Thyssenkrupp AG

Hello and welcome to the interim report nine months 2022-2023 call. Throughout the call all participants will be in a listen-only mode and afterwards there will be a question and answer session. Please note this call is being recorded. Now I hand over to Klaus Ehrenberg, please begin your meeting.

Yes, thank you very much operator and hello everyone and a warm welcome also on behalf of the entire team. The conference call today will be hosted by our two board members here, typically available in our conference calls. It will be Klaus Keisberg, the CFO, and it will be our new CEO, Miguel Lopez, whom we welcome very cordially here in this session. All the documents for this call have been made available already early this morning. They are on the IR section of our website. And with that, I finish my housekeeping remarks and hand over to the two gentlemen. Miguel, please take over.

Thank you very much, Klaus. A warm welcome also from my side to today's Q3 conference call. Actually, my first conference call as CEO of Thurston Group since my start in June. After the recent listening roadshows when I got to meet some of our analysts and investors, it is very important for me to participate in this event as I would like to stay in close contact with you, the capital market going forward. That's why I would like to take this opportunity together with Klaus to highlight our management priorities and to classify the Q3 highlights and financials. For now, please let me start with my observations of ThyssenKrupp to date, as well as some capital market feedback that I have thankfully received within the last weeks. To make it short, ThyssenKrupp has a strong foundation that we can build on, but there are also clear challenges we need to tackle and that we are very well aware of. With regard to the strengths, ThyssenKrupp is a world famous brand with leading technology positions, a long standing customer base, and a highly motivated workforce. In my view, ThyssenKrupp definitely is an industrial icon as well as one of Germany's most recognized brands. As you all know, ThyssenKrupp is an enabler of the green transformation for several industries, a topic that is really gaining momentum and where we will take and enhance leading positions. On top of that, ThyssenKrupp nowadays is in a solid financial position, which founds the basis for transformation and provides flexibility to capture opportunities. On the other side, we have a complex portfolio with many moving parts in combination with slow execution in the past and a partial lack of transparency on segment level that makes financial modeling challenging for you. We have to overcome our cash generation legacy and close the gap to our financial targets. This impacted our shareholders as well because the returns we generated have not been sufficient enough. These observations bring me to the next page, our management priorities. The following topics are first on my and our management's agenda. Portfolio, performance, and green transformation. Please note that the details of an overall holistic concept for the group are in progress and thus are yet to come. We are working on this with full effort. For portfolio, we will continue to streamline and to de-risk the group. For instance, as current focus with regard to the evaluation of standalone options for steel Europe and marine systems, but also in terms of the exit of our non-strategic businesses at multi-tracks such as springs and stabilizers and automation engineering, and we will increase our efforts to speed up decision-making as well as execution. For performance, we are aiming for an overall step-up and a sustainable positive free cash flow before M&A. It is our mission to get there by continuing to leverage the strong USPs of our businesses, which are based on decades of experience and engineering know-how, and the corresponding rise in margins to benchmark levels, but also by improving our networking capital. This also means that we are doing hard work to turn surplus networking capital levels into cash. With such an enhanced performance, we will then be in the position to reward shareholders. And of course, this includes reliable dividend payments going forward as a clear target for us. With regard to the green transformation, I would like to start with Steel Europe. Here, we will continue to execute the TKH for steel strategy with our first DRI plant as the key element of our decarbonization journey. And we will capitalize on our enabling businesses with their leading green technology positions, which include, for example, our bearings business with their mission-critical components for the wind industry, Lucera as technology leader in industrial-scale hydrogen electrolysis plants, ammonia plants removed for the hydrogen economy and infrastructure, and also Polisius as a pathfinder for the cement industry to reduce carbon emissions by their carbon capture and usage technology named Oxifuel. With that having said, let us now take a look on our Q3 highlights. Overall, in Q3, we clearly delivered on our management priorities. Let us start with portfolio. Here, we managed the successful IPO of Thistle Group Nocera after an intense marketing process with the first day of trading at beginning of July. And please let me remind you, This has been one of the largest IPOs in Europe in 2023 so far with an initial market cap of around 2.5 billion euro and total proceeds of 605 million euro including the green show options. I can proudly say that this is quite a success story of which ThyssenKrupp will retain a stake of more than 50% going forward. Looking at performance, I'm happy to say that our Q3 financials are fully in line with our guidance, despite softening macro conditions, such as a reduced GDP growth assumption for Germany. Nonetheless, please note that our Q3 performance includes, as promised, a positive free cash flow before M&A And being more precise, a free cash flow before M&A came in at 347 million euro. Moreover, we are now in a position to confirm, and with regard to EBIT adjusted, even more specify our financial outlook for the fiscal year. And we also pushed ahead with our green transformation related activities, And let's start again with Steel Europe. We finally received the long awaited approval by the German government for the funding of a TKH4 steel decarbonization project of around 2 billion Euro. This not being just a milestone for us, it is also a very important contribution to achieving the climate targets in Germany and Europe. and it secures numerous jobs in the region. On top of that, we signed further MOUs for the supply of CO2-reduced steel with Mercedes-Benz and Pentala. This really is a strong proof point for us that our CO2-reduced products are well perceived by our customers and that there is a corresponding demand in the market. And let me also give some further examples. Nucera was able to sign another reservation agreement with a North American customer for electrolyzer production capacity in the high three-digit megawatt range for green hydrogen. And UDA announced a cooperation with BASF for our proprietary Anvinox technology the catalytic reduction of extremely climate harmful NOx emissions, and this will enable their customers to reduce greenhouse gas emissions even more effectively. And with that, I would now like to hand over to Klaus to give you more details on our Q3 financials. Klaus.