Rubis (RUI) Earnings Call Transcript & Summary

Ladies and gentlemen, good evening, and thanks for joining us this evening for this session. A special word of thanks to those who are sitting with us. We are in an area that is surrounded by demonstrators and only the bravest have made it to this venue. I'm pleased, together with Clarisse, Bruno and Fred Royer to present the 2022 financials of the Rubis Group. After a few opening remarks, I'll hand over to Clarisse, who will go into greater detail on the operational items of this year. And then Bruno for the financials relating to the operating performance. And then our guest, Fred Royer just landed from Dubai, bitumen [ boss ] previously had management functions and other important subsidiaries tell us about the wonders of his trade. And after some conclusions from Clarisse we'll be happy to take your questions. So particularly pleased to present the results today because the year 2022 has allowed us to achieve 3 objectives that seem to be quite significant. Our first objective was to be our historic all-time record of 2019. After 2 years of COVID, that meant that we weren't able to move things very much. And operationally, we exceeded the record performance of 2019 in terms of EBITDA, -- EBIT and operating income as we'll see later. The second goal was to achieve a structure of the UBS Group, which is hand for the existing structure after integrating Photosol in the group. Photosol one of the leaders in France of the production of PV power. We consider that this structure has laid the basis for continued expansion over the long term. It allows us to offer to our various clients. The necessary energy solutions whatever their market segment, whatever their geography and the regulations applying to the geographies in which the present third objective, which is a recurring objective. But first, for us is that after this M&A with Photosol in April '22 after just over EUR 200 million in CapEx investment with a dividend that will be proposed to the AGM with some EUR 200 million. The balance sheet of Rubis remains very strong with indebtedness that doesn't exceed times 2 and the corporate debt that's even lower. So this has been a constant objective of ours. On the liquidity front, liquidity is key. For us every year, particularly when the banking systems tend to flow. We have EUR 400 million confirmed credit lines means that we can view things with confidence, including possible M&A deals. [indiscernible] about the fundamentals of the group as they present themselves to the same fundamentals that have fueled the group's growth for many years now. And so on the left, energy, energy, the [indiscernible]. And on the left, you see the forms of energy that are based on very powerful fundamentals very deep-seated there are demographic changes, areas such as Africa, but also a large part of the Caribbean not necessarily the islands, but Guiana say we also have growing urban development that is prompting demand leading to heightened increased mobility, new infrastructure projects, the energy transition that's paramount and fascinating with as many risks and opportunities and all the economic changes. So these energy needs, be they in terms of volume or changes to new forms of energy are on the rise and in certain areas, I'm thinking of new energy in Europe and France, there are plants that you're well aware of and that are considerable in terms of development. We are building on basic needs, basic requirements that, of course, naturally price-sensitive cooking, hot water heating, all forms of mobility and beyond that, the needs for agriculture of commerce and industry. So in this universe, we are positioned with a number of strong points. LPG, really historic product of ours that is a transition solution in terms of energy fully suited in mature areas such as Europe, also for rural and peri-urban areas where it's difficult to find substitutional products and also fully suited to areas such as Africa, where we operate, which has a favorable impact on the environment because it is replacing coal -- charcoal, many governments are encouraging LPG for that excellent region. And to fight against the forestation Charcoal is a major cause for deforestation to combat pulmonary disease and the negative impact of heating coal. Charcoal stove in homes as the WHO can attest to, and then we've got the kind of conventional fuels, mobility industry, agriculture, wherever possible, we worked at replacing biofuels to conventional fuels. It's an area that isn't within our part of the production, the various refiners increasing industrially the availability of these products. It's a process underway. And then thirdly, renewable power PV for us, which is a tremendous segment high growth in mature markets, Europe, France and which will without a doubt be an additional growth segment in emerging markets. And next, and we'll come to that a bit later on, bitumen that rests on the huge infrastructure needs in many countries in which we operate. The production is with carbon content. And then JV with a U.S. fund, we have 50% of Rubis Terminal business, 2 parts with the same facilities logistics segment, serving the logistics of petroleum, chemical, agri food products. And when things are going well and the economies are growing, we need more logistics and storage is equally important because when things don't quite well supply chains are disrupted. We need a bit more storage space is what's been happening in these pass-through years. That's why the business is growing 5 years, be it with or without COVID, the economy positive were less so. More conceptually, our vision of value creation for the Rubis Group is to use the significant cash flow generated by Rubis Energy, in our traditional activity, significant capital to fund the CapEx of those same activities to fund constantly rising dividends as we've been doing for some 20 years now, it goes back even further regarding increased dividend payout and also to fund growth drivers in renewables and the bulk of the renewable investments that we plan in the coming years will be largely self-financed. Now it's the application of these principles that can change or be adjusted depending on the major areas in which we operate in Africa. We've got very strong points aside from LPG on bitumen East Africa, Kenya, where we invested about 3 years ago. We're, of course, working now with Photosol to produce a combined offerings traditional products and PV products, Caribbean somewhat different. These are very fragmetic markets where fine logistics is key. And in those areas, the new low-carbon products. It's with HDF, hydrogen [indiscernible] where we're developing projects with integrated hydrogen storage to develop carbon-free power 24/7. Now Europe, since we invested in further sold in asset value, we're essentially dealing with renewable assets in Europe as such. And the other key product remains LPG that I already mentioned. And so in Europe, we're expecting high growth rates linked with what we're all familiar with regarding government policy in the area and the mechanisms in place to attract investment into these businesses. A quick focus on the highlights in 2022. Rubis group has displayed considerable resistance to all shocks. Each and every year, we can experience very different situations with different metrics. This year, we had an inflation shock, an interest shock, a shock on the currency markets in many countries in which we operate is linked to the first 2 points. And lastly, a shock on the price of petroleum products because it's a doubling that we and are clients suffered during that period. It's with a price of over EUR 1,000 or dollars per cubic meter, probably an all-time high. And so this price metric is really hurt a business such as our EBIT EUR 509 million, up 30% that we can, of course, adjust that because the margins were very high to convey number of ForEx losses in certain countries and transmitted to the market, not just the increase in the price of products, but ForEx losses on the back of distortions on the currency markets. If we restate for that, we have 20% EBIT growth, which is still very high. Net income adjusted group share of 11% will return to adjusted for -- a loss, an impairment on Haiti, come back to that and Photosol acquisition costs and then a strong balance sheet, as I indicated, to maximum on EBITDA and five on the corporate debt. Renewables, we're very pleased with the integration of Photosol in the group. We found very high-level teams, very well integrated. We're working very well together and they can adapt remarkably moving to a listed company under IFRS on the one hand, CSR projects that are activated. They continue to work on their growth with a pipeline increase first corporate PPA signed with Leroy Merlin, an acquisition, a small deal, but a very efficient, Mobexi giving access to a market segment from rooftops and canopies on car part because with this new legislation it goes up to grow on surface areas that will come closer to the smallest projects of Photosol in its usual form. Also have a big effort that was continued in terms of CSR road map, we've extended objectives beyond scopes 1 and 2 to Scope 3A. We signed additional loans with references on carbon footprints. That effort is ongoing. And third point that I wanted to mention that I've already broached dividend that we'll be proposing at [ 192 ] to the AGM. That's just over 3% increase. I won't dwell on this chart because both Clarisse and Bruno will do it as well as if not better. So here, you have the growth in terms of revenue, EBIT, EBITDA versus 2019. Our target to be adjusted for ForEx. The rates are above 20% in terms of net accounts were at minus [ EUR 63 ] adjusted to plus 11% plus up versus 2019, [ EUR 326. ] EPS adjusted, plus 10%, plus 5% versus '19 and '20 dividend, we just mentioned, and you have the debt ratios that I've already discussed last line, CapEx, EUR 259 million, EUR 40 million in Photosol renewable power. And today worried about 20% of investment share in renewable energy and in carbon reduction. I'm pleased to hand over to Clarisse for the next section.

Hello, everyone. Thank you very much for being here. Over the next few minutes, I'd like to talk to you about the operating performance of the various businesses. But before I get started, I would like to remind you of our 3 main business lines, including energy distribution via Rubis Energy. So support and services will be part of the distribution business starting 2023 and then the production of renewable electricity via our newly created subsidiary, [indiscernible] both which includes Rubis Photosol and our stake in HDF Energy and also the storage of liquid products, which is being carried out by our JV Rubis terminal. Let us start with Rubis energy. Our LPG fuel and bitumen distribution activities have delivered a very solid performance in 2022 with a strong growth in EBIT and cash flow generation that remains stable overall. As mentioned in previous presentations, our investments in these activities are significant and they focus on our major growth drivers, namely the bitumen activities and also the upgrade of our retail network or service station network in East Africa. However, our investments remain under control, owing to our cost discipline. It's been stable for a number of years now. So 2022 has been a busy year for Rubis Energy on the environmental front. In line with the previous announcements, we have deployed an internal carbon pricing methodology which is intended to support our decision-making, which depends on our different geographic areas, whether for investments or equity investments. We have also finished working on identifying our Scope 3A emissions and defining a related target. This target focuses mostly on outsourced [indiscernible] transport, which accounts for about 50% of our Scope 3A emissions. We have set a target of minus 20% by 2030 relative to our 2019 baseline. Before we get down to -- tax and discuss our different businesses, geography by geography, I would like to look at our 2022 EBIT for Rubis Energy. As I can see growth comes mostly from our 2 drivers that I talked about before our operations in Africa and in the Caribbean area. Let us start with Africa, which is the leading region in terms of EBIT generation for the group with the 52% contribution to the retail and marketing business, and have seen a significant increase in its profitability over 2022, although there may be a ForEx impact, particularly in Algeria. Excluding ForEx, EBIT grew by 20% over the year. This is a good performance which underlines the effectiveness of our investment plan in East Africa, and this has enabled us to improve our network and streamline our client portfolio, thereby boosting profitability. With regard to bitumen, Fred, who's here with us, can tell you more later. The business held up really well with significant growth in South Africa, where our operations started up at the end of 2021. Nigeria slowed down at the end of the year, particularly in the run-up to the election period and has already picked up again now that the elections are over. In terms of development projects, we have started to convert to solar, some of our sites in Madagascar and East Africa. Electricity output levels are still low. But it's the first step towards developing solar energy in these areas. We're talking about 300-kilowatt in capacity installed today. We've also worked really hard this year to secure partnerships. In the near future, this will mean cross-selling opportunities. So that include our legacy products, fossil fuels and solar energy for our business customers. So those cross-selling opportunities will include a renewable component. Turning now to the Caribbean region which accounts for about 34% of the retail and marketing EBIT. Volume showed strong momentum at plus 13%, excluding the Haiti effect. The economy has recovered well in the region and the aviation segment is growing strongly in line with the recovery in tourism. And this means an excellent performance with EBIT up 62% for the period. We're still investing in improving our retail or service station networks and this is bearing fruit because our so-called NFR or nonfuel revenues from service stations are growing at a steady pace, and this is the case in Africa as well. I forgot to mention that. So a quick update on the situation in Haiti, the general situation remains extremely challenging. But we are maintaining operations despite deteriorating circumstances. Our priority remains the safety of our staff, the overall state of our business and of the country, in general, means that we have recognized a EUR 40 million goodwill impairment this year. And we are looking forward to calmer waters in 2023. Regarding our outlook in the Caribbean, in recent months, in recent years, actually, we've been working with HDF Energy to develop several projects including a first project in Guiana, which is currently being built and a second project in Barbados, in which we have a 51% stake. This technology combines solar energy, hydrogen and fuel cells and will power 16,000 homes with no intermittence. And this will also help to decarbonize the island energy mix, which is currently 95% fossil fuel based. We're also working on converting to solar several of our retail sites, particularly in Jamaica, which has already reached 300-kilowatt in installed capacity. Let's move on to Europe, an area that accounts for 16% of our retail and marketing EBIT this year and in which we mostly distribute LPG to this innovative percent. So demand has been quite soft this year, particularly at the end of 2022 with this winter starting off mild. However, in the LPG markets, we are making sure that we maintain our operational efficiency and our excellence, which allows us to gradually gain market share year-on-year. Our growth was stronger than expected in the LPG fuel segment, driven by higher prices at the pump and also because the number of carmakers have marketed new LPG/petrol hybrid models. As for expanding our offer, we now have cross-selling opportunities that include solar energy for our business customers in the Channel Islands in particular. And we have also rolled out several eco-friendly fuels such as [ RD100 or ECO HEAT 100 ]. Now the support and services business is still growing, driven mostly by our shipping activities. There was a major bitumen delivery opportunity to the United States during the rainy season in West Africa, and that opportunity proved extremely profitable. We were also able to make several deliveries of refined products in the Caribbean area. So these shipping activities as well as the SARA refinery present major decarbonization challenges for the group. And that is why in line with the Sea Cargo Charter that was signed at the end of 2021, we have launched a pilot project to introduce HVO, which stands for hydro-treated vegetable oil in the bunkering of vessels that serve our activities in the French Guiana zone. Now moving on to Rubis renewable lab, and this is a brand-new branch, Rubis renewables, which was consolidated starting April 2022. So talking about Rubis renewable lab, particularly subsidiary Rubis Photosol. So like I said, we consolidated it in April 2022. So it's been in our accounts for 9 months. The integration process is off to a good start. Power generation is on track and has grown by over 30% in 2022 compared to the year before. And the entity has contributed EUR 18 million to the group's EBITDA in 2022. So this has been a busy year for renewables with a strong development pipeline, as we will see on the next slide. To support these projects, we have shored up our teams, particularly in the development area. Our headcount is up. At the end of the year, Rubis Photosol acquired a solar rooftop specialist called Mobexi. So they make rooftops and canopies for professional use. And this has opened up many development opportunities for the group, both in terms of converting our size to solar and also cross-selling potential with their business customers. At the beginning of 2023, Rubis Photosol also announced the signing of its first corporate PPA or power purchase agreements with the do-it-yourself player [indiscernible] This first foray into the corporate PPA segment is part of a long-term strategy to diversify outlets for power plants, and this is particularly important for Photosol's future development. For 2023, we plan to implement the group's CSR road map in our subsidiary, Rubis renewable lab. We have already started working on a full carbon audit of its activities, Photosol's activities. So this slide gives you a review of the group's solar project pipeline. You will notice that projects at the advanced stages have grown by more than 35% compared to 2021, which shows how active our teams are. It also means strong potential for future expansion of these installations. The major projects commissioned in 2022 are 50 and 17 megawatts, respectively, and they're located in the [indiscernible] regions. Now I would like to focus on the overall environment of the French market for renewable energies. I also wish to explain what this means for Rubis Photosol and Rubis renewable lab. It's no secret. The European Union and therefore, the French government intend to support the energy transition. However, the market is moving faster than them. And this means major bottlenecks for those administrations and for the entities capable of connecting the power plants to the grid. The time required to secure building permits has recently jumped from 12 to 18 months, depending on the area. In addition, module costs and construction costs have surged by about 15% over the year. So what have we done to respond to these externalities and to prepare for the future -- we've taken a number of measures. First of all, Rubis Photosol made sure as allowed by the latest government measures to sell electricity at market price during the first 18 months of its CRE contracts. -- and the first positive impacts were felt at the end of 2022. For Photosol, this means about 120 megawatts in installed capacity. In order to optimize the process of applying for building permits and save time on the consultation phases, Rubis Photosol has strengthened the team in charge of that phase. And in order to secure module supply, a number of framework agreements have been set up with a number of suppliers, most of them Americans. Finally, Rubis Photosol has worked really hard to lay the groundwork for the future by developing joint offers with Rubis Energy. We talked about that, whether in France or in the Caribbean, but also worked on deploying solar rooftops and canopies, thanks to the Mobexi acquisition. And also worked on expanding internationally and in Europe, I'm not going to spend too much time on that because which is getting started. But the team is proceeding at pace, trying to move into a number of European countries when it comes to the solar market. And Rubis Photosol is also looking at the technologies of the future, particularly when it comes to storage projects. Not just storage, hydrogen as well. So it is important to emphasize that these projects as ambitious as they are, are expected to self-finance. The French environment that I have just described is bound to impact the time line of our goals, as mentioned earlier, but those are temporary setbacks and we expect to catch up. So what we announced in 2022, well, we have to push it back by 1 year. To conclude on the renewable output segment, I will quickly mention our investment in HDF I already talked about the project in Barbados and also mentioned that our project in French Guiana is still under construction. Let's close the chapter with our storage activities, our Rubis Terminal JV. So the business is doing well with revenue growth at plus 6%. And in line with 2021, 2022 saw the acceleration of biofuels and chemicals. Overall, all nonfossil fuel products enjoy double-digit growth in 2022. Rubis Terminal did remarkable work this year to change its product mix up until recently, Storage accounted for 75% of fossil fuels and now that 70% has dropped down to 40% fossil fuels, account for just 40% of our storage mix. So three main highlights this year, the set of our Turkish Terminal, which generated a capital gain of EUR 19 million for Rubis Terminal and also the refinancing of EUR 560 million in high-yield bonds, which were added to the bilateral debt of certain subsidiaries. And these debts were replaced by infrastructure financing, including ESG criteria for a total amount of [indiscernible]. So we're developing new chemicals capacities in our region. We have new expansion projects in Spain for one of our terminals, but also there's a new zone in the southern part of Spain. Rubis terminal has also published its first sustainability report in its first road map, which are available on their website, if you'd like to check it out. And now I'd like to hand over to Bruno.

Good evening to you all. I'm not going to swampy with figures because we've already spent 30 minutes on those. So we're going to move straight to the financials that Jacques and Clarisse have extensively covered his cascade of EBITDA down to net income. You'll have noted strong respective growth of EBITDA and EBIT at 26% and 30% respectively it's true that it's rather exceptional for Rubis without the acquisition because the acquisition of Photosol only in 9 months and has only just beginning to produce doesn't impact strongly the growth of EBITDA and EBIT, but we can say that on the one hand, we are in a position to pass through to the end user, a large part of the price increases, product increases. I mean the products doubled on average from '21 to '22 of refined products. So you have that EBITDA and EBIT impact, but above all, as we presented to you earlier, we experienced a rather unusual year regarding ForEx fluctuation in emerging countries, Kenya, Madagascar or in Nigeria. And we've got 2 types of markets, some markets that are free in terms of price setting and the regulated markets for the regular markets, we have no leeway because the regulation is decided and crafted and formulated through a price formula put in place by governments, which has led countries such as Kenya or Madagascar, these 2 countries cap the sale price. So it happened that same year, those -- both those countries were in electoral process that doesn't help. And so we suffered the price back -- price cap just when prices were increasing substantially, but the government in return offers a subsidy to the distributors that we ended up with expected subsidy receipts from the government and in certain countries. In fact, in all countries, it was paid, but with a certain lag over time. And since we needed to convert the receipts in the local currency to pay the supply, then we suffered currency translation losses in countries such as Kenya or Madagascar, you'll see the -- in terms of the ForEx losses, they went from EUR 11 million to [ EUR 80 ] million on the year. So that is a pretty strange situation in the market. But we're also present in unregulated markets, which allowed us to increase our margins. And in countries such as Nigeria in Africa we are faced with a currency that is depreciating chronically versus the dollar, the dollar that was widely sought after in all these economy. So we're faced with a shortage of dollars that was exacerbated because the countries produce a little few dollars, few exports with a doubling of the price of oil imported increasing demand for dollars. In countries such as Nigeria, what we're able to do was to incorporate the sale price to the end user, as the ForEx risk by upping the tariff, the price. So we end up with an EBITDA in Nigeria, up EUR 33 million, but the currency risk that was taken and was booked among the EUR 70 million in currency losses to the tune of some EUR 33 million. So that impact we translated and we reflected through the 30% EBIT growth that we correct to the tune of 21%. If we take account of the Nigerian effect where we had an additional EUR 30 million in margin and EUR 30 million in currency losses in the financial expenses. So it's a rather unusual situation. The final word here is that the distributor -- isn't there to subsidize customers and he passes on, he passes through full price volatility to the end customer. That's how it works. And that's what happened in Nigeria. In the other countries, well, we have no other choice than to negotiate with government agreements memorandum. So through the subsidy because the price is administered with a fixed margin, and it's the subsidy that covers the currency risk. So we're in discussions with the other African states. In order to receive the loss of profit linked to the currency loss that you see in the net financial expense for the year. Aside from that, when we move down the cascade of results, you have the share of associates, essentially Rubis Terminal for some [indiscernible] and whose CEO is present with us, is in attendance. It's very unusual to have you with us Rubis terminal. As Clarisse indicated, delivered an excellent year with net accounts, the impact of the disposal of Turkey that generated a capital gain offset by the exceptional financial expenses linked to the refinancing of a bond instrument that was in place for more banking instrument that was delivered successfully during the course of the year. And when we've restated here from associates there, we've restated we've amended to take account of those 2 events. Exceptional cost income and expenses from [indiscernible] of the goodwill impairment in respect of Haiti, as Clarisse discussed and added to that, there's some EUR 20 million of costs linked to the acquisition of Photosol, the form of management incentive plan and acquisition cost for the first, which is the bulk, it's part of the price, and it was amortized specifically over 12 months. So the 3/4 of this expense was booked in 2022 and only one quarter for Q1 '21 because it's amortized over one year. So those are the exceptional expenses, financial expense -- well, we've discussed those interest expense almost doubled. We had a portion linked to the Photosol's Scope -- EUR 7 million in financial expenses linked to its solar Park and PV that were funded through debt. The acquisition price of Photosol cash out of EUR 400 million plus the debt within Photosol, some EUR 800 million in assets to be financed. And between April and December, generated additional interest and then you have a slight impact of rising interest rates, that's general from '21 through '22. Currency losses. We discussed those tax rate remains between 17%, 19%. We've given you a tax rate closer to reality if we take account of the goodwill impairment that is not tax deductible, and we have the adjusted net income of these all these adjustments made. We obtained our EUR 326 million net income, 11% up versus the adjusted net income of EUR 21 million at EUR 293 million, up 16% over the previous year. So, so much for the cascade of financial results and then shown here a focus on the debt -- net debt development. At the beginning of the year of EUR 438 million it's negative cash flow, obviously, because it destroys debt in the flows. It's a negative flow. And shown here, EUR 31 million, that's the change in working capital over the year, that's an increase. The CapEx, EUR 259 million, as we saw Rubis Energy for some EUR 215 million and the balance, EUR 44 million on Photosol. The dividend for the year that was paid out in 2022 for EUR 202 million. Acquisition of Photosol once again of EUR 340 million. Photosol stock and then other items integrating Photosol, EUR 94 million. For the corporate net debt, all the debt that is excluding the nonrecourse debt that is housed in the PV renewable plants, and this EUR 239 million gives us net debt-EBITDA ratio modest of 1.5x, which, of course, leaves the group additional debt to fund M&A transactions. Moving on, we take account of the EUR 357 million of debt or in all the solar plants to arrive at the 1,286 reported in the balance sheet with a net debt-to-EBITDA ratio of 2x. Figure that remains modest, recognizing that a large part of this debt, a quarter is a debt that is housed in the PV plants. I mentioned the strong balance sheet and also liquidity, essential in the present period, and this is made possible through the EUR 480 million available RCF that we have available, confirmed in the group. So those are the few points. Those are the few insight. I wish to give you on the financials. Perhaps we can continue. Moving on with Fred Royer, who's going to introduce himself. He'll do that better than anyone. Focus on bitumen. So just return for a second to bitumen, 2015, 7 years ago now, Rubis identified a new niche sector in its business from petroleum products because we were in LPG, fuel, aviation, lubricants and bitumens part of what is producers in the distillation column and bitumen. Well, this product was identified its characteristics, so broadly seminal to LPG, original business. It's a niche business this time. It's not B2C. It's a B2B niche business for professionals with constraints characteristics such that we kind of replicate the setup and the pattern of logistics that we had LPG, a complex product that is stored not as readily as liquid. This is bitumen needs to be heated. It is a bit like hard chocolate is transported in conditions, in rather specific types of vessels, with a heating system and the associated logistics is essential and is the competitive advantage of this business. So we identified this product, this company when we founded in Nigeria, 80% of -- it represents 80% of volume at a total of 300,000 tonnes distributed every year. And at the time, we acquired this company for EUR 265 million. That's a P of 10x. And in 2015, and then I'm going to hand over to Fred to describe what he's done since he came on board.

Thank you, Bruno, for this kind of introduction. Good evening, everyone. My name is Fred Royer, I'd like to say a few words about my track record. I have 24 years of experience in the downstream oil industry. So like I said, I have 24 years of experience in the downstream oil industry, including 17 years with the Rubis Group. At Rubis, I had the opportunity to work in different geographic areas, including Europe to Caribbean Africa. And I'm now based in Dubai and from Dubai, I managed the group's bitumen activities. During my career at Rubis, I have developed expertise in restructuring and the integration of companies. In particular, I have been involved in the acquisition and consolidation of many Shell and Chevron assets, particularly in the Caribbean. I have also managed the restructuring of our Southern African operations, which enabled us to become the LPG market leader in the region. I joined the bitumen division in 2018 and are focused on developing our sales, expanding our business into new African markets as well as optimizing our logistics assets. I suggest we watch a short video about our activities. [Presentation]

As you can see, bitumen comes from refining crude oil. It is a residue from the vacuum distillation column and some oil crude is suitable for -- more suitable for producing bitumen. These are the so-called heavy crudes. In Africa, there are very few refineries and even fewer refineries capable of producing bitumen because African crude oil is light, a bit like Bonny light in Nigeria. And this is an opportunity because from a structural point of view, these markets import most of their bitumen. So as we said before, this is a residue from refining, but it's not something that you can burn. It's not a fuel because the carbon is sequestered. And this is important for our development. At Rubis asphalt, we source our bitumen mainly from the Mediterranean countries, including Spain, Greece and Turkey, to ensure stable bitumen grade as well as security of supply. So what are the main applications for bitumen? There are two main ones, mostly road construction and -- well, road construction accounts for 90% or 95% of the applications. And the other application is building waterproofing, especially roofing, and that's about 5%. In Africa, we focus solely on the road infrastructure market, where bitumen is an essential commodity. It is a material that can be adhesive, cohesive, waterproof and strong. It generally makes up about 5% of the asphalt layer, what we call the wearing course, which consists of aggregates and sand. In short, bitumen is a binder. So like we said, it makes a [ 5% ] of the asphalt layer, but it comes for 30% of the cost of the road. So supply of bitumen is an important factor for road builders. Our customers are mostly B2B customers, and they include public works companies that specialize in infrastructure, mostly multinationals. So customer-related risks are low. Market depth is significant because developing road infrastructure in Sub-Saharan Africa is key to opening up a number of regions and freeing up the economy. In addition, population growth is creating a significant need for mobility solutions. For example, Nigeria's population is growing at a rate of 5 million inhabitants per year. So we're talking 2% to 3% growth every year, and this means we need to create infrastructure to keep up with that kind of growth. And you will notice on the slide in the bottom right-hand corner that the road network in Africa -- Sub-Saharan Africa is underdeveloped, we are talking about 140 meters per square kilometer of road. And this means there's huge growth potential. Now we're not expecting that Africa will ever reach the density level of Asia or Southern Asia. But we are hoping to get closer to the kind of density that we find in North America. So within the next 15 to 20 years, we're hoping to get closer to 300 meters per square kilometer. Amid this backdrop, what sets us apart from the competition is our mastery of the entire supply chain. And this allows us to deliver solutions to our customers wherever they need. So asphalt plants on their sites, we meet the deadlines that we provide, the quantities requested. We have an integrated value chain, which includes bitumen vessels. In particular, we have the 2 largest bitumen vessels in the world, and this means we can efficiently bridge the gap between European refineries and Sub-Saharan Africa. And we also have import terminals, where we keep a permanent inventory for our customers. And finally, we provide land logistics. We've multimodal transport to deliver the bitumen direct to our customers. So this is a capital-intensive business, which means barriers to entry for new players. Moreover, because of our leadership position, this means economies of scale. We have a bespoke approach to our customers. We provide bitumen and derivatives that meet their specifications and their terms of reference. We are able to supply not only bitumen but also, [ emotions ], all of the bitumen derivatives, which include [ emotions ] and PMBs, PMB stands for Polymer Modified Bitumens. So products that match the characteristics of the projects, so secondary roles or heavy load roads, where there's a lot of HEVs, heavy goods vehicles or even freeways and highways or airport runways or mine runways. So every road will require a very specific type of bitumen. So we adapt our output in our services, based on customer needs. In addition, with our dedicated and local teams, we have between 500 and 600 employees in Africa, we are able to provide technical support throughout the roadworks process, so we provide a turnkey solution, and we also provide aftersales service. Since the acquisition of [ ARRIS ] in 2015, we have strived to expand our sales and diversify our locations by opening in new countries. As we said before, Nigeria is driving our business. Nevertheless, it is important to derisk our exposure to Nigeria, both in terms of volume in financial terms and in terms of currency, in terms of ForEx exposure. So we are riding on the back of a tremendous sales boom in the Togo subregion, particularly in Benin, Niger, and Ghana. Those countries have very ambitious policies in terms of infrastructure development. In the past 5 years, as you can see on the screen, we have also opened 5 subsidiaries. Cameroon in 2018, followed by Gabon, Liberia and South Africa in 2021. And recently, Angola in 2023. And those new markets represents 72,000 tonnes in 2022, and we plan to reach sales between 150,000 and 200,000 tonnes by 2024 in those new markets, to give you some idea. This represents about 20% growth in our overall volumes distributed in Africa. So our strategy is simple. We are planning to be the go-to supplier on the entire Atlantic Coast of Africa. We are recognized as a bitumen specialist in Africa and the market leader. We have market share of over 50% in all the countries where we operate. And those market share targets are usually achieved after 2 or 4 years of operation. It depends on the country's configuration. It also depends on the competition. And we're also in a position to adapt our logistics model based on the size of each market. Since 2016, our distributed volumes have almost doubled from 250,000 in 2016, which wasn't a very good year, to 450,000 tons of products sold to our customers in Africa by 2022. We have also developed key partnerships, including Sogea Satom, which is a subsidiary of the VINCI Group. We supply them -- we supply products to them for all our road projects in the greater West African region. And also Colas, which is a subsidiary of the Bouygues Group, we recently signed a supply agreement in South Africa. And we're also looking at other potential logistics synergies between our 2 groups. As you can see, in terms of our business, the volumes are different than our service stations, for sure. Growth is not stable. Things are very cyclical. It all depends on the policy in each country, and that is why it is important for us to branch out to have a variety of different geographic areas so that we reduce our exposure to political turbulence in one country or another. We have also innovated and expanded our offer by proposing new products such as PMBs, like I said, it stands for Polymer Modified Bitumens, as well as emulsions, particularly different mines. And those technologies, which are generally used in more mature markets, enable us to support our customers in a broader and more sustainable way. And they also enable us to generate higher margins with higher value-added products. Finally, we're investing to develop our logistics because logistics is key in particular, our vessels to improve efficiency and support our growth. Like I said, Africa has a very low bitumen supplies and usually they import bitumen from a year, then you need vessels to transport the bitumen all the way from Europe to Africa. So at the end 2022, we took delivery of a new 15,000 tonne vessel. And that vessel is especially designed to supply Nigeria efficiently. You got to understand that in Nigeria, the rivers have a very low traft. And this means a very specific vessel design. So our supply to Nigeria will be more and more efficient. We're also securing the building of a new 17,000-tonne vessel to support growth in Southern Africa, and this includes Angola and South Africa. All of those developments translate into growth in net income of 26% per year since 2016, between 2016 and 2022, reaching net income of EUR 65 million in 2022, with a return on capital employed of over 20%. As we look to the future, can we expect from the bitumen business? Well, first, there is significant growth potential in South Africa and in Angola, where our operations are just starting up. At the moment, we're building a new storage facility for bitumen in [ Durban ]. There's no one else there yet. We're the first, and so we're going to gain significant market share in South Africa, where the landscape has changed. They used to have refineries and export bitumen. That was one of the few African countries that had refineries. And now those refineries have shut down, and now they need to import bitumen. And we were among the first to seize that opportunity. We already have a terminal -- import terminal in Cape Town, and we're building another one in [ Durban ]. So our goal is to increase our sales by 100,000 tonnes by 2024 over the next 2 years, as we said before. This means 20% growth in terms of our volumes distributed in Africa. As you can see on the map, our scope of action is not limited to the countries where we have operations, where we have locations. For example, we're able to deliver to neighboring countries by truck, in the dark blue areas, for example. Also we will pursue our geographic expansion with new locations. So on the slide, those are the areas in light blue. It's an important market, but we need to find assets I'm referring to the DRC, the Democratic Republic of the Congo, it's a big market but a tricky one. So we're looking at setting up shop in the next few months. We're also keeping an eye on the Congo and Namibia by 2025. Now East Africa, we -- there's real growth potential there because we already have Rubis activities in the fuel sector there. However, there's stopping -- there's something stopping us from growing East Africa because the original source of natural bitumen for East Africa is Iran. And because of the embargo on Iran, we can't really move into that market. But once the embargo is lifted, we'll be ready. We will continue to develop complementary products to bitumen and improve the existing offer. We talked about PMBs. Those products are used to improve road elasticity and therefore, thermal stability, which is key in those regions, which are subject to significant temperature variations. And lastly, we're going to leverage our logistics assets as much as possible, our a mastery of the logistics chain to take advantage trading opportunities that arise, particularly during Africa's raining season, when road construction efforts are slowed down. In particular, we have opportunities in the USA, where we have regular trading flows with American customers. Finally, we keep an eye on M&A opportunities, and we will not hesitate to position ourselves as a player as markets consolidate, whether in Africa or elsewhere. Let's wrap up. Bitumen is perfectly aligned with Rubis' DNA. It's a niche product in growing markets with high barriers to entry and the structural import needs. Whatever we use to power the cars of the future, the world will need modern and efficient roads. And we are particularly well positioned, thanks to our mastery of the entire supply chain and our operation in excellence. The strength of our model is borne out by our robust market share, over 50% in all our locations. We are growing strongly in new markets. Our financial performance has been steadily improving since the acquisition, with over 20% return on capital employed. So Africa still holds significant growth potential, and we play a leading role there. Many thanks for your attention. I will be happy answer any questions you may have later on. But before we do that, I'd like to hand over to Clarisse, who will wrap up this presentation. Thank you.

So I'm going to close this presentation with a few words. As you will have noticed, it's once again a year that we view as extremely active for the group, and the results have been delivered, excellent operational perform, needs to be underscored. We're also pleased to be able to propose an ever-growing dividend. It's a way for us of rewarding your trust and your support. Turning to the future and the outlook going forward for the group, regarding our energy distribution activities, we're going to continue to work to strengthen our existing strategic positions, new offerings, divesting in our markets and investing where it makes the most sense, distribution, primarily, Africa, Caribbean. We remain convinced that the energy we distribute can't be the same everywhere we operate and must meet our customers' need. That's also why we acquired Photosol to turn to renewables in Europe. In renewable power generation, growth will be driven by the energy transition accross our geographies. We see major solar expansion opportunities in several European geographies with Photosol. The carbon reduction of the energy mix is a major challenge for us, but also in geographically isolated areas such as the Caribbean islands. And we're contributing and convinced that we're going to be able to contribute to that, notably with HDF Energy storage business. We're going to continue to support clients in their energy transition as we've done for some years, known by adapting our storage capacity and continuing to write the group story. In the M&A front, we remain attentive to acquisition opportunities that may arise across our businesses. Before closing this presentation and opening it up for Q&A, for '23, we expect increased results versus '22. Continue to grow our dividend has been the case for many years now, in fact, since the group was founded. This concludes this session. Thanks very much for your attention, and Q&A session is now open.

Thank you. Hope you can hear me, yes. So could you just return briefly to your M&A policy just to accelerate in solar power? Is it then on a need by kind of going to the market? Or will all developments happen with the current balance sheet? In fact, how far are you prepared to go in terms of leverage? Perhaps if you could assist us on that one, Bruno. And also the [ lore ] on accelerating renewable energy in France, is it positive, is it negative? What's your take as we seem to be hearing a lot of things on this front. Are you really supported by the authorities here? Final question is on your CapEx in '23. Could you tell us what your budget is as compared to the EUR 259 million CapEx budget last year?

Well, thanks for that question. Acquisitions in the renewable in PV, we believe that we further saw we have what it takes. We have the critical mass. We have the enabler to grow on the basis of the structure of Photosol, 120 people, #3 independent in France after the major leaders, NG, EDF, those who are present, we have the ideal to grow from Photosol. So expansion, we view it more in organic terms by building on new teams, by expanding if we do it in foreign countries, not necessarily through acquisition but through sales, development partnerships. We can also view expansion horizontally by pushing beyond solar -- the traditional solar PV farm storage, what's known as repowering when we come to the end of the life cycle of a plant, reinvesting with more efficient tools and with profitability rates that are higher than -- at entry. Same part of your question, the group's financial capacity. Well, today at Photosol, we have CapEx program of EUR 700 million between '22 through '26. See, EUR 700 million will be almost self-financed through bank facilities without drawing on new shareholder money. The PV market in France, we're familiar with regulatory setup, the guarantee of the business through long-term contracts and to have quality counterparties, thinking of the CRE, that gives us a possibility of financial leverage of 90%, even 100%. Hence, Rubis, where with all self-reliance to -- we are not going to have a second [ vertical ] ticket. It doesn't make sense. We have the team. We got the expertise, the platform. That's a message I'd like to convey. Your second question, that's crucially important, which is the acceleration or the deceleration law, it's the people behind you that are going to speak to that. They're the experts, and they've worked live in parliament to get this bill on the statute. David Guinard, CEO of Photosol, participated a great deal on these discussions, on the acceleration law that occupied a great our time, the second half of '22. And I'm sure that most of the industry players have expressed their views in the media during the parliamentary process after the work in the house and the senate. The result, the outcome is probably a bit disappointing in terms of what we were expecting regarding energy or environmental transition, its uses, the looming [ deceleration ] is very important because it is the first time in 15 years of Photosol's existence, 16, 17 years of existence of the PV market. And for us, first time, law has clearly stated the need of accelerating the process in France, one framework, defining the PV. For those of you who are here, I gave a briefing that Photosol was really something of a trailblazer back in '08, '09 and '10 and this regulatory framework that's going to open up the land, that was one of the sticking points. It's going to open it up to PV expansion is key. Second driver, equally fundamental, is the work of consultation that was mentioned at the presentation, is framed by articles on acceleration, definition by the [indiscernible] and the communities of these acceleration areas that will offset the major difficulty that we're faced with in France, which is the duration of admin authorization. So there'll be a shorter development cycle. And these two crucial items in the acceleration process, we could have hoped for more ambition, but we are a bit disappointed. Now the French market, and David can confirm this, is quite exceptional in many respects because you see the mechanic, we have buyer that's double or AAA that we find nowhere else, which means that we can find a very long-term funding at very low rates. We've got a very low cost of capital. And as Bruno said, David Guinard, from 90% or even 100%, depending on the deals of investments achieved. Of course, the over side is that there's a lot of administrative red tape. But if there's one market where we'd like to be, it is the French market. I wouldn't say the same for all product, but I'm happy to say that. And as you know, ambitious in terms of multiplying installed capacity is considerable and extensively exceed the wildest dreams of an operator, not to mention prospects in other European geographies. When we move further away, there are all sorts of setups with markets that offer shorter contract durations or higher equity levels. When you move to emerging markets, it's a totally different ball game because you have a lot of difficulty finding counter parties to acquire the electricity, who can sign up reliably for a long-term contract, it's a different take. It's a bit more corporate, a bit more conventional. So for these electricity markets, depending on these convention, can be addressed with different tools and teams. And that's what will make the attraction of Photosol. And the team has done an outstand job because, as we said, they're both suited to a listed structure, which is no [ mean ] feat for a binary on-off company. That was done this summer. And they've Already launched sales initiatives to address new countries.

I'll take a few questions coming to us online. Picking up on Photosol, we have a question from [ Andreas ]. If farm [ down ] possibilities are on the cards to reduce the project risk and [ partly ] fund the project implementation?

Maybe we'll let our specialist answer that one.

On the farm down. Well, we're fortunate to have 2 founders and managers of Photosol, Rubis Photosol since you're inviting me.

So good evening, [indiscernible], Co-Founder of Photosol partnering with David and Rubis. Maybe just a technical clarification that farm-down involves selling assets, minority sale to purely financial investors. That's what the practice, a very low cost of capital seeking very long-term returns, the attraction of farm down can if it's your point, but it really involves derisking when we hold assets where we have -- we're committed for 20 years with a counterparty. In the French case, as Jacques said, we're benefiting from a pretty outstanding environment, very different from other geographies because our main buyer up until in fact, are sold by recently was EDF's French utility. Recently, Leroy Merlin with the signing of a PPA of 38-megawatt. Photosol retained its assets and didn't do farm down up to now. Over the coming years, given our pipeline. And as Bruno and Jacques said, we can fund our plants with a leverage of 80%, 90%, 100%. We don't need to sell assets and farm down to find liquidity in France, farm down is in a way of derisking because the counter parties excellence at least that's our viewpoint. Another geographies because it was said we plan to develop other geographies, but it'd really be done on a country-by-country basis.

More questions coming to us online. What's the WCR trajectory post '23 after the decrease in price of raw materials out of '22?

Well, the answer lies in the question because if there's a withdrawal, a decrease in the raw material price, it will reduce inventory and receivables that will generate cash. So we may have experienced the peak and WC over the past 2 years, '21, '22, and we'll begin '23 and better conditions in that respect.

The next question, the EUR 700 million CapEx that you -- is that equity? Or is it total physical investment?

It's a physical investment, 100% construction of the plants buying, building the assets, finance that will require funding either equity or debt, but we have the advantage of using maximum debt.

Okay. So second question on your relations with HDF, you've invested a certain entry price that was far higher. What are your relation? Is it the ticket that you put in to be in the downstream business? Or is it something else? And what do you think of that investment?

I'll answer because I'm a member of the HDF Energy Board. We invested EUR 80 million in HDF Energy about 18 months ago, essentially to be able to revert in hydrogen power plants in areas where we're present. So today, we can say that there are projects in all areas in which we operate but with more substantial pipeline in the Caribbean, that's allowed us to have a strategic partnership protocol with HDF, which means that we have a 100% decision to invest as priority and as a majority partner in the geographies where we're located, are we happy or not? It's too soon to say when you see that Photosol so that's an integrated player in the French landscape that's often wins. The CRE tenders takes about 4 to 5 years to develop a conventional solar power plant in France. The lead time for HDF is very long. There's one plant under construction. Another plant in advanced development, many other plants, but the maturity of which doesn't allow us to talk about. So it's a bit short for us, but too soon for us to form a view on the matter. I don't know if that's answered your question frankly.

Yes, it's a total or this type of activity. It doesn't exist the plant that's under construction in French Guyana is an industrial model that combines PV planners, hydrolyze, fuel cells can develop 24/7 power. It's a pretty unique facility that's going to emerge and it requires, as Clarisse said, building this pipeline over a number of years, 4, 5 years to develop that, then there's sort of accumulation of projects. And you see it was, in fact, the case that Photosol and for all operators from this, you see the -- you see the curve take off. That's the principle of the operation.

As Clarisse [indiscernible]. We have a written agreement just completely above board for an agreement under which they have a commitment to our regions, Europe, the Caribbean, Africa, these are areas that's the whole lot of potential, and there will be priority majority investors. These are regions where we decide not to go, depending on the characteristics and depending on our mood. So the answer is no. The answer is no. There is no way is going to increase its stake in HDF, we hold 18% that puts us in the second position. The idea is for us to invest into SPV that generate power, but not in the parent company. At our level, there's leverage when it comes to developing the power plants.

Hello, could you please clarify on the bitumen front, you said that you pay close attention to potential M&A opportunities. Are you in the middle of discussions as we speak? Could we have some indication of the size of your potential acquisitions?

Well no, we're not in discussion exactly. Everything we did so far was ex nihilo. It was about blazing the trail in Africa. We're specialized in that actually. And there are many M&A opportunities that can be seized in Africa because it's a growing market. Africa is a market where road infrastructure is gaining ground. And the money comes from finished years, donors. So we believe that our organic growth and our growth from 0 will make quite a contribution to our general growth in the next few years. When it comes to mergers and acquisitions, well, probably in other regions. We're looking at various potential acquisitions, but it's still early days. It's too soon to tell you about it. In Europe, for example. We can tell you that the landscape is shifting. A number of refineries that produce bitumen are probably going to close. So we're looking at Europe, particularly in Northwestern Europe with a pay close attention to that...

More on bitumen. I have a question. EUR 60 million in net income, EUR 65 million, actually apologies. That's a lot as a share for the group. So what about operating income, operating profit? Are we dealing with this income ratio?

EUR 80 million EBITDA or be in French. Yes, absolutely. Our EBITDA is very healthy. But at least in part, and I think that Bruno noticed that in part, our EBITDA is distorted by Nigeria because our profit margins are significant. Now we have to absorb the financial cost of buying dollars on so-called parallel markets. But because of the underlying ForEx loss, the EUR 80 million in EBITDA. So we're talking EUR 30 million for bitumen. Yes, exactly. If I understand properly, that principal, the ForEx losses, you need to think about that, but only after the ForEx impact. And this is why we prefer to talk about our net profit as opposed to EBITDA because I do feel that EBITDA is a bit inflated. EUR 80 million in EBITDA, that's a once it's been adjusted for the ForEx loss.

Okay. Also on the economic front, bitumen is a residue. It's a petroleum product residue and we should see a reduction in consumption of such petroleum products, gasoline, in particular. So what's the impact on the price at which you buy bitumen? Is that price defined by the buyer that is by you? Or does it depend on it bitumen price activations? And do you think there's going to be a shift in the long term?

Yes, absolutely right. It's correlated with the price of crude. Now the underlying factor is heavy fuel for bitumen. Okay, that's the main marker. So we buy bitumen based on so-called price contracts. Something like 5% crude rule. Now the shifts are difficult to predict. What we're seeing today, and that's one of our top challenges. We expect a number of refineries to close in the future. Either close or convert to something else? That's the rationale. So our objective is to secure the molecule. The actual bitumen, so that we can continue to operate as a going concern in Africa and elsewhere. So there are lots of opportunities that we're looking at. There are refineries that have decided to specialize in bitumen. Because the more complex refineries have a choice. We need to decide on the final mix, and there are some refineries that specialize in bitumen and they're now producing much more bitumen than they used to. Okay. Buying up a refinery, maybe that's something you should talk to Jacques about. Some people have tried and many have failed. You need to be really careful when buying a bitumen refinery. Honestly, it's not good for your health. That's not the count of sport you need to play if you want to stay healthy, but that are more specific downstream activities whereby you use these products, these -- the byproducts refinery, it's much more a specialist business.

Now bitumen it like any other energy product?

There is a strategic aspect to it is fascinating.

So over the long term, your profit margin is high?

Assuming you managed to pass on the rise in international prices on to your end customers. Now because we're working longer distances between the bitumen producing areas and the consuming areas. Those regions that need bitumen in order to build new infrastructure, you need vessels to go from A to B. And we are one of very few operators that have excellent tools and facilities because those vessels that I'm referring to, we are using them for our own supply needs. But during other periods at other times throughout the year, we use our tankers to, okay, when the trading window opens, to supply the Americas.

So we're talking 40,000-tonne vessels?

Yes, but the new vessels that are currently being built range between $30 million and $35 million, at least.

I have another question online, regarding the bitumen business. What about natural bitumen? Are they an option? Natural bitumens isn't that an option?

Yes, they do exist, those natural bitumen and fortunately, it's more -- it's more theory than practice. As far as I know, there are no natural bitumens that it can be used directly the same way that traditional bitumens can. There are natural bitumen deposits in some countries, including Nigeria. And of course, tar sands in Canada, but of course, you need a whole refining process. You can't use it as such. You have to refine the natural bitumen before you can use it.

Okay. More questions online. If you look at the ForEx loss posted in 2022, do you intend to set up the currency hedging policy?

If that was possible, we would have done it. I told you about the different currencies, shillings, naira, the Madagascar currency, there are no futures markets for these currencies at the moment. At the end of the day, the best way to hedge our bets is to transfer price volatility, pass on price volatility on to our end customers.

More about ForEx. The EUR 80 million in ForEx loss in 2023, are you planning to recover it as part of your discussions with the government?

Out of the EUR 80 million, there's only EUR 50 million left. And out of the EUR 50 million, there was EUR 10 million, so maybe 10 million a year. So basically, we're down to EUR 40 million. And when it comes to the remaining EUR 40 million, we have started discussions with a number of governments to recover at least part of our financial loss. You got to understand that this is a game that's been going on for about 100 years between petroleum operators and governments. We all need each other. But there are times when governments were in distress when prices rise too high and too quickly. And then, of course, they're tempted to regulate. They do it in Africa, but they do it elsewhere as well, as you all know, right here in Paris and in many other countries. But as you know, well, actually, everybody knows that they need each other, okay? Governments need reliable long-term partners and operators. So they're willing to negotiate. And you always want to come on ground. But it takes a little while. As Bruno was saying early on. So you may have a free pretty priced markets for regulated markets and it takes a little longer and that, of course, we have to negotiate. You don't always get everything that you want. And of course -- but it's a long-term partnership that we have with those governments.

I believe we have Guillaume Muros, Société Générale has a question she wants to ask on the phone.

I have 3 questions. Firstly could you please talk to me about your working capital requirement, which was positive in Q2 and at the end of 2022. Actually made in H2. Second question, regarding renewables. The Photosol acquisition, you set up the medium-term objective by 2025, you won a contribution of about 25% renewables should contribute 25% to the Group's EBIT. What about the time line? Are you maintaining that goal? Third question, your corporate net debt. Do you have a target leverage?

Very well. I'll take the last question. The net debt over the corporate net debt over EBITDA ratio. So 1.5x at the end of last year and we said that our borrowing capacity is about EUR 300 million to EUR 400 million. So what does that mean? It means we can get close to 2x or 2.1x that's where we stand. Okay. We can shift from 1.5x to 2x or 2.2x. So we're talking 0.6x, that's about 50% of an EBITDA around. So we're talking EUR 300 million, EUR 400 million. When it comes to working capital requirement and changes thereof. You know that in H2, there's a drop in that WCR. Now 2022 is not usual as a year because there's a condition between, first of all, the -- there's a combination of factors at the end of the 3-year period for posting the C2Es in the balance sheet of companies such as ours, which distribute energy and which therefore have an obligation to manage your position in terms of energy efficiency certificate. And at the end of the period, something happened. The accounting processing of that -- the certificates, exiting the inventory had a contribution of about EUR 200 million to the loss to the drop in WCR. So that's a technical explanation that explains the drop in WCR in the second half of the year. When it comes to renewables, all right, the question had to do with the medium-term goal. We never made a commitment by 2027. Medium term to us that means 2030 and beyond. So we're not going to reneg on the 25% contribution to the group's EBITDA by 2030, not 2025.

I still have a couple of more questions online, considering the increase in interest rates, are you planning to shift borrowing instruments in your capital structure? What is the split between fixed rate and variable rate?

Now in terms of the Photosol acquisition, we're taking EUR 360 million in Photosol debt. On total leverage here. So this is very long-term debt 20 years. And that debt is hedged from the get go. In other words, we have hedged our debts. We have hedging instruments for the entire duration of that loan and the loans are capped. So we're not expecting any negative impact from the increase in interest rates when it comes to ongoing loans. As far as the future is concerned, of course, there's going to be an exposure to surging interest rates. But of course, it's part of the project's economics. It will be factored in some point into the price per megawatt. That's something we will be working on. We will work on this as far as future projects are concerned with the corporate PPAs or other RFPs. When it comes to the entire corporate debt that is housed within Rubi Energy. Of course, the material level is different. It's not 20 years like for Photosol. On average, it ranges between 6 and 7 years. So today, the average time drew which stays in our balance sheet is about 4 years. So that debt is hedged from the beginning. As soon as we set up the loan and whenever we draw down on the revolving credit facility, the RCF, we're talking between 70%, 90% of exposure to the rate. So that's my answer.

Another question on the capital, the ramp-up of CapEx, is it compatible with the dividend amount. The different geographies that might be affected possible acquisitions?

Yes, it's been a constant policy at Rubis to protect not only the dividend, but also the dividend increase. And so we devise our expansion plans based on that initial principles. I didn't quite hear the second part of the question.

Business [indiscernible] geographies for M&A. What we illustrated, what Jacques illustrated to Bruno in the first part of the presentation is that the group is built in the following way. You have mature businesses, maturing growth in Rubis Energy bond, which generate free cash flow available distributable of EUR 250 million annually. It's those EUR 250 million of available free cash flow that serve to pay the dividend and we saw that on the basis of EUR 192 per unit in respect to '22 will represent about EUR 200 million. So we have the cash flow of Rubis Energy after CapEx. Organic Rubis energy of the order of EUR 120 million and development CapEx of EUR 60 million to EUR 80 million a year and a positive -- surplus positive balance in excess of EUR 200 million. So that pocket is truly there to secure the payment of a dividend to the shareholders, the Rubis shareholders is to renewables, we showed that it was self-financed because it sent by recalls to loans essentially. I don't know if that's clear. On the mechanics of securing the dividend per share through the surplus cash flow of Rubis Energy without in any way constraining the group's investment. And we even discussed together a farm down mechanism, that's an option we will have one day to free up cash within Photosol to contribute to accelerating investments, for example.

It seems to me that we've answered the last few questions. Thanks very much for your attention and the time you've devoted to us. And look forward to seeing you again in the next few months to continue following the expansion of our operations with our result to continue to accelerate the group's growth. Thank you. [Statements in English on this transcript were spoken by an interpreter present on the live call.]