Wienerberger AG

Good morning, everyone, and warm welcome to Vinneberg's half-year 2025 results update. Thank you for taking the time to join us today. My name is Therese Jander, and I'm pleased to be hosting this call today from London. And I'm joined here by Mr. Hermann Scheuch, our CEO and our CFO at Dagmar Steinert. We will begin with a brief presentation of the key developments in the financials, the first half year and afterwards we will open the line for questions. So with that, let me hand over to Mr. Josh.

Thank you very much and also a wonderful morning from my side. We have indeed a very satisfactory set of results for the first half year of 2025. In a, I would call it rather challenging market environment, we were able to increase our turnover by 6% and this shows the receipt So these two parts have contributed throughout our geographies very nicely to this growth in revenues. On the EBITDR front, we are in line with our expectations coming in a little higher than 380 million for the first half. And this shows here again that we were working hard on our cost structures and efficiency improvements that contributed nicely to these robust margins that we were able to achieve. On another note, obviously very satisfactory, we have improved our profit after tax about 100 million, so we're a little above 100 million when you look at the profit after tax for the first half, and the earnings per share have risen to about one euro per share, so also here a very, very satisfactory performance. But let's look a little bit into the different geographies. You remember that we said at the beginning of the year that we expect interest rates cuts. We expect a better underlying market development due to this fact. Unfortunately, we have to draw your attention to whether we're overstated in the North American market, especially in the U.S., there were no such changes in interest rates. So we have still very high mortgage rates at above 7% in the U.S., which are harming the new residential housing market. So we have seen here quite a substantial backdrop or drop in activity in the new residential housing segment affecting our deliveries. First half of the year in the here two aspects that have to some extent affected our deliveries and the volumes that are sold in the U.S. markets. On the other hand, the infrastructure was okay, so the the south of the U.S. On the pricing side, both aspects, meaning on the brick side, under pressure due, obviously, the fact that the market is down, and on the piping side, the prices are down, because raising prices, meaning less than regular prices, but also margins are still on a very satisfactory level in the U.S. Let's move a little bit to Europe. First, our preferred country, the U.K. and Ireland, have done well this first six months of the year. Underlying trends are positive. They are not as strong as originally anticipated, the pickup of new residential housing, but it is a slight pickup and a positive development that we see in both geographies. Therefore, a very satisfactory performance of Wiener Berge, especially in Ireland when Very executed by our management. And on the BRIC side in the UK, a very sort of strong trend when it comes to sales. So we have improved again our performance here with good trends. If I look at our competition locally, the companies are listed here. as our two colleagues listed on the stock exchange here in the UK. Also the infrastructure business of Wienerberg in the UK has done well, so we have improved our performance again in this segment. Continental Europe, a very different picture when you look at different countries and geographies. Let's start in the north. North has been rather stable. of differences to last year. Moving down further south, we have seen good trends in the new residential housing development in the Netherlands, a positive trend there. When it comes to brick operations, also the piping operations have done well due to the fact of the integration of grain plastics that has been acquired last year. So in the Netherlands, we see that the and renovation. Also, Belgium is now stabilizing on the level, and we see slight improvements there, especially in renovation, and then hopefully also new residential housing a little later this year. But the trains are encouraging. The French market, very important for us, and we are We've seen a very good performance of the French roofing business. The thing being about a good contribution, APTR-wise, profit margins are also very satisfactory. Market has somehow stabilized. We see also better trends now in new residential housing in France. So here I would say the market has bottomed out and will probably a little bit improve in the second half of the year. If we then move to, I would call it These two countries are really not turning the corner yet when it comes to especially new residential housing. If it's multi-residential housing or it's individual single-family housing, it's still on a very weak level in both countries. It has to do with financing, it has to do with affordability, it has to do with the banks granting loans, etc. So this is something which has a there where we want it to be. And I don't think that this will change during this year. So from a perspective of volumes and prices, Germany is still a sort of spot where we need to work hard in order to improve our efficiencies. And I don't see anything coming through from the incentives of the government that are Czech Republic, Hungary, Slovakia. Here we see some good encouraging trends in the new residential housing fund, so on a very low level a little gradual growth, but it helps. We gain some momentum there as well, so I think here, mixed with the efficiency improvement, mixed with our sort of focus on production and sales and improvement of the economical situations that certain cities are doing better than others and also regions are doing better than others and obviously the developed much better than we see it today. So, from my perspective, I think here we have seen an underlying market trend, as I called it at the beginning, as challenging. This will remain so for the rest of the year. We'll come to the outlook a little later. But I think when you look at B&B today with our exposure and the such situations. On the acquisition front, we have again completed some very important acquisitions. I spoke about Ireland with MFP, that's a local producer of pipes that has ceased production. We've integrated it in our own network in the UK and in Ireland and have successfully taking over 100% of the solar supplier in France, GSI, but we have now 100%. So we are continuing this growth path. I do see a lot of opportunities right now because it's more, I would call it a buyer's market right now in this area where a lot of certain volatility still remains. And for Wienerberger, a great opportunity to increase our footprint around especially Europe and also North America. With this note, I hand over to Daniela and she will run you through quickly the different financials. Thank you.

Thank you, Heimo. Good morning from my side as well. So let's dig a little bit deeper into the numbers and our solid performance in the first half year of 2025. Our group revenues increased by 6% year-on-year, reaching 2.3 billion. And this growth was driven by volume improvements in Ceramics Europe and contributions from our recent acquisitions. Our operating EBITDA came in at 383 million, that's 4% lower than last year, but of course This decline reflects the burden of cost inflation, but I would like to draw your attention on our margin, which is very robust with 16.3%, and especially if you look at this difficult macroeconomic environment. Looking a little bit deeper into our volume growth of 2% for the whole group, that is clearly driven by European ceramics development and regionally Europe delivered plus 3%. I have already elaborated about the market and the increased demand in the UK, Netherlands and of course Eastern Europe. In Western Europe our main driver was the roofing business and in Eastern Europe the wall business. North America, however, a difficult market for us at the moment, saw a decline of 4%, and that was mainly due to weaker brick volumes. Pipe volumes remained strong during the period. And I just would like to somehow repeat, this volume development reflects really our strategic focus on renovation and infrastructure. Now, as you can see, on our ABD, on our revenue bridge, sorry, I missed it, on our ABDA bridge, that, yes, the 133 million increase in revenue is driven by a combination of organic growth and, of course, of our M&A business. And organic growth contributed 30 million plus. That was mainly supported by volume gains in, to repeat, ceramics Europe, but it was partially offset by pricing, especially in Germany and North America. Both difficult markets for us at the moment. Scope effects added 112 million, and that is primarily from the integration of terrarium. And again, this bridge illustrates our strengths of our M&A strategy and the value of our diverse portfolio. Now, coming to our operating EBITDA bridge, and there I would like to go a little bit deeper into our organic growth of minus 7%, what is impacted by the cost inflation, which was higher than originally expected. especially in rising costs of energy and personal expenses. The currency effect had a modest minus 2 million impact that was mostly from the weak US dollar and that is increasing month by month. Therefore, I'm sure we will see a higher negative impact of that in the full year. From our acquisitions, we got another 30 million plus compared with previous year. So that's quite nice performance. If you look a little bit deeper into our cost inflation, I already mentioned energy is up 15% year on year. and that was driven by global price trends and regional volatility. In some countries, we even saw an increase in energy by 30% or even more. Our personal cost, which amount for very high portion of our overall cost, increased by plus 5%. And that is reflecting, of course, wage adjustments and inflationary contracts and so on. And that is a little bit higher than we originally expected. On the raw material side, it's a little bit of a mixed picture. For ceramics, we saw an increase of plus 3%, while raw materials for the pipe business for the half year remained flat. You might remember in the first quarter, we still had there a slightly increase, and in the second quarter, we saw a decrease. To a certain extent, of course, we manage to give it, to pass it through these cost increases, but of course, we have ourselves given targets, we have our self-help measures, and we have a very, very strict cost discipline. Let me now look at the performance across our regions. So starting with Western Europe, we saw a strong 11% increase in revenues and revenues reached for the half year 1.4 billion. Operating EBTA rose plus 12% to 205 million and showing a margin of 14.9%. This growth was driven by higher volumes in renovation-focused products and roofing, of course, and the contribution from Terreal, which continues to integrate well. In Europe East, revenues grew plus 3%, but our EBITDA declined 8% to 1.3 million, but still showing a margin of 17.3%. We have seen in Eastern Europe quite a high cost inflation, particularly in energy and personnel, which we see over the whole group, but there it was a little bit stronger. North America faced the most pressure, with revenues down by minus 6%, and our EBITDA came in at 75 million, which is of course significant below previous year. But as we're here, I would like to draw your attention to our robust margin of 19.9%, and that's a very good level. As already mentioned, in North America, we've seen severe weather conditions and, of course, that has impacted construction activity and the overall negative market environment. Overall, these results reflect our strengths of our diversified regional portfolio. Turning now to our free cash flow. Free cash flow for the first half year was minus €51 million and that's in line with prior year. That of course reflects our typical seasonality of our business and we've seen a strong second quarter contribution of €124 million. The main driver for the negative figure of course, is our seasonality in building up working capital, and there we spent in the first half 244 million. In the previous year, it has been 230 million, a little bit lower, but we started with a lower level of inventories in the year 2025. Let's now turn to our balance sheet. We have a very solid balance sheet as you can see in our KPIs. We see a seasonal increase in our net debt that's absolutely normal to 2 billion. That's up 250 million roughly compared with year end. This increase is driven by working capital build up and of course our dividend payment where we paid out, including our share buyback, 136 million to our shareholders. Working capital rose to 1.3 billion and reflects, of course, our higher inventory levels and trade receivables. Growth capex was 49 million and our M&A spend was 24 million. Our net debt ABTA ratio remains within a comfortable range, and we continue to maintain strong access to liquidity. So with that, I would like to come slightly to our second quarter results. There you see a decline in revenues, but it's more or less on last year's level, while our operating EBITDA fell to 253 million. And that reflects just somehow the seasonality and different cost inflation and, of course, the seasonality and weak market development compared in the first quarter with the second quarter, but we feel very confident for our second half year that we will remain with a good performance, with a solid margin and that all will be underlined, underbuilt by a strong cost cutting measures and of course a better strong development in renovating, roofing business, what we've seen in the second quarter. And with that, I would like to hand over for the executive summary again to Heimo.