Imerys Sa Ord

Good day and thank you for standing by. Welcome to the IMMERYS half year 2026 results. At this time all participants are in a listen only mode. After the speaker's presentation there will be a question and answer session. To ask a question during the session you will need to press star 1 and 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question you can press star 1 and 1 again. Please be advised, today's conference is being recorded. I would now like to hand the conference over to your speakers today, Alessandro Dazza, Chief Executive Officer, and Pierre Lebreuil, Chief Financial Officer. Please go ahead.

Thank you, and good evening to all of you. Thank you for joining us, as usual, to review Imerys H1 2026 results. Next to me, Pierre Lebreuil, our CFO. Let me start by giving you some highlights of the first semester of 2026. Strong Q2, which led to a very solid first half performance with higher sales, higher volumes, firm pricing, costs under control, and consequently, a material expansion of EBITDA and EBITDA margins. Second quarter results further accelerated the positive momentum which we presented already at the end of Q1. We can be, I would say, proud given the current general environment around us. So revenue, to go a bit more in detail, revenue was above 1.7 billion euros, up 1.8% versus last year at constant FX. driven by volume growth and firm pricing. Sales volume were up 0.5%, reflecting the contribution of recent capacity expansions and the strong performance of our commercial teams, offsetting the impact of some subdued demands in certain markets, weakness in Europe, and a little bit the Middle East following the conflict. Specific at the Middle East, limited impact. You might recall in April, we mentioned that we had almost no sales in the area or from the area. In March, situation has improved with, I would say overall, more limited impact than expected on revenues for the group. Fundamentally, the group, together with our local partners, we found alternative routes to import or exports to and from the region. Pricing remained firm, increased in average 1% versus prior year. You remember it was significantly lower in Q1, so a step up in Q2. Foreign exchange rates had an average impact of 2.7% on sales. It's almost 50 million, mainly relating to the US dollar depreciation, and it was Fundamentally concentrated in the first quarter of the year. Adjusted EBITDA for the period amounted to 290 million, up 10% at constant FX, driven by higher sales volumes, price increases, good, strict cost management, and improved contribution from joint venture. It's important to highlight, as we will see a bit later on, that at constant exchange rates, all our businesses improved the profitability in H126 versus H125. Strategic roadmap progressing well. Project Horizon is on track. And I have a specific slide right after on the topic. Two bolt-on acquisitions, they were announced before we closed. The first one, Great Lakes in the US, it will increase our presence in this very dynamic market. Closed on the 1st of June, so for the one month of little, let's say, contribution to our perimeter. The second one in Brazil, SB Mineração, closed on the 1st of July. Calcium carbonates for the local market, we will see the effects in H2 26. Last, but just as important, EON of Belgium and Imerys Graphite and Carbon in Belgium inaugurated a state-of-the-art energy recovery plant at Imerys production site in Wilbreuq, in Belgium, where we produce our carbon black for batteries on July 2nd, so recently, and this will significantly reduce the group CO2 footprint. And we will use exhaust gases to produce electricity for the equivalent of 40,000 A slide here to give you an update on the Horizon Project, our performance improvement program launched or announced late in October. In a nutshell, I think it's important to note this program, which aims at really reaching our target profitability and especially strengthen our competitive position, is on track. All activities are on time. Social processes are launched and progressing as planned. Our targets of the reaching 50 to 60 million euro annual run rate savings versus our 2025 cost base already step up. 70 million have been achieved by the end of June. I would say well balanced between fixed cost and overheads. This confirms what we said before that the group is on track to realize over 50 percent of the expected benefits in 2026 already with the full run rate impact expected to be achieved in 2027 onwards. On June 30 a provision of 30 million have been booked as restructuring costs for the For the industrial footprints ongoing, what is called right sizing of production capacity is being implemented, has been announced where needed, when needed, and I would say specifically in Europe, but not only. Common ERP systems worldwide is now almost finalized. We have more than 85, almost 90% of all of Imerys under one ERP. Massive effort over five years. These will also have help accelerate AI implementation, share services, and certainly fuel productivity gains. Let's take a look at our main underlying end markets and the trends during the second quarter. I would say construction activity, I would say a bit subdue all geographies, Excluding, of course, infrastructure and data centers. But, you know, Imerys is less exposed to this specific sector of the construction market. Maybe a bit better in Europe. Definitely remains very soft since several quarters in the U.S. We know the need of housing. So for me, it's a matter of time before this market returns to a healthy growth. Consumer goods, no issue. Resilient in all geographies. So far, automotive was down, lower production levels, basically no geographies. China was holding the world up recently. Even China had a drop in Q2. Maybe on the positive side, production of electric vehicles continues on a strong path, and you will see in more details later on the good impact on Emery's business, especially around our solution for energy transition business. Finally, general industrial activity typically follows the overall economy, so a BIT soft in Europe is holding better and even improving in the US, and especially for Imerys, very robust in Asia and in China. So if you look at BIT's sales performance by geography in the first half of the year, Asia, you see on the right, very strong, even stronger than Q1, which was good. Growth in all businesses certainly with a specific excellence in conductive additives. China performing very well is becoming one of the most important markets for the group with good sales, good profitability, and good growth.

Europe still negative in Q1.