Earnings Call: Q4 2015

Feb 11, 2016

Good afternoon, gentlemen. Welcome to our Annual Results Conference for fiscal year 2015. With me today are Hugo Rohroff, our CEO and Rainer Broujean, our CFO. I'd like to let you know that this conference is being webcast live and will be archived on our website. Our agenda for today starts with the presentations by Uwe Berghof and Rainer Bouchon. As we did in the past, we are presenting a set of slides to accompany our remarks on this conference. The presentation, the press release and the annual report can be accessed via our website at garesamer.com/investorrelations. After that, we will enter into a Q and A session, where we, as a start, will invite our guests on-site to ask questions. Subsequently, all participants joining us on the call will have the possibility to ask questions. Before we start, I would like to remind you that the presentations and discussions are conducted subject to the disclaimer. We will not read the disclaimer, but propose we take it as read into the records for the purpose of this conference call. With that, I hand over to Uwe. Thanks, Ark. Good afternoon, everyone, and thanks for joining us for our conference here in Dusseldorf. Welcome also to those of you joining us on the call. As I start, I would like to share with you some market dynamics that are quite supportive to our growth strategy. Let me start with the worldwide population increase. According to market forecast from IMS Health, in 2020, which is not too far ahead, 50% of the world's population will consume more than one dose of medicine per day. This number is substantially increased when we look back. Within 15 years, it grew from 1 third of the world population to now half of the world's population. And don't forget, at the same time, the population has grown by 1,200,000,000 people from 6,130,000,000 to 7,320,000,000 during those 15 years. The increase is predominantly driven by the high consumption in the countries China, India, Brazil and Indonesia. Better Medical Care in highly populated emerging markets means volume growth for our company. The availability of drugs at affordable prices boost drug sales, thus generating greater demand for packaging. This is important for us since the number of packaging units being sold is most relevant to our business. This too is exactly the rationale behind our expansion into the emerging markets. We have several plants in China and Brazil and also 3 in India. We will start production in our new greenfield plant in Cozamba in 2016. But it is not all about emerging or as we say, farm emerging markets. The U. S. Is and continues to be the biggest market in spending on medicines. According to IMS, just 5 years ahead until 2020, spending on medicines will increase by about 1 third. This will be driven by innovation, invoice price increases and the loss of exclusivity. Generic medicine will continue to provide the vast majority of prescription medicine usage in the United States, rising from 88% today to 92% of all dispensed prescriptions by 2020. We are in the U. S, one of the most important manufacturers for liquid and solid dose packaging made out of glass and plastics. Widely used for generic medicines by the way. Therefore, we heavily invested into new production capacity in our glass and plastic plants in the U. S. And on top of this, with Centaur, we successfully acquired the market leader for oral prescription packaging. On top of this, we also invested in inhaler capacity for an innovative product in our PEACHTREE facility. This substantially increases our exposure to the U. S. Pharma market to more than 30% of our group revenues in 2016. With our offerings, we serve millions of patients that suffer from chronic diseases. According to the International Diabetes Federation, 415,000,000 people suffer from diabetes today. This is one out of 11 adults By 2,040, so in about 25 years from now, this is supposed to rise to 642,000,000 euros or 1 out of 10 barrels. This is why we invest into our production facilities in plastics and devices in the U. S. But also in Europe. Our market leading product portfolio includes insulin pens, vials, cartridges, infusion sets and bricking devices. I would like to share with you some of the numbers. We are a volume producer. Now that we have center on board, we produce 15,500,000,000 products on an annual basis. This gives you almost 500 products per second. A very comprehensive product portfolio that does not depend on a single form of treatment, but covers a wide portfolio for oral and liquid drug packaging and delivery. The sale of our Tubing Glass business to Corning has no negative effect on our product offering since glass tubes are an intermediate product and as such the raw material of tubular glass products such as vials, cartridges and ampoules. In fact, our newly founded joint venture with Groningen to bring innovative glass packaging products to the market will contribute in the future new products to our portfolio. So volume matters. And remember, each product counts since each product is going to serve a patient in a difficult or even a dangerous state of health. I'm proud that we can do that. So by now let's move on to the 2015 numbers. 2015 was obviously an exciting year for us. We are reporting 2015 results fully in line with our targets. We invested in our business, expanded our capacity in the United States, in the Czech Republic and in India to drive our international expansion. Furthermore, we achieved solid progress in restructuring and simplifying our business. We expanded our plant in Peachtree, United States. We allowed for further additions to production capacity at our location in Ozovsky, in the Czech Republic, and we completed the extension and quality improvement at our Mold Glass plant in Chicago and completed construction of a new production building for manufacturing of wires and ampoules in India. We made a value enhancing disposal such as the sale of our former glass tubing business to Corning And with Centur, the U. S. Market leader for plastic packaging for oral prescription medication, we conducted our biggest M and A deal in our company's history. We successfully completed our refinancing in June and issued a Schulchan in November to replace a bridge loan that we had in place in order to finance the Center acquisition. That said, 2015 was a very successful year for us. And together with the supervisory board, we propose a dividend of €0.85 per share to our shareholders. So we have a very solid base that we can build upon as we move ahead. The purchase of Center increases not only our product diversification but our regional diversification. In 2015, revenues in the Americas stood at 23%. We estimate that the U. S. Revenue share to increase even further to about onethree of total revenues in the fiscal year 2016. By then, Centro will be contributing on a full year basis. The acquisition of Cento enabled us to achieve a long standing goal to strengthen our position in the U. S. Market for plastic pharmaceutical packaging. We have been number 1 in North America for many years now with our glass vials and ampoules for packaging liquid medication administered by injection. With Centaur, we are now America's number 1 when it comes to plastic packaging for oral prescription medication. So please move on with me to slide 8 and take a look at our key metrics. As I said earlier, numbers are fully in line with our targets. On a reported basis, revenues rose by 6.8 percent to €1,377,200,000 Organic FX neutral growth stood at 1.5%. Especially our high value products such as injection and inhalation devices as well as diabetes care products significantly supported our growth in 2015, offset by the expected lower tooling revenues after our record year in 2014 and lower U. S. Revenues for Pharmaglass Containers due to the shutdown of our millage plant. Adjusted EBITDA consequently grew 9.7% to €277,900,000 supported by the inclusion of Centro for the first time in Q4 as well as several operational improvements along all divisions. This gives us an adjusted EBITDA margin of 20.2%, right where we wanted to be. Adjusted EPS earnings growth was even stronger, almost twice as high with adjusted EPS being up 18% to €3.41 Based on our successful year, we will propose a dividend of €0.85 per share for the financial year 2015. This represents a dividend payout ratio of 24.9% of adjusted net income after non controlling interest and an increase of 13.3% against last year's dividend. Let me now review our guidance in detail. We fully delivered on our targets for the fiscal year 20 15. Excluding exchange rate effects, we recorded organic revenue growth of 1.5%, which corresponds to our guidance of 1% to 3 percent organic growth. In terms of adjusted EBITDA, we were heading for a corridor of €255,000,000 to €265,000,000 at constant currencies and finally recorded on a comparable basis 262 point €5,000,000 excluding exchange rate effects. And don't forget that in this number, Tubing is only included with 11 months contribution. So we basically hit the upper end of the corridor. CapEx stood at 9%, also fully in line with our expectations. With huge investment in furnaces such as Chicago Heights and as well as machine standardization projects. So 2015 was quite a successful year. Rainer will now walk you through the finances in more detail. Thank you, Uwe. Ladies and gentlemen, welcome also from my side. Let's have a look at the revenue development for the year on Slide 11. On group level, revenues were up by 6.8 percent and amounted to €1,377,200,000 Our organic growth rate year over year was 1.5%. So throughout the whole year, we had a strong and positive currency translation effect, which can mainly be attributed to the strong U. S. Dollar. In the Plastics and Devices division, organic growth was 2.8% and reported revenues increased by 7.8%. This is a decent growth rate, which was driven by plastics, primary packaging in Europe as well as our medical plastic systems where inhalers, insulin pens and diabetes care products posted good growth rates. And also Centa made an initial contribution in the Q4 of €31,200,000 Don't forget the counter effect out of the lower tooling revenues as well as the slower start of the inhaler product, which were already included in our original guidance for 2015. In the Primary Packaging Glass division, we had a slow start to the year with negative organic growth in the Q1 of 2015 coming from weaker customer demand in the U. S. But over the course of the business, business returned back to the growth path, so we recorded 0.6% organic and 4.6% reported growth in that division. Other than that, we closed our Millville plant in Q3 as part of our efforts to optimize our portfolio and are now focusing all our U. S. MultiPlus efforts on our Chicago plant. So considering the circumstances, we had a good year also in plastic in primary packaging glass. And finally, in Life Science Research, demand continued to be muted as is reflected in the minus 0.8 percent organic growth rate for the year. However, the strengthening of the U. S. Dollar caused a strong 15.3% rise in reported revenues in full year 2015. So from that, we benefited a lot. To sum it up, organic growth picked up in the second half of 2015. And in addition, the strengthening of key currency, whether the euro, most of all the U. S. Dollar, pushed the reported growth rate markedly up. And so overall, the development in 2015 were fully as expected and fully in line with our guidance and then also included a positive effect from Centa in Q4. So let's move on to the adjusted EBITDA slide and that's Slide 12. Here, the development in full year 2015 was also positive, driven by good margin development in all three divisions. For the first time, the adjusted EBITDA margin in the year was above 20%. Actually, it amounts to 20.2% and was therefore markedly above the level in the prior year, but had been 19.6%. Group's adjusted EBITDA came in at €277,900,000 in full year 2015 compared with €253,400,000 last year. In the second line on the slide, you can see that the margin in Plastics and Devices went up from 21.1% last year to now 21.9% in 2015. The cost of business overall performed very well. Centa made an €11,000,000 contribution in the 4th quarter. And therefore, please make sure that when you forecast the 2016 revenues and adjusted EBITDA for Gerasimer, please remember that we had already 1 quarter included now in Q4 2015. So when you forecast 2016, there will only be 3 additional quarters of initial contribution from Santo. Primary Packaging Glass, the margin also rose to 22.1% and was higher than the margin level in 2014, which had been 21.5%. So we had a great year here on the margin side, and that was driven by the strong business development in molded glass in Europe, intertuberant glass converting in the U. S. And it still had €22,000,000 in contribution included from the glass tubing business that we effectively sold on November 2, 2015, after 11 months in the full year 2015. So again, when you think about full year 2016, please make sure that you exclude these €22,000,000 in adjusted EBITDA because we sold the business. And also, please make sure to exclude approximately €34,000,000 in 2015 sales due to this reason, too. And finally, in Life Science Research, our improved productivity led to a higher margin year over year. Effectively, we achieved a new record high margin of 15.2% in 2015, which compares to a margin of 14.2% in 2014. So that is a strong 100 basis points upward margin movement, especially considering the last year's margin was already quite good for the business, which is very asset light overall. To sum it up, we managed to show good margin performance in 2015. In 2016, we will lose the clearly positive adjusted EBITDA contribution from the glass tubing business, but please remember that we will have a positive impact from the inclusion of Center. Now please move on with me to Slide 13. Here you can see that this was a very successful full year financially despite a handful of one offs that we recorded. And the key points are adjusted EBITDA was up by 9.7% and amounted to €277,900,000 also boosted by Centa. So it was only included since the start of Q4. Depreciation was roughly flat because we had new tubing depreciation since July, but still recorded revenues in that business for most of Q4. Therefore, adjusted EBITA was even up a bit stronger than adjusted EBITDA and amounted to €191,600,000 plus of 15.5%. Then you see the one off that we recorded. The key message is that despite the center purchase and the charges for portfolio optimization, which amounted to €15,900,000 these items were overcompensated by the positive one off income from our disposal of the glass tubing business of €52,200,000 Don't forget, if you forecast 2016, portfolio optimization stands for approximately €60,000,000 of sales with a lower margin, which you have to take out for comparable year 2015. Nothing new at all, depends mostly on Millville. We have to take our products, as you know, to make sure that we can stay as focused as we are. And by the way, you can see a complete overview and discussion of all the one time effects in our annual report on Page 3839. So that means we actually had a positive effect of €24,300,000 when it comes to one off effects in 2015, while last year in 2014, one off effects had been negative. Amortization of fair value adjustments were up year over year coming from the effect of the purchase price allocation from Centa. The overview on the changes of intangible assets can be found in the annual report on Page 99. To summarize, the 2015 fair value amortization for Center means 1 quarter is approximately €7,000,000 The full year effect, 2016, will be approximately €28,000,000 Overall, our EBIT grew by 49% in 2015 and amounted to €193,600,000 clearly the highest annual EBIT that we ever recorded. Going further down, net finance expense was slightly higher than last year. Our debt went up markedly towards the end of the full year. And we have included 1 off positions here in this figure, which are €3,500,000 to hedge foreign exchange rate movements related to payment of the purchase price for the Sanketa acquisition and also €3,000,000 in write offs in relation to refinancing, mostly debt insurance costs in June 2015. Overall, a very good result. Earnings before taxes amounted to €159,000,000 plus of approximately 60% year over year. Then finally, taxes. And even though they are higher than in the last year, this is just a consequence of the higher income figure pretaxes and a partly reversion towards the normal 30% income tax rate, while the tax rate has been extraordinary low in the previous year. So net income was up by 54.6 percent to €112,700,000 overall, a very strong development. So let me now reconcile the net income to adjusted net income with the focus on adjusted net income after non controlling interest because this is the basis for our dividend payment where we have these numbers here on Slide 14. The reconciliation can be described pretty quickly. I already explained the one off effects and touched upon the fair value effects, which are higher because we have made the purchase price allocation to Centa. Included in the net finance expenses is the one off effect of 6,500,000 euros 4,500,000 attributable to the hedging of the payment of the purchase price for Center as well as the refinancing of the bridge loan and the revolving credit facility, all of our effects together to have a negative tax effect of approximately €1,300,000 The one off tax related effects of €1,800,000 relate to the tax payment after recent corporate tax audit. Now we have finished all tax audits for the German tax group, including the year 2012. This gives us a good security on tax going on forward. So the adjusted net income was up by almost €20,000,000 and amounted to €17,700,000 Obviously, then we have an amount of €10,700,000 attributable to non controlling interest. Overall, there's a strong increase in adjusted earnings per share from €2.89 to €3.41 per share. As you know, our dividend policy is to distribute 20% to 30% of the adjusted net income after non controlling interest. Therefore, we want to pay $0.85 per share, which is 25% like in the prior years. And it is a 10% increase compared to last year's payment of actually the 5th consecutive increase in our annual dividend. Let's have a look at our new financing structure that we now have in place after our refinancing of our bank loan on Slide 15, we implemented in June 2015 as well as Schulstein debt placement that we concluded in November 2015. This was all necessary to refinance our new company center. The purchase price of €652,000,000 was fully financed at the 30th November by the Schulzheim of €425,000,000 plus the higher drawn revolving credit facility as well as the tubing sale of approximately €196,000,000 A huge success if you remember that we acquired Center at the 1st September 2015. Let's just have a look, a quick look at the components of our new structure at the end of full year 2015 on the right hand side of this chart. This first position on top in light blue is the new chilshyan emission that we concluded in November. The total amount here was 425,000,000 euros It consists of tranches of 5, 7 10 years to maturity and the interest rates are between 0.75 variable interest rate for 5 years and 2.04 6 coupon for 10 years on that debt. And you can see you can read all details in our annual reports on the pages 113 to 150. Secondly, in the darker blue, you see our corporate bond in the amount of €300,000,000 which matures in May 2018. And finally, the 3rd big position in green represents the €232,800,000 in our new revolving credit facility that we put in place in June 2015. This facility carries also very good interest rate of roughly 1% of the reporting date it matures in 2020. With this, we have a strong financial structure in place, which has very attractive interest rates and still give us lot of headroom to execute our strategy for profitable growth. And with this, we have also fully financed the center deal over the mid- to long term. That is the reason why our leverage has gone up year over year from 1.7x to now 2.9x net debt to adjusted EBITDA at the full year end 2015. This number is better than originally indicated with approximately 3x, but we further intend to bring that down from the 2.9x as the cash that our business generates, especially also now boosted by the strong cash generation of Centa. To remind you, our ideal structure should be 2.5x, and we intend to reset in approximately 24 months. Let's then have a closer look at the key balance sheet and cash flow figures on Slide 16. Overall, the good set of results that we achieved in full year 2015 is reflected also here, meaning our balance sheet remains healthy and cash flow development very favorably. Total assets were up markedly by 46.1% compared to the last year, mainly coming from the initial consolidation of the assets and liabilities of Center and was slightly dampened by the sale of the glass tubing business. You will find you also all details in the annual report on Page 84 under number 2. Group equity was up by 15.5% to €698,100,000 Most of the increase is attributable to the continued positive development of group net income, But the equity ratio was lower than last year. It amounted to 28.8% compared to 36.5% at the year end 2014. The reason is that the purchase price percent of our debt finance as explained before. Net working capital was about €20,000,000 lower compared to the previous year's end. It amounted to €213,700,000 at the reporting date, which is 15.5 percent of the last 12 months revenues. But this is not really a run rate. You should really go with the average net working capital figure in relation to last 12 months revenues, which amounted to 19% and was therefore unchanged year over year. Net working capital at the reporting date was influenced by 2 one off effects, of which one is related to the sale of the glass tubing business because here, we have still included revenues up to the date of the sale of November 2, 2015, while we did not include the assets and liabilities of that business at the full year end according to IFRS. The other effect was related to the Chicago plant overhaul, which was implemented rather at the end of the year. So inventories here were also lower than usual. Due to the Tubing sale and the acquisition of Centa, we believe that we can reduce the average net working capital to a good 17% starting in 2016. So that means if you compare 2015, we we think that we can reduce this 2% in 2016 on average. We will give you the overall guidance a little bit later. Looking at the key cash flow figures for 2015, what I can say is that they are markedly up. This is due to the good business performance, the one off gain from the glass tubing sale, the initial cash contribution of Centa in Q4 and the improvement in net working capital to very low 15.5 percent at the year end of 2015. Please keep in mind that we will have to pay onetime taxes in relation to the profit of the Tubing sale of about €35,000,000 in the U. S. So therefore, the full effect of the improved cash flow profile due to the sale of Tubing and the acquisition of Centra will be seen starting with the year 2017. We expect an operating cash flow margin of approximately 13% in the year 2018. Our former number by the year 2018 was above 10%, so an outstanding improvement. Finally, looking at the CapEx figures, nothing surprising, all in line with our expectation. So overall, the good performance in full year 2015 is for sure also reflected favorably in the balance sheet and cash proceeds. Finally, let me sum up the key financial takeaways from full year 2015, which you can see on Slide 17. First, let me reiterate that our financial profile clearly improved as a result of the Center acquisition. It is a game changer because we have a broader footprint in the U. S. And center markedly strengthened our margins and cash generation. Secondly, the disposal of the glass tubing business leads to lower CapEx requirements because we do need to maintain 6 furnaces that we do not need to maintain 6 furnaces that we sold as part of the glass tubing sale anymore. Uwe will give you some more color on that in a minute. So in total, we now have 8 furnaces left compared at the beginning of the last year because we sold 6 as part of the glass tubing sale and we closed another 2 as part of the plant shutdown in Millville. That means we have 13 furnaces remaining. That means as a company, we have not only a better CapEx profile, but also markedly improved risk profile resulting from that. The 4th point is that our net working capital requirements should be lower next year excluding the glass tubing business essentially because we will buy the tubes that we need for our converting business from Corning and other companies. So we do not need to hold the inventories associated with the Tubing business anymore. Together with all other installed improvements, this should make possible reduction overall net working capital requirements for the group of about 2 percentage points, so that an average annual net working capital of about 19% 2015 to about 17% in 2016 of revenues. And I just outlined that as well. We have a strong financial structure in place, which has very attractive interest rates and still gives us headroom to execute our strategy for profitable growth. So with that, I hand it back over to Ulf. Thanks, Reiner. As you said, our target is to grow the company profitably, and we started several initiatives to get ready for further revenue growth and strengthening of our profitability. So number 1, we made a lot of progress in Peachtree City. Our facility is now ready for the start of the production of an asthma inhaler in 2016. 2nd, on top of that, we will have a contribution of additional 9 months of center helping us to grow in 2016. And third, we expect our Primary Packaging Glass business to grow organically with low single digits, which has been the normal rate in the past. For 2016, we guide for approximately €1,500,000,000 revenues at constant currencies, which gives us a 9% FX neutral revenue growth. Underlying organic growth will be about 4% to 5%, so exactly as we have indicated last year. Given that the dollar got a lot stronger compared to last year, we base our assumption for the dollar on an exchange rate of U. S. Dollar 1.12 to 1 euro Adjusted EBITDA is expected to come in at approximately €320,000,000 at constant currencies. Compared to prior year, there will be €22,000,000 for 11 months less EBITDA contribution from our Tubing business. Therefore, you have to adjust the primary packaging glass margin down by approximately 2 percentage points. The remaining primary packaging glass business is expected to achieve a margin increase in 2016 of up to 50 basis points. Centaur, as part of Plastics and Device division, will generate a full year of EBITDA contribution compared to the Q4 2015 contribution of approximately €11,000,000 CapEx requirements will be at about 8% of FX neutral revenues, which is substantially below historic CapEx levels. And let me tell you that this is not a temporary effect. The lower CapEx rate reflects the structurally lower CapEx intensity of our business driven by the disposable of our tubing business, the shutdown of our mill fill plant and the purchase of the center business, which has significantly reduced CapEx requirements compared to the remaining business. Also, average net working capital, as Reinhard said, will improve from the 19% LTM in 2015 to approximately 17% in the coming years. We are also reiterating our indication for the years 2016 to 2018 with a CAGR of 4% to 5% organic revenue growth. For the adjusted EBITDA margin, we still target approximately 22% by 2018. And the CapEx requirements, as in 2016, will stay about 8% of currency neutral revenues, which is a bit lower than we have guided so far. So let me finish in saying we are very well prepared for the future. Our business is supported by stable diversified growth prospects based on long term megatrends. We did a forward looking and trend setting asset swap for Centaur's old tubing, and our goal is to reduce debt again to secure our current investment rate rating. We are fully committed to move consequently forward on our path to becoming the leading partner of the pharma and health care industry. And again, we have a high confidence in the setup of our company, and I'm personally excited about the future. With that, I would like to hand it back to take questions from everybody here in Dusseldorf. May I ask you to use the microphone so that everybody can understand you also in our call? Thank you. And we will. Okay. Next question comes from Chris Gretlert. Thank you. It's Chris Gretlaff, Credit Suisse. I have a question with respect to Centaur. Could you elaborate on the performance in Q4 versus now the past 12 months? So if I look at your annual report, Page 85, you basically had a contribution of €11,000,000 in EBITDA. But if it was consolidated for the last 12 months or since the beginning of fiscal 'fifteen, EBITDA would have contributed about €63,000,000 Could you elaborate on what in Iceland, the difference here in terms of full year performance versus Q4. And again, if I understood you correctly, you expect about €28,000,000 in incremental contribution for fiscal '16, whether I got that correct. And the second question with respect to your restructuring, are there any cost and assets planned for fiscal 'sixteen actually? Hunter, you should assume for the year 20 16 that the same nearly the same amount for Center for the full year also is our expectation going on further. As we said during the acquisition, we are we want to keep the good profitability and the margins, which we have there on that level. And that's clearly our target for the last quarter. That's exactly what we have expected. The €11,000,000 euros that's totally in line because have in mind, the year end for us ends at the 30th November and flu season and all the other starts normally a bit later, first effect. And second, in the €11,000,000 you have a onetime effect due to the purchase price allocation of approximately $2,300,000 which is another $2,000,000 So but now we are in the jungle of $1,000,000 up and down. So we are pretty happy with the performance of Centa. It's exactly in line with that we have expected. If you see our quotes in Q3 or when we announced that we are doing it, we said €30,000,000 and approximately €12,000,000 And with the €13,000,000 which we reached at the end, when you take the special effect out due to the write off of inventories due to the purchase price allocation. And the €31,000,000 for the last quarter, we are totally where we want it to be. And we also can say, right now, it also works very good or acceptable goods as we expected it in our guidance for the year 2016. So we're happy with this acquisition. So second question, I haven't got to be honest. Yes. The €28,000,000 which you asked before, I don't know what was the €28,000,000 Perhaps you can repeat that in your second question which you had. No, maybe I just misunderstood. I thought you would you said that there was an incremental CHF 28,000,000 in EBITDA contribution for Centro for this, but that's No, you have to assume what I would forecast is I would take out the €11,000,000 and then I would take in the full year effect, which you could see in the annual report. I think that's the best guess which we can have right now for 20 16 as the full year amount for Centaur and their contribution to the EBITDA. So portfolio optimization, as you know, we always streamline our profitability going on further. So for us, that's an exercise we do during the year. So we don't forecast that, but we would like to keep our margins on a high level like we did in 2015, where we have taken out some stuff here, €16,000,000 in revenues approximately, I would say, profitability was €2,000,000 to €3,000,000 That's the reason which we had in 2015. We are not forecasting right now what is going on in 2016 because that all depends on the performance. Thanks for taking my questions. 3, if I may. And one is relating to the emerging markets. Can you potentially comment on how business developing in Brazil, India and China? And second question, a follow-up question on Centaur, please. How do you expect the top line development going to other general market trends for Centaur? That would be helpful. And last question, when I see your Life Science Research performance in the Q4, the margin development, maybe the market is getting a little easier for the business as well. Is this increasing the likelihood of potential third party coming around the corner, knocking on your door and saying we are interested in this business? I'll start with the emerging markets. As we stated and as you know, the IMS forecasts and our own business estimate, we believe that the contribution, particularly on volume growth in the emerging markets, will continue to be solid for the coming year. Nevertheless, we have a couple of different economic situations in different of those markets today. And we know that particularly in Brazil, economic development has been rather soft. Even though that we are basically in the prescription medicine market, you see some of those issues in our business, and we have already included that in our forecast. I see India continuing to be quite strong. Going forward, I also expect that even though that the growth is rather limited by the infrastructure in India, the overall development in the pharmaceutical markets are continuing to grow strong. And in Brazil and in China, we have a number of regulatory changes that move regulatory hurdles more or less closer to the Western world, which makes it more difficult to approve new packaging for drugs and new drugs with registration. I think that overall is a very, very solid trend on increasing the entry barriers in that business. But I do think that the excellent growth rates we have seen in the past in China maybe for 2016 are somewhat dampened as well, and we have taken that into account in our forecast as well. On Centaur, I think that the top line expectations, we said this is a top line business that growth low single digits is included in our forecast. What can happen to the top line are basically only 2 things, which is depending on oil price and resin development. You know that we have increases or decreases in prices to the customers that are generally margin neutral, but that could potentially affect a little bit the growth number for the year. But that is really the only effect other than that. This is a super robust business due to that it is all prescription packaging. So estimation, what is as we have indicated during the acquisition, those assumptions are included in our guidance. Life Science, yes, Rhino achieved a magical 15%. So we always said, this is a nice margin, which could trigger a potential sale. So since we generally do what we promise, we it would certainly not be a surprise if a good offer comes to our table. And our partner, Thermo Fisher, don't forget, it's a joint venture. We have to act in concert. He agrees to it as well. He knows that this will trigger a portfolio change going forward. It should not be considered if it happens as a surprise. If it doesn't happen, it always takes the necessary offer for a good transaction as well. So from that standpoint, it's pure speculation at this point. Yes. But also to say that it's not very good that we read the 15%. It had to do with several minor actions, for instance, shift, part of system change, some mix portfolio optimization, some efficiency gains in the 2 major manufacturing and so on. So we've done a lot. We also will do during this year a lot. We're ready to invest further on. But as we said, in that moment, somebody comes along, that's what we always said several years. But we always said in 2012, I remember that also written down on our annual report that 15% is the magical number, which we have to reach. And this year, we have reached the 15%. That's true. Good job, Reiner. Thanks, Uwe. Jan Kepler, Yes. Hello, Jan Kepler, HSBC. Thanks for taking my questions. I also have a follow-up on the Centaur acquisition, especially on the top line development here. If I take the annualized sales number from your annual report, which was 100 and 43, convert that back to U. S. Dollar, the number is somewhat lower than the initial number you have given for 2014. Is this really an underlying sales decline or any specific differences here in the maybe in the accounting standards? That's the first question. And the second question would then be on your EBITDA guidance for 2016. I was wondering if you could share with us a bit what are the crucial triggers actually which could decide if you end up with the upper or lower end. I think I'm particularly asking this question in regard to the lower end because I think this scenario, if we take into account the Centro acquisition and the disposal of the Tubing business, does not guide for any organic EBITDA growth in 2016. When you look on Centra, this is the pro form a number which has to be put in. Don't forget these numbers are not our numbers in that case. So we have to take it how they are from the audit reports before. There was also included several changes during the year. So the number which we have here and the €143,000,000 is in the notes of the annual report is a number which is okay. And we don't have a better number going on further. So that's the number for the revenues and it couldn't go up as Uwe has said based on raw material up and down, but the margin is totally robust. The attrition rate, when you see that we have put in €450,000,000 on customer value, it shows you that the attrition is very, very high and you can see how robust the business is. So we are not afraid going on further that we can keep the good cash flow and the high profitability on that level. The only thing you have to keep in mind what can influence the revenue base, which is on the volume basis extremely robust, is the development of oil price that eventually might have an effect on resin prices because we have pass through clauses with customers. So with a very low oil price, you can always expect that the resin prices might be down and then some adjustments have to be made to the sales prices. And you can imagine that, that easily can have an influence of 1% or 2% or 3% on total revenues, while it will not have an effect on the margins because this is generally margin neutral in the worst case, I would say. So that's really the only one. Other than that, that is a super stable business, same customers, same products. You have one product here in your hand. And so from that perspective, I think that has added a substantially increased robustness to our overall business model. And we are convinced that this will show in 2016. Perhaps you give me a chance, now I have to give you some numbers and maybe a little bit more complicated, but at the end, you will see it comes to an end. So when you see our revenues this year of 1.377 and say this is roughly 112 And we have included in that €31,000,000 of tubing, and we have which you have to take out. And you have to take out roughly €31,000,000 in center €34,000,000 of tubing, which you have to take out and another €60,000,000 of portfolio optimization, then you come to €1,296,000,000 of revenues, then you add for the next year, on top the €143,000,000 for Centa for full year effect. And you come to EUR 1.440 roughly as the comparable revenue number for the year 2015, you see that the organic growth compared to the €1,500,000,000 is fine because then you calculate roughly 4.2%. If you do the same exercise now for the profitability, you will come up means you start from the €278,000,000 you take out the €11,000,000 effect for center. You take out the €22,000,000 effect for the Tubing business and you take out for the portfolio optimization roughly €2,000,000 And then you add back of €63,000,000 roughly, then you come to a number of roughly €305,000,000 By the way, that's pretty exactly the number, which you also need for the pro form a calculation for the net debt calculation because the 2.9 only calculates with the 305. Euros The 305,000,000 comparison to the €320,000,000 means you have €15,000,000 on top profitability EBITDA compared to €60,000,000 on top organic growth. And that means you have an incremental margin out of this extra profitability compared to the revenues of 23%, 24%. And when you then see at the same time that we are ramping up manufacturing, like for instance in India, like for instance in Peachtree and so on, you see that the incremental margin is even higher. So that means the $320,000,000 doesn't look bad. But again, we don't know it exactly. That's the reason why we have said plusminus10 is in the ballpark. So therefore, we feel comfortable with the numbers and we think it's a good number going on further. We are at the beginning of the year. And as usually, we give you more color as we move forward. And I think on €300,000,000 variation of €10,000,000 on the number, I think it's quite a reasonable bandwidth. Next question from Sven Kurten, please. First one is again on the guidance. I think you're guiding for 4% to 5% organic growth in 2016. And the question is which product groups do contribute most that? I think you mentioned already asthma inhalers as one factor. So I would like to know the other factor for that. And then again on the Centaur, question is if you could elaborate a bit on the seasonality of Centaur. I think you mentioned already the flu season. I don't know how would you see that going in the course of the year, the seasonality of revenue and EBITDA then? Yes. I'll start with Do not forget that this is a business that goes that has 2 components: the direct sales of the pharmacies, which are the Walgreens and the Rite Aid of this world and the sale to distributors. So basically, those have different buying patterns. Of course, distributors generally load up their warehouses before they actually sell to the end customers, while direct customer basically order quantities directly for the pharmacies. On the seasonality, that depends a bit on when pharma companies start to fill up the pipe when pharmacies start to fill up the pipelines. And I can only recommend I think I had a very I saw a very similar question to Stata revenues a few months ago where the question was actually when is the flu season is going to start and one of the main selling products is and this was a month off, I think, compared to the year before. Interestingly, in this business, we see about the same pattern. I would not recommend looking at Centor to look too much at a single month because the variation for month to month can be quite significant. But if you take a look over a longer period of time, it's extremely stable. So you can have a super high December, for example. And then the next month, because pipelines are full, will be significantly lower than the next month could be significantly higher. So it's different than in the direct pharma business where you continuously fill a pipeline because you basically have the distributor here as a stocking business in between. So my recommendation is, I think over the quarters, you do not see too much of it. But generally, taking a look at the numbers, you can already figure out that our Q4 is not a very high quarter, which is different than the rest of our business, by the way. Okay. I have any further questions here, Andrew. The same question was on the guidance, the 4% to 5% growth, which product could look at most of it? I think you mentioned already asthma and halos, but the other products, please. If you take a look, and that is very in line with the trends. Number 1 is we think that we have on Primary Packaging Glass a more normal year in 2016 compared to a lower year that we had in 2015. So you will see a normal contribution. And then on the products, we expect, as we said, I already elaborated on Centaur, and we know that Life Science will have difficulties on the top line. So those are the performance in the low single digit growth or no growth areas if it comes to cash to FX neutral growth rates. So then you are back to the devices. And in the devices, you are back to the high value products. You are basically back to inhalers. And we actually think that in the insulin sector, we will continue to do well, which means the whole product range, not a single product. You cannot reduce this to an insulin pen, but also more products that go with pumps, infusion sets, pricking devices, we think that continue to do well in 2016 as well and are at the higher range of our guidance. So if you take a look at the absolute lower end, you have Life Science. I think then the Primary Packaging business comes right in the spot where it has been coming in over the last years on average. And then on the upper part, you have the higher value products devices, very much in line if you look at the long term trend at Galafimor. So I view 2016 as a very, very normal year, robust business. A follow-up question from Daniel Windos. Thanks for taking the question. It would be on your RTF syringes within primary sorry, within plastics and devices. The 4th line, is this now fully operational? Is it filled? And how is the competitive situation versus Dickinson in the field? So any more color you can give us here would be much appreciated, yes? Yes. We made good progress in 2015, and we know that we still have when you take the competitive position to Becton Dickinson, we still have a few more gaps to close. That has also to do with the product portfolio. As you know, we do not have safety devices. We do not have currently a marketable COP syringe out of 1 production. So we are working on all those type of development programs going forward. As we have already indicated during the last Capital Markets Day, this is going on with full force operationally. Boendale has made good progress last year. Quality indicators have been substantially improved. The 4th line is fully operational. We are very happy with the technology and we would actually if there is going to be a 5th line, we are quite sure that it's going to be the same technology. So we are very happy with this. I would say this is going on quite well. But nevertheless, the largest competitive gaps, if you might say, to Becton Dickinson are still in the complete product offering, and we are working strategically to close those. But the market in general is still This is a good market. It continues to be a good market. And I really do not think that what you see here is you see more generic heparins coming, but they will be in syringes as well. You have vaccines growing. I think that market fully intact. And I believe that a glass syringe will continue to see the highest growth rates of all glass Primary Packaging. No question about it. This is a strategic product for us. So are there any further questions? And ladies and gentlemen, the lines are now open for any questions you may have. First question comes from David Edling from JPMorgan. 2, please. Just wanted just trying to get a handle on how important the inhaler launch is for your growth expectations this year. Maybe you could help us and how much of that 4 to 5 percentage points is attributable to that inhaler launch? And secondly, just with respect to guidance, so I'll take a picture question really. You're still guiding on revenue and EBITDA. But given the fact that depreciation and financing costs are at all moving towards guiding on adjusted EPS rather than EBITDA. Yes. Thanks for your question, David. I think the inhaler launch is honestly not that important for the overall guidance. In a ramp up situation, and you guys know that we have learned that not to listen too much on the promises of our customers on the last launch in the Czech Republic. We have been taking a little bit more cautious approach. It is for us a strategically important product. But the 26, I think the effect on the 2016 guidance would be very limited Since the launch quantities we have estimated in our guidance are not set super high. So from that perspective, we will see how that develop. But I'm not concerned that this will, in any way, affect our business with any significance. And just to follow-up on that. Can I ask you're expecting presumably not too much in the way of profit, whatever happened this year in that ramp up phrase? Well, in a ramp up situation, it is all about cost. Quite frankly, this is a heavily regulated business. You have to go through all kinds of hoops to get this approved, get this through the lines. So you're absolutely correct. From a profit business, the impact is even less. And then the guidance question? We were just about to answer the guidance question. Yes. Sorry. Sorry. Yes, on the EPS guidance, we obviously have chosen not to change that for at this time, I think that we have seen that it's right to explain that for 2016 compared to 2015 with the portfolio changes, this is already a more complex year to understand the transitions, I think, for everybody. So we have basically focused on providing guidance so that you compare previous guidance to new guidance on the transition. And going forward, we will always take advice and recommendations if we can improve our overall capital market contribution and include other aspects. But for this year, we have not foreseen to give an EPS guidance. Yes. But to add on that, I've given several numbers now. As you can see, we have provided you with the fair value amortization out of Centa, which is approximately for the full year €28,000,000 We have given you in our annual report a good discussion about the financial debt. So if you would calculate that in, would assume that the interest rates for pensions and all the others stays on the same level, you would figure out that the financial income could be similar to the 2014 number. Depreciation, we already said when we came to the Tubing business that the depreciation for the Tubing business is higher than a normal business. We said during the Center acquisition that CapEx is lower. So when you look on these numbers and would take that as a percentage, you can see in 2015 that we had roughly 6.3% depreciation. So when you then take out the tubing business going on further, that naturally goes down in depreciation, if you can assume 6.1% or something like that. So with all these numbers, tax rate, I explained before, we closed our tax audits in the German area up to the year 2012. The indication of the 30% tax rate or and that basis is a good one. So with all these numbers, you can easily come to the right numbers when you believe in our numbers and when you follow us on the numbers which we have provided you with, so because the fair value amortization also to add on, on that, for sure, your assumption would have been that it's going down from the €15,000,000 roughly, which we had without Centa in 2015. So because normally the assumption would have been that it's going down with $5,000,000 So and on that basis, you don't have all the numbers, I would say, even I could build a pretty easy model out of that. So perhaps, with this help, we should come to the point that you can be pretty close to that what we also have in mind. Great. We'll certainly try. Thanks very much. Okay. The next question comes from Veronika Dubajova. Good afternoon and thank you very much for taking my questions. The first one is a little bit longer term and it relates to your announcement that you would not be seeing on beyond 2018. I know that feels like quite a long time away from today, but I was just wondering if you can walk us through yours and Board's thinking on the whole transition process. My second question is just quickly on Chicago Heights. And if you have an update on now that you've been up and running, is there anything that has surprised or the downside on that? And my last question is just quickly to confirm, because from memory, when you announced Centaur, I think you were guiding to depreciation at around 7 16, but also in the medium term? And that's it for me. Thank you for your question. On my personal situation, obviously, if you are 25 years with the company as I am this year, 2 years more to go, quite frankly, sounds like a rather short term, to be honest. And I think I have to speed up a couple of things to achieve what I want to achieve before I step down. I provided the Board with supervisory Board with plenty of time to look for replacements. And I think that with Axel Herrberg being the Head of the Supervisory Board and the person who has been 10 years the CEO of this business. We have a fully capable person to guide the process. And I think that this will, as usual, in Gerasimo, if you take a look at continuity in management, the supervisory board will take will do an excellent job managing the process. And it is my full intention to stay on till the last day of my contract and do any necessary steps to help with the transition. On the Chicago high side, technically a good start up, complicated furnace, glass quality very good. We are still a bit working on the, what I call, the infrastructure, the surroundings. By the way, we will have a Capital Markets Day. No, not Capital Markets, we'll have a Customer Day, sorry, in Chicago Heights. So this plant will be the spot light of our customers in the first half of this year. So we are very confident showing the facility around and the achievements that this will be a successful story in the pharmaceutical market. Downside are generally in such a transition customer approval for new technologies. And in the pharmaceutical sector, you need to make change requests and approval for any type of technical changes in your manufacturing process that can here and there affect your ability to ship product from 1 month to another, but that is well underway. Customers are, so to speak, still daily there, auditing the plan until we have gone through the entire customer portfolio after the completion. I think that is the only timing downside. Technically, we are we look quite good. Depreciation for Centa, as we said during the acquisition that the CapEx will be around 4%, 4% to 5%. So depreciation shouldn't be higher then. So and that was one of the reasons why we always said the center is asset light or lighter than our normal business, and that also helps us to get down to the 8% CapEx, which we have as a guidance for the year 2016 and also up to the year 2018 because we changed from the acid heavy tubing business where we had a depreciation, which is on a yearly basis approximately 12% and also had then the positive effect for the group to the approximately 4% whatever for the center business. Yes, my question was more on the group level, apologies. I think post center you were guiding for group depreciation to be around 7% of sales in the medium term and currently you're guiding for 6% in 2016. So it was really a question about 2017 and beyond. What are your expectations now? Yes. But we are investing on that level with 8%. So we're not expecting that the depreciation will be down further. We even would expect up to the year 2018 coming from the whatever is the number for 2016, take 6.1%, whatever, it should go up a little bit with 0.2% up to 2018. But I'm that's it all depends which kind of CapEx distribution and so on and where it's depreciated. So somewhere around gives a good feeling, so it's not going back to 7% up to the year 2008. That's terrific. Thank you very much. Okay. Gunnar Romer, please, Deutsche Bank. Yes, good afternoon, everyone. Thanks for taking my question. The first one would be with plastics pipeline, whether you can share an update here and also potential launches from that pipeline, let's say, over the next 12 to 24 months. And then secondly, just coming back on the fair value amortizations, you've indicated, I believe, €28,000,000 for Centaur. Is the €15,000,000 underlying still a right number the right number for 'sixteen and going down probably to the high single digits over the coming years? And then last question would be with regard to potential impacts from the oil price. I think you've highlighted some of the potential impacts on the Centaur business. I was just curious whether you can give us some color on the impacts of the remainder of the business and whether near term this is a margin tailwind that's going to be significant or whether we can neglect that? With the plastic pipeline, the pipeline is quite good. We I can only reiterate that we are working on a lot of longer term projects. I would say there is not a single project that I would like to mention that could all of that is worthwhile being as a standout project such as a large inhaler line or a large insulin pen line of 50,000,000 or 100,000,000 pieces to be launched in the next 12 months. We actually, in this case, we should have already announced respective infrastructure investments in this case before we would even do that because that's generally the start. Don't forget that. 1st, investment in the infrastructure. 2nd, investment in the production facilities 3rd year start up of the facility. So for the next 12 months, I would not advise you to look for a single lighthouse project in the devices that makes up for most of the growth. We do have a lot of very, very, from my perspective, lucrative projects, some of the smaller volume case, but very attractive projects. And we have some very, very interesting long term projects that, again, could move the needle quite significantly. And we will keep you updated as we are more certain about the realization of those because you might remember that our customers can stop those type of developments anytime during the project unless we have signed a manufacturing agreement at some point. And once that would be the case, we would keep you posted. Oil price, yes, we have still a business even though that we have only 13 furnaces. That depends on energy cost a bit. So it will have an impact, the oil price indirectly on our glass business most definitely, even though that we use natural gas as a main source, but there's a movement of the gas price in line with the oil price. Unfortunately, not as strong downwards on the gas price as the oil price has moved down. And here applies what we have always said. When the energy prices move up, we have the ability to pass those on. If the energy prices move down and hit certain trigger points, we have to give customers credit on prices. This is expected to happen in 2016. I see that rather on the price concession side than on the price increase side in the glass business. And I do see the same in the plastic component business with the resin prices, and we have that figured into our guidance. The value amortization, we had last year means 2015. As I said, for Centra in Q4, approximately €7,000,000 fair value amortization out of the €22,000,000 means the rest is roughly 15 as fair value amortization for a normal year, and you should assume that this is going down. As I said before, the 15 is going down to approximately €10,000,000 in 2016. And then on top of that, you have then in 2016, roughly €28,000,000 euros for the February amortization center. Have in mind, that's all based then on €1.12 to U. S. Dollar because that's also what you have to have in mind. Perfect. Thank you. That gives you presenter or whatever are always based for sure on currency neutral numbers. Scott Bardo, please. Yes, thanks very much for taking my questions. Just 3, please. First of all, thank you very much for all the excellent financial disclosure this time around. That's very helpful. One of the things that wasn't disclosed, however, was the breakdown of your glass business to tubular molded. Historically, also you provided some sort of syringe numbers. And I wonder if you could just share at least those with the analyst community so we can track the sort of progress. There are some different moving parts of those businesses, including cyclical effects to some of them, the molded glass business. So that would be helpful. I wondered if you could also please clarify what the margin is for your ready to fill syringe business. That's something you shared with us historically. Just so we can gauge whether your investments in this area are starting to pay off? That would be helpful. That's question number 1, please. Second question just relates to leverage. You mentioned you're at about 2.9x levered, which is not a huge stretch compared to the history of Geroschheimer and that you expect to delever to about 2.5 times in the next 24 months. That doesn't seem like a particularly challenging target. If my math is correct, just the incremental EBITDA from the net effects of Centaur plus the Tubular business disposal broadly takes you without any absolute debt reduction to around 2.5 target next year. So I just wondered if you could share if there were any other moving parts that we need to consider there. And last question, please. Very encouraged to see CapEx continuing to trend down. Can you just give us an update as to why now you see 8%, whereas you had announced this sort of 8% to 9% range after the disposals? Also similar sort of FX environment. So I was wondering if there's been any structural change or any change in investments or things that lead you to be more optimistic about your future expenditures. Well, I might start with the CapEx question, and the answer is very simple. We do a strategic planning every year. We go through the needs of the business. We see where we have to invest based on projects and based on our machine strategy. And as we always have said, we have invested quite a bit in the past. And during this exercise, we realized that probably when we gave the 8% to 9% guidance, we were a little cautious not having completed that exercise at this time. But after going through that with the and going exactly through the effects of center for the portfolio and Tubing and the CapEx requirement of the underlying And that has really nothing to do with a different look at the underlying businesses. This is just the result of doing the homework more thoroughly than a week after the Centa acquisition. To answer your net debt question, as I said before during my speech, have in mind that we will pay out in February, I mean, Q1, the special effect for taxes out of the tubing sale of €35,000,000 which is an effect which you have to have in mind compared to the operating cash flow improvement in the year 2016 towards a one off. And for sure, I would be happy to be faster at 2.5 But first step is that we think that's our target to get at the 2.5 times. And again, we also if there is something which comes up, so we're not ruling out that we also can do something on smaller acquisitions left and right in products or portfolios or whatever. So the 2.5% for sure, our target is to be there in 24 months. Main reason for sure is also that we have to refinance, as you all know, in March 2018, our bond. And therefore, before, we would like to have a good financing situation that we have a good feeling how much we need and how we can do it. And that's mostly the target. You always can be better on that. But first of all, let us have center and all the other stuff. We changed our portfolio dramatically during last year. Let us see how the year runs, and then we discuss further during the year how the numbers will develop. And to your first question, I only have to say no because we already provided you with a lot of numbers also for the margins and all the others on the segments. And we won't go deeper than the numbers which we have given to you because I think that's already a lot. And some quarters I have to do, I should say, but I'm not doing that. Yes. I appreciate you provided a lot of numbers. Just to sort of refresh your memory, at the time of the change in divisional structure, I think you committed to updating the market verbally about the progression of these various businesses. So just given the various different moving parts and the investments in each, is there at least an ability to give us a feeling for what the magnitude of the ready to fill syringe business, molding business is, how they're growing would be helpful actually for modeling purposes. We have already made comments to that. We have the margin in the Primary Packaging Glass business went up in 2015 despite a very difficult revenue year. And as you guys know, we generally need volume to achieve price concessions in that business. Obviously, we did not achieve volume, but we increased the margins. I can tell you that most likely did not come out of the molded glass business in this case. So that has to come out of the businesses where we can improve the margin. That was mostly 2 below. And as I said before, in the Syringe business, I said we have made significant progress. I have told you about improved quality KPIs that generally show up in reduced costs. So I think you can take the assumption that the profitability of those businesses, what you call former 2 pillar glass, has developed well in 2015. And we continue to expect positive developments going forward. But that is as much as light as we want to shine on this at this moment. Understood. Thanks very much for answering my questions. Oliver Reindeer, please. Hello, can you hear me? Yes. Oh, perfect. Oliver Renberg from Kepler Cheuvreux. Three questions, if I may. Firstly, just coming back to net financials. If I I'm not sure, did you say we should expect the net financial income to be in line with 2014 or 2015, if you can just clarify that? And what percentage of your debt is actually currently subject to variable rates? That will be the first question. Secondly, I think in the U. S, there was a bill signed about 2 years ago called the Drug Quality and Security Act. I think this bill is mostly about a compounding center, but one side element of the bill also includes a requirement for manufacturers to put a product identifier on each package. Can you just talk about how this will actually impact Centaur and how this is going to be implemented in the industry? And then thirdly, I think there's also maybe long term trend towards smart inhalers in the industry. Is that something certainly you could also offer? Or could that be a certain switch in the industry demand? Thank you. With the interest rates, you can find them in our annual report on Page 114. You can also see in which area we have which amount with which interest rate. So that's hopefully pretty transparent. And then you can make your calculation what the average interest rate is. So if you do your exercise, you should come out between 2.6% and 2.7%. And I said 2014 number, not 2015 number, because in 2015, we had some special effects, especially the due to the refinancing of the revolving credit facility, the one time effect out of that. So and that's the reason why this number is not really comparable. For sure, if you look in the financial result, dependent on interest rates for pensions and how many gain you have, you can have a deviation of €1,000,000 up and down. But it's pretty stable going on forward. And then let me comment on the track and trace situation. We did, in fact, and I think that's a very good question, have that as one of our key components, while we did the due diligence on Centaur, together with industry experts, investigate that situation and the potential impact. On Centaur, the conclusion was basically that this will happen at pharmacies. And we do not expect an effect on the center packaging for the implementation of those laws. So from that perspective, we feel very comfortable that the issuer of the medicine, which is a pharmacy, has to fulfill those obligations and not the provider of the packaging to the pharmacy. On the smart inhaler, I would, for clarification, would ask you, can you specify what you mean with it? I think I have an idea. But before I hand for a question that I might interpret differently than you ask it, that you give me a little bit more color on what you are looking for here. Well, basically, smart and haters is that you try to track with certain centers where the patients are taking their respective dose. And that is what I thought. We certainly work with being the largest supplier contract manufacturing supplier for inhaler in the world. We certainly work on innovative concepts with a number of our customers for improved drug delivery and traceability and compliance devices. And yes, if those type of developments will see market acceptance, we would be capable of delivering that together with our customers that generally own the IP to the market. That would be for right into our sweet spot. Great. Can I just kind of brief you back to this kind of U? S. Act? Whose responsibility is it funding? I mean, there's various parties involved. The way I read it, it's up to the manufacturer, but you also have parties involved that are actually doing this kind of machines in which you put your plastic devices and there's also the kind of pharmacy. Who is ultimately responsible and who is bearing the cost of that? It looks in the interpretation on the implementation that the cost is with the pharmacy because the pharmacy runs a container. We actually do not put the container into the robot. It is a pharmacist who controls that process, who make sure you know that the appropriate tablets are filled in the appropriate silos and that the process runs right. So that is basically like an extended filling as you would have it in a pharmaceutical company. And that is why industry experts and pharmacists basically see that responsibility clearly with the pharmacies. For that type of drug dispensing systems. You know that it is different within pharma companies liquid products, that then basically goes with the pharma company. Right. Last follow-up with me on that. But that would basically imply that according to the law, it's a responsibility of the manufacturer. But in this case, you assume that they pass on this responsibility and basically rely on that the pharmacies are doing that. Because normally, if you just think about it, obviously, an existing system will not change overnight, but would not be simply moving towards blistering be the easiest solution for a manufacturer? Could be the, but the manufacturer in this case doesn't bear the cost because it's a pharmacist because that's a dispensing system. And that basically creates the hurdles and no and a little interest for the pharma companies to take on the packaging because today, they deliver for those type of products, tablets, they deliver bulkware. There is no branding on the bulkware. Don't forget that. It is for most of those medicines are generics. So on the label, we have here a number of those packages on the table. You basically have the active ingredient mentioned on the table that is prescribed. There is no brand name for the manufacturer. And I think, particularly with enhanced discussion on drug pricing in the United States, where pharma companies providing lifesaving patented branded drugs and increasing prices, there is a strong push in the health care system for the pharmaceutical environment to keep health care costs low. And the only way to do that is basically avoid any type of branding to get to price diversification on those type of products. And the best way is a standard packaging product with a label and nothing printed on who is the supplier. So that is basically the outcome of the investigation. We have done that there are too many many aspects in the process that would not make it likely that the packaging goes away to the European way of packaging tablets. But it's still on basically to be implemented late 2017, correct? Yes. Definitely. But you know, in the regulated environment, anything that is implemented 2017 needs to be basically already working in 2016. That is the case. So we do not see a risk. Okay, perfect. Thanks a lot. So as there are no further questions, we would like to thank you for joining us today. Thank you very much. And please note that we are going to publish our Q1 results on April 13, 2016. Thank you, and goodbye.