Vidrala Sa

Buenos días y bienvenidos a la presentación de resultados del ejercicio 2024 de Vidrala. La compañía estará representada por Raúl Gómez, CEO, e Íñigo Mendieta, director de finanzas corporativas. La exposición se realizará en inglés. En el turno de preguntas se atenderán también preguntas en castellano. En la página web de la sociedad www.vidrala.com encontrarán documentación de soporte a esta presentación, así como un enlace para acceder al webcast. Good morning and welcome to the conference call organized by Vidrara to present its 2024 FUES results. Vidrara will be represented in this meeting by Raúl Gómez, CEO and Íñigo Mendieta, Corporate Finances Director. The presentation will be held in English. In the Q&A session, questions will be also answered in Spanish. Nevertheless, it is strongly recommended to post questions in English in order to facilitate understanding of everyone. In the company website www.vidrala.com, you will find available a presentation that will be used as a supporting material to cover this call, as well as a link to access the webcast. Mr. Mendieta, you now have the floor.

Good morning, everyone, and thank you for joining today's call. As announced earlier, Vidrala has released its 2024 full year results, along with a presentation that will serve as a reference throughout the talk. Following the structure of the presentation, we will start with a brief review of today's key figures before opening the floor for Q&A, where we'll go deeper into business performance. So let's begin with the key financials. Over the full year 2024, we delivered revenue of almost 1.6 billion euros, EBITDA of 454 million euros, and a net income equivalent to an EPS of 8.85 euros. Please remember that this net income is not fully representative as it is affected by the impact of 50 million euros capital gain from the sale of our Italian operations. At the end of the period, net debt stood at 248 million euros, representing a leverage ratio of 0.6 times our annual debt. Turning to revenue performance. Total sales for the period reached 1,588.3 million euros, reflecting a 0.2% increase at constant currency and comparable scope. Volume growth of nearly 8% was largely offset by a negative price mix effect. Effects and scope, reflecting the combined effect of incorporating the first 11 months of Videoporto in 2023 and excluding the last 12 months of Italy, contributed an additional 1.7% to revenue growth. Looking at EBITDA, we applied the same breakdown to analyze the year-on-year variation. For the full year 2024, EBITDA came at €454 million, reflecting an organic increase of 10.5%. Including all effects, reported EBITDA growth reached 15.3% year-on-year. These results translated into a solid EBITDA margin of 28.6%, expanding by 330 basis points compared to last year. Now, this slide breaks down sales and EBITDA by business unit, based on the updated perimeter, meaning Vidra Porto is fully included in 2023 figures, while Vidrala Italy is fully excluded in both years. Let me briefly remind that Italy contributed to reported sales and EBITDA for the first two months of 2024, before being reported as discontinued operations, adding to net profit from March to June 2024. So, we observed somewhat different trends across regions. Absolute figures for Iberia are modestly down year-on-year, mainly due to price reductions, but volumes remain resilient, slightly up for the year, along with a strong margin performance. The UK continued to perform well, supported by the integration of the filling business and some bowling lanes in the glass business. And Brazil reflects the impact of the large furnace launch last year, which has enabled us to increase sales volume and improve cost absorption. Now, let's take a close look at free cash flow generation, which is a key priority for us and a critical indicator of our financial health and operational success. This chart illustrates full-year cash conversion, starting with an EBITDA margin of 28.6%. We allocated 10.6% of sales to investments and another 5% to working capital, financial expenses, and taxes. As a result, Free cash flow generation stood at 13% of sales, which is equivalent to 206 million euros, highlighting our strong ability to translate operational performance into solid cash flow generation. And finally, net debt was significantly reduced to 248.3 million euros, with a leverage ratio of 0.6 times our annual GDP. So this shows that we are able to deliver 0.3 times our annual EBITDA in a natural way, excluding the transaction of EBITDA Italy this year. Again, these figures reflect the impact of our recent e-money transactions and the acquired debt, along with proceeds from the sale of our Italian operations, dividends, and serverbacks. This solid financial position gives us a solid foundation and parallel agility and flexibility, and the financial capacity to identify opportunities to further enhance our competitiveness and drive sustainable. And now, before we move to the Q&A, I hand over to Raul, who will summarize the key takeaways and share additional insights.

Thank you, Inigo. And thank you all for attending this call today. We really appreciate your time, particularly for those of you that are connected today far from Europe at different time slots. Good morning. Well, 2024, what a year. What a year for us. We have strategically refocused the business on three careers. We divested from Italy where we were weak. We integrated a large boating facility in Bristol. that has made our business in the UK and Ireland and CERC stronger and even more unique. A business that reached, in 2024, new and higher profitability levels. Also, big thing for us, we have entered Brazil. Very important strategy movement for us. We are very happy to welcome the reporters team with its fantastic leadership. And I am proud to see that we are learning and improving together quite a lot. At the same time, during 2024, we kept on investing in improving our operations in Spain and Portugal, where we are today stronger than before. I mean, more cost competitive. And in the end, with the work of all our people and the support of our customers, we have navigated through quite a challenging macroeconomic environment with, let me say, a reasonable level of efficiency. This is evident in our numbers. Under an overall quite weak unexpected demand context, we have exceeded our initial expectations for EBITDA and cash generation. So, please consider that our 2024 results are a proof of who we have become and what we draw at stake. a business strategically focused with competitive and differential positions in each of our three regions of activity, and a company in a strong financial position. Hope you join me today recognizing that this is the result of our strategic actions, the work of our people, and the support of our customers and our shareholders. We are all part of this. Looking ahead, to 2025, despite macro and the right macro uncertainties and a still weak global consumption environment, we consider that the competitive optimization of our production capacity in Iberia, the value of our unique positioning in the UK, and our continuous progress in Brazil mean that our cash flow levels are safe despite we are to invest more, and our APTA is expected to stay at similar or higher levels in 2025 in comparison with the previous year. In any case, more important for us, far beyond this year, you please consider that we are living in exciting times, a real transformation in the consumer world, and a material progress in our business. We are moving forward with our view on the long-term, strictly fit to our industrial principles. That means that we aim to invest more than before our customer in mind. And we will do so with a financial discipline, firmly committed to our long-term aesthetic guidelines. Customer, cost, and capital. That's all from my side. Thank you very much again for your time and your interest, and you please remind, keep on eating and drinking glass, please. Thank you.