam. The joint team received six innovation awards for three products meeting growing customer demand for high value natural ingredients. For 2025, our guidance remains unchanged with local currency sales growth at the lower end of the 3% to 5% range and an underlying EBITDA margin improvement of 17% to 17% to 18% before exceptional items. The environment has become increasingly uncertain and our 2025 guidance reflects current conditions. assuming no further escalation in trade tensions and tariffs. I will cover this in further detail later. Today, we announced a planned transition in the CFO position, as Bill Collins has made his decision to retire after three years with Clarion. The board has appointed Oliver Ritken as Bill's successor, starting on August 1st. a comprehensive handover process will be implemented to ensure a smooth and seamless transition. I've known Bill for over 10 years and we've worked closely together, including during our careers before Clarion. I sincerely thank Bill for his invaluable contributions and ongoing support. He took responsibility for Clarion's finance organization after we faced some serious legacy issues. And since then, he has established a true performance management culture and high-performing finance organization. Together with the businesses, he expanded our approach towards shared services and significantly improved our practices around free cash flow generation and capital efficiency in the company. Thank you for everything, Bill. As of August 1st, we are pleased to welcome Oliver Ritken. to the Clarion team after having spent nearly 25 years in senior management roles at Bayer. Most recently, he served as CFO of Bayer's crop science division. Oliver brings extensive financial expertise as well as experience navigating complex business environments. We are confident that Oliver is the right person to drive continued financial excellence in the next phase of our journey. to introducing Oliver to the financial community. Now, looking at our performance in the first quarter of 2025, we delivered sales of 1.013 billion Swiss francs. In local currency, this corresponds to a 1% increase, with a negative currency impact of 1% in the reported figure. We maintain pricing discipline across our portfolio, with a year-on-year increase in care chemicals and stable pricing in catalysts and adsorbents and additives. Our organic volumes decreased by 2% overall, as growth in adsorbents and additives and care chemicals did not offset the expected decline in catalysts, where increased volumes in ethylene were more than offset by declines in other segments. The acquisition of Lucas Meyer Cosmetics had a positive scope impact of 2%. Q1 EBITDA. Turning to profitability, our Q1 EBITDA before exceptional items increased by 3% to 190 million Swiss francs, corresponding to an EBITDA margin of 18.8%. This represents a 70 basis point improvement versus the first quarter of 2024. Profitability from Lucas Meyer Cosmetics partly compensated for the exceptionally strong contribution in the prior year from the seasonal aviation business. In Catalyst, we were able to partly offset the double-digit volume decline with a favorable mix and continued margin management. In adsorbents and additives, profitability was positively impacted by operating leverage due to an improved cost base and volume growth in editors. Reported EBITDA decreased by 12% to 152 million Swiss francs, representing a reported margin of 15.0%, including the 38 million Swiss francs restructuring charges booked in the quarter. With that, I now hand over to Bill for further details on our business performance in the first quarter.