Alzchem Group Ag New

Dear ladies and gentlemen, welcome to the conference call of Altscam Group AG. At our customer's request, this conference will be recorded. As a reminder, all participants will be in a listen-only mode. After the presentation, there will be an opportunity to ask questions. If any participant has difficulties hearing the conference, please press star key, followed by zero on your telephone for operator assistance. May I now hand you over to Andreas Niedermeyer, CEO, who will lead you through this conference. Please go ahead, sir.

Yeah, hello. Good morning, everybody. Thank you for joining us today and welcome to our third analyst call for this year. As always, we start with an executive summary and then move on to the figures after some strategic topics. So at the end of the presentation, we will be available for sure for additional questions. So let's skip the disclaimer and go directly to the page four. So now you should see the page four. Let's start here with a brief overview of the overall situation. So after a good second quarter, which compared favorably to the previous year, the third quarter could not meet the previous year's results. With the continuation of the COVID-19 pandemic, it is becoming apparent that the weakness of the metrology and automotive market is persisting for Altschulm and is affecting more and more industries. Despite our broad product-based volume effects from, for example, the automotive, the aircraft construction, lightweight construction, or steel production and nutrition sectors, could not or no longer be fully compensated. So this also led to the fact that we had to issue an ad hoc release on October 14th with adjustments to sales and earnings. So far, we have been largely spared from direct COVID-19 cases of illness, even though the topic is a constant challenge and will regain importance. There is a rising number of reported cases in the districts in which we operate our factories. And I think we are on the highest line of incidents here in our district, what is really a bad situation. But our hygiene concepts have been effective so far and prevented further multiplication or domino effects of COVID-19 infections. at the workplaces itself. Usually, they came always from the private situation to the company. So, in the reporting period, all production facilities were stable and running without any COVID-19-related interruptions. Despite the generally weaker sales, selected business such as Netralt and BioSelect are performing very, very well. This takes us up straight to the next page, and there I will hand over to my colleague, Dr. Georg Michael Barmer.

Thank you, Andreas. Let me continue. As frequently reported in recent quarters, the neutral business has developed very favorably. In summer of last year, we successfully commissioned the first expansion phase, which we were able to fully utilize very quickly. Ongoing inquiries from the pharmaceutical and biocide industries have prompted us to start the next expansion step. The investment sum is expected to be around 12 million euros, which will result in a capacity increase of about 50%. The annual sales potential depends on the product mix and is comparable in size to the investment amount. but in any case, more than 10 million euros. Now, what was the detailed motivation for our investment at least this time? Continue on the next page. We have vast experience in the gas phase process, and via ongoing improvements, we make certain that we are a benchmark for the market. Our process is continuous, solvent-free, and therefore sustainable. we are seen by our customers as a very reliable source of raw materials made in Germany. But production aspects are only the basis. On the market side, there are developments that support our decision. Many of our customers search for a robust supply chain, and Altschem, as the sole non-Chinese supplier of nitriles, is a centerpiece of this strategy. This is especially the case for sartans, a kind of hard medication, and BIT, a biocide. In addition, more and more environmentally friendly pigments based on our materials are being developed and used. And for this, we are able to deliver. Despite, or maybe because of COVID-19, we have already been able to sell a substantial part of the additional capacities to our customers. This is what finally convinced us to initiate and implement this expansion investment, even in these unusual times. In September of this year, the first installations were started, and we have reached the final phase of the project financing with our banks for 10 million euros. So far to the neutral investment. Now let's discuss the specific figures on the next page back to Andreas.