Allianz Se Unsp/Adr

Ladies and gentlemen, welcome to the Allianz conference call on the Allianz Group Financial Results 2025. For your information, this conference call is being streamed live on Allianz.com and YouTube. A recording will be made available shortly after the call. At this time, I would like to turn the call over to your host today, Mr. Oliver Beter, Chief Executive Officer of Allianz SE.

Please go ahead, Oliver. Thank you, Andrew, but I thought you were the host. But anyway, I will be delighted to speak to you today. Thank you for your attention. I know it's a bit of a cramped reporting season. And a few of our friends have changed their reporting, so apologies if we are having a lot of information at the same time for you. Let me go through the slides and I will refer to the respective page as I go through them. We would like to just put a frame on what are we discussing today because a lot of things always around reporting season are very short-term numbers comparison. The key thing I would like to highlight today is less than 15 months ago, we saw each other at the Capital Markets Day here. where we looked at the three-year plan and put out at the time what many of you called a very ambitious plan for the next three years. 2025 is actually the first year of delivery on the three-year plan. So let's bear in mind what we were looking at in December of 24 and how are we performing relative to the targets that we've given ourselves. And I find that very important in times of short-term anxieties and how we do. If we turn our attention, please, then, to page A4 in the deck, the highlights. We are on almost every measure above what we could imagine in December of 24, whether there's revenue base up 8% for last year, operating profit up. Up 8%. And again, we had some questions. What about Q4? Claire Marie will talk about it. We are above what we thought in Q3 we could do at the upper end. And that's why we raised the outlook. Shareholder, core net income, double digit up. Dividend per share. double-digit, by the way, nine out of ten years now increasing dividend, again, this time double-digit, and we're very happy because we believe many of our shareholders want and need dividend for their retirement, and that share is only going to increase. Our solvency ratio, we've worked tremendously, and a big thank you to Claire Marine and her team, together with particularly our colleagues in Stuttgart, and having worked on strengthening that At 218, more importantly, please look at the stress tests and the solvency post-stress test that we have solved. We wanted to be very resilient after a financial crisis. If you run even the combined stresses, you will see that now that scenario looks pretty good, and we have more to come. Remember from the sale of our Indian participation, a few points, the solvency tool revision, so we should be in very safe territory versus potential shocks. From the financial side, in core equity return is 18.1, another point up in two after last year. We said in the capital markets day for further reference above 17%, so we're comfortably there. And we've also, as you will see later, have very strong capital generation. So not just the solvency is very good, but the key thing is OCG has been exceptionally strong. Liquidity is very strong. And that's why, because that was one of the questions, we have decided to do 2.5 billion share buyback because our cash generation power is very, very strong. And we still believe that our share price is a very interactive investment for our money, particularly relative, and we'll talk about it, to other investment opportunities. This, by the way, true for a number of our peers in the industry because the insurance sector has been de-risking and improving earnings quality over the last few years. When you turn, please, to page A5, we do a little bit of a deep dive in some of the numbers, a bit more top-down, though, relative to what Clemory is going to tell you. And for the two businesses that I believe we run, retirement and protection, Every single KPI that we really care for has seen an improvement. That's rather unusual for many places because if you think about the size of the Allianz, we really are now very happy about all segments delivering, whether that's the life insurance side, asset management, cost income ratio improving to 60.7%. record net flows, 139 billion. A lot of that in PIMCO, but also AGI, which I think is quite remarkable, 7% organic growth. 93% of our investments are outperforming three-year benchmarks. So there's a correlation between flows and performance, so that's really strong. The core of what people typically look at, the P&C retail side, 92% combined, while reserves continuously being strengthened. Commercial lines, the same, even below 92. And what we look at, as you know, have been for a few years, growing the protection outside, the operating profits is up 10%. So put it any way you want, you will find a hard time really poking into the delivery, which is what matters, Allianz. Now, it's not just 25. Let me go back to, it sounds a little bit self-serving, if I may say, because I've been CEO for 10 years. But what we really put out with the renewal agenda and its chapters is we want to build a company that resoundingly delivers, even under adverse circumstances. Remember, we have had COVID, we are having the war in Ukraine, we are having enormous problems with trade, we have the US dollar trending down, so affecting massively our earnings from the United States. Maybe as a reminder for everybody, 50%, even our P&C premium, is denominated in non-euro currency, so exposed to foreign exchange. Despite all of these things, the dynamics have been very positive, whether that's in accelerating, whether that's on revenues, operating profit, earnings per share, and dividend per share. And we are all very proud of that. Now, the question is always, you say, well, this is the past. We're pricing for the future. But as a small reminder, we are running here a business that is trying to do well over long periods of time, not just for the next quarter. Now, why are we doing really well? So I talked about the sector environment having been positive. We also had some positive effect last year when people want to point out, OK, where were we lucky and not just good? Yes, we had a little bit less net cut than was in the budget. But remember, that can change very fast. Just the $300 million we had in the fourth quarter from Australia, just from a three-day hailstorm, can very quickly change the equation. But we also had massive against headwinds with the US dollar. And these things we really need to be prepared for. The way we think about it is not just resilience of the financials, but actually having an organization, and we're going to be talking about it, that we're trying to make bulletproof relative to the challenges we have there. Whether that's political tensions, i.e. having a fully diversified portfolio in terms of channels, customer segments, product and geography, but also being able to help society with increasing issues around affordability of products, alternative investment challenges, climate change, and then, of course, the AI revolution that is going to come towards us. And we'll probably talk about it. Against that, we keep on investing in a number of things. Customer loyalty is super important. NPS, I'll give you some more numbers. And again, these are numbers that we have audited. They are not self-acclaimed. The brand strength is super important. We are growing brand value. And it's not just interbrand. It's brand finance. It's Ilman trust parameter. So the trust in the brand has never been higher. And we have the highest ever level of engagement of our employee base. And let me show some details. That the ratings are very strong is a matter of itself. So let's look at page A8 again. For some people, it's becoming a bit boring to see upward sloping curves like that. And, you know, are we manipulating them? Let me repeat. NPS. And these numbers, brand value, we're not determined by us, are externally audited because we run them, and they are numbers benchmarked against competition. So we had 70% of our businesses now being loyalty leader, and they're moving up. We still have some that we're not happy with, but we're not allowing anyone anymore to not be above market. Employee satisfaction on the right-hand side, or motivation, we have typically two numbers. We look at the motivation plus what we call a work-well index, i.e. how safe people feel at the workplace. By now, we are best in class for both of these numbers. When we started, by the way, a few years ago, in earnest, we started managing the details at around 2018. We could have not imagined to go where we have been. Now, that's based, again, on deliberate strategy and is not an accident. I will not go through page A9. But as a reminder, we have three main levers determined and described in the Capital Markets Day December 24. It's around driving smarter growth. Remember, the historical issue for Allianz, particularly in Europe, was insufficient customer growth, organic customer growth. The second one is further reinforcing productivity that was already in light of the ensuing AI revolution. So for us, AI is nothing new. We've been working on that for quite a long time on pricing and other items. And further strengthening resilience, because as we move into very, very uncertain times, we want to make sure not just the balance sheets and the ratings are strong, but also the organization is really reinforced whether we have the threat of cyber attacks or other stress that can be put on to the balance sheet, which may be coming from regulation. Let me give you a couple of examples. Let me start by page A10. The growth in our underlying customer base is increasing. If you say, are we where we need to be, the answer is absolutely not yet. We're starting the flywheel in Allianz. And as you know, large organizations always need time to really work on it. We needed to put the prerequisites into place. I talked about brand, product quality, service quality being on the rise. And particularly in light of rising prices, the price to value perception is always super important. It comes through very strongly in NPS. The challenge is basically in two areas. The first one is churn. We talked about it. We still have too much churn in the system. We're working on it. and systematic bringing that down that would require two, three more years until it is where it needs to be. But where we are doing better in my mind than I thought possible is in terms of winning new customers. So we've had enormous successes, and I can tell you just one example. And we started with the turnaround of our business in Germany around retail customers. We could have not imagined going back over 10 million cars that we have now. At some point, we had lost 4 million cars in a row over about 10 years. We've been coming back from the low point at around 88.2 million cars, and we're going up. Now, motor insurance is something that's highly competitive, so we're not doing it for the volume. We want to create value, so that's happening at the moment at very attractive rates and good levels of profitability. I have mentioned cross-selling is a very important point. There are countries where we have never had success in cross-selling. Italy is one of them. We are improving our ability to increase that and there will again be more work to be done. Last but not least, for us it's very important, we have consequently invested in the so-called platform business, Allianz Direct and Allianz Partners. And you see improving levels of growth and of profitability at the same time as we are starting to see returns on building scalable business models. Obviously, you as investors want to see that across the group. And this is one of the pre-comments I'm going to make on AI. The way the technology will make it easier for Allianz to now harness. We'll talk about that later. productivity gains and best practices across border because we will not be needing to go through very onerous IT processes to do so. Let me move further on the health and protection side. There's a couple of things that I would like to highlight. First, we have been a winner in a number of emerging markets on health for a long time. Turkey, we are by far the market leader and we're accelerating our advantage, but even in Germany where 10 years ago many of us were asked, why do you actually have that business? Can it actually do well relative to the universal cover in the system? We are growing leaps and bounds, and that's because we have been reinventing the business model, completely new products, both in comprehensive cover, supplemental cover, true market extension through our digital health product, true market extension through innovation on group health product, particularly with the innovations post-COVID, now companies are finding it very attractive to increase employee retention and engagement to having supplemental health cover. So a true success story, 364,000 new customers just in German health with very attractive margins. Something, again, a lot of people would not think possible. And let me pick up another example. People for a long time, there is no way to cross-sell in the agency forces. Really, we are product sellers. We're not really client advisory. In France, our agency channel has seen a significant uptick in cross-selling into protection with very attractive margins and the numbers you see here versus prior year and versus 2020. So we are on the move on health and protection, and we're working hard to continue that because it's a product that's both attractive for society and customers and attractive for shareholders. Now, let me move on to productivity. And at the risk of getting on your nerves, this has been a multi-year journey. What you don't see on this page is what the peak was. We started with a P&C expense ratio of 28.6 in 2018. That was the peak. And we've come to 23.9. Yeah. So almost five points reduction. And we continuously will try to meet and work very hard to take out 30 bips a year on a like for like basis. Ladies and gentlemen, that means we have been taking out 20 percent of the relative cost base. That's not true because we obviously had pricing effects on the portfolio. But on a relative basis, this number means like for like today we operate 20 percent less cost. And we haven't really fully embraced all of the opportunities that we have across the entire value chain. Claire Marie can also talk, by the way, about her finance transformation program. We're working on the service units. So we are looking at it at the entirety of the value chain. And let me point also out to the fact that most people are telling you you can only do it on everything that's not related to distribution. It's not true. It's not even true for Allianz. You see what we've been able to do on acquisition cost. And again, we haven't really reinvented the model. We've been working on pretty layman and laywoman levers in order to drive productivity up. So there's a lot more to come. It's coming from a few levers. One, we have decided some of the extraordinary gains that we're expecting this year, we're going to reinvest. We're already spending six and a half billion in tech, and we're getting more and more focused on new innovation and new functionality versus running the machine. So there's enormous pressure on the running cost of the machine to free up investment into new things. We are going to broaden our focus on unit cost and factor productivity across the entire organization. I mentioned that. So Andreas Wimmer is leading a program on life. And you see it, by the way, already in the numbers for AGI. A lot of people had questions on whether they can do this. They're making great progress. PIMCO has always been very good at it. And now, again, doing step changes on redesign of process. Yeah, I'd like to say it is first to focus on better client experience. We really believe that artificial intelligence and any type of automation has the primary objective to make our product offerings more distinctive. So we're less worried about cheaper and cheaper and commoditizing what we do. We want to build a differentiated product and service offer. That is the key priority also for the deployment of Gen AI. And we are trying these things out in what we call our platform businesses. Because this is where we see these things fastest, and it's digital first. So this is where we also have to be the most competitive on customer service. And when you look at the growth patterns in both businesses and their margins, you see scale at work. So that's really important. The next step for us, and we can talk about it if we have the time, is to help our customers to address the issue of ever-rising prices for insurance product, i.e. addressing product affordability. by offering distinctive services that effectively reduce the cost of risk. Now, let me continue on resilience before very soon I'm going to hand over to Claire Marie. So all the finance numbers you're going to get from Claire Marie, the only thing I wanted to say is we are increasing the opportunity Operating capital generation, you'll see that. So solvency to improvement is not risk reduction really only, but it's really generating more capital and more cash in light of what we have promised to you. 25% OCG this year, and we're working on having 23 to 24. Remember, that was the number. Cash remittance, 89%. across the business and having lower leverage than we used to have. This is what we want to do. Again, these are just the financials. We are also working on making sure the organization is more resilient, i.e., we can react to shocks wherever they may come from, whether that is cyber attacks or other kinds of shock that happen in our environment. Now, last but not least is always a major form for short-term discussion on should we not have a different methodology for outlook? The answer is no, not for now. We are increasing that by 9% from 16% to 17.4%. We obviously have the ambition to beat that. So we will work day and night to make sure that we do more than the midpoint. And we have been, when you look at the numbers very carefully over the last 10 years, for most of the time, been able to do that and we will strive to continue to build that track record. So this is the confidence, but we also will remain conservative. Let me end that as people saying that is, are you confident? Look, guys, if we have a further massive devaluation on the US dollar, it can easily take a billion out of the OP in terms of conversion, just to give you a number, right? And that cannot be excluded. We don't expect that, but we want to be erring on the conservative side Over deliver rather than over promise is the mantra that we're working. Thank you.

Thanks a lot, Oliver. So good afternoon from my side as well to all of you. Really happy to be here today. Maybe like starting on page B3, before we dive into the numbers, I want to give you maybe a short overview. So you have heard it already from Oliver. We had a very strong overall picture in terms of performance. What we see in our numbers is growth, is profitability and its resilience. And this is clearly demonstrating that we are on an excellent path. path when it comes to the delivery of our mid-term targets, so our capital market day delivery. So this performance is fueled clearly by the focus we have as an organization in terms of execution of our three strategic levers, growth, productivity, and resilience, also as already mentioned by Oliver. And what you can see as we go through the material, I will say my section, but also the detailed part of the numbers, you will see how both our sustained financial momentum and our disciplined attention to resilience is actually supporting our confidence when it comes to 2026, and I will say even beyond 2026 very clearly. So if we go into the numbers and if we start with the top line, our top line reached a record level of 187 billion with an internal volume growth of 8%. And here, all segments are contributing to this positive development. For all segments, this growth is either in line or above our capital market ambitions. And on a nominal basis, we have seen a strong FX effect in particular in the second half of the year, which is impacting all segments. And Oliver has already highlighted some of the effects as an example on the PNC side. Our operating profit grew by more than 8%, emerging at 17.4 billion, which is our highest level ever. And this is as well above the high end of our original outlook and as well above the capital market day expected growth rate we had communicated in December 2024. PNC clearly had an excellent year, but both life and asset management deliver strong performance as well. We have an FX impact just below 400 million euros in our operating profit. So excluding the FX effect, to get a sense of the true underlying picture of the performance, our operating profit growth would have been around 11%, with PNC at 17% and asset management at 7%. This year, we have a better non-operating profit, which together with our operating profit results in a very strong core net income growth and core EPS growth of 13%, which is also clearly above our 7% to 9% capital market day target range. This 13% is building on a 12% growth that we have already achieved last year, which is making our EPS journey very attractive. In addition, our ROE is also nicely above, strictly above 17% target, emerging at 18%. Finally, our solvency to ratio is at a strong 218%. This is the highest level it has been for over five years. This is demonstrating our resilience and our focus on this as an organization. Moving to P&C, and if we look at page B4, here you can see that for the year our top line achieved its highest level ever at 87 billion with 8% growth, and we have both price and volume which are contributing roughly equally to this development. Retail P&C growth in particular is at 9%, and as Oliver has already mentioned, our initiatives to increase our underlying volume growth are making good progress, achieving 3.5% in the second half of the year. As you can see further in our material, so in section C, this growth is broad-based across our portfolio. On the rate side, we are overall at a healthy level of 4.6% for the year. With retail, where we are at 7%, where we expect the price discipline to continue and to keep pace with claims inflation in 2026. And in commercial lines, we are close to 1% rate increase. Our book is very diversified, as you know, meaning that there are parts where rates are harder in some segments. Overall, across our portfolio, we see many opportunities to continue our growth path at profitable levels. Talking about profitability, as you can see, our combined ratio emerged close to 92% for the year. This is clearly an excellent level, and both our retail and our commercial lines of business are contributing to this development. Once again, you can see further in the material how diversified this performance is as well across the portfolio. The main driver for the positive development of our margin compared to 2024 is a further improvement of our fundamentals in the attritional loss ratio, which I am very happy with. Although we do have some accounting effects between attritional and runoff, I already announced in the third quarter, which are reducing a bit the readability of this aspect. Overall, the low level of NATCAT we have seen in 2025 is offsetting the decreased level of runoff and discounting. Even though we have seen quite some CAT activities in Australia in the last quarter, our NATCAT experience was better this year compared to 2024. Finally, as communicated in the third quarter, we have been very conservative in our year-end booking, both in terms of runoff and in terms of current accident year peak, and we have further increased the level of prudency in our balance sheet. We also did continue, as mentioned by Oliver, our focus on productivity, with our expense ratio further reducing by 30 bps versus last year, as expected in this number. So while the investment results were slightly lower compared to 2024, in 2025 this is mainly due to ethics. Our excellent technical performance and the growth we have seen allow our PNC operating profit to emerge at 9 billion. This is 14% higher compared to last year, well ahead of our capital market assumptions of 6%. So overall, we are very pleased with the performance of our P&C business in 2025. We see excellent performance in both retail and commercial. This performance is not due to a better NADCAT environment, but raises a reflection of excellent volume growth, positive underlying margin development and prudent current and prior year reserving. This positions us very well for the year ahead. Let's move to page B5 and let's have a look at our life and health business. There, starting with growth, you can see in this page that our PVNBP emerged at almost 85 billion euros, its highest level ever, with a growth of more than 5% FX adjusted. This growth comes after an exceptional new business development in 2024, where you may remember that we had seen at that point in time 22% growth in PVNBP back then. So I'm very happy with the new business we have captured in 2025. And we also see a good increase in net flows across our portfolio on the life and health side. We continue to operate at an excellent level of new business margin, continuing to benefit from a focus on our preferred lines of business, with a contribution of protection and health and unit link up to 51% of the value of new business margin. Adjusted for the disposal of the GV with Unicredit, the new business profit of protection and health and unit linked grew by 11%, slightly ahead of our capital market day assumptions. Like in PNC, our performance across the portfolio is quite diversified. So Oliver has already outlined some of our success stories in health, so I can add some positive highlights on the rest of our life business, with, as an example, the Italian team, which has grown by 20% its value of new business adjusted for Unicredit, or the Asian team, which did grow its sales outside of Taiwan by more than 14% last year. The live CSM development over the year is better represented on a net basis, which allow for reinsurance and tax effect. And you can see, so in the middle part, that the net CSM adjusted for FX grew by 7.5%. Net of reinsurance, the non-economic variances in the development of the gross CSM are modest, mostly reflecting the US labs experience. The earning of the CSM in the operating profit is in the upper end of expectations. So looking at operating profit, we emerge at 5.6 billion, which is ahead of our outlook. This operating profit growth is around 4% as he suggested, and close to our medium-term expected growth rate with this adjustment. In the fourth quarter, operating profit on a standalone basis, our level of operating profit is a bit lower than our recent quarterly run rate of approximately 1.4 billion as a result of some of the changes, charges that we have taken for some legacy medical business in Asia. So overall, for the life and health business, we are pleased with the level of growth and profitability of the new business in absolute, but as well considering the demanding comparison to 2024. We see very healthy inflows and a steady development of both in-force and profit, which gives confidence for 2026 as well. Moving to asset management on page B6. Here you can see first of all that the level of organic growth of our asset management business reflected in the flows developed strongly over the course of the year. We have seen a total net flows of almost 140 billion euros and an organic growth rate of 7% for the full year. In the fourth quarter, the trajectory continued with 45 billion of net flows, a record for a fourth quarter, with strong organic growth at both PIMCO and AGI. The trajectory at AGI in the second half of the year is very pleasing to see from my perspective. So it's true from a flow perspective, but also true from a productivity perspective. Our net flows continue to be supported by our excellent investment performance. We have a share of 93% outperforming asset and our management against benchmark on a three-year basis, so clearly adding value to our customers. Net flows are diversified across geographies and with strong developments as well in terms of new products and distribution initiatives like the PIMCO active ETF suite with nearly 50% growth in 2025. This excellent flow momentum is continuing into 2026 at both asset managers. Revenues in the middle part of the chart emerged at 8.5 billion, with margins broadly stable and lower performance fees compared to last year. Both asset managers have done an excellent job when it comes to productivity. And we emerged with a segment cost-income ratio below 61%, which we lent at an operating profit of 3.3 billion euros, a 7% growth, FX adjusted. So overall, the performance of the asset management segment, also given the FX impacts, has been excellent in my view. We see a record level of third-party asset and our management, very strong flow momentum, stable fee margins and an excellent focus on productivity. So I'm very pleased here as well. Moving to B7, as you may remember, resilience was an important aspect of our capital market day at the end of 2024, as we continuously strive to secure reliable delivery of profits, capital generation and cash. So here I'm coming back to the framework and my dashboard that I had laid out at the Capital Market Day. As you know, we look at resilience holistically, and here we have seen clear positive developments over the year, also as we work structurally on the various dimensions of the framework. So as an example, we have seen a strong operating profit evolution despite the FX headwinds, and we continuously enhance our technical excellence in our P&C business to ensure a good preparation to the cycle. We have generated 7 percentage point increase of our solvency to ratio from a refined work at modeling implied volatility. Our solvency to capital generation is at an excellent level, also supported by the early benefits of the focus we have given to that metric. We have further improved our downside management, and this downside management goes even beyond the significant improvement in post-trust solvency 2 of plus 11 percentage points, for example, to include further diversification of our insurance structure, or during the year, we did broaden the scope and the nature of our scenario testing to further reflect the geopolitical environment. So overall, a lot of work with positive concrete outcome as well in the numbers. Let me zoom into the solvency ratio development on page B8. So here, our solvency ratio emerged strongly at 218% at your end, which is 10 percentage point increase versus your end 2024. So you have the rounding effect. It's not that I cannot do the math between the two on the slide. As you know, we set a target to improve our operating capital generation at the capital market day. We have decided to improve this from an historic level of around 20 percentage point to 24, 25 percentage point in 2027. We anticipated this would be a journey, as you may remember, as the natural operating capital generation from our business growth in the plan was more naturally around 22 percentage points. So now, with all the early work we have done on the operating capital generation and the very strong performance we have seen in P&C in particular in 2025, we emerged at an excellent level of 25 percentage points this year. And there are a few one-offs in that number. So why I'm very proud of the achievement and of the outcome of 25 percentage points, we would estimate that the underlying level of sustainable capital generation is more around 22 percentage points in 2025. And this is the expect I will start with towards 2026, is a base from which we hope to generate at least this level in 2025. Our sensitivities have slightly reduced over the year and combined with the overall increase in solvency means that our solvency 2 position post the combined stress is now around 197%, which is almost 200%. This is a very strong position to operate from for the future. Moving to remittances, on page B9, here you can see that our net cash remittance for 2025 is at 8.6 billion euros, which is slightly ahead of our capital market decommitment, as is our remittance ratio of 89% against our 85% target. As previously, remittances continue to emerge from a very diversified base. FX is as well playing a role in the year-on-year comparison of the cash development. So on a normalized basis, our remittances grew at least in line with the operating profit growth. And on top of our normal cash remittance, we did receive the proceeds from the first tranche of the sale of the Bajaj joint ventures a few weeks ago. So from a cash perspective as well, we are in a very healthy situation, which gives us also flexibility for the future. Moving to the outlook on page B10, and here, indeed, as already mentioned by Oliver, we are keeping our traditional approach to base our outlook on the delivered operating profit of the previous year, so 17.4 billion plus minus 1 billion. This is a 9% growth compared to the outlook midpoint for full year 2025, which itself was 8% above the one of 2024. So even if you take just the trajectory of the midpoints, we clearly see our earning powers that continues to grow strongly and ahead of our capital market commitment there. Our range is unchanged versus last year and allows for certain uncertainties, typically around capital market volatility, FX and PNC net gap. The details on the main assumptions which are supporting the various components of our outlook are in the back of our presentation to really explain what's happening to each and every component. I also would like to mention that, as announced, we plan to neutralize the IFRS accounting gain related to the disposal of the Bajaj joint ventures. This gain will be reinvested partly in productivity initiatives and also in accelerating reinvestment of bonds into higher-yielding instruments. Importantly, both of those actions will have a positive and lasting impact on our future earning power. Finally, the share buyback we have announced yesterday will continue to support our EPS growth journey, standing at 14.4% at this point against our capital market day target, a very attractive level. Let me recap on page B11. Clearly, I'm very pleased with our performance this year. With our operating profit above the highest point of our original outlook range of 16 billion plus minus 1 billion, we are in excellent territory for the delivery of our targets for the three-year capital market day cycle. Importantly also, we have not only delivered a very strong financial performance, but we have as well increased our resilience across all metrics. This is an excellent achievement too. Both the financial performance momentum and the resilience of our organization provide a very supportive environment to our dividend proposal and our share-buy-back program. It as well gives full confidence towards 2026 and our ability to sustain value creation for all stakeholders. With that, I thank you all for your attention and I hand over back for questions to you, Andrew.