KWS SAAT SE & Co. KGaA (KWS) Earnings Call Transcript & Summary

So good morning, everyone. Welcome to our first Capital Markets Day here in Einbeck, live from our headquarters. And I'm very happy to see so many familiar faces here coming to Einbeck, coming to us. I also would like to welcome the participants joining today via our webcast. My name is Peter Vogt, Head of Investor Relations at KWS and your host and moderator today. Before we start the program, just a few opening remarks. As customary, please take note of the cautionary language as we will be making forward-looking statements today. So please take note of that language. This brings us to the agenda of today, fully packed. We have the first presentation of our CEO, Felix Büchting and he will talk about the importance of seed innovation to address the challenges of agriculture and how we at KWS want to contribute to that. Second presentation by Sebastian Talg, member of the Executive Board on cereals and corn. Maybe I should say cereals and corn and sunflower. It's a crop that we haven't talked so much yet. But as we have matured our product pipeline over the last couple of years, we're actually at the edge of introducing a wave of new products coming in the next few years, and we have the ambition to build a significant relevant business out of that, reaching EUR 100 million, hopefully in 10 years. The second -- sorry, the third presentation will be delivered by Nicolas Wielandt on the one hand on Sugarbeet, our flagship business, you could say. And Nicolas will talk about how we will, in the future, build on the success of the past innovations that we have with bringing new innovations. And here, we also have ambitions to expand our business, targeting EUR 1 billion sales by the end of the decade. And vegetables, where we have invested quite significantly in the past years. And we are actually at a point where also here, we have moved the product pipeline forward. And over the next 2, 3 years, we will introduce new varieties from our strategic crops. And by 2028, all of our strategic vegetable crops should be on the market. After that, we will enter a break of about 2 hours, first for lunch, but also for an R&D tour. So the second tour for today, in the morning, we -- you participated here in Einbeck in the Sugarbeet tour. The second tour will be on -- will have the focus on R&D. And we want to show how we combine high-tech with handcraft, and I think that will be a very interesting excursion. And I will talk a bit for those who are here in the room, I will give some instructions later once we are there. The afternoon will be kicked off by a presentation of Thomas Ehrhardt, our Head of Global Research on Research and Development, the longest presentation of today. As you can expect from a company that is so much dedicated to innovation, Tom will talk, among other things about how we use cutting-edge technologies today to develop the products of tomorrow. After that, presentation by Jorn Andreas, our CFO, on financial framework and outlook. But he will also talk about our business model and why it's so attractive to be a pure-play seed breeder. And there are even the companies out there that are even breaking up these days to get there. So that's, I think, a very good spot that we are in, and Jorn will talk about more of that. The day will be finished by our CEO, Felix Büchting, with closing remarks, and we will then also open up for Q&A. All presenters will be on stage addressing your questions. So we have plenty of time either then or during the lunch break to talk about your questions as well. With this, leads me to wish you an insightful informative day, and I'll leave the stage now for our CEO, Felix Büchting, please.

Good morning, ladies and gentlemen. Very happy to see that so many of you came here to Einbeck in the middle of nowhere in Lower Saxony, and also welcome to those participating online. It's a beautiful winter day. We had the first frost this morning. I had to scrape my windshield. So it shows we are in the seasons, and this is exactly what agriculture is all depending about. Thank you, Peter, for the introduction. So my name is Felix Büchting. I'm the CEO of KWS, and I have a big pleasure of kicking off today's first ever Capital Market Day for KWS. For those of you who might not know, I have more than a professional relationship with KWS. I have a great privilege of being the seventh generation in operational responsibility. We are and remain a family company, and this has certain "repercussions," as you will see in the course of our presentations. It's the long look. It's thinking in generation and not being afraid of tackling challenges that might not have an immediate return on invest next year or the year after. But we're convinced that with these decisions, we pave the way for the future. But before looking into the future, it's important to know where we come from, the past, looking back at almost 170 years of history. It all started in a small village south of Magdeburger and Klein Wanzleben, therefore, hence, KW. S, of course, for Seeds. And whereas my ancestors that started sugarbeet breeding, 1856. Today, we're a market leader, about 70% market share, and Nicolas will talk more about that. In the 1920s, we decided to go into a portfolio diversification, as you would say today, and we picked up cereals breeding, so meaning wheat, barley, oats. Today, we're #1 in winter wheat and winter barley in Europe, and we're a global leader in hybrid rye. In the mid-50s, we launched our corn breeding activities and oilseed rape breeding activities. Today, in Europe, we are #1 in silage corn so for animal feed and the strong #3 in grain corn. In oilseed rape, we're #2, and it's our clear ambition to become #1 in Europe. 2019, we started to step a little bit outside our comfort zone. in the sense to leave the world of row crops and to go into vegetable breeding. Today, we're a market leader in spinach, strong in beans. And those 5 strategic crops that Peter alluded to, we'll see what will happen in the future. But our ambition is clear. With that, I would like to take a little bit a look at what is the field and the current situation we operate in. What's the framework for a seed company? What's the framework for agriculture? And there are plenty of challenges. And I think most of you are somewhat familiar with these numbers. They don't come as a surprise. Global population is rising. We expect to be roughly 10 billion people by 2050. That means we need to produce 60% more food and seed by then. At the same time, we lose arable land due to urbanization in the more favorable climate zones and of course, due to climate change in certain regions of the world. This translates to the fact that we'll have 33% less acreage per capita by 2050. So if we want to continue to feed everyone on this planet, we have to make up for this gap. And we, as the seed specialists are part of the solution. I think we're not so bold to say we're the only one that will not be true, but we have an important role to play because we can bring a lot to agriculture, agricultural productivity because the seed is at the start of the agricultural and food production value chain. You could say it starts with us. How are we going to contribute to these global challenges and have an impact. One, of course, is what we do since 170 years, it's increasing yields, leveraging genetic diversity, translating that into genetic gain and at the end, allowing the farmer to harvest more on the same acreage or to produce the same with less acreage per se, sustainable. But this won't be enough. With climate change and irregular weather patterns, we focus on the development of resilient varieties. Varieties is what we call products. And this means varieties that can cope with prolonged period of drought or stress or pests. In addition, we see, especially in Europe, that we have an environment and the societal expectation that we reduce the input of crop protection so reducing inputs. And while this is clearly driving a more sustainable agriculture, it kind of counteracts productivity. And therefore, we see an opportunity to provide genetic solutions also in this regard. This relates on the one hand side, to innovations in a given crop. But on the other hand, we see a tremendous potential in what we call unleashing the power of crop rotations because one is controlling disease pressure or weeds in a given crop. And on the other hand, using crop rotation to preserve soil fertility and pest and weed management on a long-term basis. Last but not least, healthy nutrition, our venture into vegetables, a clear contribution on that side. We also know we want to feed 10 billion people by 2050, we'll not be able to feed those people if they all live in American way of life in terms of diet. This means less meat, more vegetables. And last but not least, of course, also for agriculture, we were convinced to leverage digital solutions, holistic advice to our customers to run their farms effectively and efficiently. So that's the big picture. That's our contributions. How do we want to leverage that in terms of value capture? Very easy. First on the bottom, classic breeding, cutting-edge technology. And Tom Ehrhardt will allude more on that, what that means. In addition, you know that we continuously deliver explicit trade innovation. That's how we call it, explicit trade because you can name it, you can price it, you can see it. That's CONVISO SMART, Cercospora Plus, PollenPLUS. In addition, we have digital tools and services to support our customers in running their farm operations. And Nico will share with us how we venture into high-value crops, vegetables, the endeavor we have started in 2019 and a daunting challenge to convert the potato market from a Tubo market to a seed market, but I don't want to spoil it too much. At the end, we also realized that leveraging our technology and our knowledge about pea genetics, we can identify genetics that bring advantages to the food industry as a food ingredient. It's a small activity also there, Nico will share some more light on it, but we see potential for value capture also in this domain, maybe a little bit new business model compared to selling a bag of seed to a farmer. Taken all this together, we have given ourselves a relatively new strategic framework for the short and midterm. We have published that at our -- after our results published end of September, and it is clearly spelled out because it's very easy, 4 numbers, if you want, even though you only see 3 on the slide. 3% to 5% organic sales growth, and Jorn will dive deeper into that, 19% to 21% EBITDA margin and a dividend payout ratio of 25% to 30%. While some of you might say 25% to 30% is not that ambitious, well, we're a family company, and we're convinced that it's most important to reinvest the money into the company to fuel tomorrow's innovations. All that based on our sustainability ambition. How are we going to achieve that? Three pillars: lead, build, advance. And I'll briefly touch on those because later on, my colleagues will take you deeper into each of those segments. Lead refers to our broad portfolio in agricultural crops or row crops. I've already spelled out of you where we are currently in the markets and what we have achieved so far. We're convinced that with a customer-centric go-to-market, a full advice to the farmer on how to leverage crop rotations, we can leverage this very broad portfolio, which is almost unique in the industry. You see here sugarbeet, of course, we will continue to drive and lead the market with innovations. Silage corn, we are #1, and we're very strong in grain corn and will certainly make gains in market share and expansion in this area. You're also aware that we have reshaped our portfolio here. We've stepped out consciously out of the GM markets of North and South America to focus on the European and non-GM markets, and Sebastian will share a bit more insights on that. And then you have the cereals. That's actually the cereals business unit because those of you that paid attention in biology will clearly say oilseed rape is not a cereal. And I have to say you're absolutely right because cereals usually refers to monocots and oilseed rape is a dicot. But we clustered under cereals. We are #1 in hybrid rye. We're strong globally and #1 in winter wheat and winter barley in Europe. And as I said, #2 in oilseed rape. And we are very sure that we can leverage that portfolio even further. Also there on the horizons, and I think later in Tom's speech talk about that, what we see as the next step in cereal innovation talking about hybrids. Build the next pillar. This is our long-term value capture and growth drivers. On one hand side, vegetables, and I remember very well the discussions we had in the Executive Board in 2019, if we should dare to step into that segment. On the one hand side, we can fully leverage our breeding expertise, know-how, our technologies to bring that to vegetable breeding. On the other hand, different breeding targets, different markets, different customers. Your average tomato grower in the south of Spain is not growing sugarbeet. So there was a little bit of step out of the comfort zone. But also here, we have a clear plan. We had a clear target. We know that it takes time to start breeding programs from the scratch, but this is a hallmark of us as a seed specialist and a family company with a long look. In addition, we were able to acquire Pop Vriend Seeds. Today, our running operational vegetables business going very strong, and Nico will share more about that. KWS Food Ingredients, as I said, bringing innovation to the food producers in terms of plant-based protein ingredients. And the real challenge then potato seeds, where we want to replace 3 tons of tubers for a hectare by a bag of seed. Also, this takes determination, innovation and a long look. So it goes way beyond the normal midterm horizon. Third pillar advance, and we'll spend most of the afternoon, almost all of the afternoon on this part. First, with a tour of R&D and then with the presentation of Tom to look into where we are in trade development in breeding. And I just want to leave it with this teaser, I think clearly showing that we have a track record in delivering innovation to farmers and the various crops we work in. With that, I would like to hand over to Sebastian to take you into the cereals, oilseed rape and corn and sunflower world. Wish you an enriching day. I hope you take a lot with you and that we can show you why we are unique, why KWS is special, why KWS is strong and going strong as a seed specialist.

Thank you. Good morning, everyone. I am Sebastian Talg. I'm the newest member of the Executive Board. I started in September this year. So I'm one of the few people in this company who have very little knowledge about seed breeding. So bear with me, I have to use my cards and read a little bit and be very cautious with asking questions later on. I will do my very best. I would like to give you a little personal -- here because that is quite linked to the history of the -- or the strategy of the company itself. I grew up in agriculture. And for the last 23 years, I worked for the company, GRIMME. GRIMME is a manufacturer for harvesting equipment for sugarbeets, potatoes and vegetables. And I grew up in that company, spent 6 years in America, 4 years in China, worked in different functions, but mainly in sales and service. So mainly worked with customers all over the world, farmers all over the world, grew up into the management position and together with 2 sons, it's a family business. I was running the management team for the last 10 years. So perfect conditions, everything was fine. And now you can ask the question, why would you change? And I'd like to explain a little bit why I change. Felix Büchting mentioned already that in the next years, we will need about 60% more food. And the question is how do we make that? How do we get there? I mean, 60% more food in a shrinking arable land environment, global climate change, we all know the factors. How do we manage to do that? And when you look in the past, we've mainly -- the main growth drivers since the population was growing in the last 50, 100 years already quite high. The main growth drivers were synthetic fertilizer, chemical plant protection, mechanization, my background, and plant breeding. But if we look in the future, we have some major challenges in that way. Our farmers have some major challenges. Fertilizer use is very much regulated all over the world in the meantime. So the amount of fertilizer being available to farmers to use on their land will go drastically down in the next years. Chemical plant protection is denied by the consumers. So the consumers will not or lower -- less and less accept chemical plant protection in the future. It is also regulated by a lot of governments. The mechanization is at its limit. And like I said, I know that from my background. Today, in Germany, there's only 1% of the population being employed in -- so the most gains in mechanization have already been accomplished. So as you said, we -- I think we can be proud that plant breeding is one of the major leverage to contribute to that 60% growth of food production. And that was one reason or one motivator or the biggest motivator for me to say, I'd like to change to KWS to change from the mechanization industry into the seed breeding industry. Now I'm proud to be part of the management team of the new form part of the management team and on the other side, even more proud to be part of that fantastic team of 5,000 people spending every day and a lot of time during the day in seed innovation and trying to cope with that challenge we have for the future. Today, I'm responsible for cereals and corn, and let's look at that business unit a little bit closer. 50% of the world's food production is coped or done by cereals and corn. And I think that's a tremendous number. So I'm very honest that I'm being in charge of that very, very important section of our business. But let's look a little bit deeper into cereals. Does anybody know what kind of crop that is on this picture? I'm glad that there's not too many experts in the room then. So I just want to make sure. This is rye, one of the very success stories in our portfolio. Today, Felix Büchting mentioned we are a market leader in a lot of crops, but that didn't happen overnight. It started actually at the end of the 19th century already with the family Lochow in a small village Petkus in Brandenburg, starting to develop and starting to create well, the breeding on rye and also already on wheat. And KWS started, as Felix mentioned, in the 1920s. The Lochow family became much a later part of the KWS family. And so like I said, it's a long, long history already. In the 1955, we started oilseed rape. 1987, the success story of hybrid rye started in Germany. In 2008, we started the breeding of sorghum. And in 2014, we started looking on the grain side into North America, one of the -- or the biggest market actually. With hybrid rye, hybrid rye is not very successful, not very known in North America, but that started in 2014. In '15, we launched some new things, some new hybrid -- the new hybrid wheat system and the first soft red varieties in North America and in 2024 last year or the year after last year, we started hybrid barley, which I'll come a little bit later to because that's a very, very important step. Let's look at the big growth drivers. We have had a very successful growth rate. In the past 10 years, 9.2% so almost 10% of growth year-over-year. And why is that? It's because we have a strong portfolio. Even though commodity prices are low, our portfolio is very, very strong, and we can leverage that, and we're able to grow also with new crops like oilseed rape, which is a part of that number very heavily. You see in '24 and '25, we have a little dip in that gross history, and that's mainly because of the Russian market dropped out. And you all know the reasons why that is. So we -- with grain have no cereals, we don't have access to the Russian marketing also it dropped. Still, we have our target of more than EUR 300 million in the next -- well, between 2028 and 2030. And I think we can be very, very optimistic to get to this point. Let's look at the portfolio. Today, our cereals portfolio consists of hybrid rye like I said, success story of KWS is 38% of our total cereals portfolio. Then we have 31% oilseed rape, and that's growing very, very fast. So it becomes kind of an offset of the hybrid rye story. And as of this year, I can give you a little preview. It's already at the same level as hybrid rye. And it's a different market, as Felix mentioned, it's not cereals. It's a different market. And therefore, it's a perfect balance to hybrid rye. Then we have 15% wheat and 8% barley. And the main reason this is smaller, doesn't mean it's less important. The main reason for those 2 crops, they are not hybridized yet. So they are standard production crops, no hybridization in there. So we don't multiply the seed ourselves, and I will dig a little bit deeper into that and explain a little bit more what that means. That means that third parties are multiplying the seed. So in reality, the business is much bigger, but we don't multiply the seed ourselves. So today, we are #1 globally in hybrid rye, #2 in oilseed rape in Europe. And the oilseed rape business, we are very proud of since we are growing very, very fast on that. So we believe it's a question of years that we can also capture position #1 in oilseed rape in Europe. Wheat, we are #1 in the EU plus the U.K. And also in winter barley, we are #1. What are the main growth drivers? Oilseed rape, hybrid rye. Like I said, that's our success story. So if you ask anybody what is the big success of KWS, you will mention hybrid rye. We have 77% global market share that brings us, of course, to be #1 in that market. And with 5.3% annual growth rate, you can ask the question is how do we want to expand on that? How do we want to make that bigger? And that's a very good question since 77% is very hard to top. So our answer to that is we have to increase the market on hybrid rye. And hybrid rye is right now a good solution in animal feed, but it's not known everywhere in the world. So for example, in North America, hybrid rye, especially in pig feeding is very, very limited. And we are getting to the point that we're entering the market in North America and actually communicate to farmers that hybrid rye is a very good addition or a very good balance to wheat in a lot of times. We also look at innovation because hybrid rye and rye in general has some disadvantages. On the one hand side, it's very -- well, it's very critical to get the right seeding point of hybrid rye. You seed it in Northern Germany, end of September, beginning of October. If you seed too late, you lose a lot of capacity, a lot of potential yield. And therefore, we introduced already a couple of years ago flexible types. So you're much more flexible in seeding, so you can seed much later or even in the early months of the year, like in January, February. And that allows us to be -- to put that into a larger part of the crop rotation. And this way, we are able to increase the market by just extending the growing season basically. On the other hand side, rye is a very tall crop. Everybody who has stood in a rye field is -- you can tell it's one of the tallest rye or grain cereal crops. And therefore, our breeders did a fantastic job in developing short varieties. So short types, we call them. And the first variety for that is actually on the verge to being launched next year. So this will also kill that disadvantage of the high-growing plant because especially when you are in heavier, richer soils with a lot of manual of fertilizers being spread on that is the downside is that the rye is going towards lodging, so it will break down because it's getting too heavy. So with a new variety, we will disconnect or take that disadvantage out and really, again, make it more attractive to growers to go into this type of rye. Whole crop types and green mass types are new varieties, and therefore, we tackle markets for using the whole plant for feeding or using the green mass types, especially in biogas plants to again extend the portfolio to make the market bigger on rice. Let's look at the oilseed rape. That's a real success story and one of the strong growth drivers right now. We are #2 on the market position in Europe. We have had a steady growth of almost 19% in the last 5 years year-over-year. And therefore, we gained 7% points on the market share side. So this really tells that we have a strong portfolio in oilseed rape, and it took a long time to get to this point. We started breeding of this crop a long time ago already. And now we are at the point that the portfolio is full, that we can leverage it. There's a new -- a lot of new varieties on the verge to being launched. And one good example of how we can contribute to less chemical input, I'd like to explain a little bit deeper. This little black friend is called the cabbage stem flea beetle, who managed that. And the cabbage stem flea beetle is a big problem in European oilseed rape production since it's in a very early stage. It's going into the plant. It's drilling into the stems of the plant, and so it can reduce the yield of up to 30%. And the big downside of that is it's resistant to a lot of chemicals. So our farmers have a very hard time fighting this disease or this little animal. And the other part is that European legislation leads to a lot less chemicals being available. So we have to find answers for that. And our breeders were able to change the genetics of our input by breeding, traditional breeding. And with that, we were able to launch an innovation, which is called Insect Protect, and that reduces the infection of the cabbage stem flea larvae actually by 30% and it's a true answer to that big problem. And again, that leads a little bit back to the initial story I told that we have to cope with those climate changes. The beetle is part of the climate change problems getting warmer. On the other side, to deal with legislation, less chemical input and I think that's a perfect example how we can show that breeding is an answer to this question. Okay. Let's look at wheat and winter barley. #1 in Europe plus U.K., both crops. In wheat, we have a market share of 20%. In winter barley, we have a market share of almost 30%. So this is, again, shows how an important player we are in both crops. We have an annual growth rate of 3.9% is not super impressive. But like I said, it's a very important market. But I'd like to explain a little bit why that market can be even more important for us. And therefore, I have to show you a little bit more details, seed value. This chart is very, very important, and therefore, I'd like to take some time [indiscernible] on the left high axle, you see production in million tons. And on the vertical -- on the horizontal axle, you see the average area planted all over the world. It's a global chart. So for example, in corn, you see -- sorry, go back. In corn, you see there's almost 50 million or roughly 55 million hectares being planted worldwide with roughly 500 million tons of production. And within the bubble, it says 213 million, that's the seed value. So USD 213 per hectare does the farmer need to spend to buy the seed for this important crop. Sugar beet, you see here on the left-hand side, 283, also a high-value seed crop. And on the right-hand side, you see wheat. It's the most important crop since it's grown on more than 90 million hectares worldwide, but the seed value is very, very low. It's only USD 10 per hectare. And why is that? The reason for that is that a lot of farmers are saving seed, farm save seed, we call it, they're saving seed from the current production and replant in the next year. And therefore, the market for wheat is right now fairly small. And what we are trying to do is by hybridization creating new innovation for farmers to increase yield or deal with insects or climate change. And with that hybridization, we are able to increase the seed value for wheat. And the downside of hybridization for the farmer is that every year, he has to buy new seeds. He cannot use the seed again. But the upside is through the heterosis effect, our breeders were able to react to climate change and to needs the farmers have faster, so we can increase the yield faster. And that is the innovation we are working really on cereals on, not only on wheat, but also on barley. We believe that through hybridization in the future, we can increase the seed value. Barley, you see in the bottom is 20. We can increase the seed value of up to USD 100 per hectare. And I mean, you can calculate it yourself, 90 million hectares worth of wheat multiplied with USD 100 per hectare, how much or how big that market can be. And again, in Western Europe, we are a market leader already. So hybridization will be a huge driver to become even bigger on that. So overall, to summarize, we are in a poor position in the run for global food security in cereals. We are -- we have a broad portfolio to fight climate change and to deal with less chemical input. And we have a significant growth potential through hybridization, and especially on wheat and barley, which we will launch the first varieties in wheat in the mid-2030s. So barley, the first variety is launched already. So we are a little bit ahead of the curve. So those are huge impact drivers for the upcoming years. Let's look at corn and sunflower. I mean, we all know we live in a very changing environment on the newspaper and on the news every morning, each of us see is war in Ukraine and Gaza and Sudan. We have a climate crisis. We deal with global trade protections. We have an energy crisis at the end. And therefore, I find it very, very smart and very brave for the former Executive Board, it was a couple of years before my time to make the decision to divest from our businesses in North America, South America and China. And to show you a little bit what that effect was and how brave that decision was, I think this chart really is impressive and shows the outcome of that. In 2022 and 2023, we did more than EUR 1 billion worth of turnover with the 2 main areas. We call it GM markets, South America, North America and China and the European traditional market. In 2023, we decided to divest from the joint venture in China. In 2024, we decided to divest or sell the South American business. And now in 2025, we decided to sell the joint venture in North America. And that led to a turnover reduction of more than half. So right now, we are right around EUR 450 million worth of sales, but it made us way more robust, way less capital intensive, way more profitable than in the past, and we have a much bigger focus on the traditional European market where we can really have potential to gain market share. And I'd like to show you how we think we can gain market share in that end. Today, the annual growth rate over the last 10 years is 2%, which is truly not impressive. But putting that into perspective, the area in Europe is shrinking due to several reasons. And still, especially in the last 5 years, we were able to grow. And I found that quite impressive in a shrinking market still growing. And the question is why, how -- how did we do that? And the main reason for that is innovative products. And our products, both on silage and corn really have the potential to grow even more. And therefore, we believe that we can reach more than EUR 500 million turnover in the Western European market within the next 4, 5 years. And I'd like to show you how we are planning to do that. And again, you know this chart, you have seen this chart already, but this is a little different than the first one you saw. This one focuses on the European market, not the global market, like the one we saw before. And the bubble size is not U.S. dollars per hectare like we saw on the previous chart. This one is euros total. So for example, you see the grain and silage corn market being at EUR 3 billion total market in Europe. Again, you see at the bottom, roughly 20 million hectares being planted corn being planted in Europe. That shows very impressively that corn is the biggest seed value market in Europe. And it's split up in grain and silage. Silage roughly EUR 1 billion; grain, roughly EUR 2 billion, so 1/3 to 2/3 split up. And also, you see the other crops in that chart, and that's the reason I like that chart so much. You see wheat in Europe being planted is roughly 30 million hectares, only EUR 500 million seed market. So again, it's the most planted crop in open fields in Europe, but the seed market is only EUR 500 million. It's the same size like sugar beets in Western Europe. And sugar beets are being planted on 2 million hectares roughly in Western Europe. So that shows, again, relating back to the wheat story, how much potential that has. But again, looking back to grain and silage, it is actually the biggest market with EUR 3 billion in Western Europe. And I'd like to show you a little bit how we believe we can profit, how we can gain market share in this market. Today, we are #1 in silage corn with 18% market share. Silage being used mainly as a whole plant to -- for feeding cows or used in biogas plants. And in grain corn, we are with 10% #3 in the market ahead of us being Pioneer and Bayer. 2 big players, of course. And therefore, it's important that we being -- still being innovative or having a good pipeline to gain market share, especially on the grain corn side since you've seen it's the bigger market, 2/3 of that is in the grain side. So we believe that we can grow quite a bit. And we've seen in the last 5 years, we were able to gain market share. We were able to increase the business. Starting with silage corn. We believe that we can strengthen our leading position by innovation, and we see already we have top-tier performance in innovation coming up. Good example of that is energy boost corn. So since silage corn, like I said, is mainly used in production of milk or meat or in biogas factories or biogas plants, the methodology is actually the same. So you try to put as much energy into the cow and the cow produces milk or meat and maize [indiscernible]. So the same happens in the biogas plant, by the way. So that's the reason the systems are quite comparable to that. And we have done in the past years a new innovation, which we call energy boost corn. And that means you harvest more energy per hectare because it's a higher dense energy corn. That being launched brought us to the fact that we are kind of market leader on the silage side today. The downside of that is digestibility. And digestibility means that a cow can only take a certain percentage of the energy being fed and transfer into milk or meat. And the digestibility was always a downside of having the high energy input. It was used by our competitors to be more creative. And we have overcome that issue with a new innovation, which we call high digestibility energy boost. So we combine both innovations, high energy with digestibility to a new innovation and really that will bring us to a very competitive edge product. And we see already the first trials, especially in France, that this innovation truly outperforms everything which was currently on the market. And we are very anxious to the product launch, which will happen in '27, '28 because this will take or will boost again our position in the market and will boost again the market shares, we saw already. And again, a good example of how breeding can really contribute to less input, more output concept. So really, with this concept, we can -- our farmers have a lot less input and more output to cope again with the challenges we've talked about earlier. Let's look at the grain corn side. Grain corn, super innovative as well. We've launched more varieties than all other competitors in the past 3 years, and that shows how strong the portfolio is and will be. So over the next years, you will see a lot of new varieties coming on the market. And therefore, we believe that we can even grow our market share, which is 10% in grain, as we've seen earlier, just by the speed of our breeding right now. So we are really in that -- on the very competitive edge right now. And with that speed of breeding, we believe we can really gain on the market share side. And I brought 3 examples of that. We launched a couple of years ago already the Plus4Grain varieties. This is a high-performance hybrid on normal suitable grain conditions or corn conditions. It outperforms yield-wise pretty much all competitors in the market. So that's for standard grain production. Then we've launched a new variety or new varieties, new hybrids in the section of climate control. And ClimaCONTROL3 actually means that we are -- or this variety, this hybrid is able to cope with drought. And this is a huge factor in a lot of [indiscernible] Western and Eastern Europe also. Southeast Europe has a huge problem with climate change, and it's just raining not enough. We just talked to some colleagues a couple of weeks ago, and they actually had no rain during the whole growing season. So these varieties or those varieties can much better cope with this drought factor than -- or with drought stress than conventional varieties. And the new innovation in the run is DryDown+. And again, DryDown+ is a variety, which is an innovation which is available, especially for farmers in the northern parts of Europe, where the downside is that with cold, wet, autumns, the problem is that you are not able to get the corn and dry. And therefore, it's important to have a new variety there to -- which is called this very early variety, DryDown+ makes it easier and earlier to harvest the grain dry. And therefore, we can also create other innovation by extending the crop rotation by harvest -- being able to harvest earlier, we can again put different crops in the ground with that. Let's look at our most beautiful crop in the portfolio, sunflower. Sunflower is a fairly new crop, and we are heavily working on that, that we -- at a certain point of time, we can call this business unit not cereals and corn anymore that we call it cereals, grain and oilseed rape and sunflower. So oilseed rape is growing very much. You've seen on the oilseed rape market; it's about EUR 400 million. On the oilseed rape side, we have 60% market share. On the sunflower market, we have 1.6% market share, and the market of sunflower is EUR 1 billion. So you saw that earlier in that nice seed value chart. sunflower has an amazing amount of market. And that market is still growing. Why? It's the global vegetable oil market. And this is -- the global vegetable oil market consists of 220 million tons. 10% of that is sunflower. And we believe our experts believe that, that vegetable oil market is expected to grow by 10% in the next 5 years basically. So it's growing. We have 10% sunflower content in vegetable oil in general. And we have only 1.6% market share. That really shows that we can grow in this area. And here you can see a little bit of story of sunflower. We started in 2011 basically with the first breeding programs. Again, 10 years later, you show the -- you can see the long breeding cycles. 10 years later, we launched the first own variety by KWS called KWS Ademis. And since then, from 2023 on, we are gaining market share. Right now, at 1.6%, but looking at the pipeline and the varieties to come and the market to expect it to grow, we believe that we can grow our market share to 10%, which would mean in the current market size already EUR 100 million of turnover. Yes. To conclude, overall, my last slide. I hope I was able to show you why I made personally the change from the mechanical industry to the seed industry because I truly believe that in KWS, we can answer or with KWS or KWS can answer a lot of the questions we have concerns the 60% more food we will need in the next years. And KWS will cope with climate change and more regulation in terms of fertilizer input and chemical usage. So I believe at the end, with KWS, we don't have to worry for the future. This is really, really a successful story. And therefore, I'd like to thank you for the attention, and I'd like to hand over to my colleague, Nico Wielandt.

All right. Good morning, everybody. I hope you guys have a good breakfast. We're slightly behind schedule, but I hope we will finish on time for your lunch. I'm Nicolas Wielandt. I've been with KWS 19 years already. I'm originally from Chile. Although my last name sounds German, unfortunately, it didn't come with the DNA, didn't come with those skills. So last night, we were trying to speak in German a bit, but Spanish is, of course, my mother tongue. And I've been very happy the last 19 years at KWS. I think KWS is a company from an employee perspective that provide a lot of opportunities, and that was my case coming from Chile, moving here, taking roles starting in regional responsibility for sales in sugar beet for quite some time. Then I took over the sugar beet business unit for 5 years. So we have this Head of Business Unit. I was in that role between 2014 and '19. Then in '19, I moved to corn. I was responsible for Corn Europe. And in '22, I had the honor and the responsibility, which I do with a lot of humbleness and challenge, of course, to move into the Executive Board. And in the last -- basically since '22 until this year, I was very much focused on what you have seen from Sebastian, the divestments we did of all our portfolio of the Americas, of the American corn market. And now since July, I'm happy to be back on one side on the sugar beet part, and then also to take the challenge on vegetables, which is I would like to walk you through. And if we start with sugar beet and I brought some things that you can feel and touch, but this is not a real beet, but this is more or less what farmers will have actually harvest from a hectare of sugar beet. We have seen from Felix, we started in 1856 with the intention of the sugar industry to improve the raw material, so to make this be more productive. And you have seen we have been growing, and this is only the last 10 years, very sustainable, and this growth has been driven by innovation. We are today close to 900 million, and the intention is to go to 1 billion. And I will walk you through what are those innovations actually that make us quite confident that we will reach this target. If we talk about the sugar beet acreage, unfortunately, we're not talking about hundreds of millions of hectares like in other crops. Unfortunately, it's only 4.6 million hectares. There is about 10% and you see this orange bar is actually the percentage that represent of the total market. The U.S. is about 10%, although it's a very important market for us. We have very strong market share there, well, all over, but in the U.S., in particular. So there are about 200 million, almost EUR 200 million sales that are coming actually from the U.S. And then the rest is, of course, in Europe. So we have between EU 27, if you want or the European Union plus East Europe, we have about 3 million hectares. And then the Rest of the World, particularly North Africa, Middle East is another 1.2 million hectares. So that's today our footprint. That footprint of the crop has not been stable. So if you look back in time, the acreage actually have reduced significantly. And we were discussing yesterday that we work against ourselves. On one side, we want to be more sustainable. So we want to have more yield per hectare. But that, of course, make us producing more yield, so less hectares are needed, and there have been a lot of sugar market reforms during the time, which are now meanwhile over. But you can see that the -- while the acreage reduced from 7.4 million hectares to 4.6 million that we have today, our sales went up. So our revenue from EUR 131 million to this EUR 872 million record year we had last year. And our profitability, even more important, grew amazingly to EUR 367 million. Again, this is based on our ability to turn innovation into value. While we launch innovation, of course, we become the preferable partner for the farmers, and this has been rewarded on our market share. But today, we are close to 70% market share. This is value-based market share because yesterday, we were talking during dinner about, well, 70%, the chances to grow maybe are limited. But actually, we still, from a volume point of view, we're only at 60%. So there is a 40% in terms of volume that we can capture ahead of us. And you can see the main competitors. So the strongest competitors here now is a joint venture between our historical competitors, the [ De Pre ] Group, that was [indiscernible] for the ones who are familiar with our seed industry. and then DLF, which is a Danish breeder, which have acquired a portfolio from Syngenta. So Syngenta divested their sugar beet business, and this has been acquired by this group. And then Strube, an historical company based here in Germany that has been recently acquired by RAGT, a French breeder. And the rest are some local institutes. But today, we're in a very strong position. The market size is EUR 1.2 billion per year. This has been developed and growth, thanks to the innovation that we have brought to the market. So if we talk about innovation, I think this is quite key to understand what have been the key milestones along this process, starting with the monogermity, so that hopefully, from seed, it only grows one route, one plant. In the past, this was not the case. So it was called multigerms. So you were putting one seed in the ground and they were growing several plants. So the first -- that was the first step technically to have a very uniform stand in the field. Later on, we introduced resistance to Rhabdodemania and nematodes, which were diseases that were really affecting the crop. And then we start getting into what we call herbicide tolerance. So you have during your crop, you have non-wanted plants or wheats, as we will call it, starting in 2007 with the introduction of the transgenic Roundup Ready bits in North America. And then moving into 2018, what we call CONVISO SMART. I will go into details. So in Europe and the Rest of the World. And now recently, in 2021, a resistance to a fungal disease called Cercospora, which significantly affected the sugar beet. And actually, we have created a very interesting value in that regard. So starting with CONVISO. CONVISO was a collaboration. We founded with Bayer. So this was a joint work. On the one side, Bayer had responsibility to develop the herbicide. The herbicide is called CONVISO ONE, and we have developed the varieties that plant that actually can stand this herbicide without dying. And then, of course, the rest of the weeds are being eliminated or removed from the field. And that really brings a lot of convenience for the farmers because the classical or the former way of managing the field require that the farmer needs to go with the tractor 3 to 4 in the field. And of course, they have families, they have other crops, et cetera, have to go 3 to 4x. And in the right moment to spray it is a tough challenge. So with this, we introduced a lot of convenience for the farmer. And as a result, you see you can manage the weeks much better. And that, of course, increased the yield as well. So this innovation has brought a lot of value. I will come into that now. You see here a little bit of the map on the adoption of how CONVISO SMART has been penetrating the market. So today, we are above EUR 300 million sales varieties which contain this technology. So not all the value is only on the CONVISO part, it's also on the genetic. But the 2 things combined, we have sales for EUR 300 million. And this year, we actually expect still another growth of about 10% in terms of value on this technology. And as you can see as well, the penetration is still not reached its peak, more value to come on CONVISO. And this has been driven by the registration of the herbicide and certain regulatory aspects. So we couldn't launch all the countries at the same time. So there are countries which are quite advanced and others which are still in development phase, but I expect that still we have another 2 years of growth, at least on this product. And this -- we still need to have other chemistry. So that's a requirement. We still need to have basically something to combine with CONVISO, especially to manage with resistance. So if you only spray the same product all the time, with time the weeds actually do not get controlled. So it's very important to have other alternatives. But at the same time, as we have heard from my colleagues, the regulatory framework from pesticides of all means is getting tougher and tougher. And actually, many of the classical herbicides that used to exist in sugarbeet are not available anymore. So CONVISO has become really a fundamental solution for farmers today in Europe. Okay. I will move to Cercospora. Cercospora is a fungal disease. And basically, you see the impact of disease is quite significant. So you can have 50% of losses because actually, what it does it destroy the leaves, you see there the leaves get necrotic, the leaves die. And as a result, the roots start growing new leaves and that takes the sugar out. What we want to do at the end of the day is that the farmer harvests a bit full of sugar. But if it all the time, the energy is going to grow new leaves, of course, you lose the performance of this crop. And this has been KWS innovation, which we have launched and that actually really balance or limit the damage of this disease. The penetration as well has been much faster. This has been really a very strong successful story. I would say here, we have really reached in most of the market a certain peak. But nevertheless, today, we're close to EUR 250 million of varieties that have this technology. And the best, of course, of all is when you have a variety like this one, which is basically a combination of both. So you have CR+ and CONVISO SMART in one product. And this has really boosted the sales. So today, we have -- if you combine both, we have about EUR 500 million sales of varieties either having CONVISO, Cercospora or the combination. And this has really been a great story of innovation and how do we bring innovation to the market. And as I think Felix mentioned at the beginning, we're capturing value from the chemical industry into breeding. And this is really a unique opportunity as a seed specialist that you can reduce fungicide applications, so less fungicide and more value into the seed into the breeding pipeline. And you might wonder, okay, what's next? Is the story going to continue? And yes, it will continue. We're investing about EUR 100 million per year on breeding, and this is super important for just for sugarbeet in order to keep a pipeline of products coming up. We know these technologies do not last forever. So you need to think on successful products. On one side, we have digital tools to manage resistance, so to tell the farmers when is the right moment, for example, to spray, so they have a better efficacy. We are about to launch a triple stack of herbicide tolerance in the U.S. I said in 2007, we have launched the Roundup Ready system. So glyphosate apply on the weeds with time and especially in the U.S., the farmers are basically growing everything under Roundup. So they only spray the same product. And that, of course, with time, creates this resistance. And we have started this project in 2014. We have signed the agreement with Monsanto. Monsanto give us the genes. We do the transformation into the sugarbeet and then we're ready to launch it. The launch will come in '27/'28. So you need to think on how long it takes really all these developments, but we're quite excited. At the same time, we have virus Yellows. I will go into that in detail. And a new disease that has shown up, I think you were asking me yesterday, the situation is a disease that emerged now because of the ban on the neonics, and we're also having solution for it. So as I said before, the new generation of herbicide tolerance in the U.S. is called TRUVERA, has 3 mode of actions. Farmers are really, really looking forward to it. The main reason why we cannot launch earlier is due to regulatory aspects. So some of the byproducts of the sugarbeet like the pulp, et cetera, which are used for animal nutrition is exported. And until all the regulatory frame is, for example, in Japan, in Europe, et cetera, is not done. We'd rather start small, knowing that basically everything we harvest will stay in the U.S. but we expect that after '27/'28 and the years after the regulatory package will be ready, and then we can really go into a more broader launch, but that will be the start. So this is really something that we're quite looking forward. I mentioned before, the ban of neonics have increased the spread of an insect, similar concept of what Sebastian was mentioning before in oilseed rape. The good news is we see variation within our portfolio. So that tells us already, okay, we can tackle this problem through breeding. At the same time, working very closely with the sugar industry, we have found ways on when to spray. So when is the right time to spray certain insecticides to control it. So this is really a joint effort in order to solve a problem that is -- was becoming a big concern. And luckily, we are getting quite good results already in a relatively quick frame. Similar with virus yellows. Virus yellows, again, this was also transmitted by aphid, a small insect. And basically, with the ban of neonics, which we used to put in the seed treatment, the plants become vulnerable to this attack of the aphids and they transmit diseases, in this case, a virus. And we have started already quite early a breeding program for virus yellows that actually without having the insecticide will give us a quite good level of resistance. And we're planning to launch the first generation in '27, '28. And that's, again, a way of how do we capture value that used to be in an insecticide, we bring it through the breathing material to our varieties. So in short, we have very good news. We have a very strong pipeline of innovation coming up. So I said we have TRUVERA, the next generation of herbicide TRUVERA for the U.S. about to be launched and the virus yellow varieties. We have an ambition plan to go to this EUR 1 billion sales in the near future. And of course, the objective is to maintain and to keep the profitability as we have done until today. So changing gears, now we're moving to what we say the build. So what are we really going to grow in the future. These are long-term bets, very long-term bets. On one side, we have vegetables, potato and the KWS food ingredients. I will start with vegetables. It was mentioned, we have done an acquisition in 2019. We have acquired Pop Vriend. And why we did that? Why we did the step into vegetables. On one side, as Felix mentioned, we believe in having a more balanced and sustainable portfolio, also following what are the market trends, what are really the needs in terms of consumption per capita of more vegetable products and the population growth that has been already mentioned and described. And to give you an idea, if we talk about the global market size in terms of money, vegetables is about $7 billion. But of course, within this 7 billion, there are a lot of different crops. And within the different crops, there are a lot of different type of vegetables. So you can find the store today, multiple type of tomato, you have the big tomato, the small tomato, the long tomato. So every single crop within vegetables can be split in another segment. So where are we today? So when we have acquired Pop Vriend, the sales actually at that time were high. We did some divestments of crops that didn't really fit to what we wanted to develop. So for example, carrots and there were a few other crops that we were not really interested to keep mainly due to the profitability and complexity. Then came COVID and COVID for us has a significant impact because a lot of the sales we do today are in the spinach, this baby spinach, so the leaves that we eat in the salad. And one of the main drivers are the restaurants in the United States. So when COVID came, people didn't go to the restaurants. And that, of course, triggered a drop of market, which took about 2 years to recover. We're quite happy. We see now the trend in a positive direction. And the aim, of course, of the overall business unit is to achieve $100 million from here until 2030, but we don't stay only there. So the long-term ambition is really to go to EUR 300 million. Why we step into vegetables? I mentioned the sustainability aspect and the other one is, of course, very important, the profitability one. Vegetables in general are crops that offer EBITDA in the ratio of 20% and more. So very similar to what we would expect in Sugarbeet, for example. There are smaller niches. We think we have a very good opportunity to enter this market because there are different segments, so we can choose our battles. And we have, and you will learn in the afternoon when you do the tour to research that we have a very good base from a research point of view to support different crops. So this has been the key basically to put the engine we have here of breeding and research to serve other crops, which offer higher profitability. The market that we are targeting, and you can see the first 4 crops is basically what we have acquired from Pop Vriend. So we're talking about the Swiss Chard, and spinach. And then the next 5 are something that we're starting from scratch. So we are breeding really organically. That means we're basically carrying a backpack of investment for a few years of products that we still do not bring into the market. The market potential of all these 9 crops is about EUR 3.9 billion. So half basically or a little bit less than 1/3, if you want, of the total potential of the market. And the first step that we have done is really to set up the infrastructure, mostly connected to research. So where do we do the research for the local market. So we have opened stations in -- starting from the Americas, in Brazil, in Mexico to build -- to breed those crops. Inside Europe has a very important, of course, footprint. Spain, Murcia and Almeria, in the Netherlands, where we have the original acquisition from, Pop Vriend, Turkey and Italy, of course, are also very important market. So the first step has been also to build up the team, to build up the infrastructure. And actually, we have been -- we're quite happy that we are already in all these 5 new crops quite active. If we look in more detail, Spinach, Spinach is still the main driver of the sales. So from the EUR 72 million you saw, basically where EUR 48 million are coming from spinach. We are market leaders in spinach. So we have a market share of about 38%. There are different type of spinach. Our strongest footprint is in this baby leaf, as I said, for the salad, but we're targeting the other segments, too. Profitability, super important, is delivering more than 20% EBITDA. So this is confirmed. So the acquisition is responding to what we have planned. Similar story with beans with a little bit smaller market size and still smaller market share. So here, there is also opportunity to grow. And especially, we see that we have the opportunity to grow in the fresh market, especially for the U.S. At the moment, we have about 18% -- sorry, EUR 18 million of sales, 19% market share. And we see here, we still have an opportunity to develop. And actually, there is a pipeline of products that fit new markets for us, which make us quite excited. Last 2, the smaller from the acquisition, Swiss Chard and Red Beet. And what is the cool thing of the opportunity we have with these 2 crop is exactly the same specie as Sugarbeet. So as I said it before, in Sugarbeet, we're putting EUR 100 million research. Of course, we will never put EUR 100 million research in these small crops based on the market size. So Swiss Chard is only EUR 14 million and Red Beet is EUR 40 million. But nevertheless, we can use all the technology because it's exactly the same species that we have derived and developed in sugarbeet into the service of these 2 crops. So here, we really expect that we'll be able to get market share and presence relatively fast. So at the moment, also our current starting point in Red Beet is 4%. In Swiss Chard, we're a little bit stronger. So we have 20% market share. But as you have seen before, in sugarbeet, we have 70% market share. So there is room to develop and to grow in these 2 areas. It has been mentioned also by Felix, the approach of these 5 crops should be delivering this pipeline should be delivering now in the upcoming years. We have -- I don't have it here, but actually watermelon, we already started in Brazil. That was -- went faster than we have foreseen. So we have the first varieties already sold there. And we are starting now with tomato, and then we will start adding melon, again, more wider melon pepper and cucumber. So this is -- all the products should be delivering within the short term in order to reach that target, as I said before, of EUR 100 million sales. Now I will switch totally the gear and moving to potato. And potato, actually, what you see here is what we call true potato seeds, and I will maybe give you the chance to experience that. So what I have here is about what you will need to plant 1 hectare of potato. I will pass it by. Don't drop it, it will be nice. But -- that's basically -- that will replace 3 tons. So if you think about 3 tons, imagine here, there is a cubic meters times, let's say, 4x. So that's really what you're replacing with what you have in your hands. There, the 2 challenge on one side, the crop today is tetraploid. I won't go into a genetic class, but we're bringing it from tetraploid to diploid. What is the advantage of that? And at the same time, we're creating hybrids is that you're able to introduce resistance to different disease, just like we do it in sugarbeet. So you will be able actually to -- for example, one big disease called Phytophthora, you will be able to introduce innovation into potato much faster. We decided not to do this alone. So we started with a company called Simplot. Simplot is a U.S. family-owned company. Maybe you guys have heard about it. These are the biggest suppliers of McDonald's. They have recently acquired Clarebout, a very big French fries processor in Belgium. And the owners got Simplot, he said, hey, we really want to do something with our raw material. So that reminds me the story, the same what we did in sugarbeet or what the sugar industry said in 1856, we want to make something with our raw material. I really believe that we are in the starting phase of a really big change regarding the crop. Of course, it required that farmers instead of planting a tuber, will plant a true seed, and you're seeing there it is very small. So it's a long process to get there. It's a lot of technical things we need to solve, but actually, we're making very good steps. We are focusing on french fries and crisps. So these are the industrial segment. That's why the value is not the full potato world. It's just a part of it. The main reason, these are the ones that have very clear breeding targets and where the highest value is in. So we can -- with that, we can really drive the innovation. With time, we can also go into the table potato or the potato that you will eat at home for other uses. But the main focus has been really on this high value. So a lot of sustainable -- sustainability aspect, of course, you don't need to store it. There is a lot of sanitary aspects which are improved. So you don't transmit many disease through this true potato seed compared to a tuber, which has a lot of water and is susceptible to diseases. So we are really here -- I'm quite excited. I think this will be a huge innovation. We have started this in 2018, this joint venture, although our program already started in '11. So we have been quite some time. We still have -- after 2030 is when I think you will start seeing us going with the first products into the market. So still a way to go. But nevertheless, the EBITDA in this case is similar to what you can see on sugarbeet. So it's going to be a very interesting product for KWS. And last but not least, this was the top of the pyramid that was shown by Felix is about using our breeding innovation to change trades for consumers. In this case, we're talking about pea. I myself drink normally only plant-based milk. And the example here, we have already a collaboration with VLY to make basically milk with a better taste and being able to find varieties of peas that actually have better taste. And this is really a way for us to integrate ourselves in the value chain in a food producer value chain. We're starting. So this is really a first kind of exploratory set of projects and products that we are delivering. But we think that really have that power of actually changing things all the way to the consumer. So putting the things altogether, we're really very much excited about the vegetable position, I think that will really bring KWS into a very profitable and sustainable segment for the future. All these products that we are organically producing today will start delivering within the midterm. Potato, I hope you guys will have the chance to see it on the field. I was this year in Idaho seeing this true potato seed already planted in the field and it's really overwhelming, I would say. And we will really disrupt the market. That's -- I'm quite convinced we will be able to do that. And last but not least, this opportunity to breed traits for the consumer is really something that is an untapped basically opportunity we have. And I think we are in a very good position actually to make use of our breeding engine to provide added value all the way to the consumer. So with that, I will hand it over to Peter and -- looking forward to talk to you at lunch. Thanks.

So thank you, Nico, and we are perfectly in time to go into the break, and this concludes the first part of the day to day. And for those who are joining us via the webcast, we will be back at 02:15 with the second part. And for us, I would like to invite you... [Break]

Okay. Welcome back, everybody in the room, everybody online as well. I hope you had a refreshing break and got some inspiration by technology. And I think it's, for me, the pleasure to build some bridges between the business and the tech that you've seen here today to show you how we drive innovation at KWS. But before jumping into it, I'd also like to start on a personal note. And I can tell you, I'm a bit more than 4 years with KWS in the role as the Head of Global Research, and I've worked 22 years before BASF and Crop Protection Research and Trade Research. And I can tell you, when I joined here at KWS, the first thing that I noticed was the different kind of people and the team spirit that we have here. We really have some people here that want to roll up their sleeves that shows some agility even when it comes to change. I see a remarkable difference here. And speaking as a head of research, knowing that innovation is always about many people having to work for a common goal and knowing that the people need some inspiration as well and a positive atmosphere. I feel this is super important. And we see this actually as a key differentiator of KWS in the market of competitors that we have around us. So with that little prelude, let's go into the topic of innovation. And to start with some definitions from research. We like to do some definitions first. What is innovation about in our business here. I think you've heard already a lot about it. First of all, it's bringing reliably and sustainably good new products to the market and generate some value for our customers and have some share of that value with us. Products in the market first. Second, and you've seen a little bit of that. It's about efficiency increase and how we do our processes, how we can speed up the things, how we can take costs out, become more efficient in our innovation processes. And third is technology awareness, becoming aware of what's going on out there and jumping on opportunities that are coming up. And I'd like to frame a little bit the picture around these 3 dimensions and take you on that journey how KWS is innovating. And I'm just picking up that slide shown by Felix already before, and that is our retrospective in terms of pipeline that we have delivered over the last years. And the first message here is already a repetition of what you've heard already. We think in decades. We think in long term because breeding innovation is in itself a long term process, 10 to 12 years typically from the first cross to a new variety reaching the market. And that is, by and large, because we cannot help, but the plants need the time from growth in the earth to set some new seeds. That is the biological limitation. Everything else around, we can influence, and we try to influence where we can, and that is part of the story. The other part that you see is that we are talking about key innovations here that are in the most aspects traits, that are new features. We've heard about it herbicide tolerance, biological tolerances, resistances to fungi, insects. We have seen all that already today. And you see hybrids. Hybrids is another big topic, which I also like to give some insights on. And that is not even the full picture because the core of the innovation is a very steady stream of incremental performance increase in our varieties. And what is most important performance for the pharma, yield, of course. And I would like to shed some light on that in the first place to understand how our innovation engine works. So that is a picture of our whole crop portfolio, 24 crops. And you've heard that we are embarking just on most of the vegetables, which are new. And you need more breeding programs to cater that because, for example, you've heard in corn, we have silage and we have grain corn. These are 2 different breeding targets that need to be catered by different breeding innovation processes. And when you then look into the differentiation that you have in some of the vegetables like tomatoes, small, big cluster, tomato for pasta sauce, some for fresh markets, we've actually have a fragmentation of significant size, and that fragmentation also needs to be built up in the breeding process. So you may ask, wow, that's a big portfolio. And I think we have heard it is a pretty unique broad portfolio in the industry. How does that make sense? I mean, from a business perspective, we have already heard it. Chances and risk balances in different dynamics of different market segments that's helping. From an innovation perspective, here, you have one of the core messages I'd like to convey to you today. And that is, actually, breeding is a very fundamental and a very similar process from crop to crop. You all know it, what is breeding at the end, crossing 2 plants and selecting for some positive outcome. And that is very comparable in the first place. I don't want to play it down, but because there's a lot of knowledge involved how to do it actually good and fast and reliable. But in essence, it is very comparable. And it's also very scalable. Actually, you can calculate how many output you will get over after a couple of years when producing a certain input of numbers that you put into the system because behind it, there is a lot of pure science and pure predictability. So I think the message I want to convey here is that the core breeding innovation engine in the first part is very reliable and stable and very predictable in a way. And that is the reason why the output of this innovation engine is very predictably. And you see also looking back in decades, year-by-year, how many varieties has KWS gotten approved by a variety of approvals in the authorities overall. You see it's more or less a constant increase, and that is about the reliability of this engine. Record high of 584 approvals in the last fiscal year. Of course, a substantial spend in terms of research input. But I think there are some industries out there which would envy us for this kind of scalability that is in the process. But this is not the whole story. I'll come to some more challenging parts of that in a second. You see also that we have about 1/3 of our employees engaged in that, a substantial commitment and that the general output of that for the farmer is an annual yield increase by 1% to 2% that we deliver. And just to be very clear on that, the process of variety approvals in most of the markets is a super objective one. Officials do tests with our material -- with our competitors material and compare it against. And only if you really have a better performance of an existing product or -- and it needs to be different, too, then you get the approval. So it's a very, very tight measure of innovation, what we see here. That is why I will not talk about the breeding process for the rest of the talk but focus more on what we do on those step change innovations on traits. And this is just a summary of the presentations of the colleagues in the first part where you see the anticipated product launches that we have planned for our crops. And we see again, we have traits like the digestibility you've seen, TRUVERA as a second-generation herbicide tolerance and all the kinds of resistance traits in between. And you also see that we want to launch hybrid barley as a new product that we get and the vegetable products, which will come totally new to the market. So looking back as well as looking forward in the next years, I think it's proof that we have a pretty solid and reliable innovation machine that we are actually running. So looking a little bit more on the traits end and to give you a little bit of a feel for what that means in terms of scale and efforts. again, maybe starting with the definition, what is a trait and you've heard it here and there. We offer special features and performances to the farmer that give an added value to him. And then we share that value in the seeds. Often, it is actually reducing input costs. It is kind of herbicide use, fungicide, insecticide use, agronomic properties that includes fertilizers as well as other features in the plant. So actually, we help to do more with less input and that's an economical benefit, not to speak about the sustainability aspects of shifting from chemicals to [ seed ] value. You also see that sugar beet is our biggest traded crops and we have already heard that there is a relationship between if you can really deliver innovation into traits that can deliver market leadership. And you see the other here as well. And when we look from that perspective of that portfolio, you often see in innovation-driven companies something like pipelines like this. And on a very high level, about 1/3 is very close to the market and 2/3 is not so close to the market. That's not an important message. The important message is behind that picture. And that is, if you compare this innovation pipeline with other industries, let's say, agrochemical, for example, then the question is where is the biggest risk. And for agrochemicals, a big substantial risk is still in late phase. You kind of have already spent millions into a new chemical and it hits a toxicological or whatever wall and you cannot market it in some markets or get -- lost it totally. This is totally different in our case. The biggest risk is actually here at the very beginning. The risk is just to find the trait, find the genes that make up the trait. Once you have identified it, everything else is classical breeding and bringing it through. I think it's a very important message because sometimes you look at risk and kind of reliability of innovation and we have a very reliable innovation pipeline there as well. So we could say at this point in time, everything is fine. We have a very good solid base to do our stuff, demonstrated by the successes in the last years. What's the biggest risk now? The biggest risk is complacency and limited foresight. Who of you still has a cathode ray TV and is not using display panels? Technological innovation, display technology, EV, electronic cars versus classical combustion engines, innovation in battery technology. And who would doubt that generative AI and AI as such will drive industries, also our industry in the future. So what I want to say is the foresight, which is core of -- one of the core values of KWS, it's very important to stay in the business, even if you have a reliable innovation engine of that kind. And that is why it makes sense to look into breeding from the first stage where human kind started crossing and selecting for better performances. 10 -- 1000s of years, this worked very nicely. Until in the mid-1880s, a monk in the Czech Slovakia has identified how this thing works in plants. He identified that what you actually see on the field is actually the results and correlated to a building plan inside the plant. And that building plan, we all know today are the genes and the genomic information that is the construction code. And in the decades after that, we have learned to read this and to use this information. And that was basically the kickstart of a big technological innovation. And if you missed out as -- in the industry, you could be lagging behind very quickly, although innovation time lines are long. And the new kids on the block are genome editing and genomic selection. Genomic selection is the marker-based technologies that [indiscernible] has talked about for you today. So let's go a little bit into this and summarize it on a sufficiently high level. What are the 4 key innovation drivers for us as KWS and I would say, in the industry overall. Marker and genomic selection, genome editing, it's a little bit newer, crop hybridization and basically AI-driven data science. And you see they are in different level of maturity with marker and genomic selection, you have seen throughput is the most mature. Genome editing is the new kid on the block. Hybridization, we are very good in but we are still going for more and AI-driven breeding is then the future innovation wave to come. So I'd like to go through those with you a little bit. So starting with genomic selection. And you've seen what our people are doing there. The principle is take a little sample from the plants like here, cutting out -- a punch from a leaf, extract the DNA and look at that marker map that is inside there because these markers tell you if a trait is there or not. And then you don't have to necessarily wait until the plant goes in the field and shows the properties but you can actually deduce it already from that digital information that you have gained. So it's an efficiency increase and one because you can save on doing field trials and it's a way of accelerating parts of the progress -- process to market. And therefore, it's a process which has after, let's say, 15, 20 years of ramp-up, entered into a phase of scaling, we are only scaling. There is nothing technologically super new about it anymore. We know how to do it. You've seen the chips. They are loaded with samples and scaling is about reducing cost. So we are not talking about fancy technology. We are talking about really strong innovation by scaling cost. So you seem -- you see in the gray bars, we are doing more than 800,000 samples by year. So we test 800,000 genomes in the plant per year. And the cost per sample of doing this have at the same time halved and we are on a further journey by scaling effects and making that bigger. That is the result of the robotics that we have seen. So a very mature technology delivering extremely well to our processes. Totally different story, genome editing or also known as new breeding technologies, NBT. Big in the public awareness and debate, I would assume that everybody knows that there is something going on. And why is that important? What's so special about this for us as breeders? And that is it's because it's totally different from breeding but delivering the same results. What's different? Breeding is a shotgun approach. You basically put a lot of diversity in there, go to our [indiscernible] and get some genetic diversity and screen in the field for the properties and maybe enhanced by genomic selection. Genome editing is the total opposite. It's like a laser sharp scalpel where you can say, I know which gene I want to have introduced or changed in the plant and you do it in a single step, straightforward, super precise, super targeted and therefore, in itself, very fast relative to continuous screening and breeding processes. So speed by precision. That doesn't mean that you can change the whole breeding approach in the future with that because what you need to know is what to actually change and that is where the knowledge and the precision then comes from. But overall, it's speeding up in the cases that we can use it. We have agreed on an improvement by 2 to 3 years but nobody knows today because we are still not using it in full steam, delivering product to the market but that's the best estimation. And I can tell you from a technical perspective, there are examples, Nicolas has mentioned potato, which are basically impossible to breed today, breeding progress is super slow in potato because of genetic complexity. Genome editing in potato is a super powerful tool to achieve things that classical breeding can't. So the bandwidth of achievement by genome editing is very broad. And KWS is very well positioned to genome editing because we have -- we are running a research center in St. Louis with about 50 people, which sole task is to develop the technology platform and put the first trait developments for future products in place. We have technology access. It's a very new technology. There's IP around it and that needs to be taken care of. We have all the tools in hand that we need to do this. And by establishing the platform, we are already generating own IP to solidify our technological position. And all of this goes mostly hand-in-hand with some strong partners that we have and that we use generally in innovation in our industry. So this is -- maybe one more thing, breeding is a method that is very standardized. You cross plants and get something out. Genome editing is not. Genome editing is actually a very plant-specific approach where you have to develop those technologies for each crop differently because I always say, in the field, every plant does the same, in the lab, every plant is a diva. They want to be treated with special care. So that is why technology development effort for genome editing is a little bit on the higher side than as compared to plant breeding. And when we look at the time line, there's 2 important messages for you here. First, it's about that thing that I said, have the foresight. Actually, the first reports of crop plants actually that they can be edited were in 2013. And 2 years later, KWS started with the GRC in production and building -- having that lab ramped up and going live. So that shows you that at that time and it's well before my time joining the company, there were some decisions that had the foresight and were courageous because at that time, there were still many questions open, can it work? Will it actually be delivering to the market? And actually, the second question is, what about today? How do we get the products to the market? Because I hope most of you know, genome editing plants are currently in Europe still treated as genetically modified plant. And that's a [indiscernible] word. Nobody wants that. No consumer likes GMO plants and the regulatory hurdles and the efforts that you do and have to spend in money to develop plants as GMOs is just prohibitive. Currently, that is still the case. But there is a super active and as we speak, actually in the European legislation, people are talking with each other. We have the so-called trilogue of Commission, Council and Parliament talking with each other to find a compromise and have a regulation that is much more favorable of developing those plants in Europe. And that sounds like a European problem but it is not because from the GMO plant debate, we know of the situation, we know. For example, our TRUVERA sugar beet, it's a GM plant marketed in the U.S. In order to do this, you have import approval from a regulatory side in Europe for the produce actually coming. Even the sugar needs to be -- so we needed to make sure to say, hey, there is no genes in the sugar and whatnot. So the regulatory hurdle even for products that are produced somewhere else are very high. And therefore, it is -- basically, this is putting the plug out of the can and the whole thing will fly. And that is also the basic principle how KWS approaches this. We are basically ready to bring the products quickly to the market once this door opens, and we are very confident to do so. Why are we confident about that? That is mainly because KWS is in a super middle position between the big companies, which are happening to be agrochemical companies, not only seed companies and the very small breeders, which basically cannot afford using those technologies. So we're in the perfect position to be a trustable, reliable partner and we are influencing in these discussions and help showing the value of this technology to the public. Now that is all about the technology itself. What are we actually doing today? So we show you here the portfolio of genome edited trait development products that is very resembling to the overall trait development picture that I've shown you with a strong focus on biotic resistance, fungal, virus, insects, agronomic qualities and a little bit quality and herbicide. Why should it be different than our breeding portfolio? Because it's basically just another technology approach to get to the same results. So we would expect that this portfolio looks the same. And the other number, which we are also a little bit proud of is that the summarized value of this portfolio of activities in terms of a net present value is EUR 270 million that we want to realize in the next years to come, with the first -- with the ambition -- plan to have the first products launched very, very early in the next decade. And I just show 2 examples for you to just show, hey, there is something in the pipeline without going into the detail, obviously. And you have heard that critter already, cabbage-stem flea beetle that is a part where our InsectPROTECT product line that comes from classical breeding delivers already that 30% that Sebastian has mentioned to you. The 30% is relatively low if you compare it to chemical solutions, which usually are 100% solutions, right? So there is air to breathe and room to grow. And in parallel, we use genome editing to test genes to add something on top. And here, we have the first genes in hand where we see up to 50% saving of plants, so less feeding damage in our assays. And we are very passionately now pushing those genes on top of the initial plants directly in to find the next generation of solutions for cabbage-stem flea beetle. And 2 more to share. You've heard about sugar beet diseases virus yellows and SBR. We didn't dare to spell the name, syndrome basses richesses, say that 3x faster, it's really a tongue breaker, syndrome basses richesses is one of those upcoming new diseases that are shifting pests coming to the northern, more cool areas, Southern Germany, even middle Germany, sugar beet areas are now infected. It's coming so fast that even academia didn't have a big chance to understand this disease. We know the principles already. It's 2 bacteria doing something, and it's actually coming together with another disease, which is called RTD, super complex stuff. But here, the point is that genome editing can help to test and understand the disease very much from the beginning and then deliver some solution on it. So it's very complementary, again, additive to what we do in classical breeding to deliver something. And virus yellows is a very similar story. I save us some time going there. So that's technology-wise on these genetic technologies. Next level, I'd like to talk about digitalization a little bit more. And -- oops, that was the wrong direction. And I'd like to start with a product dimension on a product that you have already seen. We have our CONVISO SMART product. And here, it's actually already a double product with other traits stacked on top of it. If you look to the package, it's Cercospora Plus as well as rhizomania and nematode. So it's actually 4 products, [indiscernible] product and 3 traits in there, plus you see a sticker here, like KWS, that is our digital platform that we entertain and the farmer can find a useful tool to help him with that system in the field. In a few words, you've already heard from Nicolas, you have the seeds which are resistant, plants against the herbicide and the herbicide in one package and that gives you a very strong yield -- sorry, weed control solution in the field. The caveat is that you have to spray the herbicide at the right point in time to get the full boost of only using 1 or 2 herbicide applications. And the timing of that, the window is relatively narrow. If you spray too early, then the weeds have not even all come out of the field and you have to spray a second time. If you spray too late, the weeds are too strong and you need to spray a second and the third time because they are too strong already and withstand a little bit the herbicide. So the timing is very important. Now the digital tool behind this is simply a mobile phone app that the farmer can download. He makes some pictures of the weeds and the tool understands the size and the timing and makes a prediction on the timing when to apply best, to have that best opportunity of the product performance. So it's actually another product stacked on top of the pure seed that we have given them. And that's a little bit the strategy here to offer farmer complete package solutions in a sophisticated crop like sugar beet. But talking about digitalization is an -- there is another dimension. And that's the same dimension I've talked about with the genetic technologies for you that is efficiency increase, speeding up in our innovation processes as such. And here's 3 examples, 2 of which I would like to go a little bit into the detail. The first, what you see here is an aerial view of a breeding plot of some, I guess, it was cereals, it's too low of a resolution. But actually, a plot is a stripe like this finger. It's always one -- different varieties in the field. So we have lots of those in the field. Overall, roughly, at about 45 breeding stations that we have, we have 2 millions of these plots per year in all our crops. Some are bigger, some are smaller but it's a huge number. How do you do the logistics for that? How do you plan those field trials? How do you translate the wish of the breeder, I need these and these things into the practical reality. And to do this, our IT folks have developed a digital twin, basically a field maps in the computer where you have these plots and you can plan the activities in the computer. And then as a next step, it's going to the stations. And at the stations, they put the seeds on a seeding machine and the seeds are put with GPS precision into the field. And that's a GPS precision of 3 centimeters. It's not your car GPS with 20 meters or 100 meters. It is 3 centimeter of precision. So we know exactly where which seed is, where which plant is and we can map all the environmental data and all the evaluation data on top of it. This is a little bit of a techy story, I know but take home is, this is not something that you can buy. That is something that is so special that you need to do it on your own. And we have the capabilities and the teams to do that. And here, I have a little of those hand-on objects for you, which are obviously KPS -- KWS, as you see by the color. To explain this one, who has recently bought a robotic lawnmower of you? None? Okay. If you had, it comes always with a second device that you put into your garden to increase GPS precision and let that little thing run precisely through your garden. You can buy that today for this -- but this has been developed about 7 years ago and you need this on the field to have that GPS precision. This thing here, please just don't fill it with the buttons but you can hand it. That has been developed by our digital teams. There is no external company involved in that. I personally was super impressed when I saw that joining KWS, it's not only breeding and dealing with seeds but there's actually teams of engineers, small teams that are developing those things. There's a little raspberry pie in there and a bit of software and they 3D print the things and off we go. The second is, this here, what's that, a little numpad, very simple device, you can hold in your hand and you put in data. It's connected via Bluetooth with your mobile phone. Why is that good? Have you ever tried to stay in the sun on a field, having your digital app and putting in some numbers? Nobody likes that. That was the feedback that our digital guys got from the field station saying, it's nice and we can enter all the data but it actually is very cumbersome. Can you help us with that? And now they go around, print these things, costs EUR 50. And while having the database and their phone in the one hand, they can basically touch, feel and make the rating at the field and so on. It's a nice example for me how passion and how good colleague yield interaction leads to very simple things which can make a big difference in our innovation process. So that's the FieldExplorer story and there's many more tools that we develop for that. And I will go one step back because the second example here in the middle is, if it starts running, it's a little bit this kind of video thing is, which always go wrong when you do presentations. So maybe like this, yes, now it works. So basically, you're standing at the edge of a corn field here. And what you see is a harvester machine in the breeding plot passing by the rows. And you see an AI run time seeing where the corn plants are, where in red, the crops are, the ears are. And it measures the ear height, which is a very important breeding parameter. It also measures plant height and it's all run, run time AI. So by harvesting the machine collects the data to put to the database and have as information for the breeder making some decisions. And the whole machine looks like that, big mess of wires and optics and so on but it's even past the prototype status and it's a home innovation approach with lots of passionate people doing this stuff because we need it. And that is, again, something which you cannot buy anywhere from the shelf. So getting close to the last topic, this is just a headlight on AI. I would say there's 2 kinds of AI. The one thing that everybody already uses today, which is kind of having your pictures in the phone and make -- let them see, oh, it's a cat. Actually, you can Google the cat then. Great. For us, this -- the equivalent is what I've just shown you, image data recognition. We use drone to fly the fields and digitally capture the data, things like that. And we use these kind of AI models a lot. The other next-generation thing of AI is generative AI and that is making use of deep data sets that we have. And here, we are just at the beginning. And that is why I put this as the youngest part of innovation in our pipelines where we have to gain a lot. So we have a very good base, good starting point but there is still room to grow. And just to complete, we are not shy of including other data sets like public data sets, satellite data shows you the temperatures in the field, the weather and so on and integrating it into our things. The higher-level message here, collaboration is key. It's not only true for digital. It is actually one of our core elements that we go with academia, with start-ups and use a lot of that knowledge in all kinds of innovation features. Coming to the last topic. We are good in time. I know it's a lot. So bear with me, just 10 more minutes. Hybridization, you've heard about hybrids. Why are hybrids good and important? We have heard some of the stories already. If you do a Sunday walk through the fields in summer and pass a corn field and some other fields and you compare the corn field, what you see with maybe a barley field that is just at the other side. The main difference is that the corn is basically standing there like soldiers on a road. It's super reproducible, like all of the same kind. Barley, it's a little bit more dynamic, a little bit bigger, a little bit smaller and kind of thicker, thinner stems and so on. There's a little bit more variety in that. And that's one of the features demonstrating that corn is actually -- it's a hybrid, that a hybrid produces more reproducibility, less variety and more vigorous character. It actually produces more yield. And it's also a way of introducing traits and we have heard already before, from a breeding perspective, it's nice because a hybrid can only work one time in the field and then the farmer has to buy a new bag of seeds in the next season. So breeders love hybrids. They love to sell hybrids but to make hybrids, it's actually much more cumbersome than normal varieties. And it's a little bit techy but I think some of the principles need to be explained to get a feel for it. What is a hybrid? A hybrid is basically 2 breeding programs in parallel. You have one breeding program on the mother side and one breeding program on the father side. And you basically in breed to make these both lines very homogeneous. We call that homozygous. That means genetically, they are very pure. And when you cross in the seed production to fill the bag of seeds sold to the farmer, when you cross one mother with one father there, you get this heterozygous effect, the hybrid effect that the offspring potency is much higher than what the parental line does. And the yield increase potential of this relative to classical varieties is in the double-digit area. So that is why this hybrid is such a big thing for our industry. And KWS has been pioneering hybrid's crop development and market launch ever since. A good story of that we have heard already is hybrid rye, introduced around 1987 as a first time as hybrids. And if you compare over time, non-hybrids to hybrids, you have overall 23% in general yield increase relative to non-hybrids and the slope of increase is also higher. So breeders love hybrids. And when you look at our portfolio, most of our crops are already hybrids. We are taking good benefit of that. The only 3 left up, we've heard it already, barley, wheat and potato. And the last little tech information is to show you that it's not super trivial to make a non-hybrid into a hybrid. Just remember, again, you need a mother line strictly separated from a father line and then cross them. But plants are [ selfers ]. They have pollen and female organs, and they pollinate themselves. So one of the big issues is to keep the mother plant, which actually gives the kernels and the seed, keep them from self-pollinating. And the way how we do it, actually, you've seen it already today in the greenhouse, I hope, we emasculate. We take the pollen organs off the plant. And in other words, we make the mother's sterile for pollen, male sterile pollen-free mother plants. If you have such a system, you're in good shape. You can do it. You don't want to do it by hand, for seed production. In corn, it's easy because actually here are corn plants. What you see on top of the corn plants late in the season, these castles, these are the pollen organs. The female organs are somewhere below. So in the field production, we just before the pollen gets fertile, we take a razor and cut the pollen from the plant. So you only have the female. So a separation of organs makes it very easy in corn. Where it's not easy is in small grain cereals. Why? Because the flower fertilizes itself even before you see it, right? It's actually hidden in between the leaves when the fertilization happens. So we need genetic means to make the mother sterile, but we also need to make that switchable because if you keep mother sterile, you don't get any fertile seeds produced at the end. So it's a huge complex system. Lots of features need to be -- and we call that a working hybrid system needs to be in place. And some of the details are that you have to control floral biologies because you want pollen and female organs to develop in the same stage and have good fertilization and so on. You also need to take care of production because, obviously, having that complexity managed adds costs to the production process and you want to have all these things at bay. And at the end, you need all these mother and father lines in your breeding program as pools of diversity and that is what we call optimal parent genetics, which we have under control. That's one of the core breeding things. Now just quickly going through it, where are we in winter, barley, which is the most advanced, as we have heard already today, basically, there is already hybrids produced in the market. So the system is there. We have floral biology largely under control, and those things are more in an improvement phase, but they're principally already tackled. And that is why we anticipate to have first own hybrids launched somewhat in '27, '28 to European markets and then take it off from there. In wheat, we are a little more behind, but shooting for mid of the decade something like that. And the good thing is that we have the working hybrid system in place. And just that little detail, I don't know that doesn't work. You see the kernels in the back, right? And you see they have different colors. There are some more bluish and some normal colored. And that's why it's called blue aleurone system. Basically, the blue are the female infertiles on that side and the others are the normal. So you basically need a selection process where each and every seed is actually selected by a high-throughput seed sorter, all solutions that are there in the market, and that's the key of this system. KWS has developed that in the last years with a university in Sydney. And the whole industry is working on this since, I think, 40 years, even more, I don't know. It's a super long unsuccessful innovation event, and we have cracked the nut. So what we now need to do is optimize on floral biology and all the other factors that will take a little bit more of time, but we are very optimistic that we can deliver that product to human kind. And the last part, last tech slide here is on the potato side, where you've already heard that fantastic story of getting from tubers to seed and where we've heard already that the hybrids are an intermediate step to get there. So today, everything is from an in vitro culture and you basically cannot breed it, and we will leverage it by hybridization through the first -- through the whole process. This is a super long innovation journey, which will take a few more years, but we are making all the progress that is needed step by step. We are still super confident to have that done. With that, I'm through my little presentation. I know it's a lot. Sorry for bothering you with techniques, but we are passionate for that. And if there's three things that I'd like you to take home is, first of all, we have a core engine, which is very reliable, very scalable, and that is the core basis for innovation. We beef that up with traits, with hybridization and technologies that we know deliver superior performance in the market. And we use cutting-edge technologies to accelerate and improve efficiency along our innovation pipeline. And that is why we feel confident that KWS is on a very good track. Thank you very much for your open ears and looking forward to our Q&A session a little bit later. I will now hand over to something that is much more convenient to you, I guess, financial framework with Jorn helping you there.

All right. So good afternoon, everyone. I'm really happy to have you all here in Einbeck and of course, also welcome -- belated welcome also from my side to those attending virtually. I said it already yesterday to you, what we want to make sure is that you come really closer to KWS here a little bit what's going on behind the scenes and provide you with clarity as to what makes us strong, the innovation power behind it, our portfolio, our products. And I think it's fair to say that we covered already a lot, let's say, today in the presentations, of course, during the tours, also a lot that really shaped also my belief and also my view of KWS right from the beginning and that also got me excited joining the company. And I said it also yesterday, if plant breeding was a mystery for you before the Capital Markets Day, at least it should be a fascinating mystery after you leave today. And I think I have not overpromised on that side. But I think you already see what is shaping the company. Felix mentioned it at the beginning also of our talk, very strong, rooted truly lived long-term mindset really on all levels of the organization, the way we make decisions. It is -- innovation is not a buzzword, right? It's a really deep commitment to excellence. We talked about our portfolio, our diversified portfolio, our pipeline. And Sebastian and Nico, you talked about also the customer relationships. So long-standing, reliable customer relationships that have been built over generations. And this trust and this relationship, of course, is not something that you see on our balance sheet, but it's a real strategic asset for the company. So what I want to do is to expand this picture on the financial framework. And okay, as I'm talking to analysts and investors, to you, right? So now this is a moment you've all been waiting for. And I would really like first to start with a bigger picture because -- so what really makes really a good industry to be in, right? And for us, it's really an industry that is resilient, that's robust through a cycle. It's an industry that is really driven by innovation. It's not competing on price. Of course, it's an industry where the customer cannot really delay purchase decisions and it's also an industry with high barriers to entry. And all of this is basically the seed industry and all of this characterizes the seed industry. You see this when you look at seed prices and value and look at the agricultural commodity cycle, they've been relatively immune to this, low elasticity. Of course, we heard it, it's all about innovation that we can then convert also into a premium product. And of course, our customers must plant. So they cannot delay purchase decisions, and that's a bit unlike of, let's say, agricultural machinery where you can also postpone these kind of decisions. And talking about barriers to entry, I think talk about the decades of green experience it takes really to build a product. So it's clear that we are in a fantastic industry, and KWS is a pure-play seed company. And I would say, arguably also with the most diversified portfolio. So in a robust and resilient industry, we are also even more diversified player. That's really a strong starting position. But we all know industry structure is one thing. But the other question is, okay, what do we make out of this? How do you bring the horsepower, let's say, to the pavement. And I think that slide illustrates pretty good how we've been able to translate also a, let's say, favorable industry structure and revenue growth and value growth for KWS. So over the last 10 years, we've been able to grow our revenue 6% every year. And we heard it already today is really driven by innovation, CONVISO, CR+, also new hybrids on the cereal side that we introduced in the market, rye, oilseed rape, recently with big success. So all of this is really driven by innovation. And that makes us confident. This track record, a strong track record makes us confident that we can also reach our midterm target, 3% to 5% over the midterm cycle. What is behind all of that? What is kind of our secret sauce? We believe it's our KWS value model. So classic growth compounder, if you want. So it all starts with innovation. You've seen this. You heard it over the course of today. So that's really the core, the decades of breeding experience, developing advanced sophisticated products. And then we are able to convert. We are able to convert this innovation into premium pricing, into value capture via our traits. We are able to convert this also in very attractive gross margins. And you saw also last year where revenue-wise, we're growing 1% on an organic basis, so more or less on par. On the gross margin, 63%, we even increased this slightly over the previous years because we are able really to get the innovation also to our customers and are able to capture the value out of innovation. And we are then able to control our cost, control our SG&A, then we are, of course, also able to generate the funds that we can then reinvest, redeploy into our, let's say, cycle, into our wheel, and that kind of sustains itself year-over-year, year-over-year. Numbers speak more than words. So you see that. So every year over the last 10 years, we've been able to up to increase our R&D investments, increase our R&D expenses. And at the same time, we've been able to increase, expand our margin from 16% to 20%. So I think it's a clear testament that we're able really to convert that we're able to maintain and increase our profitability. And that's really a strong position to be in, and that really is something that propels us forward like a classic, let's say, compound interest curve. And of course, we, as a CFO organization, as an admin organization also want to contribute that we can achieve our margin goals and that we also contribute to that. And I'll just give you just two examples how we are doing this from the admin side. One, of course, is our S/4HANA program that we are running at the moment. So we -- legacy-wise, we are on SAP, but operating in a heterogeneous landscape. So for us, bringing this all on one platform, one harmonized single source of truth across all regions, across all crops is a major game changer because it provides us with clarity, it provides us with transparency, it provides us with better business steering, data-driven decision-making. And we are really well underway. 15 of 27 countries are already covered, that's 55%, and we want to complete this program by 2030. So a very important initiative to really get this efficiency and get this drive, let's say, also into our admin processes. But having a, let's say, harmonized system is one thing, but you also need a platform and structure, how you can scale this, how you can leverage this and how you get efficiencies out of this. And the good thing here is that we have this already in place. We have one global shared service center in Berlin. We have -- there are over 300 people. We cover almost 30 different languages. And this shared service center is doing all of our admin processes worldwide. So from Chile to United States, from China to Morocco, everything is handled out of this global shared service center in Berlin. And that's, of course, a super strong hub, a super strong platform and also a very nice launch pad if you think about introducing smart solutions, if you think about introducing digital solutions. And one example that I have brought to you is Hypatos, for example. So AI-based engine, smart solution for invoice processing, sounds a bit boring, a PAR. But what actually helped us is actually to leverage the efficiencies in the area of 20%. So 20% basic FTE that we could took out -- could take out of our invoice processing processes and then redeploy into higher value-adding activities. And that is the leverage, the efficiency that you have when you have one central place, one hub, one starting pad and also digitalize and create efficiencies in those processes. All right. So let's move on from, let's say, value creation to value allocation. So how do we then allocate the value that we are creating. So let's talk capital allocation. I think that's not, let's say, a surprise to you that our first priority is, of course, organic growth. We have plenty of really good reinvestment opportunities. We talked about expanding our market shares. We talked about our innovation programs, our pipelines. So there's a lot that we are doing, and that's, of course, first and foremost, our priority. M&A, yes. So it's a part also of our menu card focus and discipline, of course. For us, our approach is clearly bolt-on, not transformative. We want to stay independent. Felix mentioned this also in the morning, and that is also -- will also continue also going forward. What are our focus areas? Vegetables is clear. I mean that's an area where we really feel we can also accelerate strategically. And the other area would be certain regions, certain crops where we are underrepresented today and where we can continue also to build a stronger position and a stronger portfolio. Dividends, I think it's very clear. We said this also in the summer in the presentation of our full year results that we've reinforced our commitment to attractive dividends. We've adjusted our payout ratio from 20% to 25% of adjusted net income to 25% to 30% of adjusted net income. The underlying spirit is the same, continuity, reliability, our dividends stable, ideally increasing. And of course, with the 25% to 30% payout ratio, this gives us also room also for the coming years, and we feel good about that. And of course, very clear, everything starts with the first step. And I think it's a strong signal also that we're proposing to the AGM to increase our dividends by 25%, EUR 1.25, of course, subject to AGM approval in two weeks. So I think that's a good balance, and we want to keep that balance of really reinvesting into the future, fueling our innovation engine and at the same time providing also attractive returns today. Free cash flow because if you want to deliver attractive dividends, okay, then -- and also reinvest, of course, in organic growth, then you also need attractive and good free cash flows, and that means discipline, right? So let me talk a little bit about how we are going to ensure this. You see over the last years that we've already last year increased our free cash flow contribution. So that's good. But of course, we want to push that further. So let me quickly walk you through the main moving items. CapEx, we want to cap that essentially at EUR 120 million. That means, of course, also as the company grows, the capital intensity will then also decline over time. A key element, of course, of our free cash flow generation is our net working capital. Two main moving parts. One is receivables, okay, we improved already. We brought it down by 15% last year, mainly through the portfolio transformation because after the disposal of the South American business with unfavorable payment terms that already improved a lot. But there's more than we can do in terms of collection discipline, dispute management, of course, system harmonization, understanding all the different payment terms across crops, across the different entities and countries is definitely an area we can do better. Inventory management. For sure, also going forward, inventory will follow the sales. I mean that generally will also be the case also going forward. And there is an element also volatility, which is just inherent in our business model, right? So a big part of our production happens in the field. There are harvest cycles. There will be times when we have higher or lower inventories. But here also, I think there's really an element of improvement that we can bring, which is agility, again, having a better view on how we steer our business, being able to quicker respond also acreage developments and how we then manage also our own multiplication and production partners. I think there's element of steering of managing this in specific corridors that we can improve, and that's also something we want to look into also in the future. And taxes, so basically for your model, 30%, I think, is a good assumption because that reflects very much, let's say, our regional distribution as well as recent changes on the transfer pricing side. Just to obviously finish up, let's say, the housekeeping with a view on the financial position. Really nothing spectacular to report. And I think that's good news, let's say, for financial position. We have brought net debt substantially down to 0.3x EBITDA by the end of the first quarter. That's good. Maturities, I think, very balanced. We have two bullets in follow of us, one September next year, the other one then in September 2029. And at this time, without any, let's say, M&A considerations, we feel really good to cover this, let's say, with our own funds at hand. All right. So with that, let me just quickly recap the first quarter results that we published last week. You know that the first quarter is not the, let's say, most meaningful quarter for us. So July to September, we only generate 10% to 15%, let's say, of our revenues. So apart for cereals, for which, of course, winter crop business, that's a very important quarter. There's not a lot that you can really extrapolate from the first quarter. But for cereals, actually, we have been quite happy also with the start, let's say, to our fiscal year, a very solid 4% growth. Sebastian was talking about the oilseed rape business that has grown 19% over prior year. And we kind of hoped and expected that on the performance trials, how our varieties perform in the field, but that we are really able also to bring this now into the market, gain significant market share is a strong step, and that will really propel us forward also to gain market leadership in oilseed rape. Sugarbeet on the other hand was impacted by order phasing. So we had last year an unusually high number of early order sales in sugarbeet, mainly in East Europe. So that had come to fruition this year. It's an order pattern thing. We remain with our forecast unchanged for Sugarbeet because, as you know, the big quarter -- I mean, the really important quarter is the third quarter where we have the spring sowing season. EBITDA improved substantially in the first quarter, but that was because of the onetime effect with regards to the AgReliant divestiture or AgReliant deal. So we recognized the gain from the license agreement as part of this entire deal, EUR 33 million recognized in the first quarter in the EBITDA, and that is something also we flagged already end of last year when we signed the deal. So overall, I would say, a solid start to the year for us after the first quarter. In terms of outlook, I mentioned this already also to you that, of course, currently, the uncertainty in the market is, of course, visible with the low agricultural commodity prices. There is an uncertainty among our customers on what to plant. We expect also a decline of our business in Russia this year -- this fiscal year. But at the same time, this also offers opportunities because if there's uncertainty in what to plant and given our very broad portfolio, there's also opportunities that we can capture. So that's why we confirm our guidance of around plus/minus 3% organic sales growth for the year. We will be landing in the corridor of 19% to 21% EBITDA margin. And this is, of course, without the onetime gain, the EUR 33 million onetime gain I mentioned that we also guided at the beginning of the year and that you can essentially already tick off your list because that's recognized settled in the first quarter. With that, yes, let me wrap up. So as I said, we are in the right industry. We have winning portfolio that makes us really confident that we can also continue to maintain this momentum. We have a proven growth compounder model. It has worked for us in the past. It will work for us also in the future. And of course, we, as an admin organization, want to also pursue targeted transformation in order to make sure that we control SG&A that we are able to also improve the margins. Capital allocation, I think pretty clear first priority, organic sales, but we will also capture M&A opportunities if they are in front of us, and if they make a strategic sense for us. We put a renewed focus on free cash flow generation, and that gives us confidence and that puts us on a good position to deliver on the 3% to 5% midterm growth forecast and the 19% to 21% EBITDA margin. So thanks for that. And then Felix, I hand it over to you for your closing remarks.

Thank you, Jorn. Congratulations. You almost made it. I see some a little bit maybe tired faces, lots of information, lots to digest, lots to take with you to take home. I hope that we got our point across what makes KWS special, and why we are unique. Well, I think we've very clearly laid out how and where we're going to play in the future, building on our existing large crop portfolio in the field crops, lead, and I think Nico and Sebastian very clearly underlined that how that's going to look in the future regarding sugarbeet, hybrid rye, oilseed grape or corn. Secondly, the growth opportunities, the building phase, entering new crops, new markets, new opportunities, vegetable, full steam ahead, KFI tapping into the food value chain and the big bet on true potato seeds. And I know, yes, it's going to take a little bit of time, but I'm very confident we'll meet here again at some point in time and those little seeds in that little tube will have turned reality. Thirdly, our exciting innovation pipeline. Tom, thanks for giving us a detailed look into that. And I hope you get some look and feel in that when you took the R&D tour, visited our facilities. Jorn took you through the financial figures, short and brief, precise to the point, clearly laying out our ideas, ambitions in hard facts and figures. And with that, I think it's time to turn tables. We did a lot of talking. Now it's up to you to talk to us, to ask your questions. And for that, I think we'll bring up some chairs on the stage, and I would like my colleagues to join me here. I think Peter will moderate a little bit if that's necessary. And with that, I would like to -- first of all, again, thank you for coming here, finding little Einbeck on the German map and taking that time spending a whole day or maybe even more with us and to get an understanding for what we are, KWS. With that, the floor is yours.

Thank you, Felix. Just for the Q&A session, we have colleagues with a microphone. So please use a microphone that people attending via the webcast can also hear the questions. So please raise your hand and state the name and the company, and that would be very helpful for the Q&A. Thank you.

Christian Faitz, Kepler Cheuvreux. Two questions, if I may, to start. First of all, on your breeding efforts, can you share with us some thoughts on short-statured corn varieties, which you might bring or might not bring because one of your at least key peers, and I think we both know them well, is quite successful launching short-statured corn. And then second, your EUR 300 million sales ambition in vegetable seeds. That means you will still have to add some EUR 200 million in non-inflation adjusted, obviously, blah, blah, blah in 2040. How much would you believe as a guesstimate is organic growth from your own breeding efforts? How much is acquisition? Because as we all know, and I guess Pop Vriend is also a good example for that. EV sales multiples are anywhere between 4 and 5 and sometimes even higher.

Do you want to start with the vegetables?

Okay. I can start with that one. So I think to the vegetable question, yes, indeed, most of the growth, which we are expecting or we plan is mostly coming organically. So it's not really counting. We don't have, at the moment, a transaction on the table that we are accounting for in that part. So it's mostly these 5 new crops delivering, plus, as I mentioned during the presentation, the two crops within the existing portfolio, so red beet and swiss chard, where we think we have a quick opportunity to win share there as well. And of course, continue our development in beans and spinach. So it's mostly organic. But as Jorn mentioned, we are looking also with a lot of interest to specific targets, of course, that can complement or speed up the development in some of the crops.

So no M&A in this figure.

Right.

The short-statured corn?

Short-statured corn is successfully progressed to some extent with lots of ambition and power. The product has not, to my understanding, fully materialized and taken grips to the market. It is a tool in the first instance related to the North American and U.S. market because it's actually a combination package of the whole traded package, which we are obviously not playing in that field anymore. And I think it's fair to say that we have invested a little bit into such direction, but the ambitions have reduced significantly with the new strategic position that we have in corn.

And maybe just to add because there are some products coming into Europe as well based on non-GM basis. There is a trade-off between the size of the plant, so that machine that need to do the photosynthetic activity and yield. And so far, we still see that. We see maybe a certain value on areas or under extreme conditions of wind, et cetera, where maybe a shorter plant can resist maybe better. So there is a certain need for such a product. We actually have already a pipeline on that just by pure breeding. So we have already shorter plants that can manage that. But as Tom rightly mentioned, the target market, if we think about, I don't know, Brazil, South America or also the U.S. for us is not really one of our key topics today.

Maybe to add on that. If you look at the development of corn plants over the last 20 years, there was a great tendency that plant length was elongating. And therefore, I think it's also kind of a natural phenomenon that you want to reduce plant height a little bit again. And there is, of course, if you plot lines, a clear optimum in sowing density, plant height and then yield output. There's just an optimum and you can, of course, move those a little bit, but you cannot shift it biologically.

Oliver Schwarz.

Oliver Schwarz, Warburg Research. First of all, thank you very much for the plethora of information we received. I'd like to challenge your 3% to 5% organic growth aspiration for the coming years. Coming from 2 -- perhaps coming from 2 separate points. First of all, 20 years ago, your R&D ratio was 15%. Now it's 18%. Over the last couple of years, your CAGR in sales was 6%, and now you're aiming for 3% to 5%. So what's happening here? Why is growth going down while R&D expenditure has gone up? I appreciate that the margin has gone up to a level that seems -- now it's 20%, that seems given your aspiration of 19% to 21%, which seems to be sustainable. But that seems to be also just the result of scale effects in production and not reduced our R&D costs to sales, at least that's the way it presents itself to me. The second one was, given all the very interesting projects you have and the record number of new products coming to a green light from the authorities and coming to the markets from your side and giving the sales potential of those projects. I appreciate that none of them will really spike just next year. But we are talking about midterm targets. So probably until 2030, where at least some of them will have made it to the market, plus, let's say, the tailwind from existing products, which are still growing. And still the organic growth rate is expected at 3% to 5%. Please help me to, let's say, bridge that gap for me to understand what's happening here. Is it because you're now so focused on Europe, which seems to be a mature market that your growth perspectives in that region is limited by the region itself.

Maybe I can just get started and maybe others can chip in and add to that. So first of all, I mean, if we can deliver more, we are, of course, happy about that. So that's clear. But we want to be also realistic, let's say, in talking about the environment in which we operate in particular right now and also looking at what comes when exactly also on the market to fuel also further growth. And when we look at, let's say, market growth then in the 3% to 5% corridor, then we look specifically over the next 3 years. So we don't look at 2030. We don't say 2035 because you saw that already that major contributions also will kick in a bit later when you think about sunflower, when you talk about vegetables, when you talk about also hybrid wheat in -- at the beginning of the 2030s. So that is not baked in the 3% to 5% growth ambition. So we will look, let's say, over the really midterm period, next 3 years because we want to give you also a clear visibility and a clear picture and not as an anchor some kind of funny number, let's say, in 10 years, but want to provide this clarity. And if we compare ourselves against the market, and we talk about, let's say, 3%, 2.5%, 3% as a market growth rate. That's also, let's say, what I would say our peers are essentially guiding towards. So we're already growing faster than the market. We're already growing faster than our peers. And right now, also with the environment in which we operate, which means low agricultural commodity prices, everyone a bit cautious as to when the pendulum will swing because it will swing, but we don't know exactly when it will swing. We feel actually quite good with the 3% to 5% growth corridor.

Maybe to add on that, if you look at the past growth rate, I think you have to clearly also take into account that Brazil was a strong growth driver. There we started in 2011 with roughly 1% market share, and we divested that business reaching almost 12% market share. And as you see on these other numbers, we are very strong in the markets we're in today. And so of course, you can -- if you are lucky with the right products, obtain a different growth rate in new markets that you enter. And that was just what Jorn has laid out. That is what is to come, but what is not in this 3-year window. In addition, I would like to point out, since most of the markets we operate in our regulated markets is that means that the product that will come to the market tomorrow and after tomorrow are already in national registration. So we know what will come to the market. And it's not that we can say we have an innovation, we sell it tomorrow. We take the innovation, we have to submit it to the regulator, see trials. And therefore, of course, we have, on the other hand, a very clear visibility of what is coming in the next 2 to 3 years. And therefore, when we have a product ready, we have to take into account these 1, 2 or 3 years of official registration before the regulator says, okay, you're free to get that product into the market. And therefore, there's always that time delay you have to take into consideration.

Maybe just to add to your question of the R&D ratio, which I think all the rest has been answered. We discussed it yesterday. You have seen it as well today. We have a lot of products which are long-term investments, which are carrying a lot of research. So from the hybridization, from the new fruit and crops that we're bringing in, vegetables, all those are not yet in the market. Nevertheless, we are investing quite a lot of resources into bringing them forward. And the other component is that we are through the divestment, we have reduced, of course, top line. And that, of course, have the ratio today at the 18% where -- what you have mentioned yesterday, and it's very much the main driver.

Leon Muhlenbruch, mwb Research. I have only a short question. Where do you see the biggest risk for your business? You see it in the research part? You see it in the regulation part or where you see for you for the future, the biggest risk?

Thom, maybe from a research part first?

I think I made a story more from the where is the low risk, I appreciate the question. There is, by and large, technical considerations, technical risk that need to be taken into consideration. And as I've mentioned, we have those more or less under control. If there is an uncertainty, I would not call a risk, then it's the uncertainty about how is the EU going into the editing area because this will be an innovation leverage over time. But this, I wouldn't call risk so much because as far as we see, we can be quite optimistic that there will be a solution. How far reaching the solution may be basically determines how much we can leverage there, and we are prepared to adjust our activities according to that, if necessary. But even that, I wouldn't call a big risk. So the question is what is a big risk to be taken to be considered in that I don't see many of them.

I think maybe to add on that, "a risk" of course, at the moment, certainly the geopolitical uncertainties. And that is nothing particular to KWS, but we see a continuous ongoing war in Eastern Europe. We see a hard to predict U.S. government. And therefore, we are in a state, I think, of less visibility than maybe 10 years ago, and that is -- that remains an uncertainty.

Yes. I just exactly want to add to that because these are the 2 topics, let's say, I would say, from a financial geo perspective. You know that we still have a business in Russia. It's below 10% of our revenues. It has drastically been reduced over the last years, of course, since we are not able anymore to really have even business in Corn and on the Cereal side, but we still maintain a Sugarbeet business in Russia. Right now, it works. It's very difficult to substitute. But of course, that's really -- not really in our control, let's say. So that is definitely something that always continues and swings with us, let's say. On the tariff side, U.S. side, I would say a bit more relaxed, let's say, because seed industry is an industry which is very local or regional. You produce locally, regional -- in the region for the region. There's only one area, let's say, in our group where we export a meaningful, let's say, share of seeds from Europe to North America, and that's Spinach's on the digital side. But also here, 60% of our production and Spinach is actually locally in North America. In the other areas of our business, we were not really affected by any tariff issues.

[indiscernible] Advisory. I would like to spend a little bit on corn first. Last year was pretty lousy in the margin, if I say, in Europe, and this year, it should be much better. Could you elaborate on the reason for last year and for next year? And rapeseed is in a very good -- dynamic in growth now. I remember a period of more than 10 years ago when we have seen already a very dynamic growth, and then it stopped at one time and market shares were even declining and now they are recovering. What is your confidence that the varieties we bring to the market is not only for the next 2 to 3 years, but will extend this growth? And the last one is on hybrid. Wheat I'm not sure whether the competitors are real in what they say, but they want to come a couple of years earlier. I think as of '27 is what Corteva says, what Bayer said and was also BASF say. They say this for long. I'm not sure whether this '27 is real or whether you are more humble in saying it will be north of 2030 and might be still the first. But maybe you can elaborate how you see your competitive situation in that.

Very good. Maybe I'll start with a hybrid [indiscernible] to pick up on the last one. And you used the word which I like very much, and that is humbleness. Yes, we would like to stay humble, where, as Tom said, rather north of 2030. We, of course, observe what competitors are doing. They have a different approach in terms of communication and promising products to the market. We are very confident in our planning, our milestones in our more maybe conservative way. But I think you have gotten to known KWS as to delivering on our promises. And therefore, in this case, I would rather concentrate on ourselves than on our competition.

Maybe I'll take the first question on the margin on the Corn business. So just that you take into consideration last year, of course, we still had a big portion of the North America business in our segment reporting. And the way we report our figures on a segment basis was on a quarterly basis, which means we have also 50% of the Agroline share in our segment reporting. And of course, that has been a business which has had negative earnings I think in last year as we were going through a lot of restructuring and preparing the business for sale. And of course, as this is now out of the equation, and I think Sebastian mentioned this on his slide, when you look at the parameters, not only operative profitability, but also capital intensity and so on has, of course, substantially improved. And our goal is to deliver a 15% EBITDA margin for the Corn business this year.

And we believe on the Corn side, that's not unrealistic because we have launched 12 new varieties in the last 1.5 years. So the growth driver, the innovation is there. It's not in the pipeline. So we see that right now. So market share is gaining on that side, and I've explained and shown some of the innovations we have going. Additionally, to your question on rapeseed, rapeseed is a very good alternative for Western European farmers right now since commodity prices on rapeseed is high compared to everything else basically, except sugarbeet. Sugarbeet is still strong, but rapeseed is a good alternative for cereal and grain or corn farmers. And so we see an uptrend market in general in rapeseed, and we are really there at the right time with our product portfolio to capture that. And this 19% growth we've seen in rapeseed, we will see that this year too or even stronger this year. So the outlook is quite promising that we will continue to grow and capture market share additional to the growing market.

And maybe in addition to that, I'm fully convinced of our strong portfolio in oilseed rape. But on the other hand, of course, we are not alone in the market and others are -- will certainly try to beat us, and that is what is in the interest of the farmer to have the best product. And we have to do what we can do in order to assure that our products are most competitive. On the other hand, if you look in the history of the winter oilseed rape market in Europe, I think it's one of the most volatile seed markets. If you look back 10 years, Monsanto today, Bayer had 60% market share. So there is a lot of volatility, and you need that little touch of luck maybe in your crosses at the end to be on the very front line. But I think at the moment, we're very well set up, and I'm fully confident that our continue will go strong -- our portfolio will continue to go strong.

Axel Herlinghaus from DZ Bank. I just have a question to the Russia business. So how have these Russia revenues developed from '23, '24 to '24, '25, in the light of increasingly stringent import quotas, have you still relevant Corn and Cereal business in Russia? And what export import quota do you expect in 2026?

So I can start and then you maybe add Nico. So overall the last year, so '24, '25 fiscal year compared to '23, '24, it was a mixed picture, I would say. So we had, of course, to face the situation that we did not anymore get business for our Corn business and, let's say, on the Cereal side, business that we were used to. So that has really came down. And maybe you saw that in the charts of Sebastian that Cereals as a total BU dropped, let's say, '24, '25 compared to '23, '24. That was exactly because of this Russia effect. So it was mixed, let's say. So on those let's say, crops where we did not get a quota or we only were able to get opportunistic business, let's say, there was a decline where Sugarbeet on the other hand, actually upheld, let's say, its import quota share. And hence, we're also then still able to benefit, let's say, from the business in Russia. And this is basically also how we started this year that we aim to maintain our market share in terms of import quota. And on the other, let's say, crops, it continues to be opportunistic. Sometimes there is a need for a truck or 2 and then we deliver, but it's not really a, let's say, reliable business. And that's why also -- I guided also for the outlook this year that on those areas, outside of Sugarbeet, non-Sugarbeet business, we will see also a further decline of the revenues. For the quarter next year, it's too early to say. We will only get this by the end of the year for next year. But maybe, Nico, if you want to maybe talk a bit more about the situation.

I think it's almost all said. As you might be aware, the Russian government is trying to localize the seed production. The fact is that for sugarbeet, that's very difficult to do, and they have been trying already for many years. We also did in the past some activities there, and they have not been able to have a stable and high-quality seed. And basically, we're quite convinced that no matter what happened, they will require to import seed. That's the fact. And that's why we think we still have a chance to import seed into the market. As Jorn mentioned, already for the sowing of 2026, that's pretty much set. So we already have the quotas. The seed is on its way. That's done. So basically, what we are discussing now will be the quotas for the year after, so for sowing '27. There is already an indication, but what we don't know is how much -- how the allocation will be distributed among the different seed players. The assumption is that it will be something similar to what we have done in the last year. So at the moment, it is relatively stable. But of course, it's a situation that is not fully under our control.

Once again, sorry for that. Oliver Schwarz, Warburg Research. Two questions from my side. Could you give your thoughts on the West European sugar market? You showed the slide where the acreage has been declining for the last couple of years. And it seems like sugar consumption in Europe is on the decline for various reasons and also suppliers, hence, the producers seem to be aiming for a deficit market, which would imply that acreage has to decline further. Do you share that opinion? Is there somewhere, let's say, where that effect peters out? Or will that continue for a prolong period of time in your view? That would be my first question. Second one, completely unrelated, so to speak. Free cash flow on average was EUR 100 million on average over the last 5 years. Given that you stated that you want to have a stable CapEx of EUR 120 million, but increasing sales and earnings over the next couple of years, I would expect that number to increase, especially as you stated that you want to focus more on free cash flow generation and bring working capital quotas a tad down from their present numbers. So that EUR 100 million number, which is likely to increase from my point of view. And even after the significant increase in the dividend, you're selling out to shareholders EUR 40 million. So you're aggregating capital over the next couple of years. I appreciate that you have M&A ambitions. And -- but if they don't materialize, are there any plans to distribute some more funds to shareholders in the midterm? Or would you just stack that up and wait for some attractive offer to come around to make a bolt-on acquisition?

[indiscernible] with the last one?

[indiscernible] because I mean, there's really not much to say because you answered the question already yourself. It's exactly like you say. So when we look, let's say, into our projections, this number should increase. We don't -- as you know, we don't give a specific free cash flow guidance because of harvest volatilities, it's difficult, but we want to improve that. And I think last year is already a pretty big jump. So 7% free cash flow of sales, previous 2 years was more like 3% to 4%. And that should be also the way going forward. We feel actually with this corridor, that's why we also increased, also corridor to have that flexibility in order to be able to also make steps in the direction that you've described. But for us, this consistency is important that we don't have big shifts from 1 year to the other year, but we have stable, ideally increasing dividends year-over-year. And I think with what you described and also this increased payout ratio that gives us exactly that flexibility.

Connected to the sugar market, basically, on one side, the demand of sugar inside of Europe is more or less stable, around 17 million tonnes per year. And normally, Europe produced about 16.5. So in general, we are a net importer. We're talking about EU 27. The market per se is protected. So they normally between 2 million to 2.5 million tonnes per year that can be imported without any tariff. After that, then the tariff apply and basically made the whole importation not attractive. It's almost double of the world price today. So that's basically not attractive for the producers. But what happened at the beginning, especially at the low world market prices, which we see today, which is one of the lowest we have in the last 5 years, that sugar comes in, and that's what already happened as soon as the calendar year opened. At the same time, the last 2 years have been very successful internally in Europe on sugar production. Also, there is also some sugar coming from Ukraine into the European market as well for different reasons. So what happened as well is that the normal amount of sugar that will be exported out of the EU for countries, for example, in the Middle East, based on the low prices outside, they're also not going out. So today, we're in a -- from my perspective, in a cycle, which I think is short term, it's not something that will stay, but the market need to adjust, and this is the news that you see today, we need to reduce the acreage because at the moment, we have contracted beet growers for a price of ton of beet that will derive in a sugar price, which is higher than actually what we will be able to sell it. So that's natural. So it's a matter of demand and supply. But we don't see those huge reductions we saw from the 7 million to the 4 million, what I was showing 4.5 million. That has been driven by a lot of reforms. So there were 2 waves of sugar market reforms in the last 30 years, which is deriving a lot of closing of factories and things like that, where certain specific incentive for sugar production were allocated. All those are already gone. So basically, what remains is really those, as I said, import quotas. We're discussing a bit yesterday about [ Malcosol. Malcosol ] is also about 200,000 tons. So it's also not going to be something that is going to move the needle. So short term, you might see these cycles and affecting us on a yearly basis, I would say. But it could also go the other way around if there is a disaster in Brazil or in India regarding to weather, we have those not to a few years ago and sugar prices go up, and then we'll see another wave in the other direction. So it's mostly as anything we do in agriculture driven by nature, I would say.

Christian Faitz, again. Two quick questions. Sunflower, what makes you so confident that you can essentially quintuple, I believe, if I remember the market -- the number correctly, the market share over the next 10 years and that the established producers aren't fighting back, including your friends out of the Ivania region. And then just maybe a naive question, but can you share with us how competitive sugar from wheats is at this point in time versus cane? And has this maybe changed with various brands in Brazil, for example, I think 10 years ago or so or 12 years?

On the sunflower question, I -- bear with me, I'm not an expert on that.

I'll support you.

You'll support me. Thanks Nico. No, I mean, we see a strong portfolio coming in and the trials of those are really strong. And so we believe we have a competitive edge, and you saw the time when we started breeding on that. And the pipeline is just emerging. The first varieties are coming out and the trials are very, very promising. So we hope by innovation to gain market share on that. And of course, that's not easy right now since you've noticed already, we focus on Southeast Europe and Southeast Europe is hidden by drought. And so the acreage in that area is trending down. Although the innovations we are adding are focusing on drought resistant too. So we believe that could be a little bit of competitive edge for us as well. But on the same time, we also focus or look at different areas and change a little bit towards France and those areas because we believe that will be a growing market in that condition right now.

Almost all said. I think we also -- when we look at competition in the sunflower landscape and you see the level of R&D investment, it's not like what we see in Sugarbeet. So it's not that people are investing $100 million plus. Actually, if you look at the market, those who have the leading position in sunflower are likely not putting the right focus that have driven in 2 things. On one side, I think we are catching up with them in terms of operating progress, as you said. And on the other side, we have been able to recruit a lot of highly talented people from those companies because they really appreciate this seed specialist approach that we have and the attention to the individual crops. So in that regard, I'm quite confident that we'll be able to catch up. And then the synergy with the crop in the go-to-market with corn and in the whole rotation is also something that makes us confident that having that portfolio, it will make us basically stronger. So that's clear.

Beet versus cane?

Yes. So beet versus cane, today, as maybe most of you know, about only 20% of the sugar, which is sourced is coming from beet, 80% is coming from cane. The main exporter is Brazil. So Brazil export about 30 million tons per year into the market. Then you have different effects on one side, like today, when oil prices are low, Brazil moved the needle to produce more sugar instead of ethanol out of that cane. So the quota moved more on the sugar side. In terms of competitiveness from a cost point of view, today, we have about a 30% gap. So beet -- sorry, cane is 30% cheaper than beet, depending on which market you compare to which market there. I'm looking really to Brazil. So the leading market compared to what would be, for example, the Netherlands, which is highly, let's say, effective and efficient in beet production. What will happen in the long run, at least this is what is one of our long term, and we don't present it here because it's going to take time to get there. But the breeding in cane is super slow, very, very slow just by the chromosomic composition of the plant, the fact that there are no private breeders really investing a lot in breeding in cane, basically that mostly public institutes in Brazil, in India, in Thailand. So you see that the breeding progress is quite slow. So the curves that Tom was showing, this 1% to 2% that we get in beet and in other crops, at some point, we should be able to close basically that gap in terms of overall performance. You know that we will replace cane. So that I think to be realistic, maybe it will not be the outcome. But likely, we'll be able to serve markets like the Middle East and Africa that due to transportation, et cetera, we are closer. And we're quite optimistic that in the longer run, we should be able to offer more, let's say, world sugar source from beet.

So are there more questions? Everyone so much overwhelmed by all the detailed projects we introduced today. If not, then that brings us to the end of the day. I think also on behalf of the presenters and the Executive Board, thank you very much for your attention, for your interest and also participation. As I said, a lot of things will be presented today. So please feel free to reach out to my IR colleague, [indiscernible] or myself in the next couple of days. Happy to answer your questions that may arise. For those who came to Amberg, have a safe trip home, and see you soon. Bye-bye.

Thank you.

Thank you. Bye-bye.