Vidrala Sa

Good morning to everyone and thank you for the time that you dedicate to attend this call. As announced, BIDRAL has published this morning its 2023 full year results, and additionally we have also published the results presentation that will be used as reporting material to this conference call. Following this document, we will dedicate the first part of our exposition to briefly explain the figures released today, to dedicate afterwards as much time as necessary to discuss on the business performance in the Q&A session. So, starting with the main magnitudes, in the full year 2023, we achieved as most relevant business figures, revenues above 1.5 billion euros, an EBITDA of almost 394 million euros, and a net income of that is equivalent to an EPS of 7.23 euros. Net debt at the end of the period stood at 472 million euros, which is equivalent to a leverage ratio of 1.1 times the pro forma EBITDA, which considers the contribution of the last 12 months of the report. Turning to slide four, we look at the top line performance analyzing the annual variation of revenue broken down by concepts to arrive at the reported figure of 1.559 million euros. As it is shown in the graph, this figure is the result of a 15.3% growth at constant currency and comparable scope. Volumes were down minus 7% in the full year, including the park contribution, while price-miss effect was up 22%. Hidroporto, fully consolidated since December 1st, 2023, contributed an additional 1.4%. Following the order of key business figures referred to at the beginning, we analyzed with exactly the same breakdown the variation of operating income. 2023 full-year EBITDA amounted to 393.7 million euros, reflecting a growth of 43.5% at constant accuracy and comparable scope. These operating figures resulted in an operating margin EBITDA over sales of 25.3%, which represents an expansion of more than 5 percentage points compared to 20.1% registered in the previous year, which was, as we all know, negatively affected by the extraordinary context derived from inflationary pressures and the energy prices. Let's analyze now the free cash flow generation in detail. We will do so with the help of the chart on slide 7, which reconstructs the cash conversion for the full year. So, starting from an EBITDA margin of 25.3%, we have dedicated 9.7% of sales to investments and another 5.7% to the aggregate of working capital, financials, and taxes. Free cash flow generation recovers the path of gradual normalization, reaching the equivalent of 9.8% of sales. Now, NetDev. at the end of the reported period, close at 472 million euros. This figure is mainly the consequence of the cash out for the acquisitions of the PARC and Hidroporto, including debt, on top of our firm commitment to shareholder remuneration and the just-mentioned cash generation. As a result, leverage ratio stands at 1.1 times pro forma EBITDA. And finally, in this slide, we present the distribution of sales and EBITDA by divisions, considering a 12-month contribution of the report. If we make the analysis under the new perimeter, after yesterday's announcement of the agreement to sell the Italian business, the new group would have generated, in 2023, revenue of 1.567 million euros and an EBITDA of 406 million euros. And now, before turning to the Q&A session, I pass the word to Raúl so that he can extract main conclusions or highlights and make additional comments that he considers appropriate.

Thank you, Inio, for the excellent presentation. And thank you all attending this call today. We know that you are quite busy. We really appreciate your time. Thank you. Well, we finally ended the year 2023 meeting the expectations expressed in our official guidance. But this doesn't mean that it was an easy year for us. Far beyond the numbers, in 2023 there were a number of strategic movements and operational actions to react to predicted business conditions. Actions that proved that Vidrala is today a stronger company. Let me explain this better. First, in our more traditional region, Southern Europe, we were able to recover in full the margins we had lost during the energy crisis in 2022. And we did it despite demand was abnormally weak during the year, a point that forced us to reduce capacity and control inventories. So this is to explain that we do consider the recovery of our profitability levels, mostly the results of internal actions. You probably have in mind the capacity realignment plan started five years ago. We have divested, invested, closed, and opened capacity, investing selectively. And so, because of these internal reasons, because we are industrially and operationally stronger than ever, we do consider that our margins in this region, in Southern Europe, are safe for 2024. In the UK and Ireland, in our admired company in Zurich, our unique approach was, you probably remember, further enhanced last year after the acquisition of a large boating facility located in the city of Bristol. and transactions that help us capture a very valuable portion of the market, reinforcing NSERC's unparalleled fundamentals as the only company that offers a full 360 approach to the beverage supply chain in the UK. Because this transaction will progressively contribute to profits, and because of the strong competitive fundamentals of our NSERC business, our margins there should progressively improve about 23 levels. In both regions, in Europe and the UK, the path of margin conversions into profits in value will obviously depend on the path of recovery in our demand. But please, let me remark that the level of optimising you are seeing today is based on internal reasons. We are operationally and commercially better than in the past. And third, a more particular case for us. We finally, after a long process of, let's say, analysis, we, late in 2023, completed acquisition of Hydroport. A new division joined in the Vitella Group, an excellent business led by an excellent management team. A big step for us, that represents our entry into Brazil or even into the American continent. That is a platform for future growth. There, in this report, the business is evolving well, as expected. That means that our customers are responding well. We are capturing the sales volumes that are consistent with the new investments, investments that increase our capacity by approximately 30%, and this is being reflected in our numbers. At the end, In Brazil, in 2024, we do reiterate today that our profits will grow, as it was anticipated. In conclusion, we have a much more clear focus on very clear three core divisions that have been selectively defined, that are seeing quite different demand dynamics, business dynamics, that we are managing differently. that at the end creates a great new business combination. My intention with this simple summary is to explain as easy as possible the rationale behind the divestment of our Italian business. We had a plan, and this is part of the plan. We are reallocating capital, refocusing the business on three core divisions, structurally improving our cash profile and our profitability levels, monetizing the value that has been created, and returning part of this value in cash to our shareholders. That was the plan, and we are executing the plan. That ends my conclusions. Thank you very much. Time for your questions.

Okay, thank you. So this completes our explanation. We now give way to the Q&A session.