SIG Group AG (SIGN) Earnings Call Transcript & Summary

Good morning, everybody. Great to have you all here in Linnich. And thanks for joining us here in Germany. And also, obviously, for spending the night with us, we're super pleased to have you here. I hope you've all set up -- your WiFi is working, and then we going to get started. So you're here in Linnich. That's where it all began for SIG Combibloc. That's the origin of our aseptic carton packaging. And we're super excited to host you today here in this new building, which is at the heart of our Linnich site, and that's the innovation hub for Europe that we just newly created. We expanded our R&D. And we use kind of a bit of a window of opportunity before this hall is going to be full with equipment. There are already some parts that are full, you're going to see that later but we felt it's appropriate place to feature our technology at the heart, where we develop it. Now SIG is a leader for sustainable packaging for liquid food and beverages. And you heard me saying that before, but we are operating in growing and resilient end markets. And those end markets are driven by population growth, disposable income growth, people that want to consume more of milk and other food and liquid beverages. And we have built over the past couple of years, decades to speak, a platform that allows us to capture this growth. To capture the growth, not only in the mature markets but also in the emerging markets. And we have innovation capabilities that we are going to be very proud to present to you today together with our technology, the core technology of our offering that allows us to capture this market growth and to remain also the substrate of choice, the supplier of choice when it comes to packaging that is sustainable going forward. And all of that allows us, and that's what we try to demonstrate today to create superior value for all stakeholders and our shareholders. So welcome to our Capital Markets Day 2023 and to our site in Linnich. We talk about forward for better and I got to spend some time in my introduction to give you a bit of context why we [ felt ] that's the appropriate headline for this event. But before we get there, all of what I just said is delivered by a team of 9,000 colleagues around the globe. And those 9,000 colleagues around the globe are led by our Executive Board, all those colleagues that you're going to hear today and that you have met over last night, and you will have a chance to interexchange and talk today. So allow me briefly to introduce them. Some of you have been with us the last night. So there's no need for further introduction, but I think some of you have just joined us this morning. We're very happy that we were able to fill the vacancy, so to speak, of the CFO position. Anna joined us on the first of November. She joined us from Henkel where she was the CFO for the largest division, the [ CIS ] division. And also the process of getting to know each other, Anna has spoken to many members of our Board during the process and the Executive Board was involved. We really learned to appreciate the business acumen, Anna you are over us in global operations at Henkel you bring a strong operational background. I think it's a great addition to the team, and we look forward to work together. And another face that you haven't seen last year at the Capital Markets Day is Gavin Steiner, who is with us since April this year. Gavin joined us from Nestle and has done many things there in operations and R&D at the last role as the global packaging R&D lead, and he takes care of all what you see in here and beyond the R&D work that is happening in SIG. Another change that we also have touched briefly on last night and colleagues with us Lidong -- Fan Lidong who ran China for us for many, many years who built up China, our presence there and then later also Asia Pacific North, which includes Taiwan and Korea. He goes into his well-deserved retirement, will be around for us as he is going to continue to work with us as a senior adviser to the business to me. But that was the trigger also to bring Asia Pacific back under on leadership, and that's going to taken care of by Angela Lu, who you have met also during last year's Capital Markets Day, and she's going to look after entire Asia. But yes, that was also for us at the moment to reconsider our structure of our segments. And that's where at the moment where we carved out India from Asia grouped it together into IMEA India, Middle East and Africa and the leadership of Abdelghany, who you have met many times before. Now there was also a logic to do that because when we speak to our Indian customers, naturally, they like to go to Dubai. There is a big Indian diaspora, many of our customers organized in the same way when we do trials for new product recipes, Dubai is just closer to them. And this proximity we wanted to use. This proximity guides us in everything we do because we work in partnership with our customers to bring liquid food and beverages to consumers around the world in a safe, in an affordable and in a sustainable way. And the sustainability demand I mentioned is more in demand than ever before. We all are aware of those challenges here. We know that we need to feed a growing population. We need to reduce carbon, and we also have to avoid and reduce plastic waste and we must protect the biodiversity. And while many look at that for the right reason, as the problem statement, for us at SIG, it also is our opportunity statement because we define the sustainability performance of the packaging substrate along 3 dimensions. That's the recycling, that's the carbon footprint, and that's the renewable content. And recycling includes that you design for recycling but also have effective recycling rates, recycle at scale that you use recycled content. You're going to hear about all of that. The carbon footprint requires that we lower the carbon footprint along our value chain and one of our products, the beverage carton is the best performing substrate. And you're going to hear what we do to bring that further down and the renewable content is the link back to the biodiversity where already today, 70% to 80% of our product is from the forest, our main asset for sustainability and for biodiversity. Now to feed the world, to feed the growing population. We see a unique opportunity for our core technology there. And our core technology that helps to distribute, to preserve and distribute food is aseptic. Now aseptic is a very technical term. What does it actually stand for? Aseptic is a process to preserve food products -- to protect nutrients and vitamins without the need to add preservatives. But yet the product is going to be ready for ambient distribution in a shelf stable for up to 12 months. Today, you have the chance to see that because we run our own UHT processing unit here in our core development center, where we have customers that come for product trials and scale-ups to our plant. And you're going to see how such a UHT looks like, and you can discuss with the expert what that treatment includes. Now there are alternatives for aseptic such as hot fill or retort that allow you for ambient distribution. But the downside with that is that hot fill needs a lot of sugar to preserve the food product. Retort is autoclave-based process that cooks the food product for sterilization. And you lose a lot of nutrients in vitamins. So in short, what aseptic stands for is low sugar, high nutrients, high vitamins. And that's what consumers want. And this is our opportunity to help our customers to bring food products to the consumers around the world. Now I saw a number of colleagues that joined us from Switzerland today. And in Switzerland, we were able to read this year that we lost in the last 2 years, 10% of our glaciers in the Alps. So climate change is real. I think people understand it. People know that we need to act upon it. And we have the lowest carbon solutions, and they are in demand because all our customers, especially the big multinational ones have significant pledges out there, how they want to decarbonize their value chain and how they want to transition into a zero emission economy. And that's where our solutions can help and you're going to hear that from all my colleagues during the day, and you're also going to hear how we improve the footprint going forward. Now many things that sustainability is a topic that is mainly discussed in Europe -- mainly discussed with our European customers. But that's not what we experienced. We experienced that sustainability is very high on the agenda also across emerging markets. And I think there's a reason for that because the marine litter issue is not necessarily in Europe, maybe a bit on the shores of Alaska in the mature market of North America, but it's a very visible challenge in Southeast Asia. The pollution through emission and the resulting smoke, there is an issue in the Chinese cities and the people, the waters, the consumers of this places expect their leaders to solve these challenges. And we need to reduce plastic and all our solutions from spouted pouch to carton to bag-in-box have lowest plastic intensity. And that is going to be our contribution here. And to conclude on the fourth dimension, it's about biodiversity. We believe that biodiversity is going to gain relevance in the eyes of our customers that have to take a decision on a packaging substrate in the next 2 to 3 years. It's not because suddenly, it became more important. It always has been. But you know what happened on the carbon side with the SBTi Science Based Target initiatives, where we started to measure carbon. All of us are today proficient to read carbon footprint reports. We all report on that as businesses and we believe that the same is going to happen also on the nature on the biodiversity side. We joined the group, and you're going to hear it from our experts later where we define how to measure the nature footprint and as the saying goes, what gets measured, gets done. People are going to formulate targets, but they need to have solutions, how they reuse their nature footprint, and that's where our solutions come into play. So there's a huge opportunity for us collectively to create value, gradual for the planet for the consumers, for our customers, but also for our shareholders. And this is where we have an opportunity with our strong market positioning. We are the #2 and #1 in those different segments with a global footprint. It allows us to really make a difference because we have an impact we can scale it. And this is what we bring together under the headline forward for better. For better, for the customers, for the consumers, the planets and for our shareholders. And that gets us to the value creation. SIG has a distinctive model for superior value creation. And we look at that along 4 pillars. We talk about the end markets and the resilience. We talk about the established platform, our industry-leading innovation, and that's resulting in best-in-class financials. And allow me to take you through that, and you're going to see that underpinned then over the course of the day with many more examples, how we deliver on that. Now our end markets grow globally in aseptic carton with 3% to 4%. That's driven by population growth, disposable income growth, growing middle classes. It's an increase of per capita consumption. You're going to hear from my regional colleagues. In Europe, we drink about 50 million -- 50 million liter. We would love to 50 liters of liquid milk per capita in parts of Asia, significantly lower, around 10. Obviously, Middle East, Africa, even lower. And even if you don't believe that those parts of the world can get to the 50-liter in Europe, the mature markets in Asia drink 25 liter. And we believe there is such a demand for protein where dairy is a big provider for it. If you think about India, the largest dairy market in the world, there's a conversion ongoing from loose milk to process and package milk. That explains the growth rates in the teams. And that is what defines our opportunity in the market. And as we operate in this entry level of process and packaged food, that explains also the resilience of our end market. And I think that has been proven multiple times since the IPO in 2018 in all these macro challenges that we had to stand. Now at the same time, we do see there are specific trends, those trends like safety, food safety, the health awareness of consumers. And if you think back to what we discussed around the aseptic technology, that's what we cater to. We're super excited as we did grow our business over the past couple of years along geographies, along categories that have added now last year with acquisition of Scholle IPN, bag-in-box and spouted pouch, the dimension of food service to our growth vectors. And bag-in-box is going to allow us to participate into the growth of the food service market, which is driven by the same underlying fundamentals but is outgrowing retail, basically in all markets where we operate. And that is a super exciting opportunity and will help us also to accelerate growth going forward. Now I talked about this established platform. But what do we mean by established platform? We mean our offering and at the core of our offering is our technology. The system business consisting of the machine of consumable and of the technical aftersales service. This is the system. This is our Razor-Razorblade business offering. And we have a number of unique selling propositions. You can characterize and summarize them on the flexibility when it comes to volume formats, billing capabilities. And over the course of today, we want to demonstrate how we create value with those USPs for our customers and why that allows us also to charge and price for the value we create for our customers. I want to talk a bit more now at this point before moving on about our geographic platform. And you see here on this chart on the upper left corner that by now, we are truly a global business with exposure into end markets in Asia, in Americas and in Middle East and Africa. When I joined SIG back in 2005, I remember, we did about 75% of our revenues in Europe. Now that looks completely different. And last year, for the first time, Asia has been our largest segment and that is the exciting thing. That's the emerging markets platform that we built because it exposes us to the faster-growing market. I said before, our aseptic carton end markets are expected to grow with 3% to 4%. And Asia growth is 5% to 6%. You might remember the 6% to 7%, if you carve out India, gets you to 5% to 6%. So the same applies also as a growth rate, 5% to 6% for IMEA. Americas with around 3% to 4%, Europe rather flattish. So you see our footprint helps us also to capture the growth there. And when we talk about our emerging markets footprint, we talk about the fact that we have our manufacturing capabilities in there. We talk about the fact that we have the customer relationships and the relationships with the right customers, the ones that know how to operate the aseptic equipment and you're going to see that later on aseptic equipment has an entry hurdle, not only from a capital perspective, but also from an accessibility to high-quality ingredients from a kind of a capability perspective also to run the supporting operations for aseptic assets. So we own the customer relationship with the right ones. We have field service engineers in field. They cannot only service the aseptic carton lines, but also the newly added substrates. And this is our emerging markets platform where we want to bring now bag-in-box and start of spouted pouch help our customers there to expand into food service respectively, into the high -- higher risk cost products for spouted pouch on the retail side. But also part of our established platform is the business model. And we discussed that in many instances before. But just to remind you the highlights of that is this is this Razor-Razorblade concept that we also reflect in the way how we structure our commercial deals. You're familiar with the fact that when we place a filling machine that we co-invest on average, 2/3 from us, 1/3 from the customer, and we look at that as an investment case. So we want to have our money back dynamically computed with 2 to 3 years. So all the cash outflow, which is mainly the co-investment is considered in the cash inflow, which is the contribution from the sale of consumables. Customers enter with us into supply agreement when we place the line for 6 to 7 years where we sell packaging material, and we also enter into a service agreement to maintain the equipment. And when I -- when we IPO-ed back in 2018, I did the computation to look at when we lease a filler in how many cases people entered into a second lease term. There was 95%. So initial lease term is 6 to 7 years is going to be prolonged by another 6 to 7 years. So the equipment is there normally far above 10 years and even more. I remember one plant in France that was initially Campus Europe that operates our food filler with over 20 years because they still serve the purpose, allowed the customer to fill the products that they need. And this is the system business that we enjoy. And with the newly acquired businesses, we have similar lock-in, we have similar system offering. There's equipment, there is consumable and there is service, and that's why we like that. And that leads to this strong ties with our customers. That's why not only for the legacy aseptic carton business, we have the top 10 customers relationship of over 30 years. The same applies interestingly also to Scholle IPN. And this is our Razor-Razorblade business model. Now I said before, the established platform is enhanced by our innovation capability. Gavin is going to talk about our 4 core capabilities. Those 4 core capabilities to go across the 3 substrates that we offer, 4 if you at the chilled carton to it. And we have a number of industry firsts. We were the first ones that obviously offered the fleet-based system in aseptic, have all these USPs. We were the first ones that brought an opening device and then a screw-cap. We were the first ones that came with the alu-free solution. And these capabilities that we have here, they're going to allow us to continue to leapfrog our industry. That's our ambition. We want to continue to set industry standards for bag-in-box, spouted pouch, and carton, especially aseptic carton. And all of that leads to the superior value creation. We continue to aim to outgrow our markets. We aim to grow with 4% to 6%, and we said through bringing bag-in-box spouted pouch to the emerging markets platform that will allow us to accelerate growth over time. So in the upper half of the 4% to 6% and we have an ambition to bring our margin after the dilution from M&A back to above 27%. That's not going to happen only because we bring the newly acquired substrates to the group level. We had, as many of you probably recall, a commitment out there for the aseptic carton to continue to improve our EBITDA margin. And that's going to happen. So all substrates need to continue to improve margins. And there are many levers that are going to get us there as you're going to hear later on. I think it's a combination of top line levers where we have through innovation, through value-based pricing, through more emerging markets throw us an opportunity to deliver growth that is also margin enhancing. And we have committed to a number of synergies, the EUR 23 million for both acquisitions which are well underway and track with our expectations. They're going to help us to get there. But there's also operating leverage. And there's opportunities as you're going to hear from Ian later on to drive efficiency across our global product manufacturing network. So that's going to help us to achieve our targets also on the margin side. And you're going to continue to see us talking about the return on capital employed, the returns that we deliver, not only because of the co-investment model of the fillers, any capital project obviously needs to go through a rigorous prioritization where we look at our returns. And I would say that that's probably a part of our PE legacy where we were all trimmed on this return. You remember before acquisitions, we showed a return on capital employed of above 30% post tax, and there's clearly with the improvement of the margin and opportunity to also continue to increase that. This is what we call our best-in-class financials. This picture brings it all together. It's a very busy one. It tries to capture what we want to show you today how we think about our own business and what in a very abstract way explains our excitement for the business. And I hope that's kind of the takeaway also then for all of you after having come with us through the entire day. And we have put an amazing agenda together for you today. You're going to see all of our Executive Board members, you're going to see, as you had already last night, the opportunity to speak to export levels. We want you, and that was the feedback we received from last year's CMD, where people told me that they really appreciate to have access to the team. And so we built that in by design. So we give you access to experts, to other corporate colleagues, whether that's finance, whether that's corporate social responsibility because I mean you have heard me talking today and prior to today. Today is the opportunity to hear it from all my colleagues that deliver on it. In the first instance, you're going to remain a bit in this setting. You hear my colleagues from a global view in the Executive Board, then we're going to take you through Linnich site and through various parts of our operations in order then to come back here into this room and hear from our colleagues in the regions, how they deliver value to the customers. The regions are the point of impact. That's where we prove our competencies. That's what we're going to do today. So please stay tuned. Christophe join me on stage. You're going to take us through the top line and explain how we're going to outgrow the market also going forward. Thank you very much, everybody.

Thanks, Samuel, and good morning also from my side and a warm welcome. It's really a pleasure to be here with you. So you heard Samuel talking about that SIG operates in attractive end markets. I will share more details as to why we say these markets are attractive, but more importantly, how SIG intends to capture growth in those markets. Let's start with the market itself. So there are 3 fundamental drivers that we see is driving food and beverage demand. Number one, population growth. Every year, 80 million people are added to this planet. And naturally, they need to be fed. At the same time, we have economic growth, which leads to rising disposable income, a global middle-class emerging. Now they're not only consuming more per capita, but because they're mostly urbanized, they also demand for packaged food. And that brings me to the third trend. As consumers are more educated and economies are more developed, we see a lot of investments into food processing to deliver safe food to the population. So those are the fundamental drivers. But there are also consumer trends that shape growth of the food and beverage market. There are 4 key trends that I want to share with you. Number one, increasing demand for healthy nutrition. So products with claims like low sugar, high in vitamins, high in protein, plant-based are really outgrowing the market. And that creates opportunities in categories like nutritional drinks, drinking yogurts as well as plant-based products. The second trend is affordability, and it's always been there, but I would say it's been even amplified in the last year with the spike in consumer price inflation that we have seen. But that creates a lot of growth opportunity in smaller pack sizes and entry-level products. The third trend and it's here to stay as sustainability. Despite consumer price inflation despite some of the economic challenges that we are facing, sustainability is a mega trend. Consumers simply demand products that are sustainably produced and also sustainably packaged. And we also see in market data that brands with strong sustainability claims are outgrowing products that do not have these claims. The last trend is convenience and convenience is all about the out-of-home occasion, out-of-home consumption. So this is either on the go or in restaurants, and that creates a lot of growth opportunity in food service. Let me share with you how this all turns into numbers. So the fundamental growth drivers of population growth, increasing disposable income and demand for safe food is -- are the drivers that get us to a structural growth rate of 2% to 3% in food and beverage. Now it's the consumer trends that amplify that growth rate and yield a higher growth rate in the substrates channels and categories that we are present in. We take aseptic carton, a perfect package for dairy products, which are both healthy and nutritional but also affordable. And that's why we say on a global level, aseptic carton is growing at 3%. But in emerging markets, it's growing at 6% and above. We look at bag-in-the-box, a perfect substrate for foodservice, which caters to the convenience strength. We see that growing globally at 4%. But in foodservice, in the foodservice channel, in particular, growth is 6% and above. Last but not least, spouted pouch. So those are typically products that are consumed on the go. So again, it's about convenience. Those are products that are typically also nutritional. So it caters to the health trend. We see that growing at 8% to 10%, albeit coming from a lower base. Now we aim to outgrow this market even though the categories that we're in already outgrow the wider food and beverage market by factor 2 to 3, but why do we believe we can outgrow it? And how are we going to do that? Simply speaking, we have the right product portfolio that caters to the market trends that I've mentioned. So if we take Health and Nutrition. Now we have unique shapes -- unique packaging shapes that we offer to customers that help value-added products stand out on the shelf. When it comes to -- when it's about value addition, it's about premium pricing, it's about standing out on the shelf. Our unique filling capabilities, for example, the particulate filling. So the ability to fill inclusions into products helps our customers to increase the nutritional value of their products. And the tech centers that we have built around the globe facilitate co-development of new nutritional recipes with our customers. So our product offering really caters to this trend and allows our customers to capture the growth of that trend. Talked about affordability and specifically about the growth of small package sizes and that's really where our unmatched size flexibility comes into play. So on this platform, our extra slim, 80 milliliter, but you cannot only fill 80 milliliter, you can fill pack sizes up to 200 milliliter. So you can really play on with 9 different volume sizes, you can produce a very complex SKU portfolio without the additional need for CapEx, fast changeovers and production, no disruption. So that is really key to address this trend of smaller sizes of [ shrinkflation ]. This is combined with industry-leading total cost of ownership, which is built on high output, and we have some of the fastest output platforms in the market and industry-leading low waste rates. And we keep our machines running through our technical service and the digital service solutions. And that allows our customers to reach the productivity levels needed to play in these very low price points, these magic price points that we have at the entry product level. I also talked about sustainability. And here, our leading product portfolio. Our SIG [ tariff ] portfolio comes into play, the leading or the lowest CO2 footprint in the categories we operate in, and the lowest plastic intensity. So that's a very powerful proposition. But what is very important, all our sustainable structures run on the installed base. So there's no CapEx required to overhaul the installed base. And that is a very powerful and true differentiator to competition. And last but not least, I mentioned convenience and the growth opportunity in food service, and this is where really bag-in-the-box comes into play. Best product to pack ratio highest quality that we deliver and our ability to develop bespoke connection systems that fit into the dispensing systems required in food service. That really makes us stand out and makes us win. So that's the product portfolio and the product offering, but how do we deploy that? We focus on multiple sources of growth with a multifaceted growth strategy. Number one, growth in the core. So that's market share gain in the categories that we are present in and that we are strong and in -- the geographies that we are strong in. So liquid dairy, food as well as post-mix syrup. But we build on that, and we focus on market segments that show above-market growth, as I have shown. So geographic expansion, we're investing into India, the fastest-growing food and beverage market. We are expanding in Latin America to surrounding countries around Brazil. We are tapping into new or underpenetrated markets in the Middle East, Africa. On top, we are focusing on growth in new and emerging categories. I mentioned plant-based drinking yogurts, nutritional drinks. And last but not least, food service offers a very attractive growth opportunity as more and more liquids that are pumped or filled in food service and quick service restaurants are served in BiB. And that makes us believe we can deliver a long-term growth rate of 4% to 6%, leveraging our portfolio that is not only catering to the trends, but also because of its sustainability performance future-proof. So how do we execute our growth strategy? With a very well-established commercial platform that is based on solid fundamentals. So our top customers have been with us for more than 30 years with very strong customer loyalty, but also our system offering, which we have in each substrate. So bag-in-the-box, spouted pouch as well as carton, we offer a full system that is deeply embedded into the supply chains of our customers. And that creates a stickiness in the base. Now we build on that to grow. And for that, we leverage what we call the SIG commercial engine. That is our commercial excellence approach, focused on very rigorous deal pipeline management, solution selling and value-based pricing. Our growth is also more and more accelerated by cross substrate synergy opportunities. So where we sell to a customer that has today aseptic carton and bag-in-the-box pillar to expand into food service or a customer that is induced carton spouted pouch to address the on the go occasion with more viscous products. So in summary, attractive end markets, and we have the right product portfolio to capture the growth opportunities. We have a clear strategy tapping into end market segments that show above-market growth, and we execute that on a very well-established commercial platform. Now my regional colleagues will later in the afternoon share very concrete examples of how that looks like in the market. But before we get there, I would like to hand over to Ian, who will talk about our operations strategy and how it enables our top line growth. Thank you.

So good morning, everyone. Now that I hope you're all excited about all the growth opportunities that we have ahead of us. I want to give you the confidence that we have the supply chain capability and the production network to deliver on all of those growth opportunities as well as the operations playbook to meet our margin expansion ambitions. So let's have a look at the production network. We have 35 production plants around the world, including 2 under construction, and that includes a unique capability to produce aseptic carbon sleeves. It includes an integrated capability for bag-in-box and spouted pouch with everything from film blowing, injection molding, bag making, pouch making. And finally, ability to produce and assemble filling machines that form the heart of our system offering. And many of these plants are in low-cost countries and well positioned to serve the high-growth markets in Asia, India, Middle East, Africa and Latin America. And with this network, management of what gets made where, management of the network becomes increasingly important to make sure that we can deliver to our customers with the lowest cost to serve and the minimal CapEx spend necessary. Our production strategy is to produce local to where the demand is, assuming we can meet a minimum efficient scale because I don't want a proliferation of subscale plants and also to favor production in low-cost countries where that makes sense. And as we add capacity in Mexico, in India and in Asia, you can expect to see our share of low-cost country production increasing. Now having said that, North America is also a growth market for us, as our bag-in-box offering, gains volume, gain share in -- particularly in quick service restaurants. And here, we are also investing to add capacity in our most competitive plants. But it's not only about investing in new plants and new capacity. We also rationalize the production base where that makes sense, and we're currently in the process of closing our Canadian plant. That will be complete by the end of this year. So let's take a closer look and our CapEx investment priorities for this network. Besides investing for growth and to give us those opportunities for network rationalization. We also invest in automation and innovation. Now producing around 50 billion packs a year, automated material handling is a key driver of cost productivity. We're already quite advanced in this area, as you will see later in the tour, but there's definitely further road for improvements in productivity through automation. Equally, we use automation to improve quality, and we are operating many proprietary inspection systems in our plants, and you will also see examples of those later. After automation, we invest for innovation that might be new tooling for our new product introductions such as Mini Dome (sic) [ DomeMini ], combivita, and it can also be innovative new production technology such as our investment in digital printing, which will offer -- which will enable us to offer unprecedented flexibility to our customers, and you will see that press running later today on the tour of production here. Now we're coming through a period of significant CapEx investments in our production network, and that is giving us a great pipeline of projects that will deliver benefits for the quarters and years to come. I'd like to just mention a couple of them on this page. Firstly, the investment in our Chilhowie plant in North America, that is primarily a bag-in-box plant, our most competitive bagging box plants in North America. That is what's enabling us to rationalize that plant in Canada, but also giving us capacity for growth in the quick service restaurant market. And the second one, I'd like to mention is the new chilled plant in Suzhou, China that we are constructing. This plant, I am confident will be one of the most, if not the most advanced, productive chilled carton plants in the world as we bring our decades of experience producing aseptic cartons to bear in the chilled carton market. But we don't only need CapEx and investment to improve both our performance and to increase capacity. We have a tried and trusted operations playbook that also can achieve performance improvement and capacity expansion. So let's have a look at that. All of our plants around the world are managed to the same safety, quality delivery and cost KPI framework regardless of substrates. And that's supported by a structured lean program, which we call SIG Excellence System, which defines how I expect all of our plants to be managed. That includes best practice sharing, training and audits from our lean experts and all of that leading to an improvement road map that every plant is expected to produce and then execute. That program has been well established in our aseptic carton plants for many years, and we are now progressively applying it to our bag-in-box and spouted pouch and chilled carton plants. Centralized procurement is another key element of our operations playbook. We're very strong at bundling our global spend on our key raw material commodities and in-store doing achieving best value in those supply markets. And that's what enabled us to very quickly bring in the polymer spend of bag-in-box and spouted pouch plants into our global polymer tenders. Now all of this will support our ambitions to continuously reduce our cost to serve our conversion cost, ensure that we are operating our plants with top quartile safety performance within the packaging industry, enable us to continue improving the quality that we deliver to our customers and end consumers year-on-year and ensure that we achieve highest customer satisfaction, which we measure through our Net Promoter Score surveys every year and where we have a very nice positive rating. But we're not only in the business of improving our own plants. We also have a large field service engineering team, which is active every day to help our customers improve their plans. That team takes care of the performance of our filling machines and also the entire line from filling machine to downstream and palletizing in our customers' plants. And it's supported by a digital service infrastructure at the heart of which is our filling machine, and it's a connected filling machine. Majority of our filling machines are connected, meaning that we can get data from those machines on the performance of the machine in terms of OEE, waste rate, number of packs produced every day, but also the health of that machine by looking at temperatures, pressures, electrical currents and so on. And with all of this data, we have built a digital platform that uses both the real intelligence of all the experience we have in our engineering team, coupled with application of artificial intelligence to continuously optimize maintenance programs on our machine and help our customers achieve higher technical availability, higher quality output and improved food safety. Now I mentioned that one of the things that we invest our CapEx in is to support an introduction of our innovations. So now I would like to hand over to my colleague, Gavin, who will talk more about our innovation pipeline.

Thank you, Ian. Thank you very much. Here we are. So good morning, ladies and gentlemen. So the building blocks to deliver what you've seen there is part of my job today to share with you. So I'm Gavin Steiner. I joined SIG this year coming with 28 years of experience in the FMCG world. in operations and in R&D. And in the last 5 years, I was leading the R&D strategy for packaging in Nestle. So very proud to be here with you today and to share a little bit about the area of technology. So as the CTO, the Chief Technology Officer, looking after the R&D world of SIG. So can you imagine what is the vision of the R&D team? Striving or better through leveraging our innovation and to deliver points of differentiation that you've already seen some of as the building blocks, but what we're going to do going forward. So this pack here, do you have any idea how unique it is, this one and the other beverage cartons? All of you, I presume, cook at home. You make your meals, you put them into a Tupperware or into a container and you put in the fridge and you expect it to last a couple of days. This pack takes the same quality nutritious product, puts it under aseptic conditions into the pack, and it lasts for how long? Up to 12 months. As good and as nutritious as the cook food you cook at home. How do you achieve that in ambient conditions on shelf is truly unique, okay? So on this journey, I think you understand that pack or this pack, the beverage carton packs have a knowledge behind them, which is pretty impressive. So let me take you on the journey of how R&D brings this to life. We focus on continuous improvement, which you saw in the operations world what Ian shared, showing how machines are evolving, becoming more and more efficient. We look at step change development. Those step-change developments is exactly what differentiates us to competition and brings the new news to the table and really makes things change all with value creation in mind and value creation not only for the customer and the consumer, but also ultimately for the environment. So in R&D, we have the 3 Ds. Discover, develop, deploy. The discovery part, ladies and gentlemen, is the building blocks. It's the holy grails, finding the new breakthroughs, which then once those are discovered, which is science, and that's why we get up in the morning because that's the things we enjoy solving. Then we move into the development of those ideas. and then ultimately, the deployment of them into the markets to meet the customers' expectations and also the consumer. So those are the steps. And the continuous improvement is the efficiency performance, energy and then the differentiation, again, is where we really truly make a step change and stay ahead of competition and then the value creation. So as Samuel mentioned in his intro, we have many first mover principles or many first-mover solutions on these building blocks, which is really the reason that I enjoy working in this R&D team so much because they are at the front of knowledge. Coming back to this pack to make something last 12 months under ambient conditions is a knowledge which is not readily available elsewhere. So I hope you follow that journey a little bit. It's something that gets me up in the morning. So let's go on to what are the key points to how we use that ecosystem across R&D. This is probably maybe the first time you see the R&D, the research and development centers across the world, of which we have 5 with potential extra gray box that you see. But starting geographically distributed, not only from a location serving [ enough ] the invested base that we have, but also technology and material science that is synergy between the centers. So you have those centers sharing that knowledge, but some of them really have expertise, which is unique and that knowledge, we then cross-fertilize. So from the U.S. right through to China. That's our distribution of R&D, of which we have around 300-plus engineers and scientists. So a really good investment base of knowledge. We are not only using those expertise. We also have the expensive ecosystem, which is universities, startups, our key suppliers and all of that work happens within the R&D team as well as the SIG world, where we're leveraging that knowledge to once again come to those breakthrough discoveries, the development and then the deployment. So coming back to the 4 key areas that we look into with our expertise across that network that you've just seen, the aseptic exponential knowledge coming back to that wonderful pack, the filling technologies, which is the machine and the knowledge of how we set this up, the packaging with the consumer-centric focus, so both delivering for customer and consumer and then the material science, which is truly differentiating. So looking at those ones, you see how they fit into our 4 key industrial leading innovation areas. And I really have the pleasure today with my colleagues of sharing some of the facilities that we have here with the research from the building blocks right through the ecosystem or the value chain of operations to the final product. So you're going to see some of this in more detail. I don't have all the time to go through each one, but we're going to have a bit more time on this stand over there. Let me go back one, sorry. So a question, how many of you have a financial background in this audience? And then how many of you would like to see a tenfold improvement in the safety of your portfolio or the surety of your portfolio? Tenfold improvement. It will be pretty impressive. So this is where I really do get inspired by the SIG team. So when we talk the aseptic performance of our packs, we have a logarithmic improvement in the sterility of the environment through the aseptic process. So looking there at today's winning standard, this is what we deliver. One in 10,000 packs having a potential issue, one in 10,000. We have invented the tomorrow today, the middle one there, creating the benchmark today, we now with our new machines are able to do one in 50,000 packs, which is really stability. It shows the level of quality. But ladies and gentlemen, in there, you have to understand the knowledge to do that and to control it in an ecosystem of machine filling and recipe is really differentiating. Logarithmic one in 100,000 performance and ultimately striving always for zero in the world of safety, zero accident is what you want. In the world of quality, zero in sterilities or zero product complaints is what we want. And a pack like this, it's not only designed on the machine to be well controlled and under good quality. But there are the parameters here, which you would probably understand, is this pack, you know if you drop it, it should survive? Should I drop it? it's not the one in 50,000 that survived. All right. So we also engineer with all of the knowledge of polymer science, how the packs stay together, how they resist all of the different attributes in the value chain and the supply chain. So really something significant and impressive. So there, you see it. [ Just back ], if you could improve your portfolio like that I think you'd continue to invest. So I think in aseptic technology, we differentiate very well. Machine science quickly, we have our aseptic platform and we have our new businesses that we're integrating. On these new businesses, we have not only the co-sharing of the aseptic technology coming into the bag-in-box and spouted pouch world, but we also have the learnings in the bag-in-box and spouted [ world ] on polymer science and materials coming back into the beverage carton. So here you see a very nice ecosystem of the synergies that we leverage from the new acquisitions and how we collaborate. And this is also the efficiency performance of machine. Remember, we both material and machine and we're after the system. So in that area of improvements or breakthrough ideas that were hidden in the bag-in-box world, we see that coming back into the SIG beverage carton [ world ] and that's also a great opportunity to leverage that ecosystem across the world or the geographical distribution of R&D. We bring it all back together. So the other one we never forget about the customer and the consumer. And this is where we do consumer-centric innovation and development work, looking at the right format, the right consumption occasion,s, the behavior, legislation. You know all the stories and you've heard about tethered caps. We've designed the legislation in, but we also have the consumer and customer in mind. So we design it with something that's practical and usable, and that's the environment hub looking at the packaging development with consumer centricity. Okay. Now the one which we're also going to bring to light a lot today is around our material science, the fourth one on the list of the material science, the structure of the material. My team are going to be able to bring to life exactly what we mean when we talk about paper content in the pack. You might just think if you wrap something in paper, its shelf life is not guaranteed. So we're going to help take you on the journey of the different reasons why this works so well. Material selection, the barrier functions, if you take out aluminum, which is a very good light barrier, oxygen barrier and moisture barrier. If you remove that from a pack, how do you still keep all of those parameters in the pack? So we'll bring that to life to you in the tour of the booth. Sustainability at the heart as we improve this, we make it more and more sustainable. And one message I'd like to share with you is I know we get criticized in the industry quite a lot about coming up with a new breakthrough solution and every solution can be criticized from different angles on packaging sustainability. But what is very important is my principle is every step in the right direction is one worth taking. We need to support that there is an evolution of knowledge, building blocks. And as we move forward, you unlock customer and consumer behaviors, you unlock recycling facilities. You unlock the world that today is pretty much needing some of these keys. And here, we're going to show you how we're taking on the journey with a commitment of 85% fiber content by 2025. Today, the pack is about 75%. We're taking up to 85%. The how is important, and then we're going to go to 90% by 2030. All right. So on that note, I hope you managed to follow the journey. We're going to really help you see a bit more of the technical details as we go on the tour and I'll join you again later. So I'm going to hand over to Samuel to introduce our next guest speaker.

Thank you very much, Gavin. I indeed have the privilege now to introduce our guest speaker today. We have a number of customer testimonials, you remember in the Capital Markets Day, we were once at the customer site. We had customers flying in from all over the world to talk about how they run our equipment. You're going to see later today a number of customer testimonials. But we are very pleased that today we have a guest speaker that looks at SIG and our industry through a different lens. So we have a guest speaker with us today, who is the leader of an organization. We had the privilege to just enter into a strategic partnership, and that is WWF Switzerland. And this is Thomas Vellacott, it's CEO. And he also has committed to work with SIG on our responsibility advisory group. That's an expert panel that helps us, management to continue to set our sustainability strategy. And for us, sustainability, as I hope it came across to you is integral part of our strategy. It's all about also to create sustainability that is lasting. And it's only lasting -- can only have an impact if it's also economically sustainability. It creates value. And that's what we use as a forum, this responsibility advisory group to continue to shape this strategy. So please round of applause for our guest speaker today, Thomas Vellacott, who is going to share with us his perspective. Thank you, Thomas.

Thank you, Samuel. Thanks for having me. It's not every day that I get to address investors. We deal more with donors on our side. But it's a great pleasure to be here today and to be talking to you about the partnership, the strategic partnership we've entered into with SIG. Now if you scroll through your news feed the last couple of months, you will have come across pictures of extreme weather events, whether that's floods in East Asia, whether that's storms in the Mediterranean or whether that's wildfires such as this one in North America. And I come across more and more people telling me I used to think that climate change was something that might be coming in the future. I now realize it's here now, and it scares me. And the question that poses to all of us is how do we respond? And this is a real picture by the way. We can maybe take that and see how people respond here. Well, some of us will continue playing golf and try and sort of push the problem aside, try and pretend it's not there. Eventually, the air gets a bit acid and it gets a bit harder to play. Others like that couple there in the background might be standing there saying, that's really bad. Someone should really be doing something about this. And of course, what we try to do is encourage people but also companies to not just watch, but to take action. And we partner with companies in order to do that together. Now the good news is over the last 10-years, sustainability and particularly climate change and biodiversity loss have become major issues for companies -- the world over. What you see here is an excerpt of the global risk report that the World Economic Forum publish this every year. Where they ask their customers, what are the biggest, the most impactful risks your businesses face? And you don't have to be able to read all the details, but just look at the colors, 6 of the 10 largest risks are environmental risks. Now if you go back 10-years, not a single environmental risk was on list. So that has really risen up. There's a much larger awareness today among companies that the environment poses significant risks that need to be addressed. Now, of course, awareness isn't enough. You then have to translate that. Well, what does that mean? What do you do? And unfortunately, that's where a lot of companies fall down, and that's why we get headlines such as these, about greenwashing, where companies say things and promise things which they can then not deliver, which is then seen by the regulator as misleading customers and misleading investors. So the huge challenge today isn't really making people and making companies aware of environmental risks, but it's helping -- it's working together to develop credible sustainability strategies and I'd like to take you through what we consider to be 4 key building blocks of a sustainability strategy that has credibility and that we are working on each of these with SIG. Now the first one is go beyond nice words. A couple of years ago, it was enough to just say some fluffy language about what you were going to do for the planet and have a few nice pictures of hands holding the planet or a plant or something like that. Those days are over. Today, you need science-based targets. And we've seen the science-based targets in the climate arena. On the right, you see the number of commitments worldwide really go through the roof in the last 2-years. It's becoming a de facto standard. If you want to have a credible sustainability strategy, you need science-based targets. And you don't just need a 2050 target, but you need regular interim targets and annual reporting against those targets to show that you're really doing something and not kicking the can down the road. So that's number one, what needs to be done. Number 2 is to move beyond carbon. So carbon and climate are super important but unless you look at biodiversity at the same time, you do not have a climate strategy because carbon gets admitted, carbon gets absorbed by natural ecosystems. So you need that second part in your strategy or it's simply not credible. It's like wanting to analyze a company by looking at just half of their balance sheet. Doesn't work very well. So biodiversity is a key part of any sustainability strategy that has credibility. And you heard Samuel talked earlier about SIG being very much on top of working towards biodiversity targets as well. Now what does that mean a bit more concretely? It means working towards nature positive. That is a term which came out of an agreement last year, the Kunming-Montreal Agreement which set targets that by 2030, the world community wanted to turn those curves, that loss of biodiversity and move into positive territory again. That is a very ambitious timeline we're talking about here, but it's not undoable. And that is the global framework that now needs to be translated again through science-based targets into targets for individual companies. And I think more and more companies are waking up to just how important biodiversity is for their business whether it's the pharmaceutical industry where 70% of cancer drugs have a natural origin, whether it's the food industry, where almost 3 quarters of the main commodities that are used in agriculture rely on insect pollination. Biodiversity is the basis on which we build our societies and therefore, also our businesses. And that increasingly also starts to be recognized in the financial community, here a quote from the CEO of Schroders "Nature and biodiversity are in the spotlight like never before. We have to mobilize billions -- we may be mobilizing billions today, but that has to become trillions and fast. That's non-negotiable for a world looking to chart a course towards a nature positive future". So mobilizing those billions, making investments into biodiversity is going to be a key part of any credible sustainability strategy. And that links to the third element of such a strategy, which is to go beyond the supply chain. So it's really important that companies work with their suppliers, make sure they take them along on this journey. We heard several examples earlier of SIG doing that. But then there's a step beyond that, where you say, okay, what about the landscapes from which we source material? Where do the different supply chains come together in those landscapes? How do we integrate the needs of the local population there for food, for clean water and how do we bring that together and build more resilient landscapes? And that's where we have a very important part of our partnership with SIG where we work in landscape, starting with the landscape, the Central Pacific Jaguar landscape in Mexico, really investing in the resilience -- long-term resilience of this landscape. And just to give you a bit of an idea of what this looks like, this isn't a national park. This is a landscape that has protected areas, but also that has production in there, that has local population in there. So this isn't about putting a fence around it and saying this is now protected. This is about working with local communities. This is about ensuring the sustainability of supply chains. And so we set ourselves together, the objective in this project, working over 5-years to restore and reforest 750 hectares of degraded lands, this is not just about planting trees, right? There are so many bogus tree planting schemes out there, where all they do is plant trees even if they're non-native, many of them die. It's not sustainable. This is really about identifying where our key corridors and putting in place natural ecosystems that can thrive long term. But it's not just about that reforestation. It's about working in an area of 100,000 hectares and improving production practices in those -- management practices in those 100,000 hectares to really ensure that this landscape comes together. And to do it in a way where we work with the local population. You cannot do good nature conservation unless you work with local communities. So it's bringing that all together. And we're very, very pleased to be working on this with a company such as SIG in such an important habitat as here in Mexico and others will be joined later on. So that's the third element going beyond the supply chain. The final element of a credible sustainability strategy for us is going beyond business as usual. And I've just put in a few examples here of what's been happening in solar and wind, in annual electric vehicle sales and in battery storage sales. And you see how this goes through the roof. You see how rapid this transition is that is happening here. And it's only been in the last 10-years really. And we're seeing this in sector after sector after sector, this massive transformation towards sustainability. And this is the fastest transition we've seen, really since the industrial revolution. So I think that's the kind of background we need to be talking about sustainability. It's not about doing a nice little project on the side, it's not about a little bit of improvement. It is really about fundamentally thinking about one's business model and whether that is sustainable in the future. That's what we're talking about here. It's the core of the business and how that can work in a Net-Zero and nature-positive world. And to quote Mark Carney, who said a few years ago that "Companies and industries that are not moving towards zero carbon emissions will be punished by investors and will go bankrupt". This isn't about doing a little bit of good on the side. This is about sustainability, it's about ensuring future of one's business. And I am really pleased to be part of this responsibility advisory group that Samuel mentioned at SIG where we think about these things, where we think about what do these trends mean, what does it mean to be leading in this sustainability transformation. And that's where SIG is such a great partner. So we showed you a little bit -- I showed you a little bit, these 4 elements of going beyond nice words, of going beyond just carbon, of going beyond the supply chain and going beyond business as usual. And on all of those 4 elements, we work with SIG because we believe that company partnerships are the way to solve this transformation. We can't just leave it to the government. We can't just leave it to the consumers. We can't just point at someone else and say, you need to solve this. It's something we need to come together and get to action together. That's how we can solve this. That's how we take it forward. Thank you very much.

Thank you so much, Thomas, for being with us today.

Thank you.

It's exactly input like that, that we appreciate also in the responsibility advisory group that helps us to shape our strategy and think beyond how we can stay at the forefront in terms of creating a competitive edge, but also securing our business into long term. Thank you so much for sharing that perspective. Now I think there is room for one or two questions right now if anyone has. I think you're also a little bit with us in the coffee break maybe. But if there is, in the audience a question that you want to ask to Thomas right now will be the moment. Jorn, Please?

Thank you. I'm Jorn from UBS. And to have the opportunity to be here on the stage. And may I ask you how you think about the packaging trends going forward? How do you think about plastic versus aseptic cartons versus cans? Is this already on top of your mindset? What you think going forward?

It's a massive issue. We heard about the issue of marine plastic. You mentioned that earlier. So especially for in Asian markets, for example, we see it as a massive issue. We've got a worldwide program working on issues around plastic. But I think it's important also, and that's something which we also do in our responsibility advisory group sessions is to not just look at the packaging side of things. Yes, there are improvements that can be done there and that have to happen, both in terms of the carbon, both in terms -- but also in terms of the plastic content. Then there's the whole issue around food and food waste. And that is massive worldwide, right? So we can't just isolate packaging and say, we're just going to look at how we optimize packaging, but we need to look at the food system and say how can we get rid of the 30%, 40% food waste, which is happening worldwide. And I think that's where packaging can be -- can play a really important role. So make packaging better in terms of carbon and in terms of plastic and other ingredients, but also think about how packaging can contribute to the overall sustainability of the food sector.

Is there another question right at the room for Thomas? If not, then thanks, Thomas, for being with us today. And -- thank you, Jörn.

We're going to take you now through a bit deeper dive into our sustainability strategy because we want to show you how that kind of defines our strategy process and the way how we define our product road map, but also then how we create value for our customer. That's why I would invite on stage the 2 colleagues from the CSR team, Karina and Christian, please join me here. The two are going to introduce himself in a minute. And you're going to hear from them a bit more about our sustainability strategy. And right after you hear from our Head of Global Account Management, how we translate that into value for customers and ultimately the business in deploying these solutions. So please over to you.

So Christian and I will give you a deep dive into our sustainability report. My name is Karina Boers, Head of Global Circular Economy & External Affairs at our corporate responsibility team. So I work on circularity of our packaging. I joined SIG in August 2021. Before that, I was working for the German Development Corporation and the United Nations on waste management projects, renewable energy and circular economy projects in especially emerging markets. And yes, Over to you, Christian.

Thanks, Karina. My name is Christian Bauer. Welcome. Yes, I'm expert sustainability in the Group Corporate Responsibility team and belonging to the team of architects that develop the design and the layout of our sustainability strategy. Before joining SIG 12-years ago, I've spent my time in science and developing sustainability for technology assessment for research centers in Germany. So rather from that sustainability agenda from science into corporate sustainability strategies and talking sustainability in SIG means talking sustainable packaging. And having opened the session already with key drivers for sustainability was a great moment in my life because half of the life we spend typically with other experts saying how to get the CEO on stage talking sustainability, and Sam, well you made my day and the day for my colleagues who always wonder how to get this going. But it's easy in SIG. I mean we create packaging for better. We have a very strong ambition. We have a very strong delivery in the past on sustainable packaging. And the overall idea is to deliver packaging that gives more to the people and the planet than it takes out. So net positive in essence, give it -- give more back than you take out, which is a big word, which is a big ambition. And thanks, Thomas, for getting the greenwash elephant into the room carefully. We think we deliver on that in an extremely robust and scientifically valid process because, first of all, we joined the net positive project that was driven by NGOs and scientists from MIT in Boston and other big brands like-minded like Dell or Levis to come up with principles what net positivity should be about, to make corporates moving in that path without being shut down, being greenwashing. At the same time, we took this blueprint to work on the business transformation compass, another big word. But with the Nestle's and the Unilever's to understand how we could create a regenerative and just transition. And just repeating what Thomas said, in essence, it's boiled down to materiality, focus on where you can make the biggest splash for the environment, for the planet. Be thinking out of your little system box. Be Regenerative, be restorative, think beyond your value chain and deliver positive outcomes, positive outcomes ideally larger than your footprints, and this is where we say creating handprints that are larger than the footprints that we cause and of course need to reduce. If we then take that all looking at to the portfolio, which you see behind but on the next screen also -- what gets us to perfection. And more intuitively, what we think is to -- could there be packaging that simply takes out carbon from the atmosphere? Could it be made from endlessly renewable materials? Could we completely fade out finite resources like aluminum where we have a bigger carbon impact? It should, indeed, in our case, bring more safe, healthy nutrition to everyone, but could there be more? Where is our role to make that safe and sustaining? And at the end, it should be, of course, a system that is fully recyclable, adding resources back, keeping resources in the loop. And this is what we have casted into our strategy. This is what we have casted into our sustainability approach. Our sustainability approach rooted in sustainable innovation, and we had Gavin on this, rooted in responsible culture which is, of course, the foundation with the 9,000 that are all behind this. And it needs to be a very simplistic or not simplistic, but just simple strategy, where you take the trees, the forests, regrow them, create more of that. We heard that from Thomas. When you have these renewable materials in the society performing as a product, get this in the loop, don't let that go back to the atmosphere, get us creating a circular and bio-economy. And with that delivering the utmost to lower pressure on the food system, to provide agriculture, to get every new nutrient that they produce into a product, into a packed product and not lost along the supply chain. And that all by being beneficial on climate. Reduce it. Go for Net-zero with our full footprint in the value chain, but think on how packaging systems, think on how our solutions could evolve into a carbon think over time. So this is all what I think shouldn't be just the words, but that should speak with our products. They should all be a touch point of what I'm just saying. So this is the moment to hand over to Karina, driving us through how our packaging speaks about exactly these deliveries.

Thank you, Christian, for explaining the net positive strategy. So how does it look like in terms of our product development? The net positive strategy is driving our innovation. As you can see here, we have a lot of Industry first. We have simplified our beverage carton structure to ease recycling. We have removed carbon-intensive material like aluminum, and we are committed to increasing the renewability share of our carton and in fact, committed to reaching 90% paper content by 2030. Now I will talk about more on how we keep the materials in circulation, how we drive our journey towards a fully circular packaging system by giving you a bit more insights on our Resource Positive action area. So what is Resource Positive? How do we drive circularity of our packaging? It's quite simple in the sense of we divide it into 3 main pillars. Number one is we need to design for recycling. So that means it should not only be recyclable, but it also should ease recycling. So we do simplify the structure of our packaging. We need to collect it, as we heard about marine litter. It's important to get it collected, sorted and recycled on the ground. So we aim to be recyclable at scale in all priority markets. So that we do that by our global advocacy approach and by partnerships. You see a lot of platforms that we're collaborating with, we are driving global advocacy to really ensure that we get our packaging collected and recycled everywhere. And our third pillar is on leading in renewability. So continuously driving up the paper content, as you saw on the product development road map and also increasing the use of renewable polymers, using less virgin fossil-based polymers. So you've seen a lot of these commitments have already been met in our product development. So where are we today? On design for recycling, we are proud to say that we are already fully designing our beverage carton to be designed for recycling. We have simplified the structure by removing the aluminum layer, making it easier for recycling, by removing one material. And we are already launching recycle-ready solutions for our retail Bag-in-box and Spouted Pouch packaging. And we commit to have all our segments of our bag-in-box and Spouted Pouch packaging, ready for recycling by 2025. On recycling at scale, we already recycled at scale in Europe. We are -- our beverage cartons are recycled above 30%, and we commit to meet a 70% recycling rate of our beverage carton in Europe. Globally, we aim to achieve recycling at scale through our global advocacy, through our lighthouse projects on the ground to showcase how to best collect, sort and recycle packaging and through industry collaboration because collaboration, as you all know, is essential for driving systemic change. And where are we today on renewability? Today, we already launched a carton that is 100% linked to renewable material. In fact, 76% paper content and 24% forest-based polymer. So now we have committed to increasing that 76% to 85% in our carton without closure by 2025 and to up to 90% by 2030. Why is this so important to us driving our paper content? Number one, the higher the paper content, the better CO2 performance of our beverage carton, so even better than we already are today. And we need to use less polymers as a barrier. Also, reaching 85% paper content will allow us to be technically recycled at paper and cardboard recycling stream. And this recycling system is actually widely available globally. And because of that, that will ease recycling everywhere we are in the world because especially in a country where today, specialized beverage carton recycling is not always accessible. So this is basically how we want to lead renewability today and in the future. So how do we drive circularity of our packaging, again, circular design, recycling at scale and increasing renewability today and in the future, and this is Resource Positive. So thank you. Christian?

Without trade-off on climate. So that's the next chart. Giving you the essence of what we do on climate on a single chart, sorry for being populated, it's my chart. It's in principle to approaches that we follow. It's the decarbonization of our corporate footprint that you see on the right above and it's leading on products with the standard products we have, but also with innovation against all of the substrates that we look in with LCA. So looking at the big splash that we make, we stand for about 2 million tonnes carbon emissions a year, which is a mid-size town in Germany for a year in its carbon emissions. And we divide that by the 29 billion liters we pack a year, and that gives the core metrics of what we are getting down to zero until 2050 with our science-based target commitment. Reducing that, cutting that by half, say, 52% by 2030. And that has been approved by the science-based target initiative as being in the first batch of companies who really can be proud of this commitment and the robust approach we take towards this. And it's the same. We try to understand how packaging performs, what happens if consumers pick our packs instead of another. And then we can talk about carbon savings, they make with their choices against other substrates like PT and glass and the green one shows that innovation gets us further down. Life cycle assessment is a methodology that standardize, allows third-party review and offers equal credibility like the science-based target initiative on any environmental claim that we make on carbon. The story to get that down is a big program that we are running with many projects. Key for us is to work with the suppliers. They take 2/3 of the share of carbon emissions in our total footprint, fading out the aluminum, getting them into science-based target making, working with them on innovation. These are the drivers. Our operations, Samuel, Ian introduced it. We have already 100% renewal electricity, and we are fading out of fossil energies carriers as soon as that we can, given that the operations are just 5% in the total footprint. And indeed, markets, we learned and roll out the low carbon portfolio but also drive efficient filling systems, and we will hear about that, too. And this is just getting our footprint down, taking our share for SIG's value chain, but indeed, there is a climate positive, more -- create more positive outcomes, deliver that in the society. Offers consumers the lowest carbon choice. Reduce food loss and waste, a big contributor to the global footprint on climate. Enable the ambient supply chain advantages for valuable materials by offering resilience and the longer shelf lives that we heard already and maintain the forest as an active carbon sink in our supply chain. Help forests to adapt to climate change, get money into them, use them simply to make us all able to keep them in their essential functions that they deliver and then, of course, go out, engage deeper, go for ecosystem restoration as we do with WWF. Being climate positive, a segue from Net-Zero which is coined for carbon into zero net loss for nature, that we've just seen on the right chart, likewise used by Thomas, and thanks for using it. And that, of course, builds first of all, on our forest focus. We make sure that the fibers we get are managed under responsible conditions means we have a sustained yield while we pick the tree, the tree comes back. At the same time, we do this under maintained biodiversity conditions where we source [ fibers ] from -- FSC makes that, FSC and it's principles, that ensures that the biodiversity is maintained and thriving in that area where we source fibers from. And that is then leading us in top -- on top engaging with the WWF on more projects, delivering in its entirety and when we are done in 2030, 650,000 hectares of restored and thriving ecosystems. But having learned and having already listed that it's not just the forest that we need to take care of, if we take it -- if we talk biodiversity loss, we can again orchestrize our entire action plan to deliver on preventing biodiversity loss. First, indeed, of course, getting our carbon emissions down as heating up the atmosphere gets species loss faster. But also preventing packaging going into the environment, keep it in the loop, keep it active, don't get plastics out there. I mean the simple imperatives and indeed recycle materials to deprive us from ever using virgin materials from further needing land for resources just to get them recycled. And on top, again, the Food Systems come in, we've just learned that agriculture is a big part of biodiversity loss driver. How can we deliver efficiency here? How can we pave the way for more nutrients coming into our system? And that is not just loss and waste, it's creating the resilience that keeps laws along the way, that keeps food safe until it reaches the consumer, doing the utmost here to make it efficient and inviting others to use our regenerative packaging system for regenerative products. Let's see how the appetite on customers is about this, and I would like to ask Christian to continue.

Good morning, everyone. I'm Christian Kern. I'm the Head of Global Account Management at SIG. In this role, I'm responsible for our global customers. Prior to this, I've worked for SIG as Global Account Manager for FrieslandCampina and then Nestle for almost 5-years. So I've spent a lot of time with these players. And I can tell you, in every business review meeting I had with them, sustainability was on the agenda. You've heard just now from my colleagues, Karina and Christian, that we lead the industry when it comes to sustainability, and we have a clear strategy along our four action areas. What I'm going to share with you now is how this makes a win with our customers. As you will see, our strategy is very much aligned with their objectives, and we are considered a key partner to help them achieve their commitments. Let's start with food positive. When it comes to our customers, their objective is essentially to provide healthy nutrition to consumers. Take FrieslandCampina, for example. Their purpose is nourishing by nature [indiscernible], bring health through food to as many people as possible. They value our aseptic technology because it enables them to deliver exactly what they promise. Package nutrition delivered to consumers around the world in a safe and affordable way without the need for cooling chains. Let me give you a very striking example. We're currently working with one of our multinationals to launch a tube-feeding product currently retorted in our aseptic [indiscernible] solution. As you can imagine, this is among the most critical categories when it comes to nutrient preservation. Moving to look at the second action area, Forest positive. Our customers are increasingly turning their focus on biodiversity. Many of our global customers have renewed their forest strategies and associated commitments. Nestle, for example, aims to plant 200 million trees by 2030. You've heard Thomas talk about our WWF partnership before. This partnership has the target to build 650,000 hectares of biodiverse sustainable forest by 2030. And that's a gigantic step forward. And it makes me personally very excited as I see a ton of collaboration opportunities with these global customers. Turning to Resource Positive. Almost all our global customers are signatories of the [indiscernible] Foundation and have committed to a transition to packaging that is 100% recyclable, reusable or compostable. And we support them on this journey. Across all our packaging substrates, we provide options that are designed for recycling. We have just learned from Karina that our aseptic carton is designed to be fully recyclable. With spouted pouches, we have introduced recycle-ready solutions for the retail. One example is [indiscernible], the largest producer of fruit puree for kids with whom we have launched a recycle-ready pouch. You can later on have a look, it's on the shelf over there. With bag-in-box, a key packaging solution for the institutional channel, we're pushing ahead with the conversion to recycle-ready specifications. We're currently running pilots with the largest players in the space, Coca-Cola and Pepsi Co. Now let me move to Climate Positive. When talking about climate positive, almost all our global customers have Net-Zero road maps with ambitious targets for greenhouse gas emissions reductions like we do. Nestle, for example, has committed to reduce their Scope 3 emissions by 50% by 2030, and that includes packaging. As you've heard before, our aseptic carton is best-in-class when it comes to greenhouse gas emissions, and they know that as well. This is why they have converted some of their sweetened condensed milk portfolio in Brazil, previously packaged in cans for decades into aseptic carton. And we do not stop here. We have always strived to advance our industry-leading solutions of sustainable packaging options. We introduced the first alu-free aseptic carton industry -- in the industry back in 2010. FrieslandCampina was among the first to launch in its iconic [indiscernible] brand. Last year, we achieved a breakthrough in this regard. When we have led the industry and introduced the first alu-free aseptic carton providing a full barrier for a 12-month shelf life. We launched this with our largest Chinese dairy Yili. In conclusion, our customers see us as industry leader when it comes to sustainability. Our strategy is aligned with their objectives. And we are considered a key partner to help them achieve their commitments. Now the great thing is -- the innovations I just talked about run on our existing technology platform. Our technology is future proof, and that's a huge asset for our customers because they invest for the long term. They know that our flexibility does not only provide them with the opportunity to deliver on their promise today but also tomorrow. And that makes our installed base a fantastic growth platform. You will learn more about our technology throughout the course of the day. But for now, I will hand back over to Samuel.

Thank you very much, Christian. Thank you so much, Christian and Karina. Great, round of applause for all of you. Because I'm anyway only the leading into the firework that the region is going to provide. You have learned about all the technology, you have learned about the sustainability benefits, you have learned about how we deploy our commercial model and turn that into a superior financial outcome. But where does that happen? It happens all at the point of impact. It helps in the regions. That's where we really create the customer and that's more specifically on the shop floor of our customers' plants, where our fillers operate 7/24, our field service engineers that there, and our packaging material has to perform. And the next point of impact is when the consumer grabs our products, the customers product, the joint product from shelf. So we're going to learn about how we deploy that from our regions. And I have the pleasure to announce Angela, please join me on stage, who talks about Asia Pacific. Please, over to you.

Thank you, Samuel. Good afternoon, everyone. I feel very bad getting you all back from the lunch break, very short lunch break. But I -- I hope that you will feel it's worth it with our presentation. So let's start with Asia Pacific. So first, introducing myself, my name is Angela Lu, and I am the President and General Manager of Asia Pacific. I joined SIG 2-years ago, managing Asia Pacific South business. And now I will be moving to Shanghai next month to manage the combined Asia Pacific business. I am very, very excited about the growth opportunity in Asia Pacific because of the huge population that we have and also the rising middle class and also in Asia Pacific, we have relatively low protective consumption for the liquid dairy. Okay. So where do we see the growth opportunity? First, we see that liquid dairy will continue to grow. And with our substantial infrastructure and footprint that we have in Asia Pacific, we believe that we are able to capture more growth with the right pack size and the accessible price points. Later, I will explain in the following slides. And second, we see that in the mega cities, consumers are increasing in the demand for the high value and also the more convenient, more functional, sustainable products. And also with the differentiated packs that we have with a unique shape and also the filling capabilities, we believe we can capture this opportunity. In those cities, we also see that chilled dairy is growing faster, the fresh dairy is growing faster. And with the expanded portfolio in the chilled, we can address this opportunity. And also similar to that, in the cities, consumers are dining out more and food service has been outgrowing the retail channels. And our bag-in-box solution with smart dispensing can help us to address it. So we have built the substantial footprint in Asia Pacific. If you look at your right side of the slide, we have 10 production sites and 17 Sales & Service offices. We have more than 400 fillers in the aseptic cartons in the field. And also, last but not least, we have passionated, highly capable localized team across the organization, from operation to service and also to the customer fronting commercial teams. And with this, we have achieved the fantastic results. We have achieved more than EUR 900 million revenue, which represents 31% of SIG's revenue. And we believe with the scale, footprint and people that we have, we are able to capture the huge growth opportunity in Asia Pacific. So as you know, flexibility is one of our key success factors. And what does that mean for Asia Pacific? Our customers can leverage SIG's system to tap on to a different pack size, such as 80 ml, 150 ml that is more unique to SIG in addition to the common type size such as 125 ml, 200 ml and 250 ml. And this enables our customers to capture more consumer demand because it can address the different accessible price points. And also, our customers can maximize their asset intensity and ROI on the CapEx investment while at the same time tapping into different channels with the different price points. So here, you can see the examples from the market, the unique way of tapping into it and when we talk about accessible price point, it does not mean always the cheapest one. It's really in the range of the different consumers. You always have 80 ml with the lowest price point. And then you have a different pack size to address different types of consumer. And with the increasing income level in the cities, consumers are demanding for more convenient functional products to enhance their experience. We have developed SIG Smile and also, SIG DomeMini in the past years. So they have been providing the fantastic platform for our customers to launch functional and premium products. So here, you can see the examples from Mengniu and YILI, that you can also see from the slide for the SIG Smile. And then Huiyuan, the leading [ NCSD ] player from China with SIG DomeMini. Our customers are launching more products with particularly leveraging SIG's special filling technology and there you can see from the right side for the examples of the product. Many of those products were co-developed with SIG in our technology center in Suzhou, where we have the world-class pilot plant and also very strong recipe development. So we would like to share with you the example from Nutifood from Vietnam that -- who is going to be the first one to bring SIG DomeMini to Southeast Asia launching nutritional drink under their brand, Varna. Let's go and see what they are going to talk about, how they are going to leverage SIG DomeMini to enhance the innovation and also to expand their portfolio to adjust accessible price points in the premium segment. [Presentation]

Consumers in the mega cities in Asia cares about sustainability as much as those in the developed countries. So YILI has commercially launched the first Terra Alu-free full barrier product during Asian games. I would like to share with you the YILI example and also let's hear from them. They are the largest and leading dairy player in the whole region and they have been partnering with SIG for the last 2 decades. Let's hear from them that how are they going to leverage about the SIG's unique capability to enhance their business and bring the partnership to the next level in driving sustainability. [Presentation]

Okay. There are 32 cities in Asia has a population more than 5 million. And we see fresh dairy growing very fast in those cities. So we have fully integrated the chilled business and also enhanced the capability in the past year. We've integrated the chilled filler assembly, we are building the chilled plant that is going to be a world-leading fully automated, starting operation from Q2 next year. We are also enhancing chilled innovation with -- in the multiple areas with our R&D capabilities. Once that opening that is going to enhance the consumers' experience, translating SIG DomeMini to the DomeMini chilled to bring excitement to the category and capture the on-the-go occasion. On the customer front, we have multiple wins in the cross selling. So we have customers that -- we have aseptic filler wins with the customers that were using 100% of the competitor offerings before, leveraging on our chilled relationship such as Uni-President and Farm Fresh. We also have aseptic customers expanding into the chilled area such as [ Dutch Mill ]. If you come to China recently, you will be surprised to see how many cafes are there, although China was historically a more tea drinking culture. And by the end of 2022, Shanghai has around 7,800 cafes, which is the largest number of cafes in the world. Luckin now has more than 10,000 coffee stores overtaking Starbucks as the #1 coffee chain in China. Starbucks -- for Starbucks China is second largest market for them. So with all of this, we believe that with the knowledge and also the track record in Americas, we can strengthen our system offering by partnering with a local partner and also to bring the smart dispensing to Asia as well. We started to engage Luckin coffee at the end of last year and by now, they are already testing the smart dispensing co-developed with SIG in their [indiscernible] stores. They have a very aggressive rollout play to 1,000 stores next year and by 2026 to the -- all of the stores. So I hope by now, you are as excited as me about the huge growth potential and opportunities in Asia Pacific. We have huge population, rising middle class and also, we have a substantial footprint in Asia Pacific to capture all of those opportunities. Thank you very much. And I would like to now hand over to Abdelghany to bring you to IMEA.

Thank you -- so thank you, Angela. Good afternoon and super glad to be with you today. And let's talk about IMEA. Welcome to IMEA. Welcome to 49% of the world population with growing demand for aseptic solutions. We're a partner of choice with our top-tier customers and we have unlimited opportunity with our expanded portfolio to grow further. My name is Abdelghany Eladib, I'm the President and General Manager of India and Middle East, Africa, I'm proudly been serving SIG for the last 7-years. And beforehand, I used to work for the top FMCG for 23-years. Let's take -- look into some statistics of SIG in IMEA. Last year, we closed at EUR 380 million revenue. We have 15 offices of Sales & Services. We have currently 4 active factories, 1 aseptic in Saudi Arabia, 3 Spouted Pouch bag-in-box in India, and the fifth is coming soon, as you all know, in India, end of next year as our aseptic carton expansion. Let's zoom back and talk more about IMEA. IMEA, 86 countries under my responsibility, and I'm currently active in 36 where we are active and present. IMEA, the highest growth region in terms of population, the fastest in terms of rising middle class. IMEA's population, more than 50% is less than 30-years old, who are in need of healthy packaged food to offer, and we're here to serve that. IMEA's population and the youngsters are heavily influenced by the social media, and they are very much in terms of insights, very much influenced they are looking for healthy food, they are looking for affordable. They are looking for on-the-go and convenient. And we are actually actively present, sorry -- we're actively present in our 36 countries to serve them. IMEA, in terms of per capita consumption is among the lowest globally, less than 10-liter per annum. So 1 over 6 in comparison to Europe. So think about the opportunity when we unlock that kind of potential. There will be decades and decades where we, SIG be able to serve that. So let's talk about our customers and how they are using our unmatched flexibility to grow their market insight and even grow beyond as export potential. I'll take three examples quickly. So Almarai in Saudi Arabia are using their white milk line to produce cheese and to produce cooking cream. Algeria, generally, the biggest dairy player whom we are actually 90% share of wallet is doing the same, producing cooking cream on top of juice and dairy. [ Betty ] in Egypt, one of the biggest players are actually leveraging the sizes and the shapes, not only to grow in the country, but now become an export hub in the whole of Africa. Arla, and if you would recall, last year, we've announced the first food filler in Saudi Arabia. Today, they are using the same line in differentiated shapes to produce use and happily to say, they have picked that from competition from their lines into our fantastic technology. Lactalis in South Africa, where we are now 100% share of wallet is leveraging shapes and sizes to differentiate between high value-add, high-priced brands and low ones and even introducing value add as custard in 500 milliliters. And last but not least, India, Parle Agro, the biggest and CSD player is leveraging our [indiscernible], our CB12 line, where we have 9 sizes to play in different price points. You will hear in a second, Nadia, the Chief Market Officer of Parle talking about our experience with them. In a nutshell, aseptic is going to grow. We, in IMEA, have the highest growth rate, we and APAC from 6% to 7%, and we're here ready to grab this opportunity. Let's now deep dive into one of the most interesting market in my region, India. Why India? India is the largest population country today. India is #1 in terms of dairy production with 220 billion liters per year. Today, it represents 23% of the world's dairy production. And in 20 years, this number will be tripled, and it will move from 23% to more than 47%. It will be the dairy for the world. And if you look into the 220 billion liter, you will find only 16% is in the organized. But if you even look into the 16%, you'll find 8% is in liquid dairy and then if we slice this 8%, you will see only 5% is today an accepted carton, Huge opportunity, but this fantastic opportunity is doubling every 3 years, again, fantastic opportunity to leverage. And we are super ready for that. We're super ready because we have a dedicated sales organization. We have a dedicated service organization. We have our training center there. And now we're partnering with all our top players in the market, call it dairy or NCSD. You're talking about the big players. You're talking [ a move ], you're talking Parle Agro, you're talking KMF, you're talking [ Gabor ] and so on and so forth. If you remember, Angela last year, promised the 30 fillers. And I'm happy to say, thank you, Angela. You did a fantastic job, not only you, [ Vandana ], I actually would call her, our country manager of India did a fantastic job and I only represent them today to say we're beyond 30%, we are actually more than 40 fillers, and we're super proud of that. One last promise we did last year, which is we are there and we're there to grow. As you very much know, we already started our building for our factory, and we will deliver on our promise by opening our India [ Ahmedabad ] factory end of next year to really add into our capacity locally to be better able to serve our customers. Let's now hear from Nadia, their experience with ours.

Good day, everyone. Namaste, my name is Nadia Chohan, I'm here to represent our company Parle Agro, but also to represent India. Whether through this video or even if I was there in person, I would never be able to do justice to explain the powerful opportunity that exists in a market like India. Today, India is a market of over 1.4 billion consumers, and our dream is to make sure that every one of these consumers at some point of time is consuming our brand. In 1985, we were the first company in India to introduce carton packaging in partnership with Tetra Pak. Since then, Parle Agro has gone on to pioneer several beverage categories in India. Indian consumers have experienced exciting innovations in [FSSD] juice-based sparkling drinks and dairy as a direct result of our efforts and vision in nurturing and building these categories. Over the years, we grew to become Tetra Pak's single largest customer in India. While SIG Combibloc has been knocking on our door since 1980s, we have never been able to kick off a relationship. But everything changed in 2022. The need for flexibility was higher than ever with the uncertainties in the market, making SIG Combibloc an incredibly relevant partner. Parle Agro has always believed in making an impact. We didn't just simply partner with SIG but started the relationship directly with a commitment of 12 lines which were commissioned in 12 months. Samuel and his team have been incredibly supportive of our needs and believed in our dream of refreshing India, all 1.4 billion consumers. This led to making one of our most special project stake wings. India's favorite mango drink fruity launched in SIG 65 ml pack for INR 5, a dream that we've had for the last 10 years, which we were unable to see through with the many challenges of the DCA 65 of Tetra Pak. With the launch of the Magic Pack, we intend to triple our carton packaging business in 3 years, which is currently at 3 billion packs. This pack will help us expand our distribution to 2 million stores from our current base of 1.3 million stores. Our apprehension over the years of joining hands with SIG was based on not seeing substantial investment or commitment to the Indian market. With the recent development of starting production in India, we believe our partnership has set to a good start and together, we can conquer the big Indian dream. The India opportunity is only as big or as small as you can dream. We enjoy dreaming big. Thank you for your trust and partnership and our vision, and I look forward to hosting any of you in India to see the power of this partnership in the marketplace. Thank you, and Namaste.

Thank you, Nadia. I mean, fantastic [indiscernible]. In case you are not familiar with Parle Agro, they are the biggest NCSD player in India. The revenue have exceeded EUR 1 billion last year. As you've heard here, we moved from 1.3 million outlets into 2 million outlets, okay? And now we've been able -- I mean, this was always in the market, 125. And they have always 65 milliliter classic Tetra Pak, and then suddenly, boom, we brought the 80 ml, our 80 ml pack, which really have changed the whole market. Really a big breakthrough in terms of consumption, in terms of market presence and in terms of flexibility. So we're super proud of our experience with Parle, and you will hear much more experiences to come. Now let's stretch our wings and think about what does our extended portfolio brought to the IMEA. And probably, I will actually take you into exactly 3 weeks from today into our Gulf food. Gulf food is the biggest -- one of the biggest exhibitions in the world, and it's the biggest in Middle East, North Africa. Our booth this year over 3 days has been the top of the show. We had the heaviest traffic on the whole show. And I can tell you, everybody, all the competitors have been looming around and say, "Hey, what's happening in here. And I can tell you it's our expanded portfolio. We had more than 160 leads. And I'm proudly saying that 2/3 of these leads were in spouted pouch bag in a box. We've not only been really rocking into the exhibition, but in our technology center in Dubai, we've installed prior to the show, our first spouted pouch machine. So our customers have been able to come experience, touch, see and feel the machine. I'm proudly saying by the end of the exhibition [indiscernible] which is a customer that we've been aspiring to really acquire and win on the carton business have really been marching, I would say, running to really sign our first total system spouted pouch with us. We're super proud that he will introduce yogurt in the market, and he is one of the biggest in the Libyan markets. Last, but not least, I'm super proud to really represent this exciting region, with great opportunity. We do have the right technology, we have the right innovation, and I'm proudly saying we have the right 900 great colleagues. I'll call them real hunters to grab this opportunity. Thank you for giving me this chance, and I'll hand over now to you.

Thank you, Abdelghany. My name is Jose Matthijsse and I'm the President of Europe. Now Europe is SIG's region with the most broadest and the largest presence. We produce cartons to fill milk, plant-based drinks, juices, waters, Tomato pastes, lentils, beans, soups, sauces and I could still go on. And we do that in so many packs. We start at 200 ml mini block. We go to compact block, Smile, Medifit, [Mid East line, slim line, dol vita] and everything in between that I haven't mentioned yet. You have today visited the largest factory we have and the oldest factory that we have. And my people here are extremely proud the number of different packages that they're able to produce, the amount that they produce and the high level of quality that they bring every day to our customers. Now Europe does not have a growing population. And our consumption might be at its max, but SIG in Europe is growing top line is gaining share and does so whilst nurturing very healthy customer relationships. And that's what I want to talk to you about today, how we in Europe continue to deliver this strong customer base and how we continue to deliver that this customer base still grows. It grows across segments, and it grows now also excitingly across substrates. And we do that on the basis of our superior technology. And that, of course, has been explained to you in the various booths that you have been to today, but we maximize flexibility we minimize waste during changeovers, and that delivers an excellent total cost of ownership that our customers love. And all of this, we're able to deliver within the envelope of increasing environmental demands. Actually, we are a front runner in this field. That's why customers turn to us. Let me talk to you about the different segments that we serve and the number of customers that we serve because if I say that we have such a broad base for the carton business, we're serving 130 customers, and we have around 100 prospects that we regularly talk to. On the spouted pouch and bag-in-box side, we delivered to over more than 200 customers in Europe. And they are in all segments, across all segments. And we are growing in all segments. Now on the slide there, you see dairy is, of course, a stronghold for our business for our aseptic technology. As you can see on the slide, we've been growing very nicely in Europe in the dairy sector. And if you can imagine that dairy consumption in Europe is flat. The fact that we are able to deliver such healthy and consistent growth also proves that we are able to consistently grow share. And within dairy, the margins are not the highest. So the fact that customers consistently turn to SIG to buy new lines or change lines into SIG lines shows the competitiveness of the SIG system that we supply. Now let me talk to you about two customers who've changed over to SIG technology in the past 12 months. Muller Milk is the largest German independent dairy and they have taken the decision after they had to renew part of their machines installed to go to only one technology. And knowing both ours as well as that of competition, they have wholeheartedly chosen for SIG. So as of now, their entire retail brand family size business, is running on SIG lines. And it's very easy. There was one driver that drove these people to change over to SIG and that was our total cost of ownership approach. Knowing those technologies, they said, yes, we go for SIG and they're very happy. No change -- fast changeovers, low waste and a happy customer. On the other side of the slide, you see Solarec. And Solarec is a Belgian dairy cooperative. And I can proudly say that it has been the work of years of my team and many people in this room. But I can proudly say -- it's our first Belgian dairy customer ever. One year ago, also they decided to change their entire factory towards SIG technology. And so we sold four lines. Three of them went commercially operational last week or 2 weeks ago, even already. The drivers for [ Solarec ] to change was the flexibility of our system and you see that they changed into a midi format line or the flexibility of the system and also our service organization because SID in Europe has service engineers across all countries that speak the language of the local maintenance organization and the language of the local operators. And we are always nearby. And that customer centricity made for [ Solarec ], the change to say, I go for SIG. Now if we talk about that [ MediPharma ] line that they chose for, and I think you've seen that also when you were in the training center. But let me explain one more time that with this one line, if we combine the sizes, the formats and then the different structures that we can run on that line, a customer can produce over 70 different products, and that has nothing to do with a different label or a different recipe in it. So that is an enormous opportunity for customers to serve a variety of customers, again, of their own, a difference of private labels, retail labels and their own brands. And again, we do that with extremely efficient change over time. Now of course, in Europe, sustainability is a big topic, and we are moving into more sustainable structures. And an important one in that, of course, is more and more structured without aluminum. A couple of weeks ago, a new customer of ours, also a dairy customer, came to visit us. And this customer is also buying its first SIG line. So this plant manager and a colleague was here and we explained how we were doing in the project. And then we all went together to the general assembly hall, where you were as well today, I believe. And so my colleagues were explaining our technology to this customer and the ultrasonic ceiling and how it made it possible to change over from one structure to another very fast. And this plant manager really turned around to me and he said, changing from a structure without aluminum from a structure with aluminum to a structure without aluminum so fast. Do you know that your competition, it would take a day to make this change over. I was, of course, very proud to hear that, but it also brings us to that very important discussion that we have in Europe. We are all aware of the Paris Agreement and Mr. [ Valeco ] this morning was much more able to discuss and present the topic than I am. But we are all aware that we need to change in we need to reduce our waste and we need to find better ways to reuse and recycle our waste. But of course, we need to do that with those solutions that have the lowest CO2 footprint. To make the Paris target, we need to choose those solutions with which we really reduce global warming. Now our cartons do very well in depth. And I think you know those numbers really well it's very important to realize how we have gone on a journey with more and more sustainable structures to continuously reduce the CO2 footprint of our packs. And our customers have gone on their journey with us. But so far, we were only able to supply our dairy customers with structures that had no aluminum in it and polymer based on renewable polymers and so on. Now it's very exciting that also in Europe, we can launch an allo free structure that has full barrier capabilities shelf life remains as high as it should be and it reduces low CO2. And that is so important because our customers are supplying to retailers, and those retailers are talking louder and more frequent about Scope 3 and CO2 as well. They're even asking our customers now specific CO2 footprint of specific SKUs. So our customers turn to us and say, "How does that work?" and we are very well able to supply them together with the colleagues with the right data, proven again on science-based targets that we are lowering the CO2 footprint. So that's a great journey that we're on. The proven track record that SIG has in this field is a good starter with customers but also the development road map that we have going up to 85% paper and 90% paper shows that we are a customer that we are a supplier that you go on to on this journey with. But what is better than to let the customer talk about this. I will show you [indiscernible], who is the CEO of [indiscernible], Dutch juice producer. He will explain why they have chosen move from plastic to Carton.

Good afternoon. My name is [indiscernible], I'm CEO of [indiscernible] of fruit juices and soft drinks in the Netherlands and in Belgium. When we bought [indiscernible] 5 years ago from [indiscernible], we produced 150 million liters per year. And at this moment, so roughly 5 years later, we are selling 220 million liters in the year. Key successful factor was, of course, innovation in product development with sugar reduction, [ on Cal ] initiatives, new categories, in new countries, in packaging innovation, and we need a lot of sustainability improvements. And in all these areas, we have been closely working together with SFA and have a great support of [indiscernible] and a team. [ As he pays for us ] not only a supplier of garden or production lines, they're really a partner in business from finding them customers, helping with new packaging technology, we're helping to make difficult decisions in the sustainability choices we have. Our biggest project with [ SEK ] in the last 3 years with [indiscernible] to further reduce our CO2 emission, we start looking in 2021 for alternative packaging for our glass and [ pet ] bottles with the [SEK] combismile, which can produce basis tools and packs with gaps in different sizes, we really choose for flexibility and sustainability. We now can move to carton for 100% of our store. Together with [ SEK ], we choose, we showed our trade points that are [batch delivered a 7%] reduction, almost 50% less packaging weight and a 90% reduction in focal materials. The new packaging is very well accepted by the trade and by the consumer, and we are really outperforming our former packaging bottles and [ pet ] bottles and glass bottles. SEK has really helped us to grow with packaging innovation. We have a good partnership, and we hope to continue that in the in the future. Thank you very much.

Now we've spoken a lot about cartons but our customers are very excited about the new offerings that we have with our spouted pouches and bag-in-box technology, we can offer our customers opportunities to tap into new occasions more on-the-go occasions or beyond the retail channel like food service and so on. Spouted pouches in Europe are very often used for enhanced products like yogurts with extra proteins or fruit [indiscernible] with extra vitamins, and there are some examples in the back. Bag-in-box technology brings dairy but also juices to food service, catering, hospitals. You might have had coffee today of the [ Lattiz ] Barista who is in the back over there, and the [ Lattiz ] machines are fully served by bag-in-box technology from SIG. Why do our customers like to have this conversation with us? That's not only because of the extra opportunities that we offer. It's also because SIG does not only supply consumables. SIG offers the consumables together with SIG technology and together with SIG service and knowing us as a very reliable partner, this makes the conversation completely [indiscernible]. Now I had a great video of [Rene Pico] and the plant manager explaining very well to you how happy he is and how confident he is about his bag-in-box lines that he bought for ice cream. But the sound wasn't really good. So in the end, we said okay, we will not define with these messages, but we will make sure it becomes available online. But [Rene Pico] is a customer of 20 years with SIG has a number of carton lines and now has acquired two bag-in-box line for their ice cream going into the food service channel. Summarizing in Europe, we consistently create value by superior technology, by packaging that answers the increased sustainability demands and by a customer base that is consistently growing. With bag-in-box and spouted pouch offerings, we offer our customers new opportunities for on-the-go occasions or beyond the retail channel, and our customers are very excited to go on the journey with SIG technology and SIG support. Thank you very much. And I hand over to Ricardo.

Thank you, [ Jose ]. And now we keep moving west. And we talk about Americas. So good afternoon, everyone. My name is Ricardo Rodriguez, I'm President and General Manager for SIG in Americas. I joined SIG in 2003, so 20 years ago. And today, I would like to show all my excitement about this region. Americas is all about growth. We have the largest food service market in the world, where we see many opportunities for us at SIG. In Americas, we have 2 of the top 10 largest aseptic market in the world. Brazil and Mexico, where we are very well positioned. In Americas, we're also leveraging the very nice capabilities we built in Brazil. To the rest of South America to the core to other key areas in South America. So we see a lot of geographic expansion. So all in all, it's a journey of growth with many growth opportunities as we will see in numbers in the next page. So from the north of Canada to Tierra del Fuego, this is a huge -- this is a vast continent with a huge market. So in such a huge food and beverage consumption plays perfectly to our strengths, both in aseptic and bag-in-box and spouted pouches. As mentioned before, here, we have the largest food service market in the planet at 2 of the 10 -- 2 of the top 10 large aseptic markets in the world. Here, we are very well positioned given the high number of feelers in the running in this market. Also, the 9 production sites, 2 of them in carton and where we generate revenues of roughly EUR 700 million. So a huge market where SIG is very well established to grow. And as we talk about significant growth opportunities, where do we see the major ones? Three. So growth in food services, where we are leveraging our smart solutions, our smart systems, as you saw in the booth presentation delivered by [ Glenn ]. Growth in the existing aseptic markets where we are leveraging our partnerships and portfolio. Growth in the neighboring countries of Brazil, where we are leveraging the successful track record we built in Brazil to the neighboring countries, as well as the production capacity of Curitiba to export to South America, isn't that an amazing set of opportunities. Then let's shed some light on that in the coming pages. Start with the U.S. We see a lot of opportunities in foodservice, where we partner with leading players to supply the quick-service restaurants like Starbucks, like McDonald's. Also in the U.S., we see increasing conversion of fresh milk in shelf-stable milk, a key driver for this is nutrition in schools. By moving south, we have Mexico, top 6 global aseptic market. It's a very consolidated market. And there, we partner with all global -- the leading players like [ Santa Clara ], it's part of Coca-Cola, Lala, Alpura and [indiscernible]. To serve the carton market in Mexico, we are starting up now our new plant in [ Queretaro ] to serve Mexico and also all North America. And it means we can definitely accelerate our growth in this region. Moving now to South America. Let me take you home to Brazil. The second largest market in aseptic in the world. There, we grow in partnership with global players and also with some local giants. And to serve this market, we apply a unique solution selling proposition, solution selling approach that we will describe better later. Recently, we have also decided to enter the neighboring countries of Brazil the so-called Patchy region, [ Pachistans ] for Peru, Argentina, Chile, Colombia and Ecuador and also to leverage the production capacity of Curitiba in Brazil. Let's then further explore some of these great opportunities in Americas starting with food service in North America. Food services in North America is not only a huge market because estimated value is around EUR 8 billion, it's over USD 8 billion. It's also a fast-growing market, estimated to grow double digit in the coming 6 years. And SIG plays a mission-critical role in this value chain, both in carton and particularly in bag-in-box. It means that when you order a coke at McDonald's or refresher or cost-based recipe at Starbucks. You are very likely enjoying products made of ingredients have been delivered to the quick service restaurants using our packaging solutions and innovation plays a decisive role in this business. It means that we keep discussing opportunities, and we keep incorporating new solutions and attributes through [ fitments], through new openings through also new structures, new sustainable structures to reach superior performance. Now let's hear how SIG creates long-lasting relationships and through partnerships with -- by listening to our customers. Let's hear that from Coca-Cola.

Hello. My name is [ Sean Lee ], Senior Vice President and Chief of Customer Experience for the Coca-Cola Company. And I appreciate the opportunity to provide commentary on our valuable partnership with SIG. As you all know, SIG is the leading global provider sustainable, innovative and flexible packaging solutions with 170 years of experience in the industry and outstanding innovation capacity. At the Coca-Cola Company, we rely on high-quality, multilayer hexane film bags, which we affectionately call BIB or bag-in-the-box. That acts as the core package material for our syrup, the key ingredient in our fountain beverages. SIG has industry-leading expertise in renewable materials, lightweight package designs and mono-material barrier films that help Coca-Cola continue to drive our sustainability journey. You also help us ensure the continuity of supply of our bag-in-box for all 7 of our plants in North America, in addition to our global facilities. SIG is a great business partner with vendor-managed inventory capabilities, helping us maintain our current assets across our syrup manufacturing footprint. As we continue to evolve our partnership, we at the Coca-Cola look forward to working with SIG on the development of new technologies that will give us a competitive advantage within the foodservice industry like fully recyclable BIB bags, which currently are being tested in China. We also look forward to the continued delivery of high-quality packages to our foodservice customers, focusing on sustainability to reach our World without Waste goals by 2030 and reduce our packaging footprint. Thank you, SIG and Cheers.

And thank you, [ Chen ]. Isn't that an impressive testimonial from Coca-Cola? Now that we have covered North America, let's move south. Let's talk about how we will leverage -- how we are leveraging our platform and our partnerships to further grow in Brazil, the second largest aseptic market in the world. In South America, we partnered with global companies and also with some giant local ones. And to serve this market, we have an amazing solution selling approach with unique and why is that unique for three major reasons. So first of all, as we see on the left side, we have taken flexibility to the next level using our Ninja high-speed solution. It means that we have added to our size and format flexibility on other dimension, which is the possibility to fill a wide range of viscosities. So customers like Mokoka, a strong regional one is able to run -- to use our feelers to run chocolate milk, liquid products like chocolate milk and [indiscernible] and also very viscous one like the delicious sweeten condensed milk. So better responding to the seasons and to the market opportunities. Second, the SIG size and design flexibility also gives our customers the possibility to explore many opportunities in the market. For instance, besides feeling standard size -- standard designs. Customers can also go for smaller sizes and explore different price points, which is especially important moments of higher inflation. Let me give you one example. Nestle has become market leader in flavor milk in chocolate milk in Brazil with the brand in [indiscernible] by reducing sizes and its price point, and therefore, increasing penetration in areas with limited disposable income. Third, we are deploying our digital platform to support our customers with a broad range of modular solutions, taking definitely our technical services to the next level. So we are not only supporting customers to digitalize and to eliminate paper. We are going beyond by offering them solutions to increase efficiencies with end-to-end approach and also to implement the best core management systems, the best food safety standards. So this is the case of [ Britvic ], a British company leader in juice and nectar fielding carton in Brazil. So they have recently contracted our digital quality management system to equip all their plants in this region. Now that I have described the great solutions we are using to expedite our growth in Brazil. Let's talk now about our ambition to expand these opportunities into the neighboring countries of Brazil. So we are entering and growing at the -- at this important aseptic market by leveraging all the solutions that I have just explored before. So using our solution selling approach, we have started partnerships with global players like Coca-Cola, in Chile, like in Nestle, Ecuador and also with some national leaders like [ Colon ] in Chile, like [ ARCO ] in Argentina. So in the so-called patchy region, we have a very fast-growing business which served by our plant in Curitiba. And this year, we have got another possibility of supply with our new plant in [ Queretaro ], in Mexico as we will see in the next page. So we are ramping up in 2023 our state-of-the-art plant in Mexico. So it means we make our supply chain much more agile, much more competitive and particularly for Mexico and for the whole North America, right? So it's an important move also on the cost side as we shift from high-cost supply from Europe to low-cost production costs -- low-cost countries like Mexico, production costs. And as a result of that, we see already the acceleration of our growth in this region. So this is the case of [ Santa Clara ]. Our major customer are very big customers we have in Mexico, which is the largest dairy enterprise of Coca-Cola worldwide. Santa Clara has been expanding with us and has just contracted three additional fillers. So it's good news that comes together with the plant. So with the new plant in [Queretaro], we would like really to accelerate our growth in this great region. So in conclusion, Americas, we are very excited about the big opportunity we see in Americas. There, we are leveraging we are -- it's all about growth. It's growth in foodservice. It's growth in the largest aseptic market. We also see growth expanding the successful trajectory in the neighboring [ counts ] of Brazil. There, we are very well positioned to grow by leveraging our partnerships, our platform and definitely our new plant in Mexico in [ Queretaro ]. Thank you very much. Now I hand over to you, Samuel. Thank you so much.

Thank you. Thanks to all my regional colleagues. I must say I really enjoyed. I hope you did too, to listen to all these customer success stories to have the privilege to have such great partners that have helped us with their testimonial today, and that bring into life and into much more better context how we deploy the solutions that you have seen over the course of today. I can imagine after this full load this full day, you're going to dream about SIG tonight and SIG cartons. But we don't want to let you go before not also adding some numbers to that dream. And that privilege comes to the CFO. I have been at 1 point in this position. Then you always come last on this event. But [ Ann-Kristin ], why don't you join me here on stage. It's my privilege to introduce you as the new CFO and you're in week #3. So I think all of our audience also wants to learn more about yourself. And I think that's the perfect platform to introduce yourself. So thanks a lot for being with us. Welcome.

Thank you so much, Samuel. Good afternoon, everyone, also from my side, as Samuel said, so it's my week 3. And I'm super thrilled to have joined this fantastic over here. So that was a good decision, I believe. And yes, why do I think this? So first, I'm very much impressed about the strategic clarity of everything that we have been presenting today. And also my observation from the first 3 weeks is that we have a super good focus on execution. Also, I very much like the role that our packaging substrates are playing in addressing some of the burning sustainability questions that are out there. So this is a super strong growth business as we have seen. We earn superior margins, and we have a very strong cash flow generation. All of this making the business very attractive for our shareholders and generating decent returns. So it's my pleasure to summarize a bit the midterm outlook that is made up of all of this, what my colleagues have just shown to you. But before I get there, let me spend a few minutes on introducing myself. So my name is Ann Erkens. Don't get confused by the name. This is my full official name, but I usually just go by Anna to make it easier for everyone. I'm 48 years old. I'm a German citizen, born and raised in Hamburg, but I have spent more than 20 years exactly here in this area. I'm coming from [ Henkel ] joining with 22 years of experience, have worked there in the finance area and the last 6.5 years. I have been the CFO of the [ adhesives ] business, which is the largest division of [ Henkel ]. Super nice business was EUR 11 billion sales and a return on sales in the mid- to- high teens. That business is also extremely complex, which is nice for any person working in finance because you can really add value by making the business transparent and making sure that everyone has the same understanding of what should be delivered and setting the right priorities and capital allocation. The last 4 years, in addition, I was also in charge of the Global Operations and Supply Chain function for really a super large network with more than 100 production sites and with a very clear mission of improving processes and systems that we use on a global basis to make much more sense of the data that we generate and take the right conclusions. And with this, not only taking conclusions, but also instilling a stronger sense for performance management in that area. I have very much enjoyed my time there. But now I felt it's a super good moment to think about -- dive into something new. So when they had [indiscernible] called, I really said this is probably a super good opportunity to broaden also my horizon going forward. So now let's take a quick look at a financial overview to summarize a bit of what we have seen because without this wouldn't be complete. So we have a robust and resilient portfolio. Let's look at three different slices on this one. So number one, the revenue by product, the majority, of course, of our sales comes from the packaging substrates, the product business. But it's complemented with two very important smaller segments, the filling lines and the service, both of them helping us to create exactly those tight relationships with the customers that create the stickiness of the business. Looking at the revenue by substrate, 80% is still carbon with a huge, huge, huge majority being an aseptic and 20% bag-in-box and spouted pouch. We also have a very nice distribution of our global revenues, with the large regions all around 30%, if you like, and IMEA a bit more 10%. And if you add now India with approximately 2% to 3%. That's going to be 12% to 13%. So I have tried actually create a bit of a competition between Abdelghany and Angela earlier to say, so who's going to be that region that has stronger growth going forward now that we move India over. And actually, I very much like the response. First, there was, yes, of course, we are all in for competition, but actually, let's not forget, competition is outside, and we're going to work together as one team. So also, let's take a quick look at the development over the last couple of years. I think this is impressive performance when it comes to growth and returns. So first, on revenue. 2 years ago, this was a EUR 2 billion business. And we're going to end the year 2023 above EUR 3 billion. So that's a super strong development. When we look at the EBITDA bar, you would see them similarly in the same direction. After 9 months this year, we already have more profit in the box than we had in the full year 2021. Looking at the margins below, yes, this is a super attractive business. But we all acknowledge in 2022, we had the dip driven by the acquisitions and also the dilution from the input cost and inflation. You see that after 9 months this year, we are back to 24.9%. So clearly catch up and working into the right direction. Last but not least, free cash flow. Also here, you see a pretty good development. However, I also wanted to specifically call out the seasonality of our business after 9 months this year, we are at minus 80. All of you know that the majority of the cash flow in our business is happening in Q4, and we are on it. So I also thought you might find it interesting if I tell you a bit about my assessment when the headhunter called and how I look at the business, whether this is something good and interesting where I would want to work. It all starts with growing end markets. I think you heard from [ Christophe ] all the trends. So that is super clear. Everything related to emerging markets opportunities but also to the sustainability opportunities that our portfolio delivers. Then proprietary technology and leading innovation. So you would think carton, why is this so complicated? But I think [ Ian and Gavin ] have nicely illustrated that the aseptic is complicated. And it's a high-tech business actually. And that also make sure that there is not too many companies out there that can make this happen. Also, are the innovations that we have delivered. I think we -- a couple of times today, said, first in, first in. All of this, of course, helps us command that premium in the business. We also talked a lot about our customer relationships. And the video testimonies that were shown, I think, were super great examples of how we work with our customers. We co-invest. And with this, we usually have long-term contracts, 6 to 7 years, very often also prolonged into a second cycle, which creates exactly that stickiness that you want to create in recurring cash flows. On value selling and return mindset. So not surprised that value selling is high on the agenda here because we don't compete on price, we compete on total cost of ownership and the value that we deliver to our customers. We're also deeply embedded in our customers' operations on the digital end and, of course, also on the service. And so we are close, and we know what's happening then. Still, there was some things that surprised me from the outside. Of course, you don't have any fantasy how versatile and flexible our platform really is. So the change over time. So I think Formula 1 levels. And Jose has also mentioned it, so really outstanding, and that is exactly what the customers also need and especially these times when brands think about smart pricing. Last but not least, just two points on efficient financing. We are all clear on the opportunity on co-investing, but also collecting upfront cash that finances our growth as well as volume rebates that we have with our customers, which is also a very good way of securing cash flow. All of this together leads to steady cash generation and the SIG team since the IPO has delivered more than EUR 1.2 billion in cash. I think that's an impressive number. Now coming to the midterm guidance. Just quickly on the top line composition plan, 4% to 6% confirmed as our midterm guidance. And I think you heard all my colleagues talking about very much in detail the different concepts that we have behind. So again, Christophe, on all the market trends, we had Angela and Abdelghany talking about the opportunities in emerging markets. Jose was talking about share gains and also the variety of product that we can fill in our packaging substrates. And then last but not least, Ricardo and also Angela talking about the opportunities in the food channel. All of the opportunities are nicely mapped out and execution is underway day after day. On the EBITDA margin, we're also confirming to come back to more than 27%, very straightforward with a couple of levers. Operational leverage, of course, from volume growth, innovation premiums, emerging market growth, value selling and the efficiency that Ian has laid out in detail in the beginning also from operations, procurement and the remaining synergies from the integration. So all of this together on 1 slide, 4% to 6% organic growth confirmed, more than 27% EBITDA margin. And the three major building blocks of our capital allocation, 7% to 9% CapEx of sales unchanged, a dividend payout ratio of 50% to 60%, unchanged and also the net leverage target of 2x with in between target for the end of 2024 of 2.5%. All of this confirmed, and I believe with this, you all agree with me that this is a fantastic business with nice growth outlook and superior returns that will make our shareholders happy, I hope, over time. And yes, with this, just handing it back to Samuel.

Thank you so much, Anne. And that gets us to the end of a very long day, but I hope exciting day.