Good morning, and welcome to the Bekaert Third Quarter 2025 Trading Update Call. At this time, all participants are in a listen-only mode, and we will open the floor for your questions after the presentation. If you require assistance, you may press *0 on your keypad at any time, and an operator will assist you. If you wish to join the queue to ask a question at any time, you may press *1. Should you wish to remove yourself from the queue, press *2. As a reminder, this conference is being recorded. It is now my pleasure to turn the floor over to your host, Mr. Dries Van Hamme, Director of Investor Relations. Sir, the floor is yours.
Thank you. Welcome everyone to the analyst call on our Q3 trading update. As usual, I'll read out the safe harbor statement before passing on to Seppo Parvi, CFO, who will take us through the sales updates, and then to Yves Kerstens, CEO, who will conclude and give an outlook before we take it into Q&A. This presentation may contain forward-looking statements. Such statements reflect the current views of management regarding future events and involve known and unknown risks, uncertainties, and other factors that may cause actual results to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements.
Bekaert is providing this information in this presentation as of its date, does not take any obligation to update any forward-looking statements contained in it in light of new information, future events, or otherwise, and we do not disclaim any liability for statements made or published by third parties, and we do not undertake any obligation to correct inaccurate data, information, conclusions, or opinions published by third parties in relation to this or any other publication issued by Bekaert. I now hand over to Seppo.
Okay, thank you, Dries. Let's start by looking at the top-line development. First of all, if I would describe shortly third quarter, it's fair to say that we had an experienced stable sales in third quarter in difficult markets, and we have continued to focus very much on cash flow generation. Like-for-like sales in third quarter were broadly in line with last year. We saw some volume growth in core markets, but like I said, we are very much also focused on cash flow and further cost improvements. If you look at the reported sales, we saw a 3.8% decline due to the foreign exchange. That is translation-related. It relates to operations in the U.S. and China. Both currencies have weakened during the year, and obviously, when converting to EUR, our base currency, we see drop on the sales line.
Adjusting for M&A, as well as some capacity closures, that's another EUR 30 million reduction on the reported sales bringing to EUR 890 million, like-for-like base from, from, or in Q3 last year. 1% reduction there. Some slow, positive volume improvement and development there, as well as then price mix, reduction maybe passed through of the lower raw material costs. Looking at the key drivers and 3% volume growth that we saw during third quarter , we had growth in energy and utilities sector, in steel wire solutions, that is transmission wires, especially on the U.S. market. We had also volume growth in China for rubber reinforcement, and happy to report that we were running our plants fully, fully over there. U.S. flooring business was improving in third quarter for sustainable construction business.
However, we still saw some effects of the tariffs, but especially the number of tenders increasing in data center business, but also in industrial and warehouse-related flooring projects were picking up, but not at the same level as we had been in the previous year. In the steel ropes business, we saw weaker demand both in Europe and North America. Moving to nine-month sales spreads of where we are year to date, the like-for-like sales decline was mainly driven by lower raw material costs. If you look at the reported nine-month sales, we had about 2% negative effect from the effects, and the M&A and closures had the effect of EUR 26 million. Like-for-like 2024 sales were EUR 2,931 million compared to EUR 2,833 million this year.
Let's look at the various business units and business view, and let's start with rubber reinforcement, where like I said earlier, we saw volume growth both in China and North America. However, picture was a bit mixed across regions. In addition to volume growth in China, where we saw strong domestic markets, we had volume growth also in North America, but lower volumes in Europe, as well as in India, where we saw some increased competition from imports to the market. We have worked on optimizing our plant utilization, especially in China. That has helped us to support profitability and overhead coverage, as well as cash flow in the region. Also, happy to report and tell about new award recognition for our reinforcement innovation work done. We have received Green Point China Sustainable Case Award for advancing low-carbon tire manufacturing in ultra and mega tensile solutions.
Let's not forget our sales in Brazil. Joint venture in rubber reinforcement business had sales of EUR 33 million in third quarter, and these are not included in our consolidated sales, as I am sure you are aware. Moving to steel wire solutions, where we had strong volume growth in energy and utilities business, and happy to report that we had actually, like-for-like basis, 6% increase in the sales. We had strong volume growth and higher volumes also in China, supported by strong automotive end market, in addition to energy and utilities market, like mentioned earlier. You have to remember, if you look at the reported sales, that there is an effect of about EUR 33 million from SWS divestment in LATAM, Costa Rica, Ecuador, and Venezuela businesses that were finalized end of the first half of this year.
Sales in Brazil, joint venture, EUR 166 million in third quarter , and again to remind that those are not included in the consolidated sales. Before moving to next, view, just to remind and comment also that we are expanding production capacity in the U.S. in Obernburg, as the grid investments are supporting demand for transmission wires, one of our key businesses over there. That is helped, and we are leveraging on our local U.S. footprint to enforce our position there. In BBRG, our ropes business, synthetics business, is performing well. However, in steel ropes, we have seen a bit softer market conditions. We have seen weak demand in North America, partly due to tariff uncertainties, but also in Europe from lower mining activity, and we expect soft demand to continue also during the rest of the year. Synthetic business is performing well.
Strong performance from the newly acquired Beckwith Flintstone. Also, integration of those businesses has been done well. We continue to optimize our production footprint with the regional site closure now in Scotland, and we are now consolidating our activities to Belgium. In the synthetic ropes business, we were impacted by lower hoisting demand, especially lower elevator demand in China and Europe, as reflected in the subdued construction environment. New long-term sales agreement was signed for elevator hoisting belts with a key OEM. That has also a bit strengthened our position because earlier we were focusing more on core side. Then specialties, where we saw some positive signals in, in North American flooring market in third quarter , after the slow first half of the year. Positive momentum in India and Middle East has also continued, and we see nice growth opportunities there going forward.
Weak demand in Europe has impacted volumes and in prices due to the subdued construction market. That was also visible already during the earlier part of the year. On the tunneling side, we have won some new projects during the recent months and weeks, and that provides us greater visibility for future volumes. If you look at the other segments, in specialties, in hydrogen, weak demand has continued, and that is also a reason why we have decided to pause production in Verviers to address demand slowdown. However, I want to remind that we do continue our hydrogen-related production in China and Japan, and we continue our development work with the key vectorizer OEMs to continue our progress in the area, and also to strengthen our position for the growth when that comes.
There is, to hydrogen, we have seen weak demand in filtration and fiber end markets. In combustion technologies, that business has been resident in North America and China, while there have been challenges in Europe. In hose and conveyor belts, we saw some volume growth in Q3. Now handing over to you, Yves, on summary and outlook.
Yeah, thanks, Seppo. If you look at third quarter of this year, I would say a good stable sales, satisfied with the sales in a very challenging market environment, where we see some volume growth in some businesses and some regions, some country geographical mix evolution. We have been very well navigating the challenges, or the potential headwinds of the tariffs. We continue to focus on what we can control, and of course, that's cost optimization, that's balance sheet management, it's cash flow generation. Let me give some comments on the footprint changes we've announced. First of all, the consolidation of the synthetic ropes production in Belgium. As mentioned by Seppo, the business development performance, but also as a pipeline of projects for the synthetic ropes, is developing very well. We concentrated all the production into the Belgium operations.
On the other side, more driven by a market delay, as mentioned, we had unfortunately to put on hold the production site in Verviers and focus supply from China and Japan for the business for the upcoming two, three years. We keep on focusing very much on good cost evolution, both into SG&A, but also in our footprint evolution over the upcoming years to really be competitive in a global market, and we expect also very good cash flow generation for 2025. We continue to scrutinize the CapEx spending, and since growth platforms are well invested, there's no additional CapEx needed there. We continue with the share buyback, where we are almost half, we did half of the program of EUR 200 million, so EUR 100 million has been completed year to date.
From a full year outlook point of view, we are targeting a sales of EUR 3.7 billion and an EBITu margin of 8%. Having said that, I hand over, Dries, for the Q&A.
Yes, who will we take first in the queue for questions?
Thank you. Ladies and gentlemen, the floor is open for your questions. If you have any questions or comments at this time, please press star one. We do ask, if listening on speakerphone today, you please pick up your handset while asking the question to provide optimum sound quality. Once again, please press star one on your phone at this time to join the queue to ask a question. Please hold a moment while we poll for questions. Thank you. Our first question today is coming from Wim Hoste with KBC Securities. Your line is live.
Thank you, and good morning. I have a couple of questions around rubber reinforcements, and then a follow-up on CapEx. First on rubber reinforcements, China is fully utilizing capacity. Can you maybe give some or shed some light on the capacity utilization levels in the other regions? I am also very interested in the current profitability breakdown per region, if you can shed some light on that. Yeah, how is China doing versus the rest is basically the question. Also, is there any impact from Zenith, or from competitive pressures on pricing in China, if you can also elaborate on that?
That's on rubber reinforcement, and then the follow-up on CapEx is, can you update us on, given the investments you're starting in the U.S. or you're undertaking in the U.S., how much the full year CapEx budget would then be, and maybe also shed already a light on 2026 regarding CapEx? Those were the questions. Thank you.
Thank you for the questions. I propose I start with the RR, on the capacity utilization and also on the competitive landscape, and then Seppo, if you can give some perspective on what that means in terms of profitability by region. Basically, as mentioned, strong demand in the whole automotive sector in China, and we tend to pull through to tire cord. Plans are fully loaded, between 95%-100% full utilization. We continue to work, of course, to optimize the output of the existing footprint we have over there. In terms of competitive landscape, the overcapacity, as mentioned before, has been there before the last couple of years, correct? No drastic change there, except then, the Zenith further scaling up.
You see that we are holding a very good position in China and a good balance of market share and profitability. I would say, in terms of the regional mix, I think Europe and the question on, is it Europe?
Yeah.
And U.S.. Yeah. From a figures point of view, top of my mind, I think it will be around 60%, 60%-65% of utilization in Europe and U.S., so close to 70%. Yeah.
Great. As to per each and our profitability, this is, of course, a trading update, so we do not go into profit and loss more in detail, but more on general higher level. I think the challenge, of course, is that when looking at the profitability in some regions, and as the volumes are shifting more and more to China and, and Chinese, not Chinese market, but more to production in China, is, of course, that how you manage your business portfolio. Where our team is working very much is on focusing on customers who appreciate quality service, innovative product performance, and there we are able to, of course, get better margins than on those customers who are only interested in the volume and the good of the volume.
I think that our team has been doing a good job, and that if you look at the year-to-date figures we reported for the first half in RR, I think it's a proof point that we have been able to keep profitability on a good, good level in RR despite the pressures on profitability-related pricing of some of the competitors. Your question on capital expenditure, as Yves mentioned, we have EUR 145 million for this year, as expected CapEx. We are well invested in our growth platforms.
EUR 145 million is a reasonable figure, keeping in mind our maintenance needs, which is roughly half of that EUR 145 million, and that leaves us still with CapEx that we can spend on some growth projects as well as improvement projects, as well as, for instance, energy efficiency improvements that we are working on in various plans. When it comes to next year CapEx, we will come with more detailed guidance relating to next year in connection to our full year report in February, and then we can share with you more outlook there.
Yeah. We will come right to it. Also, question on CapEx in the U.S., is that correct?
No, it was a more general CapEx, given that you announced some investments in the U.S., but I think the question has been answered. Thank you very much.
All right. Thank you.
Thank you. Our next question is coming from Frank Claassen of Degroof Petercam. Your line is live. Sorry, Frank, you may be on mute, sir. Hello, Frank?
Can you hear me now? Yes?
Yes, sir.
Good morning. There I am. Thanks. Sorry. Good morning. Two questions, please. First of all, on your margin guidance, you've lowered it, let's say, from the range 8%-8.5% to the lower end, to 8%. Where do you see the gap, let's say, the difference between that, those margins versus a couple of months ago? Why, why have you lowered that to the lower end? Let's put it this way. That's my first question. And secondly, on the import tariffs in the U.S., have we now seen, have you been able to pass it on all now, or is there still some to come? And how is the local demand environment, reacting? Do you see impact of these tariffs or, yeah, some, some words on that, please? Thank you.
I propose I start with the last one on the tariffs in the U.S. and the situation on the economic activity in our volumes there. I think we can say that we are now in a stable situation, correct, where the import tariffs are clear, translated also in terms of agreement with our customers, what it means in terms of pricing. We've seen, of course, a local uptick in the wire price in the U.S. as an input material, and that means also for us translating that to our customers, and that has been done. Secondly, we see a slightly better local demand, but not yet, I would say, to the expected benefit of the import duties, which is to promote local production.
I think it's too early to see that, but certainly we see a slightly increase in that amount for local production.
When it comes to 8% EBITu margin that we are guiding now for full year, first of all, like you said, it is within the guidance range we had given earlier from 8%-8.5%, but at the lower end of the range. If you look at the businesses and also, like commented, I think we have seen positive momentum to continue in SWS as an example, but also, like mentioned in the report, we have seen the soft market to continue on steel ropes as an example, and we see still quite a lot of uncertainties when it comes to year-end in many other businesses, like construction.
We saw some improvement in the volumes in Q3, but wind demands are always a bit shaky in construction business, and typically they slow down, and in some other businesses as well. I think it's very much still around the uncertainties that we have seen and continue to see, partly because of the tariffs and partly because of the economical situation, which is not really picking up currently compared to past.
Okay. Thanks. Thank you very much.
Thank you. Our next question is coming from Alexander Craeymeersch with Kepler Cheuvreux. Your line is live.
Hey, hello. Thank you for taking my questions. On steel wire solutions and BBRG, I think last quarter there were delays in American energy and utility sector that was attributed to the tariffs uncertainty. Now, this quarter I see that this is somewhat resolved, reflected in the order book. However, did in BBRG that uncertainty persist? Could you maybe elaborate on the uncertainties or the differences in the underlying dynamics between the two segments and maybe explain why the uncertainty has been alleviated for one and not the other? Second question, if you care to give an update on the midterm guidance, because I think there's a midterm guidance of higher than 10% EBIT margins. Do you now expect that to be like 27% or 28%? I know you have never been down a date, but it would be handy to know.
And then third question would be probably a quick one. It's basically on the steel tariffs in Europe. I think as of next year, I think steel tariffs are going to be implemented. Would you consider that a net positive or a net negative for Bekaert in the current state that the tariffs are going to be implemented? Thank you very much.
All right, Alexander. Good. Okay. Let me take them one by one, and please, Seppo, feel in to complement. Your first question was about the difference about the business opportunity or challenge for SWS and BBRG in the U.S. based on the tariffs. What we see, SWS, the main business we do in energy utilities is basically the reinforcement cable for overhead conductors. The initial situation in the U.S. was that, let's say, there were import duties on the steel components, but not on the finished conductors. That has been, through the local businesses and ecosystem players, clarified, correct? There is a more competitive situation again now for local production.
I think it was a time to, let's say, I would say, settle down the tariff setup for the full value chain. We saw that in Q3 and also for the rest of the year, a good continuation of that business. While that value chain or supply chain setup for ropes is different, correct? There is the local production, there is the export to Canada. There is not a competitive landscape then in SWS where there are a couple of competitors for these finished or the reinforcement cables for conductors, while, of course, the competitive landscape on ropes is different. There is a really clear derivative why that is slightly improving. On the midterm guidance, as communicated, I think the mid of the year, correct?
In the capital market day, based on the situation, the plans and the outlook on the sustainability agenda that we saw at in 2023, we were predicting a 10% EBIT levels, from 2026 onwards. We already updated in the last update, that perfection, perception or projection, I have to say, based on the delay in the growth platforms and driven by, by, a different, sustainability agenda on, hydrogen and also some other segments like the floating offshore wind. We moved that target to a, a midterm target without a specific, date, and it'll mainly dependent on the program of further scaling of growth platforms, new growth platforms, and also economic situation.
The good thing is that with all the actions we've been taking, we have created a lot of operational leverage, which means that with an economic uptick, that should certainly be a lever to work towards that 10% EBIT. I think then the last question, if my memory is good, was about Europe, correct?
Steel tariffs.
Steel tariffs in Europe, Alexander. Yeah. Good. I think we are still in the middle of the deployment of the policies of the European Commission, correct, which were to protect, let's say, safeguard the steel industry in Europe with the reduction of the quota on tariff-free imports and also a doubling on the import duties, correct? This is, mid of next year, if I'm right, will be the implementation date. That is in full, proper preparation, still needs to be voted in the European Parliament. We will have to see. We are monitoring the same like we did for the U.S., in terms of our supply chain, our flows, our competitive situation, what it means for the different businesses and the different flows.
Coming back to the intention to protect the steel industry, it's not only to protect the upstream, but it's also to make sure that the whole steel industry in Europe is having fair competition with imports. I think these discussions are, if I'm right, informed, still ongoing on the European level to make sure how the full value chain in the steel will have a fair playing field. It's a little bit too early to say concrete, but we can confirm that we are clearly close to it and monitoring what opportunities and challenges this gives, and we will adopt accordingly.
Of course, key is that, like in the case of U.S. tariffs, we will monitor the situation and then react fast if we see that the steel prices are increasing to pass through the raw material price changes, as always, the largest beam. That remains to be seen what is the effect and when.
Correct, Seppo. If you look at it from the intention of the Metal and Steel Act for Europe, it is to make the whole steel industry more competitive, and that should not lead to price increases normally, but should lead to more local production, more competitiveness for the whole industry.
Okay. Thank you. Thank you. Our next question is coming from Martijn den Drijver with ABN AMRO. Your line is live.
Yeah. Thank you, Operator. Good morning, gentlemen. A number of questions. I'll do them one by one. Yves, coming back to the European import duties, I understand that, if I understood correctly, that in the U.S., the local wire rope prices have gone up after the import duties. We don't know the outcome yet of the European vote, but let's assume that Europe votes for these import duties. Wouldn't it be fair to assume that prices in Europe would also go up? And if so, given the price pressure that we've seen lately for various reasons, how would you deal with that in that situation? That would be question one.
Good. First of all, let's see, Martijn , what's going to happen. It's correct that you see that the first impact in the U.S. was wire rope price out, up, but the normal intended of the measure is that there would be more local steel production, correct, which, the utilization of the mills in the U.S. and in Europe are low. That's also why these protective measures are taken. Economically, people should expect price reduction and efficiency to make the whole downstream industry more competitive. I think we need to monitor and see how it plays out first in the U.S., but then also, and you're right, the next step is here in Europe.
If it's, let's say, two scenarios, if it would lead to wire rope prices increasing in Europe, there are a couple of levers we have. One is how much we source wire rope locally here in Europe and how much we import, including the free quota that there are, correct, to have a competitive offering. Secondly, on some of the product segments, depending on the competitive landscape, do we compete with local competitors? Do we compete with import products? We will pass through, correct, these increases like we've been doing in the U.S.. There could be third segments where the competitive landscape is strengthening, or where we would, on the other hand, have more competitive advantage of being local. I think your assessment is right, and we have to see what's going to happen.
Okay. That's fair. Then, on RR, forgetting about Q4, can you tell us a little bit what your clients are saying when they talk about 2026 in the truck bus segments and also in the PCR light commercial vehicle segment? What are they telling you in terms of, well, RFPs, RFQs, just a general sense of how they're thinking about 2026, please?
Of course, it's a little bit early. We're in the discussions with our contracts, with our customers, you know, that we make with most of them pretty long-term agreements for the upcoming years and have long-term relationship. And so we're in the midst of discussing the volumes, the shares. I think in general, I would say, without disclosing specifics, but overall, I think we need to, the tire demand is a pretty mature business, correct, in terms of global demand with some left and right, some growth, but also let's assume on average stable or plus 1%-2% growth, so moderate growth in the whole tire industry. Then you have the evolution of the competitive landscape of the tire makers, competitive landscape between the Indian, Asian, European, U.S. players. And there we need to see, there are actions, correct?
I, -- we've seen evolutions in market share of some players, and of course, these players are not standing still and they are taking actions to recover a market share. That's what we expect for next year. Again, I want to repeat, we are in a good position that we are supplying all of them and we are present in all regions. That's the dynamic I see playing out next year.
Good. Thank you. Moving on to BBRG and specifically A-Cords. A-Cords volume was down in 2024 by roughly 1% year to date, minus 7%. That's mainly elevator driven. Can you talk a little bit about what you're seeing specifically in the elevator business? Not so much the regions, that's specified in the press release, but talk a little bit about competition, perhaps also touching a little bit on the demand side. Non-RESI Europe is not going to improve material. China has plans, but, you know, they've had plans in before. What are your thoughts on the elevator market going forward?
First of all, from a competitive landscape, we do not see an evolution or new elements in the advanced cords there. As you mentioned rightly, the downturn we are in, first of all, it is still good business for us. Of course, from a top line point of view, it is linked to the China construction. We know that half of the elevators are installed and are maintained in China. That construction market revitalization in China is a key role. What we are doing in the meantime as a player is further, let's say, work on innovation with our main customers, and also being part of their strategic approaches into markets like China. That is how we are working on this segment.
There's no immediate need to do something about the production footprints at this point in time.
No, you mean in terms of expansion or in terms of different locations?
Cost containment, correct.
[crosstalk] No, we have no expansion or, but how do you? No, also no, no need to, right, or, no, small, small adjustments, but not really significant.
More normal continuous improvement type of actions, but no, no capacity reduction needs if that's what you refer to.
Okay. Great. Thank you. My last question with regards to the additional cost saving measures that you've announced, can you elaborate a little bit on the effects of those cost savings? In millions of Euros and when to expect them. What do you mean exactly with that, optimizing capacity in Japan and I can't think of the other region? Maybe a little bit of additional color there, please.
Yeah. Let me start with the helicopter view, and then Seppo can chime in with how it flows to the P&L and what we expect. Anything's not new. What I'm sharing is that the strategy from an organization point of view is to go really to a BU-centric organization where each of the business units have really end-to-end responsibilities and capabilities. One of the streams is that we've been right-sizing and making a leaner corporate structure and integrating as much as possible into the BUs. That's one. A second initiative we are taking, and there's continuity, is of course on the journey of shared services, digitalization, and expanding that, bringing shared services together, of all the functions, having really integration and digitalizing.
There are initiatives ongoing, some announced, on footprint consolidation. We, of course, are competing sometimes with competitors who have bigger size, more scale. It is important that through the journey of the footprint, we continue to look at opportunities. That does not mean closure of factories always because the business is going down. Take the example of synthetic ropes where the business is growing year on year, but we consolidate, we strengthen the footprint depending on the needs of the local. Another driver of initiatives is the synergies between the plants. Even if we have different locations, how do we manage plants across businesses? There is a number of initiatives that we take step by step in making the organization lean and agile.
The big benefit we are creating is that, despite some of the volume challenges, we deliver strong performance and we, of course, have good operational leverage moved forward.
Yeah. And then more specifically, on overhead cost improvements and reductions and SG&A-related actions, good proof point is that if you look back to our first half report, you could see there already EUR 20 million plus reduction on overheads. We continue that reduction program through the rest of the year also going beyond New Year. We keep continuously focused on those costs. That means streamlining the organization and taking actions to reduce costs.
All right. Thank you very much, gentlemen. Those were my questions.
Yep.
Thank you. Our next question is coming from Louis Billon with Alpha Value. Your line is live.
Hi, good morning. My first question is a follow-up on the capacity utilization in the rubber reinforcement division in China. If I understand, the capacity is fully loaded and do you expect to increase this capacity? Do you think that because this capacity is, maybe you can be more selective right now and in the future, so you have a high pricing power and maybe in the future your pricing power will be lower if you cannot increase the capacity?
Good. No, so, in terms of, it's correct that the utilization is high this year, was also last year pretty high, even a little bit more higher this year, correct? To strong demand, that's great. We have four plants in China. We have no plans to expand capacity in the near term, correct? As mentioned, there is, since more than 10 years or decades, overcapacity in the China tire cord market. In that context, we've been performing very well on selecting, as Seppo said, the businesses we want to have and the customer we want to work with. That remains our strategy.
Having said that, within the four walls, I would say, of course, like every industrial company, we are doing, let's say, optimization to maximize what we call the OEE and the, or the equipment utilization, to improve the output and create more leverage. We have currently no plans to expand capacity in China.
Okay. Thank you. Maybe for the steel wire solution, could you give us a kind of indication of the split between the high volume in China in automotive and the green investment in the U.S.? Which part reflects the price increase and which part reflects the volume increase in this division?
The most relevant is the energy utilities in the U.S., huh? That's the bigger driver than the automotive side.
Okay. Thank you.
Thank you. Our next question is coming from Stijn Demeester with ING Financial Markets. Your line is live.
Yes. Good morning. Thanks. Two questions from my end. First one is on pricing. When you would separate the pricing impact from the cost to effect, in your group, revenue, are there strong differences between the different divisions? Secondly, a follow-up on Alexander's question on EU trade action. Can you share your current sourcing distribution in Europe? How much is now being sourced from Asia? Thanks.
Yeah. Let me take the second one and perhaps you could take the first one. If I understand correctly, standard, your question is on the our sourcing in Europe on wire rod and steel, correct? Is that your question?
Correct. Yes.
Yeah. Correct. For Europe, we have a pretty local-for-local sourcing strategy with wire rod players. B oth 80% is sourced locally, complemented with some other sources and coming from the U.K. or even import Japan, depending on the wire rod grade and the needs we have. In some ways, basically a local-for-local, yeah, today. We have flexibility on what we can do.
Okay. When it comes to pricing past different BUs, I would say that we have a good capability in all BUs across the board to pass through the raw material price changes to our customers. That works well and we are very much on top of that and follow very carefully, continuously, that we are not falling behind. I think that the pricing differences are developed, but it is then more driven by mix in changes when it comes to product portfolio or geographical mix. Example in construction, for instance, volumes in the U.S. have been lower in relative terms compared to U.S.. That has meant that average prices are different because of the different markets served. Or in SWS, for instance, there has been a bit more accurate compared to past versus other business.
Those are driving sometimes up or down to average price, but that's then a different compared to, to pass through mechanism of the raw material price changes.
I think in the past, you separated the price mix from the, from the past through, at least on group level. Can you get, can you do this for Q3?
It's about 50/50 in the latest quarter.
Okay. All right. Thank you.
Thank you. As we have no further questions on the lines at this time, I'd like to hand it back to management for any closing remarks.
No, thanks for, first of all, joining the call. Thanks for the good questions. Hopefully that, our perspective gives you some additional insight and wish you a nice day and nice weekend. Thank you very much.
Thank you.
Thank you, ladies and gentlemen. This does conclude today's call. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation.