Welcome to the Vicat 2025 full year results presentation. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answer session, all the participants are able to ask questions. Now, I will hand the conference over to Guy Sidos, Chairman and Group CEO, Hugues Chomel, Deputy CEO and Group CFO, and Pierre Pedrosa, Head of Investor Relations. Please, sir, go ahead.
Thank you. Good afternoon, ladies and gentlemen. Welcome to Vicat's 2025 results presentation. I'm Guy Sidos, Chairman and CEO of the Vicat Group. Alongside me are Mr. Hugues Chomel, Deputy CEO and CFO, as well as Pierre Pedrosa, Head of Investor Relations. On slide two, as a preliminary remark, I would like to draw your attention to the fact that the forward-looking information presented here reflects our current assessment of expected trends across the Group's various markets and should not be regarded as forecasts. On slide three, 2025 is part of a solid and sustainable performance trajectory, illustrating the strengths and resilience of Vicat's business model. Consolidated revenue amounted to EUR 3.85 billion in 2025, affecting an average annual growth rate of nearly 7% over the past five years.
EBITDA reached EUR 771 million, also representing average growth of close to 7% over the same period. ROCE remains stable at 8.1%, pending the full contribution of the new plant in Senegal. Lastly, the group's leverage ratio continued to decrease, reaching 1.49x in 2025, further strengthening Vicat's financial structure. These results once again demonstrate Vicat's ability to consistently combine operational performance with financial discipline in a demanding environment. Let's move to slide 4. As a reminder, Vicat's business model is built on several key pillars that underpins its resilience. First, a family shareholding structure and a long-term vision grounded in continuity, which enable us to pursue a consistent and sustainable industrial strategy. We are a cement-focused business and benefit from a modern, high-performing industrial asset base, vertically integrated across the value chain.
We have a multi-regional model supported by a decentralized organization, which allows us to operate efficiently and to respond to the local needs of our markets. Vicat also has a long-standing tradition of innovation with strong R&D capabilities, from the invention of artificial cement in 1817 to today's low-carbon cements, such as Calcia in France or Progresso in Switzerland. We are positioned as a key player of industry's decarbonization. Lastly, we benefit from a geographically diversified portfolio across both developed and emerging markets. These pillars are the core of Vicat's identity and provide the foundation for a sustainable and robust model, fully aligned with the ongoing transformation of our sector. Slide 5 provides an analysis of the group's investment cycle over the past 10 years and how we have balanced our strategic priorities with the financial discipline.
Following an initial phase between 2015 and 2018, during which investment levels remained stable, we made the decision from 2019 onwards to accelerate capital expenditure at a time when funding conditions were particularly favorable. Since 2023, in a context of higher cost of financing, we have been able to capitalize on these past investments to generate high cash flows and deleverage our balance sheet. We do this while maintaining a level of investment consistent with our initial goals. Turning now to the key highlights of 2025 on slide 6. In a complex international environment, the group delivered solid results. Organic revenue growth came in at 3.3%, accelerating to 8.1% in the first quarter.
EBITDA reached EUR 771 million, representing organic growth of 3.7%, compared to a record year in 2024. However, the foreign exchange headwinds had a significant impact, resulting in a slight EBITDA decline on a reported basis. For the third consecutive year, the group generated strong free cash flow amounting to EUR 224 million in 2025, and continued to reduce its net debt. Lastly, we made further progress on decarbonization. We reached an important milestone in securing the financial of VAIA, our flagship, our flagship carbon capture project in France, with the award of two subsidies at both the European and French levels. Altogether, these elements once again illustrate the strength of Vicat's model, which is able to combine operational performance, financial discipline, and decarbonization.
In France, as shown on slide seven, the residential market has gone through an unprecedented slowdown and is now at its lowest level in 25 years. As far as we are concerned, we have lost 600,000 tons of cement over the past three years, representing nearly 20% of our production. Despite this environment, France showed remarkable resilience in 2025. After six consecutive quarters of decline, volumes stabilized in the second half of 2025 at a low level, with a slight rebound in the first quarter. While visibility remains limited, notably due to the political context and the upcoming municipal elections in France, this development is encouraging in the context of reduced interest rates. Let me remind you that the residential needs in France remain very significant.
In this respect, the Relance Logement plan, recently announced by the government, is specifically intended to address this situation by supporting the construction of new housing. As a result, the conditions are gradually aligning for a moderate and progressive recovery from 2026 onwards. With its long-standing roots in France, which represents 31% of the group's revenue, and with its available capacity, Vicat is very well positioned to benefit from this recovery as soon as it materializes. Still in France, as shown on slide 8, the TELT project. TELT is the Alpine Lyon-Turin Tunnel. So this project contributed to activity in 2025. It is currently the largest civil engineering project under construction in Europe.
The gradual ramp-up with the commissioning of the tunnel boring machines is expected to support cement consumption in 2026, and even accelerate it from 2027 onwards. Overall, we have contractually secured more than 1.3 million tons of cement, as well as around 4 million tons of aggregates over the lifetime of the project. I would also highlight works package named CO11, which we won jointly with Vinci. This contract covers the treatment of excavated material. In total, nearly 24 million tons of material will be sorted with the objective of recycling of half of it, and we have recently inaugurated our first treatment station. And today, the TELT project represents a major growth driver for operation in France. It will provide strong support to our volumes over the next 7-8 years.
More broadly, the outlook for the infrastructure segment in France is promising, with good visibility over the coming years. The launch of the French access work for TELT, which is in addition to the main TELT tunnel. The future EPR nuclear reactors, notably near our Montalieu-Vercieu plant, and the construction of the so-called PANG aircraft carrier. It's the new generation of aircraft carrier in France, in Toulon. And these are a few examples that will drive up our activity in the coming years. In Brazil now, on slide 9, the group delivered a solid performance in 2025, supported by favorable market momentum and sustained commercial development in the Midwest region, notably in Brasília and the state of Goiás. In 2025, we completed the acquisition of Realmix, a ready-mix concrete player in Goiás.
This transaction enabled us to further strengthen our vertical integration and to secure additional cement and aggregate volumes. Consolidated from September 1, 2025 onwards, Realmix made a positive contribution to our results at the end of the year. In Brazil, we generated EBITDA of EUR 63 million in 2025, driven by your market growth, strong performance of our commercial teams, the contribution of Realmix, and the quality of our initial asset base. Let us now turn to Turkey on slide 10. Our results grew strongly in 2025, with EBITDA reaching EUR 58 million, up by nearly 32%. The group operates in Central Anatolia, where our cement volumes increased by 19% in 2025.
The construction market in this region benefited from favorable demographic trends, with populations migrating from the areas affected by the 2023 earthquake towards the Ankara region. In addition, in 2025, the government accelerated infrastructure projects, not only around Ankara, but also in Northern Anatolia, in order to rebuild the areas impacted by the earthquake. We're also seeing some production capacity being redirected towards export markets, which favors domestic players such as Vicat in Turkey. And in the current hyperinflationary environment in Turkey, we have been able to adjust our selling prices in order to protect our margins. On slide 11, in Egypt, the remarkable turnaround of our performance continued in 2025. EBITDA once again increased sharply, reaching EUR 61 million, up by nearly 71%-79%, sorry, with the margin rising to 37.3%.
Export volumes remained sustained, and the rebound of the domestic market was confirmed in the second half of the year, notably with the launch of several large real estate projects. Longer term, the region continues to offer attractive prospects for the group, particularly through potential reconstruction opportunities that may arise in certain areas currently affected by conflicts. Let us finally turn to Senegal on slide 12, where we have made a major investment over the past few years. After a start-up in June 2025, Kiln 6 has continued to ramp up, delivering first tangible financial contributions in the first quarter. As a reminder, this modern, high-performance facility is intended to replace Kilns 3 and 4, and to eliminate our clinker imports, which has already been achieved.
It will also accelerate our decarbonization and will generate cost saving of EUR 20 per ton of cement in the coming years. The ramp-up of Kiln 6 will continue this year and will be a key driver of the group's performance in Africa in 2026 and 2027. I will now hand over to Hugues Chomel for a more detailed review of our financial statement.
Thank you, Mr. Sidos, and good afternoon, ladies and gentlemen. I will start with the main highlights of the group consolidated income statement on slide 13. Revenue amounted to EUR 3,854 million, representing an organic growth of 3.3%, but remaining broadly stable on a reported basis, due to a negative foreign exchange impact of EUR 242 million. EBITDA reached EUR 771 million, up organically by 3.7%, in line with the +2% to +3% target communicated last July. The EBITDA margin therefore stood at 20%, consistent with our medium-term priority. Net income group share increased by 6% at constant scope and exchange rates, reaching EUR 275 million.
Despite a particularly negative foreign exchange impact in 2025, the quality of the group results demonstrate once again our ability to deliver solid operational and financial performance in a challenging economic environment. On slide 14, you can see the evolution of the revenue by region in 2025 compared with 2024. At constant scope and exchange rates, the solid organic growth delivered across the group reflect contrasting trends from one region to another. France recorded a slight increase on a reported basis, supported by the gradual stabilization of the cement business in the second half of the year, as mentioned by Mr. Sidos, and by the positive contribution of the integration of Cermix since January 1, 2025. The Europe region-...
Grew by 7.9% on a reported basis, benefiting beyond the appreciation of the Swiss franc from the recovery of the market in Switzerland, Vigier's exposure to major infrastructure project, as well as the commercial success of our low-carbon offering. Americas posted a decrease, mainly reflecting the slowdown in United States. This decrease was, however, partly offset by the strong performance in Brazil. In U.S., interest rate to remain high throughout the year, penalizing the housing sector. Uncertainty resulting from the tax and tariff changes created a climate of instability, which impacted the non-residential markets. In this environment, the group performance was contrasted across regions, with growth in the Southeast and a sharp decline in California. In Asia, revenue recorded a slight organic decline of 1.5%.
Activity in India remained volatile due to a highly competitive environment, particularly in the south of the country, which put pressure on pricing despite an improvement in the second half of the year. The Mediterranean region stood out, delivering organic growth of more than 30%. Lastly, Africa posted a slight decrease of 2.9%, despite the strong performance in Senegal, notably driven by an acceleration in aggregate sales following the restart of major public infrastructure projects. As you can see on the chart on the right of the slide, the group organic growth accelerated throughout the year, reaching +8.1% in the fourth quarter. Now, turning to slide 15, to the evolution of EBITDA, whose main drivers are illustrated on this chart. The increase at constant scope and exchange rates is mainly explained by a positive volume effect in cement, concrete, and aggregates.
Overall, pricing developments allowed to offset cost increases, which were notably driven by wage inflation. Industrial performance also contributed positively, notably in Senegal. Foreign exchange had a negative impact of EUR 46 million. This reflects the depreciation of all currencies in which the group operates against the euro, with the notable exception of the Swiss franc. Let me remind you that 59% of the group revenues is exposed to non-euro currencies. Overall, EBITDA recorded a moderate limit decrease of 1.6% compared to 2024, which was a record year for the group. Therefore, this can be considered a very, very solid performance, given the environment we faced in 2025. Moving to slide 16. 2025 was also characterized by a strong cash generation. We maintained strict investment discipline.
Net CapEx amounted to EUR 299 million, down compared to 2024. CapEx was split more or less evenly between maintenance CapEx and strategic CapEx, including the cash outflows related to Kiln 6 in Senegal. This discipline will be maintained in 2026, with expected CapEx of around EUR 219 million. For the third consecutive year, the Vicat Group generated strong free cash flow, amounting to EUR 324 million in 2025, and illustrating the highly cash generative nature of our business model. As shown on slide 17, this free cash flow of EUR 324 million notably reflects a further reduction in working capital requirement, and as I just mentioned, control over CapEx. Cash conversion rate stood at 42% in 2025.
On this basis, and taking into account the group's market capitalization at the end of January, the CapEx free cash flow yield is around 9%, one of the highest in the industry. This highlights both the strength of our cash generation and the rerating potential that remains significant despite the share price increase over the past year. This cash generation enabled us to continue on the leveraging trajectory. As shown on slide 18, the group net debts decreased by EUR 85 million in 2025, to reach EUR 1,151 million. Leverage ratio stood at 1.49x EBITDA, marking a further reduction in line with our priorities. On slide 19, you can see a detailed breakdown of the group net debt at the end of 2025....
It is characterized by a well-balanced maturity profile, with an average maturity close to 5 years. Average interest rate was 3.86% before hedging in 2025, down significantly year-over-year. With gross cash at EUR 528 million and EUR 877 million of available undrawn credit lines, the group benefits from strong liquidity, the resources needed to continue pursuing its development. Thank you for your attention. I will now hand it back to Mr. Sidos.
Thank you, Hugues. Let me now briefly comment on Vicat's climate performance in 2025 on slide 20. We made further progress towards our 2030 targets across all key indicators, particularly in Europe. In France, we continued to pursue a particularly ambitious trajectory. The reduction of the clinker rate to below 80%, because there was an increase in the alternative fuel rate to more than 70%, up 5 percentage points year-over-year. This made a strong contribution to the group's overall performance. In 2026, the Argile project in France focused on further reducing the clinker rate, as well as the ramp-up of Kiln 6 in Senegal with regard to alternative fuels, should accelerate the reduction of our emissions. Our actions also extend to innovation. You can see two examples on the left-hand side of this slide.
Product innovation with Progresso, that makes the first concrete of Switzerland, with emissions of less than 100 kilograms of CO2 per cubic meter. Process innovation with Catch4 Climate, which will be inaugurated this summer and aims to facilitate CO2 capture while reducing capital costs. You can see on slide 21, that at the group level, low-carbon cements accounted for nearly one quarter of total sales volume in 2025. This indicator, which we are presenting for the first time today, is calculated in accordance with the methodology defined by the International Energy Agency and adopted by France Ciment. In France, the commercial success of our DECA range continues. In Switzerland, nearly 100% of our offering is classified as low carbon, notably with products such as Progresso, which I mentioned earlier, and which is also enjoying remarkable commercial success.
We're also a leading player in low-carbon cement in California and Brazil. The carbon footprint of our products continues to improve, in line with our climate roadmap. This roadmap is supported by initial investments and by acceleration of our low-carbon innovations. Turning to slide 22 now. Regarding VAIA, our carbon capture project in France, we reached a major new milestone with the award of two subsidies at both the European and French levels. These awards demonstrate the credibility of our approach and our commitment. I will remind you that the VAIA project aims to capture and then sequester 1.2 million tons of CO2 per year at the Montalieu-Vercieu cement plant, Vicat's largest facility in France. The captured CO2 will be transported by pipeline to Fos-sur-Mer, which should then be liquefied before being shipped to its storage site in the Adriatic Sea.
This project relies on a complex value chain, involving several partners and operators at each stage, I mean, capture, transport, liquefaction, maritime shipping, and geological storage. The subsidies awarded to us for this project amount to EUR 740 million, combining French support under the Grand Projet Industriel de Décarbonation scheme and the European Innovation Fund grant. They are expected to be formalized through contractual agreements over the coming months. As a reminder, the estimated investment for the capture component of the VAIA project alone amounts to around EUR 700 million before subsidies. Government support is an essential condition for the project's economic viability, and we are currently continuing the feasibility studies with the objective of making a final investment decision by the end of 2027.
Slide 23 illustrates another important performance driver that Vicat has been working on for many years: artificial intelligence, which we are deploying as an operational tool to support our businesses. Our artificial intelligence initiatives are led by the Digital Factory 1817. ... That's the year of the invention of artificial cement. This in-house startup is based in Lyon and employing 22 people, also works for external clients. With AI, our ambition is twofold. First, at the service of industrial performance across our cement plants, or so-called RTO, for real-time optimizer solution, delivers tangible productivity gains in our facilities. It improves product quality and enhances the reliability of our installation. This tool has already been deployed at several pilot sites: Ragland in the United States, Péry in Switzerland, and Kalburgi in India, and we intend to accelerate its rollout.
We are targeting productivity gains of at least 5%. This is only the beginning. At the group level, this would translate into an increase in our capacity by around a year. This represents the equivalent of an additional cement production line with a very, very limited investment. Second, AI as a powerful tool for cost optimization. There are many potential use cases, and we have already validated three of them: improving concrete formulations, optimizing concrete and aggregate logistics, taking into account the location of our sites and those of our customers, and enhancing our procurement processes. Artificial intelligence is therefore fully part of our operational excellence approach, supporting the group's competitiveness. Turning now to 2026, on slide 24. Growth momentum is set to continue despite persistent macroeconomic and geopolitical uncertainties, and foreign exchange rates that are likely to remain volatile and unfavorable.
In this context, we remain confident in the group's ability to continue delivering robust performance, supported by its strong operational fundamentals. In 2026, at this early stage of the year, we cautiously expect slight growth in sales on a like-for-like basis, slight growth in EBITDA on a like-for-like basis, and net CapEx of around EUR 290 million. Regarding capital allocation, on slide 25, our policy is underpinned by strong free cash flow generation and consistent financial discipline. This policy is built on three pillars. The first pillar is the preservation of a solid financial structure, so continuing deleveraging and the maintenance of a strong liquidity. The second pillar relates to investment. We intend to maintain rigorous discipline while investing consistently with our industrial and climate objectives. Finally, the third pillar is the dividend.
We aim to maintain an attractive distribution policy with dividend growth supported by earnings evolution. This capital allocation reflects the balance we seek, strengthening our financial structure, investing selectively in the group's future, and continuing to deliver an attractive return to our shareholders. So let's now move naturally to the dividend on slide 26. Based on these 2025 results, and confident in the group's ability to keep delivering profitable growth, the board of directors has decided to propose to shareholders the distribution of a dividend of EUR 2 per share. Vicat stands out for its stable and highly predictable distribution policy. I will remind you that the dividend has never been reduced in the past 30 years. Let us switch to slide 27. Vicat is pursuing a consistent growth trajectory, supported by three midterm strategic priorities, which we are confirming today.
First, maintain an EBITDA margin of at least 20% over the 2025-2027 period. Second, continue our deleveraging. Finally, accelerate our climate roadmap with strong ambitions to reduce CO2 emissions and to promote low-carbon products. These three priorities underpin Vicat's strategy to deliver profitable and sustainable growth. On slide 28, to conclude, Vicat's growth in the coming years will be supported by clearly identified growth drivers, several of which are already underway today. First, Kiln 6 in Senegal, as I have already mentioned, it is a major lever of cost competitiveness that will have a material impact on our performance in Africa. Second, the TELT project, its contribution to our cement and aggregate sales is already visible, and it is expected to intensify supporting our activity in France over the coming years.
Also in France, the residential market is currently at a low point, which creates significant recovery potential. With more than 30% of our revenue generated in France, Vicat is very well positioned to benefit from this upturn when it materializes. Similarly, in the US, residential construction is currently at a low level and offers strong recovery potential. I thought this will be contingent to the interest rate, but cycle. Finally, the Mediterranean region offers significant mid-term growth opportunities, notably through potential reconstruction needs that may emerge in areas coming out of a prolonged period of conflict. These drivers reinforce our confidence in Vicat's mid-term trajectory, and we enter the coming years with a mission to pursue disciplined, sustainable, and value-creating goals. Ladies and gentlemen, thank you for your attention. Hugues and myself are now ready to take your questions.
Please note that we will take audio questions from analysts only. You can request to speak via the blue hand icon. We kindly ask investors to submit questions via the chat box below the player. The next question comes from Tom Zhang from Barclays. Please unmute your microphone.
Hi, can you hear me?
Yes.
Okay, great. Thank you very much for the presentation, new presentation format. So three questions from me, if I may. The first one, you've talked about, you know, significant price hike announcements in France this year. I know it's early in the year. We don't know enough about how this will develop, but I wanted to ask, in your guidance for slightly higher sales in EBITDA, what kind of realized pricing are you assuming in Europe? Would that be sort of low, mid, high single digit? Some color there would be interesting. The second question, just on the U.S., you talked about price absorbing the impact of cost inflation. Could you please elaborate a bit? Should we expect positive price cost in the U.S., and can you differentiate between the Southeast and the West Coast? And then the last one, just on CapEx.
So you guide for EUR 290 million, even though we have Senegal rolling off, which I think was about EUR 50 million of CapEx. Can you just give some color on the projects that you're now investing in that means the CapEx is fairly stable? Is that mostly growth CapEx, climate CapEx, maintenance catch up? Yeah. Thank you.
I will leave, Hugues Chomel to answer these questions.
Hi, Tom. Thank you for your questions. Indeed, we, as you know, the French market has some specific cost drivers. The evolution of electricity cost and the start of the implementation of CBAM, that push us to announce high single digit to low double digit price increases in the market. As you mentioned in your question, it is early in the year to tell where we stand. I would say a mid to mid high single digit would be a good realization, probably, and that would translate in a positive price-cost differential. Regarding US, it is even earlier in the year to give you a solid answer.
We did announce price increases in both regions, substantial, but as usual, they do apply on April 1, and our ability to get them through and to have them stick will heavily depend on market context when they roll out. And that's a little bit early for me to give you a prediction on that. We assumed in our guidance, I would say a neutral price-cost differential. If they would fully materialize, that would be an upside. Regarding CapEx, indeed, we did guide to EUR 290 million for a new reduction compared to last year. This has always is including about half of maintenance CapEx.
Still, some last amounts regarding Senegal, with the last milestones of a contract, and first, a pre-acceleration in our decarbonization spend to secure our 2030 objectives.
That's clear. Thank you. Sorry, could I just follow up just on the European pricing? So you very helpfully said for the U.S., you're assuming in the guidance a neutral price cost differential. And then you said mid or high-
I spoke about France, Tom, not Europe.
Oh, that was for France. Okay. So a neutral price cost differential is in your guidance for France?
Slightly positive.
Slightly positive. Understood. Thank you very much.
And I didn't mention Europe, which has a slightly different cost base, specifically on electricity, where we do expect a positive price and environment.
That's clear. Thank you very much.
Thanks.
The next question comes from Ibrahim Houmani from CIC. Please unmute your microphone.
Hello. Hello, thank you for taking my question. I have three, if I may. The first one is on France. In France, the operating leverage is huge. In case of a 1% increase in volume, what could be the impact on the, on the EBITDA? My second question is on Senegal. Do you confirm that the EBITDA contribution will be higher in 2026 than it was in 2025? My last question is on CapEx. Could you give us, the part of, maintenance CapEx, and what's your level of, flexibility, to reach your 2027, leverage targets, please?
Yes. You are right. In France, we do have a high leverage, operational leverage in cement. We as well have a large share of our activities. You will understand that this is quite sensible information. We do not disclose as is, but you can observe from the volume impact from the past years, the tremendous impact of volume fluctuation. In Senegal, indeed, as mentioned by Mr. Sidos earlier, the initial startup of the kiln was in June. It did ramp up very gradually and start to regularize a little bit in Q4. So the initial contribution comes out of Q4 only.
So we do expect it to contribute more heavily and to gradually improve both energy efficiency and alternative fuel increase. I remind you that, as mentioned by Mr. Sidos during the presentation, the midterm saving objective is EUR 20 per ton of cement sold by the facility. On CapEx, I believe I just gave the information to Tom, but indeed, we do expect about half of our CapEx to be maintenance. So roughly EUR 140 million-EUR 150 million.
Thank you very much.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad.
We have two written questions from Isaac Osio from Onfield Investment Research. So first question on the guidance: With price increase in France, savings from the new kiln in Senegal, strong Egyptian exports, and improving conditions in Turkey, it seems organic EBITDA growth in those regions could be more than slight. Does your guidance suggest a sharp EBITDA drop in the U.S. and India, or is it simply conservatism early in the year with room to upgrade? I will hand it over to management for the answer.
Yes, yes. The answer is in the question. Everything you said is a momentum, but we are very cautious at this time of year. Guidance could be disappointed, but would like to share a few comments. Our guidance is slight growth of sales and EBITDA on the like-for-like basis, which is expression for cautious optimism of a positive orientation for main markets with an acceleration in H2. In France, you see, after stabilizing in H2 2025, the residential market is expected to continue a soft landing with a gradual recovery from 2016 onwards . We have an unfavorable base of comparison in H1, and the municipal elections are traditionally a headwind for construction.
A material or quicker recovery will constitute an upside, and we expect a positive price environment. You were talking about other markets. I believe that many of the emerging markets should remain well-oriented. Mid-term, as you said, Senegal will benefit from the ramp-up of Kiln 6 during full year, and India is expected to remain volatile in a growing market. So at this time of the year, we stay cautious, but we'll have other opportunities within this year to be more precise with what happened actually.
Second question: How do you interpret the recent political comments in France and Germany around potentially lower CO2 prices and the ETS adjustment? What would lower CO2 price mean for your carbon capture strategy and long-term cash generation in France and Switzerland?
Well, there was rumors. In fact, nothing is changing on the short-term basis, and nothing is changing on the long-term basis. Things could change on a midterm basis as it changed in the past. And basically, it could be positive for industry to decrease the rate of, to lower the rate of free quotas decrease. So it will mean we'll have a little bit more means to fine-tune our strategy. As you know, the cement industry has four levers to reduce its carbon footprint. Modernization of equipment, we do that. Defossilization, it means we replace coal by waste, and then lowering clinker factor. And these three levers brings money.
It's all together, it's large of each, a decent part of Vicat EBITDA. Then, the last lever is CCS or CCU. For Vicat, main project, as I said, is about Montalieu-Vercieu, and the decision will be taken at the end of 2027. So we have time to fine-tune things. What's happening now about the quotas is, I would say, a regular adjustment of the European policy. And I feel it's positive for our industry if it's like what we think it will be.
The next question comes from Tom Zhang from Barclays. Please unmute your microphone.
Yeah. Hi, thanks for taking the follow-up. The first one was just a follow-up, actually, to that point on EU ETS. I hear what you're saying, that, you know, perhaps not much is changing, and this is, as you say, a regular adjustment of policy, but ultimately, the CO2 price has declined by 25% in the last month. How has that change in EUA prices affected your VAIA CCS decision-making? And then the second question was just, could you speak a little bit about what you've seen in January and February so far, the run rate, that we've had in Q1, how does that match against your pricing and volume assumptions, especially in France? Thank you.
Yes, Tom, thank you for your question. You know, for the VAIA project, first of all, it's probably first reminder on CO2 reduction objective for 2030 are based only on the three first layers that Mr. Sidos presented, the traditional levels that have their own paybacks. We have said for a long time that CCS will contribute in a second step, in a longer run, notably because of a weaker economic model. Indeed, if carbon price comes down, that will probably lead to a review of the space of those projects. But we still are fully committed that both technology will be needed to reach the 2050 ambition. It's not just a matter of time, which may create opportunities in terms of technologies as well.
That's the first point. Second point regarding current trends, that's very early in the year to give you comments on where we stand on pricing. I mean, we have announced them. We are, of course, getting them through, but January is never a month you can extrapolate to the full year, so I will stay away from any comment.
Fair enough. Thank you. Thanks for, thanks for the answers.
Thank you. There are no more questions at this time, so I hand the conference back to the speakers for the closing comments.
Hello, ladies and gentlemen. Thank you for joining us today. We look forward to seeing you at our annual general meeting on the 10th of April in Villeurbanne, the beautiful department of Isère. Thank you very much.
Thank you.
Have a nice day. Bye-bye.