Symrise Ag Ord

Ladies and gentlemen, welcome to the Trading Update January-September 2024 conference call. I am George, the chorus call operator. I would like to remind you that all participants will be least anonymous 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 Dr. Jean-Yves Parizeau, CEO. Please go ahead.

Thank you very much. Good talk. Good morning, all of you, ladies and gentlemen. Welcome to our nine-month call this morning, and thank you all for joining Olaf and me. We wanted to use this occasion to give you a brief update on our nine-month number. which will give you an idea of our trading statements at this time. While we do not usually do these calls for our first or third quarter numbers, we decided with Olaf to make an exception this time because we wanted to concentrate on all your questions about these numbers. After my remarks, Olaf will give you an overview of our price, volume, and hyperinflation-related pricing performance. Then we'll open the floor for questions afterwards. Now, in first nine months, we're once again strong ones. No surprise there. Solid top line growth. We grouped sales up to 11.1% organically to 3.8 billion million at the end of September. For the third quarter, that comes out as a plus of 10.2%. SEMRISE also continues to perform strongly on the bottom line. Again, no surprise there. As usual, in our nine-month performance, we are not reporting detailed EBITDA numbers for the period, but let me assure you that we are not deviating from our profitable growth course. And most importantly, Our solid performance in the third quarter has led us to specify, you might even say elevate, our full year guidance. We now expect sales to come in at around 7%. As you have come to expect from us, both of our segments have once again performed well in the third quarter, and both contributed to the overall strong results. And that is, despite the overall economic development around the globe, we still see significant geopolitical tensions and a relatively high inflation in many of our markets. In that context, the nine-month performance I just talked about is a real testimony of the resilience and strength of our business model. I'm really proud of our diversified portfolio and our broad international footprint. which makes us definitely unique. Let me share with you, our international setup is really quite impressive. I just visited our major operations in Asia, Latin, and North America. And in the coming days, I will be in Madagascar and make a quick stopover in Dubai. I couldn't wait so much for meeting our teams. It has been very inspiring for me to meet so many SEMRisers around the world in the last few weeks. They are all doing such a great job. I am convinced that our setup will continue to drive our success going forward. As we said in our trading update this morning, we are firmly convinced that we have set the right course for the future. With that, let me hand over to Olaf. which will give you some more additional context and the numbers we have reported this morning. Before we then, we will take all your questions. Olaf, thank you.

Thank you, Jean-Yves, and also a warm welcome to everybody on the phone, also from my side here. Let me give you an overview of our price, volume, and hyperinflation-related performance. There's a special emphasis on the latter one. Our strong organic growth of 11.1% in the first nine months was primarily driven by volume. While we experienced a marginal decrease in real pricing, this was offset by a low single-digit positive impact of 2.3% from hyperinflation-related pricing, leading to an organic growth without this impact from hyperinflation of 8.8%. In Q3, we achieved 10.2 percent organic growth, which was driven again by volume. A slight negative price impact was offset by an equal positive impact from hyperinflation-related pricing of 0.3 percent, leading to an organic growth without hyperinflation of 9.9 percent, i.e., stronger than in the first half. TAFE's nutrition hulls delivered 10.4 percent organic year-to-date growth. Compared to the first half of the year, the volume performance accelerated in Q3, leading to an organic growth of 11.3% for the segment. Specifically, pet nutrition continued to experience certain price decreases in Q3, resulting in a slight negative price impact on the T and H segment performance. This was offset by a positive low single-digit hyperinflation impact. 0.6%. Scent and Care achieved 12.2% organic growth in the first nine months, with all three divisions experiencing double-digit volume increases. The segment was a slight real price decline driven by aroma molecules. This was partially offset by hyperinflation, 1.0%. Q3. delivered organic growth of 8.4% for Cent and Care, driven by a high single-digit increase in volume. Alongside a continuing slight price decline, we saw slight hyperinflationary headwinds in Q3 for Cent and Care. Based on the good business performance of the first nine months, we are specifying our full-year organic sales growth target to around 7%. So furthermore, please note that hyperinflation-related effects will cause a specific negative impact on our organic growth profile in Q4. Especially the Argentinian peso has been subject to continuous devaluation for several years, which escalated actually in December 2023 by monetary policy measures of the newly elected Argentinian government. and caused a severe devaluation of the peso from 393 to 893 Argentinian pesos per euro. During the first nine months of 2024, the difference between current and previous year FX rates led to the earlier mentioned positive contribution to the organic growth from hyperinflation countries of 2.3% for the first nine months. At the end of 2024, the sharply depreciated exchange rate of the peso from the previous year will flow into the growth calculation and impact the organic growth negatively in a substantial magnitude as headwind in Q4. This will also significantly reduce the growth contribution from hyperinflation countries for the full year before our capping. An opposite effect in the same magnitude will be reflected in the FX-related sales growth. From a reported sales growth perspective, this specific impact will be kind of neutral. So I wanted to highlight this. I'm sorry for being a bit technical here, but I think it's important for you to understand where we are. I hope you appreciate these additional comments to understand our growth guidance of around 7% for the full year in a better way. And with this, I would like to hand back to Jean-Yves for some final comments.