DSM-Firmenich AG (DSFIR) Earnings Call Transcript & Summary

Well, and here it is. So why dream small, if you can dream big. And that's what we've done. We are dreaming big. And you have dreams on your own. This job will be with us for this day. So if you have dreams for DSM-Firmenich, just put them in. You have the opportunity for the whole day. I'm not guaranteeing all dreams will come true. We'll get a bit of a feel on what you think the dream for DSM-Firmenich is. Today is about the dream we have, building a company where we bring progress to life. And the dream all started poof a couple of years ago, and we announced it 2 years ago in Paris. And I think that was quite a moment and you see the room on the screen. And remember, we just closed about a year ago. So we just recently celebrated our 1-year anniversary. I don't know about you, but when I was 1 year or a young kid that was an exciting anniversary. And it still is. But it shows the journey we are on and that's exactly the journey of today. I want to show you the steps of that journey in bringing progress to life and filling that pot with all types of dreams. And it started with the dream a couple of years ago with the signing and closing last year. What was that merge. And you see that here on screen, the merge part, bringing 2 iconic companies together. And like Ralf said, in pretty difficult macro circumstances. And I'll come back to the measures we're taking a bit later. We've decided in that context to review our portfolio. And in February, we announced to the world and to all of you that we find a new home for ANH because we think it's better served for ANH as well as for DSM-Firmenich to be more human-focused consumer-related company. That's the step in the journey, which we've seen here, which we call focus. Then with the consumer-focused company, we have pulled forward the review of our portfolio. Originally, that was planned for '24 than in the current circumstances. We did that in '23 and the outcome we will present today with you. So we looked at our portfolio. We looked at where we would accelerate where we want to grow and maybe we want to deprioritize. And then we'll end up in a phase which we call accelerate. And the accelerate phase will be grow the company we have, grow what we have, grow what we have decided for. And we'll run you through. And throughout the day, you get a bit of a feel in the breakout sessions, how are we going to grow what we have. That's the journey of today. And let me lead you through for all these steps a little bit with a bit of color from our side. So let's start with the merged part. And if you are a bit confused where you are in that journey, you see it on the screen, merge and I go to focus, I go to June and then I go to accelerate, right? So then you know where we are on that journey because it went pretty fast also for ourselves. So it's good to remind you. So I'll take you through that journey. On the merge part, difficult market circumstances. You see that here and we've addressed them pretty strictly and rigorously. We accelerated our synergy program, our integration program. And I think we've already seen the measures of success last year a little bit with full throttle, also this year. Secondly, we started our vitamin transformation program. Also with delivering the savings last year and this year. And we've pulled forward our portfolio review and we decided to have ANH find a new owner and have these in family with the consumer scope more into health, nutrition and beauty. And within that ANH strategy, we reviewed a few dimensions why we came to that decision. First of all, you see the market cyclicality, the volatility in itself. And you see a little bit of the extremes and ANH is a bit more volatile throughout the cycle. Second element, which we looked at in ANH was the capital intensity with its fantastic infrastructure of assets on vitamins and ingredients. It also requires a slightly more capital expenditure and investments to keep that up to par. And if you run these assets, you need to run these assets up to par, and we have seen many examples over the last 5 to 10 years, what happens if you don't. I will not be specific on the example, but if you run it, you need to run it safely and you need to run it credibly. So this business is slightly more capital intense. And thirdly, if you look at the third reason, if you look at the integration part and remember the synergies, which we put out, the EUR 350 million, of which half was cost, half was revenue synergies. The revenue synergies were predominantly in the other business units; Perfumery and Beauty, Taste, Texture and Health and Health Nutrition & Care, not in Animal Nutrition & Health. So also in terms of cohesion, we think that ANH is better suited with a new owner and we focus on the consumer part. Then on that process of ANH, a few timelines because we also get questions [indiscernible] already announce a deal? If you know that business a little bit, it will take some time to carve it out. It was already a separate business unit within DSM-Firmenich, but there are interrelations and assets carve-outs would need to be made, let alone IT systems and legal entities. So we are in the midst of that carve-out procedure, and we try to finalize that a little bit towards the end of this year so that in the second -- in the first half of next year, the first half of '25, we can start the transaction process with the ultimate goal towards the end of 2025, but don't pinpoint me exactly on the right day, but towards the end of '25 to have a deal, which is signed to close, which still needs all types of governmental and external approvals. That's the time line for ANH. Well, if we then have that company with ANH put somewhere else, we have our consumer space for DSM-Firmenich. The consumer space plays in the market where we really feel the macro trends are helping us. And let's share 3 of them. There are many more and throughout the breakouts and presentation of the BU presence, you will see a little bit more. But the first trend is lifespan vitality. In every phase of life, health, nutrition and beauty plays a more and more important role, which definitely help us. Even in the younger generation, the percentage of health, nutrition and beauty products are even increasing. Secondly, preventative health. Today, all the health care costs in the world is about curing. About 80% of the health care budgets are on curing. So it means basically we wait for the people to become ill and then we start thinking on how to cure them. That's a very silly way. If we would operate our company accordingly, we will be bankrupt in a minute. But we do that for health care, to be frank. Only 20% is spent on preventative. The good thing is we see things changing. Governments finding the deficit important. They want to find ways to reduce that. Health care insurance companies are looking more for preventative health care and that will switch to 50%-50%. So that's an enormous market growth from 20% to 50%. And just a small detail a bit of a shocking detail. I didn't know but Philip Eykerman told me that 80% of the health care costs are spent to people who are in the last 10 years of their life. That's scary, right? Luckily, we don't know exactly what the last 10 years of life will be but it's a scary thought. So it has to change and it will change. And we see changes upcoming. Thirdly, well-being. If we look at the world, if we look at the pace of change, people have sometimes lost, they look for a bit of self-reflection, a bit of self-care. And their well-being fragrance and beauty comes into play. And we definitely see that in the younger generation. I think the use of fragrance and beauty is considerably higher than the average of the population. So in this field, we play. In this field, well, we've chosen to be a category of one company in nutrition, health and beauty, all these macro trends work for us. In this world, where now the consumers want to compromise. We bring the essential, the desirable and the sustainable together. And there are only a few companies who can do that. There are companies who can bring the essential, the companies who can bring the desirable. There are companies who bring the sustainable. We are really unique in bringing essential, desirable and sustainable together, and this will shape the future. [Presentation]

I don't know about you. But you feel, what we're trying to achieve. I know we all like spreadsheets, we like facts. We like strategies. We like all of that. I love them too. But if you really ask what makes us different is this feeling in this audio fragment. It's not only me and I'm sometimes struggling even to. I've heard it many, many times, right? And it's still touches me. It still touches me. And that's exactly why I'm super proud to be CEO of a company like DSM-Firmenich. This is when I get out of bed for every day together with all 30,000 people of DSM-Firmenich. Let's go back to the fact. What we're trying to build is a category of one. And I already told you before, bringing 3 things together, what makes it pretty unique. You will find people in the space who can do essential, they can do desirable, they can do sustainable. You will not find many in this space who could bring these 3 together in the consumer space who don't want to compromise on this. And I explained the macro trends on nutrition, health and beauty. The macro trends will help us to shape that company for the future and it will be backed up by science and research. We will not be a fully fussy marketing company. We are a science-based company. It's not without reason that we have Sarah Reisinger, our Chief Science and Research Officer on stage after me because we are science base company. Post the separation of Animal Nutrition, what type of company are we? We're a company around the size of EUR 9 billion. We're a company with about 21,000 employees. We're a company with around 7% of R&D spend year after year. We're a company with an historic growth rate of that business of around 5%, which is a pretty good starting point. Remember, we still need to add the synergies and the innovation and the likes and an EBITDA quality margin of around 20%. That's a starting point of what we've chosen to play in. That's the starting point of where we are today. And then we took that business, and remember, we're now moving to the tune phase. So we took that business and say, "Hey, let's not look at this business from a 3 business unit perspective. But let's look 2 or 3 levels below. Let's subsegment those businesses. And you see here, all 3 business units with a subsegment. There are about 20, 25 of these sub-segments. And we've looked at what is the market growth linked to macro trends? What do we see? Coupled with what is the capability to add value from 2 lenses. One, what is the right to win and what is the capital efficiency? And then we've plotted these businesses. And we had a quick discussion just before we went into this presentation. Well, did you have a number in mind or whether you wanted to end up in all these categories? No, we just did the fact-based analysis. And you see here all these businesses being organized around 4 categories. And the categories do have a clear mandate on how we operate. So the accelerate category is driven by creation and innovation, obviously, but we'll have prioritized investments. And there are about 6 of these segments. We have the grow segment where we will have continued investments. They have proven to have good market growth. They have proven to have the right to win with an optimal capital efficiency. Then we have 2 businesses and the respective BU presidents will lead you through 2 segments where we say, "Hey, we need to improve to grow. So we improve on the cost effectiveness and we improve on the profitability before we decide to further grow. And the last category is the Deprioritize category. That category is in one ever shape or form, where we would like to capitalize on the value of these businesses, but will no longer be part of DSM-Firmenich. And there are a few businesses which will go with the ANH parameter. That will be the vitamin part, the non-differentiated vitamin part and the aroma ingredients. So they will go with the ANH scope going forward. And there are 3 businesses where we're going to review strategic optionality, how to best capitalize on the value, that will be the agro ingredients, yeast extracts and the marine lipids. In total, it will be above EUR 600 million and these businesses have, if you look at the analysis, has seen lower market growth, a little bit more capital needed and we basically feel that the company we would like to build will be without these businesses going forward. How we do that, we will review optionality. We have this business. ANH is carved out. We deprioritize these businesses and then we have the business we have chosen for. This business will quickly grow to above EUR 10 billion in size and we organized it according to 3 business units. And the 3 business units you know, they will also be on stage here. You will see the breakout sessions with Perfumery & Beauty with Taste, Texture and Health, and Health Nutrition & Care with the respective growth rates in the EBITDA margin. So these are not targets. These are directions, right? We'll come back to targets and commitments in a minute. And how are we going to grow what we have. So remember, ANH is carved out. We make the tuning with some of the deprioritized segments and what we have, we will grow. A lot of people will say, well, that's boring, just grow what we have. I find it extremely exciting. But we need to grow what we have. We need to show the potential of that business going forward. And how are we going to do that? We're going to anchor our unique business model. And I think I spoke to many of you before, also in the teach-in sessions and some of the Capital Markets Day a year ago. We have something unique. We have, on the one hand, a fantastic ingredient box. In France that sounds [Foreign Language]? I still need to work on the pronunciation Emmanuel, but I'm trying, right? In English, it's the ingredient toolbox. So if you had the right ingredient toolbox to play with, it's a great entry for success. However, we also need great creation and innovation capability, being very close to the customer and the consumer, right? So if you have a fantastic creation and innovation capability, but you don't have the right toolbox to play with, you will disappoint customers. However, if you have a fantastic ingredient toolbox, you really love with all the ingredients in your toolbox, but you don't have that creation and innovation capability, you fail. You need both. And you need both to communicate with each other. We call that via the brief and solution capability. So in fact, you need to have 3 unique capabilities and they need all to be tuned towards each other. That's a unique business model we have and that's why we generate the growth we have, and that's why we create the customer satisfaction we have. This is unique, and we're going to anchor that uniqueness. And this will be backed up by science and research, and it will be helped by sustainability as a business driver. Let's give me a few minutes of color on these 2 additional topics. So science and research, I need to be careful because after me is Sarah, and she knows far more about science and research than I do. But I do have a passion about science and research. And it starts with 3 platforms where we've decided to share the future. So this is not something where we share the future next quarter or next year, but it is something where we changed the world in 3, 5 or 10 years from now. And all these 3 platforms will be backed up by digital, data science and AI. And these 3 platforms are, first of all, Bioscience. Merging the 2 companies together, I think we are a unique set of components there. Secondly, it will be Microbiome. They've good health. Looking to live spine fatality, looking at health care. The Microbiome is an under-researched area. We only know part of what's really happening in our gut. It's pretty amazing but I'll leave that to Sarah. And then thirdly, equally important for the company we're building, the receptor and sensor technologies and competence we have are amazing, and we are ahead of the game. We have 400 receptors in our body. This is something where we really are pushing the boundaries. So these 3 platforms will help us to build the company in the future, not next year, but when we are back in this room in 5 years from now, you will understand why we selected these 3 because they really are going to change the world. And then sustainability. Sustainability is a business driver. So this unique business model backed up by science and research and helped by sustainability as a business driver because our customers and consumers are asking for it. And we don't even see it only as a business driver. We also take it at heart as a responsibility, a responsibility as a company. And I want to reemphasize that for us, even in today's world, where people question it, we feel it's a responsibility. And we do that around people and planet, and we call that people, planet progress. And we not only put that down in words, we will also put that down in commitments and targets. So let me start with people. On the people side, many of you did not ask the most important question you should ask me. And that's what's your engagement score of your employees because you can have a strategy, you can have your system, you can have a unique business model, but the people make the difference. And we measure that every year, and I'm super proud that we had an 80% engagement score when we tested it last January. In a year where we did integration, the vitamin transformation, where the macro circumstances were difficult, we had huge of change. The 30,000 employees, of which, I think 79% gave a response rate showed that they were engaged with an 80% score, which is in the top league. So it shows that apart from the story, we also have the people who are really behind that dream. Second part on people is responsible value chain. Responsible sourcing. We have a very strict supplier code of conduct. In our industry, that's absolutely key. We ordered our suppliers. We take action if there are deviations of the supplier code of conduct from safety, from human rights, from chat labor. And today, you've seen, for instance, on the Jasmin case, how important that is. We have a very strict supplier code of conduct and we take action when needed. That's part also of the people part. Then the planet part, we did a lot of work where we are committed to reduce Scope 1, Scope 2, Scope 3, renewable energy. And we also submitted that for validation to the SBTi. So it's not only our numbers, our reporting, it's also external validation. So what you see here is our strong commitment also to externally validate what we report. So we don't report a cigar from our own box. We asked external validation to the numbers we present. That's also how we take sustainability as a responsibility. So we talked about people, talked about planet, talked about profit, talked about progress. How does that translate into our midterm objectives. But you can see it here, you see people, planet, profit really being represented, and Ralf will lead you through a bit more in detail later on stage at this presentation. Let me wrap up. We are on a journey, a fantastic journey, a big dream, as dream big. We started that dream a couple of years ago. It resulted in the merge last year here, only a year -- 1 year and a month ago. That was emerged in difficult market circumstances. We started the vitamin transformation project and we're going to execute that. We're on track and we're going to execute that. We accelerated our synergy and integration project and we will execute that for the fullest. Then we move to focus. We started the separation of Animal Nutrition and Health and will drive that to sign to close in 2025. We have reviewed our portfolio. We've tuned our portfolio, we'll deprioritize some of the businesses and then what we have selected to be a consumer-focused company, will grow what we have. We will show you the potential of that business. We grow what we have. We will anchor what we do with our business model, and we will deliver, deliver on the promises made, deliver on the dream to bring progress to life. Thank you...

Science is everywhere. Science touches each and everyone of yours life every day. And a DSM-Firmenich, we harness the power of science to deliver new solutions to make people lives better and to turn those dreams into reality. No, I'm really happy to have the opportunity to talk to you about our Science and Research capabilities at DSM-Firmenich and how it's accelerating our future growth. Now DSM-Firmenich has an astounding track record of innovation with more than 150 years of scientific discovery from one of our early scientific directors earning the Nobel Prize in chemistry for his work on musk, which is a key class of perfumery ingredients to pioneering delivery systems and groundbreaking biotech ingredients. This scientific excellence is what serves as our foundation upon which we are building the future of DSM-Firmenich. We are an innovation powerhouse in health, nutrition and beauty. Each of our business units is driven by deep science. And we use science research capabilities across the business units to accelerate their growth. Now I'm going to talk to you a little bit about recent innovations in each of the businesses with the business presidents talking much more later today. Products we lost, but healthier, more delicious and better for the planet. This is what taste, texture and health is all of that. Bringing together the passion that we have for food. I think we all have that, a passion for food, but also that expertise and science, bringing it together to develop solutions that we need. In 2023 alone, we had 39 global launches for TTH of innovation. I'm now going to talk to you about 2 different key markets where we have developed solutions for consumers. The first one is all about sugar reduction because let's face it. Sugar is awesome. It's versatile, it's cost-effective. And I know I love it. Sorry about the mic. I know I love it, I probably all of you love it to. I'm willing to bet. But you know what, often, many of us love it too much. I know I have that problem. And when you love it too much, it actually this overconsumption can cause severe health problem. The difficulty and the challenge the TTH is working on at DSM-Firmenich is, how do we deliver the exact solutions in foods that you know and love, but healthier, reducing that sugar. And luckily, we are the experts of science of sweet. For more than 25 years, we've been studying the sweet receptor, and we are the world's experts. So we took that knowledge to address key challenges in the market. One of this is delivering carbonated beverages, sweet carbonated beverages that are reduced in sugar. Now what you might not know is when you're drinking a sweet carbonated beverage, what drives your liking of it is actually that carbonation. And when you reduce the sugar, your perception of that carbonation changes, and it's a big, difficult challenge. So we studied that interplay with the carbon dioxide, that mouth filled that you get and sweetness and then developed a solution that delivers what consumers want. We're able to amplify the flavor in a reduced sugar format, increasing perception of carbon dioxide as well as masking any of the off taste or lingering that you may associate with sweeteners. This product, our customers are loving when we talk to them about it and consumers as well. It's called taste carbonation in case you want to go check it out. The second one I want to talk to you about is a plant-based alternatives. This is allowing for sustainability and healthier solutions for all of us as well as good for the planet. And our consumer insights team found that 1 in 5 European consumers like and drink, consume regularly plant-based beverages, 1 in 5 but that number can change to 4 and 5, more than 80% if it would taste more like [indiscernible]. So we being the experts that we are. I understand that there's 2 really big components on likability, and that is about mouthfeel and about flavor. So we've developed our best-in-class milk solution that addresses these 2 attributes. The first in mouthfeel, we developed Dynarome DA technology, which is encapsulating a vegetable fat, so that you have an experience more like that of dairy in your beverage. The second is optimizing for flavors that addresses some of the off notes and off taste of aromas you see in plant-based food. This best-in-class milk has one in consumer test. Well, our customers love it and you're going to have the opportunity to test it in the experience room later today. So hopefully, I'll hear some great feedback from you as well. I'll check. Now Dimitri talked about the paradigm shift that's happening in health care today with a move from curative to preventative health, this is something that Health, Nutrition & Care is really focused on preventative health solutions that nourish and protect you through your entire life's journey. First, let's talk about Omega 3 supplementation during pregnancy. Now 1 in 10 babies worldwide is born preterm and clinical studies have shown, you can reduce that by 40% of early preterm birth by supplementation with omega-3s. But compliance is low. And that's where we've come in with innovative solutions. Using biotechnology, we've developed an algo-based DHA EPA omega-3 that has the same ratio of those omega-3s that you get from fish without the filthy taste. And then we went beyond that to work on new formulations such as gummies so that you can have even better compliance. And the United states alone compliance would allow for 40,000 fewer preterm birth and health care savings of almost $7 billion annually. This is a huge impact. You can also taste that in the room related to this. And then another thing that Dimitri talks about is gut health. A lot of us are hearing so much about microbiome and gut health and at DSM-Firmenich, we're developing a portfolio of Biotics to address this important need. Today, I want to talk to you a bit about the Humiome line that we've developed and specifically Humiome B2, which is a vitamin B2 delivery system. Now normally, when you take a supplement of a normal pill, only 2% of the vitamin B2 actually gets to your colon where it needs to feed and nourish 2% with our patented microbiome targeting technology, 90% of that B2 is going to be delivered -- is delivered to your colon, where it's going to nourish your microbiome and help you to have a healthier gut. So from 2% to 90%. This is a huge lot of impact to help really feed and nourish your body. Going from feeling good to feeling great via the power of scent and beauty. That's what Perfumery and Beauty is all about. It's beyond emotion, elevating how you feel. Now the first innovation, you get say you're probably paying attention to innovations to talk to you about for Perfumery and Beauty. And the first one is in skin care, our latest skincare innovation. Now I would probably think that almost all of you would love to have younger and healthier looking skin. I know I use many of the team's products. And this is what our latest innovation address. So Eterwell Youth selectively target senescent cells, zombie cells and zombie cells actually give premature aging to your skin. Eterwell use eliminates these zombie cells resulting in an increase in collagen in your skin, boosting and helping you to look younger and healthier and recently, just earlier this year, won the Gold Award at in-cosmetics held here in Paris, and we're very excited about this product as well as the innovation portfolio using this senescent science. Moving to Perfumery and Fragrance. What's really important is delivering a key moment for consumers. And 2 out of 3 consumers say they wish there scent last longer. But I would argue that it's actually almost 3 out of 3. And that's because scent is beyond the fragrance that you noticed, but it actually signals that you smell that you signal that it's fresh, it's clean, it's safe. And we have a portfolio of different types of technology that can deliver long-lasting fragrance. And today, I want to highlight HaloScent because you're going to get to smell and experience it later today. So our HaloScent portfolio is a portfolio of pro-fragrances. And a pro-fragrance is a fragrance ingredient that's actually chemically linked to another molecule that could be another fragrance ingredient or an inert molecule and so initially in the formulation, you don't smell that fragrance ingredient. But then upon a trigger that fragrance was released at key moments that the consumer wants. We have developed triggers for the release in air triggered by oxygen and water and even enzymes from your microbiome on your skin. We have a portfolio of 7 pro-fragrances, HaloScent fragrances, and we're continuing to invest in this portfolio. Now all of the innovations today are customers we're getting great traction with. And we also continue to invest on our really excited about our continued portfolio. And I want to tell you about what are some of the key attributes of our team and our capabilities that are putting together the innovation of the future. I know many of you like numbers, right? So let's give you some numbers. We have more than 2,000 employees working throughout our innovation community focused on delivering groundbreaking innovation to grow our business. We're backed by more than 16,000 patents protecting our innovation. With 200 new patents with it's the first patent in a new family in 20 -- in our first year at DSM-Firmenich alone. We also were recognized as one of the 100 most innovative companies in the world by Lexus Nexus this year. We have a global footprint of innovation, and we invest more than EUR 700 million annually. Now again, you probably want to say EUR 700 million. What are you spending that on? All right. So I'll tell you a bit about that as well. What are we spending on? We're spending it on an unparalleled breadth and depth of innovation capabilities. We have mature technologies that serve as our foundational technologies that are incredibly essential for fueling our business growth. And then you already heard a preview from Dimitri so you can check how we both talk about it but some of them were fast evolving technologies, what we believe are really going to differentiate and grow in the future. So I'm going to go a bit more in depth into each of these fast evolving capabilities to help you understand how we view it, how we're unique and how we're using this technology across our BUs with to drive and accelerate growth. At DSM-Firmenich, we view biotechnology as a transformational science for a sustainable future. And we are fully end-to-end from early-stage discovery all the way to industrial scale production. And what makes that end-to-end unique for us is the fact that we are able to work super closely with our perfumers, our flavorist, our nutritionists and our customers from that early stage so that as we codesign and we ensure we're going to develop new differentiated ingredients that the perfumers love and want to use and that help our creation stand out even more. This is truly a unique way of working that helps us go further and have more impact. We also have an incredibly diverse portfolio of micro platforms, allowing us to make many different types of molecule enzymes proteins. And all of this together helps us have an unparalleled time to market. Now I want to share with you a bit about one example here of how we're leveraging it across the businesses. So terpenes are a key class of secondary metabolites made in plants. There's actually more than 50,000 different terpenes already known to be found in nature. And we have built a biotech platform of terpenes, which we've leveraged across 3 of the business units, making fragrance ingredients for Perfumery and Beauty. Differentiated natural sweeteners for TTH as well as sustainably produced vitamins for agency. Now Dimitri spoke a bit about the microbiome and I also talked a little bit about it. And the idea is that the microbiome goes well beyond gut health and your feeling of well-being. And as Dimitri also mentioned, it's a new science, maybe 10 years ago, you haven't heard about it, but now you know that it's really impactful, but we're still learning about how it impacts our well-being, both mentally, physically and all aspects of our life. But what that means is it's a huge opportunity because if we can learn how to harness the power of the microbiome and modulate it, we have a potential to have a huge impact on human health and well-being. At DSM-Firmenich, we take a unique approach where we take a transversal look at using it across your different microbiomes. So many of you know about the microbiomes in your gut. But you also have one on your skin and your oral cavity in your lungs, actually, in basically everywhere in your body. And they're all unique, but the same tools and the learnings can be used across them. We also have a huge proprietary library of naturals that we've screened for bioactive properties for having an impact on health benefits. And we're using synergistically using Pre, Pro and postbiotics together against diverse microbes but also in different applications, allowing for solutions across our BUs accelerating the solutions to customers. Chemosensory receptors are essential for the human experience of taste and smell. If you didn't have them, you wouldn't be able to taste or smell and recent studies have now shown that those same receptors actually have are essential for other key physiological experiences in human processes. Now at DSM-Firmenich, we are world leaders in olfactive and taste receptor research with decades of experience and understanding your taste in olfactive receptors. From the moment a receptor is bound by a molecule all the way to the emotional response or health triggering event. We have proprietary patented hydro screening platform as well as a huge treasure trove of data that allows us to have unique insights as well as to discover novel new ingredients. Now we leverage this again across multiple businesses. We're using our knowledge of olfactive receptors. We are able to develop antagonist, which make it so they block the smelling of a malodour so that your laundry is in the image shows smells fresh or your deodorant also keeps you fresh without selling that malodour. We use the same technology for taste receptors to block bitterness in functional foods and beverages. And as I said, because chemosensory receptors have gone beyond, we can target those same ones in the gut to have a profound health impact. And then, of course, data science and AI. AI is changing the world. I think I have to say that again, although you've probably heard it everywhere in the newspaper or on your phone. But AI is changing the world. There's no question about it. But what it's also doing is changing at DSM-Firmenich how we innovate but also the types of innovation that we can deliver. And as you probably hear a lot about AI, data is power. And we have more than a century's worth of data, and this is a huge competitive advantage for us. And we are leveraging that to create tools to turbocharge our discovery engine as well as for developing tools for creation and augmenting it. We have implemented data science and AI in every aspect of how we do innovation to ensure we're doing it faster and able to discover new insights. And here, we talk about how we're using AI and machine learning throughout our business, where we've developed tools to help increase the speed of creation to support our perfumers and also to inspire them into new areas of creation. We're using similar technology in TTH to actually co-create with our customers using our Delvo ONE technology platform to come up with a new combination of dairy cultures for yogurt and other fermented products, dairy products. And then we're even using it to identify what are the key factors in healthy aging. Now all of these emerging technologies are really important to our growth of our business. And I think I've given you a bit of an understanding of how we are unique at DSM-Firmenich. But there's another thing that makes us unique, and that's just as important and it's the power of synergy. Bringing together different science capabilities into a single project, putting together, that synergy allows you to go faster and further. Here, I give you an example of a new ingredient discovery. Where we are leveraging data science and AI to identify different structural spaces, where without that, you might be used to just what you see in nature and limit your search. We're using combinatorial biosynthesis to increase a structural diversity further and then receptor biology to screen those hits and then testing them in creation and applications. This combined approach allows us to come up with new differentiated solutions, we would never have come up with alone. Allowing us to grow our business and develop better solutions for the business and for consumers and customers. But let's be honest. We at DSM-Firmenich cannot do everything ourselves. And typically, we shouldn't. And that's why we really take an ecosystem approach to innovation because we can go further and have more impact together. We have more than 100 collaborations with start-ups, academics, other companies and nonprofits. We also have a corporate VC team that has a portfolio of more than 40 companies, which allows us to have deep insights and get an early look at emerging new technologies. And together, this overall view allows us to move faster, further. Now science is everywhere in our world. And I hope after hearing me talk for a few minutes, you understand how science is everywhere at DSM-Firmenich. Our science capabilities are helping us to push the boundaries of what is possible. And we're going to continue investing in these capabilities and in new ones to help accelerate a future of fulfilled drains, where you don't have to choose between what tastes and feels good to you versus what's good for you and the planet. Where well-being comes together with sensorial delight to increase your own personal self-confidence. And where every member of the world population can maximize their own health span, allowing for the highest experience of well-being. Thank you so much for letting me tell you a little bit of science and research at DSM-Firmenich. And now I'd like to introduce my friend and colleague, Emmanuel to talk a bit more about.

It's good to have this with me. Thank you, Sarah. Exciting time. And it's always a pleasure, by the way, to work every day with Sarah, the passion of science connected with our customers. It's always a great time. So let's move a little bit in the world of Perfumery and Beauty. And in fact, I would start my -- this little presentation with, by seeing that how great it is to work for the Perfumery business, okay. With this passion with also the complexity and the mystery of what the creation is doing every day. And you will have the chance to see some of the Perfumers. I see [ Nathalie ] in the background and [ Florian and Flora ]. And I think -- this mystery is what we're living every day. It's a very, very, very special time. Now we are very lucky because basically, this is also a business where we are growing and supported by, I would say, significant macro trends. So on diversity and digital humanity, you have to remember that millennials and Gen Z as they grow a lot. The wealth grew very much by more than 80% over the last years. And I think beauty and fragrance is considered as the key element to express the personality and the identity of those people. The numbers of search on Perfume on TikTok over the last years and just after COVID has more than doubled. And in fact, for this kind of generation, the consumption of beauty and fragrance product is one of the highest of any generation. And from that standpoint, it supports very much this trend. Second, 1/3 of consumers in the world are looking for superior products, superiority, premium product and experience across categories and high-quality fragrance and also beauty care product backed up by solid science rank at the top of the reason why consumers are willing to pay a premium. Third, in fact, as you may remember, a couple of years ago, after the COVID dip, we had experience I would say, diminishing, I would say, sensation to our body to our mind. And in fact, we know awakening our sense with 83% of the consumers of the globe look for experience for instant happiness. And we can see that many products from FMCG are going in that direction. Fragrance is so critical and in providing this immediate delight and happiness. So those 3 macro trends is just showing that fundamentally, we are very well. We have a good foundation for growth moving forward, and that's why we're enjoying this growth in this very good business. Now let's move to another chapter of, I would say, 2 years after the [indiscernible] visit, not far away from here, 1 year after -- 1 year and 1 month after the merger. We are moving into, I would say, we make progress to life. But what means progress to life for Perfumery and Beauty. So I would like you to listen to the short video. [Presentation]

How motivating it is to work for a business with such an ambition. And we need, in fact, and deserve this little and big moments, where we feel great emotionally and physically the body and the mine. And that's why we are bringing delight and care together as one and to go beyond well-being. So try to live in this world of Beyond well-being. Now one of the key questions is how we will embark our consumers and customers across the world on this journey. In fact, by creating those moments, elevated moment of care by enhancing product which are essential for us every day. From turning household shores in moments of well-being to making fragrance to make us feel better and to promoting healthy hygiene habits for by fighting [indiscernible]. We deliver superior consumer delight by making the product experience more desirable, we drive brand preference and usage. Last, and very important, we bring positive impact through sustainable choice in creation, innovation and operation. And by sharing with our customers and being the partners in co-creation, with this vision, we will continue to enhance the great customer intimacy we have, and we will continue that journey moving forward. As I mentioned before, we are lucky to be part of this industry where we, at the end, will combine the essential, the desirable, and the sustainable, and come together to not make the people feel good but feel great. Now having a vision is a good thing. But also, what is very important that we translate this vision into strategy, into the road map. And let's start by being who we are. So we start from a nonviral portfolio, covering the entire market space into 3 different businesses. The first business -- the business line Perfumery where we are the leading partner of our customers in 5 fragrance and consumer brands, which represent around 60% of our business. Then our Ingredient business providing the broadest back integrated portfolio of the industry, but also the backbone of our Perfumery, representing 25% plus of our total business. Then Beauty & Care, leading in sun care and showcasing in differentiated skin care active products. These 3 business lines are built on the foundation on science, on people, but also on sustainability. We worked so hard over the last 12 months to put those 3 businesses together in a unique ecosystem with each business line with a dedicated go-to-market with a strong legacy and history of success, but also connecting all together via shared innovation global operation, but also a common culture of excellence. Then what an incredible journey we had over the last years, over the last 12 months, an incredible journey, an incredible amount of work, where the merger did not only offer us the opportunity to put a portfolio together. But to think differently to, I would say, built a new business unit together to organize ourselves in a new way, but also to transform. And that's what we did over the last months. we transform ourselves by maintaining also an imperative, I would say, dimension of perform. And in terms of performance, this is what we have done. Position amongst the largest perfumery and beauty players in the world with EUR 3.7 billion business. And we come with a 3-year period with a growth of 6% organic sales growth for the last 3 years. In the past 12 months, the team have focused very strong effort on improving profitability, delivering from below 20% EBITDA to above 20% EBITDA. And we expect to, I would say, stabilize at 22% EBITDA and growing, as a next step to 22% to 24% EBITDA. But we also transform ourselves. And we also wanted to build a stronger foundation for the future. First, we put the 5,500 people together in a project which was called symbolic convergence. Convergence is immense effort and use and huge activities to align and build a new foundation for the future. We have enpowered I would say, our leaders, our P&L owners with more autonomy with more accountability, make sure also that we can have people being empowered at a local level with more agility. We have further accelerated innovation, enable and with our strong science foundation. We also delivered synergies, and we are very happy with that, and I will come in a minute later on that. We also started to create a culture of excellence with a few programs, all enabled by AI and by digital. And I wanted to take advantage. In fact, of this meeting today to thank all the leaders, but all the team, which, over the last 12 months, have been able to perform and transform at the same time, in the context of, as you know, merging the 2 companies together. Now let's, in fact, also try to see what will be our focus moving forward in terms of priority and growth around the business line. You will not be surprised that the perfumery business line will continue and accelerate based on our strong foundation in fan Fragrance and Consumer Brands. No surprise also that you will see also the Sun Care, the Skin Care, the Beauty & Care activity which will accelerate and expand the portfolio. And also, last, on ingredients, we will continue to focus the right balance between profitability and growth, which I would say it is what we have done over the last 12 months and will continue to do moving forward. If you look at the portfolio because Dimitri has shown the entire picture of the portfolio. Then let's have a look of the picture of the portfolio within Perfumery and Beauty. First of all, on the pink bubble here on the Perfumery business line. We'll continue to focus on global consumer brands with added value innovation for Home, Essence & Beauty. Then we will also accelerate our regional business, which with a tailored value solution, and we will activate and accelerate very strongly this activity, while we will also sustain the momentum on Fine Fragrance by continuing to set the effective trend and with our team of talented perfumers. Secondly, on the blue bubble, the Beauty & Care. We will continue the momentum on Sun Care based on our current leading position and portfolio. We will accelerate skincare but also, we will expand in scalp and hair care. Then we look at the portfolio of ingredients, which you can see are represented here in all the different green bubbles. Let's start maybe with Pinova. As you know, we announced almost a year ago the closure of Pinova which at the end will come at the end of the process in July 2023. We also would like to continue the improvement that we've made in the industry business, in the industry ingredients, which have increased significantly profitability versus growth in terms of revenue. and we will continue to improve to grow. But also, we will, as Dimitri was showing before, we will really try to, I would say, deprioritize, I would say, 2 activities First of all, the Agro & Hygiene ingredients, which represent around EUR 40 million of revenue, as we said. And also, we will look at the strategic option in the context of the ANH separation to find strategic options for the aroma ingredients. So this is what we want to do from an ingredient perspective, and we believe that very strongly that after this transformation of our ingredients, we will have, I would say, a fantastic, I would say, ingredient business, focus on fragrancing regions and focus on renewables and really ready to be the backbone of the perfumery business moving forward. After the portfolio, let's go back to, at the end of the day, who we are, how do we differentiate ourselves? And I would like to start by showing really what is our leadership coming from? What is Our heart and I would say, [ Our ] is our inspiration. We have a unique business ecosystem. The EUR 3.7 billion combining the Perfumery business line, Beauty & Care and Ingredients. And in fact, we have 2 very strong connection between Perfumery and Ingredients. And we also have a very strong connection between Perfumery and Beauty Care, which, by the way, is generating significant synergies. Our heart, it's about creativity, it's about the incredible population of our perfumers. It's with their heart, with their brain, with their knowledge that we have. The innovation is really what, in fact, is what Sarah was describing before is really the combination of creativity and innovation is really making a difference in the marketplace. And last, also, our inspiration about the consumers and customers, knowing that we have a unique knowledge in the consumer in the consumer knowledge and the consumer insight to understand the trend, to understand for each of the market segments where we are and, in fact, to support the creativity, the innovation, which enable us to keep our leadership moving forward. Now let me try to go into, I would say, the description of our leadership. We spoke about a unique ecosystem and the connection between Perfumery and Ingredients. We win today because we are the most vertically integrated backbone and the broadest portfolio with unique technology and innovation across natural synthetic and biotechnology. This allows us to provide the best ingredients to our perfumer, particularly our renown captives, but also the biggest renewable portfolio. At the end of the day, it allows us to be simply the leader in the fragrance ingredient market. We believe that this unique connection will be an even more critical advantage in the future. as our capability in biotech, green chemistry and sustainable natural extraction positioned well, very well to anticipate what the regulatory constraint will come, but also to anticipate what is the upcoming sustainability agenda of the company. And we will discover that. We will have [ Amuri ] and [ Matthew ], which will later on showed that in the breakout session. The second very critical connection between Perfumery and Beauty and sorry, of Perfumery and the Beauty & Care. It's about, I would say, the fact that we have a unique portfolio, a very big sizable business in the Beauty & Care with Skin Care where we are experts in translating scientific findings into tangible consumer benefit with more than 40 years of expertise in skin biology. Also, Sun care, on the top of the broadest portfolio of UV filter, we have state of heart formulation. In Scalp Care, we have a current portfolio, which will be accelerated in terms of growth momentum. And in Air-care, we want to expand, I would say, the Air-care activity to, I would say, at the end of the day, creates the synergy with the perfumery business. We said that before that we have a great momentum on synergies, and we combined highly differentiated product and target Prestige brand with ingredients with broad penetration across market segments. We fully utilized the customer channel of Perfumery to accelerate sales momentum, supported by a pipeline of 30-plus new [indiscernible], which has been deployed over the last 12 months. And I'm very happy today to share with you that the results have just been great to combine the 2 together. And our revenue synergy will be done ahead of time, and we will be able to accomplish them in 2025. And my [indiscernible] colleague, my dear [indiscernible] and the entire team will show us the fantastic world of the Beauty & Care. So after the leadership, connecting the 2, let's move to the art, to our heart. For sure, when we start with the heart we are starting with the community of perfumers. And you can see here the 110 perfumers, it was an event that we had a year, almost a year ago, just after the merger, where we had a fantastic 3 days in Berlin. In fact, basically, this 110 perfumer, multi-generation highly talented. And have in mind that someone like [ Natalie ] in the room has more than 25 years or more, I don't want to say more, [ Natalie ], to be able to, I would say, represent this community of consumers. And these 3 make a difference, but also they are enabled and augmented by science and data, as Sarah was mentioning before. Let's move to our innovation absolutely today with all the research capabilities that Sarah has just shown before. those capabilities feed 3 innovation platform which together bring to life at the end our vision, providing added value for customers and consumers. So on ingredients, we invest to discover new ingredient and fragrance captive, delivering customer delight but also care. We have Dreamwood, will show Dreamwood a bit later, which not only smell good, but also has a proven skin benefit. On technology, we are a leader in fragrance delivery system. We have a broad portfolio of technology with encapsulation, with chemistry which are satisfying also the LCA requirements of biodegradability with no promise for consumers. Fragrance design is also where we combine innovation and creativity, leveraging preparatory scientific knowledge, we can give really to perfumers guidance on how to design the fragrance for specific benefits like the so important greater tail that you will see a bit later in the breakout. Just before we go to conclusion, we have for sure our commitment on the positive impact on sustainability. And for that, we want to be extremely focused and precise on, I would say, 4 priorities. The first one is on the level of transparency and accuracy we provide on sustainability measures. Our proprietary tool, [ Ecostay compacts ] allow us to see in real time the sustainability impact of adding 1 material over another in a specific formulation. Overall, we want to achieve 100% LCA and sustainability data by 2025 for all our ingredients. So first of all, transparency. Second about secular ingredients, whether biotech upcycled or biodegradable and we aim to have 90% of our portfolio biodegradable by 2030. Third, we also want to leverage cabin capture and compaction meaning fragrance that achieved great performance with a lower content dosage of ingredient. And all of these initiatives will enable us to further reduced by 25%, the carbon impact by 2030, and we aim to -- I would say, to be at net 0 by 2045. Finally, we shape full responsible value chain, and we are able to anticipate future reporting requirements and the expectation is to have 100% of our ingredients fully responsible resource by 2030. Last and in short, we are global perfumery and beauty leaders with a unique ecosystem combining perfumery ingredient and Beauty & Care together connected through innovation, operation and excellence. We will grow and accelerate in Perfumery, based on our backbone based on our strength in Fine Fragrance and Consumer brands with different approach by segment. We will accelerate in Beauty & Care, by continuing the great momentum we had over the last years in skin care, but also expand in air-care while capturing our synergy with innovation and joint concepts. We will secure our profitability and growth in ingredients and continue to be the backbone of our perfumery. In short, we have been performing and transforming over the last months we'll continue to deliver this sustainable growth, building on major progress being done. We aim to grow at 5% to 6% organic growth over the next years leveraging our focused choice in Perfumery, Ingredient and Beauty & Care and the synergy also in between. On EBITDA, we will first consolidate at 22% EBITDA margin and aim at reaching 22%, 24% on midterm by capturing the full potential of a new organization, further acceleration on innovation data and AI transformation, focusing a relentless on excellence, but also adjusting the portfolio. By that, I would like to thank you and all together at Perfumery and Beauty. Let's go Beyond well-being uniting delight and care for positive impact. Thank you very much.

Good, what a discipline. You see the impact on the financial communities bigger than on my CEO, and we needed to get into the room. Good to see you all back for the second part of the program. We're going to kick it off with HNC. So Philip?

Hey, warm welcome also from my side, I think the mic is working now. Thank you very much. Really excited to present to you today the Health, Nutrition & Care or HNC business and also to welcome you later on during the breakout in the experience [ room ] And if there is 1 term that nicely summarizes what we stand for in health mutation and care, it is preventative health. And preventative health is important now more than ever. and that is because there remains an important gap between healthspan and lifespan of typically 10 years. And if you know that 80% of a person's health care costs throughout his life, his or her life, are spend in that last 10 years of life, and you combine that with the fact that the population is aging and people above 65 years old are going to double, towards 2050, this becomes clearly unsustainable. And governments have understood that in North America, in China, in Singapore, for instance, and are taking measures to make people more aware about the importance of preventative health, and the good news is also that COVID has people, has made people more aware of the need for self-care and consumers are looking for enjoyable, sustainable and science-backed solutions. Another element that I think is supporting our business is that we see new customers entering the space. Many large ones like Nestle and Unilever, for instance, but also many, many smaller ones, often very, very regional, as barriers to entry our industry, I mean in terms of becoming new customers have never been that low. So all 4 elements clearly support our Health, Nutrition & Care business. And so what we aspire to do is to keep the world's growing population healthy together with our customers by providing preventative health in enjoyable and sustainable science-backed solutions that are not only better for people, but also better for the planet and we have a short video to illustrate that. [Presentation]

We bring that progress to life through 7 segments, covering the entire lifespan of the consumer, starting with early life nutrition for pregnant women for infants and for toddlers, over dietary supplements for active adolescence, active adults, two, medical nutrition, blends and pharma active ingredients for people that have a particular health state or health need; two, nutritional improvement solutions that we provide for the undernourished in low and middle income parts of the world. Those 5 segments cover our health nutritional ingredients, B2B segments. Next to that, we have our own specialized B2C business called i-Health, that is very much focused on health from the Gut and Women's health. And of course, we have our Biomedical materials business, very much focused on mobility and on cardiovascular solutions. If you look at the first 5 segments, that totals roughly EUR 1.7 billion in sales. And within that part of the business, we're roughly 3x bigger than our next competitors. Next competitors that are typically focused on just ingredients or Blending or on CDMO type of activities for Nutritionals. Now it's not so much the size that sets us apart, although it's not unimportant. I think what really sets us apart is the business model consisting of the 3 pillars. The first 1 is the ingredient toolbox. We've got the largest ingredient toolbox in the industry, own produced ingredients, but more importantly, with our own scientific evidence associated to each of those ingredients. Now ingredients alone is not enough. I think Dimitri mentioned it, there needs to be more. One needs to be able to combine those ingredients in or with the products from the customers and by doing so, coming up with unique health claims. First thing. Second thing is 1 needs to fit in the application of the customer and the number of applications is rapidly expanding from traditional capsules and pills, into gummies, into soft juice, into stick packs, into gels, into shots, et cetera. I mean, consumers have become extremely picky on what they want to take. And so we're putting our products into special forms to make that to make that possible. Last but not least, thanks to the merger and the integration we've got today also access to fantastic masking and flavors technology that makes it also taste well. All of that, we do in the co-creation engine together with our customers. If you want to do that, you have to be close to your customers and you have to be close to the regulatory authorities in all the regions where the customers are active, and we are right? So I think if you want to be successful in this business, you need to have each of these pillars, app scale and they need to work seamlessly together and they do. Now before I'm going to go more in depth into each of the pillars and what we're doing there, I'm going to talk about the results of 2023. Over the last 10 years, this business has more than proven that it can grow at a stable roughly 4%, 5% year-on-year and do so at a margin of roughly 22%. That hasn't been the case in 2023 for a number of exceptional circumstances. Firstly, related to the ones in the lifetime spike in immunity improving ingredients during COVID. We've seen the unwinding of that in 2023. That, of course, has had quite an impact on our volumes, and that has been 1 of the 3 elements. Second element has been along destocking with our early life nutrition customers, primarily because of the [ Abbott ] issue and the [ Abbott ] plant closure in 2022. Thirdly, an exceptional spike in the energy costs and the raw material cost that is luckily unwinding already at this moment in time, needs to work its way to the stocks, but so that will definitely disappear. So these 3 elements have basically created a drop in the margin in 2023 that we are working our way through to bring the margin back up to 22%, 23%. And the way we're going to do that is by basically capturing the benefits of the vitamin transformation program that has a focus on cost, but also a focus on volume; secondly, capturing the synergies. Thirdly, fine-tuning the portfolio and fourthly, accelerating our growth or accelerating the sales based on innovation-led growth. So let me talk to you briefly to what we mean by tuning the portfolio in HNC. Just like the other businesses, we've done a very careful review of all our segments in terms of our right to win, but also in terms of the market development. You see 2 businesses here in the Accelerate segment. i-Health and Biomedical. Those 2 businesses have shown very consistent profitable growth and also provide very, very good returns on capital. So we're going to continue to accelerate their growth. Then in the growth segment, we've got the pharma and the Early Life Nutrition segment, where we're going to continue to invest to also there continue the growth. The one segment that we need to improve and basically bring it up also to the growth segment is the Dietary Supplement segment. And we're doing a number of things there. The first thing is that we're going to leverage the ANH carve-out to reduce our dependency on the non-differentiated base vitamins. And we have already started doing that by basically shutting down the vitamin C factory in China last year and eventually divesting it earlier this year. The other thing we're going to do is we're going to look into our Marine Lipids business. That is a relatively volatile business that also is quite capital intensive. And so we're looking into options in order to address that. Next to that, as I said, we're going to read the benefits from the vitamin transformation program. That is going to benefit not only Dietary Supplements, but of course, also pharma and Early Life Nutrition, and we're going to further invest in our blending capabilities and in renovating the portfolio. Over to renovating the portfolio. So the first pillar, the 2 box of ingredients. What are we doing there? Basically, 3 things. The first one is expanding the health benefits that we focused on. Traditionally, we've been quite focused on immunity improving ingredients. We're expanding that with a particular focus, as Sarah also referred to own Gut health or as we call it, Health from the Gut because it improves brain health. It improves metabolic health. It improves mental health, it improves a lot of different types of health states. What we're doing there, and you will see it in the experience room. We have nowadays in the portfolio, Pre-/ Pro- and Postbiotics and the latest innovation we've launched a few weeks ago is basically a Biotic Vitamin, and we're the first one in bringing that to market. So as Sarah said, it's a vitamin that doesn't get absorbed in the gut or in the small intestine, but goes all the way to the colon. The second lever to renovate the portfolio is increasing the differentiation. And that is where we particularly focused, I would say, on healthy aging because typically as one ages, the body absorbs less well, different type of nutrients. And so what we're now doing is we're renovating amongst other the vitamins portfolio to make them more bioavailable. And you'll see here today, [ MPD ], but we'll come up with an [ MPC ] and many other products to play nicely into the healthy aging space. And the last thing we're doing is making the portfolio more sustainable. And we are, for instance, shifting from Marine Lipids, shifting the entire industry and creating a new category, I would say. So shifting the industry away from Marine Lipids into or lipids. So that is what we're doing on the ingredients portfolio. As I said, ingredients by themselves are not enough. We need to be able to work with the customer to bring them together so that the customer can put a unique claim on pack. You need to make that combination work in the application of the customer and it needs to taste well. And that is what we're doing. And we're doing that these days in a very proactive way, right? So looking at the customers' portfolio and thinking through with the customers but proactively coming up with IDs on how we could improve the attractiveness of his or her product line. We sometimes go that purple boxing. Why do we call it like that? We cannot black box our solutions, right? Because in the end, the ingredients are on the pack, right? And someone could replicate that mix of ingredients. If we do it well, if we do it in a differentiated way, in a particular phone so that it better fits the application of the customer and it tastes better than any other competitor can do it. That is what can really differentiate us and make the business much more sticky than it has ever been before. These are some examples. And you'll find them and you'll be able to try them out in the experience room. I think the first one is maybe one of the most challenging things to do. Our customers have told us because it's a product that is good for cognitive performance. And it's a combination of an Algal Lipid with a vitamin B12 by the way the Algal Lipid it's tastes fishy. The B12 is very bitter and the Ginkgo Biloba, that is the [ Virtiva Plus ] is also very, very better, right? So that's the sort of things. That's the sort of challenges we try to crack for our customers. As you can imagine, this is the area where we will see most of the synergies in HNC. We have signed up for 125 million of synergies, and we currently stand at a pipeline of roughly 60 million. So making good progress, making good progress here. Last but not least, as I said, if you want to do that sort of work, you have to be very, very close to your customer, and we are. On the left-hand side, you see the breakdown of our sales. We're a bit over-indexed on North America, which is not a bad thing these days, by the way, but that is entirely due to biomedical and i-Health, right? If you take out biomedical and i-Health is roughly [ 30%, 30%, 30% ] and what is even more important is the 30% that we are -- 30% of our sales in developing regions because that gives us a nice footprint for capturing the growth that there will be in those regions going forward, I would say, especially in Early Life Nutrition, but also in the other segments. The middle pie gives you the breakdown of our sales with regional versus global customers. the percentage of regional customers has been going up quite a bit in recent years, up to 70%. As you can see, also that puts us in a good position. And last but not least, as I mentioned it, we have to not only be close to our customers, but we have to be very close to the regulatory authorities in each region. And again, we are -- if you look at the number of approvals we've gotten for a completely new innovative ingredients across the globe, across different countries. I think there's no one else who comes anywhere close to that, right? And that is totally important because the regulatory environments are becoming more stringent. And so you need to work your way through that and be able to work your way through that in a fast and agile way. So that covers the 3 pillars: ingredients, the co-creation engine and the customer proximity. And we're investing in all 3 of them. But in the end, all 3, they serve to deliver the strategies that we have by segment because we run the company in a BU led way, but also within each BU looking at the different segments, right? And this slide summarizes the main strategic priorities for the 4 largest segments. So in Early Life Nutrition, we're very focused on continuing to help our customers with the premiumization that is going on in the high-income regions. But at the same time, there needs also to be a premiumization or an upgrade in the lower and middle-income regions. That requires them to come with more affordable solutions. And you'll see some examples of that in the in the experience room. So it's the 2, right? It's working high-income regions, further premiumization, but more affordable solutions for lower to middle income regions where a lot of the growth will have to come from in the coming years. Then on dietary supplements is coming up with differentiated new ingredients in differentiated blends, right? It's all about Blends, Blends that are good for healthy aging, Blends that are good for Health from the gut, Women's health, a number of up-and-coming help benefit areas and of course, growing with our regional customers. i-Health remains our window on the dietary supplement market with a very strong focus on health from the gut and on women's health. And of course, it gives us our own internal tool to test the market for our innovations, and you'll see a number of examples that in experience room. Last but not least, Pharma is all about expanding the portfolio. for instance, with CBD, but also expanding the applications, for instance, using our ingredients as excipients in bio-pharmaceutical products. So what do you have to remember from the presentation, One, we will rebuild the margin. And we will do so through the vitamin transformation program, capturing the synergies, but also fine-tuning the portfolio and accelerating innovation-led growth. To do so, we are continuing to invest in the Ingredient toolbox in the co-creation engine and in our customer proximity because the margin needs to improve through growth, right? We want to be a growth business and a profitably growing business. And by investing in the 3 pillars that need to work seamlessly together, we will primarily benefit our Early Life Nutrition dietary supplements and pharma segments whilst we will, of course, continue to accelerate our highly attractive i-Health and Biomedical business. So in summary, we will rebuild growth, right? Sales growth, 4% to 6%. That will come relatively quickly as we go in through the trough and we will rebuild the margin. That is something that's going to be a bit more gradual, require a bit more time. It's not something for the next 2 quarters, but it will happen. Very confident about that. Now someone told me that is not all about numbers that the numbers are not what people get out of bed for in the morning, not only the numbers, maybe surprised by a that, I was too. But I think it is this message. It is this message that I think ticks extremely well with our own people in our organization, and we have a very inspired organization. It's together with our customers to give the world's growing population healthy. A big thank you for your attention. See you in the experience room. And with that, over to my colleague, customer and supplier, Patrick.

Thank you. I'm always carrying to my customers too easy. He's my customer. I'm very excited to be here. I'm excited to be here to tell you something about the journey that we're going through with Taste, Texture and Health. And what I would like to do today in the 25 minutes, a lot of to be is actually go through, first of all, what's happening in the markets. Now secondly, why are we uniquely positioned in our opinion to actually capture those opportunities? And third, how and where are we going to grow? And I'm sure you're interested in where we are with our revenues are converted to. So our markets, what's happening in our markets? Well, our consumers are looking more and more in the Food & Beverages consumers for healthy solutions. 66% of all consumers actually have concerns around health and the nutrition they're taking. Very important. Delicious food needs to be delicious a superior sensory experience is required for a repeat purchase. So if our customers are not able to provide that, there will not be a repeat purchase. And last but not least, also sustainability with the consumers is continuing to become a bigger and bigger issue. Now what does that mean for our customers? Now if you look at our major global key accounts, you see there the real large FMCGs. They're definitely not increasing their spend on product development, on innovation. So they rely more and more actually on the suppliers. If you look at the growing regional local customers they do not have the capability to develop everything themselves. So they also rely on the suppliers and the partners. So you see that the importance of these partnerships with the customers is increasing. Now what else is happening in the market. So first of all, you see local taste differentiation is increasing ever and ever. It's going faster with faster new product development, and we need to keep up with that, and our customers need to keep up with that. Secondly, sustainability, as not just because the customer, the consumer is actually looking for it. But what we see also is our larger companies with a big brand, also have their commitments around sustainability impacting how they look at us. I was, couple of weeks ago, I was in the U.S. at the very large FMCG and one of our compounds, one of our ingredients was put on their list to be used by their formulators Well, not only because it also taste very good. But very important reason was it LCA, a superior LCA. And that, to me, was the first time that really hit and they're going to push it because they have made their own commitments. What you see also is that product reformulation is accelerating and accelerating, digital tools we developed for that, but it's really important because that speed, that requirement is going up and up and up. Security of supply. We've seen issues requiring that also affordability, but also changes in consumer preferences, clean labels, et cetera, all driving that accelerated demand. Now what's important in that is to solve that, you need to understand the interaction with your food matrix and your taste. Now you'll see a couple of nice examples, and you will have the chance to have an alcohol-free beer today. Alcohol-free beer. I don't know if there's real alcohol beer actually, but at least with us, you get an alcohol-free beer. What we're able to do, if you make an alcohol-free beer, I don't know who drinks it, but it's very sweet. And why? When I say, I don't know who drinks it. That's not a derogatory remark. Sorry, I do not know whom of you has experienced, we're drinking alcohol-free beer. But it's a very sweet taste. Now what we're able to do is with our enzymes, create that food matrix in this case, a beer matrix to make that much more neutral and with that, create much precisor tonalities of the end products. Now very important. On top of that, consumers are looking for less fat, less sugar, less sold, more proteins, health benefits, et cetera, et cetera. That requires also a continuous change of your product. And again, they are the food matrix and the interaction of that is key. You'll also have a chance to taste this. It is a recovery drink. I'm not going to ask you who view sports because then I run the risk of maybe giving the wrong impression by it, who does and who doesn't. But a recovery drink, which has a [ pepto-pro ] in it, which is a peptide, very small molecules, they get absorbed very rapidly in the body. So you get much quicker recovery from the sports activity than anything else. Now this is an older molecule. DSM has had this in the market a long time. It was never able to sell it, except for professional athletes and why? It's unbearable to presume. Now extremely bitter. Sarah talked about a bitter blockers and the ability we have to develop these -- with these receptor technology to develop the bitter blockers to allow you to actually make this taste better. You'll taste it -- again, speed of -- the need to speed up your product development and product development is not just 1 dimension, it's the interaction of the food matrix with the taste. And that allows us to bring delicious nutritious and sustainable solutions towards the market. We have the essential, namely health. We have the desirable taste and texture, and we have to sustainable altogether. I have a little short movie to show you to express that a bit clear. [Presentation]

So we believe bringing progress to life, we believe that where we are and what we do, we're a category of 1, we're unique. And why are we unique? We feel we have 3 items that are rather unique. First of all, our portfolio. We have a broad portfolio with synergistic on-trend products. Those are all very important on trend. Nobody wants to formulate out the products we have, the reach we have is on-trend. And secondly, what's important is synergetic. I'll come back to that later. Secondly, a very strong understanding of consumers worldwide. We have a big regional organization. We do understand very much how consumer preferences are evolving. And if you have the starting point ingredients and you have what the customer needs, you can connect that all for your product development, and we're unique in our capability in co-creation, application and innovation foresights. Now let me go into depth on all 3 of them to bring you along the story why I believe, together with all of our team, that we are a category of one company. If you first look at the portfolio, broad, synergistic, on-trend portfolio, these are sales, about EUR 3 billion divided over segments, all -- active in all the segments: beverage biggest; dairy; baking and confectionery; savory; pet; and plant-based. The numbers here are not important. What is important is this: the depth of the portfolio. The ability for us to help our customers with that coordination or that interaction between the food matrix and taste. Secondly, our co-creation, application and science capabilities. We have a global network of laboratories everywhere in the world, labs to co-create and to apply our products. Now why is that so important? 500 folks are working with our customers on that. What we call co-creation is actually the shaping, the making of a final flavor profile. We do that very often with our customers. They come to our laboratories. And together with our customers, we actually fine-tune it according to where they feel, and we have the consumer insights where we believe that flavor needs to be. If you have that flavor, if you have the taste profile, it needs to be applied in a product. We do that, too. We can make all end products possible for our customers. Now that synergy, we have also an application. As you can imagine, with our ingredients, we also have a lot of knowledge in application. So the synergy is there also. Now if you look at the science and innovation, we are unmet in our biology capabilities. Genetics, we can use, as also Sarah explained, we can use to develop natural compounds, clean label compounds. That's one. Secondly, the unique receptor-based technology. I shared to you an example on the bitter blocking, and that is really unique. And again, also science the capability to understand interaction, food matrix and taste. Last but not least, understanding local consumer needs. We do over 2,000 consumer studies and sensory consumer preferences a year. We touched 50,000 consumers. We've now extended that because that's all centered around taste preferences. We now extended that towards consumer positions and opinions about the health propositions. On top of that, we developed proprietary tools to use big data and artificial intelligence. An example is we have a program called Iris, where we take a lot of data publicly available, and we use that and predict trends on flavors. So we have -- for instance, we announced annually the flavor of the year. And our customers are interested to see what comes out, when it comes out and how can we link to that. Next to that, we have a program called Trends, a bit more human-centric. We look at change agents in the world, architects, urban planners, designers, et cetera, to see what are the bigger holistic developments. And the interest of our customers to be in dialogue on that with us is very high. So those capabilities, we have centrally and we roll them out globally. So every region has their own consumer insights department to help, to support the sales process and to help to support our customers in growing their business and fine-tuning the products that they have. Now how will we grow? We talk about synergies. I'll come back to that later. We have EUR 300 million in synergies. We've, as Philip said nicely, we've signed up for it. We've embraced that. We love to get the synergies. However, that also means that EUR 600 million actually of regular growth has to come roughly. So 2/3 of our growth, regular; 1/3, synergies. So we have to also keep our focus in our running businesses. Now that means we have a fantastic business in taste where we continue to grow and continue to add value to us but also to our customers by really using our brief machine, where we get roughly 15,000 briefs a year, where we respond to customer demands in a very agile way, where we have local assets, dedicated assets, multipurpose, quick turnaround and really help that fast product development cycle that we talked about. We continue to focus their growth based upon the fantastic customer intimacy innovation and the transformation to clean label/natural. Now our Ingredient Solutions will also continue to grow. Now that we call a value proposition machine. What's the difference? In taste. We explain that capability. We go towards the customers, give them ideas and they come back and say, "Yes, we really like that. But by the way, we like to have that target at a slightly different age group or with a slightly different profile on its flavor." So it's you create the pool. The value proposition model is much more of a push. We have a means for you to optimize your process. We have a means for you to optimize or fine-tune your product left or right with a functional ingredient. That's a value-based -- value proposition-based selling cycle. Global assets, segment tiered. There we said we continue with product leadership, or else we're going to do that. It's actually optimize the portfolio. I'll come back on that later. And last but not least, use the customer intimacy we have through taste to actually build that business further. Now next to that, synergies. Very important. Cross-selling. And it sounds simple, but it is very important. It turns out 4,000 customers, 10% of these customers have an overlap. So a lot of new customers. It doesn't mean those customers all need the same products. Don't get me wrong, but a lot new opportunities to go after. Example. One company, actually, we've been trying to change them to change the texturizer. They were very concerned that the texturizer actually would change the perception of the consumer. Now in the old days, our ingredient solutions by itself does not have the track record or the relevance for the customer to really explain why consumers or prove that consumers do not taste any difference. Now with taste, together, we are. So we got approved and we're starting to sell the texturizers. We have many more of those examples where going together, using a relationship left or right. Ingredients Solutions has fantastic relationships in the dairy industry due to specifically enzymes cultures business. Using that to enter with the brief machine is also a route for further cross-selling. Concept selling. What we do is we put our products together, shows some unique capabilities and bring it to the customer. I've gotten questions about how much have you sold of that and that solution? None. Or little. Maybe a white label generic retail chain will take something like that and put it in the market. Most customers, it's a trigger, they come back with a brief and we modify it. And something like that, we use the component to actually sell. You'll get to try a very nice Barista Oat Drink Flavored Milk today. And it has the flavoring the best-in-class milk flavoring that Sarah talked about, but also actually our solutions to create the foaming, which I'm sure if you like, your cappuccino, very important, and you get the industry. That's a concept. Again, we will not sell that. I think you are tasting a peach something. I think it's a peach flavor, if I'm not mistaken. Do not ask me are we going to sell the peach. No, we have now a whole portfolio to adjust that to other customers. I think you get the picture. On top of that, capabilities. That example I gave you about the sensory sharing capabilities, there's more. Next to innovation, there's more capabilities we can share and actually accelerate our growth. Now we also said a couple of growth platforms. You might say, why is not the home unit a growth platform? We got to also be a little bit careful about how much. What are we going to do together and what do we continue to run? Remember, 2/3, 1/3 of our growth, growth platforms. Plant-based. Yes, plant-based had some challenges last couple of years. However, the opportunities, the reason why there are challenges in plant-based, taste and texture, the label, affordability and nutritional content are all items we can address. So a lot of opportunities by putting all of our capabilities together. Health Benefit Solutions, we know a lot about what our products bring for humans. The question is how do you bring that to market? How do you use your marketing machine to bring it to market? We put up a sort of a center of excellence to help our commercial teams in the world to roll it out. On top of that, I look very much at Philip because Philip is developing hero ingredients, new hero ingredients, which I would love to put into Food & Beverage Solutions. But in food and beverage, you cannot -- you don't have the same premiums on that. It's a softer front-of-pack claim, so we rely on Philip to actually build up the scientific substantiation below it. Sugar reduction. Again, Sarah talked about the receptor, the sweeteners receptor. We can modify all profiles with that. We've built our position in our portfolio of sugar reduction business within the taste organization. But in Ingredient Solutions, we have a number of products that we can add to that, that also create the sweetness and we're combining that capability in the market. Last but not least, pet food. Pet food is a market where today, we have a business where we sell nutritional solutions. So we have a route to market. We have a dedicated sales force. We have the large customers. We have access, but only with one portfolio, nutritional solutions. We'll be adding there 2 pillars, one, a palatability pillar, taste, yes, and we use the capability in taste. It is different than pet. So this is not something that will immediately transferable but the know-how that we have, we can slowly but surely also capitalize on in our pet business. And gut health. We talked about the microbiome. Also for pets, the microbiome is key. 50% growth in claims over the last 3 years of new pet food solutions all around microbiome. We believe we are well positioned to address that demand. This is all standing on a foundation of our people. And I'm very happy with the people and the engagement of our folks. We've had an interesting 12 months. But with that, we kept the eye on the ball in the performance and we kept the eye on also the longer-term price, how to make sure we create this growth engine for our company. Engagement is high, is very high. And also the retention stays at the levels of before the merger. Those things make me very confident about us being able to continue to inspire our folks going forward. Synergies. Where we have synergies. Again, 1/3, 2/3, but synergies are important. We had the chance in Geneva. We had a teach-in in Geneva, which was in November, and we shared some closures we had. This is what we showed in November. So we're very happy with that. Why? Because it showed already the global coverage of synergies. We also had a teach-in in Princeton, in February. You see the list is growing. Today, this is the list. And again, I'm so happy about the spread. It's not 2 or 3 people that get together and they do that. No, it's globally, it's everywhere. And that shows the buy-in and the commitment of our folks to actually drive our sales. Now sales is great. We have a pipeline, takes roughly 12 to 18 months normally to transfer our pipeline into business, roughly. Don't take -- there's all exceptions to it. We're also learning how it now works with cross-sell, but that's in principle where we look at. And if you look at pipeline, it's developing very nicely. Checked it last week, 173 in our pipeline, a lot of opportunities. What is a pipeline? It's not an idea of an account manager. Now it's actually a discussion with a customer, a sample being sold to sell -- to send an activity, a quote being set out, et cetera, et cetera. So these are objective opportunity that are out there. If you look at our related synergies. We expect to reach roughly EUR 50 million this year. Things are looking actually pretty good at this moment. And we expect them to ramp up. 2026, a ramp-up a little bit faster. Why? We have now a lot of cross-sell the new joint concepts take a little bit longer time. As I said, we present them, we get a trigger back and slowly but surely develop together a few customers, new products. Focus. Where are we going to focus on? You've seen this sheet. It's not a surprise to you. When I look at the acceleration, we're going to accelerate in the 4 growth platforms. I think that goes without saying. We're also very much focusing on growing our taste business. It is extremely well positioned, very capable, global coverage, innovation, the whole backbone is there, but it also acts as a magnet for other business due to the whole customer intimacy you have in the taste business. Now with it, also our Cultures & Enzymes, we continue to invest, which is a nice specialty business and we'll grow our on-trend hydrocolloids as well as our premix businesses. The premix is a tool to bring our health benefit solutions to the forefront. If you look at our Improve to Grow business, our proteins. We have 2 types of proteins. We have a canola protein, which is a big specialty, which we're bringing to market. Now it's what we call a hero, unique ingredient, allowing us to come into a customer with a unique product and have a differentiating discussion. And then we have also the proteins that are based upon pea and chickpea and fava. Now what we said there, the pea, chickpea and fava-based proteins, it's a company we acquired a number of years back, and we need to accelerate moving that towards human consumption. And we do that by putting it into our concepts and really moving it into a global scale. So we'll move that up. And the canola pro, we're continuing to launch that and actually bring that to market. Now you might be a bit confused if I say their proteins to grow and have plant-based there. A plant-based is the whole holistic system, texturizers, nutritional package, taste modifiers maskers, et cetera. That's where we can really make the difference. Now interesting one is this. It's a protein-based bar. We got the protein, worked a lot of the customer in getting the business in making the protein exactly right, the right PD cuts, which means the right nutritional amount of nutritional value coming into the -- being absorbed by the person. However, we don't have to taste nor the texturizer in it nor the nutritional package. So this is one that needs to become part of the pipeline of synergies. Okay. But I wanted to share that with you to give you a feel about the proteins itself are important also to build knowledge and to build the solutions in plant-based. However, yeast extracts have a below-average profitability and above-average capital intensity. So we're looking at options to see what we can do to mitigate that, while at the same time, keeping access towards yeast extracts as a base product for a taste portfolio. The nondifferentiated vitamins, Philip shared with you already about. That's the bond being part of the carve-out of ANH. That's what we intend to do. So summarizing, we continue to focus our growth in taste for the brief machine, for innovation, customer intimacy and grow their business. Ingredient Solutions, we continue to drive our value proposition machine through product leadership as well as on top of that, optimizing the portfolio. Next to that, we'll capitalize on the machine and the machine, I mean, portfolio, consumer insights and ability to develop products -- and last but not least, we will deliver on the EUR 300 million revenues as well as growth through the growth platforms. What will that lead to? Historically, we've been running at 4% growth roughly. When you look at our synergies, that should be roughly 2%, a little bit more, let's say, 2%. On top of that, we're going to tune and accelerate. Remember the phases we had, tune-up portfolio, as I shared also earlier, and accelerate, i.e., we also add, for instance, Bovaer to this portfolio, which will lead to us to a growth rate between 6% and 8% organically. EBITDA percentage-wise, we used to run at 18% to 20%. If you put the synergies growth of roughly 2% organic and if you add there some cost efficiencies to it, you come to 2% to 3% additional EBITDA percentage and 1% to 2% as a result of the tuning of our portfolio as well as adding the innovation of Bovaer, leading to a 21% to 23% expectation for our EBITDA percentage in the midterm. Now I hope you feel I'm excited about what we're doing. I hope you are excited about what we're doing because we do something unique. We create a company, a category of one, and we create delicious, nutritious and sustainable foods. And in my opinion, and our opinion, nobody else can do that as well as we can. Thank you very much.

Thank you, Patrick. [indiscernible] make me thirsty, looking at all of the applications. And Philip, thanks as well for showing us the intro in the HNC business. I know you're super excited about the breakout room that your team has created, and we'll be leading into that a little later. But before we do that, we have some sweet indulgences. So the dessert served outside. And after that, we will be going into the breakouts where we will be showcasing what the business is all about to give you a taste, a flavor and a scent of what we bring every single day. Now I have to look at my speaking notes. So remember the colors. There's a color on your badge. That will determine the first breakout room. There will be a hostess and host outside that will take you there after you enjoyed the dessert. And the green one will start with HNC, which is at the right side when you go outside and you go through the corridor and then you'll find the breakout room there. Then the people with a red badge will start with a wonderful world of Patrick. You will be put on some aprons and you'll get some tasting experiences there. Those are at the left side. And the one with a blue badge will enjoy the wonderful world of Emmanuel and that is basically immediately in your back. So with that, enjoy. And then we'll see each other after you had all the experiences. Thank you. [Break]

Wow, what an energy. If that sets the tone for the last presentation, usually the hardest one to close the day, but a massive energy coming into the room, and that's what we wanted to do today. You cannot leave saying we didn't take good care of you. Can you? You will leave with the better skin, smelling nice. Philip provided you with dietary supplement for the rest of the week of the month. And Patrick made sure that you're not leaving hungry. So I hope you got a good taste, scent and feel for what we, as DSM-Firmenich, will bring. And I will continue to take you along on that journey. So let's look at the next phase. You have Dimitri starting the day. Going back to the dream taking you to the various phases all the way up to the new DSM-Firmenich set to excel in the future in terms of growth and profitability. I will be addressing 3 phases today as well. First, give you some insights on how we're doing on the synergies and how are we doing on a vitamin improvement program, 2 important commitments that will deliver our financial performance in 2024. Then I know many of you have questions, what about the separation of ANH? Can you remind us about the quality of the business? And what about the separation process? We'll give you some insights on that as well and explain where we are and what to expect on that front as well. And then last but not least, we will be translating the portfolio of the new deals and DSM-Firmenich will look like. We'll translate that into our financial targets that underpin our strong financial profile going forward. Now let's first dive in into the topic that we are anxiously understanding, and you've seen a glimpse of it in terms of our sales synergies, but I'm going to start very boring with the cost synergies. And by the way, Dimitri, I do get up for the numbers every Monday morning. Good. Starting with cost synergies then as well. Let's first remind ourselves what is it that we are committed to achieve. We will deliver EUR 350 million contribution to the EBITDA from synergies. And we've been consistently sharing measuring, tracking and will deliver 50% of that through cost synergies and 50% to sales synergies. At the same time, we have implemented our new operating model, and our ExCo colleagues are instrumental to that. We have been implementing the new operating model made all the necessary announcements with over 700 appointments. And you heard our colleagues talk about the importance of people because people make the difference every single day. People make the difference and drive a business. People sell, people deliver performance. And we did that with an engagement score of over 80%. Dimitri talked about it that it's a characteristic of a high-performing company, and it is. But more importantly, it subscribes that our people underpin our strategy, have a belief in the journey and are going out there every single day delivering the performance that we need as a company. Then if we look into -- a bit deeper into the cost synergies, also there, we have been communicating that the $175 million will be delivered over 3 levers. One is G&A savings. The second one is indirect savings where you start collectively streamlining your organization, leveraging the contracting that you have in place. And the third lever is improving the direct cost, bringing the cost of product to the market down. All those 3 levers will contribute more or less evenly to the EUR 175 million. What you can see from this page is the phasing thereof, where on the back of implementing the organizational model, making the necessary choices, taking the duplication out of the organization, G&A is contributing most to the delivery on the synergies of the short term. But what you also see is that the procurement savings and the cost improvements are coming through. And there, we also promised that after about 6 months, you would see them flowing through into our P&L. And why was that? Because you first need to go through your inventory and you need to go through your contracting cycle. So you see those benefits kicking in and we've been very transparent in reporting our contribution to our performance. We had the first contributions in Q1 -- or Q4 last year, where we indicated an overall contribution. And also in a Q1's earnings call, we are highlighting the contribution of the synergies and the vitamin improvement program. We'll come back to that a little later. If you then look at how that is ramping up throughout the period, we're confident and we're even ahead of target in delivering that EUR 175 million EBITDA from cost. We see EUR 100 million coming through this year. In addition to the benefit that we saw last year, ramping up to the $475 million in 2025. And every time you ask me saying, "Well, Ralf, what is it? Can you give us some tangible examples? And we basically highlighted a couple of big tickets for you. And at your left side, you actually see the benefits from a G&A perspective, where we -- on the back of making those choices, you streamline your organization, and you actually see that, that is giving us about EUR 20 million benefit on a run rate basis to the organization. At the same time, we're optimizing our processes and leveraging our shared services in the organization, which on a full run rate basis, will contribute another $10 million. So that is really driving the benefit in the G&A savings. That alone that has further opportunities there. At the same time, in the middle, what's the meat to the bone around consolidating offices? Well, it's contributing EUR 10 million in terms of our offices. There's more opportunity there. And it serves 2 purposes. It improves our cost base, our costs will go down, but more importantly, it also brings the organization together. So we added some couple of examples on the bigger places that we are consolidating and we'll continue to do so, bringing the organization together. At the same time, both companies were running at a captive -- insurance captive by consolidating that, merging the 2 captives and leveraging the power that you have and streamlining our insurance cover, we were able to secure a savings of EUR 10 million as well. Again, a sizable ticket, contributing to our confidence in terms of the ability to deliver the cost synergies for the group. And last but not least, an example next to the fact that when you team up, you start sourcing material together, and that is driving cost down, which we'll see an improved cost position in our inventory levels going forward, and we see that actually coming through with a slightly lower valuation of the inventory, which is giving us confidence that, that will find its way to the P&L as well. But at the same time, we're leveraging again the negotiation power of 2 companies together and also in the supply chain cost arena, we were able to secure about EUR 25 million of savings. All adding to our target, all adding to the confidence that we have in the ability to deliver upon that. If we then tilt to the other EUR 175 million sales synergies. They were commented on in each of the BU presidents because in the end, it's not me delivering the sales synergies. It needs to be embraced by our people. And I hope that by showcasing the examples today in the breakouts and gave you an example of the power and the ability that we can do as an organization, but also that you see the belief of our people and the excitement around the offerings that we can bring to our customers. and that is driving the sales synergies going forward. You also heard Patrick say that it takes 12 to 18 months before you actually see a new product development actually translated into commercial sales. So for that reason, we are monitoring the development of the pipeline on a, Patrick, on a weekly basis; Dimitri, and myself, on a monthly basis because we want to see that pipeline accelerated in order to drive the synergies. It's often the biggest question mark in mergers. Can you deliver up on your sales synergies? And we are confident we can. You heard Emmanuel talk about it and well ahead of plan. I don't need a full strategic period to deliver up on my sales synergies. I see in the Beauty & Care space, a lot of cross-selling opportunity actually coming through. Patrick, very confident around the pipeline. Overall, we see a pipeline of over EUR 275 million collectively for the 3 businesses that is giving us confidence in delivering the sales and associated EBITDA benefit from that. We see the first benefit kicking in, in the second half of this year. So we pinpointed down a number for the second half of EUR 70 million, and we see that now coming through, and that will contribute to the EBITDA performance of the group. Now next to showcasing, of course, the examples today. We showcase you other examples in Princeton and yet other examples in Geneva, and we can continue to do so. A couple of more of what the company can actually bring to our customers. And personally, pleased with the one, my bottom left, your bottom right. It's my guilty pleasure, I like ice cream, but at least Patrick ensure that there's a plant-based alternative, which is also nutritious. So I have to feel less guilty next time on consuming. But I'm also very pleased with the middle section because this is the announced offering, the Philip's team, where actually you can see the benefits of the merger really coming through with the taste enhancements that he can introduce in his products out to the customers. So also here, very confident in our ability to deliver sales synergies. We've got the pipeline. But more importantly, we've got the excitement with our people that are going out there, presenting these offerings to our customers, and we've got customer interest in actually embracing them and developing together. Now we did not only commit to synergies. We also committed to a vitamin improvement program, adding EUR 200 million of EBITDA on a full run rate basis to our P&L. And also here, we're making good progress. The momentum is improving in Animal Nutrition, fueled on the back of this -- the benefits of this program, which will drive up the EBITDA of Animal Nutrition as well. Of course, it has an impact on the P&L of HNC and TTH as well because selectively improving our cost base. And let me remind you of the 3 levers that are backing up that EUR 200 million of improvement. So on the one hand, we're optimizing the site network. You heard us walk away from several of the businesses in China, but we're also consolidating our premix network to still continue to drive the growth in the businesses but do it in a more optimized way and a more cost-controlled manner as well. At the same time, we're also applying the discipline in streamlining the organization. And that is both in factories, but also in the commercial organization and support organizations as well in order to improve the performance going forward. And that is impacting quite a number of people, the detailed slides that are published as well contain a bit more detail, but we're optimizing our offering in that front as well. And at the same time, we're focusing on cash. Because when your profitability is down, you also need to focus on continuing to deliver on your cash ambition. And with that, we have a strong focus in the animal nutrition space, in the vitamin space, on cash as well, where you heard us making conscious trade-offs between EBITDA and inventories, where we're deliberately starting to bring down inventory and prioritize cash over EBITDA. And that is something that we continue to be disciplined about. And at the same time, we're also disciplined in the level of investment that we're making, weathering through these terms, but it will restore profitability. So confident in the delivery and synergies, confident in delivery of the vitamin improvement program. Then we also brought focus to the organization. Earlier this year, we announced the separation of Animal Nutrition. Dimitri explained once more why it doesn't have the strategic fit. It comes with a different financial profile and at least synergetic. And if you're serious about executing a strategy of a business, then you also need to invest and we would not be doing that. And for that reason alone, it's better to find a new home by animal nutrition. But it is a good and great asset. And I do want to spend a bit of time explaining you about that as well. If you look at the business model, it is a unique model, and you've seen this slide before, where the combination of a unique portfolio and the widest portfolio of ingredients, coupled with a strong local network where we're present in around 50 countries where you can bring that technology, that product offering to your customers and have close proximity to your customers is a unique model. Fueled with innovation, we will deliver the strategy of Animal Nutrition and Ivo is geared to that of delivering sustainable farming. And that is something that we continue to do. But also financially, it's characterized by a strong performance because let's remind ourselves, and here at the top part of the sheet, you actually see the performance of our Animal Nutrition business. It has consistently delivered 6% growth over the period. It has consistently delivered a 15% margin. Yes, it is a bit more volatile. And that's why it doesn't fit the financial profile of the new DSM-Firmenich going forward. But if you look through that cycle, a very strong performance. And yes, 2023 is impacted. But we also constantly reminded you, it's an unprecedented situation with an unsustainable low vitamin pricing. And that basically forces you to adjust your production capacity. That's what we've done. We're focusing on cash. But if you look through that, that will be restored. And with the vitamin improvement program in place, also profitability will be restored. And if you then look at the business, it's a business well over EUR 3 billion with 3 distinct pillars. On the one end, you have your straight vitamins where we sell our vitamins that we don't consume in our premix, all the way up to premix where you have the ability to differentiate. And the more you can differentiate the more premium you can demand. And that business, that part is growing mid-single digit over the period, and we'll continue to do so because the world population continues to grow, people consume me, and we will continue to work on our inclusion levels. At the same time, at the left side, you see the Performance Solutions part of the business. And that has been growing constantly at a high single digit also last year. We often mentioned it in our quarterly earnings call that when you look at the overall profitability, one would almost forget. But that is EUR 1 billion sales. It has meanwhile grown to EUR 1 billion in size, and that is growing at a high single digit and comes with an EBITDA profile of over 20%. So if you look that and complement that with new inventions like Precision Nutrition, you have a very complete business that will find a great new owner at the right valuation. And that is something that we will continue to execute upon. Then looking at the execution. Before we look at the time line and how that all plays out and how we basically see this separation unfold, I think it's important that we also confirm that we've got the right team in place to do this. We have an experienced team that is focused on the separation of animal nutrition that has experience with carving out businesses, experience both in DSM-Firmenich, but also outside. So well experienced and they know what to do and what it takes in order to deliver upon our ambition to separate the business in 2025. It also -- there's a benefit of having a dedicated team in place that allows Ivo and his team to fully focus on the delivery of the business results because we need to continuously improve the business, bring back growth in order to drive the valuation of Animal Nutrition. And Ivo the team have embraced it because they also see the opportunity and we're grateful for that and they're driving that every single day by also embracing the opportunity by becoming a priority and attracting the right level of investment to execute the strategy of sustainable farming. So very pleased with that. And at the same time, we have a plan. We know how to do this. We've done it before. And we will do it this time as well. Dimitri showed you earlier in this deck how that timing actually looks like. And there's 4 distinct phases in that. And in your deck, there is a bit more detail what is done in all of these phases. But the first phase, following the announcement, we actually started preparing ourselves. What does it actually mean? But we're also having conversations with Philip and Patrick, they often joke saying, we're a customer and a colleague at the same time, what is of strategic relevance for you in the portfolio? Because that is something that we want to secure for the DSM-Firmenich going forward. So that is the conversation that we're having now. At the same time, we're looking at what is the right organizational setup, legal setup and the like for the carve-out businesses but also for DSM-Firmenich because we also want to take it immediately as an opportunity to even fine-tune the organization even more. But those are the choices that we're currently making. We will be making them all pre-summer, so immediately can go to execution in the second half of 2024. So we have the teams in place. All of the support functions have a dedicated team that is fully focused on securing the separation of the business. At the same time, once we finalize the scope, we can also start working on the financials. What are the financials of the Animal Nutrition business that we will be selling out there? What are the pieces within that, that allows us to actually go out and market the unit? At the same time, that will allow us to also look at how do then the financials of DSM-Firmenich actually look when carving out all of that. So whenever the restatement is done, we will be sharing that with you as well. So that is something that we will be working on in the second half as well once we finalize the scoping of the transaction. Then 2025 is all about execution of the transaction itself. We will be out there marketing the unit. There's a lot of appetite. We'll be speaking to many people. And with that, we will take the business to signing and to closing in 2025. Of course, subject to the customary approvals, just like any other transaction, but that is something that we are geared to doing in 2025, and we'll update you as we go. In the deck, it's not on the slide here. We also gave you an indication of the cost. We don't want to hold that from you as well. We're currently estimating that around EUR 100 million. It's a sizable figure. But it's a business. You have to also look at it in size. It's a global-oriented business. Remember, looking at a unique model present in around 50 countries. But at the same time, it's also a sizable business because with all the interrelationships that we have, when at some point, Ivo will be selling product to DSM-Firmenich in a normal supplier relationship. It's a business that will be above EUR 4 billion in size, giving you also an impact of the overall process that we're doing. Again, it's a first estimate of what we have now. We'll continue to update that because that is something that we want to do as well. We communicate transparently on the performance and how we're progressing along the way, and we'll take you along on that journey. But key things to remember, it is a great company. It is a great asset that will find the right home at the right valuation. Then turning to the new DSM-Firmenich. And you heard the BUs excited about their journey, the growth opportunities that they see, the areas that they want to grow, the areas that we're deprioritizing. And we're basically developing a company that will grow to over EUR 10 billion in size, with 3 distinct business units. And let me remind you, you saw them on stage today, with Emmanuel leading our Perfumery and Beauty business. Patrick, our Taste, Texture & Health, and Philip leading our Health Nutrition & Care business, all with a very nice growth profile, all growing 5% and above, all contributing to the growth ambition of the group. But also all with a very interesting EBITDA profile. And we're confident that we will deliver upon that. We will set targets that we will deliver upon. So we plotted them here. And what does that then translate into as target for the group? The 3 key headline targets. One of them, we -- or 2 of them you are familiar with. We added a third one. We will deliver a growth of 5% to 7% in the midterm period. That is a commitment from our side. And we will do that with a high-quality business. So we will deliver an EBITDA margin for the group of 22% to 23% in the midterm period. That is what we will aspire to. That is what we will deliver. And we've got all the levers to do that. We will deliver on the synergies, we will deliver on the vitamin improvement program, and we will deliver on innovation-fueled growth. Sarah will ensure that. We added also a cash target. We will deliver a cash conversion of at least 10% of sales, at least 10% of sales. I will zoom in into that a little later. At the same time, we're confirming our dividend policy. We will be distributing 40% to 60% of our earnings and subscribing to the confidence that we have in restoring our profitability, whilst at the same time generating cash. And we'll do that whilst protecting our balance sheet. We kept the net debt ratio the same, 1.5 to 2.5x, giving us a lot of financial flexibility to weather any situation, and we'll continue to do so. because we're also protecting our investment-grade profile as a company. Now let me bridge the 3 key headline targets for you. We're starting with growth. Historically, we've always been growing 4% to 5% in the businesses. You've seen that consistently coming back in the presentations of the BUs earlier today. We're going to fuel that further with the delivery of synergies. We will deliver EUR 500 million of synergies, very confident in the delivery of those. But at the same time, following the tuning of the portfolio and some of the accelerations coming into play, including Bovaer, we will be adding another 1% to 2% of growth, giving us a lot of confidence in delivering 5% to 7% growth. And you'll see that grow into the period as well, with synergies coming on stream towards the second part of the midterm period, with Bovaer coming on stream in the midterm period moving to the upper end of the growth profile. If we then look at EBITDA margin, the quality, how do we get to the 22% to 23%. Also here, our businesses have been consistently delivering around 20% earlier. And also that will be fueled by synergies. We're going to add EUR 350 million worth of synergies to the bottom line that will translate into an improved EBITDA profile of the group. At the same time, the tuning of the portfolio and the new innovations coming into play will improve that percentage even further. Again, giving us the confidence that we will deliver that 22-plus EBITDA. Now many of you will then also ask the question, well, but help me how to bridge from where you are today. Well, if you take out Animal Nutrition, and again, I'm not on stage to give you a full set of numbers, a complete restatement. We'll do that in due course. But if you take out Animal Nutrition today, we are at an 18% EBITDA margin. We then add the impact of the improvement of the vitamin improvement program in the area of these gentlemen. You also saw that coming back in the presentations earlier today as well. We're basically back to the level where we're starting, in line with our historical average of around 19% to 20%, and we will then add the synergies and the tuning of the portfolio, giving us a lot of confidence in our ability to deliver 22% -plus EBITDA margin. Yes. Then our third target, cash. And let me zoom in a bit more. This is a new one that we're heading, where we are committing ourselves as leadership to a minimum conversion every year of at least 10% cash. And that is built up of it. Of course, it starts with an EBITDA margin. We will be growing into an EBITDA margin of 22-plus percent But the 2 key drivers impacting our cash is working capital and is our capital expenditure. And on working capital, we started on an improvement journey. If we look back to the start of the merger when we actually went live on the back of premiumization that was out there on being a reliable party, we were at an elevated working capital. We were even at levels above 38%. And we were diligent in our actions to bring that down, and we brought it down to the low 30s towards the end of the year. I guided you for 31%, I think we came very close, let alone for some FX adjustments. But I also said that we will be delivering on a further improvement in 2024, and that is what we're committed and set to do. So we will be driving it towards 30%, hopefully even slightly below in that period of 2024, and we will be disciplined on our actions and decisions of taking that. That's also another straight line to have, and then you have to take into account the seasonality. When I gave an update in Q1 in the earnings call, there was a question you're not guiding for working capital, how we're doing. We are continuously seeking to see an improvement year-over-year in working capital. And everyone here on the front row sign up for them. Over time, we see a further improvement because we think 28% is the right level for the company that we are in order for us to run. So there's further improvement on that side possible, but that will gradually come. So we will see an improvement in working capital. And then obviously, working capital continues to grow with the company. Then tilting to CapEx. Here, we're guiding for 5% to 6%. I want to be very clear, we will be starting with 6%. We continue to see a lot of opportunity in our businesses. And at the same time, we're working through the finalization of our investment in Bovaer, but we want to invest and future-proof the growth of the company. And in order to do so, we see ample opportunity in our 3 BUs. And we will be making the necessary investments to do that to continue to secure the growth to deliver upon our ambition, not only through synergies, but consistently anchor and have the capacity to grow with our customers to a sustainable growth going forward. And we will be making those investments in the short term. Now following that, investments will normalize, will normalize to a level of around 5%, which is customary in the industry that we are. If you add all of that up, you get to an at least 10% cash conversion. And I want to stress that, that is a commitment from our side to what you sell that we will be delivering upon that in the period. Then maybe tilting also to some other financial metrics. The question often asked what about ROCE and how are you improving that? And what are you doing on that front? Also here, we will see a continued improvement year-over-year. Now we're talking about the core ROCE here, where we back out all the effects of the merger. So we will do the merger adjustments, as we explained earlier in our earnings calls. What we will not do is we will not back out all of the M&A because then I can go back 15 years. We created a new company, DSM-Firmenich. We backed out the merger effects, and we'll continue to do so for future M&A when relevant. But this is the metric that we're steering on. If you take out, we are at the 5% reported in 2023. When you back out Animal Nutrition or closer to the 7%, and we will continue to grow from there with at least 100 basis points per year, taking us well above the 10% in the midterm period as well. Last not least, we're also guiding for some tax. So the tax rate will normalize on 21% to 22% and 2 key things. First of all, it includes the effects of any pillar 1, 2 and 3 discussions. So that is factored in. We guided you to 20% to 21% at the outset of the merger. So the percentage is 1% up on the back of that. The second point, what is important, there's no adverse consequence of the carve-out of Animal Nutrition. So the percentage will be same. It is neutral to the organization, and there's also no major tax leakage on the carve-out and the separation itself. I know that's a question many of you have as well. How about setting priorities? In what kind of order do you do that? And let's look at our capital allocation policy as well. Number one priority, Dimitri would say it's priority number 1, 2 and 3. We grow what we have. We're happy about the portfolio. We tuned it and this is something that we will continue to invest in. That's where the CapEx will go. Over 60% of our CapEx will be used to fuel the future growth of the company, and that is priority #1 for us. So this is where we will be allocating our capital as a key priority. Then second, we know dividend is important as well. We repeated our policy going forward, but dividend is priority number two. The third one is M&A. Now let me be clear, it's not a focus for today. We are clear in our priorities. We need to deliver upon our synergies. We need to deliver on our vitamin improvement program, and we need to separate Animal Nutrition & Health. Those are the key 3 priorities that we are focusing on. Does that include bolt-ons or the like? No, but it's not a priority. And it's not a focus at this point in time. And then last but not least, share buybacks. Now it's a question out there as well. First of all, it depends on proceeds coming in. But at that point, we will be looking at all of the opportunities and options available to us, including possible returns to shareholders and the time when it's relevant. And we do that while being disciplined around our capital structure, protecting the 1.5 to 2.5x multiple in terms of our net debt levels and protecting our investment credit rating. And we added here basically the maturity profile of the group. We've got quite some refinancing coming up, but the good news is we've got all the financial schemes in place. We've got a bridge facility. We've got our ratings confirmed, which we're very pleased with. We had Moody's and S&P doing their reviews late April, and they both published a report confirming our investment-grade rating because they take us along in the journey as well. They see what we're doing, the choices we're making, but also the commitment we have as leadership to maintaining a strong balance sheet in that in place. So we can tap into the financial markets. We have the documentation in place. We have the guarantee structure issued, so we can tap into the markets whenever we see opportune, basically building a new maturity profile of the group. And that brings me to the end. Now I do want to leave you with a couple of messages, and that is taking us back to the flow that we see. Going back to the dream, merging 2 iconic companies, really focused on the merger, delivering upon the synergies, priority number one; delivering on a vitamin improvement program, priority number two. At the same time, by bringing the focus, we've put the team in place that has the experience to separate animal nutrition from the group, whilst at the same time, allowing Ivo and his team to fully focus on the delivery of the business and restoring profitability ahead of a transaction. And lastly, tuning the portfolio, setting us up for future growth by delivering a 5% to 7% growth with a high-quality EBITDA margin and translating that margin into a good cash generation. And with that, we bring progress to live. And thank you for the attention.

No, don't worry, we're not going to dance. I can tell you out of experience. You don't want that -- the movie you've seen was June last year where we had our top leadership conference. And we thought it would be a good idea just to dance for the rest of DSM-Firmenich -- we thought it was a good idea at the end I think they laughed more than that they enjoyed it. But nevertheless, I'm super happy to have the last phase. I think like Ralf was saying lots of questions on your list, we'll open with the whole executive committee to be here. We talked about strategy. We talked about our plans. You've seen our people in the booths in the breakouts. And this is the team that stands to lead the dream. And I think there are a few people on stage you've not seen yet. So you've seen Ivo. We talked about his business, Animal Nutrition & Health. He's been the President of Animal Nutrition & Health, and he's still full flat part of the team. So any question on Animal Nutrition & Health, whether you want to test whether Ralf or myself were right saying about animal. But I do think Ivo will contribute to the fact that it's a very strong business, but you can ask himself. Then we have James. He's our Chief Legal -- she is on stage as part of the Executive Committee here as well. And then we have Mieke, Chief HR Officer, and we share together the -- we are cocaptain of the Dream pot, right? And I got a few of your dreams later on, but I will use that as a closing remark. And with that, let's open the floor. Just raise your hand, briefly introduce yourself, and then the mike will appear and whether mike will come. It goes in randomly. -- but don't worry, we will have time.

My name is Martin Roediger from Kepler Cheuvreux. Regarding your midterm targets for your core activities, I heard that the starting point is not the day when you have done the merger that means May 2023, but end of 2024, which brings you to the time line for you achieving your midterm targets to the year 2027, 2028. Can you explain why is that the case?

Indeed, our midterm targets are 27%, 28%. That has been the case. I remember that you once asked in the room help me a little bit, what are your midterm targets time frame? And I think I told you that my midterm time frame is a bit longer than what your midterm time frame is. I've been heavily coached by Ralf and by Dave, that we just put years on it, and we've settled for '27 '28. Remember, we are on a journey here. I hope you appreciate that on that journey. We're just not going say no. We are in the midterm targets on quarter 2, '27 or quarter 2, '28. We're on that journey. We're making progress on the journey and the midterm targets at '27, '28. Next, yes just go at randomly and everybody will have his chance.

So you mentioned, let's...

Could you introduce yourself and then...

Yes, sorry. [indiscernible] Asset Management. It's an affiliate of [indiscernible]. So let's put about to 723. For the historical part, you mentioned more or less 4% to 5% growth and going forward quite much more. Can you elaborate or speak a bit between like pricing, volume mix and what you see going forward, maybe with more value added into your product more mix price into the algorithm of the growth?

Yes. Let's do a quick round on the BU presence in sort of a generic response, and you looking at pricing a bit stabilizing business predominantly volume. But let's do a quick round to get a bit of color. Let's start with you, Philip.

[indiscernible] volume when we speak of growth because we will probably see some deflationary effects from reducing raw material and energy costs. And in terms of the mix with all the innovations that we bring forward and some of the fine-tuning that we're going to do in the portfolio, there will, of course, be a mix effect in the margin. In the positive sense, yes.

Volume...

Roughly 1% pricing the rest volume. Still interested in animal? Because this is going to be in animal, we do expect volume growth as well in Performance Solutions, primarily as already mentioned also early in the presentation. And in vitamins is going to be a bit of a mix volume and of course, clearly, pricing as well. I hope that we will see a little bit of a price improvement through the cycle.

But throughout the planning period, we're focusing on volume growth. If you look at it now coming out of '23 in to '24, we can talk about a lot about inflation and the unwinding of that. But we're looking at a midterm period, and they were kind of saying, okay, the inflationary impact will be more that you continue to price slightly on and maybe it's closer to the 1% that Patrick was mentioning, is really a volume-driven strategy going forward.

Next let's flip flop from left to right.

Charles Eden from UBS. Ralf, probably 1 for you. Just on the cash conversion target and just looking at the definition, adjusted EBITDA less CapEx since down to the working capital. So if I take adjusted EBITDA margin, roughly 20% unless I choose -- use that as a benchmark, CapEx, 5% to 6%. That gets me to 14% to 15% potential sales. Down to a working capital, okay may go off a bit. Does that 10% feels very conservative. Is it -- am I missing something? why not 12%? Why 10%? Can you help me understand?

Yes. No, it's a great question. Why not 10%, why not 12%, and it's something we ask ourselves as well. When we put out a target there, that's a target that we want to meet and beat and that's something that we're focused on. But you also have to realize where we're coming from. Dimitri still hasn't forgiven me that I held back on 1 year of EUR 1 million that we delivered EUR 999 million of cash flow last year, and another EUR 1 billion around. But if you set that off against the top line that we had, we didn't deliver upon that performance. So that is something that we absolutely committed to growing into, and you also have to recognize that over the midterm target, yes, we will be delivering that target, we're more confident. But you also have to recognize a journey where we are now highlighting the margin of the portfolio today around 18%, but also the step down in working capital is still something that we're delivering. While at the same time, we are committed to making the investments in the business. So it's a target of a minimum commitment. And also, it's not 10% per se. It's a minimum commitment that we put out there. But rest assured, we'll not leave a euro on the table if there's more.

And I just wanted to build on that because I think it's a fair question. We're all -- you see a team here, which is extremely competitive, right? I don't know how we selected that, but this team is really competitive. So if we go out there with the promise, we want to meet that promise and predominantly like to beat that promise. Well, in the whole journey, I hope you appreciate that we would like to have a little bit of breathing room, right? We don't know exactly how everything lands. We know the big chunks of it. And we said in that process, let's start with at least 10%. That doesn't mean that we're happy with 10%. It shows that we had at least 10% with some breathing room. I mean we have ANH to carve out. We have the vitamin transformation to come in. We basically have to build on the synergies. You've seen the growth path of 5% to 7%. So we want to have a bit of breathing room. So let's put out at least 10% to meet it, but preferably to beat it. Next, we go to -- at the back. Yes.

My name is Artem, Redburn Atlantic sell-side. When talking about health nutrition and care business, you mentioned the role of regional customers, which was far as I remember, on 70%. Would you briefly comment on the role of regional customers in other business segments, maybe also by geographies, I wouldn't necessarily expect the numbers, but to emphasize where you see the role of those customers more important than in other areas.

For Health Nutrition & Care or for the other businesses as well.

For other businesses and maybe for geographies as well.

Okay. Let's make a quick tour and then go from right to left. So start with Patrick.

In general, I don't want to comment on a per region. But in general, the importance of local regional players is increasing in our portfolio. And I shared also earlier, that they need a little bit more support, more partnership, and we're capitalizing on that and growing there also very rapidly.

I think I mentioned this morning that we want to accelerate the -- what we call the regional consumer brands with tailored effective solution. And while also delivering with the global consumer brand. Now for the whole of some geographies like India, China is very important in the deployment and development of our local businesses.

And for NMO Nutrition, it's a very regional but even local business. Just to make that clear, the premix network, as mentioned also earlier during the presentation. It's super important we need to reach those customers. So it's a very local regional business. Global customers, of course, you have a few, but it's predominantly actually regional or even local.

And then Philip?

I think it was covered in the presentation. So for us, it's very, very important.

Good. And maybe I would like to circle that back to ask Mieke, who's the Chief HR Officer on how important other regions for us and how we -- I mean, we're an international company. So maybe you can say a few words on what you see around the world while traveling.

Sure. If you picture DSM-Firmenich we're a EU headquartered company, but the presence of where our people have been a big part of our business growth is outside of Europe. So you have to imagine U.S. is market #1 for us in terms of overall footprint also in terms of number of employees. Then we have China, which is extremely important for us and Brazil. The whole Latin American region is very important. So we make it a point of pride to make sure in line with the strategies that you've heard of business units to make sure that we drive the connection with regional customers that we have the right capabilities and footprint in those markets to not be at Europe-centric organization that's a key part for us of securing our growth [indiscernible].

Next. Whose next? Yes.

Matthew from Bank of America. Just a couple maybe for Ralf. Can you just remind me the definition of revenue synergy, $275 million number, what is the criteria to be included in that, given it's a pipeline. Is that just you're involved in a brief and then what sort of win rate would we assume. The second maybe I think it was Charles' question, just a follow-up on the cash flow. Dimitri, you started today talking about dreaming big yet you've put out a cash conversion target that doesn't strike me as particularly dreaming big. When you get to the end or closer to the end of this journey of creating the portfolio that you're aspiring to, is there any reason why your cash conversion wouldn't be at least as good as peers in the sector.

Okay. You go first.

Happy to talk about the pipeline here, but it's also a great question to my colleagues. So risk-adjusted pipeline when we're looking at it with there has to be a probability that this will be converted into sales. Now on average, it takes about a 30% conversion of the portfolio into sales, just like managing any other pipeline. We don't have a specific different definition for a sales synergy pipeline than a normal pipeline that we would manage. However, you also heard the excitement about -- from the BU presidents that you typically develop this in a close cooperation with your customers. So we do hope that the win rate is actually bigger than what we normally see in our business and as customary in the industry.

And then on dreaming big, I have to apologize. Indeed, if I dream big, I don't immediately dream about cash. conversion. I start with sales and an EBITDA and working capital and then as a consequence cash. Nevertheless, your challenge is fair. And I think I've responded a little bit in saying I also want to dream and that you go home and say, there's executive committee, it's a dreamy bunch, right? How can I really count on? I mean, give me a break. I mean, dreamland, I go to Disneyland, right? Well, here at DSM-Firmenich land and in DSM-Firmenich land, we take promises seriously. And that's also a dream, which I want to stand for. If we promise something, we go for the full MAX to do. So at least 10% in the company we're building. And I think I opened the door a little bit. Can we do more? Ralf was saying we don't leave $1 untouched. We'll certainly not. But I want to also promise and deliver and preferably beat. And I don't want to talk about other references, but we could easily put out their 12% and then we need to explain all the time that we'll get there. I'd rather put a number there where you can count on and then overperform. And I think in our industry, 10% actual if you calculate back over last years, it's a pretty decent number. So I don't know where you're exactly referring to. But we feel at least 10% in the company we're building with meat and beat is at this moment in time where we're building a company over time is the best way forward, also not [indiscernible] to be accused of welcoming Dreamland. Next, we go a bit to the right. Lots of questions here. Yes.

Chetan from JPMorgan. Maybe 1 for Sarah. We heard about co-creation throughout the presentation. How much of your R&D actually is through co-creation sort of a model if you were to break down your maybe it could be the question for business units as well. The second question I had was -- and this is Dimitri, you mentioned something I just -- I sort of found it interesting in the morning session where you said targets are not targets, but they are directions. I was just curious what exactly you meant by those comments. And the third question I had was just on dissynergies from ENH and the other businesses that might be sold, can you remind us of any number that we have or we should have on mind for dissynergies?

Okay. Start with cocreation.

Sure. I'm happy to talk about co-creation. And co-creation means many different right? So there's co-creation within DSM-Firmenich. And so I will give you a number, which is of the greater than EUR 700 million spend roughly 40% of that is in our group science and research organization and roughly 60% is spread across embedded innovation in the BUs. We work together as 1 innovation community. But that's where we're working. And then we also work with, again, as we said, more than 100 different partnerships across the different areas. Of course, with customers codeveloping. And what we do there is see what the need is and how we can go fastest to market and deliver what we need. And so we do that across all of our businesses, sometimes have deeper relationships and coming up to making sure that we can deliver the biggest traction in the market.

Okay Yes. No, I think there will be any follow-up questions if you needed there. Maybe on synergies, Ralf?

On the overall synergies, we once more confirm that we will be delivering the full synergies, both the separation of Animal Nutrition & Health and the deprioritized segments will now have an impact on that. We said that we're well on track, slightly ahead of track, and that's giving us the confidence for full delivery of the numbers as presented before.

And then interesting that you say that what's the difference between targets and directions? So the targets are 5% to 7% growth, 22% to 23% EBITDA margin and then at least 10%, which some people don't find challenging, but I think at least, on meet-and-beat. Directional were the ones which were done on the business units. Remember, the margins and the turnover. So from me to the BU presidents, those are targets from you to me, those are directional. Next question. We go here.

Alex Sloane from Barclays. A question on the deportation -- sorry, deprioritization of sales. I think you talked about EUR 600 million of sales in the opening presentation that deprioritize segment was 10%, I think, of EUR 9 billion. So I guess the first question would be could the EUR 600 million actually be higher? And if it was higher, would you raise the margin target. And then the second sort of related question just on the deprioritization of sales. I think you linked a few parts of that to the ANH separation process. I wondered if that's because early conversations you're already having are making you think that those would go together or this is just something that you're proactively doing as you go through that process?

Yes. All right. Thanks for that question. Let me answer the last 1 and then Ralf can say a few about the numbers. So we did the -- remember, we pulled forward the review of the portfolio from 24% to 23%, so that was even an advancement of the announcement of ANH. We're already starting that when we started the vitamin transformation program. Remember, when we launched the vitamin transformation program, we also had a hook that we would accelerate the portfolio review of ANH was a big chunk, and then the tuning was the second. So it was not related to it. It was really related to what's the market growth, what is the right to win and what is the capital efficiency. Then maybe on the big numbers. Yes, I remember it was a bigger or higher than EUR 600 million, so it could be a little bit, but it will be around that number. And I think whether it's EUR 600 million or EUR 700 million, it doesn't really matter. I think at the end of the day, we want to grow what we have with the core business, and we need to figure out a little bit on what's the best way, what are strategic options to valorize on those businesses because some of the businesses are really okay businesses, but it doesn't fit in terms of volatility of capital intensity in itself. So we also want to create a bit of space to see how that really falls out. But on the midterm targets, that is the new scope DSM-Firmenich where those 5 businesses were excluded. Next, we go to this side. We flip-flop, we got to the right -- to the left. Yes.

Fernand de Boer, Banque Degroof Petercam. Coming back on the capital priorities of capital allocation. You said that share buybacks is the last option, do we have to wait until the disposal of Animal Nutrition and then if you looked at M&A opportunities before you can decide what to do with the capital coming from Animal Nutrition? That's the first question.

That means you also have a second question?

I have a second question, if you [indiscernible].

We can be very short on the first.

Yes. Okay. Then the second one is on algae, you mentioned a couple of times during the day that algae-based Omega-3 is going to be quite important, but they also believe that Veramaris at this moment is sold out. So does it mean that you're going to expand -- increase your capacity at Veramaris and is it a joint venture? So how does it work that you have a lot of growth and maybe your [indiscernible] partner has less.

Can you do the first one?

Yes. Maybe on the capital allocation, it is the fourth priority, but we also do want to see the proceeds of the animal nutrition separation coming through. And only at that point, you can really look at all of the options that are then on the table. And we will look at it fairly at every single option, what delivers the most value and what are the opportunities on hand at that point in time. Anything in advance would be in the Dutch saying, you would [indiscernible]. So we wouldn't preempt any conversation or transaction on that front. While at the same time, we are committed to maintaining a strong balance sheet as well. So that is something we continue to lever. It provides a lot of flexibility. But we will come to that point. And at that point, we will take the decision weighing all the options in the interest of all stakeholders, including shareholders.

But for the English speakers in Russia, Ralf was saying as a fair financial officer, if you sell the skin of a bear, big bear at a fantastic price, but you didn't shoot the big bear yet, you're in trouble because fighting a bear is a bit [curious]. So be careful, be a bit cautious on where you spend the money. That's basically what you're saying, which is not a bad thing for a CFO.

But on M&A, do you feel you have white spots in your portfolio at this moment?

Well, I mean, you should ask the BU President and they will come on a whole list of what they like to do, right? But I think you've seen on the portfolio also with the clarification of Sarah, that I think we have no real big white spots. We have spots where we'd like to reinforce and strengthen right? And what we don't want to do now is to start already jumping into M&A. No, we want to show the potential the current portfolio has, deliver on '24, deliver on '25. And then maybe throughout '25, when we have delivered on what we have, okay, let's see what possible white spots could be coming. I mean I've been a business director as well. If my boss will ask, "Hey, Dimitri are there any nice ideas about M&A? I can tell you there was a long list of things, right? These gentlemen are built the same. But let's first grow what we have and then we view. That's basically the story of today. And I think it's good just to anchor a little bit what we have. Look at what we've done over the last year, and show beautiful growth and the profitability of it. And I think then on Veramaris. So the Veramaris is algae based, it's fermentation, and it means that you have these bugs in a nice reactor and they are all warm and cozy and if they are comfortable, they produce more. And they finally are a bit comfortable, they produce more, they produce quite a bit. and then you can develop strains to make these bugs even more comfortable and they even produce more. We're in that process. So we already have about EUR 100 million of sales. We still have room to enlarge that by strain development. And then there's an interesting area where we do see there is a huge opportunity that's in the human space. And I think Philip can elaborate that a little bit in the home and human space for algae-based face oil, it is partly going to animal, but I think there's real good growth in the human space, and I think you are super excited about that, Philip. Maybe a few words there.

What we're driving is we're really creating a new market here for algae lipids in the dietary supplement space and it's going very, very rapidly with the massive price increases we've seen on marine fish oil, right? So customers are now really shifting, and that is providing big opportunity, not only for Veramaris, we also still have a factory in Carolina in King Street that produces algae lipids and both factories are ramping up for human.

So just to make sure the animal space together with Evonik, human is our [indiscernible]. Next, we go here.

Sebastian Bray speaking. Could you set out the return on capital employed of each of the segments? Because DSM -- legacy DSM used to disclose it separately. And I don't think that the most recent annual report did. So if we take [indiscernible] taste texture now perfumer in Beauty and Health & Nutrition & Care where do they rank amongst the current capital employed and the amount of CapEx allocated across some to the business units? And Ralf, I'd like to pick up on the comment that you made about the capital allocation starting off at around 6% of sales dedicated to CapEx and then dropping towards 5%, in line with peers at the end of the midterm period. That's about EUR 400 million above what settings and would be if we just did that for peers. Is this just all 2 big-ticket projects, Veramaris expansion and [indiscernible], where exactly is the money going?

Very good. Let's first dive into the return on capital employed. We're obviously measuring that and taking it as a clear metric for us to focus on from a group perspective. following the separation, and it's a little early to start dissecting the balance sheet overall in the pieces. We will be providing it in due course once we finalize the scope, we will be indicating how much of that capital employed is obviously allocated now. And the way I look at capital employed is also basically pre any merger impact, if you like, really what are the assets that are driving the business because in the end, the allocation of that is a bit of an arbitrary effect. However, if you look at the profitability profile of each of the groups, PMB growing to 22% to 24%. The other 2 businesses going to 21% to 23%. And if you look at down at the balance sheet that associated with that and the global network that each of the businesses have there is no big differential in terms of profitability of those businesses. So that is something where we continue to grow. And you also have to look at it. Some say, hey, we've grown more organically over the period, some did some M&A over the years. But if you look at it and take a step back in terms of the underlying fundamentals, no big performance differential between them. Now then if you look at the CapEx, we're still completing a few big tickets and [indiscernible] is a big ticket also historically, we had a couple of those. What we see going forward is the continued investment in all of the businesses. We're making investments as we speak now, PNB launched a couple of new plants earlier this year as well. We're making investments in TTH, but also we see opportunities in the space of Philip in some of the businesses, including biomedical. So we will be allocating it. There's no ticket size in the likable way. So it will be more incremental, so there will be smaller chunks, but we will be making them in various places throughout the period. And that is where the money is going. And that will set us up for continued growth in the future. We want to seek improve not only our cost base but also seek that we have sufficient capacity to fuel the growth of the future. And that is why we feel that we are making the necessary investments now to set us up also beyond the synergies and beyond.

I think it's important to understand that the risk profile of the investments also changed with the new company DSM-Firmenich. I think in the past, with the legacy DSM part, where we had the ingredient player, you really need to build a differentiating ingredient to get in with a different risk profile. What we now have is this creation and innovation capability coupled with ingredients. So you will see far more risk-mitigated investment going forward. And therefore, we also moved from 6% to a more normalized 5% over time while building the company.

Next, I think we're just passed out here. So I think let's come back. Yes. Front.

Isha Sharma from Stifel. I have 2 questions, please. You define 27%, 28% as your medium-term target. But for sure, among the business segments, you might see improvement early on in some cases. And we have to be maybe a bit more patient in other cases, if you could please help us with some color there? And second question is very specifically on Bovaer. Could you talk about your collaboration with Elanco. The company has mentioned some pressure on gross margin because they are currently sourcing from a CMO in Europe and waiting for your plant to ramp up. So if you could help us how we should think about the phasing for your.

You do the mid-term targets?

Yes. If you look at the midterm targets...

You pushed me to put a year on it.

No. So we've been guiding to the midterm targets, we see a period of around 3 to 4 years, so that's 27%, 28%. But you're right, some businesses will grow into that. Some of them are faster, Emmanuel commenting on the 22% margin today. You saw a step up in Q1. So we'll grow faster into that space and anchor the profitability of that business. TTH making a continued step up as well. We're consistently also coming back. If you look at our performance, not only Q3, Q4 to Q1, and we also guided for a continued step out there, but that will take a little longer because also that where the synergies are kicking in Half of the cost will come earlier. There, we said clearly by the end of '25, but the sales synergies will start to improve going forward and also Bovaer and Dimitri will comment on that a little later. We're bringing the plant to life, which is in 2025, but then you'll only have a first full run rate in '26 and beyond. So that is a bit also skewed towards the second part of the mid-term period. So there is a differential between the 2, but there has to be consistent growth in all of them to [indiscernible] midterm targets.

And then indeed on Elanco, I think beautiful news on Bovaer, where we got approval, FDA approval in the U.S. I think it's 1 of the fastest FDA approval we ever gotten. Very happy to see. That's 1 of the reasons why we're very happy with Elanco because they have these inroads in the U.S. government and the regulations. Obviously, they -- we had a sort of an agreement that they basically will be the exclusive route to market for us in the U.S. They're looking at our Dalry plant, which Ralf was alluding to and they're going to build themselves, right? And now with the accelerated approval on the FDA, they basically need to buy from us because they're not ready yet to have their own plant in order. And obviously, we would like to have somebody buy it. And maybe that is not exactly what they had in their business plan. And be aware that we already have Bovaer sales as we speak, about EUR 30 million. But we do that in an agreement where we use suboptimal capacity. Right? Because we want to get it kick started with premarketing level. So we're not making real money on this marketing level, premarketing levels, the moment that the plant is started, which is a mechanical complete mid-25. It will take a couple of months to get it up and running so the real year will be '26. And now with the Elanco up and running, some part of that capacity most probably will be sold to the U.S. to get premarketing started for the U.S. before they have started their own plant. So that I think they will be referring to [indiscernible] to ask them. But looking at the context, I think overall, it's very good news for Bovaer. Remember, the Dalry plant is for about 5 million to 6 million cows and the U.S. market is 415-plus million. So I think this is really big for us going forward. Next.

It's Georgina Fraser from Goldman Sachs. And first of all, it was great to see in the breakout sessions, the combination of products from legacy DSM and legacy Firmenich used together. That was super interesting. But it did strike me in most of the sessions, there was still quite heavy referencing to vitamins. There's still clearly a very important input for your products. In your midterm targets for the new scope DSM, how have you thought about the procurement or cost of vitamins, what's included in those assumptions?

Well, I could highly imagine that perfumer in beauty talked a lot about vitamins. TTHs to a lesser extent, maybe H&C. And I think the presentation of Philip also show that we will bring that down in terms of portfolio. So a few numbers. So today, about 15%, 15% is vitamin still in the total of sales as a category. The moment that we carve out ANH, that will go to 7%, 8%. And the moment that we do all the tuning, it is more towards 5%. It's a bit too early to say what the exact amount will be, but I think you understand the trending of it. In the carve out, and you've seen we use '24 to separate and to really anchor the carve-out as such. We will clearly have sourcing contracts between these and Firmenich new scope where we buy vitamins from the ANH scope. And obviously, that will be commercial. I mean, a bit guided by DSM-Firmenich because at the end of the day, we want to remove the volatility in itself. I think ANH, also in the new ownership can handle that a bit better, including the assets. So it also means the idle costs are an important part of the volatility, not only the pricing volatility, but also the volume volatility. And if you have less volume, you still have your fixed cost, that adds another volatility part to it. We're in the midst of that. But you will certainly see that if we reduce that to between 5% and 7%, you also see that it will have reduced volatility. Secondly, the area of vitamins in Health Nutrition & Care are different vitamins. There are different vitamins in terms of specification, quality, but also the end markets we play in, registration and the like, vitamin D, ampli-D, different story than vitamin D in animal, right? So also there, there is a more stable margin going forward. So that's a little bit how we look at that. There'll be separate sourcing contracts will be part of the scope because the new owner will buy the business with the sourcing contracts we put in place. It's too early to exactly give you all the details, but the principles of how we look at it, I think I just shared.

[indiscernible].

You mean -- maybe you can use the mic so that the others can hear it. So you were asking, do we read anything in the word ownership.

Ownership structure rather than new ownership.

Yes. Yes, absolutely. Because -- and Ralf and myself have done many deals, by the way, together with Philip in the materials field. And ownership is a new owner. Ownership structure is creativity. So -- and we want to have creativity where we get the right value for the business we bring to new ownership, right? So ownership is important. Creativity about ownership structure to valorize on what we have is equally important. So we'll also look at different ways of how we valorize. So also the tuning, the deprioritizing segment those are different in the way how we deprioritize and how we review optionality to capture value. But -- thank you. Go ahead.

Sebastian [indiscernible] from Citi. Two questions. First on Animal Nutrition and your time line that you showed for the disposal effectively. To what extent is that dependent on where prices are? So if prices don't recover at all, would you be willing to push it out a little bit. And you mentioned fantastic pricing. If you could give us any idea what fantastic could be. The second question was in terms of the sales price, I think you mentioned right price...

You mean valuation.

Indeed.

I thought you were talking about vitamin process. Okay.

No. And second question was on Bovaer, whether you already have an idea of who's actually going to pay for it, whether it's going to be the pharma, whether it's going to be the dairy companies? And what type of margin we could expect from that business?

Okay. Let me talk with Bovaer prices. So who's going to pay for it, it's you. You know what 1 liter of milk costs? Do you ever do shopping yourself? They buy a liter of milk, I can ask that just before we started Bovaer because I didn't know either. A liter of milk in the supermarket costs EUR 1.60 in Europe, EUR 1.60. If you add the Bovaer ingredient, it will cost you EUR 1.61 with a considerably reduced methane profile of 30% for dairy products. So I mean, who is going to pay for it? I mean, at the end of the day, this EUR 0.01 per liter will not make the difference. But I would propose you pay for it as a consumer. And if not, you will see that brand owners are paying for it. We have many contacts with all dairy customers in the world who basically feel that they need to take action. And in that sense, we also see in some of the governments that farmers need to take action because they need to report emissions. So depending on where we are, but at the end of the day, EUR 0.01 per liter on a 1 liter of milk for EUR 1.60, the EUR 0.01 is not making the difference. So that is what the Bovaer ingredients is all about. Then a little bit on ANH time line. So we've put the time lines here. Because I think, a, it's good to prepare the organization to move accordingly because if you leave every out in the open, it becomes a bit is fizzy fuzzy, but we do basically want the time line there. We are not waiting for the vitamins to recover and then start selling. I think Ralf was pretty clear on the 3 components of the business. There is a Performance Solutions business, which is very strong with a high EBITDA percentage where the premix business with this very solid business, and you have the more straight vitamin business where there's volatility, right? So even if vitamin prices are recovering, the dynamics and the characteristics of this business remain the same. So we're not in a wait-and-see mode. We're prepared. However, it always helps in a process that vitamin prices go up a little bit, right? And hopefully, we'll see that continue going forward. And maybe Ivo, you can respond a little bit on what you currently see in the market to reflect a little bit on the vitamin prices, the volatility on today's situation. Don't take it personal.

No, no, no. It's [indiscernible] it's clear, of course, that we've been facing quite a bit of a challenge actually in the profitability. We see it still actually quite challenging as it is. Quite a number of vitamins are still actually not being at sustainable profit levels. But there is a bit of a positive trend and you may have seen it actually on vitamin E as well. It's a little bit early because we typically actually also in animal nutrition, we track behind by quarters. So you will actually see the effect later on in the year, not now. But at least that momentum is positive. So it is better than where we came from. It's a little bit early days, and I hope the trend will actually continue. So that's what I see. So in general, and if I have to [indiscernible] anyway, I would like to say once more on animal nutrition. The business -- the Performance Solutions business is doing really well as shown also by Ralf, driven by the major kind of mega trends in the space of animal nutrition. And then combined with this premix network as we have, which is really generating solid margin solid growth. Yes, I can only say actually,I'm [indiscernible] proud you're sitting on the business and driving it forward really for the future. So I'm optimistic in that sense.

Good. And then your question on valuation. You will be surprised if I mentioned a number, right? So I will not mention a number, I would just ask Ralf. How much are you accounting for Ralf.

At least a sizable number.

No, I think at the end of the day, it is a very good business and part is a bit depending on the vitamin normalization. But remember, we also had the vitamin transformation where we put the measures in place to recover ourselves, right? And today, like you always say, the Performance Solutions business is doing very, very well. And I want to remind you that we have acquired the urban business, and I think it was at a multiple of $15 -- $14, $15, where you see where my head is, I think, more about $15 over time. So it is something where, I think, partly, we put vitamin transformation in place. We see a little bit of vitamin recovery. But let's be careful. Let's just execute where we have control. And the business model itself over the longer-term period, and I think we need to understand that if you take a 10-year period, this has been a very good cash flow generating business. Remember, if you look at 2023, which was the most challenging year ever, it was almost cash flow neutral. So it's not that in that year, we're not generating cash. Over the 10 years period has been a very good business, but [indiscernible] a bit more volatile and therefore not fitting the company which we're trying to build. Next. Yes, in the middle.

Thank you. It's Chris Counihan from Jefferies. On the biomedical business, I'm just always a bit surprised within Human Health and Nutrition & Care, how it's in the acceleration, how it fits because when it was acquired, I think, about 10 years ago, it was probably more pitched as an overlap to the now divested materials business. So just trying to think about where that lands and the strategy going forward? And also maybe any comment on your Robertet shareholding as where that sits in the strategy, too. And the final one I had was just on innovation because there's a lot of talk about innovation, revenue synergies, et cetera, and sorry, Dimitri for bringing it up, but I remember the old 2025 target. So we're pretty close to that now. Firstly, the be in the 40% margin drop through. So just where we're at with that. And if it still has the same sort of margin drop through you would see going forward?

All right. Then let's start with BioMedical. As you remember, Philip and myself being in charge of innovation and materials, we decided that biomedical would benefit Nutrition Health & Biosciences. I think it was a brilliant idea. And we still think it's a brilliant idea, but maybe you can put some color on it Philip.

Yes, it's a great business that fits up using preventative Health. It's an absolutely great business.

Closer health, it really helps us in the setting. Secondly, Robert J, a nonstrategic share we have, let's be very clear on that. It's a financial stakeholder, and we value the company. I think that's about it. Then on innovation. Indeed, that was a clearly completely different company when we talked about that. But some bits and pieces are still there. I think Bovaer, we talked about was part of it. We had good health. We had high health. I think it was in the breakout sessions, very successful. We had the microbiome part being part of it. Veramaris was in it. So you've now seen Veramaris is $100 million and still working on the strains and working on the human inroad. So that really was helpful. So I think it's very difficult to bring it back because Solar were also part of it, right, which has now been part of a new company. But I think the big ticket items that we call it by then, and I'm just referring a little bit to your question on how does the investment profile look like? I don't think we'll have huge big ingredients CapEx-intense projects anymore. But Bovaer and Veramaris, we nicely fits into the scope we have consumer focused predominantly on the human side in health nutrition care with Veramaris and Bovaer in the area of Patrick with a dine-in to the dairy customers. I mean, Danone, Nestle, FrieslandCampina, Arla, they're all really much interested in Bovaer, which are exactly the dairy customers Patrick and his crew is referring to. So I think if we do on hindsight, the numbers, I think we still have a growth bubbles, which have been very successful so far. Although Bovaer, we can only judge in '25, '26. The margins are higher than the average, which we presented here. So you've seen on tune accelerate. The margins are higher, and therefore, it helps the portfolio going forward for TTH and for health nutrition and care. Next. Any questions left? I've got 50 seconds almost green. I think we're there.

Maybe 2 quick ones. I mean you talked about a lot of your innovations. But one of the DSM legacy innovations was [indiscernible]? And can you just share on where that growth profile sits, especially of the merger with Firmenich? And maybe just quickly on PMB, I mean so many questions on conservative targets. But clearly, you're in the higher end of the EBITDA margin target on PNB already, and you're kind of confident on the volume profile of 5% to 6%. and also confident that you can deliver the revenue synergies maybe early. So maybe just outlining why that margin target and why not higher?

I love that question. Thank you. Let's go to [indiscernible] first and [indiscernible] has been [indiscernible] on the sugar platform. Maybe, Patrick, you can tell a little bit. I mean he's been very excited about sugar replacement.

First, we ask where it ends up, but it ends up in the sugar reduction platform. I tried to -- tried to refer to that...

TTH.

Sorry, TTH. What I tried to refer to it is that, well, let's first take a bit of a step back to give you a bit more than a 1 line only answer. When we initially started as DSM, developing a strain creating a fermentation-based sweetener. We thought it's easy. You put it in water and it's sweet. It turned out to be somewhat underestimating the challenge. We then actually set up a JV, with Cargill to really make use of their knowledge in sweetener because in our perception, there are a huge player in sweetener, they're one of the biggest players in sweetener. Come to find out in the process that actually there is a further level of depth of complexity in sweeteners. And Sarah mentioned about the sweeteners receptor. And that capability only no one has. We have it or the receptor no 1 has, but the ability to really form a unique sweetener profile targeted towards the customer. Now luckily, the merger is there between DSM and Firmenich. So now we're able to capture that. We're not going to stop at Firmenich Stevia, we also look at other natural sweetener because we feel we're perfectly placed to expand the portfolio what you see is consumers need low calories, but also natural. And if you look at a natural fermentation biotech is a great opportunity. So alive and kicking, and actually, we're looking at the further in accelerating that.

The sugar platform, as we have today is above EUR 100 million in sales. So it's really, really helping forward. And then, I mean, yes, that's the bad thing about being such a beautiful business. You've always been challenged on why you're so conservative.

That was the last question. No, I think, as I said this morning, the team made an incredible job to perform and transform at the same time. and the transformation was absolutely key in particular in the area of ingredients, and I want to acknowledge that. Also, we were supported by a very good market dynamic, the volume in the fragrance area. And the key question is how this growth in fragrance will continue moving forward. So I think we confirm 22%, 24%. I also confirm that we're going to make portfolio adjustment this morning. And at this stage, considering maybe a less dynamic fragrance business moving forward and also further investment in growth to deliver the 5% to 6% growth is the right number at this stage. So that's what I will answer. Thank you.

Thanks. All right. Let's close off. Let's wrap the day and have some drinks and then you'll hopefully go home sharing our dream and also understanding it's not just a dream for dreaming. And I had 2 of your submissions to the dream jar. I wanted to share that with you because I was energized by it. One was, the dream is to continue to change the world. So you want us to continue to change the world. Thank you for that dream or put that back in because that's what we're trying to do every day. Then the dream is for DSM-Firmenich to continue the health, the security and the happiness for my family for as long as possible. I'm not so sure whether we can do that, but certainly via ingredients and products that -- so that I have more time with my family in terms of lifespan. Wow, that's beautiful, right? Thanks for sharing. And then there was also a dream that we like your dream, but we'd like to see more figures, and that was before Ralf did his presentation, right? It was before lunch probably. So I think I hope that we followed up on that. And then last but not least, thanks for being sincere about your dreams and promises. Thank you for that because that's what we're trying to do. We -- like Ralf was saying, we want to be transparent. We want to dream that we also want to deliver. So we'll continue to do that. We'll grow what we have. We will anchor what we do and we deliver on our promises, and we preferably beat our promises and bringing progress to life. Thank you.