Verbio Se

Good afternoon, ladies and gentlemen, and welcome to today's earnings call of Verbio following the publication of the half-year figures of 2023-2024. The CEO, Klaus Lauter, and the CFO, Olaf Trüber, will speak in a moment and guide us through the presentation and the results. And as always, we will move on to our Q&A session afterwards. So with this, yeah, let's jump straight into the presentation, Mr. Sauter. The stage is yours.

Thank you very much, Mrs. Malog. Good afternoon, ladies and gentlemen. Good afternoon, everybody. And welcome to our earnings call for the first half-year results from Verbio SE. I'm here with Olaf Dröber, our CFO. And we will cover our first half year and the Q2 of our running fiscal year 2023-2024. As always, we will also give you an update on what is new and what moves us forward for the rest of the business year. So let me start an overview of our key figures in the first half. First, we are pleased that we were able to continue to deliver strong production volumes, especially in Europe. This shows that our processes are running smoothly and stable. Thanks to our technology we can operate all year round, setting us apart from competitors, especially in the biodiesel and HVO space. The bioethanol volume increase was mainly driven by the acquisition of South Bend Ethanol in Indiana. Despite the increase in volumes, Group Abitda for the first half reached close to 75 million down year on year from 170 million. The main reasons therefore are in the first half of last year we still benefited from exceptional contribution of the biodiesel segment. We made more than 90 million in the first quarter alone with our biodiesel, which was, of course, very beneficial cash-wise. But the flip side is that these are tough comparables that we have to compare ourselves to. Meanwhile, we are setting up for further growth, which led to 20 to 30 million additional fixed costs year on year, in the first six months alone, considering that our European operations still have to cover all the growth investments, mainly in the United States, and that we are facing short-term headwinds in the European biofuel market. The results are solid in my view. Net Depth came in at 14 million investments in growth projects of close to 100 million weight against our positive operating cash flow. Still, our equity ratio continues to be stable on a high level at 69.3%. Let me hand over now to Olaf for the detailed segments result. Olaf, go ahead, please.

Thank you, Klaus, and a warm welcome also from my end. Now let's look at the Q2 results in more detail. The chart shows the EBITDA bridge from Q2-22-23 to Q2-23-24, left to right. What stands out most is that the biodiesel segment has protected our earnings for all shown quarters here, including Q1-23-24. In the quarters that are not pictured, dynamics look quite the opposite, underpinning the beauty of our diverse product portfolio, as mentioned before. Overall, we posted an EBITDA of €26 million in Q2-23-24, down from Euro 49 million in Q2 last year and sequentially. But let us dive a bit deeper and look at the key drivers. While we managed to grow our production year on year, sales came down by 30% year on year. The main reason for the sales development in the biodiesel segment were the lower biodiesel prices in Europe compared to the same quarter of the previous year. The price decline year on year was caused not only by lower feedstock prices, but also by allegedly incorrect declared biodiesel and HVO imports from China. Our EBITDA came in at approximately Euro 29 million. The attractive but still overall lower absolute product margin due to slightly lower sales volumes year on year was additionally burdened by the low clean house gas quota prices. Market spreads in that respect, biodiesel prices per ton minus rape seed oil prices per ton are below previous year spreads. Decline in biodiesel prices linked to a generally lower energy complex, mainly on the back of the overall lower economic activity and lower feedstock prices as you see here from the chart. bioethanol biomethane segment. Now let's move to the ethanol and RNG or together the bioethanol segment. Volumes increased mainly thanks to the acquisition of South Bend Ethanol in May last year, but also further efficiency improvements here in Europe. With this revenues are up despite lower ethanol sales prices in Europe. Product margins increased year on year thanks to lower grain purchase prices. Improved margins could not be fully compensated for the burden of startup costs for workers growth projects in the United States and adjustments in the valuation of inventories due to lower greenhouse gas quota prices. Spreads improved year on year due to more favorable grain prices. Average ethanol prices were below prices in the previous year. Decline in bioethanol prices throughout the quarter was linked to larger than expected imports of bioethanol recently, especially from Brazil. These volumes led to an increase in stocks in Rotterdam. The result is a price drop of around 30%. Fossil crude oil and fossil products are currently too cheap to increase consumption of ethanol at gas stations in Brazil. Geopolitical tensions in the Middle East remain a significant risk factor for global oil supplies. Nevertheless, the effect on oil prices formation has so far been very limited. What is positive for the pricing? The production capacity for bioethanol is already being withdrawn from the market in Europe. Some of the production capacity. Nevertheless, the low greenhouse gas quota prices are slowing the recovery of bioethanol prices. Why? Because there is no need for oil majors to exploit the maximum plant walls for liquid biofuels, that means for biodiesel and bioethanol. Klaus, I hand over to you.