Evonik Inds Ag Unsp/Adr

Ladies and gentlemen, welcome to the Evonik Industries AG Q3 2025 Earnings Conference Call. I am Mathilde, the course call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and 1 on your telephone. For operator assistance, please press star and 0. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Christian Kohlmann, CEO. Please go ahead.

Thanks a lot and welcome to our Q3 earnings call. Looking around in our boardroom, I see a very different setup here today. First of all, welcome to Klaus Rettig, our interim CFO, who is sitting left to me. Many of you already know him. In his previous roles, he represented Evonik at many investor conferences and capital markets days. His extensive experience and knowledge of our company is helping us, helping us in his new role while the search for our CFO is ongoing. I would like to take the opportunity here today to thank Maike Schuh for many years in different roles at Evonik. She has left the company at her own request, in September. And while this was very sudden, we have to accept that. I would like to thank her for her efforts and the positive impact she had in our organization. Second, after 49, worthwhile to repeat, after 49 reported quarters as a public listed company, Tim is not sitting on the right side of this table anymore. For more than a decade, He has built an investor relations program, which is highly regarded by all of you out there. Now, he's taking a well-deserved sabbatical. Thank you, Jim, for your lasting commitment to the Evonik Equity story. Christoph, whom all of you already know pretty well, will have a strong foundation to build on in the coming years. And with that, let's go into today's results release. We will be largely focusing on the outlook during these short prepared remarks. You will know that we are facing a very tough environment currently. Although already coming from quite a low level, customers currently are acting even more cautiously across all segments and in nearly all end markets. Demand stayed very weak, exiting the summer break. That is why With our pre-release end of September, we had to lower our full year guidance to around 1.9 billion euros of adjusted EBITDA, coupled with a cash conversion rate between 30% to 30%. Here, and our look today, goes ahead into the fourth quarter. For that, I'm now handing over to Klaus, who will show you why we are confident to achieve our outlook for both EBITDA and cash conversion in the last three months of the year?

Yeah. Thank you, Christian. As you already said, today I'm here in my role as interim CFO, which I took over a good month ago. I have to say during my almost 30 years at Evonik and in my different roles, I've joined quite some meetings, events, investor presentations, presentations, discussions with customers, suppliers, and partners. Nevertheless, This earnings call marks a first for me. And unfortunately, we have to report a weak quarter three for Ebonic. However, I spent most of my time in my new role already on the future. Let me therefore comment on the fourth quarter in two parts. I would like to start with the supporting factors for our earnings development. And then I would like to comment also on our free cash flow and networking capital expectations. Starting with the EBITDA, there are several supporting factors in Q4. We will see the typical year-end recognition of sales and earnings in our healthcare segment, which will be more pronounced this year versus a weaker last year. In animal nutrition, we will see a pickup in sales coming from the low levels in Q3, especially compared to previous year. And these low levels were, of course, impacted by a planned maintenance shutdown. In Q4, almost full capacity will be available again, and we have already rather good visibility on the booking levels today. Another aspect to address are lower personal costs. For several quarters, we are seeing a reduction in our FTE numbers, which will come through more and more into the bottom line. In addition, bonus provision releases are further supporting our earnings and also in the upcoming quarter. So all in all, with the environment that will stay tough, the finish until the end of the year will also certainly not be easy. there are good reasons why we are confident to deliver around 1.9 billion euros of EBITDA this year. The same is true for the free cash flow. We are on track to deliver our guidance, which we gave as between 30 and 40% cash conversion. In the first six months of the year, the weaker than expected environment has made it difficult for us to reduce the net working capital as intended. Now we have adapted to the new situation, which has resulted in a positive free cash flow of around 300 million in Q3. And we have seen an acceleration in net working capital reductions throughout the quarter, making most progress in September. This makes us optimistic for further significant steps in quarter four to reach the midpoint of our guidance range. We will need another 380 million euros of free cash flow in Q4. Again, as with the EBITDA, it will not be easy, but looking into the past years, it is doable, and that's what we are going to do. And with that, I hand back to Christian.