Bekaert Sa Unsp/Adr

Good morning and welcome to the Bekaert Q3 2025 Trading Update Call. At this time, all participants are in a listen-only mode and we will open the floor for your questions after the presentation. If you require assistance, you may press star 0 on your keypad at any time and an operator will assist you. If you wish to join the queue to ask a question at any time, you may press star 1. Should you wish to remove yourself from the queue, press star 2. As a reminder, this conference is being recorded. It is now my pleasure to turn the floor over to your host, Mr. Dries van Hamme, Director of Investor Relations. Sir, the floor is yours.

Thank you. So, welcome everyone to the analyst call on our Q3 trading update. As usual, I'll read out the safe harbor statement before passing on to Sebo Parvi, CFO, who will take us through the sales updates, and then to Yves Kestes, CEO, who will conclude and give an outlook before we take it into Q&A. So, this presentation may contain forward-looking statements. Such statements reflect the current views of management regarding future events and involve known and unknown risks, uncertainties, and other factors. that may cause actual results to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Baycard is providing this information in this presentation as of its date, does not take any obligation to update any forward-looking statements contained in it in light of new information, future events, or otherwise, and we do not disclaim any liability for statements made or published by third parties and we do not undertake any obligation to correct inaccurate data, information, conclusions or opinions published by third parties in relation to this or any other publication issued by Descartes. And I now hand over to Seppo.

Thank you, Chris. And let's start by looking at the top line development. First of all, if I would describe shortly third quarter, it's fair to say that we had and experienced stable sales in the third quarter in difficult markets, and we have continued to focus very much on cash flow generations. Like for like sales in the third quarter brought in line with last year, we saw some volume growth in core markets, but like I said, we are very much also focused on cash flow and further cost improvements. If you look at the reported sales, we saw 3.8% decline due to the foreign exchange. That is a translation related. It relates to operations in U.S. and China. Both currencies have weakened during the year and obviously then converting to euro or base currency we see drop on the sales line. Exhausting for M&A as there are some capacity closures. That's another 30 million euros reduction on the report. It says beneath 8.5%. Sa Unsp-Adr Sa Unsp-Adr U.S. flooring business was improving in the third quarter for sustainable construction business. However, we still saw some effects of the tariffs, but especially the number of tenders increasing in data center business, but also in industrial and warehouse related flooring projects were picking up, but not at the same level as we have been in the previous year. And in the steel ropes business, we saw weaker demand both in Europe and North Then moving to 9-month sales bridge, where we are year-to-date. And like for like sales, decline was mainly driven by lower raw material costs. If you look at the reported 9-month sales, we had about 2% negative effect from the FX. And the end-to-end closures had the effect of 26 billion euros. So like for like, 24 sales were 2.9. Sa Unsp-Adr We had volume growth also in North America, but lower volumes in Europe, as well as in India, where we saw some increased competition from imports to the market. We have worked on optimizing our plant utilization, especially in China. That has helped us to support profitability and overhead coverage, as well as cash flow in the region. Also happy to report and tell about the new award recognition for our reinforcement innovation work done. We have received Greenpoint China sustainable case award for advancing low carbon tire manufacturing in ultra and mega tensile solutions. And then let's not forget our sales in Brazil, joint venture in rubber reinforcement business at sales of 33 million euros in the third quarter. Sa Unsp-Adr Sa Unsp-Adr and higher volumes also in China, supported by strong automotive end market, in addition to energy utilities market, like mentioned earlier. Then you have to remember, if you look at the reported sales, that there's an effect of about 30 million euros from SWS divestment in Latam, Costa Rica, Ecuador, and Venezuela businesses that were finalized end of the first half of this year. Sales in Brazil, joint venture, 166 million euros in the third quarter. And again, to remind that those are not included in the consolidated sales. And before moving to next, just to remind and comment those that we are expanding production capacity in US in one period, as the grid investments are supporting demand for transmission wires, one of our key businesses over there. Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr We continue to optimize our production footprint with traditional site closure now in Scotland and we are now consolidating our activities to Belgium. In ACOR's business, we were impacted by lower hoisting demand, especially low elevator demand in China and Europe as reflected subdued construction environment. New long-term sales agreement was signed for elevator hoisting belts with a key OEM. Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr In hydrogen, weak demand has continued, and that is also a reason why we have decided to pause production in veteran to address demand slowdown. However, I want to remind that we do continue our hydrogen-related production in China and Japan. And we continue our development work with the key fertilizer OEMs to continue our progress in the area and also to strengthen our position for the Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr Sa Unsp-Adr