K+S Aktiengesellschaft

Welcome to the KMS first quarter 2026 earnings call. I will now hand over to Julia from KMS for some technical notes.

Ladies and gentlemen, also from my side, welcome to our call. We hope you've had a chance to review our posted slides as well as our Q1 documents available on the website. After the opening remarks by Christian, we will jump directly into the Q&A session. Some technical notes. please refer to our disclaimer on page 2 of the presentation. A note on data privacy. Please be aware that the team session will be recorded, webcast, and available as an audio replay on our homepage afterwards. People who ask the question in the team session should be clear that by switching on their camera and microphone, they agree to the recording and replay of video and audio sequences. Now, I'd like to hand over to Christian Meyer, our CEO, for the opening remarks.

Thank you, Julia, and welcome from my side as well. We have published the key figures for the quarter in our 2026 outlook already on the 22nd of April, so I will keep this brief. Starting with the quarter, Q1 every day was almost 40% above the prior year quarter at nearly 280 million euros. Firstly, this was due to the successful de-icing sort business because of the strong winter weather. Following the strong start at the beginning of the year, performance continued to exceed expectations in the second half of the quarter. Secondly, in the agriculture customer segment, sales volumes and the average prices exceeded expectations, particularly in March. Free cash flow reached 87 million euros, cash capex 126 million euros. Let's look at our full year guidance. We raised our 2026 EBITDA forecast to range from 630 to 730 million euros from 600 to 700 million euros before. This is due to a strong performance in the first quarter and the positive price trend that has continued in the agricultural customer segment over the past few weeks. It is also driven by the revised US dollar, exchange rate assumption of 1.17 instead of 1.20 for the remainder of the year. However, the rising prices of materials, energy, and freight residing from the conflict in the Middle East since March are having a negative impact compared to the original assumptions. The midpoint. The midpoint of the ABTA range assumes current market price levels for gas and logistics. stable potash prices in Brazil, persistent positive spillover effects on other sales markets and product groups of K plus S. Additionally, it assumes that the increase in Cypher prices will continue to benefit the price of K plus S Cypher specialty products. The price level achieved for the product portfolio in the agriculture customer segment by mid-year would then roughly need to be maintained on average in the second half of If the prices continue to rise overseas with corresponding persistent spillover effects, the upper end of the range could be achieved. This could, for example, happen if potassium is given greater weight in compound fertilizers, thereby increasing demand. The lower end of the earnings range could be realized if the conflict in the Middle East persisted for a longer period. Thereby, it could either limit the availability of nitrogen and phosphorus fertilizers or the earning situations of the farmers and therefore potash application. This could reduce sales prices and volumes over the course of the second half of the year. Overall, the effects related to the conflict in the Middle East continue to be of limited predictability. I would like to give you a feeling for the paving of figures for the rest of the year. Keep in mind that Q1 and Q4 are our strongest quarters due to seasonality in both business segments. As a maintenance quarter, Q3 typically has the weakest EBITDA contribution. Q2 is normally better than Q3, but significantly below Q1 or Q4 levels. Last year, Q2 saw a seasonal drop in EBITDA of €90 million versus Q1. This year, the gap between the first two quarters is expected to be even bigger because of the extraordinary de-icing business in Q1 and the higher cost for energy and logistics. After this brief introduction, I am now looking forward to answering your questions together with my colleagues Jens and Julia, With this, I now hand over to the operator to start the Q&A session.