Fluidra, S.A. (FDR) Earnings Call Transcript & Summary

[Presentation] Good morning, ladies and gentlemen, dear shareholders. Good morning, everyone. Thank you very much to all of you, firstly, for your participation, both on-site and remotely in this AGM, and be very welcome to this event on behalf of the entire Board of Directors and myself. There's been 2 years in which the pandemic has not allowed us to do this AGM on site. And today, the AGM can be followed in a combined way. We are here in the maximum governing body of the company to share the accounts and the management of 2021 as well as to share the current moment of the company. In previous years, we were delivering the comprehensive report this year. And given our responsibility in terms of environmental matters, you will find it available in our website, corporate website, fluidra.com, where you will have very detailed information explaining the company from the different standpoints with depth and transparency. Most of the members of the Board are today here with us, either on-site or remotely. But we will have to excuse Bruce who was COVID positive. He's perfectly well. I think we will contact him later, but he couldn't attend. You can see him there, you can see him there. Okay. So we are attending all here on site or remotely these 2 years. And you can see this later, have been years of strong growth, strong expansion, and our strengthening of the company since. Along with the strong organic growth that we have had, there's also the reinforcement of acquisitions. As you can see, during the presentation with the figures for year 2021, we have exceeded the goals in our strategic plan one year ahead of schedule. All these milestones met during 2021 have been possible, thanks to the human team who work day to day in [indiscernible] with their commitment and involvement and flexibility. So I would like to thank now for their participation, the human team in Fluidra and also the Board of Directors. And finally, I also want to stress and thank the support and the trust that we have had and received from all of you as shareholders of the company. Thank you very much, and be very welcome to the AGM. We will now hear from the Secretary of the Board of Directors, Mr. Albert Collado Armengol.

Good morning, everyone. Firstly, we would like to inform the shareholders that the Board of Directors wants to require the presence of a notary to draw up minutes of this AGM according to Article 203 of law and corporations and Article 7 of Regulations of the AGM of Fluidra. This task will be done by Luis [indiscernible], Notary of the Bar of Notaries of Barcelona, present in this event. So please, Mr. Notary, introduce yourself so that shareholders can identify you.

I am Luis from [indiscernible], Notary of the Bar of Notaries in Barcelona. I live in Sant Cugat. So I am attending and drawing up the minutes of this AGM in accordance with the provisions of Article 203 of law and corporations and Article 7 of the Regulations of AGM.

This AGM will be structured as follows: Firstly, we will meet with all the formal requirements for the valid constitution of the AGM. Subsequently, the Executive Chairman will carry out a presentation with information of interest on the year 2021, the evolution of the growth and other matters of interest related to the AGM. Thirdly, the Secretary will take the floor to inform about modifications to the regulations of the Board of Directors, the Audit Committee and the Appointment and Remuneration Committee of Fluidra approved since the last AGM in accordance with Article 528 of law and corporations. After this, we will open a Q&A time for shareholders in accordance with the provision [indiscernible] of the regulation of the AGM. Those shareholders who want to intervene in the AGM and request information or clarification in relation with the matters in the agenda or to formula proposals can ask their corresponding questions from now up until the end of the presentation carried out by the Executive Chairman, those shareholders who are here on site must write the content of their comment or question in the card that has been facilitated, together with the rest of the documentation indicating their names, surnames, the number of shares they hold and represent and to deliver it to the staff in the room from this minute. Those shareholders who are attending remotely can do it in the Q&A in the application of telematic support. When asking the question, they must indicate the topic and rise the content in the field for this purpose. If the shareholder wants for his intervention to be in a minute in those -- in case the of those shareholders who are here on site might ask this expressly and deliver the question in written format to the staff in the room so that the Notary can check it with the intervention of the shareholders. In case of the shareholders who are here remotely, they must ask this expressly, including the written part they want to have included in the minutes. In case that the shareholders does not facilitate the full intervention in whiten format, the Notary will freely write a content of thereof, trying to respect its essence. Also, the Q&A shift will be unique and a shareholder here on site must speak before the end of the presentations to the Santander room during this AGM. Once the full list of the shareholders who must intervene is completed, we will open up the Q&A, and we will mention the shareholders in the order determined. Those who wish their intervention to be in the minutes and have given it to the Notary, they must literally read it in their intervention. Regarding the shareholders who attend remotely, it will read the questions that can be answered in the AGM and the identity of the shareholder asking the question. If that question or information requested is not available, it will be facilitated or sent in written format after the 7 days following the AGM. After the Q&A by shareholders, we will go to the voting by the AGM on the proposals of agreements for those matters in the agenda. We would like to inform, ladies and gentlemen, that the remote voting channels will be closed at the end of this AGM. So we are now finalizing the formal requirements for the valid constitution of the AGM of Fluidra. Sofia [indiscernible] Board of Directors agreed on the 30th of March to call the shareholders to the AGM on the 5th of May 2022 at 12:30 and first and single call in the AC Hotel Sant Cugat and to also enable attendance through telematic means according to Article 28.bis of the bylaws and Article 10.bis of the regulations of the AGM, regardless of the right of the shareholders to attend in person. This was published in the [indiscernible] on the 1st of April 2022 and on the website of the company and the web of the CNMV on the previous day, 31st of March 2022, as communication of other relevant information where all the masses that are under approval today were included. The report of the Board of Directors and the full text of the remuneration policy of the Board have been available uninterruptedly in the website of the corporation from the published -- from the publishing date. And taking into account that the legal court of this AGM has been published as indicated, it is read for the necessary effects. And in accordance with the bylaws, this table of [indiscernible] is constituted with the Chairman, Secretary of the members of the Board of Directors of the company, all of them attending in person except for Mrs. Esther Berrozpe, Mr. Bruce Brooks; and Mr. Gabriel Lopez, who are attending remotely; and Mr. Steven Langman, who has excused his attendance. Those acting as Chairman and Secretary, Mr. Eloy Planes Corts and Albert Collado Armengol. It will be validly constituted in the first call when shareholders present or represented have at least 25% of subscribed capital with voting rights. So the share capital of Fluidra [indiscernible] are EUR 195,629,070, and it's divided in EUR 1 nominal value share. All of them have been paid up and subscribed and have the holders of the same rights. The shareholders who have issued the vote remotely accounted as shareholders who are present. We will now talk about the current state of the attendees. Having prepared this list with IT support and the figures facilitated by professional services, the provisional quorum of attendance is the following. When it comes to closing this left in the AGM between present and proxy 215 shareholders, 105,125,000 shares, representing 87.0, 125% of the share capital. So it is detailed that in the AGM, there is 41 shareholders of 701 million, equivalent to 3.73, 23% of the share capital. Out of these shares 5,812,361 are owned shares equivalent to 2.91% of the share capital. And this is according to Article 148 of the law and corporations. Represented in the Board, we have 134 shareholders holding 124 million shares equivalent to 83.28, [ 82% ] of the share capital. So wanting to -- when according with the provisions of the law and corporations, we have the required quorum the constitution of the AGM and first call. The final quorum will be indicated in the minutes of the AGM, and it will be communicated through our website. So there is quorum enough for the valid constitution of this AGM in the first call and to debate all the matters included in today's agenda. We will now hear from Mr. Chairman.

So complying with the different requirements and the bylaws and regulations of the AGM, I declare validly constituted this AGM meeting the legal requirements to that effect. We will now hear from the Notary who will carry out the corresponding legal warning.

So in accordance with Article 101.3 of the regulations of the business registry, I have to ask the following question. Is there any shareholder here wishing to protest regarding the manifestations regarding the provisional number of shareholders in the AGM and the capital present and represented? If that is the case, please tell me now. Also, those who are attending remotely and do it through the remote attendance application. The final quorum will be reflected in the minutes. Let's wait for a minute to give some time for shareholders, especially those who are connected remotely, in case anyone has reserves or protests. It seems no one does. So I have verified that the legal requirements for the constitution of this AGM are met.

Thank you, Mr. Notary, and we will now hear from the Chairman of Fluidra, Mr. Eloy Planes Corts.

The truth is that this report should be done together with Bruce, who's left me all alone. So I guess it will be all up to him next year. I think I am the one in charge of the slides. So in this intervention, I would like to basically go through the goals achieved during 2021 to analyze where we stand this year. and the perspectives of the year, we have just presented results in less than 2 hours ago and to devote [indiscernible] at the end to corporate governance and to the remuneration policy for shareholders. The year '21 has been an extraordinary year flow for Fluidra, not only because of the figures setting a record year in all its parameters, but also it has been a year where truly the company has or complete a lot of transformations. In fact, 2021 is especially and particularly important because of these topics. I would like to specifically talk about 3 topics. One is the reinforcement of M&A with strategic operations, I will go in deeper into that. The second one, progress in the commitment with sustainability, social and governance matters, ESG, and also entry in IBEX 35. This has been a year of recognition, significant recognitions of the sector of the investor world and civil society. I will go for the industry and the sector now because I believe that these 2 last years have been very difficult to adapt to with a pandemic and the strong growth of markets. Last year, practically all were geographies were recognized by our customers and the work done. And I would like to stress the work of the U.S. for the first time in history, the 4 recognition awards, the most important ones in the U.S. market carried out by customers with a strong presence there have been for the same manufacturer in this case, Fluidra. So beyond the figures, there's structural changes but also recognition by the structure and the industry. So going into the figures. Here, you can see spectacular growth, 47%. Out of 47%, 36% is organic growth. Last year was an active year. You will see it later within M&A, representing 11% of this growth. And this growth has been practically in all regions of the world. The U.S. has been the champion with a growth of 83%, of which 56% is organic. And today, the U.S. represents 41% of our turnover. The U.S. market represents approximately 50% of the world's market. When the M&A with Zodiac took place, the combined one, we had a 30%, and we've gone halfway already because we truly want to lead the market. We are already there. I will give you some figures and days. But the weight of this market represents truly there was the weight of the global market. So strong growth in the U.S., strong growth in Europe, growth of approximately 32%. And looking at the P&L downwards, strong expansion of margin EBITDA there for EUR 150 million. That is 71% more than last year. But if we look at it in terms of percentage, the improvement of EBITDA margin this year has been perfectly 3.5 points from 21.5% to 25.1%. So this expansion is in terms of reported net profit, reaching EUR 252 million, and a figure that is important for us is the net cash profit because we have an intangible amortization level in this company, which is relevant. And this profit here is the profit that truly represents the capacity for the company to generate EUR 337 million, doubling the figure of last year. As I was saying, I wanted to talk about 3 different things. First, M&A. Let me give you a perspective and context for all this. You're all very serious, aren't you? Are you okay? Okay. Let me just give you a bit of context. On the one hand, I want to say that Fluidra today is a global leader in the industry. When we look at our position and globally speaking, we like to look at the market with wide amplitude, not only this meaningful sector, that's how we like to look at it. So Fluidra is 13% of the world market, that's our penetration. So for you to have an idea, the other 2 manufacturers together represent 14%, the other 2 big manufacturers. So if we look at this in a narrow business with our core business, stakes are higher, the average is above 20% and some families of products above 13%, 14%. This is our view where we can see the size and the leadership that we have compared to the other 2, but this also shows that the market is very much fragmented and that there is a strong option to be reinforced through strategic acquisitions. And in fact, you know that Fluidra has been doing this continuously. Our view of the supply to be a professional of the pool professional is a wide one. We want to offer our customers everything they need to carry out their activity. And this is not a vision which is equal in or with the other stakeholders in the world's market, we have a wider view. If you look at the acquisitions, existing ones, they all reinforce product categories basically in the U.S. market, where we had a narrow offer. Or supply in last year, as I was saying, was an extraordinary year, EUR 500 million in acquisitions were invested practically 97%, more even 99% of investments in the U.S. market. And with these investments, the supply that we have in the U.S. market is very close to the supply that we have in the rest of the world markets. So an element of true transformation of the company, not only figures as I was saying before. The next element, which I was also stressing at the beginning is the commitment that we have with ESG matters. Nowadays, there is a clear awareness and also a growing one in practically all interest groups, so clients, suppliers, users, employees, investors towards the concept of the need of companies to have a more holistic view or a view that goes beyond the P&L of a company, and that truly companies should get involved in the great challenges we have at societies in the world. As an advice, we believe that a clear approach that is truly part of the strategy of the company will not only transform us or make us a company that is more responsible, but also generate some advantages and differentiation that compute to our peers, and you have the capacity to generate business. This is our positioning. And in fact, approximately 2 years ago, we presented our responsibility blueprint, which is where we set the goals as a company. These 3 -- in these 3 pillars, environment, social and good governance, and for us, this is our transformation guideline for the company in this field of ESG. Here, you can see a summary of the different targets that we have set for ourselves as a company. And within the integrated or comprehensive report, you can now access through our website, you can find all the detailed information of all the progress made with explanations in all the fields. Here, you can find a summary of the headway made in the last year. I'm not going to go through it because I see your serious faces. I'm not going to go through them all, but I would like to focus in the improvement of rating. It is difficult to improve if you don't measure yourself, and we decided to measure ourselves over a year ago. And here, you can see our evolution because when you measure, you can see your progress. So these indexes: Standard & Poors, [indiscernible] Analytics, there are rates in which we have been improving from C to B-, from 47 to 60 in S&P, and Sustainability Index is the lower the better. So we have gone down to 24.6. So this shows the commitment and progress in ESG matters. And the third element of a significant transformation is in the world of investment, our commitment with the investment community, with the shareholders for us has always had 2 key pillars. On the one hand, the fact as being capable of taking the company and giving visibility to this company in the investors' world to reach investors more and more throughout the worlds. In fact, if you remember our merger, one of the great pillars of the merger was that the size was allowing us to access many more investors. Last year, we managed to complete a key milestone as a consequence of the improvement of liquidity, thank you to the fact that the completions has been done in the 18 months from 42% to 11%, providing liquidity to the market through institutional investors that have improved the liquidity. This was important to be able to access IBEX 35. And also, very importantly, there's fine grain work being there with investors talking about the company and reaching further to greater numbers and of higher quality. In fact, this year -- or last year, we had 900 interactions in the investors' world and the Capital Markets Day. And I'm going to give you a figure. This is a relevant figure because we still have this and see this today. As a company, we are listed and discount as compared to the U.S. companies, and our work this year has to -- has been to close this gap. And closing this gap also means to reach the investors' world in the U.S. and the U.K. And in the last 9 months, the evolution of the shareholder -- or the profile of the shareholder, Fluidra has gone from being 1/3 to 2/3 in the Anglo-Saxon world, and this is very good because they know the world are showing improvements in the world of [ water ] and can better assess the company in this market. So as I was saying, in these 2 pillars, for me, this is a key transformational part. Being in IBEX 35 as a consequence of the advancements in recent years and which gives us greater presence and visibility today. The second element or pillar is remuneration to the shareholder. We have always believed that the shareholder must be paid year after year based on the performance of the company. And the growth of the company and results, as I was saying before, last year, we will see greater perspective later, has allowed us to evolve with our commitment of paying out 50% of the net profit, net cash profit. In fact, we have multiplied by 4 the dividend. If you look at the dividend paid out only 2 years ago. And this transformation because we have also brought up a company with the capacity to generate those results. So it's also a transformation as I was saying. The results of 2021 have been extraordinary. In fact, when in the extraordinary AGM in 2018, I think, it was June, I can't remember, June, July of 2018, we presented you with the merger with Zodiac. We also presented you with a strategic plan for the year 2022. So here, we have wanted to show you the comparison so that you see where we are when we finished last year compared to this figure and the plan. And you can see that in all figures, we are ahead, not 1 year ahead or not only 1 year ahead, but the figures are in a different level totally. So for those of you who are here, have been shareholders for many years, I would also like to show you another perspective for these results. So before the merger, and from that moment until now, Fluidra is 3x the size, and it has a EBITDA result of 5.5x. The ones we used to have, we are not talking about a net result, which is 8x greater and return on imported capital of the double, which is a significant figure. It's a figure that shows the capacity of the company to generate value for shareholder. I would like to say that Fluidra today has managed in these years through the merger and through making the most of the moments of growth of the industry Nowadays, Fluidra is not only a world leader, but it is a unique asset with a growth structure and results, which is also extraordinary. You can see that we're very positive with what we've done. We have worked a lot but things have turned out fine. Sometimes you work a lot, and things don't turn out as fine as this. Okay. Let me now move on to the second point, first quarter of 2022. It is a reality that COVID has placed pools at the center of outdoor living, and we have experienced a change of level and size of the market of pools. It's a real step change. And this sort of growth rates that we have witnessed in the past 3 years, we know they are not sustainable given the market structure somehow they need to be normalized. And we believe that the market's normal growth rate should be at about 5% to 6%. And this -- the dynamics for 2022 in our industry, in spite of the volatility and the uncertainty of the market is still a very solid one. And we foresee that, of course, already this year, this will be actually normalized. But as you can see on the right-hand side, the highlights we gave to the market for 2022, this implies a substantial growth rate between 12% and 17%. And we foresee an expansion of the EBITDA margin of 0.5 percentage point in a complex environment. From the point of view of inflation, we are in an industry in which you can actually transfer prices with a little bit of delay in time but in a consistent way. And that's why we believe that we will also expand. In spite of this inflationary environment, our margins stood by 5% or 6% and net cash profit of 60% to 70%, which is impacted because we have had a refinancing of the debt, which is good for the company because our debt is at a maturity of -- the maturity will be in 2029, almost 2030. And we have done that these refinancing to the first part of the year, and we benefited from a good opportunity window. What this gives us, puts our mind at ease. We have the cost of the debt assured for the next. So as you can see, we're waiting -- we're expecting a very good year. On the left-hand side, you can see the results we have presented today. A growth rate of 31% in sales, a good evolution in all of the markets. Our EBITDA growing at the same level. The first quarters are the most difficult quarter from a comparative point of view. We expect in the second half year to have this expansion and a net profit that increases by 12% approximately. So we expect a very good 2022 full year, very -- a very solid one. End-to-end, allow me to devote my last 5 minutes to the corporate governance and to talk about the remuneration for shareholders. The commitment by the company and by the Board with the transfer and the compliance of the recommendations made by the stock exchange authorities is absolute. Let me just share with you a piece of data. Out of the all of the stock exchange authorities' recommendations Fluidra complies fully with 86%. And partially, we partially cover 97% of these recommendations. And this is a figure which is above the IBEX 35 average. and here, we also provide all transparency. You can see if anybody has questions about it, we can explain it. Well, we do not comply. Why would you not comply and what's the road map to comply? And not only this, I'd like to put your mind at ease because at Fluidra, we do this consciously contentiously. And in fact, there is a report by a reporter, which is a report carried out by an external independent agency, especially for listed companies in the Spanish stock exchange market about the quality of the information we gave and the company's transparency. Fluidra, nowadays is a 7th company in the global ranking going from 15 to 7. So we have made a significant [indiscernible], and we're #1 in terms of transparency. And in fact, some of the awards I mentioned beforehand that we have received from the investment world have been first because of our Capital Market Day and because of the quality of the information we provide to the market. Allow me now to get into -- very briefly into the activities carried out by the 2 companies committee, the Audit Committee with this task of assuring the accounts and processes that assure this. And so that the company is focused on risk management. I'm not going to read out all of this sheet of paper. I just want to highlight that amongst all of these activities, supervision for the improvement of the nonfinancial quality information and the supervision of the improvement or the increasing the amount of nonfinancial quality information. We have this ESG part, which is very important, but that needs to be measured and it needs to be consistent. And this is work that companies must carry out and somehow, we must make sure that they are reliable. And at the Audit Committee, we have been working not only during these past 2 years in a very significant manner on this matter. And then in terms of the Retributions and Nominations Committee, you have the least, this is just part of the report. They have worked very hard, but this is a summary of the report. Let me highlight 2 things. First, [indiscernible] with one of Rhone's placement. He was a member of Rhone Capital representatives. He left the Board. We started as such. And well, the Committee started as such, and nowadays we have with us, in fact, well, Barbara. Welcome, Barbara. Thank you for being with us. Good work was done. Barbara has been with us for a couple or 3 Board meetings. How many, Barbara, 2 or 3 Board meetings? And the truth is that she is a person who will help us out very much in making the company evolve. Let me highlight that point. And then let me also highlight another more significant point because it will need to be approved, which is a work carried out by long-term incentive plan. We finished the long-term incentive plan we had for the management team, which was linked to the results of 2018 to 2022. And we've designed a new plan that goes from 2022 to 2026. We need to have a good alignment with the company's management, with shareholders' interest and value creation for the shareholder. And that's why we have worked on a plan that we will present for your approval here today. And that's it. So let me end. I'd like to end by talking about our capital allocation policy, which is linked to our remuneration policy for the shareholder. From that point of view, our basic principles are clear. The [indiscernible] we have always had them. The first one is a clear financial policy, which is to manage the company with EBITDA, with a ratio of debt EBITDA of 2x. So this gives us a very solid balance sheet because it is a very cautious approach. And it gives us flexibility because it would allow us at some point, if we have to make some sort of an acquisition that demands greater -- a greater amount of tax to increase it and to have financial muscle for that. So that's the first of the 3 fundamental pillars in our policy in terms of capital assignment, capital allocation. The second one is to invest in M&A. We have demonstrated in the past and the market is still highly fragmented, and we are market consolidators. And we know that through M&A, we are able to generate value for the company and value for the shareholder. Therefore, we did a significant part of our capital allocation for cash generation or cash generation goes to M&A. And the third element is that we believe, and as I said so beforehand, that the shareholder needs to be compensated year after year on the basis of the -- of the company's profits. And in fact, our policy is a clear one: 50% of the net cash profit this year, we suggested doubling it. You have it on stream, EUR 0.85 paid evenly into -- or evenly split into payment. The great cash generation muscle that Fluidra has, allows us to be in a [indiscernible]. We generate enough cash to carry out M&A and to split. By 50% of this M&, A we generate more cash that allows us to do more M&A and compensate even more the shareholders. So we are in a virtues loop. And as an example, let me mention that last year, net debt below free EBITDA, EUR 500 million invested in acquisitions that reinforces and that nowadays are giving us benefit. They're giving us profit. Taking advantage of the fact that we're at the AGM and at the time of growth in cash generation, we have added amongst the tools we have available the what we call a share buyback. These alternative additional possibility, this allows us to keep these 3 pillars, we keep as our current policy. Our priority is M&A and dividend. And depending on the cash surplus and the market conditions, we will use this share buyback, too. And now let me really true end. On our side, I believe that you may count on the engagement and the full commitment of the whole team, the whole company and the whole Board to keep on working to make this company evolve, to improve and to make Fluidra a stronger company every day. And we will keep on doing it with the attitude that crack fries us and energetic, enthusiastic, creative attitude with consistency, respect and values. Thank you.

So let's continue. Before going to the next point, let me remind the shareholders that once the Chairman's speech is over, we will close in the next second, the Q&A session at the AGM. So if you have any questions, please send them to us. According to Article 528 of the Capital Companies Laws, we inform the shareholders about the changes in the rules on the Board, the Audit Committee and the Retributions and Appointment committee approved the last AGM. On the 30th March 2022, the Board agreed before the favorable sentence by both committees to approve a number of modifications to the rules for the Board, the Audit Committee and the Appointments and Recognitions Committee in order to adapt these regulations to the news introduced by Law 522 of the 12th of April, through which we modify the refunded tax of the capital -- the company's law approved by the legislative rural decree, 120-10 of the [ second ] rule. And other financial rules with regards to the promotion of long term -- of the involvement of long-term shareholders in listed companies. And due to this certain adaptations deriving from the shareholder composition and some strategic focus given to the ESG. As a result, the Board agreed with regards to the Board's rulings, first, to change -- to amend Articles 3, 5 and 6 in order to suppress subject matter as a result to the Board, once we have seen the reduction of the percent of the stake of on capital below the threshold as agreed by the different shareholders, founding shareholders of Fluidra and Rhone Capital as was communicated to the market on the 3rd of November 2017 through the stock exchange authorities were paid. Second, to change Article 12 to introduce a new name of the delegate commission as delegate commission for strategy and ESG and to widen its function. Thirdly, to change Article 13 and 14, which regulate the Audit Committee and the Appointment and Recreations Committee respectively to introduce some preferences that will be developed afterwards in their rules with regards to the functions committees, especially with regards to the constitution of [indiscernible] to change Articles 5, 17, 24, 25, 27, 33 and 34 to adapt then to the amendments introduced by Law 5/2021 in the company law. The Board agreed with regards to the rules of the Audit Committee, first, to change Article 6 and 22 in order to adapt the linked operation regime to the amendments introduced Law 5/2021 in the company's law. And secondly, to include in Article 10, the obligation to inform the Board about the management report and the perceptive nonfinancial information introduced by Law 5/2021. And finally, the Board agreed with regards to the Appointments and Retributions Committee first to change Articles 10 and 23 in order to adapt other content to the amendments introduced by Law 5/2021 in the company law. And secondly, to adapt Article 11 well aligned with the content of the [indiscernible] of the good governance code of the Stock Exchange Authority. The reform the text of the rules of the Board, the rules of the Audit Committee and the Retributions and Appointments Committee is available to you on the company's corporate web page. So now we should start with a Q&A session. We have not received any questions so far. Therefore, we now need to proceed to the voting of the proposal of agreements belonging to each one of the points in the agenda. The voting will be carried out according to what it says in our bylaws and the rules of the AGM, subject to the provisions of the rule applicable. According to Article 24 of the AGMs, in general rules, those in favor will be those that are -- that correspond to all of the actions in the meeting and we deduce first. For those belonging to the shares whose holders or representatives have expressed that they vote again, they vote blank or they abstain through a communication so that it appears in the minutes. And in this case, we ask them to give it in writing so that the staff can give it to the new republic by identifying themselves with the names and surname, the number of shares they hold or they represent, the number of the proposal, the vote against or in blank or abstaining. Others who are virtually so that they vote for the means for that. And secondly, those belonging to the shares whose holders or representatives have left the meeting below the vote, and they have left -- they have said they are leaving. In the minutes, there will be the result of the voting for each proposal. If any shareholder wants to leave in a minute, the sense of his or her vote with regards to some of the improvements, it should be given to the card given to the staff members or those who are attending virtually, they should do it using the virtual means given by the company for that. And the shareholders will have available the full list of the equipments adopted reflecting for each one of them, the result of the voting and the essence of the votes that have been carried out during the AGM. The agreement proposals made by the Board about the points in the agenda and the reports have been available on the company's web page since the AGM was called, and so they will continue to be read. All of the proposals for the agreement that are subject to the voting will be need -- will need to be approval according to the legal majorities published in Article 25 of the AGM bylaws. In this AGM, all of the agreement proposals except for the proposals belonging to points 10, 16, 17 in the agenda will be approved by a simple majority. In other words, more votes in favor than against. However, the bylaws changes proposed on report number 10 in the agenda and the delegations to increase the capital proposed in point 16 and 17 in the agenda will be approved by an absolute majority. Bearing in mind the data that the corporate services have in the company. I tell the shareholders that there have been enough favorable votes to approve all of the points included in the agenda by sufficient majority. Now we will read the summaries of the proposals presented by the Board. In the first point in the agenda, the approval of the annual accounts and the management report both the companies and its consolidated group of companies belonging to the financial year as of the 31st of December 2021. Secondly, the approval of the nonfinancial consolidated information state of Fluidra, S.A. as of 31st of December 2021. Thirdly, the application of the result of the nonfinancial recording the following allocation to negative results from previous financial years, EUR 29,869,613.97. Fourth, the approval of the Board management in 2021. Fifth, approval of the compensation for shareholders through a distribution of dividends, gains reserves for EUR 0.85 growth for each share, which implies a total maximum of EUR 166,284,709.50, if the allocation is done for all of the ordinary shares of the company, which will be paid in 2 payments, EUR 0.43 per share in July and EUR 0.42 per share in November, both this year. Sixth, the approval of the relation of Ernst & Young as the auditor for the company and its consolidated group for 2022, 2023 and 2024. Seven, the ratification of the appointment by [indiscernible] and of [indiscernible] -- and of Madam Barbara Borra as an independent Board member. Eighth, the appointment of Mr. Bernat Garrigos Castro as a proprietary shareholder for the company. Ninth, approval in a separate way, the relation of Mr. Bruce Brooks as Executive Board member and the reelection of Mr. Steve Langman and Mr. Jose Manuel Vargas as proprietary Board members of the company. And on point number 10 in the agenda, we present for the approval separately, the amendment of Article 16, 25, 26, 33, 42, 44, 47 and 43 of the bylaws in order to suppress the subject matters result for the Board and the AGM, once we have seen the reduction of the share participation of Rhone Capital in the company below a certain threshold. And to include in the bylaws, the possibility of having just virtual AGMs and to adapt the bylaws to the changes introduced by the Law 5/2021 according to the company law. And in point 11 of the agenda, the approval separately, the amendments in Article 6, 10, 14 18, 20, 21, 22, 24, 25 of the AGM rules with the same end as have been mentioned beforehand. In point number 12, we present a consultative vote, the annual report about the remuneration and compensation for the Board members in 2021. Point 13, the approval of the compensation policy for the Board members for years, financial year 2022, 2023 and '24. Point 14, the approval of the maximum amount of the fixed annual compensation for Board members, which is EUR 2 million. Point 15, approval of a long-term incentives plan for executive Board members and managers of the Fluidra group. Point 16, the authorization to the Board for 5 years to increase the capital according to the limits expressed by the law to exclude the preference subscription right limited to a maximum of 20% of the capital of the equity. Point 17, the authorization to the Board for the next 5 years to issue bonds and warrants for a maximum of EUR 500 million, excluding the preferral or preferred subscription right of shareholders limited to a maximum of 20% of the capital. Point 18, an authorization to the Board during -- for 5 years to issue fixed income bonds and stakes for up to EUR 1.2 billion to guarantee these emissions. Point 19, the transition to the Board for 5 years that this company may proceed to the derivative acquisition of its own shares directly or through group companies. And finally, point 20 in the agenda, the delegation of powers to formalize, interpret, complement, develop, correct and execute the agreements adopted by the AGM. We give the floor now to the Chairman.

Good gracious, I was worried that you would actually choke, Albert, reading so fast. Well, thank you very much. With regards to the votings about points in the agenda, I can tell you that according to the information we have received, so far, and once we have verified the votes represented by the shareholders, who have voted again to have abstained from the affirmative votes carried out according to what has been defined in the AGM rules, we have approved by sufficient majority, the proposal for the agreements presented by the Board. In the minutes, we will give the results of the votings and also the essence of the vote of those shareholders who have asked that to be done. And the agreements approved and the results of the votings will be published fully on the company's web page within the next 5 days after the end of the AGM. And let me inform you that the -- in the Notary public's minutes, it will be taken as the minutes of the AGM. So we do not need to read it or approve it. A lot of you know well Fluidra's story. The story of a family-owned company that has been able to grow throughout many years with a high capacity for work at a high capacity to make its management model evolve at its structure with constant transparency and value to create value for customers, employees and shareholders. On our side, as I've said beforehand, you have our full commitment. You have our human teams' commitment, our management team's commitment and the Board members' commitment to keep on creating value for all of you, and for all of the stakeholders, even in such a challenging environment. And now allow me to thank you all, ladies and gentlemen, all shareholders, for your trust and support. And I'd like to thank all of the Board members for their good work and to recognize the work of our management team and the whole members of staff, which is a basic foundation to attain our goals. And to conclude this AGM, I would just like to thank once again your presence and attendance in today's AGM. And to remind you, that you should not leave too far because this is a tradition in our AGM. At the end of the AGM, we will give you some glass of champagne. So if you leave too early, you will not get your class of champagne. So this is the end of Fluidra's AGM, plc. And given that the [indiscernible] have other issues to be dealt with, this is the end of the session. Thank you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]