Welcome to Aperam Q1 2024 results call. My name is Ellen, and I'll be your coordinator for today's event. Please note this call is being recorded, and for the duration, your lines will be on listen only. However, you will have the opportunity to ask questions at the end. This can be done by pressing star one on your telephone keypad. If you require assistance at any time, please press star zero, and you'll be connected to an operator. I'll now hand you over to your host, Timoteo Di Maulo, CEO, to begin today's conference. Thank you.
Hello everybody. I'm here with Sudhakar Sivaji, and we are happy to take your questions. Please.
Thank you. If you'd like to ask a question, please press star one now. We'll pause for just a quick moment to allow everyone an opportunity to signal for questions. We will take our first question from Moses Ola, JP Morgan. Your line is open. Please go ahead.
Hi there. Thank you so much for taking my question. I just wanted to ask about this current state of the European market. Obviously, the market's been quite tight over the past quarter, and this is, from what we see, leading to longer lead times. Could you please perhaps give us an estimate on current lead times within the market, and what do you see as the response of distributors currently? Are they perhaps looking to seek imports given how tight supply is? It would be good to just get some color currently on your view on that, please.
Thank you for the question, but here there is probably some kind of different view. So market has been impacted because probably you're referring to the fact that some competitors have had some weeks of strikes. So they have been impacted by reduced supply from 2 suppliers. But in reality, market is still so low in terms of consumption that there is no real tightness in the supply and demand. So the level of lead time remains normal a couple of months, and there is no, let's say, spike in any kind of tension that could lead to higher imports or a spike of prices. And this is because of the final demand, which remains very, very low.
Thanks for the clarification. Maybe just on the real demand sectors, where do you see the most likelihood for a rebound in demand in terms of by sector?
I think that all the sectors are impacted by the fact that the consumers are waiting for better news about the interest rates and about a better mood also for the threat of Ukraine, all these political issues. So typically, we see that for us, the construction has been extremely low. And for construction, you have to see also all the related markets which are going with the construction, like when you have construction, you have white goods, you have lifts, etc. So the good news there is that the good news there is that inventories have been normalized. And so in general, this means that there is no more room for stock decrease.
Thank you. Just finally, if I may, just a housekeeping one. I heard on the podcast from Sudhakar working capital guidance to the end of the year, but could you please just clarify? Did you mean EUR 120 million Q2, Q3, and Q4, or did you mean a EUR 120 million release for the whole of 2024?
Hey, Moses. Hi. I meant EUR 120 million for the rest of the year, so Q2, Q3, Q4.
Okay. Thank you.
We will take our next question from Tristan Gresser, BNP Paribas. Your line is open. Please go ahead.
Yes. Hi. Thank you for taking my questions. The first one is on the situation in Brazil. Can you discuss a little bit what happened with the rolling mill and the timeline of that? And also, if you could discuss and quantify the volume cost impact that is baked into the Q2 guidance. Yeah, I'll start there.
So in Brazil, you know that we had a major investment in our hot rolling mill. So it is a huge one because it was an investment to enlarge the size of our hot rolling mill. This kind of investment, it is always, let's say, difficult in ramp-up, and especially in a plant which is operating. So we have had some problems and delay in the ramp-up. Now it's going well, but this delay will have a kind of, let's say, impact, especially in Q2, some delay in quantities, in quality, with also some manual labor cost that is giving us, let's say, a low double-digit impact. So about, we will say, in the range of EUR 10 million.
All right. That's clear. Thank you. And the second question then is on the strike at Gueugnon. If you could provide also some color there on when did it start, if the facility is totally shut down at this stage, and if you could remind us what the restructuring plan entails. And I believe you also flagged some potential impact if the strike continues into Q3. So kind of same question in terms of magnitude. Is it low double-digit impact as well there? Any type of color would be appreciated. Thank you.
So Tristan, if it's all right, I can take that one, right? So you had three questions. So let me start with that. The total restructuring or cost reduction plan, fixed cost reduction plan of Europe, to remind you, over the next three years, the booster we said was EUR 50 million, right? So one of this basically is a factor in this, and that's your second question, is about increasing our productivity in our cold rolling mills. And specifically, in this case, the site under discussion is our plant in Gueugnon. And so we have started the discussions with the workers' representatives, and obviously, these are initial stages of discussions, and there is some strike action there. The most important thing to remember is that the strike action does not disable the mill, but we are working with reduced productivity.
This is something which we expect, and we plan that risk for Q2. Impacting production in Q2 means impacting in Q3, right? The last part of your question was the size of that impact. We don't expect, in terms of EBITDA, a significant impact. We are talking about a low single-digit impact. Sorry, a mid-single-digit impact.
Okay. That's clear. I'll go back to the queue. Thank you.
We will take our next question from Maxime Kogge. ODDO BHF, your line is open. Please go ahead.
Hey. Good afternoon. So first question, yeah, is on the strikes, but this time affecting your competitors. Were you able to benefit somewhat from that in Q1, and are you able also to somewhat benefit from it in early Q1, given that in Spain, the mill remains at a standstill?
Okay. So of course, there was some benefit, but the benefits are not fully compensating the situation of the market. So the market, as I'm keeping on repeating, is extremely low, which means that the strikes have compensated part of the lack of demand but without creating any tension on supply. And when you refer to prices, prices have been so low for a so long time, and the mood of our customers is also so bearish that some small price increases have been possible, but this is not changing a lot of the situation of the European market.
Okay. And just a second one. This is on working capital. Should we already see a benefit, I mean, an inflow in Q2? Otherwise, net leverage could increase further. And is there any loan or facility where this could raise an issue, at least temporarily?
So Maxime, let me take that. First of all, there is no loan or any financing issue because I remind you that we do not have any financial governance except our equity ratio. Basically, we have no threat, first of all, because of this temporary cyclical effect. Second thing is that we've clearly guided to a net debt reduction in Q2 because of working capital, right? That's our outlook, and that is clear. Yes, we'll have a working capital reduction, and because of that, we expect a net debt reduction.
Okay. That's clear.
That will be the primary driver of what Moses asked earlier.
All right. Thank you.
Sure.
We will take our next question from Ioannis Masvoulas. Morgan Stanley, your line is open. Please go ahead.
Yes. Hello. Good afternoon. It's Ioannis Masvoulas from Morgan Stanley. Thanks for taking the questions. A couple left from my side. The first, you mentioned that the inventory valuation effect in Q2, you expect it to be broadly neutral at current raw material prices. What shall we expect for Q3? I mean, is there any lag effect? Is there any positive development as we think about the bridge Q2 to Q3, or if spot prices persist, we should also expect neutral impact in the third quarter? Thank you.
Ioannis?
I think it's an easy answer. We have many times said and we confirmed that even during the quarter, it's difficult to assess what will be the impact in terms of inventory valuation of the transit raw material. If you ask for Q3 or the rest of the year, it's even more even impossible to know that.
Okay. Thank you for that. The second question around Europe. As we go into the summer, is there any reason to expect that seasonality will be less pronounced than usual in terms of volume given the current levels of production across the European sites?
The seasonality remains the seasonality in terms of number of days the plants of our customers are opened. For the moment, we don't see how this will change dramatically. It's clear that today, we are in a low cycle. Let's see what the future will be. If there is further demand, it could be a little bit smoother, I hope, for this, but for the moment, we have no visibility on that.
Very clear. Thank you very much.
We will take our next question from Tom Zhang, Barclays. Your line is open. Please go ahead.
Hi. Thanks very much for taking our questions. Just two from my side, please. First, on Services and Solutions, you obviously mentioned yeah, you mentioned in the podcast you're probably looking at flat EBITDA quarter- on- quarter. It doesn't sound like you're getting a big drop of volumes, but you mentioned there was still pretty bad negative inventory valuation effect in Q1. Is there any reason it's not rolling off? And you mentioned at Group, you're going towards neutral inventory valuation. I would have expected otherwise, Services and Solutions to probably be a little bit better quarter on quarter. Is there anything else I'm missing, please?
So you'll take it, or I will?
Yeah. I'll take it. So in terms of, see, the inventory valuation effect in S&S, you see, S&S is the closest to the customer, right? So when the inventory valuation effect hits, it hits S&S the most and the fastest. And in Q1, S&S did profit from this slight improvement in the price situation, but since then, it has flattened off going into the next quarter. And I just want you to please keep in mind that when Stainless Europe prices go up, the effect is felt in S&S the next quarter because of the supply chain.
Right. Sorry. But just to confirm, sorry, because you mentioned in the slides, I guess, the Q1 inventory charge was more negative than in Q4 2023, right? So I would have expected that to sort of that should be a pretty if that goes to zero, that should be beneficial into Q2, no? As you mentioned, it comes through faster in Services and Solutions, and we've obviously seen nickel find a bit of a floor.
Sure. No, I understand. The point is that it was more negative, but if you look at it in Q2, when it reverses, the volume effect remains flat still. And see, basically, you have Stainless Europe. Stainless Europe is selling to S&S. And the windfall effect of Q1 will reverse into Q2. But however, as the profits of Stainless Europe increase in Q2, that will have a price-cost squeeze into S&S.
Okay. Okay. Got it. Thank you. And then just on CapEx, I guess you've reiterated the sort of EUR 150 million this year, which sort of implies quite a sharp drop-off in CapEx run rates. Is this purely just because Leadership Journey 5 is so much less capital-intensive, or is there any sort of risk this is CapEx that's being pushed out into 2025? I mean, it's obviously a little early to say, but is EUR 150 million the new sort of run rate that we should be thinking about for the entire Leadership Journey 5 period, or is there a bit of a step up to come? Thanks.
So there's two parts to the discussion. First one is that we did come out and say in the last Leadership Journey, when we were doing all these investments, that these should cover the next phase of the Leadership Journey as well. So most of the investment for Leadership Journey 5 has already been done, okay? And when you look at EUR 150 million, this is what we consider it as for the current crisis scenario which we are facing in the stainless industry and the reduced demand, which means that we actually have reduced utilization and, as a result, also reduced R&M expenses. So the 150 is not purely just maintenance CapEx. It does consider at least 10%-20% of strategic CapEx as well. So that's how you look at it.
Going forward, if the utilization of the stainless industry increases and our stainless situation gets better and we have to run more of our plants, then, of course, this will proportionally change like in the past. As of now, you should look at nothing significantly different from the 150 going if situation remains as such.
Understood. Thank you very much. I'll turn it back.
Sure.
We will take our next question from Tristan Gresser, BNP Paribas. Your line is open. Please go ahead.
Yes. Thank you for the follow-up. Just on the new trade case in Europe, given the retroactive application we've seen since last summer when this is announced, I don't believe there will be much of an impact on the marketplace, especially given that volumes are pretty low. But given there has been some exclusions to those duties, do you believe those exporters that could have been out of the market could now come back? And also, if you could maybe provide us a sense, if you have it, of those exclusions, how big are they? Let's say those exporters that got those exclusions, how much do they represent of the supply? Do you get a sense, or do you think it's not going to be that much of a factor?
So thanks for the question. First of all, on retroactivity, yes, there is retroactivity. But you have noticed that as everybody knew about the retroactivity, everybody has well prevented from importing from the countries which were considered in the circumvention. So I have not the customs detail, but I don't expect that this will generate a lot of retroactivity duties to be paid by the importers because everybody knew very well what could have happened, as it has happened already last year in the case of the anti-circumvention against Turkey for a toll. Concerning what is the sense of this anti-circumvention, we think it is a good measure because also introduced something which is extremely important for the future, which is the concept of melt and pour.
So yes, there are some exclusions, but these exclusions have been with the concept of justifying and giving the origin of the material in the concept of melt and pour. And this will open, even for those who have been excluded, the possibility in the future to be trapped into the anti-circumvention. And concerning how much of the, let's say, importers have been, let's say, considering the anti-circumvention, I would say that the large majority of those who have increased and this was the sense. The sense of this measure is not to, let's say, close the European market but to assess all the unfair behaviors which have been, let's say, there during the period of investigation. So we believe that the large majority will be assessed.
Okay. Perfect. Thank you.
Welcome.
We will take our next question from Bastian Synagowitz, Deutsche Bank. Your line is open. Please go ahead.
Yeah. Thanks and good afternoon all. I'll start off with a couple of follow-ups and maybe housekeeping ones as well. The first one is actually on Brazil. Tim, you mentioned this EUR 10 million cost item in relation to the, I think, the problems in the hot rolling mill. Was this just the pure cost headwind, or did this include the all-in effects from lower shipments as well?
This includes mostly all effects.
All effects. Got you. Okay. And then maybe one for Sud on the Cash Flow Bridge, which I think you're providing on page number 8. There is this EUR 31 million other item. What is in there, please? It's a pretty large item, particularly now that your overall cash generation and earnings level is obviously pretty low.
You're talking about the Cash Flow Bridge, right? Bastian, because I yeah. So look, in the beginning of the year, there's two effects. One, typically, the first quarter, there are profit-sharing agreements, bonuses, and those things, right? That's part of it. That's a one-time effect which happens. And the other part is that you remember that last year, as we finished and ramped on all the investments, we cut net working capital drastically in the last quarter, right? So if you're comparing Aperam to peers, and that's something which I always say, please be careful that you compare apples to apples, which is that we cut net working capital ahead of the cycle, ahead of the peers, which means that our net working capital cut happened last quarter already.
Now, when we build up this quarter and we buy raw materials, there is a VAT imbalance, and that contributes to a large part of that. This will compensate across the year as we sell more and the inventory drops down. Is that clear?
A quick follow-up there, please. Does it mean that that other item, which is separate to working capital, does actually include certain working capital component? Did I understand that correctly?
No, no, no. When you buy raw materials or something or when you purchase supplies, when you purchase consumables, you pay VAT charges. And in the first quarter, when you actually go ahead and do advance purchases or build inventory, those VAT charges get built. And after that, when we actually go into the other quarters and when we receive the VAT payments from our customers, they get canceled out, the cash out. So that's the profile, typically. If you go back and see in the past years, it's always been there. When we go out and purchase more in terms of supplies, working capital, there's higher VAT payments, and then it gets balanced towards the rest of the year as the production goes down or as net working capital gets cut.
Okay. Got you. That is clear. Thank you. Just one question here. I mean, is Europe actually making money? Is Europe back to break even? Is Europe making money here?
Yeah. So in our assumption, I can give you a clear number. Q1, Europe's break even. It's even slightly positive, okay? And that is without the inventory valuation effect. If you add the inventory valuation effect, it's even double-digit positive. And in Q2, our forecast includes a very positive Europe, which is, for us, almost a normal EBITDA number considering the crisis situation we operate in. I just remind you about the margins we operate in if you take base price. And you do remember that we are at historical lows compared to even COVID quarters in Europe, right? In COVID quarters, we were at 700, these base price margins. And today, we are even lower than that. Operating at that level of profitability, we are still we are still at what we would consider for such a crisis level at normal profitability.
I'm happy that our cost-control measures, also temporary until the restructuring happens, have started working in Europe.
Okay. Okay. But maybe coming back to the situation and I guess Benassa, I think, asked also a similar one in the last call. But I guess, obviously, the situation is extremely tough. I guess we all understand that, yet, obviously, volumes have improved. At least seasonally, there has been clearly at least a bit of a tension on the market from the current strike situation. So conceptually, obviously, four players in the market is obviously not a high number. We've gone temporarily to maybe just two. We're now back to maybe three players in the market. I guess, as you say, imports at the moment are not really your enemy. So there is, obviously, the demand side, but I guess who knows, really, when that's coming back? I guess the question is, do you really feel that the European price discipline is really broken?
Do you think we even need another consolidation step or even closures to get this repaired?
So it is difficult to say because there are a lot of elements that are in this kind of equation. There is also the fact that globally, in the world, prices, except in the United States, prices are very low globally, okay? And so this induces the fact that you have always a balance between what is the global price versus the European price, etc. And what people doesn't assess very well is what is the real tension on supply in Europe. In reality, the few weeks of strikes have been partially mitigated by some inventory that has been probably used by the competitors to smooth down the effect of the strikes and on the fact that the real demand is not there. And there is no tension, no tension of scale in the inventory. So this is not giving any boost to a price increase.
So the question of discipline is not a question of discipline. It's that a few of the elements which should give a sense to a price increase are not yet there.
Okay. And so basically, to turn this around, you don't think it actually needs closures or another consolidation step? Obviously, the question is whether the EC would even allow that to happen. Obviously, it would be difficult with the history, but you don't think that that is needed?
I think that the most effective will be some recovery in the consumption and the confidence of the customer because also our customers are in a very bearish mood. So they are not allowing any price increase also because they are not allowed to increase prices.
Okay. Understood. And then maybe turning this over to Brazil. I guess if Europe is making money, it also shows that Brazil, at the moment, is obviously not making money. You're obviously in a much, I would say, more beneficial situation. They are a monopolist. They're also being at least partially protected by duties, even though the government, obviously, has just rejected your request to lift the import protection. But I guess if they are saying, "We're not protecting you more," I guess it does mean that you basically have one lever left to basically address it, which is cost. So do you think you have an actual cost issue there in Brazil in the sense that, well, you've been protected by import duties? You've been doing okay, but now the pressure has been rising too much.
You really have to go much more into your cost structure if the government is not working for you in a more forceful way?
I take it. Yeah.
Tim, you talk about it. Go ahead, and then I'll comment about the cost structures.
No, the point, first of all, I will say that what has happened, in reality, is nothing in the sense that the measures that are in place since a few years are remaining in place. So we have a duty to enter in Brazil. We have a situation in Brazil that costs competitively in Brazil, and Sud will take more on the cost. And that is not changing. Brazil has gone through some destocking, but the real consumption is very good. The problem of Brazil is that when international prices are low, as the mechanism of the price in Brazil is linked to the international price plus the duty internalization and the premium to be in Brazil, the price level is lower.
You can see in any curve that represents Brazil, Europe, etc., that Brazil has still a premium but with a price level which is much lower than it was in the past.
Yeah. Thanks, Tim. So Bastian, so important to understand that there's two effects, right? One is that we've talked about Brazil and the effect of seasonality and this hot strip mill effect, right? We have to be very clear that international prices estimates, explained, are working at very low margins. And in these margins, basically, for Q2 outlook, Q2 is the first normal quarter of Brazil in the year, you understand. Brazil will probably be a very low double-digit EBITDA because of this hot strip mill issue, okay? We are talking about probably the lowest double-digit EBITDA effect possible, which is like EUR 9-EUR 10 million effect possible, okay? This is purely a temporary effect because of the hot strip mill. The cost competitiveness of Brazil has not fundamentally changed, right? End of the day, our core product portfolio ensures that we operate with the highest cost competitiveness.
In the capital markets there, I've shown you a chart there. Landed in Brazil, Brazil is, thanks to also our own charcoal, which we use in our blast furnaces, the most cost competitive product to sell in Brazil, right? That situation has not changed. I showed you that chart about a month ago, and nothing has changed. So it is not a cost situation. It's purely seasonality in Q1 and in Q2, that EUR 9-EUR 10 million effect resulting from the hot strip mill ramp-up. That's it.
Got you. Okay. So yes, it doesn't seem to be that very because, again, that was my point. I think prices in Brazil are still at a premium to international. And I get international prices are low, but yeah, yet it seems like in Q1, at least, you've not been able to make money despite, I guess, seasonality being maybe weaker, but demand, as you say, is still apparently much more normal and decent relative to most other markets. So does this mean that we could and should, I guess, see a relatively powerful snapback in Brazil and the operational and financial performance going into the third quarter? I'm clearly not asking you to give a third-quarter guidance. I think it's just too early. But at least conceptually, we've got these items. We've got the EUR 10 million cost item.
I think seasonally, usually, Brazil also strengthens further into the third quarter. I guess with all of those pieces you're giving us here, at least that sequential step-up would be my guess. But yeah, at least maybe curious to hear what you have to say here initially.
Bastian, I would like to clear up absolutely one probably misunderstanding we seem to have, which is that in Q1, I said that earlier to the question that Europe broke even, right? And then I said Europe broke even. That basically shows that Europe has made progress from Q4 of last year and Q3 of last year, where they were very strongly negative.
However, it also clearly indicates that almost all the results you see for the Stainless and Electrical segment, which came from Brazil, which basically means for a Q4 with low shipments and low seasonality, I would go back and revise, if possible, your statement about Brazil, "We did not make money," or, "We hardly made money in a Q4." We are used to 2021 and 2022 numbers, but I just want to remind you, to take you to Brazil before 2021 and 2022, where, again, without BioEnergia, Brazil was making close to EUR 80 million-EUR 100 million over a year. Split that into four. It's EUR 25 million. Adjust for seasonality for Q4 and Q1. You will understand where the Q1 and Q4 results are. So I would please reconsider the fact that you're looking at Q1 where Brazil is not making money.
Our guidance towards hot strip mill having an effect is purely a Q2 effect. In Q3, this one-time effect will be removed. We are confident on that. Is that clear?
Yeah, that is clear. No, again, I mean, I basically took your EUR 6 million in Q1, and you said it's break even in Europe. If it's break even in Europe, I guess it doesn't leave that much for Brazil. And that was my conclusion, basically. But yeah, no, I understand you. Okay. Thank you.
We will take our next question from Zenande Meyiwa, UBS. Your line is open. Please go ahead.
Good afternoon. Thank you so much for taking my question. Just at a high level, going back to Europe, I recall you mentioned that there's a competitor of yours, a smaller competitor, without naming names, that's aggressively buying market share in the form of increased volumes and lower prices and flooding the market. Is that still the case coming into Q2, or has there been a pullback given the depressed prices? Or is it just purely a macro and lack of demand that's limiting price increases?
No, I think there is no evident effect of any, let's say, producer which is going crazy in this period. So we have had the strikes, and then the strikes means that some of the competitor might have lost volumes in a low market, but there is no real fight. I think that the majority of the actors of the market are fully understanding how difficult is the situation and that there are needs of, let's say, taking measures to reduce cost and to be reasonable in what is the situation, even for price. Prices have not decreased since some time. And on the contrary, prices have had some slight improvement. But the question is that this slight improvement, I said before, needs also a comeback of the demand and some different moods of our customers.
Okay. Cool. That's clear. Thank you.
We will take the next question from Tom Zhang, Barclays. Your line is open. Please go ahead.
Hi. Thanks. Sorry, just one clarification, Sudhakar. Earlier, you mentioned Q1 Europe stainless. You said it was small positive EBITDA without the inventory valuation effect and then double-digit positive including the valuation effect. Did I hear that correctly?
It was the other way around. So basically, if you include inventory valuation effect, it's a negative effect. So yeah.
Okay. Cool. No, that makes a lot more sense. Thanks.
So yeah, just to, again, set that discussion, right? If you look at Stainless and Electrical results for Q1, the earlier exchange with Bastian shows that it was EUR 6 million. And when I said that stainless Europe turned positive, break even, most of that EUR 6 million came from Brazil. Now, let's take a low year earlier for Brazil, which was about EUR 70-EUR 75 million, like 2019, which is comparable to now. And if that year gets split up for seasonality, there's not a lot of delta to that EUR 6 million you will find in Q1. So you can use that to build up for Q2 when the seasonality is over and the EUR 10 million negative effect and then, again, reverse that EUR 10 million negative effect in Q3. Does that make sense?
Got it. No, it makes sense. Sorry, I must have just misheard because from the earlier comment, it sounded like the inventory effect was positive, which would have been weird. But no, all clear. Thank you.
As a reminder, if you'd like to ask a question, please press star one now. We'll take our next question from Maxime Kogge. ODDO BHF, your line is open. Please go ahead.
Yeah, just to ask a question on my side, do you know why stainless steel was left outside the new quota and import duty system in Brazil? Is it because you're the only national player? So there would be a risk that you benefit too much from the situation?
No, no, no, no, no, no, no. The quota are there, but the point is that many products were excluded. The system of quota in Brazil has been put in this way. They have allowed 30% more of the imports that have been in the best years of Brazil. In this case, the quota is not working at all. It's not efficient at all. It's like if you can allow it is like the safeguard in Europe. The safeguard in Europe established at the beginning that you have, on an average of three years, you establish the market share. Whatever it is on top of market share, it is penalized by 25%. Below, it is free. In Brazil, they have taken a much larger approach, saying whatever it is above the market share plus 30% is out of the quota.
In this case, it's not efficient. It's not something that is of interest. Now, what we count much more on Brazil is on the normal trade defense measures. Here, we are actively working. I hope we will have some good news very soon.
Okay. Clear. Thank you.
Okay. I think that there are no more questions. So thank you for attending this call today. There was a lot of discussion about Europe, about the one-offs, the strike, the disruption, what is the situation, etc. I will say in synthesis that our key message is very simple. The market, it remains extremely challenging in Europe for both volume and price. And even in this very tough moment, I would say that we see that our efforts on cost control are paying. We see that Europe has had a turnaround. So from break even to Q1 to positive in Q2, nearly normal. So this is a very positive result of our efforts in cost. Our investments are at the final step of being fully operational. This will boost our results for the times to come.
Better consumer spending, lower interest rate, and lower energy cost eventually will lead to a normalized market. At that moment, we will see all the results of the efforts we have done with our leadership journey. Today, it is still difficult. We have not so much spent time on the fact that Aperam combines the best-in-class ESG performance and sustainability growth in 2025 versus 2025. This is also to keep in mind because our target remains the same. I wish you a nice weekend. I hope to see you on the road soon. Bye-bye.
Thank you for joining today's call. You may now disconnect.