Stellantis N.V.

Hello and welcome to Stellantis' full year 2023 results. I'll now hand the call over to our host, Ed Dittmeier, Head of Investor Relations, to begin today's conference.

Thank you. Hello, everyone. Thanks for joining us today as we review Stellantis' full year 2023 results. Earlier today, the presentation material for this call, as well as the related press release, were posted under the Investors section of the Stellantis Group website. Today, our call is hosted by Carlos Tavares, the company's chief executive officer, and Natalie Knight, the company's chief financial officer. After both Mr. Tavares and Ms. Knight present, they will be available to answer questions. Before we begin, I want to point out that any forward-looking statements we might make during today's call are subject to the risks and uncertainties mentioned in the Safe Harbor Statement included on page 2 of today's presentation. As customary, the call will be governed by Dutch language. Now, I would like to hand over the call to Carlos Tavares, CEO of Stellantis.

Thank you, Ed. And good morning and good afternoon to all of you. Nathalie and myself, we are delighted to host this session, the Stellantis 2023 Financial Results Announcement Session. We know that you are very busy people and therefore we value your time and we thank you warmly for your interest in Stellantis. Let's get started. First of all, 2023 was one more record year for our company. A record in net revenues, plus 6%, a record in net profit, plus 11%, and a record in free cash flow. Plus 19 percent. So a record year in, of course, a very agitated year that demonstrated once again that we are a highly resilient company. We are an all weather company, as I'm sure you already know. We are so happy to be here with you today to comment. what has been done, and to answer your questions. It is fair to say that not only we were able to go through a very agitated year with record results, but we have demonstrated to you that we are ready for the future. We are executing our transformation. We are doing what we have told you, what we have explained in the Therefore 2030 plan, and we are ready. We are ready for 2024, and we are ready for the next steps of our transformation, and we are ready with a very, very flexible capability. And this is, I'm sure, something that we will discuss, all of us, today. So from here, I would like to move to the second slide, which is about a real game changer. And I'm focusing on this specific game changer, which is the car you have on the screen, the brand new eC3 from Citroën. This is a B hatchback. Pure BEV that is now going to be sold in the European market at 23,300 euros for the mid-trim. The entry trim will be sold from 19,990 euros. Why is this important? Well, this is important because at this price, this product is profitable for our company. At this price, this product is going to represent an affordable offering to our middle-class customers, which is exactly the most difficult thing that we have to do right now in the Western world, is to make it simple, be these at the price of ICEs for our middle-class customers. This is where we are. We are going to be able to offer for this 23,300 euro EC3 mid-trim, 320 kilometers of WLTP range, which is a very competitive range for this kind of product. And later on, we are going to bring an even more price competitive product at 19,990 euros for 200 kilometers of range. This is demonstrating that we are getting prepared to deliver the most difficult part of our mission. As you know, our mission is to deliver clean, safe and affordable products to protect the freedom of mobility. With this BEV product at a very competitive price with very, very good features, you see that we are now ready for the race. And this is what I wanted to convey to you today. If we step back a little bit and we look at what happened this year, First of all, we have to recognize that we are a growing company. Our strategy is not about shrinking. Our strategy is about growing profitably. You can see that we could grow our net revenues by 6%. And we have a very efficient overall AOI amount of 24.3 billion with a 12.8% margin. Our free cash flow is a record free cash flow, industrial free cash flow of 12.9%. As you remember, last year we were at 10.8. It is up 19%, which once again demonstrates that Stellantis is a very efficient organization to generate cash. And this is something that you have been seeing over the first three years of life of Stellantis, as our cash generation has increased every year compared to the previous one. As a consequence of this, We are today confirming a very outstanding capital return to all of you, the 2023 capital return of 6.6 billion euros, which is a 16% number compared to the January 1st, 2023 market capitalization. This very significant return is something that we believe we owe to you. And you will see that for 2024, we have even better news for all of you. If we look at our therefore commitments, one of them is very strong. It's about growing our BEV sales, our zero emission vehicle sales and our LEV sales. On this front, at the moment where we are making profit with those sales, We can show to you that the BV cells are up 21%. DLEV cells are up 27%. We are number three in Europe. We are number two in DLEV cells in the U.S. And by the way, we are number one in PHEV cells in the U.S. If we continue, we can comment that we are... the undisputed leader of light commercial vehicles in Europe and Latin America, with respectively 30.4% share and 28.6% share. But more than that, we are also the leaders of electrified mobility in LCVs, with in Europe no less than 38.8% share. So we are clearly the leaders of clean mobility for the light commercial vehicles. Last but not least, in terms of their forward commitments, we are ahead of plan. in what relates to the third engine, what we call the overseas club. We want to bring a third engine to our North American engine and our European engine. And it is fair to say that the third engine could grow at twice the pace of the whole company in terms of net revenue, plus 13% compared to plus 6%. And you'll see later on that the profitability is stellar and that right now the third engine is getting very, very close to the profits that we have in Europe, which is excellent news. And that just means that our strategy to go a third engine is not only being executed, but ahead of plan. For the third part of this slide, we want also to confirm to you that we are increasing our BOV offensive. We already have 30 models on sale in 2023, and we are going to move from 30 to 48. On those 18 additional models, eight will be dedicated for the US market, which just confirms what we told you last year. telling you that in 2024, we will be very strong on ramping up this BV offensive. We keep our commitment, the commitment that has been made to you in March 2022, when we presented to you the therefore nine-year strategic plan. We are totally aligned with our commitment, double the net revenue by 2030 and keeping our AOI margin above double-digit. Last but not least, coming back to capital return, what we are going to propose to you is a 3 billion euro share buyback for next year, which means doubling the share buyback of 23 and a dividend that is also going to increase by 16%. So a very significant increase of capital return to our shareholders, which is absolutely normal given this is your company at the end of the day. Moving from here, let's have a look at the regions and starting with North America. North America has delivered a very robust 15.4% AOI margin. Despite everything you know about the events in September and October 2023, we are able to protect 15.4%, which is great. 100 basis points less than last year, which I believe is a very robust result given what has happened. And I want to take this opportunity to convey to our North American teams my warm thanks and the very sincere appreciation for everything that has been done. Of course, we did not do everything well as we have lost some market share. We believe that we have understood what did not went well in terms of operations and we believe that we are now on track to fix that. And all the things we did not do well in 23 are opportunities to do much better in 24. And we believe that we have the tools for that. From here, we also have to recognize that we have been protecting the value of what we are doing in our company, which is translated by the fact that we have the best U.S. average transaction price of the industry, at least compared with our direct competitors. We are number one PHEV sales. Actually, it's more than being number one. We just doubled. are year-over-year sales to 136,000 units in 2023. And we are number two in LEV sales. What this tells us is that for the transient period that we may have ahead, we are perfectly positioned to perform with our plug-in hybrid technology, the 4xE technology that has proven to be a great success and still is in the U.S. market. Last but not least, the commercial fleet sales. We are up 20%. We are bringing more ProMasters. We are bringing ProMaster EV to the market, which is a great offering to many of our corporate fleet customers. And this is now live. We are able to ramp up. We are ready for this competition and we are gaining significant volume in 2023. We expect to gain more volume in 2024. And last but not least, in terms of pickup trucks, which is, as you know, a big profit provider for our operation in North America, we have presented to you and to the world the large spectrum of our technologies. We are going to bring ICE. We are going to bring pure BEV with a fantastic range of 500 miles. We are going to bring range extenders for different kinds of vehicles. customer segments across the market. We believe we have the largest, the most efficient market coverage in pickup trucks in the US. So great results, robust results in North America and opportunities to do even better, mostly in US and Canada. If we move from here and have a look at Europe, The first great thing about Europe is that Europe was able to sustain a stable 9.8% AOI margin and grew the profit to 6.5 billion. This is good because the competition was much more sharp than it was in the previous years and because we had a significant increase on our LEV cells and BEV cells. So the mix of electrified cells increased significantly. And at the same time, we could maintain the AY margin. And at the same time, we could grow the amount of profits. So a great performance there, even though a little bit like in the US, we suffered on the share. We lost 140 basis points. We believe that this is coming back quite strongly and we'll have the opportunity to discuss because we see that our order book is now being filled in a very efficient manner. One thing that we see in Europe, which is quite stunning... And quite demonstrative of the power of our products, the power of the appeal of our products and the power of our technology is that as soon as we communicate a little bit more on marketing communications, we have a very good response from the market. And that's what we have been doing over the last few weeks. And we see that the response from the market is very strong. And we see our order book getting filled week after week. So we believe that we can do a better job in Europe in 2024. From here, we have to recognize that our 14.2% BEV market share is below the total market share. Of course, this has also to do with the fact that we want to protect the profitability while we grow the sales, as we have seen. So there was a significant growth on sales. At the same time, we are protecting the per unit margins to make sure that we protect our earnings vis-à-vis the BEV sales mix as we are reducing the cost every single day, as we will see later on. So number three in Europe in BEV sales with a significant growth. a number that was increased by 38 kilounits year over year. Online sales is a big success, a very big success. This new sales channel is something that we believe is very promising for the future. It is a much lower cost of distribution. It is meeting the expectations of the customers who have the need for a hassle-free customer journey. And we are offering exactly that, a hassle-free customer journey with all the services online. The result is here, up 55%, a very strong number. Overall in the world, we are at 360,000 sales for the whole world. We are at 188,000 sales in Europe, and specifically in Europe, a very good response to the very nice customer journey, hassle-free, that we are offering on this specific channel. In terms of LCV, our leadership is undisputed, 30.4% market share, with, as I already mentioned, a 38.8% market share for the BEV Pro1 vans in Europe, which is a very strong position. As you know, the LCVs represent one-third of the total net revenues of the company. Last but not least, we are executing on our plans to bring gigafactories to our markets and be able to source battery cells from the regions to the regions. It is quite clear that we have with ACC not only taken the leadership, in terms of shareholding, but also that we are executing on plan. And this is very important. We are on track, on plan for the first plant in Douvrain in France that is now manufacturing the primary production on schedule. And by the end of this year, we'll start delivering to our vehicle plants the final battery cells that we need for our European sourcing. It is a very big achievement and I would like to congratulate the ACC top executive team and namely its CEO, Yann Vincent. From here, let's move to the other regions. And here you have really a very nice picture about what our leaders are doing. Middle East and Africa is quite outstanding. We could double The overall amount of profit, the AOI amount has doubled to reach 2.5 billion. The AOI margin of Middle Eastern Africa is by far the most profitable business that we have across the regions at 23.7%. The number two being North America at 15.4%. And then you have South America at an AOI margin of 14.8. It's the number three with an AOI that was up 16 percent. So a leading region, both in automotive group sales, in brand sales with Fiat and here also 2.4 billion of additional of profit. And last but not least, China and India, Asia-Pacific. with a very respectable margin of 14.2%, stable in net revenues. And we have, of course, still some good things to do in terms of planning, to leverage the leap motor strategic partnership, which is a big opportunity, as we are controlling all the exports outside of China and consolidating the profits that will come from the exports outside of China for the leap motor sales. We are also in a position to see that the C3 sales in the Asia-Pacific are growing by 30%. which means that our smart car platform strategy is now bringing some results in terms of growth for our company. This is what we can say here, but the most important thing is that Middle Eastern Africa, South America, India, Asia Pacific represent the third engine of our company. And we see that in 2023, this third engine was very close to the profit that we get out of Europe. So I expect that very soon we will have this third engine active. which means three big engines of profitability for our company, with Europe and third engine at a similar amount at the end of the day, which gives our company even more robustness and even more capability to be an all-weather company, given the risk that we could face of regional crisis. If we move from here, I would like to comment also our very creative businesses that are expanding across the world. I will start with financial services. First to say that our U.S. financial services are now live. They are very active. They are growing. We are at $7 billion of receivables. We expect that this is going to exceed the 10 billion target of 2024. And this already represents a tripling of what we did in 2022. So very fast growth, very efficient growth. And this is going to give us a very important tool on the comeback on the share that we expect in North America and the US. It's an important tool for sales and marketing, as you know. Now we have it. Now it's growing. And now it's competitive to support our sales and marketing teams. We have also completely concluded the restructuring of our European financial services. They are now much more simple. one financial service per country. We have been improving our receivables and now we are at 56 billion euros of receivables. It is 21% more than last year. So growing and now totally live and totally efficient. And we have also reinforced our presence in Brazil. On the circular economy business, this is really a fantastic opportunity for us. As you know, we have created the first circular economy hub in Italy. We will soon announce another one. And we are so excited about this for a very simple reason. It's a growing business. We grew by 18%, and it's extremely accretive to our overall AOI margin of the company. Very accretive, pulling us up, and we see that there is a lot of growth that we have ahead of us. I would mention the remanufacturing with a 14% sales increase with 38 product lines that we remanufacture. The reuse, where we increased by 63% our sales in 160 countries. We have now set up in the repair 24 battery repair centers across mostly Europe. And the recycle, where we increased by 84% the number of parts that we are recovering for recycling. This is a highly creative business. This is growing, and this is going to be growing even more when we will announce additional circular economy hub on top of the one we already have in Mirafiori in Italy. So on this page, great businesses that are growing represent big opportunity for the future. Let me move from here and talk a little bit about product. Product is our passion. Technology is the way to express appeal. It is quite clear on this slide that not only you have this fantastic example of the Alfa Romeo Stradale 33, which has been a fantastic project that comes with a great brand equity to add to the great brand equity of Alfa Romeo, but more than that, it supports the fact that our sales... across the world in Alfa Romeo could grow by 33%. 33% of global sales growth for Alfa Romeo. Great job done by the team. And it has been, of course, put in a high level of visibility by the Stradale 33 project, which is completely sold even before we deliver the first car. So a great brand equity reinforcement. On the pickup trucks, we have everything we need. We have all the technologies. We are now going to start ramping up with the pure BEVs, with the range extenders, with the ICEs, with the model year 25 RAM 1500. We see that there is a very significant potential there for our comeback on profit and share. And we see that we are going to be able to offer up to 500 miles of range on the pure BEV and also more than 700 miles of range for the range extender. So 500 miles of range for the BEV, 700 miles of range for the range extender. This is outstanding from a technology mastering perspective. This means that we are going to completely wash out any range anxiety syndrome. This is going to disappear, and that should bring a solution to all the pickup truck customers, not only on the coastal areas, most probably with BEV, but also in the deep countryside areas, possibly with more range extenders. If you look at the lower part of this slide, you have the first application of our Stellar Medium platform. with the Peugeot E3008, 700 kilometers of WLTP range. This is a product that is going to use the battery cells from ACC. So it's going to be fully supported by our local sourcing of battery cells in the European market, a huge pillar for the business of Peugeot, now ramping up in our social plant. A very strong product, as you may imagine. In terms of Opel brand, the remarkable performance of Opel is not only the fact that the BEV cells could grow by 27%, but because Opel is the first brand of the 14-brand portfolio of Stellantis that has a total market share on BEV that is on par with the total market share all in of the brand. So this is the first brand of our brand portfolio that has been able to deliver in the BEV market the same market share as the total market share in the market. It is important to see that the pure BEV sales could grow by 27%. whereas the total sales could grow by 15%, which is an excellent result. Knowing where we are coming from back in 2017, it is good to see that Opel is in great shape, great growth, great profit, great technology. From here, I would like to hand over to Nathalie. She is going to give you all the details on our financial results. Nathalie, the floor is yours.

Thanks very much, Carlos. Let me start with a focus on four key metrics that highlight the major developments of our financial performance over the last 12 months. The first one is consolidated shipments, which is where we're up 7% in 2023 to 6.2 million vehicles. Net revenues grew 6% to reach 190 billion euro. AOI, it's another key metric for us in the group, and here we delivered a strong 12.8%. And last but definitely not least, Delantis delivered an industry-leading industrial free cash flow of 12.9 billion euros, up that 19% Carlos spoke about versus 2022. I'll now discuss each of these KPIs in a little more detail. On the top line, for the group, we increased by 6% in 2023. Volume and mix were the biggest movers, supported by higher shipments, especially in enlarged Europe and the Middle East and Africa. This, along with our full-year pricing improvements of 4%, allowed us to offset significant FX headwinds due to the strengthening euro versus the Turkish lira, the U.S. dollar, the Argentine peso, which reduced revenue by 6.5 billion euro. With respect to H2, and you can see that along the bottom of the chart, you see that revenues were essentially unchanged due to higher FX impacts and some pricing moderation. Now let's shift our attention to AOI, which came in at 24.3 billion euro. The main positive driver here is the strong pricing I just mentioned, bringing an additional 6.7 billion euro margin benefit. Our total net cash synergies were 8.4 billion euro in 2023, and out of those, more than 5 billion had positively impacted our AOI, showing that once again, the benefits of the merger are really coming through. But there were headwinds, too. FX had the biggest negative impact, as you can see, at 3.8 billion euro. Industrial costs were also negative, as we experienced higher logistics and warranty costs, offsetting sizable manufacturing and purchasing improvements, as well as positive benefits from raw materials. with respect to SG&A expenses. This is a spot where it was nearly unchanged versus the full year prior year and lower on a year over year basis if you look at the second half. Cost discipline is a rock hard discipline at Stellantis. As a result, we have reduced our SG&A as a percent of sales from 6.1% in 2021 to 5% today. I think that's really unique in the industry. Looking at H2 AOI development, as you see below, the net pricing gains were smaller, FX headwinds increased, and the industrial cost became margin accretive thanks to lower raw material cost. Now let's move on to inventories. Inventories at year-end rose by 72,000 units sequentially, or 5%, compared to the end of the third quarter. This represents the net impact of a 15% reduction in company inventories due to improved delivery logistics in Europe, but at the same time, higher dealer inventories due in large part to changes in the EV production schedules and regulation. On a year-over-year basis, where we were higher than we had been at the end of 2022, inventories still remain below the levels of our pre-merger predecessor companies. I think that's important to note. Going forward, despite our continued focus on pricing discipline, we don't expect further inventory increases of any materiality in 2024. So let's focus now on industrial free cash flow, which reached that 12.9 billion euro. It's up 19% versus 2022 and 5 billion euro versus 2021. The strong development was driven by higher AOI, lower negative impact of DNA, and a positive development in financial charges and taxes. And this allowed us to accelerate our investments, which grew 2 billion euro higher year over year, driven by battery JVs as well as our U.S. FinCo. We're also able to further reduce our factoring activities as part of our working capital normalization plan. This next chart finishes out our discussion on the major items of our 2023 IFRS income statement, as well as our financial position and liquidity. Diluted EPS grew 12% year over year, driven by a 10% gain in our operating income due to the non-repetition of unusual charges in 2022, mainly related to the Takata recall and CAFE penalty adjustments. Our first ever net financial income also supported this development. Offsetting this modestly were higher tax expenses with a 17% tax rate versus 14 and 22 due to lower recognition of deferred tax assets. I'd also like to call out to your attention. that going forward in 2024, we are introducing a new financial metric, adjusted EPS, to our reporting. This highlight metric should be useful as a complement to our AOI, making clear the significant impact that our share buybacks drive for investors. In the appendix of today's presentation, if you look back on chart 48, We show how adjusted EPS would have been calculated in 22 and 23, and we'd really appreciate it if our analysts start to incorporate this in their published estimates going forward. Moving on to the liquidity front, our net financial position grew nearly 4 billion euro to 29 billion euro at the end of 23. As free cash flows more than offset our increasing capital returns. And our industrial available liquidity was stable year over year at 61 billion. Along with the industrial free cash flow, these KPIs prove that we are in a position to both ensure strong resiliency as well as continue to deliver substantial capital returns. Speaking of capital returns, in 2023, Stellantis delivered a record €6.6 billion to shareholders, including €4.2 billion in dividends, €1.5 billion in our first ever open market share buyback, and a €900 million share. repurchase from Dong Feng Group, who as a result now only retain 1.5% of Stellantis' outstanding shares. For 2024, the company intends to propose a 1 euro and 55 cent dividend per share at our upcoming AGM. This is a 16% increase and represents 25% of prior year income, consistent with our dividend payout guidelines. Today, we are also announcing plans to pursue a new €3 billion open market share buyback program, doubling the size of last year's program. We will start executing this repurchase very soon, based on our current shareholder authorization, and intend to remain active in the market throughout the year. In total, we intend to deliver returns of €7.7 billion, representing a 26% increase year-over-year, equivalent to an 11% yield on the Stellantis market cap at the beginning of 2024. We also retain the option to repurchase any and all of the remaining shares held by the Dongfeng Group, subject, of course, to their decision and timing. I'd like to wind up my section today with some comments on the financial outlook and our guidance for 2024. As we begin 24, let me emphasize that we see a largely supportive revenue backdrop for the industry with moderating interest rates as the year progresses, which should support improving affordability and therefore higher consumer demand. We also believe supply conditions are nearing pre-COVID and semiconductor crisis levels and and that our own delivery logistics have improved significantly. And now, most importantly, we have a strong product portfolio lined up. You've heard all about it from Carlos, including not only these expanded EV lineup that addresses what was previously untapped segments, but also with updates to some of our most important ICE products. So, moving next to AOI, we are reiterating our commitment to a double-digit margin in 2024. While we are always working to maintain or improve our performance, we know that 2024 results will be subject to the impacts of significant headwinds, some of which I'll detail in just a moment. But let me start with the positives. Lower raw material costs are expected to be positive, an amount of about a billion euro to our AOI over the course of 2024. Our logistic costs should also continue to improve. In the second half, we'll lap the 1.1 billion euro of strike impacts and new contract expenses of 2023. While those are all important 2024 positives for Stellantis, there are also several AOI headwinds which we'll be working hard to mitigate. Competitive market conditions leave less room for price increases. A higher mix of LEVs, while we're proud to say that EVs and PHE vehicles deliver solid profitability for us, they're still not yet at the levels of our ICE vehicles. The last area that I'd like to mention and talk about here is our continued expectations for strong industrial free cash flow. Here we will remain very disciplined on CapEx and R&D spend. We also should benefit from the moderating working capital headwinds because of the progress we've made already improving the quality of the balance sheet and moving closer to the neutral working capital objective we set. So summing up these three topics, first, we see the macroeconomic backdrop as one that we can and intend to grow revenues against, especially with our exciting new product wave. Second, we reiterated our double-digit margin minimum commitment and understand the challenges we have to mitigate to maintain this top-ranked profitability in the context of our peers. And third, we expect to continue generating the strong and continuous positive free cash flow that will enable us to deliver very significant capital returns. So lastly, I'd like to briefly remind you about some coming investor events in the first half of 2024. Most importantly is our Investor Day, which is planned for June 13th in Auburn Hills, where we intend to share in more detail about our products and services that are evolving, about what goes on in evolving and consistently delivering high levels as we work to transform ourselves and the industry going forward. That concludes my financial section, so I'll now turn over the podium back to Carlos for some concluding remarks.

Thank you, Natalie. Thank you for this super clear presentation. I just would like to share with our investors a couple of more things. First of all, in 2024, we are going to enjoy a very strong LCV-based business, our Pro1 business, with the six brands you see on this slide. It's quite remarkable to see that we are number one in Europe. with a 30.4% market share. We are number one in BEV in Europe, with a 38.8% market share. We are number one in South America, with 28.6% market share. We are number two in Middle East and Africa, at 21.8% market share and growing, seven points over the year. And we are number three in NNA, in North America with 18.2% market share. There is a significant potential here. And what I would like to share with you is the fact that if you break down H1 of 23 and H2 of 23, you will see that in H2 of 23, we are in an uptrend in terms of gaining highly profitable market share. And we expect that to continue as we have significant new products coming in. I already commented the RAM offensive with the 2025 RAM model year, 1500. And of course, the ProMaster BEV, which is now live and being manufactured out of our plants. We also have a full van lineup renewal with 13 NAPLates worldwide, significant MCAs coming out of our plants. And we are now reinforcing our sourcing of one-ton pickup trucks in the third engine. That is going to be representing an additional potential for growth. And of course, a very strong competitive sourcing that we will have over there. Last but not least, we are possibly the only automotive company that is proposing in our LCV offering BVs, fuel cells and range extenders. So in terms of technology, we have the best coverage of the market moving forward. So a lot of potential there. Not to forget that from 2024, 1% of our new vans and pickup trucks will be connected and activated at the moment of delivery. So very strong opportunity there, and hopefully we'll execute properly. If we move to our BEV offerings... It is going to be a very strong year. We are going to move from 30 models by the end of 23, to 48 models by the end of 24, i.e. a 60% increase, with some very strong iconic models in iconic brands like the Peugeot e3008, the Ram 1500 model year 25, as it was already mentioned, the Citroën EC3, but also the Jeep Recon, And also the Wagoneer S, not to forget the brand new Dodge Charger with more power, more torque, more burnouts and more donuts. This is exactly what we are going to bring. So very, very powerful new products. I have driven all of these cars. I can tell you that this is an outstanding product, outstanding technology, outstanding dynamic performance. And I'm very excited about what is coming here and very confident that the customers will ultimately agree with us on the journey and the experience that they can enjoy with this product. So the product pipeline of Stellantis is now in full motion. just three years after we created this company. If we look at technology and platforms, I would like to share with you a couple of things. We already launched and we made a specific event to present them to you, the Stellar Medium with 700 kilometers of WLTP range and the Stellar Lounge with 500 miles of WLTP range. Those two platforms, stellar platforms, out of the four platforms we intend to launch, are demonstrating to you the execution capability of our company. three years only after we created Stellantis. It demonstrates that we have the engineering power. It demonstrates that we have the agility. It demonstrates that we work very, very hard. In a nutshell, it demonstrates that we are ready for the fight. If we look at Stellar Large only for D and E segments, you can see that we can make front-wheel drive cars, rear-wheel drive cars, all-wheel drive cars, sedans, crossovers, and SUVs. So the amount of brains that we have put in these platforms is absolutely outstanding, and I would like to congratulate our engineering teams. I think they are really giving us the best weapons we need to have to be competitive in the marketplace. Of course, we will continue to reduce costs, because we understand that as long as we cannot offer BEVs at the price of ICEs, the job is not done, and we have a very strong plan to achieve that. But it is also showing that we are delivering on the commitments of the DARE Forward Plan as it relates to the ramp-up of BEV products, not to say that they are multi-energy products, and this is a great decision that we have made three years ago. And given the uncertainties of the market, given the uncertainties that I'm sure you are going to question us on, the fact that we have multi-energy platforms is certainly a very strong competitive edge for Stellantis. I would like also to mention that on the 18 BVs, that we are going to bring in 2024. Eight of them are for the North American markets. To conclude this presentation, just would like to tell you that, first of all, I am absolutely grateful, sincerely grateful to our employees, to our union partners, to our board for everything they have done to support our strategic plan execution. We are on plan. We are on track. We are delivering record results. Nothing here has been easy. Absolutely nothing. But we have proven to you and to ourselves that we can stick together, that there is cohesiveness in this very diverse company with more than 170 different citizenships. We are sticking together. We are moving all in the same direction at the same pace, executing the same plan. And this is visible. And in the early 2025, we'll commend to you the results we have achieved on the first leg of the plan before we move to the second leg, the second three-year leg of the plan. We are highly profitable among the most profitable companies that you can find in this business. We are for sure the most resilient with the lowest breakeven point. We are working very, very hard to bring our per unit margins of LEV cells to the same level of ICE. And we believe we are on the right track as those cells are already profitable, not as profitable as we would wish, but moving. It's moving every day, and that's good for all of us. So very happy to congratulate our employees. I would like also to express to you all, the investors, my sincere appreciation for your support. Nothing here could have been done without your support and without the stability that you are offering us. So thank you for that. Let's now move to your Q&A. I'm sure you have a lot, so I'll hand over back to Ed.

Please signal by pressing star 1 on your telephone keypad. To allow all participants the opportunity to signal for questions, please limit yourselves to one question. The first question today comes from Daniel Rusca of Bernstein Research.

Hi, gentlemen. Hi, Natalie. Good afternoon. Good morning. Carlos, market shares have declined in some parts of the business, and I was just wondering how important is it for your long-term positioning to, let's say, carefully regain some of those points? And in order of priority, I think, what's most important to you? And then is OPA's yardstick of reaching share parity between ICE and BEV, is that a benchmark for other Stellantis' brands that you would like to see them achieve as well?

Two great questions. Thank you. Well, first of all, it's very important that we protect our share if we don't increase the share. Because we don't have a shrinking strategy. We committed to you that we would double the net revenue of the company by 2030 compared to 2021. So it is very important for us to protect our share. And we want to do it in a way that is going to be respectful of the net revenues and respectful of the profitability. So to be very clear, it is important for us and we are now reacting to that. You have a first answer in the share that we delivered in January 2024 in Europe, which is much better than it was by the end of 2023. And we want to regain that share in a way which is respective of the value that we create, which means protecting the profitability. And at the same time, making sure that it is sustainable. This is what we want to do. The good thing is that in 2023, we did many things wrong. And I can tell you that many of our business reviews were not a walk in the park. which means that we are starting 2024 with a significant number of things that we can do better. We can also benefit from the fact that we have fresh products coming, not only about new models, but also about new powertrains. Like, for instance, right now, we are deploying in Europe across the different brands a fantastic mild hybrid technology that is going to support a lot of additional profitable sales at the core of the market so this is to answer your question yes it is important to regain market share because we do not have a shrinking strategy and this is visible in the commitment of doubling the net revenues by 2030 and we want to do it in a wise way which is protecting the profitability and protecting the value of our brands and the brand equity that we have for supporting the pricing power So that's my answer to your first question. Second question, the margin parity is something that we believe we need to do. And we believe we need to do it fast. because it is the best protection against the Chinese offensive. The Chinese offensive is going to be, of course, very powerful. It already is. You can see it in the European market. In the U.S., you could compare to what happened in the 70s when the Japanese carmakers came and to what happened in the 90s when the Koreans came. So we may not want to see a third time the same movie with the Chinese coming. So it's important that we put ourselves in a business model that is immune to the mix of pure BV cells, as we expect that mix to grow, even though there could be some bumps on the road. The fact that for the last 10 months we are experiencing more than 1.5 degrees of global warming is bringing a lot of education to the people and to the public opinion about the urgency to do something about the global warming. Even if passenger vehicles and LCVs are only 12% of the emissions, we need to bring our contribution to fix that. And I believe that the BEV electrified sales ramp-up is going to continue eventually with some bumps on the road. So it's important that we protect our business model. vis-à-vis that sales mix increase and that we equalize, levelize the margins between the two. Right now, we are working on that and we are progressing quite quickly. 2023, the pace of total production costs on the BEVs was much better than the pace of total production cost reduction on ICEs. And it is being helped by the fact that many people are talking about the slowdown on the BEV demand, which has had a huge impact on the raw material cost, which has come down. And that is helping us to reduce the total production cost on BEVs faster than the ICE. So it's important for us to do that, but it is important to do it fast. This is where we stand on those two questions. Let's go to the next one.

Our next question comes from Philippe Huchot of Jefferies.

Good afternoon. Thank you very much. I have a question on the EV adoption. It's a big topic right now, slowdown. It seems to me that EV adoption is not just about dropping the price. We've seen the price drops, and that hasn't really worked. And at the same time, we need healthy used car market, reasonable values to hold up, more leasing, et cetera. And I'm curious to have your thoughts, because I think Stellantis is more involved in the whole value chain and distribution than most other carmakers. So you probably have a better handle on those issues. And I'm kind of wondering what's your view and what needs to be done to make sure that there is a gradual progression of EVs, that we're not just waiting for cheap cars to come around, that is more smoothness in the process. Thank you.

Well, thank you, Philippe. This is a very, very great question. It's a $1 million question. I would like to try to answer you by saying that the EV adoption is mostly driven by the alignment of four different stars. The first star that we need to take in our hands is the clean energy star. We need clean energy. Whatever you do in terms of CO2 emission reduction, you need to start with clean energy. Assuming that we have the clean energy, the second star that we need to have is about a visible, highly dense charging network, which means a charging network that comes to your customer journey, at the moment where you don't need to look for the charging spot, which means when you go to the shopping mall, when you go to the supermarket, when you go to the restaurant, when you go to gym, in the parkings of those services, you find charging units. So we need a second star, which is about a visible and dense charging network that comes to your customer journey and your citizen journey. That's star number two. Star number three, is the product, the product itself. The product needs to be enjoyable, NVH, acceleration, range. All of this is something that needs to make the product simply appealing. And I think we are there with a stellar platform, stellar medium, stellar large, stellar medium. and very soon Stella Small, all of this are going to demonstrate to you that the product is absolutely outstanding. And I can tell you, after 42 years of automotive life, the BEV products are better products. If we solve the inconvenience of range or the inconvenience of not finding always the charging spot that we would like to find. So that's the third star. And the fourth star is affordability. And you are right to say I share your perspective to say that it's not only about affordability. But I would say that on the first three topics, the first three stars, some progress is being made on clean energy. Some progress, probably not enough, is being made on the density of the charging network. The products are here. The products are coming, at least on Stellantis. They are now here, a big offensive in the U.S. and already very, very present in Europe. And at the end of the day, we need to bring affordability. First example of affordability is the Citroën EC3. And we'll bring more and we'll keep on working on reducing the costs of the BEV technology. So when those four stars are going to align, I agree with you. Things are going to move and they will move faster and they will move eventually very, very fast. We have a big stimulation that is coming. It's the Chinese offensive. It's a big stimulation for us to go faster in aligning those four stars. And I was asked the question this morning. about if we are going to take any decision like some of our U.S. competitors in terms of slowing down what we are doing in electrification. And my answer is crystal clear. No, we keep it flat out. Because we believe that the education of the citizens and the education of the consumer about the urgency of contributing to fixing the global warming issue is going to grow from the fact that we are already seeing that we are above 1.5 degrees of global warming much sooner. than what we had predicted so the public opinion is going to push in that direction whatever happens you may have some bumps on the road some slowdowns on the road but anyway it's going to move so we keep it flat out in the execution of the therefore plan thank you philip that's a great question thank you thank you the next question comes from george gallier of goldman sachs yeah thank you for taking my question

I'm going to ask quite a direct question, if I may, as I know you are very keen competitors and experts in benchmarking. Some of your U.S. and European peers who have already reported have suggested that they will grow operating income in 2024, albeit off a lower base than yourself. I know you've described this year as turbulent. But do you think flat AOI or indeed AOI growth is feasible for yourselves this year? And maybe related to that, you do mention it as being a supportive revenue backdrop. From your capital markets day in 2022, you set a revenue target for this year of 200 billion euros. Is that still something which might be achievable based off what you can see today?

Thank you. Thank you. That's a great question. And let me give you a first high-level answer. And I will hand over to Nathalie for any more precise comments she would like to add. First of all, let's make it super simple. The average transaction price of BEVs is higher than ICEs. That's the first thing in terms of growing the top line. So let's take that as a given. Second thing is that, as I already mentioned, we have done a lot of mistakes in 2023. I'm not going to mention all of them to you because I don't want to hurt my team. And if we are doing what we are doing, it's because of their talent. And I want to keep things as smooth as they can be. But many things we did well. other things we did poorly and we have to fix it so all of those things represent potential for improvement one thing that makes me smile is that given the competitiveness of what we are creating and launching in the market we see that each time that we put a little bit more money in the media communications eventually a little bit less money on the hood the response is very good, which means the products are competitive, the products are appealing, and the technology is there. So we believe that there is a better way to go to market, and this is what we are doing right now in Europe, and it's working very well. As you know, we have set up a new leadership, top leadership team, in North America with great executives leading RAM, leading JEEP, leading the region. I believe that those three executives are going to be doing a very, very good job to bring back the profitable share that we may have lost this year. So my point is we don't have to be more aggressive than ourselves. I mean, you know who you are. You know how we act. You have been looking at us for many years now, and we are sports people. We are looking for always doing better, pushing the limits. This is what we will try to do. You have seen the results over the last three years, more than three, by the way, which means that we will continue to push very hard. And I will start by fixing everything we did poorly in 2023. And you see that the product offensive that we are now bringing is expected to have some some impact, even if we have to recognize that there is always a window that is the ramp-up window, which is there, and we cannot do anything else than just protect quality in those important periods. Nathalie, anything you would like to add?

Yeah, I think what I would add of both of them is, one, when it comes to the revenue, I think we have, you know, yes, LEVs are great, but there's a lot of other positives out there, that we are executing well, we've got great products coming to market, and it really is something where we feel like we're starting in a strong position. We also believe, if you look at it on a regional level... that you're going to continue to see strength coming most from our third engine, but we believe there's positive revenue opportunity in all of the regions. So I think that's an exciting place to start the year. On the AOI piece, I think this is really more about the mentality of how we give guidance, and that's really something we start every year, and we look at what's going on, how competitive is it, what do we think the pluses and the minuses are, and I tried to give you some of those examples in the earlier comments. But I think we look at this year as saying, starting today, we think there's more headwinds than there are tailwinds. And the way we work as a management group is we say we have to show what we can do in terms of cutting our costs, making sure we manage our prices effectively, really driving all those positives. And only when we do that do we earn the right to look at being more aggressive in terms of how we guide the market and what we entrust in terms of our ability to deliver. But you heard there really are a lot of things, I'll say, whether it's the logistics or the raw materials, those type of things that are helping us. And we are going to be focusing very hard on every single thing that's in our control to deliver the best possible results.

Thank you, Natalie. Let's move to the next one. Thank you. Thank you, George.

Our next person in the queue is Patrick Hummel of UBS.

Yeah, thank you. Good afternoon. Good morning, everybody. If I may start, Carlos, you alluded to this at the very beginning, the production flexibility, the platform flexibility that Stellantis has. Can you just elaborate on that in a bit more detail? Is it right that basically every plant, every production line, can do with the Stella architectures, the BEV version and the ICE and hybrid version at the same time. So there is nothing really dedicated in terms of manufacturing assets. And how do you deal with that on the supplier side? As in, you know, you have different parts going into the ICE car than in the BEV. And the powertrain side, needless to say, the battery itself. So how can you make sure you've got enough flexibility on that front should we go through a phase of temporary weaker bath demand? And if I just may, one for Natalie, on the share buyback position and the balance sheet situation, great to see improved or higher shareholder returns. Net of those payments that are yet to come for the buyback and the dividend, you still have a really solid balance sheet with more than $20 billion of net cash left. Should we consider that like a war chest for any potential M&A opportunities? Or is there anything specific you have in mind on the investment front that needs to be taken into account in the budget? Thank you.

Thank you, Patrick. Those are three great questions. On the third one, I will comment on the M&A so that we don't get trapped. But, of course, Nathalie will be free to jump in. On the first two ones, first of all, One suggestion that we'll have for our IR team is to invite you to visit one of our plants so that you can see with your eyes the flexibility that we are able to demonstrate in dealing with a very uncertain world. Yes, I can confirm that we have multi-energy platforms. that can accommodate ICE and BEVs. A few years ago, I'm sure you remember, Patrick, perhaps not with you personally, but with a community of investors, two or three years ago, the message we were getting was, if your platforms are multi-energy, then they are not optimized for pure BEV, which means that the performance of your BEVs are not as good as the competitors. That's the message we were getting three years ago. I remember at that point in time, I asked our team to demonstrate to me what was exactly the trade-off. of having multi-energy platform against dedicated BEV or dedicated ICE platforms. And we made that study. We had several mock-ups. I want to give you the conclusion, which is quite simple. In fact, the only difference is in the way you position the AC system. the air conditioning system, which generally speaking is below the instrument panel. And below the instrument panel, above the tunnel, you have somewhere the shape of the AC system that is there on the firewall. If you make a dedicated BEV platform, you can push that AC system a little bit forward let's say about two to three inches max. So you take the AC and you push it forward in the engine compartment because the electrical components are smaller than a pure IC engine. And then you can compare two mock-ups, one with the AC as it is positioned for a multi-energy platform, and another one where you say, well, this is a dedicated platform, so I'm going to push the AC forward. Generally speaking, what is below the IP, mostly on top of the tunnel, is an area that you don't use because you have the driver and you have the co-driver. And generally speaking, everything which is below the IP instrument panel is dark. So the visual impact of moving that AC forward is marginal. And the actual performance in Ruminas is marginal of marginal, which this means that the benefit to the consumer of having a dedicated platform is almost nil compared to the diversity complexity that you generate if you have two kinds of platforms. We made that decision three to four years ago, despite the criticism. It happens that in a certain world today it's the right decision. It is proven to be the right decision. And we could show to you those mock-ups so that you can make your own opinion, but it's crystal clear when you make that study. So we are very fine. with that multi-energy decision on the platforms. The second thing is when you go in a plant where you are making BEVs, and you can go, for instance, to Ordin where we make the LCVs, and we make right now in Ordin the ICEs, the BEVs, and the fuel cells. Same plant, same line. So we can show it to you easily, and we see that what you have to prepare Upstream of the main line is the module that you call a battery pack. Yes, you have a dedicated small shop where you bring the trays, you bring the modules, you bring the harnesses, and you assemble the battery pack. Then you move the battery pack in the line, on the main line, as if it was an exhaust system or a gas tank, and you assemble it on the handle floor of the car. So, yes, this works because the level of expertise that we have in manufacturing and overall layout of our platforms is very, very high. And you can visit anytime. I would like to be there to invite you so that you can see it. On the... On the M&A stuff, we have already commented right now, nothing is ongoing. It is clear that if we are among the most profitable car makers in the world, we are in a better shape to face the Chinese offensive. than the ones who have half of our profitability to face that competition. And if that was to come, then the guys who are the most profitable today are the guys who would be in a good position to eventually capture any opportunity. Nothing more than that. Everything else is speculation. This is our thinking on that front. I don't know, Nathalie, if you want to add something to that.

I think when we look at everything that has to do with the balance sheet, the capital structure, the things that I would focus on are think about this as something where we're on a journey. If you look at our business a couple years ago, this is something where we had never done a share buyback. We started that last year. We looked at an opportunistic ability to capture more share when Dong Feng offered them in the second half of the year. We've now increased our dividend. We've increased our share buyback. And one of the things that's kind of been really central in that thinking this year was we said, hey, we want to move from something where we're building that position to a place where we're maintaining it. And we've done that. As we look going forward, we'll see how this moves along. I think we're very proud of what we're doing now. It depends, obviously, on what happens with our business performance and that we keep delivering at this high rate. But think of this as something where I think it's a great position to be in today. It is a real signal as to what we want to deliver the market, but it's by no means the end of the journey.

Thank you, Natalie. Let's move on. Thank you, Patrick.

Thank you. And as a reminder, please limit yourself to one question in order to allow all participants the opportunity to ask a question. The next person in the queue is Dorothy Cresswell of BNP Paribas XA.

Hi there, and thank you for taking my question. It's actually a follow-on to Daniel's earlier one, but honing in on less electrification strategy, because your NAFTA BEV launches obviously aren't that far away now. So I wondered how quickly will you be able to replicate the BEV profitability that you already generate in Europe today in North America? Thank you.

Well, thank you, Dorothee. That's a great question. You know, the short answer, which would not be as respectful as it should be because it's too short, is 2025. That's the short answer. In fact, most of the launches will happen in the second half. of 2024 at least for the u.s market except for the pro master ev which is already on sale and already ramping up so it's fair to say that given the sequence we have the full impact positive impact of our bev new launches will be visible in 2025 full year You will see some of it in 2024, by the end of the year, given the ramp-up that we will have. But that's the short answer. We will see that in 2025, full year scope, and the second half of 2024 will be the ramp-up. That's for NA. For Europe, you see it today. You have it today. You are going to see the ramp-up of the Peugeot E3008, which is going to be... a very important pillar of our business in Europe. This is going to start in the next few weeks as we are going to bring the cars to the showroom very soon. So Europe, you will see a full year of BEV power. One of the good things you can already see is that when you look at the BEV market share in Europe on the B segment, If my memory is correct, we have more than 60% BV market share in the B segment and the B SUV segment, both in Europe, which means that it demonstrates the competitiveness of our B segment, B hatch and B SUV products in Europe. When you look at the numbers on segment share, where you see the weakness in Europe is the C segment. You see that in the C segment, we don't have enough BEV market share. That's why we are now bringing the 308E version, the Astra E version, and, of course, in the C crossover, CSUV, the Peugeot E3008. So you should see, hopefully with us, that our BEV... Share in the C segment is going to grow. And there is no reason why we would not bring it closer to the share that we already have in the B hatch and the B SUV, which from the top of my memory in Europe is above 60% of share in the B segment in Europe. So that's the power of what we have in Europe. And we are doing this with profit. We are doing this with profit. Last but not least, if I add to the competitiveness of our products and the market coverage we have with our brands, the power of our sales financing arm, you end up with something that may be meaningful for you, which is the fact in the social leasing channel that has been created by the French government, we have more than 70% market share from the recollection of data that we have been doing, which means that when you add the competitiveness of our products and the power of our financing arm, you end up with a very competitive offering to our customers that they immediately accept at 70% market share using 10% eligible products that we put on the market, which is about 50% of all the eligible products that were put in the market. This is to say that it's a perfect demonstration of our ability to converge in affordability, profit, and product appeal. That's what this is. Now we have to do the same thing in the U.S. We have to be as appealing as possible. affordable and as profitable as it should be. And that's what we are preparing for the future. But the full picture will be visible in 2025. Thank you, Dorothee.

Next in queue is Michael Jacks of Bank of America.

hi good morning good afternoon thanks for taking my question and congrats on the great results and big step forward on shareholder returns going back to an earlier question on aoi i'm sure pricing is the most difficult variable to predict but it would be great if you could give us your take others on the pricing environment in europe and the us including the dynamics between bvs and ice And in conjunction with that, Natalie, whether strategies are included in the equation of puts and takes laid out in the guide, or if this is one of the weapons you have at your disposal to help fight against the various headwinds. Thank you.

Thank you, Michael. Let me take the first part and Natalie will take the second one. You know, the BEV story is an interesting one because we all know that we need to fix the affordability. which means the BEV story is a story about the race to reduce the total production cost in order to give back to the market more affordability while protecting the margins. So surprisingly, when we talk about the pricing power of BEVs, in fact, we are talking about cost reduction. That's what we are talking about. And it's interesting to see that one of the drivers of the total production cost reduction of BEVs right now is the fact that a great number of people are talking about the fact that the BEV sales growth is not as strong as what some would predict, and that has an impact on the raw material price. which means the raw material price is going down, which means total production cost of BVs is going down, which means it's opening the road for more affordability, and then affordability will bring more customers, and then there will be a reverse situation at one point in time. So what I want to say is that if we want to bring the affordability of EVs to the market, as we should. We need to accelerate the pace of total production cost reduction. We have tons of ideas for that. What I can communicate to you is that right now the pace of total production cost reduction of EVs is higher than the pace of total production cost reduction of ICEs, which means we are converging. Are we converging fast enough or not fast enough? I would always want faster. My team is doing a great job. I think we are among the best in doing that. We still need some time to converge fully. But I think that what we are going to see over the next two or three years is that, The affordability is going to be driven by the speed at which we reduce the total production cost as we want to protect our margins. And the people that are not going to protect their margins, they are going to put themselves in trouble, which is obvious. And some of them have communicated on the profitability of their BEVs, and most of them are red. Ours is black and significantly black. That's what I can share with you. Nicole, Nathalie, anything you'd like to add?

Maybe just from my side, the thing I would add on the pricing topic is... Yes, it is part of our EOI guidance, and it's one of those items where you're right, there's positives and negatives to that. When we look at North America, I think what's important to call out is we haven't seen any radical pricing drops. People have been pretty disciplined. Perhaps after everything that happened in the fall of last year, it's in everyone's best interest to be disciplined there. And the place where you do see it, and I'm sure that's what you were alluding to, is when you look at EVs, particularly in Europe, there is a different position there. But what we think about is always what can we control? And what we can control is that we want to maintain a strong pricing differential vis-a-vis our peers. This is something we've built up over the last several years and where it's really one of our key USPs. So expect if the market goes up and down, we're going to use that ability that we have as a company to with the cost savings, with the efficiencies, all those things that we're known for, to be able to maintain that relative distance, but also to have the flexibility to make sure we don't use it to the detriment in terms of how it impacts share in our position.

Thank you, Natalie. Next question. Thank you, Michael.

The next question comes from Jose Mendi of JP Morgan.

Thank you very much. Question, please, from the third engine. If you could please comment on the rate of growth you're expecting for the three regions in 2024, and also if you expect the margin or the profitability to remain so high in 2024 as it has delivered in 2023. Thank you.

Well, a great question, José. Thank you. The only thing I would like to share here is that if you go back to my statements last year or a couple of years ago, it is fair to say that the results that we presented to you with Nathalie are ahead of plan. We have seen such a tremendous... response from the overseas club which of course creates inside of the company some kind of competition which is which is nice and healthy where the third engine is indeed growing faster and in profit they double the profit in in 2023 against 2022 so on that front we are ahead of plan what does it mean it means that um I don't foresee that we would have our third engine at the level or close to the level of Europe later than 2025. And it could happen in 2024. Because that's really what we see. We see that we have the right products. We have the right pricing. We have the right teams. And most importantly, we are reinforcing significantly the local sourcing for the local markets. You may have seen that we have taken many initiatives. We are already 90% plus sourced in Latin America for Latin America. We have now upgraded our objective for African sourcing for Africa and Middle East to 90% in 2030. previously we were at 70. We just moved it to 90 because it's the same recipe. We want to source in the region for the region to be able to have in the region the right technology that the region wants. This is what we are doing. We have manufacturing entities in Morocco, in Algeria, in Tunisia, in Egypt, in Turkey, very soon in South Africa. So we have a very strong... footprint plan for Africa Middle East as the market is responding very, very well to our product offering. So we'll keep on doing that as fast as we can. We have a fantastic position right now in Algeria with more than 80% market share. We are now moving with the plant which is already in operations and we have more steps to go. So we see that, yes, the third energy is a big competitive differentiator against some of our other peers that have more a shrinking strategy. So we are there. We will keep on moving. And I would be disappointed if we were not on par with Europe by 2025. And I think that we have a good chance that it will happen in 2024. This is what I wanted to share with you, José. Thank you. This is, I believe, the last question. I just would like to close by expressing to you all my sincere appreciation for your support, for the quality of your questioning, because the quality of your questioning is making us think better. I would like to thank my employees. I would like to thank my top leadership team. because they give me the privilege of challenging them, and that's a big privilege I have, to be able to challenge them. And they are working super hard to create the returns that Nathalie presented to you today. And Nathalie has brought us a breath of fresh air in the way we understand you, we understand your expectations, so we expect to be doing a better job in the future. Thank you. Have a great day.