Clariant AG — Call Transcript 2026

Ladies and gentlemen, welcome to the Clariant fourth quarter full year results 2025 conference call and live webcast. I am Valentina, the conference call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Andreas Schwarzwälder, Head of Investor Relations. Please go ahead, sir. Thank you, Valentina. Ladies and gentlemen, good afternoon. My name is Andreas Schwarzwälder, and it's my pleasure to welcome you to this call. Joining me today are Conrad Keijzer, Clariant's CEO, and Oliver Rittgen, Clariant's CFO. Conrad will start today's call by providing an update on the progress we have made on our purpose-led growth strategy and a summary of the full year 2025 financial highlights and savings programs, followed by Oliver, who will guide us through the Q4 and business unit results. Conrad will conclude with the outlook for the full year 2026. There will be a Q&A session following our presentation. At this time, all participants are in listen-only mode. I would like to remind all participants that the presentation includes forward-looking statements, which are subject to risks and uncertainties. Listeners and readers are therefore encouraged to refer to the disclaimer on slide two of today's presentation. As a reminder, this conference call is being recorded. A replay and transcript of the call will be made available on the investor relations sections of the Clariant website. Let me now hand over to Conrad to begin the presentation. Thank you, Andreas. 2025 was a year that demonstrated the success of our transformation journey. The progress we've made over recent years is bearing fruit, with our purpose-led growth strategy proving its strength through effective execution. Built on four strategic pillars, customer focus, innovative chemistry, leading in sustainability, and people engagement, the strategy reflects our integrated approach to creating value for all stakeholders. On our first pillar, customer focus, the execution of our commercial excellence programs delivered further improvement in customer satisfaction, as indicated by the net customer promoter score, cNPS. In 2025, this cNPS increased to 50 versus 45 in 2024, with the company receiving outstanding scores for product quality, technical support, and customer service. Overall, this score placed Clariant in the top quartile amongst peers. Our local for local strategy has continued to help us to weather geopolitical challenges and tariffs. We serve our customers to a very high degree based on local manufacturing and local raw material sourcing. We successfully accelerated the rollout of CLARITY, the cloud-based service platform designed to optimize catalyst management and performance monitoring. It offers 24/7 real-time operations data so that customers can manage their plants more efficiently. By the end of 2025, CLARITY utilization has almost doubled to over 220 customer plants and over 800 users in 38 countries. Finally, differentiated steering, which ensures that we allocate resources strategically. Each business segment has its own strategic mandate to optimize value creation. The restructuring and capacity expansion actions taken in our Additives segment resulted in successful turnaround with improved sales growth and better margins. In our second pillar, innovative chemistry, we demonstrated a strong improvement in innovation sales, reaching 18.8%, marking a significant step up from the 16.9% recorded in 2024. This trajectory reflects the strengths of Clariant's innovation, portfolio, and execution. We maintain our commitment to research and development with sustained investment at 3% of revenue in 2025. The products from our innovation pipeline are growing faster than the rest of our portfolio. We will continue to intensify supplier partnerships to co-develop innovations, meeting the highest environmental standards. This dedication to innovation resulted in over 30 awards and recognitions received throughout the year from customers like L'Oréal, Unilever, and Schneider Electric, and various industry associations. 2025 marked another year of great progress in sustainability leadership. Clariant's greenhouse gas emissions reduction targets that were originally announced at our Investor Day in November 2024, were reviewed and approved by the Science Based Targets initiative in 2025. By 2030, Clariant is committed to reducing absolute Scope 1 and 2 greenhouse gas emissions by 47%, and absolute Scope 3 greenhouse gas emissions by 28% from the 2019 base year. In 2025, Scope 1 and 2 total greenhouse gas emissions fell to 0.43 million metric tons in 2025, a decline of 11%. The main driver for the greenhouse gas reduction in 2025 was a further switch to green electricity. The share of renewable electricity increased from 69% to 76%. The total indirect greenhouse gas emissions for purchased goods and services, Scope 3.1, were 6% lower to 2.4 million metric tons in the last 12 months. As a result of consistent progress over time, credible targets, verified data, and clear accountability, we achieved top leadership level scores across all environmental categories of the Carbon Disclosure Project, CDP, the most widely used environmental disclosure platform globally. Ranking in the top 1% of all companies evaluated worldwide, Clariant was awarded A in climate change and forests, and A- in water security. We are convinced that the transformation toward more sustainable business models will not reverse. Companies that stay on the course will shape the future and gain enduring competitive advantage. People engagement, where we increased our employee net promoter score, ENPS, to 37 in 2025, up from 34 in the prior year. I'm particularly pleased that participation rates of our employees further increased to 88%, and our employee engagement came in at 87%, which positions us in the top quartile compared to industry peers. Our safety performance also was top quartile of the chemical industry globally. Clariant recorded the days away, restricted, or transferred rate of 0.13, down from 0.17 in 2024. This reflects our high awareness and continued commitment to safety, training, and accountability. These achievements are thanks to the hard work of over 10,000 Clariant colleagues across the globe, who are committed to our purpose-led growth strategy and who delivered strong results in 2025. We delivered sales of CHF 3.9 billion, representing a flat performance in a challenging macroeconomic environment. We improved our EBITDA margin before exceptional items by 180 basis points to 17.8%, driven by the successful execution of our performance improvement progress. This is the third year in a row where we have delivered strong EBITDA improvements, both in absolute and in margins. I'm particularly pleased with the 42% cash conversion rate we achieved in 2025. This represents a 10 percentage point improvement compared to 2024, already exceeding our medium-term target of 40%. Our performance in 2025 enables us to propose a stable distribution to shareholders of CHF 0.42 per share. Moving on to more details relating to our financial performance for the full year 2025. We delivered sales of CHF 3.9 billion. This represents a flat performance in local currency, with a reported figure impacted by a 6% negative currency translation effect. We maintained pricing discipline across our portfolio in a slightly deflationary raw material environment, with a year-on-year increase in Adsorbents & Additives, and flat pricing in Care Chemicals and Catalysts. Organic volumes decreased by 1% across the business units. The acquisition of Lucas Meyer Cosmetics had a positive scope impact of 1%. Turning to profitability. We had a strong overall performance with a 180 basis point improvement in EBITDA margin before exceptional items versus the full year 2024, driven by our performance improvement programs and cost productivity across all business units and the corporate functions. In absolute terms, EBITDA before exceptional items increased by 5% to CHF 679 million. As I mentioned earlier, we recorded a free cash flow conversion rate of 42% in 2025. This represents a 10 percentage point increase versus 2024, and delivers on our medium-term target of 40% ahead of schedule. We were able to achieve this through effective cost and margin management, which drove an increase in operating cash flow. Higher net working capital and phasing effects were offset by disciplined CapEx management. In absolute terms, free cash flow increased by 31% to CHF 273 million. Turning to our Investor Day savings program. As a reminder, we expect full run rate savings of CHF 80 million from business units and corporate actions to be delivered by the end of 2027. In Q4, we achieved savings of CHF 19 million, which brings the total to CHF 50 million for 2025. This represents 63% of the total savings target, with the remainder largely expected in 2026. The key measures includes a headcount reduction of approximately 470 full-time equivalents across the business and corporate functions, and the closure of two production lines and two sites as part of our footprint optimization. Procurement added another CHF 22 million savings related to structural changes in qualifying alternative suppliers and implementing best practice contract management. Cost-efficient execution of the programs and phasing led to restructuring charges of CHF 63 million. This was below the CHF 75 million restructuring charges originally expected for the year. With that, I now hand over to Oliver for further details on our business performance in the fourth quarter. Thank you, Conrad, and good afternoon, everyone. In the fourth quarter, we delivered sales of CHF 1 billion, representing an increase of 1% in local currency versus the prior year period. Pricing was overall flat, as formula-based price adjustment linked to raw material costs in Care Chemicals were offset by a 1% increase in Adsorbents & Additives, and flat pricing in Catalysts. Volume increased by 1%, as growth in Catalysts and Care Chemicals offset a decline in Adsorbents & Additives. The reported figure was affected by a 7% currency headwind. Turning to profitability, our Q4 EBITDA before exceptional items increased by 10%, corresponding to a margin of 17.1%. This represents a 240 basis point improvement versus the fourth quarter of 2024. Key contributions came from continuous strong execution of the performance improvement program in all business units, effective cost management, a positive mix due to strong growth in Catalysts, and operating leverage. Let us now dive into the fourth quarter development by business unit, starting with Care Chemicals. Sales increased by 1% in local currency, as 2% volume growth recorded in the quarter more than offset the 1% decline in pricing due to formula-based price adjustments linked to raw material costs. The reported figure was negatively affected by a 7% currency headwind. We recorded low double-digit organic growth in mining solutions, driven entirely by volumes, and in oil services, where higher volumes were supported by slightly positive pricing. Sales in personal and home care increased at a low single-digit rate, also driven by volume growth and including a continued positive contribution from Lucas Meyer Cosmetics. Base chemicals declined slightly despite volume growth in the seasonal Aviation business, as pricing declined due to formula-based price adjustments. Sales in industrial applications declined due to lower pricing and volumes. Crop solutions declined, driven by lower volumes versus the prior year period, when a restocking effect led to strong growth. We recorded an EBITDA before exceptional items of CHF 96 million, representing a 7% increase compared to the prior year. This translated into an EBITDA margin of 18.3%, a 220 basis points improvement, driven by increased operating leverage and a strong contribution from the performance improvement program. In Catalysts, sales increased by 5% in local currency, a result of materially higher volumes in ethylene versus the prior year period. The reported figure was negatively affected by a 7% currency headwind. Sales in ethylene catalyst recorded the strongest growth at a high double-digit percentage rate, with some first fill business coming on top of the regular refill cycle, followed by syngas and fuels. This more than offset lower sales in specialties and propylene, which both declined at a double-digit percentage rate against a strong comparison base in the prior year. EBITDA before exceptional items increased by 22% to CHF 62 million, representing an EBITDA margin of 23.4% versus 18.8% in the prior year. This was driven by effective price and cost management and the contribution from our performance improvement program. Moving to Adsorbents & Additives. Sales decreased by 3% in local currency and by 8% in Swiss francs, as slightly higher pricing was more than offset by lower volumes. In the absorbance segments, sales decreased at a low single percentage rate, as stable volumes in APAC and EMEA were more than offset by a decline in the Americas, which were impacted by delayed US renewable fuel regulation. In the additive segment, sales decreased at a mid-single digit percentage rate, as growth in polymer solutions was more than offset by lower volumes in coating and adhesives, mainly attributable to the construction markets. EBITDA before exceptional items decreased by 9% to CHF 30 million, with an EBITDA margin of 12.6% at a similar level to the prior year. The positive contributions from the performance improvement program partly offset the impact of low volumes. With this, I close my remarks and hand it back to Conrad. Thank you, Oliver. Let me conclude with our outlook for 2026. For 2026, we expect macroeconomic challenges, uncertainties, and risks to remain. According to the latest assessment of Oxford Economics, the global GDP growth projection for 2026 has increased slightly to 2.8%, driven by AI investments. The chemicals industry forecasts predict a reduction of chemical output growth from 2.9% in 2025 to 1.9% in 2026, driven by slower growth in China from 7.4% to 2.7%. In the U.S., turning negative to -0.6% compared to a +0.6% in 2025, while Europe expects some improvement to +0.5% after -0.4% in 2025. Looking at our addressable market, we expect 2026 market growth for Clariant of around 1%, considering our geographic footprint. We remain focused on delivering profitable growth and executing our self-help actions. That said, there are some positive signals in certain end markets. Growth in mining and electric vehicles is expected to continue. We also see continued growth in data centers, a recovery in consumer electronics, supporting our Additives business, and an improvement in renewable fuels demand, supporting our Adsorbents products. We therefore expect sales in local currency to be around flat as we look to offset a negative top line impact for the group of 1% from portfolio pruning in the prior year. We expect slight growth in Care Chemicals on an underlying basis, and in Adsorbents & Additives, while sales in Catalysts are expected to be at levels similar to those in 2025. We expect to further improve our EBITDA margin before exceptional items to around 80% in 2026, with the CHF 80 million performance improvement program expected to deliver most of the remaining cost savings during the year. Clariant expects to continue to achieve a free cash flow conversion of around 40% in 2026. We remain committed to delivering our medium-term targets, assuming a recovery to normalized trading conditions in 2027. I turn the call back over to Andreas. Thank you. Thank you, Conrad and Oliver. Ladies and gentlemen, we're now opening the floor for questions. To ensure everyone has a chance to participate, please ask no more than two questions per person. Thank you for your cooperation. Valentina, please go ahead. Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their telephone. You will hear a tone to confirm that you've entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Questioners on the phone are requested to disable the loudspeaker mode and eventually turn off the volume from the webcast while asking a question. Anyone who has a question or a comment may press star and one at this time. The first question comes from Thea Badaro from BNP Paribas. Please go ahead. Hi, both. Thank you for taking my questions. Two from me, please. We are seeing positive data points in both chemical-specific and industrial surveys, so I'm curious to know if that optimism is also being reflected in your conversations with customers, and if so, are there any end markets in particular? And then my second question is on Care Chemicals. You're guiding for a slight growth for the division in 2026, while many peers are expecting actually a flattish year overall due to tough comps. Can you elaborate on where exactly you're getting more positive? Okay, sure. Yeah, your second question was on Care Chemicals, where you said that many peers are guiding flat growth, is what you say, right? Yeah. Okay, clear. First on the overall market outlook. What you actually see overall is less growth in chemical production rates globally than last year. I mentioned them in our speech, where actually markets are expected to slow down, particularly in China, where we had strong growth last year. That really will be significantly slower this year. In the U.S., where we had positive growth, slightly positive growth this year, markets will turn negative next year, amongst others, also due to trade actions. In Europe, we were slightly negative this year, we may turn slightly positive, but overall, I wouldn't characterize this as an optimistic outlook in chemicals. If you look, what we have in the industry is operating rates, typically between 70% and 80%. That's still historically low. A recovery is typically not expected for this year yet, but more 2027. There, sorry, I've got a cold here. In 2027, there is actually a general consensus that there should be a recovery. If you look at recent years, consumer spending has not been sufficiently on durable goods or semi-durable goods. There was more spending on services and recently on AI. This switch back to durable goods spending and semi-durable goods spending, that is really expected at some point in time. There's a natural replacement cycle to products, but for this to happen, we first need better consumer confidence levels, which still are generally low, considering geopolitical and trade tensions. More specifically, to Care Chemicals, what we say here is actually that in our outlook overall, around flat, there's underlying growth, because last year we had a fair amount of pruning in Care Chemicals, which had an effect of roughly 2% of revenue in Care Chemicals. As you are aware, we closed a site in Argentina. We also shut down a plant in Europe for EO derivatives. With that, when we're giving an outlook of around flat for Care Chemicals, underlying, that means actually that there's growth also in our outlook. The next question comes from Christian Faitz from Kepler Cheuvreux. Please go ahead. Yes, thank you. Good afternoon, Conrad, Oliver, and Andreas, and team, congrats on the results. Two questions, please. First of all, if I look at weather conditions, both in Europe as well as in North America in Q1 so far, I would figure your de-icing business must have been rather robust. Can you confirm this? If so, possibly put a number on this. My second question is on Catalysts. You seem to be a bit less optimistic on your catalyst performance for 2026, after a rather robust Q4, particularly on the ethylene side. Why is this the case? Would you see a sequential slowdown again? Thanks very much. Thank you very much, Christian, for the question. On Care Chemicals and de-icing, we had a strong start. You saw that also, I think, in the press, also one of the airports in Europe almost running out of de-icing material, but it is too early to call it. It really also depends on how March will come in, so we can't really give numbers yet. As far as Catalysts and our outlook for this year, we basically signal that we are bottoming out. I think a recovery in Catalysts really requires a recovery in new builds. If you look right now at our order book, and also what we basically saw last year, is still of the orders, it's by and large a refill business. The new build has dropped to roughly 10% of our orders. For us to really see a big recovery in catalysts, we should see the new builds coming back in. That is visible in the order book, not this year, but if you look at 2027, 2028, 2029, we are seeing actually a pickup in new builds, particularly in China. There is a, let's say, a small wave of new builds coming in there ahead of, their peak carbon year in 2030. We're not seeing a recovery yet this year, Christian. We are bottoming out. We are actually quite optimistic for the years after that. We should see a recovery in Catalysts. Okay, thanks, very helpful. Thank you. The next question comes from Christian Bell, from UBS. Please go ahead. Hello, good morning. I've got two questions, please. My first one is, how should we think about the earnings phasing in 2026? Are you sort of expecting a softer first quarter, then a stronger second half as savings and volumes build? If you could provide a loose guide for first quarter 2026, that would be really useful. The second question, if you could just help me, I'm a little bit confused on your 2026 guidance. You're basically guiding the top line down 3%-5% on currency, which is similar to the outcome in 2025. Last year, you still expanded EBITDA margins by 180 basis points, with CHF 50 million of cost out. With another CHF 30 million planned for 2026, and a similar top line result, what's preventing any margin improvement this time around? Like, what's the difference from 2026 versus 2025 that stops you repeating that same margin progression? Thank you. Okay, Christian, I'll take the first question on phasing. Oliver will provide some more granularity on your second question. As far as the phasing throughout the year, I think we should keep in mind that we had last year, actually, a strong first quarter. Other than that, if you sort of ignore the year-on-year comp, we are seeing a fairly normal pattern throughout the year. It's not that we see a significant recovery in H2 versus H1, like we sometimes had in other years in the outlook. What is important may be some specific comments in Care Chemicals. We see, at the moment, nothing unusual. De-icing is obviously playing a role there in how Q1 will come in. In Catalysts, we are comparing against a strong quarter last year, but normally, we always see a weak Q1, as we also saw last year, after a strong Q4. There is that sequential effect. In Adsorbents & Additives, we are seeing a somewhat weaker start in Adsorbents, where we still are waiting for the regulation for renewables to kick in. The EPA has set ambitious targets for renewable diesel and SAF, but these need to be still endorsed by Congress, and because of the government shutdowns, there's a delay in that. You see that the market expects these increased targets to kick in, because RIN prices are going up, but we're not seeing that in our numbers yet. Other than that, I think there's nothing here to comment. Yeah, Oliver, to you. Hi, Christian. Let me comment on your second question on margin progression year-over-year. I mean, first of all, as you have seen, there's a strong progression from 2024 to 2025, with 180 basis points of improvement, which brought us now to 17.8%. That was driven by the performance improvement programs, the cost productivity, and effective price management, as we said. Of course, and we had a flat top line at this. For 2026, we are guiding for now a second year of flat top line, with the effects that we alluded to before, the pruning that needs to be compensated and the soft market environment. Again, we are executing now on the performance program, delivering further savings in 2026. At the same time, of course, in 2026, like in 2025, we need to compensate for the inflation that is happening in the cost structures that we do have. We guided for 2026, that we have 3%-4% inflation in the cost structure. We have the savings from the savings programs, plus other productivity measures that we're taking, and hence, we guided for around 18%. Of course, the ambition here is to make further progress also towards our medium-term targets. As we alluded to for 2027, that it requires also a bit of a rebound of growth that we, that we then bring it really in. Okay. It just seemed like a similar setup in 2026, with a similar level of cost out. You're basically saying that your underlying inflation, your underlying cost inflation this year is much stronger than it was. Well, you're expecting it to be much stronger this year than it was in 2025? No, the, I mean, there is another year of inflation. I think, Christian, the point is more, we did 180 basis points last year, where we set the organization on a leaner base, and obviously the savings were also a bit higher in 2025 versus 2026, and that's partially driving that effect. Okay, thank you. You're welcome. The next question comes from Katie Richards, from Barclays. Please go ahead. Hi. Yes, good afternoon. I had a question on the use of capital and the balance sheet. You were on Bloomberg this morning, Conrad, and mentioned that Clariant would be open to bolt-on acquisitions, essentially on the scale of Lucas Meyer Cosmetics. You're also, at the same time, targeting CapEx potentially as low as CHF 150 million. A few questions on this then. With leverage coming down and proceeds also coming from Star, which end markets would you be interested in exploring further? Could you also remind us how much you're spending annually for maintenance purposes, please? Finally, how are you looking to balance organic growth versus paying a premium to promote the growth? Yeah, Katie, maybe first, to clarify on comments made this morning on the calls. Yeah, there's nothing new. We're always open for bolt-on acquisitions, but we also said this morning that our first priority is always organic growth, and margin improvement. Then, if we can complement that with the right bolt-on acquisitions, we're very open to that, and we defined as the right ones, acquisitions that really fit to our core segments, and that provide real synergy. Then I mentioned Lucas Meyer as a great example of an acquisition that basically fits those criteria in the past, but that's not to say that there is, right now, a target, of that size available. Just to be clear about that. Overall, people do expect, with limited growth perspectives right now in the chemical industry, that there should be an increased level of potential consolidation ahead of us. What I said this morning is it's important that we obviously participate in industry consolidation, if and when that happens. As far as CapEx maintenance, that's fairly steady at roughly a level of CHF 100 million a year. You see the big reduction in CapEx for us from the fact that we haven't actually added to our footprint, particularly in China, in recent years, and now actually we're very well set up there. Keep in mind, in recent years, we invested CHF 80 million in a new catalyst plant that came up on stream. We invested CHF 80 million last year in a new surfactant plant in Daya Bay that came up on stream. We invested last year, we completed actually the investment of two lines for flame retardants. That was another CHF 100 million. If you look at those items alone, that explains why the CapEx envelope is structurally lower than it was in the past. We haven't cut any corners on maintenance CapEx, so no worries there. That's at a fairly steady level, around roughly CHF 100 million a year. Thank you. Thank you. The next question comes from Michael Schaefer from Oddo BHF. Please go ahead. Yeah, thanks for taking my two questions. On one end, first one, I wanna come back to your Catalysts outlook for 2026. As you said, you guide for flat local currency sales into 2026. Nevertheless, you also reported on some greenfield projects helping you to record what we haven't seen for quite some time, this kind of EBITDA level in the fourth quarter, and I think also on the full year, the 20.8% margin was rather unique over the past four or five years, so to say. I wonder, how should we think about mix effect into 2026, and how margin is progressing in the Catalysts segment? This would be my first question. on the cash flow in 2026. You built up some working capital, quite sizable, in 2025, maybe a bit of a surprise here, talking also about phasing effects. How should we think about the measures you are implementing, and what do you expect in 2026 in terms of working capital? Thanks Yeah. I will answer the question on margins and mix outlook for Catalysts and also we'll provide some clarity on working capital movements. If you look at Catalysts and the performance that we saw, we're very pleased that in these new builds that is out there, that we're getting it. That is, I think, very positive. Particularly on ethylene, there is actually a large project in Europe that is starting up early next year. We see actually the first sale order for that coming in. That is, that's very positive. We also saw, if you look at syngas and ethylene, we saw actually that both of these segments are performing well on refill. We have a full share on new builds, and if it's about refill, we think that particularly on syngas, we've gained some share. If you look at our margins, they are reflecting that as well. There is the very positive effects from the cost outs, also in Catalysts, but there's also underlying a structural improvement in mix. What you see is, in Catalysts, with rising prices for metals, it is not an easy environment. You may have seen the profitability reports of some of our competitors that show EBITDA margins significantly down. We're actually very pleased with the results in Catalysts, with a 21% EBITDA margin for the year. But to further step up the margin in a significant way, in the year ahead of us, that is still requires a pickup. That still would require a pickup in new builds, and that is not yet what we see for this year. We see that more for 2027. Hi, Michael. On working capital and cash, let me first start from the broader picture of cash. I mean, we are very satisfied with the cash performance overall that we had in 2025. 10 percentage points of cash conversion up versus previous year, CHF 80 million better operational cash flow performance. Indeed, we had a bit of a build up in net working capital that we then also compensated with very disciplined CapEx management. That build up in net working capital in the fourth quarter is also a bit related to the phasing or the sales pattern that we have seen in the fourth quarter. We had a very strong December in Catalysts, but also in Care with the Aviation business. I mean, obviously, with the payment terms that you have then on these sales, you have a bit of a build up of accounts receivables. We also have slowed down on inventory build up in AMA, which had an impact on accounts payable. We had a couple of effects at the end of Q4. What we have done independent of that particular quarter is that we initiated a cash program in Clariant where we structurally will look into the different net working capital levels. It's an integrated approach across the business units. It's ingrained in the target setting that we have on a segment level. It's a clear focus area. You have seen it also with our triangle, to say, growth, margin, cash. That's what we focus on. That is what drives our differentiated steering. There's a focus on net working capital and to drive that down in 2026. The next question comes from Julia Winckelmann from Bank of America. Please go ahead. Hi. Thanks for taking my question. I was wondering, you finished the year ahead of schedule on your cost savings target and also achieved your cash conversion target already. Given this progress, do you plan to update your midterm targets and perhaps also give an update on how to think about your capital allocation going forward, given the stronger cash generation? Yeah, Julia, that's a great question, and we are obviously very happy with and pleased with how we finished the year in terms of our EBITDA margin being up 180 basis points and our cash conversion being up 10 points to slightly over 40% conversion now. Where we are versus the midterm targets is that indeed, for cash conversion, we have achieved these targets already. It's fair to say that we still have a bridge from 17.8% to the bottom range, which was 19%-21% EBITDA margin. I will say, we look at three years in a row now of improvement, annual improvement in EBITDA margins, as well as absolute EBITDA. We came from 14.6%. We're now at 17.8%. That was certainly in a challenging market environment for us now to revisit the midterm targets, that's not on the agenda. We're very much focused on delivering them. We are very much focused to have all the levers in place to bridge towards the 19%-21% EBITDA margin, that is the differentiated growth strategy. It's repositioning the businesses to more profitable segments. It is finishing the cost out program, as Oliver has alluded to. It is maintaining pricing discipline, with that, we think we have the levers in place in addition to a pickup in markets that we do anticipate for 2027. We have all the levers in place to deliver the 19%-21%. Yeah, that is, those are actually quite ambitious targets, in the current environment. Thank you. Thank you. The next question comes from Tristan Lamotte from Deutsche Bank. Please go ahead. Hi, thanks. Two questions, please. The first is, could you maybe just run through your end markets and the trends and outlook that you see in those, so in agriculture, autos, construction, electronics, et cetera? Can I ask a general question about your view on the threats to European specialty chemicals companies from China? Do you still think that European chemical companies have sustainable moats in specialty chemicals, and to what extent are you seeing Chinese competition moving into specialties so far, and to what extent do you expect that to accelerate over the next 10 years? Thanks. Yeah, sure. These are important questions. First on end markets, what we are seeing. Well, first of all, let me start with Care Chemicals. We see, in general, the consumer-facing segments with a robust demand. If you look at personal care, home care, that is basically low to mid-single digit growth, with a bit more growth in personal care in the premium segments, like skincare, haircare. Really the premium products, the level just under that, there is actually some downtrading, the so-called aspirational buyers. Home care, very solid and robust laundry, things like that. Crop Protection, we've had interesting years behind us. Last year, we had a strong year in Crop Protection, but that was really very much because the year before, we had still the destocking, so it was also, let's say, some of the year-on-year comparisons. I think now we have a much cleaner comparison, and we should more trade in line with historic levels, where we sort of, yeah, slightly we outperform GDP levels. Oil and gas, it's basically a relatively modest outlook right now. Oil prices, yeah, now they're up to $70 because of the geopolitical turmoil in the Middle East, but In reality, there's plenty of supply, and more so than demand, so it's not an environment with how high oil prices or a lot of investments that we are seeing there. Mining continues to be positive, especially for items like copper and steel, and lithium. Catalysts, we still globally run 70%-80% util rates. For us, really to see new builds kicking in, we need to go first to higher utilization levels. I did mention China as one, where 2027, 2028, 2029, we are seeing new builds coming back in. For this year, it is really a bottoming out year in Catalysts in our forecast. Finally, Additives and Adsorbents. What we see actually is relatively weak demand, if you look at electronics and particularly smartphones, but that was already the case last year. Actually, there's a certain level of maturity here, with very low single digits rates for growth for smartphones. PC production was actually quite nicely up last year. We think that will continue to be relatively okay. Finally, if you look at our Additives business, and markets like furniture, we had expected a big recovery there last year already, as consumers, at some point, should spend on durable goods again, or semi-durables, but it hasn't happened yet. For this year, so far, we're not seeing that either. To finish it all off with Adsorbents, this is very much for us, driven by renewable diesel, now, sustainable Aviation fuel. In Europe, there are mandates in place, but in the U.S., we're still waiting for the endorsement by Congress for the new increased EPA targets, but that should come at some point in the year. Overall, if you summarized it's a very modest sort of growth environment overall, and with some differences by region. Maybe specifically on your second question on China, and how is this impacting specialty chemicals? I think there is a big difference between commodity and petrochemicals on the one hand, and specialty chemicals on the other side. In China, there is significant capacity being built up in recent years for commodity chemicals, for petrochemicals. In specialty chemicals, we are not seeing that level of competition in China. I mean, this is based on IP that took decades to develop. Actually, what we see is that for our business, we make good margins in China. There is a shift where we increasingly supply to local Chinese companies. I think high level, the other big impact that China has is historically, Europe was exporting a significant part of its production into China, the same with the U.S. That has come down significantly, and China has become an exporter for some items, but not so much in specialty chemicals again, it's much more on the commodity side. Very helpful. Thanks. Thank you. The next question comes from Chetan Udeshi, from JPMorgan. Please go ahead. Hi. Thanks for taking my question. I just wanted to follow up, Conrad, on your comment on industry consolidation. I'm a bit puzzled and also curious that we've not seen much happen already. You know, for Clariant, you've signaled openness to participate in any consolidation. You know, you have a very different business structure. You know, in the sense like, you know, you've got Catalysts business, you've got Care Chemicals, which is comprised of industrial plus consumer, and then, of course, you have Adsorbents & Additives. It just feels like, you know, the structure of the business is probably too complicated to see, you know, Clariant as an obvious candidate or, you know, initiator of any consolidation. I'm just curious how you think about that? Was it a question or an opinion that you were voicing, Chetan? It's a both. I mean, a bit of both. You know, I think it's not just for Clariant. I'm just curious, you know, is this a problem for the industry overall, that, you know? Sure. There is no, like, pure play company that is easy to buy or easy to sell, and that makes it quite, you know, complex for industry to consider? No, it's an important question that you, that you're raising. If you look big picture, where we came from is we were a hybrid. Clariant was both active in commodity businesses and in specialty businesses. If you look at the recent years, we've really repositioned the business to become fully specialty. If you look at the recent, let's say, five years, what we did is in 2022, we divested our pigment business, which we clearly saw that was commoditizing. By the way, it has indeed even further commoditized, so I'm glad that we divested that in 2022. A year later, we divested our North America Land Oil business, which also was very much a commodity business. If you look now, what we also did was we divested a part of our Care Chemicals business, the commodity surfactants, to Wilmar, and we put it in a joint venture there. We've done actually quite a bit in recent years to, first of all, get out of our commodity business, but at the same time to strengthen our specialty chemical business. We did a number of smaller, bolt-on acquisitions. We bought the cosmetic ingredients business in Brazil with actives. We bought the green surfactant business in India. We did the purification business from BASF for renewable diesel, Attapulgite in the United States, and last but not least, the Lucas Meyer Cosmetics business, which really strengthens our position in personal care. What you see now is that we have leading positions in specialty chemicals in the segments where we compete. At the same token, what you also see, Chetan, is that we have year-on-year improved the profitability of these businesses. We rarely get the question asked, "Are you the right owner for this business?" As long as we just continue to improve the profitability and in fact achieve leading profitability, both in terms of growth, in terms of margins, we have very sustainable positions in each of these segments because we are having significant market shares in the individual businesses. Yeah, that's, I think, sort of the summary from sort of an M&A perspective, where we are, and we remain interested to continue to do bolt-on acquisitions in these businesses, but only if they bring real synergy. Makes sense. Thank you very much. Thank you. The next question comes from Jaideep Pandya from On Field Research. Please go ahead. I, thank you for allowing me to ask question. First question is on Catalyst, actually. What do you think is the longer term outlook like when you look at the next sort of three years, considering so many capacity shutdowns that have been announced in Europe, and also sort of asset rationalization in China, as well? What do you see as a longer term outlook in Catalyst? That's my first question. The second question sort of is I apologize if you have answered this before or if you cannot go in details, but if you can give us some color, at least on the legal situation around the ethylene, cartel case. What sort of provision have you booked already? Any timeline in terms of result that we could hear around this? Finally, just on the consolidation point, Conrad, I mean, from the, from on paper, if I just sort of ask the question differently, what Chetan was, I guess, trying to ask, you know, the obvious candidate for increasing your size would be in Care Chemicals. You know, if there is a case to be presented, are you saying you could be aggressive enough to, you know, further pursue divestments of some of the other areas to pursue increasing size in Care Chemicals? Thank you so much. Yeah. Thank you, Jaideep. Yeah, first, on your question on Catalyst and the long-term outlook, I think what is important to realize is that there has been a shift in production. Europe has actually significantly come down in chemical production. Cefic issued an interesting recent study that since 2022, a total of 37 million tons of capacity has been taken out of the market in Europe. That's roughly 10% of the overall capacity. At the same token, you have seen a buildup of capacity in China and to a lesser extent, in the Middle East. Yeah, so there is a shift. If you look at the global outlook for catalysts, it is actually a fairly robust business, even this, regardless of these shifts, these regional shifts. If you look at the long-term outlook, petrochemicals historically, globally, has always performed at or above GDP. That is still intact. The change is actually that there are some regional shifts, and therefore it was, for us, extremely important to invest in China, in catalysts, in our footprint, and we're very happy with that footprint now that we also have in China to support the local growth. In terms of long-term outlooks, the fundamentals are still intact at a global level, but yeah, there have been regional shifts for sure. In terms of your second question on legal, yeah, in terms of ethylene claims, at this stage, we cannot publicly comment any further than what we've already said. Clariant firmly rejects the allegations and will vehemently defend its position in the proceedings. We do have substantiated economic evidence that the conduct of the parties did not produce any effect on the market. Yeah, we are in litigation, so we cannot comment further on that, other than your question on the provisions, we haven't taken any, and this obviously has been reviewed with our auditor, KPMG, and they're obviously of the same opinion, and you will see that in our integrated report also explained. Thank you. Thank you. The last question for today is a follow-up coming from the line of Thea Badaro, BNP Paribas. Please go ahead. Yeah, thanks. Just a quick follow-up from me. Specifically on the flame retardant business, can you quantify the size of the data center market opportunity for your flame retardant business? Yeah, this is a very interesting question, and we just made a deep dive, actually, on data centers, and to make sure that we capture all of the share that is out there when it's about our products. What we are seeing is, indeed, that our flame retardants are benefiting from this. This is about, the, yeah, our flame retardants for connectors, for switches, switch gears, cable jackets. That is a part of it. There's also a part of it which sits in fire-resistant coatings, actually, that are applied to the infrastructure of these buildings. Finally, and this is also quite important, our Catalysts business, we are really targeting data centers here as well. This is first from a development perspective, we're very happy that we also commercialize now the first application where we basically have a fuel cell technology. We have methane, we have basically gas, we convert it to hydrogen, the hydrogen basically gets converted into water and electricity. This is a climate neutral, if it's biomethane, a climate neutral solution actually, for decentralized and distributed electricity generation in the right high quantities that are necessary. There's other solutions. Nuclear is also mentioned, particularly with the limited grid capacity, the solution will be power plants, small power plants in the United States, and Europe has the same challenge. With Catalyst, we're talking about a very interesting opportunity here, which already the first, what we now commercialize, is a few tens of millions already in revenue in the outlook that we have. The size for flame retardants combined right now globally is also in that order of magnitude. It is not moving the goalpost for the company as a whole, but we are seeing a nice upside from data centers. Thank you. Thank you. Thank you very much. This is Andreas speaking. This concludes today's conference call. A transcript of the call will be available on the Clariant website in due course. The investor relations team is available for any further questions you may have. Once again, thank you for joining the call today, and have a good afternoon. Ladies and gentlemen, the conference is now over. 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Speaker 11: Ladies and gentlemen, welcome to the Clariant fourth quarter full year results 2025 conference call and live webcast. I am Valentina, the conference call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Andreas Schwarzwälder, Head of Investor Relations. Please go ahead, sir. Ladies and gentlemen, welcome to the Clariant fourth quarter full year results 2025 conference call and live webcast. ladies and gentlemen welcome to the clariant fourth quarter full year results 2025 conference call and live webcast I am Valentina, the conference call operator. i am valentina the conference call operator I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. i would like to remind you that all participants will be in listen-only mode and the conference is being recorded The presentation will be followed by a Q&A session. the presentation will be followed by a q&a session You can register for questions at any time by pressing star and one on your telephone. you can register for questions at any time by pressing star and one on your telephone For operator assistance, please press star and zero. for operator assistance please press star and zero The conference must not be recorded for publication or broadcast. the conference must not be recorded for publication or broadcast At this time, it's my pleasure to hand over to Andreas Schwarzwälder, Head of Investor Relations. at this time it's my pleasure to hand over to andreas schwarzwälder head of investor relations Please go ahead, sir. please go ahead sir

Speaker 1: Thank you, Valentina. Ladies and gentlemen, good afternoon. My name is Andreas Schwarzwälder, and it's my pleasure to welcome you to this call. Joining me today are Conrad Keijzer, Clariant's CEO, and Oliver Rittgen, Clariant's CFO. Conrad will start today's call by providing an update on the progress we have made on our purpose-led growth strategy and a summary of the full year 2025 financial highlights and savings programs, followed by Oliver, who will guide us through the Q4 and business unit results. Conrad will conclude with the outlook for the full year 2026. There will be a Q&A session following our presentation. At this time, all participants are in listen-only mode. I would like to remind all participants that the presentation includes forward-looking statements, which are subject to risks and uncertainties. Thank you, Valentina. thank you valentina Ladies and gentlemen, good afternoon. ladies and gentlemen good afternoon My name is Andreas Schwarzwälder, and it's my pleasure to welcome you to this call. my name is andreas schwarzwälder and it's my pleasure to welcome you to this call Joining me today are Conrad Keijzer, Clariant's CEO, and Oliver Rittgen, Clariant's CFO. joining me today are conrad keijzer clariant's ceo and oliver rittgen clariant's cfo Conrad will start today's call by providing an update on the progress we have made on our purpose-led growth strategy and a summary of the full year 2025 financial highlights and savings programs, followed by Oliver, who will guide us through the Q4 and business unit results. conrad will start today's call by providing an update on the progress we have made on our purpose-led growth strategy and a summary of the full year 2025 financial highlights and savings programs followed by oliver who will guide us through the q4 and business unit results Conrad will conclude with the outlook for the full year 2026. conrad will conclude with the outlook for the full year 2026 There will be a Q&A session following our presentation. there will be a q&a session following our presentation At this time, all participants are in listen-only mode. at this time all participants are in listen-only mode I would like to remind all participants that the presentation includes forward-looking statements, which are subject to risks and uncertainties. i would like to remind all participants that the presentation includes forward-looking statements which are subject to risks and uncertainties Listeners and readers are therefore encouraged to refer to the disclaimer on slide two of today's presentation. As a reminder, this conference call is being recorded. A replay and transcript of the call will be made available on the investor relations sections of the Clariant website. Let me now hand over to Conrad to begin the presentation. Listeners and readers are therefore encouraged to refer to the disclaimer on slide two of today's presentation. listeners and readers are therefore encouraged to refer to the disclaimer on slide two of today's presentation As a reminder, this conference call is being recorded. as a reminder this conference call is being recorded A replay and transcript of the call will be made available on the investor relations sections of the Clariant website. a replay and transcript of the call will be made available on the investor relations sections of the clariant website Let me now hand over to Conrad to begin the presentation. let me now hand over to conrad to begin the presentation

Speaker 5: Thank you, Andreas. 2025 was a year that demonstrated the success of our transformation journey. The progress we've made over recent years is bearing fruit, with our purpose-led growth strategy proving its strength through effective execution. Built on four strategic pillars, customer focus, innovative chemistry, leading in sustainability, and people engagement, the strategy reflects our integrated approach to creating value for all stakeholders. On our first pillar, customer focus, the execution of our commercial excellence programs delivered further improvement in customer satisfaction, as indicated by the net customer promoter score, cNPS. In 2025, this cNPS increased to 50 versus 45 in 2024, with the company receiving outstanding scores for product quality, technical support, and customer service. Overall, this score placed Clariant in the top quartile amongst peers. Our local for local strategy has continued to help us to weather geopolitical challenges and tariffs. Thank you, Andreas. 2025 was a year that demonstrated the success of our transformation journey. thank you andreas 2025 was a year that demonstrated the success of our transformation journey The progress we've made over recent years is bearing fruit, with our purpose-led growth strategy proving its strength through effective execution. the progress we've made over recent years is bearing fruit with our purpose-led growth strategy proving its strength through effective execution Built on four strategic pillars, customer focus, innovative chemistry, leading in sustainability, and people engagement, the strategy reflects our integrated approach to creating value for all stakeholders. built on four strategic pillars customer focus innovative chemistry leading in sustainability and people engagement the strategy reflects our integrated approach to creating value for all stakeholders On our first pillar, customer focus, the execution of our commercial excellence programs delivered further improvement in customer satisfaction, as indicated by the net customer promoter score, cNPS. on our first pillar customer focus the execution of our commercial excellence programs delivered further improvement in customer satisfaction as indicated by the net customer promoter score cnps In 2025, this cNPS increased to 50 versus 45 in 2024, with the company receiving outstanding scores for product quality, technical support, and customer service. in 2025 this cnps increased to 50 versus 45 in 2024 with the company receiving outstanding scores for product quality technical support and customer service Overall, this score placed Clariant in the top quartile amongst peers. overall this score placed clariant in the top quartile amongst peers Our local for local strategy has continued to help us to weather geopolitical challenges and tariffs. our local for local strategy has continued to help us to weather geopolitical challenges and tariffs We serve our customers to a very high degree based on local manufacturing and local raw material sourcing. We successfully accelerated the rollout of CLARITY, the cloud-based service platform designed to optimize catalyst management and performance monitoring. It offers 24/7 real-time operations data so that customers can manage their plants more efficiently. By the end of 2025, CLARITY utilization has almost doubled to over 220 customer plants and over 800 users in 38 countries. Finally, differentiated steering, which ensures that we allocate resources strategically. Each business segment has its own strategic mandate to optimize value creation. The restructuring and capacity expansion actions taken in our Additives segment resulted in successful turnaround with improved sales growth and better margins. We serve our customers to a very high degree based on local manufacturing and local raw material sourcing. we serve our customers to a very high degree based on local manufacturing and local raw material sourcing We successfully accelerated the rollout of CLARITY, the cloud-based service platform designed to optimize catalyst management and performance monitoring. we successfully accelerated the rollout of clarity the cloud-based service platform designed to optimize catalyst management and performance monitoring It offers 24/7 real-time operations data so that customers can manage their plants more efficiently. it offers 24/7 real-time operations data so that customers can manage their plants more efficiently By the end of 2025, CLARITY utilization has almost doubled to over 220 customer plants and over 800 users in 38 countries. by the end of 2025 clarity utilization has almost doubled to over 220 customer plants and over 800 users in 38 countries Finally, differentiated steering, which ensures that we allocate resources strategically. finally differentiated steering which ensures that we allocate resources strategically Each business segment has its own strategic mandate to optimize value creation. each business segment has its own strategic mandate to optimize value creation The restructuring and capacity expansion actions taken in our Additives segment resulted in successful turnaround with improved sales growth and better margins. the restructuring and capacity expansion actions taken in our additives segment resulted in successful turnaround with improved sales growth and better margins In our second pillar, innovative chemistry, we demonstrated a strong improvement in innovation sales, reaching 18.8%, marking a significant step up from the 16.9% recorded in 2024. This trajectory reflects the strengths of Clariant's innovation, portfolio, and execution. We maintain our commitment to research and development with sustained investment at 3% of revenue in 2025. The products from our innovation pipeline are growing faster than the rest of our portfolio. We will continue to intensify supplier partnerships to co-develop innovations, meeting the highest environmental standards. This dedication to innovation resulted in over 30 awards and recognitions received throughout the year from customers like L'Oréal, Unilever, and Schneider Electric, and various industry associations. 2025 marked another year of great progress in sustainability leadership. In our second pillar, innovative chemistry, we demonstrated a strong improvement in innovation sales, reaching 18.8%, marking a significant step up from the 16.9% recorded in 2024. in our second pillar innovative chemistry we demonstrated a strong improvement in innovation sales reaching 18.8% marking a significant step up from the 16.9% recorded in 2024 This trajectory reflects the strengths of Clariant's innovation, portfolio, and execution. this trajectory reflects the strengths of clariant's innovation portfolio and execution We maintain our commitment to research and development with sustained investment at 3% of revenue in 2025. we maintain our commitment to research and development with sustained investment at 3% of revenue in 2025 The products from our innovation pipeline are growing faster than the rest of our portfolio. the products from our innovation pipeline are growing faster than the rest of our portfolio We will continue to intensify supplier partnerships to co-develop innovations, meeting the highest environmental standards. we will continue to intensify supplier partnerships to co-develop innovations meeting the highest environmental standards This dedication to innovation resulted in over 30 awards and recognitions received throughout the year from customers like L'Oréal, Unilever, and Schneider Electric, and various industry associations. 2025 marked another year of great progress in sustainability leadership. this dedication to innovation resulted in over 30 awards and recognitions received throughout the year from customers like l'oréal unilever and schneider electric and various industry associations 2025 marked another year of great progress in sustainability leadership Clariant's greenhouse gas emissions reduction targets that were originally announced at our Investor Day in November 2024, were reviewed and approved by the Science Based Targets initiative in 2025. By 2030, Clariant is committed to reducing absolute Scope 1 and 2 greenhouse gas emissions by 47%, and absolute Scope 3 greenhouse gas emissions by 28% from the 2019 base year. In 2025, Scope 1 and 2 total greenhouse gas emissions fell to 0.43 million metric tons in 2025, a decline of 11%. The main driver for the greenhouse gas reduction in 2025 was a further switch to green electricity. The share of renewable electricity increased from 69% to 76%. Clariant's greenhouse gas emissions reduction targets that were originally announced at our Investor Day in November 2024, were reviewed and approved by the Science Based Targets initiative in 2025. clariant's greenhouse gas emissions reduction targets that were originally announced at our investor day in november 2024 were reviewed and approved by the science based targets initiative in 2025 By 2030, Clariant is committed to reducing absolute Scope 1 and 2 greenhouse gas emissions by 47%, and absolute Scope 3 greenhouse gas emissions by 28% from the 2019 base year. by 2030 clariant is committed to reducing absolute scope 1 and 2 greenhouse gas emissions by 47% and absolute scope 3 greenhouse gas emissions by 28% from the 2019 base year In 2025, Scope 1 and 2 total greenhouse gas emissions fell to 0.43 million metric tons in 2025, a decline of 11%. in 2025 scope 1 and 2 total greenhouse gas emissions fell to 0.43 million metric tons in 2025 a decline of 11% The main driver for the greenhouse gas reduction in 2025 was a further switch to green electricity. the main driver for the greenhouse gas reduction in 2025 was a further switch to green electricity The share of renewable electricity increased from 69% to 76%. the share of renewable electricity increased from 69% to 76% The total indirect greenhouse gas emissions for purchased goods and services, Scope 3.1, were 6% lower to 2.4 million metric tons in the last 12 months. As a result of consistent progress over time, credible targets, verified data, and clear accountability, we achieved top leadership level scores across all environmental categories of the Carbon Disclosure Project, CDP, the most widely used environmental disclosure platform globally. Ranking in the top 1% of all companies evaluated worldwide, Clariant was awarded A in climate change and forests, and A- in water security. We are convinced that the transformation toward more sustainable business models will not reverse. Companies that stay on the course will shape the future and gain enduring competitive advantage. The total indirect greenhouse gas emissions for purchased goods and services, Scope 3.1, were 6% lower to 2.4 million metric tons in the last 12 months. the total indirect greenhouse gas emissions for purchased goods and services scope 3.1 were 6% lower to 2.4 million metric tons in the last 12 months As a result of consistent progress over time, credible targets, verified data, and clear accountability, we achieved top leadership level scores across all environmental categories of the Carbon Disclosure Project, CDP, the most widely used environmental disclosure platform globally. as a result of consistent progress over time credible targets verified data and clear accountability we achieved top leadership level scores across all environmental categories of the carbon disclosure project cdp the most widely used environmental disclosure platform globally Ranking in the top 1% of all companies evaluated worldwide, Clariant was awarded A in climate change and forests, and A- in water security. ranking in the top 1% of all companies evaluated worldwide clariant was awarded a in climate change and forests and a- in water security We are convinced that the transformation toward more sustainable business models will not reverse. we are convinced that the transformation toward more sustainable business models will not reverse Companies that stay on the course will shape the future and gain enduring competitive advantage. companies that stay on the course will shape the future and gain enduring competitive advantage People engagement, where we increased our employee net promoter score, ENPS, to 37 in 2025, up from 34 in the prior year. I'm particularly pleased that participation rates of our employees further increased to 88%, and our employee engagement came in at 87%, which positions us in the top quartile compared to industry peers. Our safety performance also was top quartile of the chemical industry globally. Clariant recorded the days away, restricted, or transferred rate of 0.13, down from 0.17 in 2024. This reflects our high awareness and continued commitment to safety, training, and accountability. These achievements are thanks to the hard work of over 10,000 Clariant colleagues across the globe, who are committed to our purpose-led growth strategy and who delivered strong results in 2025. People engagement, where we increased our employee net promoter score, ENPS, to 37 in 2025, up from 34 in the prior year. people engagement where we increased our employee net promoter score enps to 37 in 2025 up from 34 in the prior year I'm particularly pleased that participation rates of our employees further increased to 88%, and our employee engagement came in at 87%, which positions us in the top quartile compared to industry peers. i'm particularly pleased that participation rates of our employees further increased to 88% and our employee engagement came in at 87% which positions us in the top quartile compared to industry peers Our safety performance also was top quartile of the chemical industry globally. our safety performance also was top quartile of the chemical industry globally Clariant recorded the days away, restricted, or transferred rate of 0.13, down from 0.17 in 2024. clariant recorded the days away restricted or transferred rate of 0.13 down from 0.17 in 2024 This reflects our high awareness and continued commitment to safety, training, and accountability. this reflects our high awareness and continued commitment to safety training and accountability These achievements are thanks to the hard work of over 10,000 Clariant colleagues across the globe, who are committed to our purpose-led growth strategy and who delivered strong results in 2025. these achievements are thanks to the hard work of over 10,000 clariant colleagues across the globe who are committed to our purpose-led growth strategy and who delivered strong results in 2025 We delivered sales of CHF 3.9 billion, representing a flat performance in a challenging macroeconomic environment. We improved our EBITDA margin before exceptional items by 180 basis points to 17.8%, driven by the successful execution of our performance improvement progress. This is the third year in a row where we have delivered strong EBITDA improvements, both in absolute and in margins. I'm particularly pleased with the 42% cash conversion rate we achieved in 2025. This represents a 10 percentage point improvement compared to 2024, already exceeding our medium-term target of 40%. Our performance in 2025 enables us to propose a stable distribution to shareholders of CHF 0.42 per share. Moving on to more details relating to our financial performance for the full year 2025. We delivered sales of CHF 3.9 billion, representing a flat performance in a challenging macroeconomic environment. we delivered sales of chf 3.9 billion representing a flat performance in a challenging macroeconomic environment We improved our EBITDA margin before exceptional items by 180 basis points to 17.8%, driven by the successful execution of our performance improvement progress. we improved our ebitda margin before exceptional items by 180 basis points to 17.8% driven by the successful execution of our performance improvement progress This is the third year in a row where we have delivered strong EBITDA improvements, both in absolute and in margins. this is the third year in a row where we have delivered strong ebitda improvements both in absolute and in margins I'm particularly pleased with the 42% cash conversion rate we achieved in 2025. i'm particularly pleased with the 42% cash conversion rate we achieved in 2025 This represents a 10 percentage point improvement compared to 2024, already exceeding our medium-term target of 40%. this represents a 10 percentage point improvement compared to 2024 already exceeding our medium-term target of 40% Our performance in 2025 enables us to propose a stable distribution to shareholders of CHF 0.42 per share. our performance in 2025 enables us to propose a stable distribution to shareholders of chf 0.42 per share Moving on to more details relating to our financial performance for the full year 2025. moving on to more details relating to our financial performance for the full year 2025 We delivered sales of CHF 3.9 billion. This represents a flat performance in local currency, with a reported figure impacted by a 6% negative currency translation effect. We maintained pricing discipline across our portfolio in a slightly deflationary raw material environment, with a year-on-year increase in Adsorbents & Additives, and flat pricing in Care Chemicals and Catalysts. Organic volumes decreased by 1% across the business units. The acquisition of Lucas Meyer Cosmetics had a positive scope impact of 1%. Turning to profitability. We had a strong overall performance with a 180 basis point improvement in EBITDA margin before exceptional items versus the full year 2024, driven by our performance improvement programs and cost productivity across all business units and the corporate functions. We delivered sales of CHF 3.9 billion. we delivered sales of chf 3.9 billion This represents a flat performance in local currency, with a reported figure impacted by a 6% negative currency translation effect. this represents a flat performance in local currency with a reported figure impacted by a 6% negative currency translation effect We maintained pricing discipline across our portfolio in a slightly deflationary raw material environment, with a year-on-year increase in Adsorbents & Additives, and flat pricing in Care Chemicals and Catalysts. we maintained pricing discipline across our portfolio in a slightly deflationary raw material environment with a year-on-year increase in adsorbents & additives and flat pricing in care chemicals and catalysts Organic volumes decreased by 1% across the business units. organic volumes decreased by 1% across the business units The acquisition of Lucas Meyer Cosmetics had a positive scope impact of 1%. the acquisition of lucas meyer cosmetics had a positive scope impact of 1% Turning to profitability. turning to profitability We had a strong overall performance with a 180 basis point improvement in EBITDA margin before exceptional items versus the full year 2024, driven by our performance improvement programs and cost productivity across all business units and the corporate functions. we had a strong overall performance with a 180 basis point improvement in ebitda margin before exceptional items versus the full year 2024 driven by our performance improvement programs and cost productivity across all business units and the corporate functions In absolute terms, EBITDA before exceptional items increased by 5% to CHF 679 million. As I mentioned earlier, we recorded a free cash flow conversion rate of 42% in 2025. This represents a 10 percentage point increase versus 2024, and delivers on our medium-term target of 40% ahead of schedule. We were able to achieve this through effective cost and margin management, which drove an increase in operating cash flow. Higher net working capital and phasing effects were offset by disciplined CapEx management. In absolute terms, free cash flow increased by 31% to CHF 273 million. Turning to our Investor Day savings program. As a reminder, we expect full run rate savings of CHF 80 million from business units and corporate actions to be delivered by the end of 2027. In absolute terms, EBITDA before exceptional items increased by 5% to CHF 679 million. in absolute terms ebitda before exceptional items increased by 5% to chf 679 million As I mentioned earlier, we recorded a free cash flow conversion rate of 42% in 2025. as i mentioned earlier we recorded a free cash flow conversion rate of 42% in 2025 This represents a 10 percentage point increase versus 2024, and delivers on our medium-term target of 40% ahead of schedule. this represents a 10 percentage point increase versus 2024 and delivers on our medium-term target of 40% ahead of schedule We were able to achieve this through effective cost and margin management, which drove an increase in operating cash flow. we were able to achieve this through effective cost and margin management which drove an increase in operating cash flow Higher net working capital and phasing effects were offset by disciplined CapEx management. higher net working capital and phasing effects were offset by disciplined capex management In absolute terms, free cash flow increased by 31% to CHF 273 million. in absolute terms free cash flow increased by 31% to chf 273 million Turning to our Investor Day savings program. turning to our investor day savings program As a reminder, we expect full run rate savings of CHF 80 million from business units and corporate actions to be delivered by the end of 2027. as a reminder we expect full run rate savings of chf 80 million from business units and corporate actions to be delivered by the end of 2027 In Q4, we achieved savings of CHF 19 million, which brings the total to CHF 50 million for 2025. This represents 63% of the total savings target, with the remainder largely expected in 2026. The key measures includes a headcount reduction of approximately 470 full-time equivalents across the business and corporate functions, and the closure of two production lines and two sites as part of our footprint optimization. Procurement added another CHF 22 million savings related to structural changes in qualifying alternative suppliers and implementing best practice contract management. Cost-efficient execution of the programs and phasing led to restructuring charges of CHF 63 million. This was below the CHF 75 million restructuring charges originally expected for the year. With that, I now hand over to Oliver for further details on our business performance in the fourth quarter. In Q4, we achieved savings of CHF 19 million, which brings the total to CHF 50 million for 2025. in q4 we achieved savings of chf 19 million which brings the total to chf 50 million for 2025 This represents 63% of the total savings target, with the remainder largely expected in 2026. this represents 63% of the total savings target with the remainder largely expected in 2026 The key measures includes a headcount reduction of approximately 470 full-time equivalents across the business and corporate functions, and the closure of two production lines and two sites as part of our footprint optimization. the key measures includes a headcount reduction of approximately 470 full-time equivalents across the business and corporate functions and the closure of two production lines and two sites as part of our footprint optimization Procurement added another CHF 22 million savings related to structural changes in qualifying alternative suppliers and implementing best practice contract management. procurement added another chf 22 million savings related to structural changes in qualifying alternative suppliers and implementing best practice contract management Cost-efficient execution of the programs and phasing led to restructuring charges of CHF 63 million. cost-efficient execution of the programs and phasing led to restructuring charges of chf 63 million This was below the CHF 75 million restructuring charges originally expected for the year. this was below the chf 75 million restructuring charges originally expected for the year With that, I now hand over to Oliver for further details on our business performance in the fourth quarter. with that i now hand over to oliver for further details on our business performance in the fourth quarter

Speaker 10: Thank you, Conrad, and good afternoon, everyone. In the fourth quarter, we delivered sales of CHF 1 billion, representing an increase of 1% in local currency versus the prior year period. Pricing was overall flat, as formula-based price adjustment linked to raw material costs in Care Chemicals were offset by a 1% increase in Adsorbents & Additives, and flat pricing in Catalysts. Volume increased by 1%, as growth in Catalysts and Care Chemicals offset a decline in Adsorbents & Additives. The reported figure was affected by a 7% currency headwind. Turning to profitability, our Q4 EBITDA before exceptional items increased by 10%, corresponding to a margin of 17.1%. This represents a 240 basis point improvement versus the fourth quarter of 2024. Thank you, Conrad, and good afternoon, everyone. thank you conrad and good afternoon everyone In the fourth quarter, we delivered sales of CHF 1 billion, representing an increase of 1% in local currency versus the prior year period. in the fourth quarter we delivered sales of chf 1 billion representing an increase of 1% in local currency versus the prior year period Pricing was overall flat, as formula-based price adjustment linked to raw material costs in Care Chemicals were offset by a 1% increase in Adsorbents & Additives, and flat pricing in Catalysts. pricing was overall flat as formula-based price adjustment linked to raw material costs in care chemicals were offset by a 1% increase in adsorbents & additives and flat pricing in catalysts Volume increased by 1%, as growth in Catalysts and Care Chemicals offset a decline in Adsorbents & Additives. volume increased by 1% as growth in catalysts and care chemicals offset a decline in adsorbents & additives The reported figure was affected by a 7% currency headwind. the reported figure was affected by a 7% currency headwind Turning to profitability, our Q4 EBITDA before exceptional items increased by 10%, corresponding to a margin of 17.1%. turning to profitability our q4 ebitda before exceptional items increased by 10% corresponding to a margin of 17.1% This represents a 240 basis point improvement versus the fourth quarter of 2024. this represents a 240 basis point improvement versus the fourth quarter of 2024 Key contributions came from continuous strong execution of the performance improvement program in all business units, effective cost management, a positive mix due to strong growth in Catalysts, and operating leverage. Let us now dive into the fourth quarter development by business unit, starting with Care Chemicals. Sales increased by 1% in local currency, as 2% volume growth recorded in the quarter more than offset the 1% decline in pricing due to formula-based price adjustments linked to raw material costs. The reported figure was negatively affected by a 7% currency headwind. We recorded low double-digit organic growth in mining solutions, driven entirely by volumes, and in oil services, where higher volumes were supported by slightly positive pricing. Sales in personal and home care increased at a low single-digit rate, also driven by volume growth and including a continued positive contribution from Lucas Meyer Cosmetics. Key contributions came from continuous strong execution of the performance improvement program in all business units, effective cost management, a positive mix due to strong growth in Catalysts, and operating leverage. key contributions came from continuous strong execution of the performance improvement program in all business units effective cost management a positive mix due to strong growth in catalysts and operating leverage Let us now dive into the fourth quarter development by business unit, starting with Care Chemicals. let us now dive into the fourth quarter development by business unit starting with care chemicals Sales increased by 1% in local currency, as 2% volume growth recorded in the quarter more than offset the 1% decline in pricing due to formula-based price adjustments linked to raw material costs. sales increased by 1% in local currency as 2% volume growth recorded in the quarter more than offset the 1% decline in pricing due to formula-based price adjustments linked to raw material costs The reported figure was negatively affected by a 7% currency headwind. the reported figure was negatively affected by a 7% currency headwind We recorded low double-digit organic growth in mining solutions, driven entirely by volumes, and in oil services, where higher volumes were supported by slightly positive pricing. we recorded low double-digit organic growth in mining solutions driven entirely by volumes and in oil services where higher volumes were supported by slightly positive pricing Sales in personal and home care increased at a low single-digit rate, also driven by volume growth and including a continued positive contribution from Lucas Meyer Cosmetics. sales in personal and home care increased at a low single-digit rate also driven by volume growth and including a continued positive contribution from lucas meyer cosmetics Base chemicals declined slightly despite volume growth in the seasonal Aviation business, as pricing declined due to formula-based price adjustments. Sales in industrial applications declined due to lower pricing and volumes. Crop solutions declined, driven by lower volumes versus the prior year period, when a restocking effect led to strong growth. We recorded an EBITDA before exceptional items of CHF 96 million, representing a 7% increase compared to the prior year. This translated into an EBITDA margin of 18.3%, a 220 basis points improvement, driven by increased operating leverage and a strong contribution from the performance improvement program. In Catalysts, sales increased by 5% in local currency, a result of materially higher volumes in ethylene versus the prior year period. The reported figure was negatively affected by a 7% currency headwind. Base chemicals declined slightly despite volume growth in the seasonal Aviation business, as pricing declined due to formula-based price adjustments. base chemicals declined slightly despite volume growth in the seasonal aviation business as pricing declined due to formula-based price adjustments Sales in industrial applications declined due to lower pricing and volumes. sales in industrial applications declined due to lower pricing and volumes Crop solutions declined, driven by lower volumes versus the prior year period, when a restocking effect led to strong growth. crop solutions declined driven by lower volumes versus the prior year period when a restocking effect led to strong growth We recorded an EBITDA before exceptional items of CHF 96 million, representing a 7% increase compared to the prior year. we recorded an ebitda before exceptional items of chf 96 million representing a 7% increase compared to the prior year This translated into an EBITDA margin of 18.3%, a 220 basis points improvement, driven by increased operating leverage and a strong contribution from the performance improvement program. this translated into an ebitda margin of 18.3% a 220 basis points improvement driven by increased operating leverage and a strong contribution from the performance improvement program In Catalysts, sales increased by 5% in local currency, a result of materially higher volumes in ethylene versus the prior year period. in catalysts sales increased by 5% in local currency a result of materially higher volumes in ethylene versus the prior year period The reported figure was negatively affected by a 7% currency headwind. the reported figure was negatively affected by a 7% currency headwind Sales in ethylene catalyst recorded the strongest growth at a high double-digit percentage rate, with some first fill business coming on top of the regular refill cycle, followed by syngas and fuels. This more than offset lower sales in specialties and propylene, which both declined at a double-digit percentage rate against a strong comparison base in the prior year. EBITDA before exceptional items increased by 22% to CHF 62 million, representing an EBITDA margin of 23.4% versus 18.8% in the prior year. This was driven by effective price and cost management and the contribution from our performance improvement program. Moving to Adsorbents & Additives. Sales decreased by 3% in local currency and by 8% in Swiss francs, as slightly higher pricing was more than offset by lower volumes. Sales in ethylene catalyst recorded the strongest growth at a high double-digit percentage rate, with some first fill business coming on top of the regular refill cycle, followed by syngas and fuels. sales in ethylene catalyst recorded the strongest growth at a high double-digit percentage rate with some first fill business coming on top of the regular refill cycle followed by syngas and fuels This more than offset lower sales in specialties and propylene, which both declined at a double-digit percentage rate against a strong comparison base in the prior year. this more than offset lower sales in specialties and propylene which both declined at a double-digit percentage rate against a strong comparison base in the prior year EBITDA before exceptional items increased by 22% to CHF 62 million, representing an EBITDA margin of 23.4% versus 18.8% in the prior year. ebitda before exceptional items increased by 22% to chf 62 million representing an ebitda margin of 23.4% versus 18.8% in the prior year This was driven by effective price and cost management and the contribution from our performance improvement program. Moving to Adsorbents & Additives. this was driven by effective price and cost management and the contribution from our performance improvement program. moving to adsorbents & additives Sales decreased by 3% in local currency and by 8% in Swiss francs, as slightly higher pricing was more than offset by lower volumes. sales decreased by 3% in local currency and by 8% in swiss francs as slightly higher pricing was more than offset by lower volumes In the absorbance segments, sales decreased at a low single percentage rate, as stable volumes in APAC and EMEA were more than offset by a decline in the Americas, which were impacted by delayed US renewable fuel regulation. In the additive segment, sales decreased at a mid-single digit percentage rate, as growth in polymer solutions was more than offset by lower volumes in coating and adhesives, mainly attributable to the construction markets. EBITDA before exceptional items decreased by 9% to CHF 30 million, with an EBITDA margin of 12.6% at a similar level to the prior year. The positive contributions from the performance improvement program partly offset the impact of low volumes. With this, I close my remarks and hand it back to Conrad. In the absorbance segments, sales decreased at a low single percentage rate, as stable volumes in APAC and EMEA were more than offset by a decline in the Americas, which were impacted by delayed US renewable fuel regulation. in the absorbance segments sales decreased at a low single percentage rate as stable volumes in apac and emea were more than offset by a decline in the americas which were impacted by delayed us renewable fuel regulation In the additive segment, sales decreased at a mid-single digit percentage rate, as growth in polymer solutions was more than offset by lower volumes in coating and adhesives, mainly attributable to the construction markets. in the additive segment sales decreased at a mid-single digit percentage rate as growth in polymer solutions was more than offset by lower volumes in coating and adhesives mainly attributable to the construction markets EBITDA before exceptional items decreased by 9% to CHF 30 million, with an EBITDA margin of 12.6% at a similar level to the prior year. ebitda before exceptional items decreased by 9% to chf 30 million with an ebitda margin of 12.6% at a similar level to the prior year The positive contributions from the performance improvement program partly offset the impact of low volumes. the positive contributions from the performance improvement program partly offset the impact of low volumes With this, I close my remarks and hand it back to Conrad. with this i close my remarks and hand it back to conrad

Speaker 5: Thank you, Oliver. Let me conclude with our outlook for 2026. For 2026, we expect macroeconomic challenges, uncertainties, and risks to remain. According to the latest assessment of Oxford Economics, the global GDP growth projection for 2026 has increased slightly to 2.8%, driven by AI investments. The chemicals industry forecasts predict a reduction of chemical output growth from 2.9% in 2025 to 1.9% in 2026, driven by slower growth in China from 7.4% to 2.7%. In the U.S., turning negative to -0.6% compared to a +0.6% in 2025, while Europe expects some improvement to +0.5% after -0.4% in 2025. Thank you, Oliver. thank you oliver Let me conclude with our outlook for 2026. let me conclude with our outlook for 2026 For 2026, we expect macroeconomic challenges, uncertainties, and risks to remain. for 2026 we expect macroeconomic challenges uncertainties and risks to remain According to the latest assessment of Oxford Economics, the global GDP growth projection for 2026 has increased slightly to 2.8%, driven by AI investments. according to the latest assessment of oxford economics the global gdp growth projection for 2026 has increased slightly to 2.8% driven by ai investments The chemicals industry forecasts predict a reduction of chemical output growth from 2.9% in 2025 to 1.9% in 2026, driven by slower growth in China from 7.4% to 2.7%. the chemicals industry forecasts predict a reduction of chemical output growth from 2.9% in 2025 to 1.9% in 2026 driven by slower growth in china from 7.4% to 2.7% In the U.S., turning negative to -0.6% compared to a +0.6% in 2025, while Europe expects some improvement to +0.5% after -0.4% in 2025. in the u.s turning negative to -0.6% compared to a +0.6% in 2025 while europe expects some improvement to +0.5% after -0.4% in 2025 Looking at our addressable market, we expect 2026 market growth for Clariant of around 1%, considering our geographic footprint. We remain focused on delivering profitable growth and executing our self-help actions. That said, there are some positive signals in certain end markets. Growth in mining and electric vehicles is expected to continue. We also see continued growth in data centers, a recovery in consumer electronics, supporting our Additives business, and an improvement in renewable fuels demand, supporting our Adsorbents products. We therefore expect sales in local currency to be around flat as we look to offset a negative top line impact for the group of 1% from portfolio pruning in the prior year. We expect slight growth in Care Chemicals on an underlying basis, and in Adsorbents & Additives, while sales in Catalysts are expected to be at levels similar to those in 2025. Looking at our addressable market, we expect 2026 market growth for Clariant of around 1%, considering our geographic footprint. looking at our addressable market we expect 2026 market growth for clariant of around 1% considering our geographic footprint We remain focused on delivering profitable growth and executing our self-help actions. we remain focused on delivering profitable growth and executing our self-help actions That said, there are some positive signals in certain end markets. that said there are some positive signals in certain end markets Growth in mining and electric vehicles is expected to continue. growth in mining and electric vehicles is expected to continue We also see continued growth in data centers, a recovery in consumer electronics, supporting our Additives business, and an improvement in renewable fuels demand, supporting our Adsorbents products. we also see continued growth in data centers a recovery in consumer electronics supporting our additives business and an improvement in renewable fuels demand supporting our adsorbents products We therefore expect sales in local currency to be around flat as we look to offset a negative top line impact for the group of 1% from portfolio pruning in the prior year. we therefore expect sales in local currency to be around flat as we look to offset a negative top line impact for the group of 1% from portfolio pruning in the prior year We expect slight growth in Care Chemicals on an underlying basis, and in Adsorbents & Additives, while sales in Catalysts are expected to be at levels similar to those in 2025. we expect slight growth in care chemicals on an underlying basis and in adsorbents & additives while sales in catalysts are expected to be at levels similar to those in 2025 We expect to further improve our EBITDA margin before exceptional items to around 80% in 2026, with the CHF 80 million performance improvement program expected to deliver most of the remaining cost savings during the year. Clariant expects to continue to achieve a free cash flow conversion of around 40% in 2026. We remain committed to delivering our medium-term targets, assuming a recovery to normalized trading conditions in 2027. I turn the call back over to Andreas. We expect to further improve our EBITDA margin before exceptional items to around 80% in 2026, with the CHF 80 million performance improvement program expected to deliver most of the remaining cost savings during the year. we expect to further improve our ebitda margin before exceptional items to around 80% in 2026 with the chf 80 million performance improvement program expected to deliver most of the remaining cost savings during the year Clariant expects to continue to achieve a free cash flow conversion of around 40% in 2026. clariant expects to continue to achieve a free cash flow conversion of around 40% in 2026 We remain committed to delivering our medium-term targets, assuming a recovery to normalized trading conditions in 2027. we remain committed to delivering our medium-term targets assuming a recovery to normalized trading conditions in 2027 I turn the call back over to Andreas. i turn the call back over to andreas

Speaker 1: Thank you. Thank you, Conrad and Oliver. Ladies and gentlemen, we're now opening the floor for questions. To ensure everyone has a chance to participate, please ask no more than two questions per person. Thank you for your cooperation. Valentina, please go ahead. Thank you. thank you Thank you, Conrad and Oliver. thank you conrad and oliver Ladies and gentlemen, we're now opening the floor for questions. ladies and gentlemen we're now opening the floor for questions To ensure everyone has a chance to participate, please ask no more than two questions per person. to ensure everyone has a chance to participate please ask no more than two questions per person Thank you for your cooperation. thank you for your cooperation Valentina, please go ahead. valentina please go ahead

Speaker 11: Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their telephone. You will hear a tone to confirm that you've entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Questioners on the phone are requested to disable the loudspeaker mode and eventually turn off the volume from the webcast while asking a question. Anyone who has a question or a comment may press star and one at this time. The first question comes from Thea Badaro from BNP Paribas. Please go ahead. Thank you. thank you We will now begin the question and answer session. we will now begin the question and answer session Anyone who wishes to ask a question may press star and one on their telephone. anyone who wishes to ask a question may press star and one on their telephone You will hear a tone to confirm that you've entered the queue. you will hear a tone to confirm that you've entered the queue If you wish to remove yourself from the question queue, you may press star and two. if you wish to remove yourself from the question queue you may press star and two Questioners on the phone are requested to disable the loudspeaker mode and eventually turn off the volume from the webcast while asking a question. questioners on the phone are requested to disable the loudspeaker mode and eventually turn off the volume from the webcast while asking a question Anyone who has a question or a comment may press star and one at this time. anyone who has a question or a comment may press star and one at this time The first question comes from Thea Badaro from BNP Paribas. the first question comes from thea badaro from bnp paribas Please go ahead. please go ahead

Speaker 12: Hi, both. Thank you for taking my questions. Two from me, please. We are seeing positive data points in both chemical-specific and industrial surveys, so I'm curious to know if that optimism is also being reflected in your conversations with customers, and if so, are there any end markets in particular? And then my second question is on Care Chemicals. You're guiding for a slight growth for the division in 2026, while many peers are expecting actually a flattish year overall due to tough comps. Can you elaborate on where exactly you're getting more positive? Hi, both. hi both Thank you for taking my questions. thank you for taking my questions Two from me, please. two from me please We are seeing positive data points in both chemical-specific and industrial surveys, so I'm curious to know if that optimism is also being reflected in your conversations with customers, and if so, are there any end markets in particular? we are seeing positive data points in both chemical-specific and industrial surveys so i'm curious to know if that optimism is also being reflected in your conversations with customers and if so are there any end markets in particular And then my second question is on Care Chemicals. and then my second question is on care chemicals You're guiding for a slight growth for the division in 2026, while many peers are expecting actually a flattish year overall due to tough comps. you're guiding for a slight growth for the division in 2026 while many peers are expecting actually a flattish year overall due to tough comps Can you elaborate on where exactly you're getting more positive? can you elaborate on where exactly you're getting more positive

Speaker 5: Okay, sure. Yeah, your second question was on Care Chemicals, where you said that many peers are guiding flat growth, is what you say, right? Okay, sure. okay sure Yeah, your second question was on Care Chemicals, where you said that many peers are guiding flat growth, is what you say, right? yeah your second question was on care chemicals where you said that many peers are guiding flat growth is what you say right

Speaker 12: Yeah. Yeah. yeah

Speaker 5: Okay, clear. First on the overall market outlook. What you actually see overall is less growth in chemical production rates globally than last year. I mentioned them in our speech, where actually markets are expected to slow down, particularly in China, where we had strong growth last year. That really will be significantly slower this year. In the U.S., where we had positive growth, slightly positive growth this year, markets will turn negative next year, amongst others, also due to trade actions. In Europe, we were slightly negative this year, we may turn slightly positive, but overall, I wouldn't characterize this as an optimistic outlook in chemicals. If you look, what we have in the industry is operating rates, typically between 70% and 80%. Okay, clear. okay clear First on the overall market outlook. first on the overall market outlook What you actually see overall is less growth in chemical production rates globally than last year. what you actually see overall is less growth in chemical production rates globally than last year I mentioned them in our speech, where actually markets are expected to slow down, particularly in China, where we had strong growth last year. i mentioned them in our speech where actually markets are expected to slow down particularly in china where we had strong growth last year That really will be significantly slower this year. that really will be significantly slower this year In the U.S., where we had positive growth, slightly positive growth this year, markets will turn negative next year, amongst others, also due to trade actions. in the u.s where we had positive growth slightly positive growth this year markets will turn negative next year amongst others also due to trade actions In Europe, we were slightly negative this year, we may turn slightly positive, but overall, I wouldn't characterize this as an optimistic outlook in chemicals. in europe we were slightly negative this year we may turn slightly positive but overall i wouldn't characterize this as an optimistic outlook in chemicals If you look, what we have in the industry is operating rates, typically between 70% and 80%. if you look what we have in the industry is operating rates typically between 70% and 80% That's still historically low. A recovery is typically not expected for this year yet, but more 2027. There, sorry, I've got a cold here. In 2027, there is actually a general consensus that there should be a recovery. If you look at recent years, consumer spending has not been sufficiently on durable goods or semi-durable goods. There was more spending on services and recently on AI. This switch back to durable goods spending and semi-durable goods spending, that is really expected at some point in time. There's a natural replacement cycle to products, but for this to happen, we first need better consumer confidence levels, which still are generally low, considering geopolitical and trade tensions. That's still historically low. that's still historically low A recovery is typically not expected for this year yet, but more 2027. a recovery is typically not expected for this year yet but more 2027 There, sorry, I've got a cold here. there sorry i've got a cold here In 2027, there is actually a general consensus that there should be a recovery. in 2027 there is actually a general consensus that there should be a recovery If you look at recent years, consumer spending has not been sufficiently on durable goods or semi-durable goods. if you look at recent years consumer spending has not been sufficiently on durable goods or semi-durable goods There was more spending on services and recently on AI. there was more spending on services and recently on ai This switch back to durable goods spending and semi-durable goods spending, that is really expected at some point in time. this switch back to durable goods spending and semi-durable goods spending that is really expected at some point in time There's a natural replacement cycle to products, but for this to happen, we first need better consumer confidence levels, which still are generally low, considering geopolitical and trade tensions. there's a natural replacement cycle to products but for this to happen we first need better consumer confidence levels which still are generally low considering geopolitical and trade tensions More specifically, to Care Chemicals, what we say here is actually that in our outlook overall, around flat, there's underlying growth, because last year we had a fair amount of pruning in Care Chemicals, which had an effect of roughly 2% of revenue in Care Chemicals. As you are aware, we closed a site in Argentina. We also shut down a plant in Europe for EO derivatives. With that, when we're giving an outlook of around flat for Care Chemicals, underlying, that means actually that there's growth also in our outlook. More specifically, to Care Chemicals, what we say here is actually that in our outlook overall, around flat, there's underlying growth, because last year we had a fair amount of pruning in Care Chemicals, which had an effect of roughly 2% of revenue in Care Chemicals. more specifically to care chemicals what we say here is actually that in our outlook overall around flat there's underlying growth because last year we had a fair amount of pruning in care chemicals which had an effect of roughly 2% of revenue in care chemicals As you are aware, we closed a site in Argentina. as you are aware we closed a site in argentina We also shut down a plant in Europe for EO derivatives. we also shut down a plant in europe for eo derivatives With that, when we're giving an outlook of around flat for Care Chemicals, underlying, that means actually that there's growth also in our outlook. with that when we're giving an outlook of around flat for care chemicals underlying that means actually that there's growth also in our outlook

Speaker 11: The next question comes from Christian Faitz from Kepler Cheuvreux. Please go ahead. The next question comes from Christian Faitz from Kepler Cheuvreux. the next question comes from christian faitz from kepler cheuvreux Please go ahead. please go ahead

Speaker 4: Yes, thank you. Good afternoon, Conrad, Oliver, and Andreas, and team, congrats on the results. Two questions, please. First of all, if I look at weather conditions, both in Europe as well as in North America in Q1 so far, I would figure your de-icing business must have been rather robust. Can you confirm this? If so, possibly put a number on this. My second question is on Catalysts. You seem to be a bit less optimistic on your catalyst performance for 2026, after a rather robust Q4, particularly on the ethylene side. Why is this the case? Would you see a sequential slowdown again? Thanks very much. Yes, thank you. yes thank you Good afternoon, Conrad, Oliver, and Andreas, and team, congrats on the results. good afternoon conrad oliver and andreas and team congrats on the results Two questions, please. two questions please First of all, if I look at weather conditions, both in Europe as well as in North America in Q1 so far, I would figure your de-icing business must have been rather robust. first of all if i look at weather conditions both in europe as well as in north america in q1 so far i would figure your de-icing business must have been rather robust Can you confirm this? can you confirm this If so, possibly put a number on this. if so possibly put a number on this My second question is on Catalysts. my second question is on catalysts You seem to be a bit less optimistic on your catalyst performance for 2026, after a rather robust Q4, particularly on the ethylene side. you seem to be a bit less optimistic on your catalyst performance for 2026 after a rather robust q4 particularly on the ethylene side Why is this the case? why is this the case Would you see a sequential slowdown again? would you see a sequential slowdown again Thanks very much. thanks very much

Speaker 5: Thank you very much, Christian, for the question. On Care Chemicals and de-icing, we had a strong start. You saw that also, I think, in the press, also one of the airports in Europe almost running out of de-icing material, but it is too early to call it. It really also depends on how March will come in, so we can't really give numbers yet. As far as Catalysts and our outlook for this year, we basically signal that we are bottoming out. I think a recovery in Catalysts really requires a recovery in new builds. Thank you very much, Christian, for the question. thank you very much christian for the question On Care Chemicals and de-icing, we had a strong start. on care chemicals and de-icing we had a strong start You saw that also, I think, in the press, also one of the airports in Europe almost running out of de-icing material, but it is too early to call it. you saw that also i think in the press also one of the airports in europe almost running out of de-icing material but it is too early to call it It really also depends on how March will come in, so we can't really give numbers yet. it really also depends on how march will come in so we can't really give numbers yet As far as Catalysts and our outlook for this year, we basically signal that we are bottoming out. as far as catalysts and our outlook for this year we basically signal that we are bottoming out I think a recovery in Catalysts really requires a recovery in new builds. i think a recovery in catalysts really requires a recovery in new builds If you look right now at our order book, and also what we basically saw last year, is still of the orders, it's by and large a refill business. The new build has dropped to roughly 10% of our orders. For us to really see a big recovery in catalysts, we should see the new builds coming back in. That is visible in the order book, not this year, but if you look at 2027, 2028, 2029, we are seeing actually a pickup in new builds, particularly in China. There is a, let's say, a small wave of new builds coming in there ahead of, their peak carbon year in 2030. We're not seeing a recovery yet this year, Christian. We are bottoming out. We are actually quite optimistic for the years after that. We should see a recovery in Catalysts. If you look right now at our order book, and also what we basically saw last year, is still of the orders, it's by and large a refill business. if you look right now at our order book and also what we basically saw last year is still of the orders it's by and large a refill business The new build has dropped to roughly 10% of our orders. the new build has dropped to roughly 10% of our orders For us to really see a big recovery in catalysts, we should see the new builds coming back in. for us to really see a big recovery in catalysts we should see the new builds coming back in That is visible in the order book, not this year, but if you look at 2027, 2028, 2029, we are seeing actually a pickup in new builds, particularly in China. that is visible in the order book not this year but if you look at 2027 2028 2029 we are seeing actually a pickup in new builds particularly in china There is a, let's say, a small wave of new builds coming in there ahead of, their peak carbon year in 2030. there is a let's say a small wave of new builds coming in there ahead of their peak carbon year in 2030 We're not seeing a recovery yet this year, Christian. we're not seeing a recovery yet this year christian We are bottoming out. we are bottoming out We are actually quite optimistic for the years after that. we are actually quite optimistic for the years after that We should see a recovery in Catalysts. we should see a recovery in catalysts

Speaker 4: Okay, thanks, very helpful. Okay, thanks, very helpful. okay thanks very helpful

Speaker 5: Thank you. Thank you. thank you

Speaker 11: The next question comes from Christian Bell, from UBS. Please go ahead. The next question comes from Christian Bell, from UBS. the next question comes from christian bell from ubs Please go ahead. please go ahead

Speaker 3: Hello, good morning. I've got two questions, please. My first one is, how should we think about the earnings phasing in 2026? Are you sort of expecting a softer first quarter, then a stronger second half as savings and volumes build? If you could provide a loose guide for first quarter 2026, that would be really useful. The second question, if you could just help me, I'm a little bit confused on your 2026 guidance. Hello, good morning. hello good morning I've got two questions, please. i've got two questions please My first one is, how should we think about the earnings phasing in 2026? my first one is how should we think about the earnings phasing in 2026 Are you sort of expecting a softer first quarter, then a stronger second half as savings and volumes build? are you sort of expecting a softer first quarter then a stronger second half as savings and volumes build If you could provide a loose guide for first quarter 2026, that would be really useful. if you could provide a loose guide for first quarter 2026 that would be really useful The second question, if you could just help me, I'm a little bit confused on your 2026 guidance. the second question if you could just help me i'm a little bit confused on your 2026 guidance You're basically guiding the top line down 3%-5% on currency, which is similar to the outcome in 2025. Last year, you still expanded EBITDA margins by 180 basis points, with CHF 50 million of cost out. With another CHF 30 million planned for 2026, and a similar top line result, what's preventing any margin improvement this time around? Like, what's the difference from 2026 versus 2025 that stops you repeating that same margin progression? Thank you. You're basically guiding the top line down 3%-5% on currency, which is similar to the outcome in 2025. you're basically guiding the top line down 3%-5% on currency which is similar to the outcome in 2025 Last year, you still expanded EBITDA margins by 180 basis points, with CHF 50 million of cost out. last year you still expanded ebitda margins by 180 basis points with chf 50 million of cost out With another CHF 30 million planned for 2026, and a similar top line result, what's preventing any margin improvement this time around? with another chf 30 million planned for 2026 and a similar top line result what's preventing any margin improvement this time around Like, what's the difference from 2026 versus 2025 that stops you repeating that same margin progression? like what's the difference from 2026 versus 2025 that stops you repeating that same margin progression Thank you. thank you

Speaker 5: Okay, Christian, I'll take the first question on phasing. Oliver will provide some more granularity on your second question. As far as the phasing throughout the year, I think we should keep in mind that we had last year, actually, a strong first quarter. Other than that, if you sort of ignore the year-on-year comp, we are seeing a fairly normal pattern throughout the year. It's not that we see a significant recovery in H2 versus H1, like we sometimes had in other years in the outlook. What is important may be some specific comments in Care Chemicals. We see, at the moment, nothing unusual. De-icing is obviously playing a role there in how Q1 will come in. Okay, Christian, I'll take the first question on phasing. okay christian i'll take the first question on phasing Oliver will provide some more granularity on your second question. oliver will provide some more granularity on your second question As far as the phasing throughout the year, I think we should keep in mind that we had last year, actually, a strong first quarter. as far as the phasing throughout the year i think we should keep in mind that we had last year actually a strong first quarter Other than that, if you sort of ignore the year-on-year comp, we are seeing a fairly normal pattern throughout the year. other than that if you sort of ignore the year-on-year comp we are seeing a fairly normal pattern throughout the year It's not that we see a significant recovery in H2 versus H1, like we sometimes had in other years in the outlook. it's not that we see a significant recovery in h2 versus h1 like we sometimes had in other years in the outlook What is important may be some specific comments in Care Chemicals. what is important may be some specific comments in care chemicals We see, at the moment, nothing unusual. we see at the moment nothing unusual De-icing is obviously playing a role there in how Q1 will come in. de-icing is obviously playing a role there in how q1 will come in In Catalysts, we are comparing against a strong quarter last year, but normally, we always see a weak Q1, as we also saw last year, after a strong Q4. There is that sequential effect. In Adsorbents & Additives, we are seeing a somewhat weaker start in Adsorbents, where we still are waiting for the regulation for renewables to kick in. The EPA has set ambitious targets for renewable diesel and SAF, but these need to be still endorsed by Congress, and because of the government shutdowns, there's a delay in that. You see that the market expects these increased targets to kick in, because RIN prices are going up, but we're not seeing that in our numbers yet. Other than that, I think there's nothing here to comment. Yeah, Oliver, to you. In Catalysts, we are comparing against a strong quarter last year, but normally, we always see a weak Q1, as we also saw last year, after a strong Q4. in catalysts we are comparing against a strong quarter last year but normally we always see a weak q1 as we also saw last year after a strong q4 There is that sequential effect. there is that sequential effect In Adsorbents & Additives, we are seeing a somewhat weaker start in Adsorbents, where we still are waiting for the regulation for renewables to kick in. in adsorbents & additives we are seeing a somewhat weaker start in adsorbents where we still are waiting for the regulation for renewables to kick in The EPA has set ambitious targets for renewable diesel and SAF, but these need to be still endorsed by Congress, and because of the government shutdowns, there's a delay in that. the epa has set ambitious targets for renewable diesel and saf but these need to be still endorsed by congress and because of the government shutdowns there's a delay in that You see that the market expects these increased targets to kick in, because RIN prices are going up, but we're not seeing that in our numbers yet. you see that the market expects these increased targets to kick in because rin prices are going up but we're not seeing that in our numbers yet Other than that, I think there's nothing here to comment. other than that i think there's nothing here to comment Yeah, Oliver, to you. yeah oliver to you

Speaker 10: Hi, Christian. Let me comment on your second question on margin progression year-over-year. I mean, first of all, as you have seen, there's a strong progression from 2024 to 2025, with 180 basis points of improvement, which brought us now to 17.8%. That was driven by the performance improvement programs, the cost productivity, and effective price management, as we said. Of course, and we had a flat top line at this. For 2026, we are guiding for now a second year of flat top line, with the effects that we alluded to before, the pruning that needs to be compensated and the soft market environment. Hi, Christian. hi christian Let me comment on your second question on margin progression year-over-year. let me comment on your second question on margin progression year-over-year I mean, first of all, as you have seen, there's a strong progression from 2024 to 2025, with 180 basis points of improvement, which brought us now to 17.8%. i mean first of all as you have seen there's a strong progression from 2024 to 2025 with 180 basis points of improvement which brought us now to 17.8% That was driven by the performance improvement programs, the cost productivity, and effective price management, as we said. that was driven by the performance improvement programs the cost productivity and effective price management as we said Of course, and we had a flat top line at this. of course and we had a flat top line at this For 2026, we are guiding for now a second year of flat top line, with the effects that we alluded to before, the pruning that needs to be compensated and the soft market environment. for 2026 we are guiding for now a second year of flat top line with the effects that we alluded to before the pruning that needs to be compensated and the soft market environment Again, we are executing now on the performance program, delivering further savings in 2026. At the same time, of course, in 2026, like in 2025, we need to compensate for the inflation that is happening in the cost structures that we do have. We guided for 2026, that we have 3%-4% inflation in the cost structure. We have the savings from the savings programs, plus other productivity measures that we're taking, and hence, we guided for around 18%. Of course, the ambition here is to make further progress also towards our medium-term targets. As we alluded to for 2027, that it requires also a bit of a rebound of growth that we, that we then bring it really in. Again, we are executing now on the performance program, delivering further savings in 2026. again we are executing now on the performance program delivering further savings in 2026 At the same time, of course, in 2026, like in 2025, we need to compensate for the inflation that is happening in the cost structures that we do have. at the same time of course in 2026 like in 2025 we need to compensate for the inflation that is happening in the cost structures that we do have We guided for 2026, that we have 3%-4% inflation in the cost structure. we guided for 2026 that we have 3%-4% inflation in the cost structure We have the savings from the savings programs, plus other productivity measures that we're taking, and hence, we guided for around 18%. we have the savings from the savings programs plus other productivity measures that we're taking and hence we guided for around 18% Of course, the ambition here is to make further progress also towards our medium-term targets. of course the ambition here is to make further progress also towards our medium-term targets As we alluded to for 2027, that it requires also a bit of a rebound of growth that we, that we then bring it really in. as we alluded to for 2027 that it requires also a bit of a rebound of growth that we that we then bring it really in

Speaker 3: Okay. It just seemed like a similar setup in 2026, with a similar level of cost out. You're basically saying that your underlying inflation, your underlying cost inflation this year is much stronger than it was. Well, you're expecting it to be much stronger this year than it was in 2025? Okay. okay It just seemed like a similar setup in 2026, with a similar level of cost out. it just seemed like a similar setup in 2026 with a similar level of cost out You're basically saying that your underlying inflation, your underlying cost inflation this year is much stronger than it was. you're basically saying that your underlying inflation your underlying cost inflation this year is much stronger than it was Well, you're expecting it to be much stronger this year than it was in 2025? well you're expecting it to be much stronger this year than it was in 2025

Speaker 10: No, the, I mean, there is another year of inflation. I think, Christian, the point is more, we did 180 basis points last year, where we set the organization on a leaner base, and obviously the savings were also a bit higher in 2025 versus 2026, and that's partially driving that effect. No, the, I mean, there is another year of inflation. no the i mean there is another year of inflation I think, Christian, the point is more, we did 180 basis points last year, where we set the organization on a leaner base, and obviously the savings were also a bit higher in 2025 versus 2026, and that's partially driving that effect. i think christian the point is more we did 180 basis points last year where we set the organization on a leaner base and obviously the savings were also a bit higher in 2025 versus 2026 and that's partially driving that effect

Speaker 3: Okay, thank you. Okay, thank you. okay thank you

Speaker 10: You're welcome. You're welcome. you're welcome

Speaker 11: The next question comes from Katie Richards, from Barclays. Please go ahead. The next question comes from Katie Richards, from Barclays. the next question comes from katie richards from barclays Please go ahead. please go ahead

Speaker 8: Hi. Yes, good afternoon. I had a question on the use of capital and the balance sheet. You were on Bloomberg this morning, Conrad, and mentioned that Clariant would be open to bolt-on acquisitions, essentially on the scale of Lucas Meyer Cosmetics. You're also, at the same time, targeting CapEx potentially as low as CHF 150 million. A few questions on this then. With leverage coming down and proceeds also coming from Star, which end markets would you be interested in exploring further? Could you also remind us how much you're spending annually for maintenance purposes, please? Finally, how are you looking to balance organic growth versus paying a premium to promote the growth? Hi. hi Yes, good afternoon. yes good afternoon I had a question on the use of capital and the balance sheet. i had a question on the use of capital and the balance sheet You were on Bloomberg this morning, Conrad, and mentioned that Clariant would be open to bolt-on acquisitions, essentially on the scale of Lucas Meyer Cosmetics. you were on bloomberg this morning conrad and mentioned that clariant would be open to bolt-on acquisitions essentially on the scale of lucas meyer cosmetics You're also, at the same time, targeting CapEx potentially as low as CHF 150 million. you're also at the same time targeting capex potentially as low as chf 150 million A few questions on this then. a few questions on this then With leverage coming down and proceeds also coming from Star, which end markets would you be interested in exploring further? with leverage coming down and proceeds also coming from star which end markets would you be interested in exploring further Could you also remind us how much you're spending annually for maintenance purposes, please? could you also remind us how much you're spending annually for maintenance purposes please Finally, how are you looking to balance organic growth versus paying a premium to promote the growth? finally how are you looking to balance organic growth versus paying a premium to promote the growth

Speaker 5: Yeah, Katie, maybe first, to clarify on comments made this morning on the calls. Yeah, there's nothing new. We're always open for bolt-on acquisitions, but we also said this morning that our first priority is always organic growth, and margin improvement. Then, if we can complement that with the right bolt-on acquisitions, we're very open to that, and we defined as the right ones, acquisitions that really fit to our core segments, and that provide real synergy. Then I mentioned Lucas Meyer as a great example of an acquisition that basically fits those criteria in the past, but that's not to say that there is, right now, a target, of that size available. Just to be clear about that. Yeah, Katie, maybe first, to clarify on comments made this morning on the calls. yeah katie maybe first to clarify on comments made this morning on the calls Yeah, there's nothing new. yeah there's nothing new We're always open for bolt-on acquisitions, but we also said this morning that our first priority is always organic growth, and margin improvement. we're always open for bolt-on acquisitions but we also said this morning that our first priority is always organic growth and margin improvement Then, if we can complement that with the right bolt-on acquisitions, we're very open to that, and we defined as the right ones, acquisitions that really fit to our core segments, and that provide real synergy. then if we can complement that with the right bolt-on acquisitions we're very open to that and we defined as the right ones acquisitions that really fit to our core segments and that provide real synergy Then I mentioned Lucas Meyer as a great example of an acquisition that basically fits those criteria in the past, but that's not to say that there is, right now, a target, of that size available. then i mentioned lucas meyer as a great example of an acquisition that basically fits those criteria in the past but that's not to say that there is right now a target of that size available Just to be clear about that. just to be clear about that Overall, people do expect, with limited growth perspectives right now in the chemical industry, that there should be an increased level of potential consolidation ahead of us. What I said this morning is it's important that we obviously participate in industry consolidation, if and when that happens. As far as CapEx maintenance, that's fairly steady at roughly a level of CHF 100 million a year. You see the big reduction in CapEx for us from the fact that we haven't actually added to our footprint, particularly in China, in recent years, and now actually we're very well set up there. Keep in mind, in recent years, we invested CHF 80 million in a new catalyst plant that came up on stream. We invested CHF 80 million last year in a new surfactant plant in Daya Bay that came up on stream. Overall, people do expect, with limited growth perspectives right now in the chemical industry, that there should be an increased level of potential consolidation ahead of us. overall people do expect with limited growth perspectives right now in the chemical industry that there should be an increased level of potential consolidation ahead of us What I said this morning is it's important that we obviously participate in industry consolidation, if and when that happens. what i said this morning is it's important that we obviously participate in industry consolidation if and when that happens As far as CapEx maintenance, that's fairly steady at roughly a level of CHF 100 million a year. as far as capex maintenance that's fairly steady at roughly a level of chf 100 million a year You see the big reduction in CapEx for us from the fact that we haven't actually added to our footprint, particularly in China, in recent years, and now actually we're very well set up there. you see the big reduction in capex for us from the fact that we haven't actually added to our footprint particularly in china in recent years and now actually we're very well set up there Keep in mind, in recent years, we invested CHF 80 million in a new catalyst plant that came up on stream. keep in mind in recent years we invested chf 80 million in a new catalyst plant that came up on stream We invested CHF 80 million last year in a new surfactant plant in Daya Bay that came up on stream. we invested chf 80 million last year in a new surfactant plant in daya bay that came up on stream We invested last year, we completed actually the investment of two lines for flame retardants. That was another CHF 100 million. If you look at those items alone, that explains why the CapEx envelope is structurally lower than it was in the past. We haven't cut any corners on maintenance CapEx, so no worries there. That's at a fairly steady level, around roughly CHF 100 million a year. We invested last year, we completed actually the investment of two lines for flame retardants. we invested last year we completed actually the investment of two lines for flame retardants That was another CHF 100 million. that was another chf 100 million If you look at those items alone, that explains why the CapEx envelope is structurally lower than it was in the past. if you look at those items alone that explains why the capex envelope is structurally lower than it was in the past We haven't cut any corners on maintenance CapEx, so no worries there. we haven't cut any corners on maintenance capex so no worries there That's at a fairly steady level, around roughly CHF 100 million a year. that's at a fairly steady level around roughly chf 100 million a year

Speaker 8: Thank you. Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 11: The next question comes from Michael Schaefer from Oddo BHF. Please go ahead. The next question comes from Michael Schaefer from Oddo BHF. the next question comes from michael schaefer from oddo bhf Please go ahead. please go ahead

Speaker 9: Yeah, thanks for taking my two questions. On one end, first one, I wanna come back to your Catalysts outlook for 2026. As you said, you guide for flat local currency sales into 2026. Nevertheless, you also reported on some greenfield projects helping you to record what we haven't seen for quite some time, this kind of EBITDA level in the fourth quarter, and I think also on the full year, the 20.8% margin was rather unique over the past four or five years, so to say. Yeah, thanks for taking my two questions. yeah thanks for taking my two questions On one end, first one, I wanna come back to your Catalysts outlook for 2026. on one end first one i wanna come back to your catalysts outlook for 2026 As you said, you guide for flat local currency sales into 2026. as you said you guide for flat local currency sales into 2026 Nevertheless, you also reported on some greenfield projects helping you to record what we haven't seen for quite some time, this kind of EBITDA level in the fourth quarter, and I think also on the full year, the 20.8% margin was rather unique over the past four or five years, so to say. nevertheless you also reported on some greenfield projects helping you to record what we haven't seen for quite some time this kind of ebitda level in the fourth quarter and i think also on the full year the 20.8% margin was rather unique over the past four or five years so to say I wonder, how should we think about mix effect into 2026, and how margin is progressing in the Catalysts segment? This would be my first question. on the cash flow in 2026. You built up some working capital, quite sizable, in 2025, maybe a bit of a surprise here, talking also about phasing effects. How should we think about the measures you are implementing, and what do you expect in 2026 in terms of working capital? Thanks I wonder, how should we think about mix effect into 2026, and how margin is progressing in the Catalysts segment? i wonder how should we think about mix effect into 2026 and how margin is progressing in the catalysts segment This would be my first question. on the cash flow in 2026. this would be my first question on the cash flow in 2026 You built up some working capital, quite sizable, in 2025, maybe a bit of a surprise here, talking also about phasing effects. you built up some working capital quite sizable in 2025 maybe a bit of a surprise here talking also about phasing effects How should we think about the measures you are implementing, and what do you expect in 2026 in terms of working capital? how should we think about the measures you are implementing and what do you expect in 2026 in terms of working capital Thanks thanks

Speaker 5: Yeah. I will answer the question on margins and mix outlook for Catalysts and also we'll provide some clarity on working capital movements. If you look at Catalysts and the performance that we saw, we're very pleased that in these new builds that is out there, that we're getting it. That is, I think, very positive. Particularly on ethylene, there is actually a large project in Europe that is starting up early next year. We see actually the first sale order for that coming in. That is, that's very positive. We also saw, if you look at syngas and ethylene, we saw actually that both of these segments are performing well on refill. Yeah. yeah I will answer the question on margins and mix outlook for Catalysts and also we'll provide some clarity on working capital movements. i will answer the question on margins and mix outlook for catalysts and also we'll provide some clarity on working capital movements If you look at Catalysts and the performance that we saw, we're very pleased that in these new builds that is out there, that we're getting it. if you look at catalysts and the performance that we saw we're very pleased that in these new builds that is out there that we're getting it That is, I think, very positive. that is i think very positive Particularly on ethylene, there is actually a large project in Europe that is starting up early next year. particularly on ethylene there is actually a large project in europe that is starting up early next year We see actually the first sale order for that coming in. we see actually the first sale order for that coming in That is, that's very positive. that is that's very positive We also saw, if you look at syngas and ethylene, we saw actually that both of these segments are performing well on refill. we also saw if you look at syngas and ethylene we saw actually that both of these segments are performing well on refill We have a full share on new builds, and if it's about refill, we think that particularly on syngas, we've gained some share. If you look at our margins, they are reflecting that as well. There is the very positive effects from the cost outs, also in Catalysts, but there's also underlying a structural improvement in mix. What you see is, in Catalysts, with rising prices for metals, it is not an easy environment. You may have seen the profitability reports of some of our competitors that show EBITDA margins significantly down. We have a full share on new builds, and if it's about refill, we think that particularly on syngas, we've gained some share. we have a full share on new builds and if it's about refill we think that particularly on syngas we've gained some share If you look at our margins, they are reflecting that as well. if you look at our margins they are reflecting that as well There is the very positive effects from the cost outs, also in Catalysts, but there's also underlying a structural improvement in mix. there is the very positive effects from the cost outs also in catalysts but there's also underlying a structural improvement in mix What you see is, in Catalysts, with rising prices for metals, it is not an easy environment. what you see is in catalysts with rising prices for metals it is not an easy environment You may have seen the profitability reports of some of our competitors that show EBITDA margins significantly down. you may have seen the profitability reports of some of our competitors that show ebitda margins significantly down We're actually very pleased with the results in Catalysts, with a 21% EBITDA margin for the year. But to further step up the margin in a significant way, in the year ahead of us, that is still requires a pickup. That still would require a pickup in new builds, and that is not yet what we see for this year. We see that more for 2027. We're actually very pleased with the results in Catalysts, with a 21% EBITDA margin for the year. we're actually very pleased with the results in catalysts with a 21% ebitda margin for the year But to further step up the margin in a significant way, in the year ahead of us, that is still requires a pickup. but to further step up the margin in a significant way in the year ahead of us that is still requires a pickup That still would require a pickup in new builds, and that is not yet what we see for this year. that still would require a pickup in new builds and that is not yet what we see for this year We see that more for 2027. we see that more for 2027

Speaker 10: Hi, Michael. On working capital and cash, let me first start from the broader picture of cash. I mean, we are very satisfied with the cash performance overall that we had in 2025. 10 percentage points of cash conversion up versus previous year, CHF 80 million better operational cash flow performance. Indeed, we had a bit of a build up in net working capital that we then also compensated with very disciplined CapEx management. That build up in net working capital in the fourth quarter is also a bit related to the phasing or the sales pattern that we have seen in the fourth quarter. Hi, Michael. hi michael On working capital and cash, let me first start from the broader picture of cash. on working capital and cash let me first start from the broader picture of cash I mean, we are very satisfied with the cash performance overall that we had in 2025. 10 percentage points of cash conversion up versus previous year, CHF 80 million better operational cash flow performance. i mean we are very satisfied with the cash performance overall that we had in 2025 10 percentage points of cash conversion up versus previous year chf 80 million better operational cash flow performance Indeed, we had a bit of a build up in net working capital that we then also compensated with very disciplined CapEx management. indeed we had a bit of a build up in net working capital that we then also compensated with very disciplined capex management That build up in net working capital in the fourth quarter is also a bit related to the phasing or the sales pattern that we have seen in the fourth quarter. that build up in net working capital in the fourth quarter is also a bit related to the phasing or the sales pattern that we have seen in the fourth quarter We had a very strong December in Catalysts, but also in Care with the Aviation business. I mean, obviously, with the payment terms that you have then on these sales, you have a bit of a build up of accounts receivables. We also have slowed down on inventory build up in AMA, which had an impact on accounts payable. We had a couple of effects at the end of Q4. We had a very strong December in Catalysts, but also in Care with the Aviation business. we had a very strong december in catalysts but also in care with the aviation business I mean, obviously, with the payment terms that you have then on these sales, you have a bit of a build up of accounts receivables. i mean obviously with the payment terms that you have then on these sales you have a bit of a build up of accounts receivables We also have slowed down on inventory build up in AMA, which had an impact on accounts payable. we also have slowed down on inventory build up in ama which had an impact on accounts payable We had a couple of effects at the end of Q4. we had a couple of effects at the end of q4

Speaker 5: What we have done independent of that particular quarter is that we initiated a cash program in Clariant where we structurally will look into the different net working capital levels. It's an integrated approach across the business units. It's ingrained in the target setting that we have on a segment level. It's a clear focus area. You have seen it also with our triangle, to say, growth, margin, cash. That's what we focus on. That is what drives our differentiated steering. There's a focus on net working capital and to drive that down in 2026. What we have done independent of that particular quarter is that we initiated a cash program in Clariant where we structurally will look into the different net working capital levels. what we have done independent of that particular quarter is that we initiated a cash program in clariant where we structurally will look into the different net working capital levels It's an integrated approach across the business units. it's an integrated approach across the business units It's ingrained in the target setting that we have on a segment level. it's ingrained in the target setting that we have on a segment level It's a clear focus area. it's a clear focus area You have seen it also with our triangle, to say, growth, margin, cash. you have seen it also with our triangle to say growth margin cash That's what we focus on. that's what we focus on That is what drives our differentiated steering. that is what drives our differentiated steering There's a focus on net working capital and to drive that down in 2026. there's a focus on net working capital and to drive that down in 2026

Speaker 11: The next question comes from Julia Winckelmann from Bank of America. Please go ahead. The next question comes from Julia Winckelmann from Bank of America. the next question comes from julia winckelmann from bank of america Please go ahead. please go ahead

Speaker 7: Hi. Thanks for taking my question. I was wondering, you finished the year ahead of schedule on your cost savings target and also achieved your cash conversion target already. Given this progress, do you plan to update your midterm targets and perhaps also give an update on how to think about your capital allocation going forward, given the stronger cash generation? Hi. hi Thanks for taking my question. thanks for taking my question I was wondering, you finished the year ahead of schedule on your cost savings target and also achieved your cash conversion target already. i was wondering you finished the year ahead of schedule on your cost savings target and also achieved your cash conversion target already Given this progress, do you plan to update your midterm targets and perhaps also give an update on how to think about your capital allocation going forward, given the stronger cash generation? given this progress do you plan to update your midterm targets and perhaps also give an update on how to think about your capital allocation going forward given the stronger cash generation

Speaker 5: Yeah, Julia, that's a great question, and we are obviously very happy with and pleased with how we finished the year in terms of our EBITDA margin being up 180 basis points and our cash conversion being up 10 points to slightly over 40% conversion now. Where we are versus the midterm targets is that indeed, for cash conversion, we have achieved these targets already. It's fair to say that we still have a bridge from 17.8% to the bottom range, which was 19%-21% EBITDA margin. I will say, we look at three years in a row now of improvement, annual improvement in EBITDA margins, as well as absolute EBITDA. We came from 14.6%. We're now at 17.8%. Yeah, Julia, that's a great question, and we are obviously very happy with and pleased with how we finished the year in terms of our EBITDA margin being up 180 basis points and our cash conversion being up 10 points to slightly over 40% conversion now. yeah julia that's a great question and we are obviously very happy with and pleased with how we finished the year in terms of our ebitda margin being up 180 basis points and our cash conversion being up 10 points to slightly over 40% conversion now Where we are versus the midterm targets is that indeed, for cash conversion, we have achieved these targets already. where we are versus the midterm targets is that indeed for cash conversion we have achieved these targets already It's fair to say that we still have a bridge from 17.8% to the bottom range, which was 19%-21% EBITDA margin. it's fair to say that we still have a bridge from 17.8% to the bottom range which was 19%-21% ebitda margin I will say, we look at three years in a row now of improvement, annual improvement in EBITDA margins, as well as absolute EBITDA. i will say we look at three years in a row now of improvement annual improvement in ebitda margins as well as absolute ebitda We came from 14.6%. we came from 14.6% We're now at 17.8%. we're now at 17.8% That was certainly in a challenging market environment for us now to revisit the midterm targets, that's not on the agenda. We're very much focused on delivering them. We are very much focused to have all the levers in place to bridge towards the 19%-21% EBITDA margin, that is the differentiated growth strategy. It's repositioning the businesses to more profitable segments. It is finishing the cost out program, as Oliver has alluded to. It is maintaining pricing discipline, with that, we think we have the levers in place in addition to a pickup in markets that we do anticipate for 2027. We have all the levers in place to deliver the 19%-21%. Yeah, that is, those are actually quite ambitious targets, in the current environment. That was certainly in a challenging market environment for us now to revisit the midterm targets, that's not on the agenda. that was certainly in a challenging market environment for us now to revisit the midterm targets that's not on the agenda We're very much focused on delivering them. we're very much focused on delivering them We are very much focused to have all the levers in place to bridge towards the 19%-21% EBITDA margin, that is the differentiated growth strategy. we are very much focused to have all the levers in place to bridge towards the 19%-21% ebitda margin that is the differentiated growth strategy It's repositioning the businesses to more profitable segments. it's repositioning the businesses to more profitable segments It is finishing the cost out program, as Oliver has alluded to. it is finishing the cost out program as oliver has alluded to It is maintaining pricing discipline, with that, we think we have the levers in place in addition to a pickup in markets that we do anticipate for 2027. it is maintaining pricing discipline with that we think we have the levers in place in addition to a pickup in markets that we do anticipate for 2027 We have all the levers in place to deliver the 19%-21%. we have all the levers in place to deliver the 19%-21% Yeah, that is, those are actually quite ambitious targets, in the current environment. yeah that is those are actually quite ambitious targets in the current environment

Speaker 7: Thank you. Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 11: The next question comes from Tristan Lamotte from Deutsche Bank. Please go ahead. The next question comes from Tristan Lamotte from Deutsche Bank. the next question comes from tristan lamotte from deutsche bank Please go ahead. please go ahead

Speaker 13: Hi, thanks. Two questions, please. The first is, could you maybe just run through your end markets and the trends and outlook that you see in those, so in agriculture, autos, construction, electronics, et cetera? Can I ask a general question about your view on the threats to European specialty chemicals companies from China? Do you still think that European chemical companies have sustainable moats in specialty chemicals, and to what extent are you seeing Chinese competition moving into specialties so far, and to what extent do you expect that to accelerate over the next 10 years? Thanks. Hi, thanks. hi thanks Two questions, please. two questions please The first is, could you maybe just run through your end markets and the trends and outlook that you see in those, so in agriculture, autos, construction, electronics, et cetera? the first is could you maybe just run through your end markets and the trends and outlook that you see in those so in agriculture autos construction electronics et cetera Can I ask a general question about your view on the threats to European specialty chemicals companies from China? can i ask a general question about your view on the threats to european specialty chemicals companies from china Do you still think that European chemical companies have sustainable moats in specialty chemicals, and to what extent are you seeing Chinese competition moving into specialties so far, and to what extent do you expect that to accelerate over the next 10 years? do you still think that european chemical companies have sustainable moats in specialty chemicals and to what extent are you seeing chinese competition moving into specialties so far and to what extent do you expect that to accelerate over the next 10 years Thanks. thanks

Speaker 5: Yeah, sure. These are important questions. First on end markets, what we are seeing. Well, first of all, let me start with Care Chemicals. We see, in general, the consumer-facing segments with a robust demand. If you look at personal care, home care, that is basically low to mid-single digit growth, with a bit more growth in personal care in the premium segments, like skincare, haircare. Really the premium products, the level just under that, there is actually some downtrading, the so-called aspirational buyers. Home care, very solid and robust laundry, things like that. Crop Protection, we've had interesting years behind us. Yeah, sure. yeah sure These are important questions. these are important questions First on end markets, what we are seeing. first on end markets what we are seeing Well, first of all, let me start with Care Chemicals. well first of all let me start with care chemicals We see, in general, the consumer-facing segments with a robust demand. we see in general the consumer-facing segments with a robust demand If you look at personal care, home care, that is basically low to mid-single digit growth, with a bit more growth in personal care in the premium segments, like skincare, haircare. if you look at personal care home care that is basically low to mid-single digit growth with a bit more growth in personal care in the premium segments like skincare haircare Really the premium products, the level just under that, there is actually some downtrading, the so-called aspirational buyers. really the premium products the level just under that there is actually some downtrading the so-called aspirational buyers Home care, very solid and robust laundry, things like that. home care very solid and robust laundry things like that Crop Protection, we've had interesting years behind us. crop protection we've had interesting years behind us Last year, we had a strong year in Crop Protection, but that was really very much because the year before, we had still the destocking, so it was also, let's say, some of the year-on-year comparisons. I think now we have a much cleaner comparison, and we should more trade in line with historic levels, where we sort of, yeah, slightly we outperform GDP levels. Oil and gas, it's basically a relatively modest outlook right now. Oil prices, yeah, now they're up to $70 because of the geopolitical turmoil in the Middle East, but In reality, there's plenty of supply, and more so than demand, so it's not an environment with how high oil prices or a lot of investments that we are seeing there. Last year, we had a strong year in Crop Protection, but that was really very much because the year before, we had still the destocking, so it was also, let's say, some of the year-on-year comparisons. last year we had a strong year in crop protection but that was really very much because the year before we had still the destocking so it was also let's say some of the year-on-year comparisons I think now we have a much cleaner comparison, and we should more trade in line with historic levels, where we sort of, yeah, slightly we outperform GDP levels. i think now we have a much cleaner comparison and we should more trade in line with historic levels where we sort of yeah slightly we outperform gdp levels Oil and gas, it's basically a relatively modest outlook right now. oil and gas it's basically a relatively modest outlook right now Oil prices, yeah, now they're up to $70 because of the geopolitical turmoil in the Middle East, but In reality, there's plenty of supply, and more so than demand, so it's not an environment with how high oil prices or a lot of investments that we are seeing there. oil prices yeah now they're up to $70 because of the geopolitical turmoil in the middle east but in reality there's plenty of supply and more so than demand so it's not an environment with how high oil prices or a lot of investments that we are seeing there Mining continues to be positive, especially for items like copper and steel, and lithium. Catalysts, we still globally run 70%-80% util rates. For us, really to see new builds kicking in, we need to go first to higher utilization levels. I did mention China as one, where 2027, 2028, 2029, we are seeing new builds coming back in. For this year, it is really a bottoming out year in Catalysts in our forecast. Finally, Additives and Adsorbents. What we see actually is relatively weak demand, if you look at electronics and particularly smartphones, but that was already the case last year. Mining continues to be positive, especially for items like copper and steel, and lithium. mining continues to be positive especially for items like copper and steel and lithium Catalysts, we still globally run 70%-80% util rates. catalysts we still globally run 70%-80% util rates For us, really to see new builds kicking in, we need to go first to higher utilization levels. for us really to see new builds kicking in we need to go first to higher utilization levels I did mention China as one, where 2027, 2028, 2029, we are seeing new builds coming back in. i did mention china as one where 2027 2028 2029 we are seeing new builds coming back in For this year, it is really a bottoming out year in Catalysts in our forecast. for this year it is really a bottoming out year in catalysts in our forecast Finally, Additives and Adsorbents. finally additives and adsorbents What we see actually is relatively weak demand, if you look at electronics and particularly smartphones, but that was already the case last year. what we see actually is relatively weak demand if you look at electronics and particularly smartphones but that was already the case last year Actually, there's a certain level of maturity here, with very low single digits rates for growth for smartphones. PC production was actually quite nicely up last year. We think that will continue to be relatively okay. Finally, if you look at our Additives business, and markets like furniture, we had expected a big recovery there last year already, as consumers, at some point, should spend on durable goods again, or semi-durables, but it hasn't happened yet. For this year, so far, we're not seeing that either. To finish it all off with Adsorbents, this is very much for us, driven by renewable diesel, now, sustainable Aviation fuel. Actually, there's a certain level of maturity here, with very low single digits rates for growth for smartphones. actually there's a certain level of maturity here with very low single digits rates for growth for smartphones PC production was actually quite nicely up last year. pc production was actually quite nicely up last year We think that will continue to be relatively okay. we think that will continue to be relatively okay Finally, if you look at our Additives business, and markets like furniture, we had expected a big recovery there last year already, as consumers, at some point, should spend on durable goods again, or semi-durables, but it hasn't happened yet. finally if you look at our additives business and markets like furniture we had expected a big recovery there last year already as consumers at some point should spend on durable goods again or semi-durables but it hasn't happened yet For this year, so far, we're not seeing that either. for this year so far we're not seeing that either To finish it all off with Adsorbents, this is very much for us, driven by renewable diesel, now, sustainable Aviation fuel. to finish it all off with adsorbents this is very much for us driven by renewable diesel now sustainable aviation fuel In Europe, there are mandates in place, but in the U.S., we're still waiting for the endorsement by Congress for the new increased EPA targets, but that should come at some point in the year. Overall, if you summarized it's a very modest sort of growth environment overall, and with some differences by region. Maybe specifically on your second question on China, and how is this impacting specialty chemicals? I think there is a big difference between commodity and petrochemicals on the one hand, and specialty chemicals on the other side. In China, there is significant capacity being built up in recent years for commodity chemicals, for petrochemicals. In specialty chemicals, we are not seeing that level of competition in China. In Europe, there are mandates in place, but in the U.S., we're still waiting for the endorsement by Congress for the new increased EPA targets, but that should come at some point in the year. in europe there are mandates in place but in the u.s we're still waiting for the endorsement by congress for the new increased epa targets but that should come at some point in the year Overall, if you summarized it's a very modest sort of growth environment overall, and with some differences by region. overall if you summarized it's a very modest sort of growth environment overall and with some differences by region Maybe specifically on your second question on China, and how is this impacting specialty chemicals? maybe specifically on your second question on china and how is this impacting specialty chemicals I think there is a big difference between commodity and petrochemicals on the one hand, and specialty chemicals on the other side. i think there is a big difference between commodity and petrochemicals on the one hand and specialty chemicals on the other side In China, there is significant capacity being built up in recent years for commodity chemicals, for petrochemicals. in china there is significant capacity being built up in recent years for commodity chemicals for petrochemicals In specialty chemicals, we are not seeing that level of competition in China. in specialty chemicals we are not seeing that level of competition in china I mean, this is based on IP that took decades to develop. Actually, what we see is that for our business, we make good margins in China. There is a shift where we increasingly supply to local Chinese companies. I think high level, the other big impact that China has is historically, Europe was exporting a significant part of its production into China, the same with the U.S. That has come down significantly, and China has become an exporter for some items, but not so much in specialty chemicals again, it's much more on the commodity side. I mean, this is based on IP that took decades to develop. i mean this is based on ip that took decades to develop Actually, what we see is that for our business, we make good margins in China. actually what we see is that for our business we make good margins in china There is a shift where we increasingly supply to local Chinese companies. there is a shift where we increasingly supply to local chinese companies I think high level, the other big impact that China has is historically, Europe was exporting a significant part of its production into China, the same with the U.S. i think high level the other big impact that china has is historically europe was exporting a significant part of its production into china the same with the u.s That has come down significantly, and China has become an exporter for some items, but not so much in specialty chemicals again, it's much more on the commodity side. that has come down significantly and china has become an exporter for some items but not so much in specialty chemicals again it's much more on the commodity side

Speaker 13: Very helpful. Thanks. Very helpful. very helpful Thanks. thanks

Speaker 5: Thank you. Thank you. thank you

Speaker 11: The next question comes from Chetan Udeshi, from JPMorgan. Please go ahead. The next question comes from Chetan Udeshi, from JP Morgan. the next question comes from chetan udeshi from jp morgan Please go ahead. please go ahead

Speaker 2: Hi. Thanks for taking my question. I just wanted to follow up, Conrad, on your comment on industry consolidation. I'm a bit puzzled and also curious that we've not seen much happen already. You know, for Clariant, you've signaled openness to participate in any consolidation. You know, you have a very different business structure. You know, in the sense like, you know, you've got Catalysts business, you've got Care Chemicals, which is comprised of industrial plus consumer, and then, of course, you have Adsorbents & Additives. It just feels like, you know, the structure of the business is probably too complicated to see, you know, Clariant as an obvious candidate or, you know, initiator of any consolidation. I'm just curious how you think about that? Hi. hi Thanks for taking my question. thanks for taking my question I just wanted to follow up, Conrad, on your comment on industry consolidation. i just wanted to follow up conrad on your comment on industry consolidation I'm a bit puzzled and also curious that we've not seen much happen already. i'm a bit puzzled and also curious that we've not seen much happen already You know, for Clariant, you've signaled openness to participate in any consolidation. you know for clariant you've signaled openness to participate in any consolidation You know, you have a very different business structure. you know you have a very different business structure You know, in the sense like, you know, you've got Catalysts business, you've got Care Chemicals, which is comprised of industrial plus consumer, and then, of course, you have Adsorbents & Additives. you know in the sense like you know you've got catalysts business you've got care chemicals which is comprised of industrial plus consumer and then of course you have adsorbents & additives It just feels like, you know, the structure of the business is probably too complicated to see, you know, Clariant as an obvious candidate or, you know, initiator of any consolidation. it just feels like you know the structure of the business is probably too complicated to see you know clariant as an obvious candidate or you know initiator of any consolidation I'm just curious how you think about that? i'm just curious how you think about that

Speaker 5: Was it a question or an opinion that you were voicing, Chetan? Was it a question or an opinion that you were voicing, Chetan? was it a question or an opinion that you were voicing chetan

Speaker 2: It's a both. I mean, a bit of both. You know, I think it's not just for Clariant. I'm just curious, you know, is this a problem for the industry overall, that, you know? It's a both. it's a both I mean, a bit of both. i mean a bit of both You know, I think it's not just for Clariant. you know i think it's not just for clariant I'm just curious, you know, is this a problem for the industry overall, that, you know? i'm just curious you know is this a problem for the industry overall that you know

Speaker 5: Sure. Sure. sure

Speaker 2: There is no, like, pure play company that is easy to buy or easy to sell, and that makes it quite, you know, complex for industry to consider? There is no, like, pure play company that is easy to buy or easy to sell, and that makes it quite, you know, complex for industry to consider? there is no like pure play company that is easy to buy or easy to sell and that makes it quite you know complex for industry to consider

Speaker 5: No, it's an important question that you, that you're raising. If you look big picture, where we came from is we were a hybrid. Clariant was both active in commodity businesses and in specialty businesses. If you look at the recent years, we've really repositioned the business to become fully specialty. If you look at the recent, let's say, five years, what we did is in 2022, we divested our pigment business, which we clearly saw that was commoditizing. By the way, it has indeed even further commoditized, so I'm glad that we divested that in 2022. A year later, we divested our North America Land Oil business, which also was very much a commodity business. No, it's an important question that you, that you're raising. no it's an important question that you that you're raising If you look big picture, where we came from is we were a hybrid. if you look big picture where we came from is we were a hybrid Clariant was both active in commodity businesses and in specialty businesses. clariant was both active in commodity businesses and in specialty businesses If you look at the recent years, we've really repositioned the business to become fully specialty. if you look at the recent years we've really repositioned the business to become fully specialty If you look at the recent, let's say, five years, what we did is in 2022, we divested our pigment business, which we clearly saw that was commoditizing. if you look at the recent let's say five years what we did is in 2022 we divested our pigment business which we clearly saw that was commoditizing By the way, it has indeed even further commoditized, so I'm glad that we divested that in 2022. by the way it has indeed even further commoditized so i'm glad that we divested that in 2022 A year later, we divested our North America Land Oil business, which also was very much a commodity business. a year later we divested our north america land oil business which also was very much a commodity business If you look now, what we also did was we divested a part of our Care Chemicals business, the commodity surfactants, to Wilmar, and we put it in a joint venture there. We've done actually quite a bit in recent years to, first of all, get out of our commodity business, but at the same time to strengthen our specialty chemical business. We did a number of smaller, bolt-on acquisitions. We bought the cosmetic ingredients business in Brazil with actives. We bought the green surfactant business in India. We did the purification business from BASF for renewable diesel, Attapulgite in the United States, and last but not least, the Lucas Meyer Cosmetics business, which really strengthens our position in personal care. If you look now, what we also did was we divested a part of our Care Chemicals business, the commodity surfactants, to Wilmar, and we put it in a joint venture there. if you look now what we also did was we divested a part of our care chemicals business the commodity surfactants to wilmar and we put it in a joint venture there We've done actually quite a bit in recent years to, first of all, get out of our commodity business, but at the same time to strengthen our specialty chemical business. we've done actually quite a bit in recent years to first of all get out of our commodity business but at the same time to strengthen our specialty chemical business We did a number of smaller, bolt-on acquisitions. we did a number of smaller bolt-on acquisitions We bought the cosmetic ingredients business in Brazil with actives. we bought the cosmetic ingredients business in brazil with actives We bought the green surfactant business in India. we bought the green surfactant business in india We did the purification business from BASF for renewable diesel, Attapulgite in the United States, and last but not least, the Lucas Meyer Cosmetics business, which really strengthens our position in personal care. we did the purification business from basf for renewable diesel attapulgite in the united states and last but not least the lucas meyer cosmetics business which really strengthens our position in personal care What you see now is that we have leading positions in specialty chemicals in the segments where we compete. At the same token, what you also see, Chetan, is that we have year-on-year improved the profitability of these businesses. We rarely get the question asked, "Are you the right owner for this business?" As long as we just continue to improve the profitability and in fact achieve leading profitability, both in terms of growth, in terms of margins, we have very sustainable positions in each of these segments because we are having significant market shares in the individual businesses. Yeah, that's, I think, sort of the summary from sort of an M&A perspective, where we are, and we remain interested to continue to do bolt-on acquisitions in these businesses, but only if they bring real synergy. What you see now is that we have leading positions in specialty chemicals in the segments where we compete. what you see now is that we have leading positions in specialty chemicals in the segments where we compete At the same token, what you also see, Chetan, is that we have year-on-year improved the profitability of these businesses. at the same token what you also see chetan is that we have year-on-year improved the profitability of these businesses We rarely get the question asked, "Are you the right owner for this business?" As long as we just continue to improve the profitability and in fact achieve leading profitability, both in terms of growth, in terms of margins, we have very sustainable positions in each of these segments because we are having significant market shares in the individual businesses. we rarely get the question asked "are you the right owner for this business?" as long as we just continue to improve the profitability and in fact achieve leading profitability both in terms of growth in terms of margins we have very sustainable positions in each of these segments because we are having significant market shares in the individual businesses Yeah, that's, I think, sort of the summary from sort of an M&A perspective, where we are, and we remain interested to continue to do bolt-on acquisitions in these businesses, but only if they bring real synergy. yeah that's i think sort of the summary from sort of an m&a perspective where we are and we remain interested to continue to do bolt-on acquisitions in these businesses but only if they bring real synergy

Speaker 2: Makes sense. Thank you very much. Makes sense. makes sense Thank you very much. thank you very much

Speaker 5: Thank you. Thank you. thank you

Speaker 11: The next question comes from Jaideep Pandya from On Field Research. Please go ahead. The next question comes from Jaideep Pandya from On Field Research. the next question comes from jaideep pandya from on field research Please go ahead. please go ahead

Speaker 6: I, thank you for allowing me to ask question. First question is on Catalyst, actually. What do you think is the longer term outlook like when you look at the next sort of three years, considering so many capacity shutdowns that have been announced in Europe, and also sort of asset rationalization in China, as well? What do you see as a longer term outlook in Catalyst? That's my first question. The second question sort of is I apologize if you have answered this before or if you cannot go in details, but if you can give us some color, at least on the legal situation around the ethylene, cartel case. What sort of provision have you booked already? I, thank you for allowing me to ask question. i thank you for allowing me to ask question First question is on Catalyst, actually. first question is on catalyst actually What do you think is the longer term outlook like when you look at the next sort of three years, considering so many capacity shutdowns that have been announced in Europe, and also sort of asset rationalization in China, as well? what do you think is the longer term outlook like when you look at the next sort of three years considering so many capacity shutdowns that have been announced in europe and also sort of asset rationalization in china as well What do you see as a longer term outlook in Catalyst? what do you see as a longer term outlook in catalyst That's my first question. that's my first question The second question sort of is I apologize if you have answered this before or if you cannot go in details, but if you can give us some color, at least on the legal situation around the ethylene, cartel case. the second question sort of is i apologize if you have answered this before or if you cannot go in details but if you can give us some color at least on the legal situation around the ethylene cartel case What sort of provision have you booked already? what sort of provision have you booked already Any timeline in terms of result that we could hear around this? Finally, just on the consolidation point, Conrad, I mean, from the, from on paper, if I just sort of ask the question differently, what Chetan was, I guess, trying to ask, you know, the obvious candidate for increasing your size would be in Care Chemicals. You know, if there is a case to be presented, are you saying you could be aggressive enough to, you know, further pursue divestments of some of the other areas to pursue increasing size in Care Chemicals? Thank you so much. Any timeline in terms of result that we could hear around this? any timeline in terms of result that we could hear around this Finally, just on the consolidation point, Conrad, I mean, from the, from on paper, if I just sort of ask the question differently, what Chetan was, I guess, trying to ask, you know, the obvious candidate for increasing your size would be in Care Chemicals. finally just on the consolidation point conrad i mean from the from on paper if i just sort of ask the question differently what chetan was i guess trying to ask you know the obvious candidate for increasing your size would be in care chemicals You know, if there is a case to be presented, are you saying you could be aggressive enough to, you know, further pursue divestments of some of the other areas to pursue increasing size in Care Chemicals? you know if there is a case to be presented are you saying you could be aggressive enough to you know further pursue divestments of some of the other areas to pursue increasing size in care chemicals Thank you so much. thank you so much

Speaker 5: Yeah. Thank you, Jaideep. Yeah, first, on your question on Catalyst and the long-term outlook, I think what is important to realize is that there has been a shift in production. Europe has actually significantly come down in chemical production. Cefic issued an interesting recent study that since 2022, a total of 37 million tons of capacity has been taken out of the market in Europe. That's roughly 10% of the overall capacity. At the same token, you have seen a buildup of capacity in China and to a lesser extent, in the Middle East. Yeah, so there is a shift. If you look at the global outlook for catalysts, it is actually a fairly robust business, even this, regardless of these shifts, these regional shifts. Yeah. yeah Thank you, Jaideep. thank you jaideep Yeah, first, on your question on Catalyst and the long-term outlook, I think what is important to realize is that there has been a shift in production. yeah first on your question on catalyst and the long-term outlook i think what is important to realize is that there has been a shift in production Europe has actually significantly come down in chemical production. europe has actually significantly come down in chemical production Cefic issued an interesting recent study that since 2022, a total of 37 million tons of capacity has been taken out of the market in Europe. cefic issued an interesting recent study that since 2022 a total of 37 million tons of capacity has been taken out of the market in europe That's roughly 10% of the overall capacity. that's roughly 10% of the overall capacity At the same token, you have seen a buildup of capacity in China and to a lesser extent, in the Middle East. at the same token you have seen a buildup of capacity in china and to a lesser extent in the middle east Yeah, so there is a shift. yeah so there is a shift If you look at the global outlook for catalysts, it is actually a fairly robust business, even this, regardless of these shifts, these regional shifts. if you look at the global outlook for catalysts it is actually a fairly robust business even this regardless of these shifts these regional shifts If you look at the long-term outlook, petrochemicals historically, globally, has always performed at or above GDP. That is still intact. The change is actually that there are some regional shifts, and therefore it was, for us, extremely important to invest in China, in catalysts, in our footprint, and we're very happy with that footprint now that we also have in China to support the local growth. In terms of long-term outlooks, the fundamentals are still intact at a global level, but yeah, there have been regional shifts for sure. In terms of your second question on legal, yeah, in terms of ethylene claims, at this stage, we cannot publicly comment any further than what we've already said. Clariant firmly rejects the allegations and will vehemently defend its position in the proceedings. If you look at the long-term outlook, petrochemicals historically, globally, has always performed at or above GDP. if you look at the long-term outlook petrochemicals historically globally has always performed at or above gdp That is still intact. that is still intact The change is actually that there are some regional shifts, and therefore it was, for us, extremely important to invest in China, in catalysts, in our footprint, and we're very happy with that footprint now that we also have in China to support the local growth. the change is actually that there are some regional shifts and therefore it was for us extremely important to invest in china in catalysts in our footprint and we're very happy with that footprint now that we also have in china to support the local growth In terms of long-term outlooks, the fundamentals are still intact at a global level, but yeah, there have been regional shifts for sure. in terms of long-term outlooks the fundamentals are still intact at a global level but yeah there have been regional shifts for sure In terms of your second question on legal, yeah, in terms of ethylene claims, at this stage, we cannot publicly comment any further than what we've already said. in terms of your second question on legal yeah in terms of ethylene claims at this stage we cannot publicly comment any further than what we've already said Clariant firmly rejects the allegations and will vehemently defend its position in the proceedings. clariant firmly rejects the allegations and will vehemently defend its position in the proceedings We do have substantiated economic evidence that the conduct of the parties did not produce any effect on the market. Yeah, we are in litigation, so we cannot comment further on that, other than your question on the provisions, we haven't taken any, and this obviously has been reviewed with our auditor, KPMG, and they're obviously of the same opinion, and you will see that in our integrated report also explained. We do have substantiated economic evidence that the conduct of the parties did not produce any effect on the market. we do have substantiated economic evidence that the conduct of the parties did not produce any effect on the market Yeah, we are in litigation, so we cannot comment further on that, other than your question on the provisions, we haven't taken any, and this obviously has been reviewed with our auditor, KPMG, and they're obviously of the same opinion, and you will see that in our integrated report also explained. yeah we are in litigation so we cannot comment further on that other than your question on the provisions we haven't taken any and this obviously has been reviewed with our auditor kpmg and they're obviously of the same opinion and you will see that in our integrated report also explained

Speaker 6: Thank you. Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 11: The last question for today is a follow-up coming from the line of Thea Badaro, BNP Paribas. Please go ahead. The last question for today is a follow-up coming from the line of Thea Badaro, BNP Paribas. the last question for today is a follow-up coming from the line of thea badaro bnp paribas Please go ahead. please go ahead

Speaker 12: Yeah, thanks. Just a quick follow-up from me. Specifically on the flame retardant business, can you quantify the size of the data center market opportunity for your flame retardant business? Yeah, thanks. yeah thanks Just a quick follow-up from me. just a quick follow-up from me Specifically on the flame retardant business, can you quantify the size of the data center market opportunity for your flame retardant business? specifically on the flame retardant business can you quantify the size of the data center market opportunity for your flame retardant business

Speaker 5: Yeah, this is a very interesting question, and we just made a deep dive, actually, on data centers, and to make sure that we capture all of the share that is out there when it's about our products. What we are seeing is, indeed, that our flame retardants are benefiting from this. This is about, the, yeah, our flame retardants for connectors, for switches, switch gears, cable jackets. That is a part of it. There's also a part of it which sits in fire-resistant coatings, actually, that are applied to the infrastructure of these buildings. Finally, and this is also quite important, our Catalysts business, we are really targeting data centers here as well. Yeah, this is a very interesting question, and we just made a deep dive, actually, on data centers, and to make sure that we capture all of the share that is out there when it's about our products. yeah this is a very interesting question and we just made a deep dive actually on data centers and to make sure that we capture all of the share that is out there when it's about our products What we are seeing is, indeed, that our flame retardants are benefiting from this. what we are seeing is indeed that our flame retardants are benefiting from this This is about, the, yeah, our flame retardants for connectors, for switches, switch gears, cable jackets. this is about the yeah our flame retardants for connectors for switches switch gears cable jackets That is a part of it. that is a part of it There's also a part of it which sits in fire-resistant coatings, actually, that are applied to the infrastructure of these buildings. there's also a part of it which sits in fire-resistant coatings actually that are applied to the infrastructure of these buildings Finally, and this is also quite important, our Catalysts business, we are really targeting data centers here as well. finally and this is also quite important our catalysts business we are really targeting data centers here as well This is first from a development perspective, we're very happy that we also commercialize now the first application where we basically have a fuel cell technology. We have methane, we have basically gas, we convert it to hydrogen, the hydrogen basically gets converted into water and electricity. This is a climate neutral, if it's biomethane, a climate neutral solution actually, for decentralized and distributed electricity generation in the right high quantities that are necessary. There's other solutions. Nuclear is also mentioned, particularly with the limited grid capacity, the solution will be power plants, small power plants in the United States, and Europe has the same challenge. This is first from a development perspective, we're very happy that we also commercialize now the first application where we basically have a fuel cell technology. this is first from a development perspective we're very happy that we also commercialize now the first application where we basically have a fuel cell technology We have methane, we have basically gas, we convert it to hydrogen, the hydrogen basically gets converted into water and electricity. we have methane we have basically gas we convert it to hydrogen the hydrogen basically gets converted into water and electricity This is a climate neutral, if it's biomethane, a climate neutral solution actually, for decentralized and distributed electricity generation in the right high quantities that are necessary. this is a climate neutral if it's biomethane a climate neutral solution actually for decentralized and distributed electricity generation in the right high quantities that are necessary There's other solutions. there's other solutions Nuclear is also mentioned, particularly with the limited grid capacity, the solution will be power plants, small power plants in the United States, and Europe has the same challenge. nuclear is also mentioned particularly with the limited grid capacity the solution will be power plants small power plants in the united states and europe has the same challenge With Catalyst, we're talking about a very interesting opportunity here, which already the first, what we now commercialize, is a few tens of millions already in revenue in the outlook that we have. The size for flame retardants combined right now globally is also in that order of magnitude. It is not moving the goalpost for the company as a whole, but we are seeing a nice upside from data centers. With Catalyst, we're talking about a very interesting opportunity here, which already the first, what we now commercialize, is a few tens of millions already in revenue in the outlook that we have. with catalyst we're talking about a very interesting opportunity here which already the first what we now commercialize is a few tens of millions already in revenue in the outlook that we have The size for flame retardants combined right now globally is also in that order of magnitude. the size for flame retardants combined right now globally is also in that order of magnitude It is not moving the goalpost for the company as a whole, but we are seeing a nice upside from data centers. it is not moving the goalpost for the company as a whole but we are seeing a nice upside from data centers

Speaker 12: Thank you. Thank you. thank you

Speaker 5: Thank you. Thank you. thank you

Speaker 1: Thank you very much. This is Andreas speaking. This concludes today's conference call. A transcript of the call will be available on the Clariant website in due course. The investor relations team is available for any further questions you may have. Once again, thank you for joining the call today, and have a good afternoon. Thank you very much. thank you very much This is Andreas speaking. this is andreas speaking This concludes today's conference call. this concludes today's conference call A transcript of the call will be available on the Clariant website in due course. a transcript of the call will be available on the clariant website in due course The investor relations team is available for any further questions you may have. the investor relations team is available for any further questions you may have Once again, thank you for joining the call today, and have a good afternoon. once again thank you for joining the call today and have a good afternoon

Speaker 11: Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call. Thank you for participating in the conference. You may now disconnect your lines. Goodbye. Ladies and gentlemen, the conference is now over. ladies and gentlemen the conference is now over Thank you for choosing Chorus Call. thank you for choosing chorus call Thank you for participating in the conference. thank you for participating in the conference You may now disconnect your lines. you may now disconnect your lines Goodbye. goodbye