Wienerberger AG (WIE) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. A warm welcome to the Wienerberger earnings call on our Q3 2023 results. Our Board representatives today are our CEO, Mr. Heimo Scheuch; and our CFO, Mr. Gerhard Hanke. They will walk you through the presentation and are ready to take your questions afterwards. I will now hand over to Mr. Scheuch for the presentation.

Thank you, Sarah. A warm welcome from Vienna from my side and Gerhard's side and the whole team. Thank you for joining the call. We will walk you quickly through the different subjects concerning quarter 3 and the outlook for the whole year 2023. Let's have a quick look to the results and what has happened so far. If we have the presentation before you, I think we have sent it out, then you see that, obviously, the challenging market environment has continued. Geopolitically speaking, I think you have followed all the different events that take place in Europe, outside Europe, and it's not necessary to talk about the implications it has on certain items also regarding our business. The softening end markets, we will talk more in detail about them. But we have seen obviously that the inflation has somehow come down in Europe and also in the U.S. But still mortgage rates remain on a very high level or have been even increased as we seen in the U.S. So all in all, it has an impact on our end markets undoubtedly for this year. And you know this sheet, we have discussed it in detail at our Capital Markets Day in Belgium last month, if you look at the different end markets, mainly the 3: new build, renovation and infrastructure in Europe and North America, our major regions. You have seen in new build, obviously, a decline on average, about 35% in Europe in new build overall and about 20% in North America. Obviously, it goes without saying that we have differences here with respect to specific markets. Some are down more, some are down less. In renovation also in Europe, it was 15% and 3% in North America down. We have seen here also different developments in end markets. Renovation for us, Wienerberger, means specifically the roof business and, to a lesser extent, also in the infrastructure/in-house business for piping and a little bit on the facade as well. The infrastructure business, and I think this is a positive note also, if I may, in this context. It's down less as we originally have foreseen in North America where we have more or less a stable market environment and also in Europe where we'll see also a certain sort of stabilization of this trend in Europe and the better market trend in Eastern Europe with respect to infrastructure. So when we look at our reaction, I think it's very important that we keep in mind that Wienerberger has implemented a very proactive cost management. Gerhard and myself will talk more in detail about this in a minute. And also the self-help program has continued and will continue also in the future. So we have intensified all of our measures to flexibilize fixed cost, which we have started, by the way, already last year and especially have reinforced them this year and, due to the declining end markets, have put a lot of emphasis since half year on the working capital management and the reduction especially of inventory and CapEx, which you will see, especially in the fourth quarter. When you look at the proactive cost management, it contributed roughly a little shy of EUR 50 million; self-help measures, about EUR 34 million. Here, we have done an enormous effort in order to reduced the fixed cost base of Wienerberger. Price over cost also very impressive the outperformance in this declining market environment with about 4% to 5%, depending on the end markets. So here, you can see that Wienerberger has, in the first 3 quarters, EUR 656 million (sic) [ EUR 665 million ] EBITDA, performed well, and the margin has been kept on a very high level, above 20%. So a strong performance considering the end markets and clearly, again, outperformed them. So I think here, a strong set of results also in the third quarter, outperformed our end markets and maintained our high profitability. Two words on the biggest transaction that the company has done in recent years. We are happy, and particularly when you look at how complex such transactions are these days, to report to you that we have now all, and really all, the necessary antitrust approvals. By the way, we had to go through 9 different approvals in Europe, and all of them have been obtained without major remedies. So no material remedies, no sales offenses, no major ones that will influence the business in the future. So that's very good news. We are now waiting on the secondary transaction. You know that the scope of the transaction for Wienerberger did not include all the assets of the Terreal Group. So some of them are sold to a Swiss company. They are in front of the antitrust authorities right now, are progressing well. And we, meaning the sellers of Terreal and us, expect the final set of approvals for this secondary transaction that has nothing to do with ours for the end of the year, beginning of next. But as I said, from our perspective, everything's done. And we can use this time now in order to prepare the integration of the scope that we will integrate. One item that I want to mention also at this stage, none of these numbers, none of the earnings, other things, included in the guidance for 2023. So we will sort of update you as it comes. And when closing takes place, we will make an update of the relevant numbers that are important for you. So if I hand over to Gerhard for the financials, please.

Thank you, Heimo. As just mentioned, this is a strong set of results, the quarter 3 results, the quarter 3 numbers. Revenues are close to EUR 1.1 billion; EBITDA, EUR 211 million. Operating EBITDA, I think, above expectations, and I will also explain what are the main drivers are that we reached the EUR 211 million. And I think more important in the quarter 3 that profitability is on a high level. It's still close to 20% in quarter 3. Let's look in more detail into the revenues, what are the main drivers on the revenue side? The revenues went down around about 15% in quarter 3 whereby, yes, markets are lower and weaker, so the volume or the market decline itself contributed with around about 17%. As we just said, in the Western Europe ceramic part, we see that the markets are lower than in quarter 2. On the other side, we see a stabilization, respectively, an improvement in Eastern Europe, especially on the ceramic side, that quarter 3 was above quarter 2 and quarter 1. So this is a positive momentum also where we see, okay, stabilization is there and even a slight improvement in the ceramic business in Eastern Europe. And I think more important even is the positive dynamic we see in the whole infrastructure business. We see that volumes are picking up not only in Europe, also in North America. And also this trend, going forward, we see the same momentum also in October and also in the first days of November. EBITDA-wise, we generated an EBITDA, as mentioned before, of EUR 211 million. The EBITDA is mainly influenced basically firsthand by the lower volumes, clear. On the other side, by all the countermeasures, what Heimo just mentioned in the beginning, our cost management program, which contributed around about EUR 23 million to EBITDA; the self-help program with EUR 120 million; and also the price over cost contribution, which is above EUR 25 million. So all in all, we were able more or less to have the impact of the volume decline. And this is also what led us basically to the EUR 211 million in quarter 3. Mentioned before, when we look to the regions, I think the regions itself, I think the positive news is that we see a stabilization in Europe East compared to the first half year, that quarter 3 was clearly seeing some first signs of the recovery, a more positive development. We see also first government states, which are announcing first subsidies, fiscal subsidies, like in Poland or in Czech Republic, which are supporting basically also the construction activity. And this basically is also showing us, so this we'll find back in our sales dynamic or in our demand basically in quarter 3 when it's about Eastern Europe. Europe West and North America are more or less as expected, but it's about the construction business or the ceramic business itself. And as mentioned before, the infrastructure is definitely something which contributed positively in quarter 3, and also we see a more positive outlook also on the infrastructure business for the months to go. What does it mean for the first 9 months? It was already mentioned, we announced revenues of almost EUR 3.3 billion; and EBITDA, an operating EBITDA, of EUR 665 million; and as we heard before, an operating EBITDA margin of slightly above 20%; and also a strong net results of profit after-tax of above EUR 300 million after the first 9 months. Quickly go through also the revenue bridge. Major drivers here is, again, volume and price. After the first 9 months, price is up with plus 10% on a year-on-year comparison. Volumes are down with around about 20% on a year-on-year comparison. And you see also a rather strong impact on the FX side and also a smaller one on the scope side, which brought us finally to revenues in the size of small EUR 3.3 billion after the first 9 months. EBITDA-wise, as announced, as mentioned before, EUR 665 million for the first 9 months. Again, here, yes, it has influenced the decline basically by market volumes, which went down and which is also what we've seen in our P&L due to lower utilization of our production sites. And on the other sides, we're consequently very disciplined. On the one side, do our cost management initiatives. And on the other side, we consequently run our program for self-help initiatives. So this is basically contributing strongly to the EBITDA performance of the first 9 months. And yes, strong pricing. I think it's clear also there, we still have prices at plus 10%, above prior year, for the first 9 months. And also there, you see that there is a strong price over cost outperformance also which is contributing to the EUR 665 million. As just mentioned, we keep going with our cost management initiatives. We started already last year when we have seen the first markets started to decline. And we consequently go that way. So this is something which we'll not stop by the end of this year. We will also continue. So it is something where we consequently flexibilize more or less our fixed costs, the first focus. It is not run like the self-help program. It's really a sum of initiatives where we take out fixed costs to stabilize and to support basically the profitability in our P&L. In the first half year, you remember we had a EUR 26 million contribution. And now only in quarter 3, cost management initiatives contributed with around about EUR 23 million, which brings us to the EUR 49 million, which we announced for the first 9 months. And we expect around about EUR 20 million for the last 3 months of this year. That brings me to the balance sheet, to the leverage numbers, to liquidity, basically, to cash management. And I think here it is important, as Heimo mentioned, we will manage down working capital to the range of around about 20% in relation to revenues. This means the roundabout a little bit higher amount, basically. Almost EUR 400 million basically is coming in from the working capital management. And a net amount of EUR 300 million, as it is mentioned here, arrives then in the net debt. So we will bring down production output on the one side to have normalized inventory levels for beginning of 2024; on the other side also, to have a normalized working capital. As we said, we should be at around about 20% at year-end. So that means we confirm once more our financial KPIs, meaning that net debt, by the end of the year, will be below EUR 1.1 billion, that the financial leverage will be below 1.5x and working capital in the range of 20% for the end of 2023. Handing back to Heimo, and Heimo will talk about what we expect for the rest of the next 3 months.

Ladies and gentlemen, yes, we talked extensively during this year about our end markets. And you have seen that, obviously, we kept our expectations at the level we have recently discussed about at our Capital Markets Day. So Europe in the new build sector, on average, down by about 35% and 20% in the U.S. What we see when you look throughout the markets that some of the Eastern European countries, big ones like Poland, the Czech Republic, and also some Eastern Southern states, meaning the Balkans, have reached a little bit their bottom. We've seen some more activity already in the third quarter, also backed by some initiatives that local governments have taken in this area. So mortgage rates, however, remain high. Inflation is also on certainly pretty high level compared to the past. But as I said, some stabilization in Eastern Europe. Western Europe, as I said already during half year result call and during Capital Markets Day, you will see a downward trend for the rest of the year because it needs to adjust, and this is a logical development because it comes a little later, but nothing to be preoccupied with. I think we are then going into next year with around those levels that we have indicated to you. In the U.S., you see also that the market is coming down a little bit. I would say that the high mortgage rates was about 8%, were spiked a little bit now in the market, and project developers and especially the big homebuilders are not building so much anymore. But as I said, this is already built into our expectations for this year, and I'm not seeing here major changes going into the first couple of months of next year. Renovation is, as I said, from perspective of roofing, very important for Wienerberger, also important when you talk about piping division. So here, I would say what we see now that renovation is, in certain countries, picking up due to also governmental interventions in the sense of interest rates or tax breaks in certain areas. We need to see strong momentum still coming through from countries like Germany where there's nothing done yet and France where there are some things discussed to give here a sort of better guidance for next year. But for the rest of the year, it will stay around these levels. Infrastructure has certainly considerably picked up both in the U.S. and Europe, and we see this in the trend, as I said earlier, in quarter 3 and this will go into quarter 4 as well. So all in all, as discussed, expected markets continue for the rest of the year. If we summarize our different major drivers for the rest of the year, you have seen a strong contribution coming from cost management. Here, as I said, very quick, very fast implementations throughout the Wienerberger Group. All in all, we will have about contribution of around EUR 70 million. Fixed cost reduction, here, we are working on that, and I'm confident that we will reach this. We have, obviously, also on the CapEx side, I will show you a slide in a minute when we talk about CapEx reduction, we adjusted, obviously, because we are running with less capacity utilization, so about EUR 30 million less CapEx compared to the ones that we have guided for this year. And we will keep our price over cost outperformance in the range of about 4% to 5% for the whole group for the whole year. And the self-help program also very satisfactory, good contribution, and you will see another inflow of about EUR 11 million in the fourth quarter. So that we will reach the overall performance and the guided performance of this whole program, EUR 135 million for this. I can also say that Gerhard and myself are working on putting something together for the future. This will continue. This is part of our business, optimizing it, and we are investing in the business. So you will have here a clear guidance also with respect to self-help programs in the future. I talked about the CapEx. You see that we're bringing it down from EUR 140 million, the maintenance one to EUR 125 million for this year. This is due to the asset base that is less utilized, obviously. And you see also how quick and fast we are here in order to monitor very well the spending part, and the special CapEx comes down to about EUR 150 million for the whole year. So about EUR 30 million CapEx cut for the whole year. When we look at Wienerberger's performance, I just want to put in perspective the year 2023, again, and the overall performance, you're seeing very clearly, ladies and gentlemen, this is actually the second best year in the whole history of the company compared to last year, which was extraordinary. We will reach our EUR 800 million to EUR 820 million EBITDA for this year. So it puts us, obviously, in a very strong position as far as cash flow is concerned, cash conversion is concerned and overall performance. Because you see here, with the indication of the market trend, how deep the market actually drops, our end markets drop, in '23. And our performance stays at a very good level. So here, you see that focusing on innovation, on systems and a strong ESG footprint that we deliver pays off at the end of the day and leads to a very strong result this year. So when we look at the fourth quarter in detail, so that we have no misunderstanding here, we are now at EUR 665 million at the end of the third quarter, Gerhard has explained it. We foresee EUR 135 million to EUR 155 million EBITDA in the last quarter. For those who follow us very closely and might say this is not enough or why is it only this number, it is, ladies and gentlemen, because we clearly said we put emphasis on working capital management and are deliberately managing our inventory level down. You have heard from Gerhard, it's about EUR 300 million reduction in net debt that we will achieve until the year-end. It means basically that we go on extended and earlier winter standstills in our production, especially on the brick side, meaning on the Continental European clay block and facing brick activities. So this will lead obviously to a lower profitability in the fourth quarter because we have less capacity utilization. So this is the explanation and has obviously a major impact on the balance sheet with the less EUR 300 million net debt at the year-end. So this is a deliberate choice from us in order to manage debt down. So this is the overall sort of explanation for the quarter 3 and the outlook, I think we are in a very good shape. I look positively to this year, as I said. Very good performance from Wienerberger, considering the development of the end markets. And Gerhard and myself are now ready to talk with you and answer your questions. Thank you very much for your attention. Operator?

[Operator Instructions] The first question comes from the line of Brijesh Siya from HSBC.

Two questions from me. To start with on the end market, you have fully pointed out there's some green shoots happening in Eastern Europe. But Western Europe remains weak. Standing here and looking into next year, you see that the end markets are clearly not showing any signs of improvement, especially the biggest market in residential, and expectation that the mortgage rate is to remain high. In that scenario, how confident are you for next year kind of in terms of pricing assumption, which you are pointing towards a 2% to 3% increase next year? So have you kind of contacted with your customers or any early signs of how you're feeling about next year pricing? Then second one...

Let me just answer this one first. I think it's a very important one, and I thank you very much for this one because it's a critical one. I think what we have here is a very particular situation. And I talk on behalf of Europe and North America. In all our end markets, we have a very, very strong demand for housing. So people are actually waiting for housing, for new residential housing, for apartments, for houses, et cetera, and want to invest. So really, I don't call it a pent-up demand. It's a structural undersupply that we have in all these markets. There is, however, one big element. It's the access to financing, and it's obviously the rather high mortgage rates. If you see that the Polish government or the Polish state, let's put it this way, is moving in direction to provide first-time house buyers or apartment or young generations in the sense of cheaper loans or granting them benefits for this, you see that people move quickly. So just to address this very openly to you, when we see certain initiatives that have to be taken by states, governmental institutions, whoever, the market will move rather quickly and dramatically in the positive side. So this is something that's a very particular and interesting situation. So you understand that, from our perspective, running the company and managing, you need to be very flexible because demand levels might shoot up rather quickly in some of the end markets. So we need to prepare, on the one side, fixed costs to manage them very thoroughly; on the other hand, have the capacity ready when it comes. So yes, there is good demand, very strong actually demand levels, depending on how the financial environment is moving next year. So this is the key issue. If interest rates show tendencies to come down, obviously, we will see a strong shift in the marketplace. So that's what I'm trying to say. And that's the only thing to look at right now because there is this strong demand one. So there's no structural oversupply, nothing. So it's really focusing on the financing part when you talk about housing. Your second question was about pricing. And this is, I think, also an important aspect. You need to see Wienerberger through the last couple of years, how we have changed business model, how we have changed our product portfolio, how we position ourselves in the market. It's nothing to do with the commodity supplier in the past. We are proposing, as I said, solutions. We're also proposing whole systems, and therefore, the pricing is a stronger and better one. So overall, I'm optimistic that this pricing, with this one, we go through into 2024 from the '23 level, yes.

Okay. The second one, from my side, you talked about adjusting capacities to cater to the current demand situation. But as you said just now that there could be green shoots coming and it could be much weaker, you could see a strong demand coming in. So in that scenario, what would be your approach given that you are cutting so much and that's due in Q4? Then going into next year, will you be undersupplied if the demand starts picking up? And within that, Gerhard, if you could help us kind of understand what's the kind of cost to achieve those cost savings of EUR 70 million? I think H1 was EUR 5 million. And will there be any additional cost to restart those plants when you go to the next year?

On the cost side, I will leave it to Gerhard in a second. There won't be any additional cost to start. This is normal procedure, by the way, when we start these factories. What we are doing right now is a very normal thing. You bring down capacities, meaning plants from a capacity perspective, where you shut them down for winter standstills. The winter months is the most expensive time to produce because it's cold weather, clay preparation is somehow difficult, it's wet, et cetera. So it's a logical step. By the way, this is used to be always the case in our industry. You do maintenance, people take their vacation, et cetera. So that's what we will do on an extended level. So we started a little earlier than usual. To your point, are we undersupplied? No, we are not. We have very good stock levels. We have filled them up. We said during this year, after last year 2022 when we were sold out, we needed to put up some stock. That's what we did. And we are now on a very healthy level. And in some countries, we think that it is enough and keeps us busy for the next building season for the beginning. So we can actually go comfortably in it. If the pickup, or if you're correct when you point to the fact that it might come up, we are ready to start immediately, so we will be able to supply.

Tell me once more with your question, especially on the cost side. What was the...

Well, I was looking for how much of the cost you're spending to achieve the EUR 70 million of cost saving? I think you told us EUR 5 million at H1. So if you could give us for the full year.

The cost for restructuring, this is what I understand.

Yes.

In first half year, we had around about EUR 5 million. I expect that we will see another EUR 10 million in the last quarter. We're basically constantly evaluating our plant network and also depending on how markets are developing. End markets, we also decide where we take out capacity or where we leave capacity in. At the moment, as we tried to explain, this is more in the sense of kind of a winter standstill where we bring down capacity for working capital management. By the way, this is something what we do normally or what we did all the years back, and that was an exceptional year in 2021. But all the years back we had winter standstills also to manage the working capital on a level to start up again in 2024 in a normalized way. So out of these working capital -- or let's say out of the standstills, what we have due to working capital, there are no one-offs, what you have to expect. So when we speak basically about structural adjustments, meaning that we really take out capacity for at least 12 to 24 months. Then we would show it basically as a kind of a one-off, basically a separate position between operating EBITDA and reported EBITDA. And as mentioned, at half year, this was around about the EUR 5 million, and I expect an additional EUR 10 million. And this is what you can foresee for the whole year 2023.

The next question comes from the line of Gregor Kuglitsch with UBS.

So just a few, please. I think you mentioned some volume data, but could you just actually tell us for maybe quarter 3 the volume effect and ideally also price for the 3 segments, that would be helpful. And then I think on the last call back in August, you were saying that you sort of had a EUR 50 million restocking benefit, if you want, in half 1, and that's unwinding in half 2. I want to understand if that's basically unchanged from then, and then I guess how much of that actually is basically going to drop into quarter 4. And then I think the final question, on the Capital Markets Day, I think you gave some outlook on cost increases next year. So if you care to comment where your hedging position is for next year. I think you don't put that in the slides anymore, but if you just give us a bit of a sense where the hedging position is. And I think the math was like you needed a maybe 2%, 3% price increase to be sort of price cost neutral for next year, if that's still accurate. I just wanted to double-check.

If I may take up your last one, yes, you're absolutely spot-on with the 2% and 3%. We are well covered with respect to the energy and the other things. Obviously, cost inflation will come down significantly in big chunks of the business. But I would say about 4% cost inflation, yes, that we need to cover. So your 2% to max 3% is absolutely spot-on the pricing. Yes, from the working capital and inventory side, most will come in the fourth quarter. Gerhard?

Basically, we started already in quarter 3, but I think as you were mentioning, basically the EUR 50 million, what we mentioned also with half year announcements, we took a first part in quarter 3 and the rest around about EUR 20 million to EUR 30 million will come in quarter 4.

Okay. The volume and price?

Volume and price, basically, I thought I mentioned it. In quarter 3, we have a minus in volume of minus 17%, the price up by plus 5%. And this is what you see basically across Europe, this trend. And you see in North America a little bit less or basically a less decline in volume, we are there at around about minus 10% and price in quarter 3 of plus 3%.

The next question comes from the line of Axel Stasse with Morgan Stanley.

I had two. I just wanted to understand, so price was up 12% in first half year this year, 15% in Q1, and now I think it's 10% in the 9 first months. Is this linked because of regions' mix effect? Or is it your piping end market that is growing quicker than expected? Can you maybe give a bit more flavor on this? And then the second question was about low energy prices versus last year. Have you seen any maybe small independent bricks players cutting their prices and then giving back the cost deflation in some markets and therefore, putting pressure on prices?

To your second question, as I've said already at the Capital Markets Day, we cover a lot of territory in North America and in Europe. Obviously, with the smaller, or I call them with our competitors in local markets, you see all sorts of developments because they have 1 site or maximum 2 sites, so they do certain things. But on the other side, it doesn't lead to price wars or major price erosion. So it's more of a stability. And keep in mind that it's not only energy that hits them as well. They have also wage increases, also dramatic ones, and other increases cost-wise. So it's not that they have such great flexibility to trade down with the prices. And also, the landscape of the industry has changed dramatically over the last 10 years. The important part of this, price competition-related producers that were only focusing on pricing has already left the industry for good. So I think we have now strong local competitors that focus also on better quality and on high-priced products. So this is essentially to your second question, and the first one was related obviously to Gerhard.

I think what you mentioned is right. You said the first half year was plus 12%. We are now at plus 10%. And it was even in the first quarter, basically, the pricing was even up by plus 15%. We already announced at that time that this is more flat now as we are, this year, on the ceramic side, we keep our prices up. So we keep the price increases, what we announced in the beginning of the year, we keep on that level and run through the whole year 2023. We had last year, on the ceramic side, also during the year, the one or the other price increase. So that means also you see, on a year-on-year comparison, that the percentage is basically shifting. That's about the ceramic business. And on the piping business, please keep in mind that we have seen, on the piping side last year in the third quarter, basically, the peak on the pricing. This was also the peak of the pricing of granulates. And we also have seen during the last, let's say, around about 9 to 12 months that the grain prices, the raw material prices, are slightly coming down. And that means also that we adjusted slightly our prices with a certain delay but also by keeping the margin stable. But this is also where we see that basically the average price of the group is influenced by basically the development of the piping business.

The next question comes from the line of Tobias Woerner with Stifel Europe.

Two, if I may, from my side. And I'm not sure whether they were asked because I came on to the call later, so apologies in advance. Firstly, when I look through your presentation, you didn't give the customary cost inflation number. In the first half, it was 8% where you were. Can you just update us on that and just give us a sense of what the wage inflation is in percentage term now for you? And then also the energy piece and how much of the energy piece you're still hedged by, I'm not sure whether that was in the presentation either, but apologies again if it was. The second question relates to volumes. You gave us an indication to the group volumes and prices. You are saying Western Europe is getting worse in Q3. Can you just give us a sense of where that comes from, which sector and which countries that relates to?

Yes. For the first one, we didn't say it gets worse, it's as expected. I would say that the volumes are developing and we were talking about Western Europe. Here, it's obviously Germany that's the most important one that drives the downward trend, but that's obviously key to everybody that the German real estate and new residential renovation markets are significantly down. So this just a confirmation from the trend that we have seen, nothing worthy. And on the other one, on the price side, what I understood from your question is inflation has come down, obviously, from the first half of the year.

Right. We had, as you said, in the first half, announced an inflation of around about 8%. And as we said, first, we are also fighting against the inflation, our consumed inflation. And secondly, we also see that the granulate prices, as I just explained before, are also coming down, yes. So that means that after the first 9 months, cost inflation is around about 6%, and I expect for the whole year, a cost inflation even below, let's say somewhere between 5% to 6%.

And this includes wage inflation.

This includes wage inflation, yes.

For us, yes. So '23 is covered by this. Energy has been fully hedged, I mean what we can hedge for this year. So this is also included in this sort of inflation.

Okay. But has the level of hedge gone down or stayed the same for next year? Where are we with regards to the energy hedge?

Basically, we are fully hedged for next year. We are on a level of around about 90% for next year in hedge.

Okay. And if I may just follow up. If you say price inflation rolling 9 months is at 6%, ended up at 5% or 4%. If you take the price/cost that you mentioned earlier, 4% to 5%, then we should assume that pricing on average, across the whole of 2023, should have been somewhere around 8% to 9%. Is that fair? Is that correct?

As you said, 8% for the whole year. This is what we expect on pricing on a year-on-year comparison for the full year 2023.

Ladies and gentlemen, there are no further questions at this time. I will hand over back to Wienerberger for any closing remarks.

Thank you, operator. Ladies and gentlemen, thank you very much for taking the time and dialing in today. Our next conference call will be held on the 21st of February, 2024, where we will release our full year results for 2023. For today, I wish you a pleasant afternoon, and goodbye.