Virbac Sa Unsp/Adr

Good afternoon to all and welcome to the VRBAC 2024 Annual Results Webcast. We are very pleased to have you join us. Today's call is hosted by myself, I'm Sandrine Brunel, Head of Corporate Communications at VRBAC, and the presentation will be given by Abib Hamdani, our Interim Chief Executive Officer. Before we begin, I remind you that the slides... and additional financial materials presented today are available in the investor section of our corporate website, and the replay of the meeting will be available at the conclusion of the meeting. You can submit your question using the chat feature located in the bottom right-hand corner of your screen if you are interested. far away, not with us in the room. We will answer all the questions during the question and answer session or follow up afterwards if we run out of time. It's now my pleasure to turn the floor to Abib Hamadani.

Thank you Sandrine and good morning, good afternoon and good evening to all of you. This is my pleasure to present you the 2024 results, which will be the first part of this presentation. I will then move to a few slides to provide some perspectives as well as a view on what we are delivering as part of our vision 2030. And I will end up this presentation with one slide to share with you the guidance, what we expect for 2025. So let's start with our full year financials, a couple of slides to give you a summary, and then I'll go a little bit more into the details on the different components of our financial results. So a great year. 2024, we have delivered 13.6% of revenue growth at constant exchange rates. What is remarkable is the way it has been done. You remember that we are working on two different engines in order to fuel the growth of the company. The first one is organic growth, and the second one is acquisition growth. And you see that in 2024, we have delivered half of the growth on organic and the other half has been made through the strategic contribution of our acquisitions. So fully aligned with what we try to achieve on a yearly basis. The organic growth has been quite solid, 7.5%, which reflect as well a very good momentum of many of our products, including our key product, and that is another remarkable point of what we have achieved. A good portion of the growth is coming from our strategic product, the key product within our portfolio, namely the vaccines, the pet food, some pet care products, some specialty products. I'll go into more details in the following slide. And it has been done as well in a context of a favourable markets, dynamics, you'll see that 2024 has been quite dynamic in terms of the markets. Final comments on the top line is the solid performance in all geographies. We have been able to deliver growth everywhere with the exception of Australia, Pacific region, and I'll come back to that later on with a little bit more details. So this very positive increase on our top line translated, as you can see, into a nice growth of our EBIT adjusted, which reached a historical high 16.6% of EBIT adjusted margin, or 16% at constant scope without the impact of the acquisition. And this growth has been essentially driven by a gross margin improvement. This line has improved by 1.7 points at constant exchange rate, which is a combination of obviously the volume increase, but also a favorable product mix, as well as pricing. And you see on the other side of the slide that we've been able to increase price at around 3% in 2024. Obviously, this is an average, and we have a variance that is quite important depending on the product line. We have continued to invest in our operating expense at a concentration rate increased by 14%. It's driven by personal costs, obviously the impact of inflation. The personal costs are based, the increase of the personal costs in 2024 are based on the inflation of 2023. There is always a lag time, so this has weighted in. on our expenses and also the good years that we have done with a net result that is significantly above our initial guidance and the budget as well has generated some additional personal costs. And external costs as well with travel. I remind all of you that 2023 was a particular year with the pandemic. cyber attack that we suffer. So we had a sort of a base effect and rebound on travel. Marketing also to continue to invest on our project and some special projects. We had some one-off costs on legal that is a bit higher than what we typically had in the past. We have continued to invest heavily in R&D, 11% growth. We have now invested for increased R&D expense as a ratio to sales for several years. It has nonetheless remained stable at around 8% in 2024, essentially linked to the dynamic top line that we had. And finally, and I'll come back to that, M&A has been accretive on profitability in 2024, as you can see on the top of the slides. Let's move briefly on the exchange rate. You see the unfavorable impact, essentially in Asia Pacific and Latin America, minus 19 million euros of top line linked to exchange rate. This is, however, compensated by the fact that we have also significant cost base in local currency in many geographies. So we've been able to offset part of that impact. And the impact on EBITDA has been limited to around 5 million euros. The impact on the EBITDA ratio has been as well quite limited at 0.2 points. Let's continue to move on net results. We have increased our net result moving from 121 to 145 points. million euro this is a significant increase the financial result has remained stable at 9.3 million euro in line with the previous year we've had a higher cost of debt but compensated by a lower exchange rate impact and we have had also this year an improvement of our effective tax rates moving from around 27 28 that we typically had in the in the past years to around 25 And this is essentially driven by a country mix effect. The contribution of some geographies has been less as a percentage, and countries where the effective tax rate is higher, namely, for instance, Australia. Let's look at the cash. We're moving from a negative net cash situation, where cash positive at the end of 2023, if you remember, minus 50 million euros, around minus 50 million euros. And we move to a positive net debt situation, which is around 168 million euros. So this is essentially due to this evolution to the acquisition that we made in 2024. the acquisition of Sasaea, the Japanese entity, as well as the minority shareholders acquisition of Globion. You remember we've done that in two steps, one step in 2023, the second step in 2024. So we spent around 300 million euros for the acquisition in 2024. And the good news is that it has been partially offset already by a strong cash generation at Constant Scope. We have delivered around 90 million euros of cash generation Outside of the of the acquisition. So very solid year in terms of cash generation. Our net debt on EBITDA ratio remain quite favorable. 0.6% 0.6. It was obviously negative at the end of December 2023. So 0.6 gives us some room for maneuver, obviously, to continue our M&A journey. And this remains, and I'll cover that later on, the key priority for us as we move forward. And finally, we have renegotiated, as you know, our syndicated loan facility with an amount available at 450 million euros. And we've drawn 190 million euros at the end of December 2024. So this is for the big picture. I suggest I move on on the top line to give some colors on what we have achieved in 2024. So very briefly, as a reminder, half of the growth, again, coming from organic growth. The other half coming from M&A and the negative impact of the exchange rate. A quick comment on the markets. So we have done that in a dynamic market. As you can see, we have the figures for the end of September 2024 on a 12-month holding basis. The market has been dynamic, 7.4% growth, which is above what we expected at the beginning of the year. What is also important to mention is that the most significant part of of this growth is coming from the new molecules, the isoxazoline, as well as the monoclonal antibodies. We are absent from this market, so we've been able, in terms of performance, to deliver a performance in line with the market without, obviously, those product lines that have contributed to the majority of the growth. So with our own arms, With our own product, our own focus, we've been able, again, to deliver a performance in line with the market. And it's also worth to mention that these market figures are without pet food line, which is obviously one of our key driver for growth within VRBank. So with pet food, we would be above that and above the market. If we look at the sales evolution by region, you see Europe and North America delivering 10% growth. Going to go a little bit more into the details, but a very impressive performance. Expected for US, less expected for Europe. It's been extremely, extremely solid. The market has been dynamic as well. And you'll see that all of our affiliates have grown and some of them have even delivered double digits growth, very solid double-digit growth in Europe, so an excellent performance in Europe in 2024. Rest of the world, 16.3%. This is including the impact of SASEA, nine months of sales of the Japanese acquisition. We are obviously below that without Sasaya, 6%, 7%. And this is also including the negative, the decrease of our sales in Australia. So outside of Australia, we've been able to deliver a very solid performance. And I wanted to go a little bit more into the details and provide some insight on some of our key countries, some countries that have performed very well, and Australia that I had a more difficult year. So on the top left of the slide, you see U.S., a very good performance, very solid performance, 10% growth. double-digit performance also on our extended cell, the cells outside of the cells of the clinics, vet clinics. The growth drivers have been our key products, the ones that are targeted as strategic with dental, the dermatology product line, the specialty as well with Movoflex, Utazol, Zoletil, that have performed very well during this year. And looking forward to our 2025, we expect the same trend next year, backed by all of the effort that we are doing by some new product launches. We had some new product that has been launched in the US, Eradia, a parasitic site, for instance, that is doing quite well. We will have some new product launches as well next year with some specialty products, one of them being Ursolix, which is a very nice opportunity that we have in the US, so we will continue that journey of growth in that geography. A couple of words on Europe. With two countries, UK and Germany, we have several countries that have posted a double-digit growth. Among them, UK, 19% at concentrate. We've been able to claim the fifth position in the local UK market, which is quite a performance. We've grown across a number of segments, companion animal vaccines, parasiticides, supralurin as well. And no doubt that we will continue to capture growth with that product in many markets, but including UK. Dermatology, hygiene also, our pet care product, our are doing well, and we expect, looking forward, to continue to grow in our CA vaccines for production, and we have also the launch of Trilotab, which will continue to contribute next year. Another extremely solid performance is Germany, 11% constant rate growth, The market has been very favorable, but the team locally have been able to adapt to that and to capture and seize the opportunities in the German market and grow significantly. And here as well, you can see that the growth has been driven by the products that are targeted. And our key products, you know, Soprilerin, again, HPM, our pet food, that is doing quite well in Germany, growing year after year. Cortotic as well, if you remember, this is an alternative to antibiotics, here to treat ear infection. Isotic and farm animals, we've been able to continue to grow with Rilexin. And we have also launched some new vaccines for swine and cattle. So a very solid year. We expect further growth next year with Germany, not with the same magnitude at 11%. It will go back to a more normal rate of growth at 4% to 5%, which is, again, quite solid for Europe. So a lot of very impressive performance. Italy has grown double digit, France 6%. So it was a very, very good year for Europe. And one of the drivers, obviously, and I'll come back to that, was the vaccines rebound. We've been able to get rid of some of the bottleneck production difficulties that we had with our vaccine production line for dogs and cats. And we have produced and released much more volume, which enabled us to continue to grow and regain some of the growth after a difficult 2023 year. Australia, a more difficult year, as you can see, for Australia, minus 9%. We were not used with that in Australia, especially with the last three years prior to 2024, where we have enjoyed very nice growth. We are growing above the market in Australia, capturing shares. We have had some product launches as well during those years. And in 2024, it has been more difficult. The market has been declining, so the main reason is linked to the market, as you can see, minus 13%, essentially due to the unfavorable weather patterns, climatic situation with a lot of drought in some of the key regions for the farmers, so a difficult year for the farmers and as a consequence for also our industry. Looking forward, we see some positive early signs for a possible rebound with cattle prices that are in a positive evolution, late 2024 and early 2025. But it will really depend on the rainfall, especially in autumn. above average rainfall will be required to be able to lift the market and regain some growth there. So let's continue on our geographical coverage. On the top of this slide, North America, Europe, I've already commented. On the very bottom, Pacific, I've commented. Let me focus briefly on the Right side of the slide with Far East Asia, you see 80% growth. This is essentially linked to the Sasaya acquisition. But outside of the impact of the acquisitions, we are very, very satisfied with the performance in China. You remember 2023 was quite difficult. We have rebounded very well, 11% growth in China. Across here as well, the key product line, the pet care, we have launched a pet food. We've done half a million. So it's an interesting start for that product ranges. We have some specialty product as well, anesthetic, that have done quite well. So all of the efforts start to pay off in China after a difficult, again, 2023. And this has been made in the context of a declining market in China overall. So we've been able to grow in a declining market. Some other countries have done also very well. Vietnam, Thailand, South Korea, some of them have grown double digits as well. Let me move to the other side of the slide with Latin America, 7.4%. Two countries are driving that growth. Mexico, very nice growth in Mexico, double-digit growth across the board on companion animal and farm animals doing very well. And the other one is Chile that has rebounded quite well, essentially linked to a a very high demand for one of our parasiticides in the context of an SRS epidemic. Brazil, I shared with you at the end of June that the first semester was more difficult, but we have rebounded quite well in Brazil. We ended up with 3% growth in that country. Some of it linked to a the low cycle for the ruminant activities for the farmers in the reproduction. Some of it linked as well to the limitation of production capacity in Uruguay. We are exporting from Uruguay to Brazil some of our vaccines. So we are very confident that we'll be able to deliver a much better year in 2025. And finally, India, Middle East and Africa, 15% growth. So here as well, a very solid growth. Part of that is linked to the Globion acquisition, obviously. We've added around 12 million euros with Globion. And the rest is linked to essentially a very good performance in India, outside of Globion, where we continue to enjoy growth in that country, around 5% to 6%. So let me move... With some colors by segment, very briefly, the split between companion animal and farm animals remain the same, more or less the same, 59%, 60%, 60, 40. What is noticeable, nonetheless, is within farm animals, you see the increase in terms of weight of the poultry and the swine, poultry linked to Globion, obviously, and swine linked to the development of our swine vaccines product line. with some internally developed vaccines that we have launched, the PCV2 in particular, that is continuing to grow, and also some in-license product that we have added to complement our portfolio in some geographies. If we go down a little bit more into the details within the companion animals and we look at the sales, the growth by segment, you see all green. So we are growing on all the segments. Again, a very solid year in 2024. Some of them double digits, namely specialties with the contribution of, again, non-products such as Zoletil, Supralorin, MovoFlex. The pet food continues to grow quite well, 12%. We have reached 130 million euros of sales with our pet food product line. Parasiticides, no, sorry, antibiotics, dermatology, 13.1%. Dermatology is one of our key product line within our pet care franchise. And the vaccine, you see the highest growth coming from that product line 29% increase. We have reached the 100 million euro sales with our vaccines line, and this is essentially linked to, obviously, the increased production capacity at our French dog and cat vaccines manufacturing sites. Farm animals, 2.4%. A little bit more contrasted picture here, as you can see. We have some segments that are decreasing. It's essentially linked to what happened in Australia. Australia weighted and impacted the parasiticides product range and explained the decrease. Nutritionals as well, you see only 1.2%. We are used to a higher growth on that product line. It's also injectable micronutrition is one of the key product lines we are targeted internally. And this limited growth is essentially linked again to the impact of the Australian markets. Vaccines and aquaculture have driven the growth with antibiotics as well, 3.6%. But in terms of top-line growth rate vaccines, 6.4 percent with a very good year and aquaculture as well the rebound that i commented earlier on very briefly now if we cross region and segment you see the arrows pointing at the top of the slide so indicating growth there is only one which is pointing downward it's the uh farm animal for other developed countries. And it's linked, obviously, to what happened in Australia in 2024. So very solid, excellent performance on the top line, which translated nicely into the bottom line. You see, and I've commented already on the evolution of our current operating profit before depreciation of assets arising from acquisitions. moving from 15.1% to 16.6%. So this is a nice growth above what we expected at the beginning of the year, and it's driven to a large part by the improvement on the growth margin. Maybe a quick comment on a line that I've not commented in the summary, which is the other non-current income and expenses. You see €10 million expense. To be compared to only 1 million euros last year, this is linked to some expenses linked associated with the acquisition of SASEA, some due diligence fees, banking transactions as well, linked to the bridge that we have implemented, some lawyer fees. And that's why it's considered as non-current, non-recurring, and it's part of that line. We have also included there a little bit more than 2 million for restructuring costs in the context of the closure of a manufacturing site that we anticipate in Australia as we move the production in France. The net financial expenses, you see it's more or less stable, moving from 9.8 million euros to 9.3 million euros. It's a combination of an increase of net cost of debt, as well as a decrease of the exchange rate negative impact versus last year. Income tax increase recorded in our profit and loss statement increase in line with the net result increase. And the combination of all of that enabled us to deliver 145 million euros of net results. A quick word on the EBIT adjusted evolution just to illustrate where it's coming from. You see Europe, North America and the rest of the world that have contributed quite nicely to the improvement of the EBIT adjusted. Europe is having the lion's share of that, and it's linked to the very dynamic top line that we had. Obviously, when we increased the top line in Europe, we have a nice translation of that into a bottom line. A lot of our commercial infrastructure is sort of a fixed cost, so it had a nice impact overall. We continue to be in an investment phase in North America, but still we've been able to deliver 8 million euros more EBIT adjusted. We continue to increase our profitability in the U.S., even if it's still below the group average. But here as well, the top line is also translated nicely into the bottom line as we have also sort of a fixed cost, not only on the commercial part, but also on the industrial side in St. Louis. We have continued to invest in RDL, as you can see, and also in some of corporate expenses to fuel the growth of the group. So RDL to prepare the future. I'll come back to that. But the ratio, again, has remained stable at 8%. And we have also some increased expenses at corporate, include as well some industrial costs that have been accounted here, there. And we have also some more of a one-off type of expenses linked to some of the projects that we have, and some slightly increased legal costs versus what we typically had in the last two years. Cash flow evolution, a good year as well on that front. We've increased by 20%, both our operating cash flow and net cash flow, and we're approaching the 300 million euro landmark for EBITDA generation on a yearly basis and this net cash flow has translated nicely into free cash flow as you can see we have increased our level of capex investment and that was expected moving from 60 million euro to 80 million euro it's even slightly lower than what we expected at the very beginning of the of the year and And the good news is on the working capital requirements. We had it weighted last year on 49 million euro needs, negative cash flow impact linked to the working capital. And you see this year only 6.6 million euro. It's essentially linked to the inventory evolution. We are working toward optimizing our inventory after the increase that we've seen during the COVID pandemic. and the supply chain crisis that we were all industries facing during several years. We are now more in a phase where we try to decrease that ratio gradually and optimize our working capital. So around 108 million euros of net free cash flow. And obviously, this net free cash flow enabled us to compensate part of the acquisition cost. I mentioned 300 million euros. You see we're at 309 million euros exactly in terms of spending for the acquisitions. So we ended up this last year, 2024, at 168 million euros of net debt. I will move very quickly on the condensed balance sheet. Nothing new. More to say, maybe just a quick comment on the net debt on operating cash flow. I mentioned it during when I commented the summary slide. We are at 0.6, so again, a very favorable position to be to continue to fuel the growth of the group and all of the projects that we have, namely within our industrial transformation. I will cover that in the next section. Shareholding structure has not materially changed. As you can see, the majority shareholders remain the Dick family with a little bit more than 50% of the shares and 66% of the voting rights. Let's move now to the second part of the presentation, strategy execution and some elements regarding the perspectives for Virbac for the coming years. So let me start by Spending some time on this slide, which it's been now several years that we commented, it's a very important one because it describes the vision, our 2030 vision, and the roadmap that we have towards realizing that vision by 2030. You can see that it has not materially changed year over year. We have very constant into what we are trying to achieve. We are obviously adjusting it whenever it's required, adjusting some of the projects whenever it is required, but fundamentally the compass remains the same and we are all delivering toward it on a yearly basis. So I'm going to comment it and then I will show you some of the progress that we have realized in 2024 to support that vision and to support that objective of 2030. So the financial target has remained the same. The one that we are contemplating is to reach 20% of EBIT adjusted in the horizon 2030. We remain very much committed and focused toward doing that. What has been achieved in 2024 and what we have shared and what I'm going again to share with you for 2025, position us very favorably to realize that ambition. We have several levers that we will actionate. Three of them are listed in that slide and are among the most important, the one where we allocate most of our resources. The first one is innovation. We are obviously in an industry where innovation plays key roles. We made the decision three years ago to increase our level of R&D investments to fuel what we consider to be a rich pipeline that we have, to prepare as well for some patents that will be finished in the horizon 2028, 2030. So it was a good time to invest and get ready for that. So we have delivered on that year after year. We have moved our investment from 6.5% to 8% as a ratio R&D to revenue. And we are tracking the progress very rigorously year after year. And I'm going to share a few elements on what has been achieved in 2024 on the next slide. Acquisition remains a priority for us. We are still extremely committed toward acquisition. We are, again, a very favorable balance sheet. We have a team that is in place at headquarter locally. We are also leveraging and having the support of all of our GM in all of the countries to scout, identify, and work with us. We are very busy on that front. I cannot obviously guarantee you need to be too, too dense, as we say in all of our presentation. But I can tell you that we are still extremely committed toward that and addressing that with a lot of energy. Competitiveness, third lever. You know that we are working year after year to control competition. our expenses with a very specific focus on the industrial parts. When we look at and benchmark our profitability versus our peers, we are still behind on the gross margin. So we are putting a significant emphasis on our gross margin through competitivity programs in all of our manufacturing sites. We are also engaged into a industrial transformation with a significant CAPEX investment. We anticipate to spend more than 100 million euros for several years to fuel that transformation and that vision. And we have several projects that are quite important. And on the next slide, I will give some updates on a few of them. And obviously, each of those CAPEX projects is an opportunity for us to look, search very actively on productivity in the way we are making our product available, in the way we are producing them. Just below that, below those three levers, you have where to play, what we qualify as where to play in the cube, which is our market. You remember and you know geography, species, segment, three-dimensioned. So our ambition is to continue to strengthen on the geography dimension, our position in all of the countries where we are present. But we have a specific focus in two countries, US and China. Those are the two major markets. In those countries, we have a market share that is below the average average. So we are fueling those countries through R&D, through commercial investment as well. We have engaged over the last few years and we have shared that in the past with a significant number of R&D projects for China, for instance, to complement our portfolio. And we will continue that over the next years. I will be more brief on species and segments. We had the opportunity to comment on that on numerous occasions, but we have from a species segment, two backbones, the pillars of the company, companion animal and ruminants, want to be present in all the key markets with the largest offer as possible to offer to our customers on those two segments. segments. And then aquaculture and swine, where we call that venture. We are trying to establish our position with a long-term vision to build the right portfolio. And to encapsulate all of that, I'd like to finish by the top of the slide, which is the most important asset that we have internally, our team's They have demonstrated on numerous occasions a level of engagement that is quite unique, that is anchored into the culture of the company, a culture of trust, a culture of freedom, a culture of entrepreneurial spirit as well. We want to nurture that. We want to maintain that. We want to continue to keep and to build, to improve, create a great place, environment for all of our employees. So we've been engaged into the Great Place to Work polls. And I will share that in the next slide. We had some nice results in 2024, which is very encouraging for us to continue on that journey. We have also a very long-term focus. We want to create a sustainable future for Virbac. And as such, we have also ambitious plans. objectives within ESG that we are communicating on a regular basis and we are committing on many different dimensions within ESG. And finally, process. The main transformation there is through digital and we have also, and it's a good transition with the next slide, we have also achieved a very important milestone for us on that dimension in 2024. So illustration of some of the progresses, some of the successes that we had in 2024, more on the qualitative dimension after the financial performance. And those obviously are progresses that we are doing on a yearly basis to progress along the way to achieve our vision by 2030. Product launches, a nice year, two specialty products. You remember that specialty was targeted for us with MovoFlex. We had a fantastic performance with Movoflex Dog. We are implementing and launching Movoflex Cat. Trilotab as well, another specialty project. HPM, our pet food. We have registered a therapeutic pet food with new claims in 2024. We have also launched some new swine vaccines. uh the list could go on we had also a radia that i mentioned in the u.s a parasitic side that has done quite quite well and also not mentioned on that slide but still very important for us you remember it's part of the vision as well as a geo extension making our key products available in all of the geographies a good illustration of what we have realized again in 2024 is the Geoextension of Cortotic, the product that I mentioned, which is an alternative to antibiotics for the hair infection. We've been able to register that product in a couple of new geographies in 2024, and we have just finalized the registration for Japan, for instance, early 2025. So this was for 2024-2025. If we look further away, we've made some nice progress on our R&D projects. We are tracking the milestones for our portfolio, and we have achieved 90% of the milestone that we had at the beginning of the year. And I can mention as well that we have four ongoing approval process in EU. Industrial transformation, we have several projects significant and transformative project. We have initiated the building of our biology new site in Carros. We have made good progress in the administrative step to create the condition to be able to build our pet food facility in Nîmes in France. We have also acquired the land in Carros to be able to build our French logistic center. So that was also a nice progress that we have made, and we have continued to work quite extensively on our inventory management and productivity initiative. Acquisitions, I covered them. I'd like to speak more on that slide about something that is probably a little bit less visible, but still creates a nice value for us, which are the commercial in-licensing and the technology licensing. We have signed six commercial licensing deals. So it's a way to complement our portfolio in some geographies. So one example was the swine ruminant vaccine that we have launched in Europe and in some parts of Latin America as well. So we have some very strong partnership with some companies to fuel that. And we have also signed four technology licenses. So it's early phase. but it will fuel our R&D project as we move forward. I mentioned about the digital transformation. We are very, very proud of the deployment in France of three systems at the same time, ERP, new ERP, manufacturing execution system, and a laboratory information management system. all of them deployed at the same time. It was a huge project for us, a lot of sweat. Many employees mobilized, more than 100 employees, a lot of users that have been trained extensively. And we have pushed the button in June last year, and it's been a successful go-live with no interruption in production and delivery of our products. We are very, very happy and very proud of that. And we are continuing now the deployments of that digital transformation in all of our commercial and industrial side, but France was really the lion's share of it because it was the biggest entity that we had to cover. And last but not least, great place to work progress. We had the result in 2024 of our polls that has been done early 2024, and we have made some significant progress. So plus nine points on the trust index. So the efforts that we are doing are really paying off. We have now 14 subsidiaries that has been certified, which is an excellent result. And we are obviously continuing the journey. We have analyzed all of the results. We have a working group that are working as we speak in order to continue to implement initiatives that will help us to move even further than what we have achieved so far. M&A. I wanted to say a few words to update you on where we stand. It's been obviously a busy year in both last year and 2024. We hope it's going to be as busy in 2025. It's been a busy year in materializing some of those opportunities, namely SASEA and MOPSAN and and finalizing the Globion acquisition, and also obviously in integration. The first priority for all of us when we're doing an acquisition, it's obviously business continuity. And we've been very much focused on business continuity for those acquisitions during the early weeks, early months. And you can see at the bottom of the slide that it has done quite well. Globion has had a very nice performance. We are growing in terms of Globion sales. We moved from 12 million euros to 15 million euros. These sales are being made outside of Suguna. You remember Suguna was the company that divested Globion. We had a contract with them as part of the acquisition whereby they were guaranteeing us some volume and following the acquisition, but we've been able to grow outside of Suguna significantly. So the company has been integrated nicely into our Indian organization. You remember that we have more than 1,000 employees in India. It's a well-organized affiliate, and it's went very well. It's now fully integrated from a commercial standpoint, and we're able to benefit from the muscles of our organization today. to drive and develop Globion SEAS. SASA-EA, nice performance as well, in line with the historical performance, so no interruption or no issues with the business continuity. The integration process is going well as well. It's not an easy one, of course, with the barrier language. but we have a very nice team locally in place. We have combined the leadership of our previous, of our existing Virbac affiliates with the leadership of SASEA. We have now 100% clarified organization at all, which has been communicated and in place at all level of the Virbac Japan organization now. We have merged the commercial team. We have merged also the commercial policy. So from a business standpoint, everything is in place now, and we can move to the second phase, which is really looking at delivering even more value, leveraging the industrial footprint that Sasaya is offering, as well as potentially some synergies within the portfolio, and that will be the focus for 2025. Thank you. Mopsan. So this is the Turkish acquisition that we made. You remember, it's our main distributors. We knew them very well. We were working with them since 2018. So obviously, it's easier to combine the organization. The leadership is in place and the early results are quite encouraging. You see what we have achieved in only one month with our new Vierbach-Türke organization. So integration is going well according to plan. I wanted to cover the typical and usual portfolio slides that we share every year. So here you can see for companion animal and food producing animal year by year for the next four years. you can see the nature or the type of products in which segments that we are going to launch with an estimated pixels potential. So by convention, we consider the pixels after three years. Some of those products will continue to grow after three years, but we had obviously to take a convention. A couple of comments there. The first one is it has not materially changed when you compare to last year. On food producing, if you look at on a year-to-year basis, we had a little bit more in 2025, and it has been pushed to early 2026. So it's slightly less in 2025, and it's more in 2026. So that's the first comment. The second comment is we mentioned, you remember, the increased R&D. We add, obviously, every year one year. So you see 2028. You had not 2028 last year, obviously. And you see it start to increase. We start to have a higher number for 2028. So this is the benefit of the additional investment that we have done over the past three years. And we continue in 2029 and 2030, moving from around 40 million to around 70 million euros in that year. Okay. And maybe a last comment to cover 2025. You see it's a busy year. We will have some nice lunch. And I wanted to tease with one product that we are going to launch in 2025, which we are very proud because it's going to be a first of that kind in the world. We are going to launch the first medicalized pet food. which is registered. So it's going to be launched in 2025. It will target one of the main conditions for aging cats. And again, it's a combination of a pet food with a drug, a registered medicalized pet food. So I'm not going to say more, but stay tuned. You will see some communication later on on that project, which is a nice illustration of what we try to achieve combining pet food and our medical expertise. Let me finish with the guidance for next year, Outlook for 2025. So I'm going to repeat what we shared with you already in mid-January when we shared our guidance for next year. We expect a net revenue growth at content rates and scope between 4% to 6%. So this does not include the impact of SASEIA. We will have, obviously, an impact because we will consolidate SASEIA for 12 months versus nine months in 2024. So these three additional months will more or less add another one point of growth to this 2025 guidance. The EBITDA ratio to revenue will sort of stabilize at 16%. So in line with what we have delivered in 2024 at constant rates and scope. And I say stabilize, it's not exactly correct because actually it will improve. Because at the same time, as I mentioned, we are increasing. We expect to increase our R&D ratio by 0.3 points. So we will compensate for that 0.3 points. by operational improvement of our EBITDA before R&D. So we'll continue that journey to improve our profitability, but obviously it will be slightly less than what we have achieved in 2025, 2024, sorry. And we expect to have here a neutral impact of the SASE acquisition. You've seen that the impact was quite positive in 2024. So in 2025, we'll have some depreciation linked to the investment in the new manufacturing site in Sassara. You remember that they had a brand new biology plant there. So we start to have that impact kicking off, kicking on in 2025. So we expect to have a neutral impact from an EBITDA. The Sassara acquisition will still be very positive in terms of EBITDA contribution to the group. And finally, net debt evolution, a very solid net debt evolution expected at around 80 million euro. As I mentioned, we will have an increased capex next year versus what we have spent in 2024. We expect capex to be above 100 million euro. It was at 80 million euro. So 80 million euro in that context is a very solid cash flow generation that is expected for 2025. Not going to comment the financial calendar, but it's available. And I suggest we move to the Q&A session.

Thank you. Thank you very much, Abib. I have a lot of questions with the people who are listening to us. There are almost 50. I have perhaps 12 or 14 questions. But we shall start there. And then I will try to ask the questions that I have on my paper.