Fagron Sa Ord

Hello and good morning everyone. Welcome to Farron's Q3 2026 trading statement webcast. I am joined today by our CEO, Rafael Padilla, and our CFO, Karin de Jong. We will start by discussing the company's performance and a closer look at regional developments. And afterwards, we will open the floor for questions. With that, I will hand over to Rafael.

Thanks Ignacio and good morning all. We're pleased to report another quarter of growth. Revenue reached 281.3 million euros, up 23.2%, or 19.5% at constant exchange rates. Organic growth at CR was 3.4%. Performance was led by EMEA and Latin America, together with Brands and Essentials in North America, which grew 26.1% organically. Our acquisitions also made a strong contribution. In North America, Compounding services was impacted by the third-party industry-wide IV back recall earlier in the year. Supply has now stabilized and we expect volumes to recover progressively through the fourth quarter. During the quarter, we completed the acquisition of INGEPLAST in Brazil. This means all previously announced acquisitions are now closed and integration is on track. Finally, we're confirming our full year outlook to revenue of 1.125 to 1.150 billion euros with an adjusted EBDA margin of 19.5 to 20%. Let's now look at the regions. In EMEA, growth was broad based across countries with organic growth of 6.5%. Compounding services led the way with 13.3% organic growth. driven by important new customer wins and strong underlying demand. Brands grew 7.3%, supported by new product launches. Growth in essentials came mainly from our recent acquisitions. In Latin America, organic growth was 9.7%. Essentials grew 11.9% organically at CR, supported by a successful Consul Pharma fair. Our acquisitions in Brazil added further growth. and Reported Revenue also benefited from currency. In North America, Brands and Essentials had another strong quarter with organic growth of 16.1% in Brands and 28.8% in Essentials. Compounding Services was impacted by the third-party industry-wide IV back recall, now fully resolved. And this explains the organic decline of 2.8% for the region. We continue making progress across our expansion projects and expect to bring them online over the next two years. Moving to our outlook, we now expect full year revenue of 1.125 to 1.150 billion euros and an adjusted EBDA margin of 19.5 to 20%. CAPEX will remain at around 3.5% of revenue, excluding the one of projects already announced. Looking ahead, we believe compounding services in North America has reached an inflection point, with IV back supply stabilized. At the same time, our expansion projects remain on track. Together, we add more than $500 million of revenue capacity in the 2025-2028 period, including Tampa, Wichita, and Las Vegas. As said, all announced acquisitions now closed, and they will contribute for the full year in 2027. We're also happy to announce that we'll hold a capital markets day at our Wichita facility in October 2027. We'll discuss our upcoming growth cycle as well as visiting the current Wichita site and at that time, the almost completed expansion. To conclude, Fagron is the only global vertically integrated player in fast growing fragmented pharmaceutical compounding market with a defensive high cost generating business model. Our diverse geographical footprint makes this model resilient, and this quarter shows the strength of that diversification. Together with demographic trends and our focus on personalization, this is the basis for our success. Our quality focus and operational excellence initiatives continue to unlock global synergies, while discipline, M&A, remains a key part of our growth. Sustainability is a strategic cornerstone for us, as together we create the future of personalized medicine. With that, let's open the line for questions.

Ladies and gentlemen, we are now ready to take your questions. If you wish to ask a question, please press pound key five on your telephone keypad. The first question comes from Stijn de Meester. Your line is open, go ahead.