Earnings Call: Q1 2021

May 14, 2021

In the Q1, ladies and gentlemen, Grupa Azote Group reported consolidated revenues of PLN 3 point 3.6 billion and our EBITDA stood at PLN 305 1,000,000 while net profit in the period 1,000,000,000. These financial highlights are consistent with our earlier estimates with which you obviously are familiar with percent. You're familiar? Our results should be considered relative to the very challenging environment we operated in the period. Last quarter, So very high dynamics of rising prices. So the raw material is a very fickle, intangible weather. Supply chain disruptions, which show the whole range of the challenges faced by the group and the need to flexibly adapt to an extremely volatile business environment. I'll discuss this I will discuss now the main highlights and the brief summary of these highlights in the Q1 of the year. The Supervisory Board of Grupo Azote appointed on the 18th May this year, the new member reported to Pazote Esa for the new wealth term office. And Mr. Thomas Hintz was appointed as the President. Mr. Mario Scrapp was appointed as Vice President of the Management Board of Grupozzo Tejas. Mr. Filip Gregoortriek 6 was appointed as Vice President and myself as Vice President of the Management Board. Mr. Myrogyz Kranzialowski was appointed Vice President of the Management Board Mr. Marek Madovsky was appointed vice president of the management board and Mr. Last but not least, Mr. Signet Patrodsky was appointed as member of the management board. Let me add that Mr. Signif was a member of our a supervisor of BOTF for many times, many years. Percent. So he has a lot of knowledge and in-depth knowledge of the group. Other highlights was included the group percent, joining the European Clean Hydrogen Alliance. This alliance was launched by the European Commission in July 2020 in order to promote hydrogen as a competitive energy carrier across Europe. And at Grupo Azote, we are conducting both economic and technical analysis of the production of hydrogen from renewables in order to produce the so called green hydrogen. Joining the European Clean Hydrogen Alliance is therefore a natural step in that direction. It's also worth pointing out that half of this hydrogen produced in Poland comes exactly from Gopa Azote production facility. As a reminder, Gokhale is also a very is very actively engaged in consultation from the Polish hydro strategy. Percent. On 11th May, we also announced that we entered the market of fully biodegradable plastics. And we launched a pilot production line for the production of thermoplastic starch with a production capacity of 300 8 per year. This new patent is a response to the directors of the European Parliament promoting the idea of circular economy. Moving on to our investment program. We are continuing our ambitious investment billion. And the CapEx figure for the entire group as of the group in the Q1 of 2021 percent were CLN 914,000,000 of which growth CapEx accounted for 632,000,000. Investments connected with business maintenance, we percent. We spent CLP34 million. Mandatory CapEx stood at CLP216 million and other, including percent. The purchase of finished goods and repairs of components amounted to CLN 31,000,000. The lion's share of the goods spending is on the Poise Provenere Poise project. This is the flagship project of the group, announcing to TRY 5 60000000 and on the construction of the power unit at Plaguabe, for which we allocated PLN 201,000,000. The current stage of completion of the Polymeri Polita project exceeded the 57% mark, but I believe that this project will be discussed in more detail by Mr. Scheiberes later on. Let me only remind you at this point that in February, Grupo, Elodate Poly Elephants, received the confirmation that the Conditions precedent for the credit facility agreement had been fulfilled, which means that we successfully closed the final stage of the process intended to secure debt financing for the polymericoinsa project. Let me now move on to the detailed discussion of the performance of the individual adopted group companies. Ladies and gentlemen, as I said at the very beginning. And this is a very challenging Q1 of 2021. All of the leading Grupa Azote Group Companies percent generated net profit. And most of group companies, the revenue was higher year on year. Percent. And in the case of the company's stand alone, Grupo Azote SaaS revenue. It remained flat at last year's level. In the case of CompuXper, the first quarter turned out to be the record breaking quarter in the group's history, significantly also contributing to the group's EBITDA. And also Grupo Aso Te Pune and Grupo Aso Te Kengejian also reported higher EBITDA than last year. We will discuss it in more detail later on. Those results are approved that the group, as of the group, is able to flexibly adapt to the very unprecedented, the nonstandard pandemic reality. In a nutshell, our macroeconomic factors obviously involve the aftermath of the COVID-nineteen pandemic that still persists. But we see the first signs of recovery. They're already around the corner. Percent. And the World Bank forecast that Poland's GDP could grow to by 3.3% in 2021 and up to 4.2% in 2022. Also Statistics Poland announced that in the Q1 of 2021, Poland industrial output sold increased by 7.9% year on year. And also workforce productivity, as measured by output sold by employee, by own employee, was Also on the increase in the PMI index for the manufacturing sector came in at 63.4 points, this is the highest level reported since June 1997. As for our energy commodities, The turmoil in the economy, the economic turmoil had a direct impact on growing energy commodity prices. The electricity prices in relation to Q1 of 2020 increased by 55%. We unfortunately expect that those electricity prices will stay at the same level. And hard coal prices went up by 19%. In Q2, we expect that the price level will hold. Percent. The group companies have contracts in place securing the contracted volumes, and they are executed percent as planned. So we see no services in that area. As regards to gas, more than 98% of the gas consumed across the group in the Q1 of 'twenty one came from Pagimiga. And mid January prices in Asia hit record highs as There was a very severe cold weather. European markets reacted sharply and nervously, and the gas prices shot up to €0.19 €26 per megawatt hour. Afterwards, gas in Europe consistently fell to the level of €16 at the end of February. However, in March, we saw a slow but steady increase in spot gas prices. And obviously, the weather was the key driver with temperatures in Europe remaining below the long term average. Asia remained a more attractive market for LNG suppliers. Therefore, LNG supplies to Europe remained very weak. Gas prices were also supported by rising coal and CO2 emission allowance prices, which broke the psychological barrier of €40 per ton in March, making gas More attractive alternatives and more attractive alternatives to the power industry. Gas stocks in the EU were declining rapidly. And as a result, the gas prices in European hubs in the Q1 of 2021 increased almost by almost twofold year on year. Those factors, combined with the upgrades of percent. The Norwegian Gas Infrastructure scheduled for May, based on that, we can expect relatively high prices later this year as well. In the Q1 of 2021, prices of CO2 emission allowances, that is new allowances, on the exchange market were quoted in the range of €31,000,000 €42,000,000 continuing the strong upward trend started in the last quarter of 2020. The price of 1 EU allowance increased 3x over 12 months relative to the very memorable low recorded in March last year and reaching EUR 42.6 per tonne at the end of the Q1 €49 per tonne at the end of April. As you probably know, the press sessions in May saw the prices rising above €50 per ton. The upward trend accelerating in the Q1 was spurred directly by the percent, green light, given by the European leaders in December last year to the European ambition European Commission's ambition proposal 4 emission reduction targets. In the European Union, that is 55% emission reduction target by 2,030. Percent. This booming global energy markets these booming markets created a favorable landscape for speculation funds, which can obtain high percent, raise of return on their investments in emission allowances, which obviously spurred prices as well. Percent. The dynamic market situation obviously had an impact on the group's performance. In the Q1 of 2021, the Grupozzotech Group recorded consolidated revenue of PLN3.3 billion, up 8% year on year. Percent. The main drivers for the increase in revenue were price increases percent across all Grupo Azote Group's segments, going up by PLN235,000,000, supported by the simultaneous growth and sales volumes of compound fertilizers, up CHF23 1,000,000 as well as chemicals, up by CHF38 1,000,000. However, $1,000,000 These increases were offset by a PLN 21,000,000 decline in plastics and an approximately PLN $113,000,000 decline in nitrogen fertilizers mainly due to weather conditions, which resulted in an extended application period well into the quarter in the second quarter and a high level of last year's stocks. Percent. Revenue growth was also supported by Combo Expert, as I mentioned before, in the amount of PLN $76,000,000 both in terms of prices, up 27,000,000 PLN and volumes up €57,000,000 The higher euro to PLN exchange rate was also a positive driver behind the group's consolidated revenue. EBITDA generated in the Q1 2021 amounted to €405,000,000 and was down 8% year on year, mainly due to the higher dynamics of growth in feedstock prices relative to the price of products as well as the growing prices of CO2 emission allowances. The increase in price of energy commodities with gas prices going up by over 70%, electricity by 5%. And coal as well reduced the overall results by BRL 257 1,000,000. Higher prices of CO2 emission allowances were estimated at PLN 47,000,000 On the other hand, Compound Expert supported the group's EBITDA relative to the Q1 of the previous year, contributing PLN22 million to the group's results. The OXXO business reported EBITDA higher by 3.5x year on year and the results of the segments segment were also very stable. As we can see, EBITDA bridge was mainly affected by increases in product selling prices going up by PLN335,000,000, percent, combined with a simultaneous increase in the expected cost of production by BRL234,000,000 mainly percent due to higher natural gas prices, which drove down EBITDA by BRL 246,000,000. Percent. The decrease in other operating expenses mainly associated with the polymedia polyta project, including the sale of infrastructure last year. The increase in other revenues was driven by higher demand for sales of heat due to 3rd party clients as a result of lower temperatures. As regards selling costs and general administrative expenses, total savings amounted to CLP311 1,000,000 compared with the same quarter last year. I should emphasize at this point that the group's financial situation is solid and stable, percent and group cash and cash equivalents provide an additional guarantee of our liquidity amounting to As at March 31, 2021, amounted to PLM 430 $4,000,000 together with cash in bank. The group has 3 financing limits amounting to PLN 7,400,000,000 as of March 31, 2021, of which group has got the polyelephants percent. Special purpose credit limits for the financing of the Polymedic Polytech project amounted to CLN 5,100,000,000 and a free reverse factoring limit of TRY296 1,000,000. In summary, total cash and free financing limits as at March 31, 2021, amounted to CLN 7,800,000,000. Percent. Moving on to discussing the group's segment performance in more detail. In the Q1 of 2021, the agrofertilizers segment reported the highest contribution to the group's revenue at percent, including 16% generated by Combo Expert Group. The Chemicals segment's contribution was 24% And the Plastics segment generated 12% of total revenue. Percent. On the next slide, number 15, on market environment, you can see market spreads for nitrogen and compound fertilizers. Percent. These prices followed an upward trend. And in the Q1 of 2021, they went up on average by about 6.5% year on year, percent, including an increase of more than 8% for nitrogen fertilizers and more than 4% for compound and specialty fertilizers. At the same time, the key factor behind The cost of nitrogen fertilizers was the gas market, obviously, which had an impact on ammonia prices as well. It was a significant driver behind the pricing strategy of all fertilizer manufacturers and both gas prices and high prices of CO2 emission allowances as well as unfavorable weather conditions extended the application season and the pricing policy was therefore continued. Additionally, a disrupted demand supply balance for fertilizers resulting from, among other things, limited imports, supports high price levels. I can follow-up words now about the agricultural market. In the Q1 of 2021, the percent. COVID-nineteen pandemic had no significant negative impact on the Polish agricultural sector, which obviously makes us very happy, percent, at least in Poland, in the agricultural sector in Poland. And the crops are currently considered to be at a good level percent despite the persisting low temperatures we are still experiencing. It is estimated that in the Q2 of 2021, the situation in the percent. Agricultural market is not expected to change significantly. And according to the Agency For Restructuring on Modernization of Agriculture, the payout level Of direct subsidiaries is estimated at 98% out of the total, which most likely means that the domestic percent. Agricultural sector has received most of the subsidies. The Fertilizer segment in the Q1 of 2021 percent reported an approximately 5% increase year on year. And as percent. Prices increased. There was a parallel decline in the sales volume of nitrogen fertilizer, going down by nearly 12% due to percent. The extended application of Natrium Fertilizers, even for the second application, into the 2nd quarter. This decline was offset by compound fertilizers, which percent. This is where sales volumes went up by 10% year on year. The positive volume effect in compound fertilizers drove up a higher year on year revenue by PLN 80,000,000, including over PLN 50,000,000 contributed by compo experts. Percent. Lower imports of competitive fertilizers also had an impact on the domestic market. Lower nitrogen percent. Fertilizer sales were caused by a significant shift in the time of application caused by unfavorable weather conditions lingering winter, minimizing the Negative effect of strong increases in gas prices was also a challenge we had to face, percent, especially in the period that those declines were reported in previous years. Percent. However, it should be remembered that the end of the Q1 is by no means the end of the nitrogen fertilizer season. Percent. And for the reasons we have discussed, we expect that the seasonal sales of nitrogen based fertilizers will be extended percent, and the volumes will be moved on to months to come. The Chemicals segment. As regards titanium white, in the past quarters in the past quarter, quarter 1, we saw strong interest from buyers significantly higher than expected in the typically low season, coinciding with the full winter period. Despite the limitations due to COVID-nineteen and the winter weather, Demand was surprisingly solid. With the onset of the high season in April, we see increased demand for titanium white. It is to continue and will be supported by low availability of imported titanium white volumes and the buyer's strategy to maintain safe stock levels uninterrupted production. European contract prices went up in response to a booming market in China, high shipping costs, increased demand and higher costs of titanium wipe raw materials. In the Q1 of 20 20 21, the VLTP prices went up by 46.8% versus the Q1 of 2020. So due to the problems with the availability of oxal alcohols, the availability of plasticizers in European market, which was also lower. This was particularly evident in March when 3 key producers of plasticizers announced a forced major event. In the near future, we expect price stabilization in the OXXO area. Crude oil and naphtha prices and the availability of propylene are the key drivers in that area. If propylene processors reopen their plants while producers announce maintenance shutdowns, Propylene prices may return to a growth path, which will consequently stimulate prices increase in prices in the OXXO segment. Currently, there is a solid demand, supported by lower imports from more distant destinations. Percent. This is mainly due to high freight costs and problems related to logistics. Percent. Moving on to the next slide, number 18, the Chemicals segment. Despite 8, revenue growth of PLN 129 million. It was not able to maintain last year's EBITDA margin mainly percent due to high gas prices, which affected the performance of the melanin and technical grade urea businesses. On the other hand, solid results were generated by the OXXO business, which took full advantage of the market situation with a noticeable spread increase. Percent. Better results were also recorded in the software business. The pigments business, on the other hand, maintained a very stable 2020 level margin levels. Moving on to the Plastics segment. In European Plastics segment market, in the 1st month of 2021. We saw high material prices raw material prices and continued solid demand from all processing segments percent, resulted in higher prices of caprolactam and polyamide, combined with supply limitations, such as percent, low inventories as well as regional and global headwinds experienced by some producers. Price of key raw materials in the Q1 of 2021 versus Q1 of 2020 had a varying impact on EBITDA given slightly higher benzene prices combined with slightly lower phenol prices. Percent. However, it must be stressed that compared to the Q4 of 2020, average European quoted 10% pesos in the Q1 of 2021, increased by 59%, And average finagle prices went up by 20%, reaching levels not seen since the second half of twenty eighteen. On the back of the strong demand growth as of the second half of twenty twenty, the pandemic also caused a shortage of shipping containers as well as a sharp increase in freight price, especially en route from Asia to Europe The hurricane season in late 2020 in the U. S. A. And the subsequent February storm on the Gulf of Mexico, percent. The cost temporarily stopped production of much of the U. S. Chemicals sector producers. In Europe, both planned and unplanned shutdowns led to force majeure events and supply shortages. The week long blockade of the Suez Canal in late March also put more pressure on supply, which resulted in high prices as well as many products are heavily dependent on imports from the Middle East. The Q1 of 2021 also saw high demand for virtually all PA6 applications as well as limited supply. The demand for PA6 was high across all major industries, including the very percent. Key sectors such as automotive electronics appliances, construction and packaging businesses percent. For the remainder of the 2nd quarter, demand and supply situation in all PA6 application markets And the price of petrochemical feedstocks are expected to drive up prices. In the coming months, demand will depend on the activity of end consumers, obviously. And for the remainder of 2021. The outlook remains optimistic, which obviously makes us very happy, although still very cautious with the pandemic still in the background. In such a dynamic market environment, the Plastics segment reported an increase in revenue 4% year on year from PLN 3.70 3,000,000 to PLN 387,000,000 and an increase in EBITDA margin from a negative level in Q1 2020 to 2% in Q1 $21,000,000 EBITDA grew from minus $2,000,000 to PLN 8,000,000 on the back of higher margins. It should be also mentioned that currently in the Plastics segment, it covers the results of GA Poly Elephants. Without the contribution from Grupo Azote Poly Elephants, that is €4,000,000 in 20.20 €11,000,000 In 2021, EBITDA increase of the Plastics segment proper would be BRL 7,000,000. The segment revenues were supported by continuing demand in target industries and limited market supply of polyamide in the market, combined with an increase in contract prices based on the benzene formula. I will now move on to Grupo Azote Fuabe Group, which I am the President of the Management Board of. Percent. In the group, as Atoforebe Group's consolidated revenue in the quarter 1, 2021 amounted to PLN 1,011,000,000, up by PLN58.1 million or 6.1 percent year on year. Consolidated net profit amounted to PLN33.4 billion in the Q1 of 2021, down by PLN47,300,000 or 58.6 percent relative to quarter 1 20 20. The main drivers of the group Azote Group's Performance included increase in natural gas prices above 70% as well as high prices of fertilizer products, technical grade urea, melamine and capital lifetime. The in terms of sales to 3rd parties, anchor segment was the greatest contributor due to the composition of the segment, obviously. And the contribution stood at 85.2% in the agro segment. Percent. Higher revenues were also reported across all segments of the group Azotek Huabe Group. The consolidated EBITDA of Grupo Asset CoAB Group in the Q1 2021 stood at €107,700,000 down by 61 point €8,000,000 or 36.4 percent versus the Q1 of 2020. Percent. On account of price increases, EBITDA went up by $81,000,000 but dropped by $23,000,000 on the back of lower volumes. However, those results were mostly affected by the prices of raw materials, especially natural gas. Percent. Another significant driver were the higher costs of CO2 emission rates, up by over BRL 25,000,000 year on year. Percent. Due to higher prices of initial allowances, we must remember that we had percent. Other baselines across the top part of the group and other accounting treatment, which we announced in August 2020 in a current report. All in all, the cost of sales increased by PLN124.2 million or by 17.9% compared to the corresponding period of the previous year. Moving on to a segment breakdown in the agro segment. EBITDA went down by BRL58.6 million year on year. The agro segment's revenue increased by $41,700,000 or by 5.1 percent on the back of higher sales prices, especially of melamine, ammonium nitrate and urea, percent, which translated into revenue growth of BRL 75,800,000. Unfortunately, lower sales volumes were reported, which resulted 9 and segment revenue by BRL34.1 million. These were related to, as I mentioned previously, percent. And to the maintenance works carried out in that period and due to winter lingering winter, in accordance with our Scenario, it shows that we'll see a positive shift in May April. Unfortunately, percent. The melamine segment had a number of breakdowns percent in melamine production units as well as certain mechanical problems and melamine to synthesizer. It should also be mentioned that we the maintenance works carried out in that period were shifted year on year. The cost of products, goods and materials sold went up by CLN 100 and 4,000,000 or 17.9%. In terms of plastics, the EBITDA of the Plastics fell by PLN 9,700,000 year on year. The increase percent in revenue in the plastics segment by 3.4 percent in PLN or by 3.5 percent was driven mainly by higher selling prices, which translated into a revenue growth by PLN 3,400,000 PLN. Percent. The cost of products, goods and materials sold increased by BRL 12,500,000 or by 12.7%. The main factors behind the increase in the cost of production of caprolaxonepar from higher price of benzene was a sharp increase, obviously, in the price of natural gas. As you know, it is a feedstock in the production of capitalized and intermediate products. Moving on to our investments. In the Q1 of 2021, group of Alto Fuego Group incurred capital expenditures of approximately TRY 289,500,000. The largest CapEx was earmarked 4,000,000,000 for the following projects: construction of the power unit based on coal fuel, condensation of the electric asset plant and construction of the new units of the new units for the production of electric percent. Granular fertilizer plant based on ammonium nitrate and modernization of the steam boiler to reduce NOx emissions. And last but not least, replacement of the TG-one turbine unit. In 2021, the group plans to percent. Incurred expenditure on property, plant and equipment as well as on intangible assets in the amount of 996.9 million. We successively and consistently conclude contracts for investment projects percent. And in the value of signed but not yet completed major contracts as of March 31, 2021, is approximately Cofo 756,800,000. For obvious reasons, most of these investments are located in Plovest. Our ongoing investment program and the need to secure financing was one of the main reasons behind the recommendation of the management board of Huawei to allocate the entire profit for 2020 to statutory reserve capital. And let me mention at this point that our priority is always to Continue our investment program, and we see no delays at that point, percent, which means that any planned commissioning launches should progress as scheduled. In summary, the Q1 of 2021 brought about the 3rd wave of the pandemic and a high COVID-nineteen incidence rate, which also affected Grupo Azzotefuabe. However, fortunately, the Increased sick leave, absentees, has no impact on our production processes. As the group of the entities comprising our group, Grupoisotecuabe Group, It's very diverse. The impact of the pandemic on the operations, the performance and financial situation was varied but also mitigated. However so we can say that, in general, this year's lockdown had no significant impact on the group as a whole. And as I said, our major CapEx investment plan progressed as scheduled and our growth plans as well. As we have previously announced, we also successfully launched the new line of our Phos Farm products, percent, which are modern and environmentally friendly compound fertilizers. I should also add that On March 22, 26 this year, we had an internal audit held at percent to recertify the integrated quality environment and safety management system and to move on to the requirements percent of the new health and safety standard, ISO 45,01, 2018. The audit was success was a success, and the company received a recommendation to maintain the certificate of the integrated management system 4, compliance with the current applicable standards. Thank you very much for listening, and I will now give the floor Over to Mr. Michal Shebeilski to discuss the performance of the group Azzotopolitegroup. Good morning. In the Q1 of 2021, at Grupa Azote Politek Group, We reported consolidated EBIT and EBITDA higher than in the corresponding period 2020. Our EBITDA figures will be presented in more detail on the following slides. On a stand alone level, the Parent company reported also net profit of PLN 42,000,000. It was also higher than in the previous year. The Q1 of 2021 was the First, full reporting period in which the parent company no longer had control over group eyes of the polyelephants, and which was consolidated based on the equity method. And its contribution to the group's results is recognized in the income $1,000,000,000 Under share of profit of equity accounted associates, currently, Grupa Azotepolisa holds a 34.4 percent stake at Grupo Azotepali Elephants. The consolidated net profit for the Q1 of 2021 amounted to PLN 1,000,000, down 7,500,000 year on year. A significant item affecting the consolidated net result in the Q1 of 2021 was percent profit loss on shares and associates accounted for using the equity method, which was down 25,500,000. It's related mainly to Grupa Azotep Poly Elephants, resulting largely from the valuation of the company's financial instruments, percent cash flows of the Polymedicpaisa project, which were executed in accordance with the requirements of the credit facility agreement and resulting from the secured financing in and payment in euro, for which no hedge accounting can be applied. In the reporting period, there was no significant negative impact of the pandemic on the on our operations and key processes. In terms of sales, there was no negative impact on demand for compound fertilizers and nitrogen products. The demand for Titanium White remained very strong. The company was also not affected by increased sick leave absentees among our employees, which would which could obstruct continuity of its operations, and we do not see any production limitations due to the pandemic. Percent. Revenue increased by 11% relative to the Q1 of the previous year as a result of dynamic rise in market prices of compound fertilizers, ammonia and urea. Revenues amounted to PLN780 million, and it was one of the higher figures reported for the Q1 of the year over the last few years. The consolidated EBITDA for the Q1 of 2021 stood at PLN 61,000,000, up by over $18,000,000 compared to the figure reported in the Q1 last year. At the stand alone level, the company's EBITDA was also higher in the first quarter 2021 year on year, up by nearly PLN 13,000,000. The realized EBITDA level was driven up by higher sales prices across almost all product groups following the marked improvement in the global market situation. Moreover, Our figures We're also driven by higher sales volumes of compound fertilizers, reduction solutions from the RedMonks Group as well as Centennial White. Also had a positive contribution to the results. The favorable impact of sales was offset by the significant increase in the price of natural gas relative to the corresponding period last year. In case of the company, it was about 74% of average, which was mainly due to lower supply of LNG to Europe and consequently low GAAP stocks in European warehouses. We also saw increases in the prices of crude oil and CO2 emission allowances as well as coal. However, the company had, to a large extent, secured allowances for 2021 on the back of purchases made in previous years. Therefore, the impact Of this factor, it was significantly lower in comparison with the market. The purchase prices of The following feedstocks were lower than in the Q1 of 2020. These included flotation salt. However, the impact was much lower than the negative consequences of the rising gas prices. In the Fertilizer segment, the revenue for the Q1 of 2021 reached over PLN 600,000,000 PLN, clearly above the corresponding quarter of the previous year. EBITDA in the segment stood at nearly PLN 40,000,000, which is up by over 30% versus Q1 of 2020, with EBITDA margin higher by 1 percentage points. The Fertilizer segment's performance in the Q1 of 2021 was driven by 2 opposing trends. 1st, percent. Significant improvement in the segment sales, with a marked increase in selling price of compound fertilizers, percent, especially phosphate fertilizers as well as nitrogen products as well as higher sales volumes in general of fertilizers percent. And second, significant increase of natural gas prices, price of CO2 emission allowances as well as other energy commodities, such as electricity and coal. Percent. High prices in natural gas higher prices of natural gas compared to the previous corresponding period significantly impacted percent, the fertilizer segment's performance. At the same time, higher segment sales and lower prices of some raw materials used in the production percent of compound prices such as phosphate rock, partition salt and sulfuric acid made it possible to somewhat offset the negative impact of rising gas prices. The Pigments segment, segment revenues stood at PLN96 1,000,000, slightly above the Q1 2020 figure. Percent. EBITDA stood at PLN 16,000,000, only approximately PLN 2,000,000 down, below the level 4 in Q1 2020 with the margin going down by 2 percentage points. However, it still be considered against The market reality and which is considered to be still very solid in the Pigment segment, high demand for titanium white was recorded in the Q1 2021. A large extent, higher volumes and sales prices offset the unfavorable impact of rising natural gas prices. Percent. In addition, there were changes in the consumption structure of main feedstocks due to trade restrictions affecting the segment's main customer. Percent. Large volumes of iron sulfate from the landfills also decreased significantly. In terms of our CapEx program, over the 3 months 1st 3 months of 2021, Grupo Adote Polise Group percent. Spending on property, plant and equipment as well as intangible assets amounted to 24,000,000,000. And the key investments were continued, including modernization percent, an expansion of the water treatment and demineralization station, which will make Krupa Azotipurica independent of the periodic increased salinity of the Odra River and enable its use as the only source of supply. This investment will also make it possible percent to secure supplies of demineralized water or Grupa Adoptepolyelephant's installation and also upgrade of the polyester main transformer substation, which will support the electrical power distribution for the 9 Propane, the hydrogenation and polypropylene units. In addition, we have the following projects percent in progress. Recycling of a steam of pure oxygen hydrogen as a byproduct for propane dihydrogenation of polypropylene unit and the ammonia production plant. The value of this project is about 13,000,000 and also a replacement for of the absorption power to maintain continuity of operation of the sulphuric acid unit order to avoid potential failures. This investment is worth over CLP 16,000,000. In terms of the Polymeri Polite project, I will now give some more details on this flagship investment. It is percent in progress. And as planned, we have received 46 pieces of large site equipment at the construction site, including a propane polypropylene splitter, which weighs around which weighs 889 tonnes, Polypropylene tanks, transformers necessary for the operation of the future power system and as reactors for the production of polypropylene the Q1, assembly and installation of the equipment also started. Blending silos, which were previously percent prefabricated on-site or installed on foundations. These are the key components of the PP installation in which polypropylene will be stabilized. In the area of the handling and storage terminal, outer shell of an ethylene tank and propane tank percent was completed. And the installation of support structures and roof shaping for the propane tanks is nearing completion. On completion, Hence, we'll proceed with the roofing operation and begin the installation of internal tanks. Ward is also underway to dredge a portion of the fairway waterway covered by the PolyMetropolica project. In the Q1 of 2021, Grupo Azote Poly Edisons purchased 3 precious metals, that is platinum and palladium, necessary for the production of oleflex and SHP catalysts. Percent. In summary, in terms of our highlights, I'd like to point to the fact that on $1,000,000,000 February 25 this year. We received from the credit agent a confirmation that the conditions precedent for to the credit facility agreement had been fulfilled. As a result, after fulfilling specific conditions for the 1st disbursement of each facility As well as on fulfillment of additional conditions for its disbursement, Grupa Azote Poly Adelson may percent, apply for the disbursement of funds from the facility secured for the Paliomedica project. This means that Final stage of the process of obtaining debt financing was successfully completed, as Mr. Hoejanovic has mentioned before. On the 29th April, signed a letter of intent to make land property available for the construction of the Western Ring Road, in Cetin. Grupo Alto Sotapolica also donated 100,000 to the Pomeranian Medical University or the purchase of laminar flow cabinets where the process of characterizing and preparing the isolation of the coronavirus RNA 6.8%. It was yet another contribution of the company to the fight against the coronavirus since the pandemic outbreak. We have donated more than TRY 1,000,000,000 for that purpose. Another highlight was the fact that on 30th April. The Supervisory Board dismissed all members of the management board for the 8th term of office and appointed members of the management board for this month's term. Thank you very much for this exhaustive discussion of our performance in the Q1 of in the year. And thank you for joining us. Thank you very much. Goodbye.