Aurubis Ag Unsp/Adr

Good afternoon, ladies and gentlemen, and welcome to the analyst call. At this time, all participants have been placed on a listen-only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to Elke Brinkmann, Head of Investor Relations.

Good afternoon, and welcome to our Q2 2025-26 conference call. We will walk you through the results for the six months of our fiscal year. With me on the call are our CEO, Toral Park, and CFO, Stefan Hoffmann. After the presentation, we will be happy to take your questions. If you would like to ask a question during the Q&A session, please use the nine-star key tagline. Before we start, let me draw your attention to our disclaimer. We will make forward-looking statements today. These are based on current plans and expectations and are subject to risk and uncertainty. Actual results may differ naturally. That being said, let me now turn the floor over to Tuval Ha.

Thank you, Elke, and good afternoon from beautiful Hamburg. Before we dive into the details later in the presentation, let me provide you with a high-level overview of the performance in the first six months. Compared to the previous quarter, Rubus achieved a significant increase in earnings in quarter two of fiscal year 25-26. Operating EBT came in at 121 million euros, a 15% increase versus Q1. In the first half of 25-26, we delivered robust results, broadly on par with last year and in line with market expectations. Operating EBT came in at 226 million euros and operating EBITDA increased by 3% to 351 million euros. Net cash flow was 161 million euros and below last year's 190 million euros. This is mainly due to higher net working capital in connection with increased metal prices. Free cash flow before dividend improved to minus 63 million euros compared to minus 151 million euros last year, supported by over 100 million euros less cap expense. Operating return on capital employed was 8.1%, down from 10.2%, reflecting higher capital employed for strategic projects and lower earnings in previous quarters. In the recent quarters, key drivers of our business have developed in our favor. such as persistently high metal prices, improved recycling markets, as well as healthy copper product and sulfuric acid markets. Against this background, we have raised our guidance of the operating EBT in the current fiscal year to 425 million euros to 525 million euros. Let me now take you through the market environment. Sulfuric acid has certainly been an area of attention in the last quarter as Middle East shipping restrictions tightened the global sulfur market. As a result, sulfuric acid spot prices moved up sharply and even stayed above the already high levels. Supported by overall good physical demand, European spot copper premiums increased compared to the end of 2025. Still, premium levels remain volatile. European spot refining charges for scrap number two increased further, driven by high metal prices and hence better scrap availability. In contrast, spot TCRCs for copper concentrates stayed in negative territory, reflecting the still tight concentrate market. With regard to the price environment for key metals, gold and silver prices outperformed copper in Q2. In doing so, both precious metals once again reached new all-time highs before easing somewhat due to the conflict in the Middle East. The copper price was always stable at historical high levels. The strong performance of these key metals supported our metal result, as we will see later on. The EURUSD exchange rate was broadly stable versus Q1 and therefore had limited effect on our Q2 results. On a general note, please bear in mind that there is no direct one-to-one relation between the price development shown here and our P&L. As we hedge parts of our earnings, some of the effects will only become visible with a time lag. I would now like to provide some color on the Middle East situation and the effect on Arubus, since this is a frequently discussed topic in many calls and meetings. As we do not receive concentrate from the region and purchase only limited scrap volumes there, our exposure from a sourcing point of view is very limited. On the sales side, we also have no major exposure to the Middle East, for metal products or sulfuric acid. Direct risks are therefore low in the short term. Indirectly, higher oil and gas prices do impact energy and freight costs, but this is manageable. At the same time, sulfur supply disruptions and potential export restrictions support sulfuric acid markets as production of sulfuric acid from burning of elemental sulfur remains the largest source of sulfuric acid. A disruption of cathode exports from Iran and potential disruptions of SXEW production in consequence of the lack of sulfur supply could support global premium levels. Overall, from today's perspective, we anticipate more medium-term opportunities than risks for a ruse. In light of the current geopolitical situation, I would now like to provide a deep dive on sulfuric acid. Until 2030, global sulfuric acid demand is expected to grow further by about 3% annually, mainly driven by fertilizers and metals. At Aruvist, we produce more than 2 million tons annually and sell it to a diversified customer base. This base spends fertilizers, metals, and chemicals with a focus on Europe, Turkey, and North Africa. Around 85% of our sulfuric acid is sold under large annual contracts with quarterly or semi-annual pricing. About 15% is sold on the spot market, mainly to overseas customers, giving us exposure to spot prices. In 2024-25, sulfuric acid contributed roughly 125 million euro to the gross margin with a high conversion to EBT. Before I hand over to Steffen, let me give you a brief update on the U.S. tariffs, where an updated ruling was published on April 2nd. The updated U.S. tariff regime continues to bolster domestic copper recycling and therefore our over-switchment. A key change is that duties on copper semis and selective derivatives now apply to the full customer value, not just the copper content. More importantly, however, U.S. origin copper that is smelted and cast in the U.S. but refined elsewhere and re-imported to the U.S. can now qualify for a reduced 10% rate. While strict traceability requirements need to be fulfilled, this ruling creates access for U.S. origin copper to a WUBIS European smelter network. In this respect, our smelter network adds flexibility and enhanced supply security to U.S. customers as well. And now, let me hand over to Steffen Hoffmann, who will take you through the details of our financials.

Thank you, Doal, and welcome from my side too. Let's move to the financial details of the first six months, and I would like to start with the key KPIs of the second quarter. Quarter on quarter, our profitability clearly improved. Operating EBT significantly rose by 15% from 105 million in Q1, to 121 million in Q2. The main drivers were considerably higher earnings from processing recycling materials and from copper product sales. Net cash flow turned from minus 8 million in Q1 to plus 169 million in Q2, benefiting from, among others, an improved operating EBITDA. Let's switch over to the aggregated six-month overview. Group revenues increased by 23% to approximately 11.3 billion, mainly due to higher metal prices, especially for precious metals. Operating EBT was stable at the prior year level. A higher metal result, as well as slightly higher earnings from processing of recycling raw mats, as well as copper products, and sulfuric acid sales offset lower concentrate TCRCs. Net cash flow was 161 million Euro below last year's 190 million Euro, reflecting higher inventories in connection with high metal prices. Operating ROESTI decreased to 8.1%, which is attributable to lower earnings in previous quarters as well as our growth projects that are still in the implementation phase. These projects are reflected in the EBIT in form of ramp-up costs as well as in the capital employed and will unfold their full earnings impact in the medium term once ramp-up is complete. Moving on to the split of our gross margin, which is a good reflection of our multi-metals strategy, and the diversification of our earnings drivers. The total gross margin for H1 was about 1.1 billion Euro, up from approximately 1.08 billion last year. Overall, the contribution of the metal result to our gross margin increased year over year, which can be attributed in particular to the strong development of metal prices. Compared to last year, products and premiums remain broadly stable, reflecting the ongoing healthy demand for copper products. Year on year, the contribution from sulfuric acid was slightly higher, which is, however, masked on the slide due to rounding effects. In contrast, the total of TCRCs and RCs was down versus previous year, mainly due to the tightness in the concentrate market and the subsequent pressure on TCRCs. The contribution of RSCs for recycling raw materials was actually slightly up versus the prior year. Here again, rounding effects distort the picture. Long-term supply relationships and our focus on complex raw materials contribute to mitigating headwinds, in particular from challenging concentrate markets. This shift in the contribution of different earnings drivers resembles the resilience of our business model, which we continue to enhance with strategic projects such as Richmond and CRH, as well as the tankhouse expansion in . Now, let's move on to the segments, starting with multi-metal recycling. The gross margin increased by 11%. to 387 million euro. Main driver for the development was a stronger metal result, which has been supported by higher prices for gold, silver, and copper. Refining charges for complex recycling materials also improved and largely offset slightly lower throughput. Altogether, this translates into a disproportionately large operating EBITDA increase. Absolute EBITDA rose from 84 million euro last year to 103 million euro. Despite an around 13 million higher level of depreciation, the operating EBITD improved to 56 million euro from 51 million euro. Considering the EBIT of the last four quarters, operating EBITD declined to 1.2%. This was attributable to weaker financial performance due to one-off effects and project-related ramp-up costs incurred in the previous fiscal year. At the same time, capital employed increased by 30%, primarily as a result of significant growth investments, especially enrichment. In customs, smelting, and products, the cross-margin of about 710 million euro is composed of 51% products and premiums 36% metal result and 13% TCRCs for concentrates and RCs for recycling input. The slight gross margin reduction to prior year's level was caused by a sharply lower concentrate TCRCs trend we have seen over past quarters and anticipated in our guidance. On the positive side, higher metal prices and product sales had a positive impact on the segment's performance. Likewise, concentrated throughput increased to 1.25 million tonnes, reflecting good operating performance in Hamburg and Pira. This enabled higher sulfuric acid sales amid strong market conditions. In line with a slightly lower gross margin, operating EBITDA was at 279 million euro. Operating EBT was at 211 million, reflecting year on year 10 million higher DNA in the segment. Operating ROSI remained strong at 16.5% and only slightly below last year's 16.8%. Capital expenditure in the first half was below 150 million euro and used mainly for the construction of the Precious Metals Refinery, Complex Recycling Hamburg, and the Pirtop Tankhouse Extension. Let's now take a look at the cost development in the group. The total cost rose by €30 million, a 3% increase to €949 million. The main driver, however, was higher scheduled depreciation and amortization, of about 23 million Euro reflecting our investment activities and the ramp up of strategic projects. Personnel cost rose to general wage inflation and higher average headcount in line with our footprint expansion. Other operating expenses decreased slightly to 20% of total cost with logistics and administrative costs being the largest components. Energy costs declined to 8% of total cost thanks to effective energy management and hedging. Let me now deep dive into our cash flow bridge. Operating EBITDA was 351 million euro offset in the order of 152 million euro due to increased networking capital in connection with higher metal prices. within the networking capital position, increased inventories accounted for close to half a billion and higher receivables for nearly 240 million euro of cash outflow. Elevated metal price effects were, however, not limited to the asset side. Liabilities increased as well by more than half a billion euros. Including the outflow in Texas, Net cash flow came in at €161 million, down from €190 million in the prior year, but clearly improved from the minus €8 million at the end of Q1 of this fiscal year. Cash outflow for investing activities was €250 million, driven mainly by spending on Richmond, the new precious metals refinery in Hamburg, CRH in Hamburg, and the paired-up tankhouse expansion. Interest paid was limited to just 10 million. So free cash flow before dividend was therefore minus 63 million euro. This is an improvement of nearly 100 million compared to the prior year and predominantly achieved by lower capex spending. Looking ahead, for Q3 of this fiscal year, we expect a significantly negative free cash flow which is due to normal seasonality and is in line with our internal planning. And then for Q4, we expect a significantly positive free cash flow. And for our full year, we remain on track to achieve our free cash flow targets above break even before dividend for the full year. Before we move to our outlook and guidance, I would now like to take you through some of our balance sheet take the eyes. The equity ratio on an operating basis was 48.6%. The decrease compared to previous year was caused by the expansion of the balance sheet, driven in particular by higher working capital that negatively offset the addition of €175 million in earnings to the equity. But let us put the equity ratio into perspective though. The close to 50% level is still very solid and clearly above our larger than 40% target. And in the next quarters, we expect to return to the 50% levels again. Debt coverage defined as net financial liabilities overruling EBITDA increased to 0.6, also a result of higher working capital, yet is still well below our ceiling of 3.0. Capital expenditure for the first six months was 232 million, down from 340 million, reflecting progress in completion of strategic projects, as well as disciplined execution. Capital employed increased from 4.07 billion to 4.35 billion, reflecting growth investment and higher working capital. Let's now turn to the outlook for the key drivers of our business. Since our last update in February 26, our view on some macro drivers has improved. Overall, raw match supply remains tight but manageable due to our long-term contracts and diversified sourcing. Still, let it be mentioned that given headwinds and volatilities in our sourcing markets, it is also a stretch for our commercial teams to secure the right quantity and quality at the right time and place. Concentrated TCRCs remain under pressure, reflected in the reddish signal on the chart. For recycling, material availability in the recent quarter has improved somewhat, among others due to higher metal prices, and therefore we've been seeing better market conditions. Such improvements in market terms tend to trail the actual development and therefore take effect in our P&L with a time lag. Accordingly, we are taking a slightly more positive view than we did in February and have added a touch of green to the yellow traffic light. The Euro-US dollar exchange rate environment remains largely unchanged versus our previous assessment. Given the tight supply situation in the consequence of the Middle East crisis, sulfuric acid markets are very supportive. Correspondingly, we've colored the acid outlook completely in green. Metal prices, especially for precious metals and copper, remain persistently on a high level, and demand for our products remains strong, in particular for wire rods. Overall, this improved backdrop underpins our higher confidence regarding the outlook for the second half of the fiscal year. Based on the performance of the first half year, as well as the improved outlook for key drivers of our business, we have lifted the full year forecast for fiscal year 2025-2026 last Friday. We now expect operating EBITDA Euro and 800 million Euro. Operating EBT is now expected between 425 million and 525 million Euro for the group. Within this overall range, we expect EBT of 370 to 430 million Euro for CSP and 115 to 175 million Euro for MMR. For MMR, this takes into account that although ramp-up enrichment is making progress, a break-even on EBITDA level will still be a stretch this year. We have factored this caution into the segment's EPT range. We are now targeting and operating ROSI between 10% and 12% at group level with CSP at 15% to 17% and MMR at 8 to 10%. For net cash flow, we expect to be above last year's level, despite higher working capital, which is in part due to higher metal prices. We continue to aim for free cash flow before dividend, at least at the breakeven level, and are on track to achieve this target. This being said, please bear in mind that usual working capital fluctuations in high metal environments may affect our free cash flow at the balance sheet date. All these guidance figures are based on our current market assumptions and exclude any major unforeseen disruptions. And with this, I would like to hand over back to you, Thomas.

Thank you, Steffen. Before we wrap up today's presentation, I would like to update you on our strategic projects. With its first melt on March 23rd, complex restructuring Hamburg, in short CRH, was successfully hot commissioned. Since then, the plant has been ramping up gradually, with the first blister copper having already been supplied to the Hamburg primary smelter. CRH is a brownfield expansion that optimizes material flows and improves metal recovery at the Hamburg site. It allows us to process internal intermediates and around 32,000 tons of external complex raw materials per year. CAH will contribute to the group's cross-margin via TCRCs and RCs, as well as via the additional metal result, and thereby supports our multi-metal strategy. Turning to the other two projects that are in or near commissioning. At Arubas Richmond, Phase 1 is making progress. The central equipment has been commissioned, including key furnaces and supporting systems. We are gradually increasing the share of complex feed materials in Phase 1 as the ramp-up advances. Construction work for Phase 2 is largely finalized, and commissioning is the next step. In parallel to the technical activities, we are also scaling up our sourcing efforts and developing our North American supplier base in order to secure feedstock to operate the two Richmond phases. Building up the technical and commercial ramp-up curve takes time. In build-up, the tankhouse expansion is in its final stage. Technical installations and construction work are essentially complete. Current activities are focusing on testing and ensuring equipment operability. The gradual start of production is scheduled for summer 2026, which will increase refined copper capacity to about 340,000 tons from around 220,000 tons today. Coming to the final slide of our presentation, I would like to summarize the first half year. Quarter to quarter, we improved our EBT by 15% and achieved 121 million in operating EBT. In half year one, EBITDA of 351 million euros exceeded last year, while EBT of 226 million euros was in line with both the prior year and market expectations. The main positive drivers were a higher metal result and slightly higher earnings from recycling materials, copper products, and sulfuric acid. Free cash flow improved on a like-for-like basis as this year's dividend was paid in Q2 instead of Q3, while net cash flow was lower due to higher working capital. Operating ROCE is temporarily subdued because of our high investment activity and ramp-up costs, but these projects will support returns in the medium term. We achieved important milestones in our strategic CapEx program. First melt and first blister at CRH, continued progress in PILDOP, enrichment phases one and two. For the full year, we see metal prices at a high level and expect earnings from processing of recycling materials to be better than anticipated. We also expect our copper product business to perform well and now also expect earnings from sulfuric assets to improve in the second half year. Therefore, we raised our fiscal year 25-26 guidance to operating EBT of now 425 million to 525 million euros and remain on track to achieve at least a free cash flow break even before dividend payments. And with this, I would like to hand back over to Elke Brinkmann.

Thank you. Before we open the line for your questions, I would like to provide you with an outlook on the next event. On August 6th, we will publish our results for the first nine months of 2526. And our annual report for fiscal year 2526 is due on December 2nd. That being said, I now hand over to the operator for the first question.

Thank you very much. Dear ladies and gentlemen, if you are dialed in the conference call, please press 9 and the star key now to enter the queue. I repeat, the combination within the tower conference is 9 star. The first questions are already incoming. The first one is from Adana Ikuku Morgan Stanley. Please, over to you.

Hi, thank you very much for taking my questions this afternoon. Maybe just starting with Richmond and to clarify on the EBITDA contribution. The last quarter you guided this to be breakeven. I think just now you mentioned that breakeven will be a stretch for this year. Is that correct? And if so, what has driven this change?

Yeah, Adan, thank you for the question. Like we said, we had the first melt in September 25, and since then we've successfully gone into commissioning and ramp up. Since then we are gradually ramping up the plant. We have our first blister shipped to Europe, and we have stepwise increased the intake of complex recycling material, which is important, because with this we allow more valuable, the recovery of more valuable metals from scraps. And like we said, phase two is approaching the finalization of construction and will be coming to the commissioning. The ramp-up curve of the project implies that the buildup steadily moves forward. The slope of the curve may be steeper in certain periods and flatter in times of larger technical efforts. Due to some technical challenges in Q2 that are meanwhile solved, we were facing some delays in the recent ramp-up. So from today's perspective, we expect Richmond to end the fiscal year a bit below EBITDA break even. This assumption is part of the new and increased group guidance.

That's really clear. Thank you. You're welcome. And maybe just following up on the U.S. Do you have any updates on your thinking regarding the next steps for the U.S. footprint, just especially given the changes to the tariff regime last month that you outlined in the presentation?

Well, as we said before, we are in close contact with the U.S. administration on evaluating potential further steps. However, there is nothing imminent at this point. Our priority lies on the ramp up of the Richmond plant.

Okay, Pavit. Thank you. I'll join the queue.

Thank you very much for your questions. The next question is from Daniel Major, UBS. Over to you, please.

Hello. Thanks very much for the questions and congratulations on a good set of results. The first one on sulfur, you also provided quite a lot of details, so it's very useful. Can you just try and give us a little bit more flavor on the earnings sensitivity and how it relates to those kind of pricing contracts. So you did about $65 million of gross margin from sulfuric acid in the first half of this fiscal year. If prices were to stay at this sort of level, what kind of uplift will we see in the second half? Is it as simple as if the price doubles, we should just add an annualized 120 million euros to EBITDA? Is that the way we still should be thinking about the sensitivity? Hi, Daniel.

So as we've shown on the charts, you know that also in the sulfuric acid business, we are not very much exposed to the spot market. So 85% of the portfolio is based primarily on annual contracts with quarterly or semi-annual pricing mechanisms and only 15% exposure on the spot market. What I can say is in the guidance increase where we increased both ends of the range by 50 million and we were kind of labeling the 50 million due to better metal prices, environment, better acid and better sulfuric acid, roughly a third of that, so call it 15, 1.5 to 20 million euros would be attributed to an additional H2 effect on sulfuric acid.

Okay, thanks. So, yeah, so if we're to think about that 15 to 20 million on the second half, yeah, it would be fair to assume if prices stays here, that would continue and actually be higher into fiscal year 26, 27. Is that fair? That's correct. Okay, okay. Thank you. Yeah, and then my second question is, You mentioned around improved scrap contribution, improved scrap availability in Europe in response to the higher pricing environment. How do you see the broader scrap market? Is that sustainable? Are there any updates on legislation with respect to potential restrictions on scrap exports in Europe?

Well, Daniel, overall, like we said, the RCS are improving slightly. We see increased availability in general in Europe and U.S. with the higher metal prices. Nevertheless, we have to face also the Asian competition on the European market and also the U.S. market. So this is counterbalancing that. We expect some regulation in Europe to come. I mean, there's already some regulation in the U.S., but we expect some regulation in Europe to come hopefully in due course, but so far there is no timing that we can relate to. So these are the two counterbalancing effects.

Okay, thanks. And then one final one, and I'll go back into Q. The broader dynamics in the smelting industry, you've seen this continued negative move in the treatment charge with smelting companies, including yourselves. still generating resilient earnings because of free metals, sulfur, precious pricing, etc. I guess my question is, are you seeing any pressure or discussions around negotiating the other variables of profitability in a very tight concentrate market, i.e. reduced payability, reduced free metals, as China continues to stretch for getting enough concentrates?

Daniel, no, we don't see that pressure, high pressure on these other aspects of our contract negotiations. I think here it really pays out our, like you mentioned, the word resilience, that we have a diversity of our supply base. You know, we work with many mines together, and we have long-term relationships, and we also have a tight link to them. So we have a security of supply, but also apart from the TCRCs, quite stable other conditions.

Okay, thanks. I'll get back to you.

Thank you very much for your questions. The next question is from Maxine Coggey, ODDOBHF. Over to you.

Good afternoon, Jen. So the first question is for the work on surferic acid. I think you provided some insight on on yawning sensitivity but i mean if we take a high level view um it's difficult to actually make out what as what capacity has been actually destroyed uh what is just temporarily disrupted because of the closure of the straight over moves um what's your view on that what's your take on uh on the actual disruption level and how long it could take for them to come back to the market. So that would be my first question.

Yeah, Maxine, we don't have detailed numbers on this question, how much capacity has been destroyed. We see restriction, export restrictions from certain countries, which is helping the spot market I think more importantly is what we provide in the slide that we have a mid and long-term strong demand of sulfuric acid which is growing steadily and supported by different industries like the chemical and fertilizer industry. So I think this is important. But how much the important development of this market, but how much has been destroyed, we don't have the answer.

Okay, fair enough. And second question is on new capacity coming online in Europe. So there will be on the one hand the tank house by Boliden, which will restart again by the end of this year. You also have a big recycling facility in Spain at Atlantic Copper coming up in the coming weeks, actually. What do you think the impacts will be on refining charges for the Atlantic Copper Project and on cathode premiere for the Ronskartek house. Do you expect to suffer as a result from this increased capacity?

No, we don't expect any direct impact on our RCs because, like we said before, the demand for our copper products for cathodes but also other copper products remains intact and it's growing over the next years. So we don't expect any direct impact of these new capacities.

All right. And just the last one. So it's on TCRC. So for the Chinese metals have been able to avert a negative scenario where the benchmark would be below zero, so that was the case in 2026. But since then, the TCRCs have plunged further into negative territory. You're yourself quite immune because, I mean, you have your own contract, but you still have some learning sensitivity, some sensitivity to the benchmark level. So do you think a scenario where the benchmark

comes below zero can be again avoided next year given the recent evolution of the market well we cannot speak for the benchmark and as we always said our long-term contracts are not so much linked to the to the benchmarks we expect midterm the tcr fees to recover because of the overall market situation but in our opinion also it takes it takes some time so we don't expect a short-term strong recovery of the TCRC.

All right. Thank you. That's all on my side.

Thank you very much for your questions. Dear ladies and gentlemen, just a little reminder, if you are dialed in and would like to ask a question, please press 9 star now. And the next question comes from . Please .

Thanks for taking my questions. My first one is just a follow-up on the operational challenges there, which you mentioned with regards to Richmond. Is a low double-digit headwind the right ballpark when we think about what the second quarter earnings impact has been? And then also, have there been any other effects which you had in the second quarter, maybe which are a little bit more in the one-off in nature, any disruptions, for example, also from hedge rolls and so on. That's my first question. And then maybe related to that and the other projects you've got going on, maybe you could give us a quick update on how the other projects are doing at the moment and what the latest overall expectations are with regards to MTA contribution this and next year. I'll stop there.

Yeah, maybe first on Richmond, on the assumption of the headwind we had, your assumption is right. It was low double-digit million in Q2. Maybe Stefan on the hedging question.

Yeah, Bastian, I think you're referring to a remark that was in our documents that on CSB, kind of about offsetting effect from realization of hedging transactions. It's a bit of technical comment here. I think the most important message is both segments, MMR and CSP, benefited from the contribution of a higher metal result, which is linked to overall higher price levels. Further spot-driven upside was capped in CSP due to hedging. which is our normal course of business to avoid risks. And the effect was recognized in the CSP segment as the derivatives in question were allocated to CSP-related legal entities. So it's really a very technical effect. I would not overemphasize it. The key message is we earn good money on the metal price side. all record high spot levels due to our hedging strategy, but this is obviously the right approach for us.

Just on the duration of the Hedge Book, is it fair to assume that the main impact from the very strong metal prices is mostly coming in in the second half of the calendar year, assuming maybe like a 12-month duration in the Hedge Book?

It's basically coming in all the quarters of this year and also for next year. So as we speak, for this fiscal year on the precious metals, we are hedged at around 75%. I think at another occasion, we did say that for next fiscal year in silver, we are already hedged at 60%, in gold already at 50%. And that comes in every quarter. Obviously, it's fair to say that hatching decisions have been taken nine or 12 months in advance. So let's say what you see in this Q2 might be kind of the consequence of hatching decisions that have been taken nine or 12 months earlier. And so it comes quarter by quarter.

Thank you.

Maybe basking on the other questions of the other strategic projects, as we've reported before, ASAP and BOP in Berth and Ohlen, they have come on stream. They are now at the planned capacities, and CRH is also coming on stream and also looks like it's going according to plan. And the other two big projects which still need to be fully implemented are the tankhouse in Pirdorp,

in hamburg and both these projects are on track from also from a budget standpoint thank you and what does that mean for the overall contribution i guess the contribution now in 26 as well as what you now expect in 27. and well that can you know that for

Let's say the impact of the strategic projects, we were guiding that in the midterms, meaning in the fiscal year 28-29, we expect a contribution of 260 million Euro overall, and we would not give, let's say, the more detailed picture now on each fiscal year and speaking overall and with regard to the projects that Thomas just alluded to, we are in a comfortable position to achieve this mid-term target.

Okay. Got you. Fair enough. Then just one last question and just coming back on sulfuric acid. Now, I guess even when taking into account your contract structure, is there any reason why spot pricing shouldn't be coming through pretty much in full in the last fiscal year quarter?

I agree with you that obviously the impact that we see out of the dynamics Torres described earlier related to the Middle East, the impact should be rather in Q4 than in Q3. So what I said earlier to let's say 15 to 20 million increase in the fiscal year, most of it should be coming in Q4. And once again, Visibility is also low, and we do not know to what degree this favorable pricing level will continue. But you're right, major impact should be in Q4.

But then, of course, looking at the 15 to 20 million and your exposure to sulfuric acid volume-wise, I guess it makes the 15 to 20 million look very low. So I don't think you've been at the upper end of guidance factoring in anything near the current spot price. Is that correct?

I mean, you know that when we give a new guidance, then our focus point is the midpoint of the guidance. When I quote the 15 to 20, this is in focus to the midpoint. If you would want to argue more towards the upper part of the guidance range, then the impact of sulfuric acid would be more meaningful than the 15 to 20.

And at current spot, is there any guidance you could give us on like how maybe the fourth quarter exit run rate will look like? Obviously, when the metal results will probably strengthen further and particularly sulfuric and maybe the scrap site will obviously start to support as well. Would it be wrong to say that yield should be above a 200 million pre-dex run rate possibly?

I mean... I know where you want to get with me, and I would love to stay where we were. We stayed 125 last year, targeting a midpoint of the guidance with a larger impact of Q4. I would add, let's say, the 15 to 20 million. Now, talking about exit run rates out of Q4 into the next year, I would love to have that discussion with you later in the year. We still have a few months to prepare for that discussion.

Okay, fair enough.

Thank you so much.

Thank you very much for your questions. At the moment, there are no more questions in the queue. So, dear ladies and gentlemen, last call, please press 9 and the star key now on your telephone keypad. We'll wait a couple more minutes. Well, better to say moments. Everything seems quite clear. So with that, thank you very much. We are closing the Q&A session, and I'm handing the floor back over to the host.

Thank you. The IR team will, of course, be happy to answer any further questions you may have. We would now like to close today's conference call, and thank you for your attention. Enjoy the rest of your day. Thank you, and bye-bye.