Claus Zemke: A wonderful good morning, ladies and gentlemen, dear colleagues, cordial welcome on the occasion of our press conference for the second quarter. My name is Claus Zemke, and I would like to send you the most cordial greetings from LANXESS Tower in Cologne during the holiday season. With us is CEO, Matthias Zachert; and Oliver Stratmann, our CFO. Both of them will give you a compact overview over the results of the second quarter and the outlook on the full year results, and they will also be available to answer your questions on the strategic development of LANXESS. Let me make a couple of technical remarks. This conference call is conducted in German, but simultaneously interpreted into English, and you will have the opportunity to ask questions, and there will be some technical comments that I will be giving you later on. And this entire conference and your questions will be recorded. So let me give the floor to our CEO, Matthias Zachert.
Matthias Zachert: Cordial welcome also from me on the second quarter 2026 results of LANXESS. I'm on Slide 3, and I would like to start with the overview of the second quarter. And we can say without much ado that as compared to the first quarter, we can see a very positive momentum as compared to the first quarter. Sales and earnings increased, and we also had a positive demand effect attributable to the Middle East conflict. But price-wise, we also made some gains. On the basis of the second quarter, we can also confirm the guidance for the full year 2026. Slide 4. And here, we are looking at sales and EBITDA. As compared to the previous year, we were able to clearly increase sales by 6 percentage points, and this is attributable to positive volume effects and price effects. We were able to increase prices by 3%. EBITDA only increased moderately, but that's also due to the fact that in the previous year, we had positive one-off effects. And in the second quarter 2026, we have our EBITDA based on purely operative results. Next slide. Price and volume rise shows you that the past 12 months, starting with the second quarter 2025 when the tariffs started to escalate, then prices and volumes in our industry as well as with LANXESS developed very slowly. The momentum picked up in the first quarter slightly. And in the second quarter, you can see that sequentially speaking, price-wise, we were able to make gains and the same is true for volumes. So in both areas, price and volume, we saw clear progress. And you can also see that when looking at Slide 6, where you will see the sequential development of sales and EBITDA. It was already middle of May that we were able to communicate when talking about the first quarter, which was still quite a weak one. We had forecast some pickups in the second quarter, and I'm happy to be able to confirm this. Sales increased by 13% sequentially speaking. EBITDA substantially increased. We are at the top, even above the guidance that we published on the second quarter, I think 62% speaks volumes. Free cash flow. And we are happy to say that in the second quarter, we have a clearly positive free cash flow result. Normally, the first 2 quarters are more moderate, if not negative. And then there is a turnaround normally in Q3 and Q4. But here, we already see some clear improvements in the second quarter. Let us now turn to Slide 7, which gives us a sequential development across the segments. In all the 3 segments, we can report positive results, both in sales and EBITDA. Let's now talk about a topic which I'm sorry to say hits North Rhine-Westphalia particularly hard, especially when looking at the industrial companies, and there is a really need for action. It's the low Rhine water level. And I think it was in 2018 that we were facing a very similar situation, but now we really have to say quite clearly that the present situation is much worse than what it used to be like in the old times when we had low Rhine water levels. We can only load the ships and the barges by 20% to 30% of their normal capacity, which means that we have a clear reduction of absolute cargo capacity per barge. And we also see the situation that some of the loading and unloading points can no longer be used because they're no longer accessible. And we actually took measures at an early stage. And 5 weeks ago, we established a crisis team, which is in daily contact with the main functions in the businesses, procurement, suppliers and logistics partners, which is why we were in the lucky situation that many of the transports were shipped and could be shifted to rail and road. And this means that our production is not impacted. And also some investments we made over the past couple of years paid off. We had many operations that could only be supplied by waterways. We actually shifted them so that they can also receive their supplies on the waterways, but also by road. So this gives us clearly more flexibility than what we saw in 2018, 2019.
Oliver Stratmann: Let me now talk about the outlook. And you as journalists come up with comments on the economic situation day in, day out. So the economic environment remains tense and the difficulties are ongoing that we have experienced for quite some time. Also when it comes to exchange rates, we must say that sometimes we are negatively impacted by foreign exchange rates. So the dollar is weaker, which, of course, is not exactly advantageous for a company like ours that are dependent on exporting. And we don't really see any economic impulses or pickup second half 2026 on the basis of the investment stimulus package of the German government. I mean this might change, but probably not this year. Having said that, we can confirm the guidance for 2026 full year. The foundation is a strong one, and we proceed on the assumption that the third quarter will give us good results in comparison to the previous year quarter, even if it is not as pronounced as we had thought and in comparison to the second quarter, but we are still talking about EUR 130 million to EUR 150 million. And of course, we have to be very diligent when it comes to cost savings. We must save and we also think that the antidumping measures on the European Union side will help the German chemical industry. We need that protection against dumping exports as we see them coming from Asia. So ladies and gentlemen, this is a brief overview of the second quarter. And now we will give you the floor to ask questions.
Claus Zemke: [Operator Instructions] And the first is Annette Becker, Börsen-Zeitung. Can you hear us?
Annette Becker: Yes, I do. Two questions. low Rhine water levels. You said up to now, you managed the situation well, but it will increase costs, won't it? And what about the more distant future because we cannot really expect any rainfall in the next 2 to 3 weeks? And a technical question, during the first half, of the year, did you have correct the valuation of Envalior? And if so, to what extent?
Matthias Zachert: Thank you very much, Ms. Becker, for your questions. First of all, costs in the context of low Rhine water levels, this is a single-digit million amount of money. But of course, we have to wait and see for how long this is going to persist. But production shutdown is the real challenge. So far, we have been able to maintain the supply chains intact. So no losses here, no relevant production interruptions. When it comes to costs, we can manage that, but if there was a volume failure, it was more serious. And we do take the problem seriously, and we have also reported about it during this press conference call. Now let me talk about the second question you have asked. And we don't believe that the situation is going to change over the next 1 or 2 weeks. But all the volumes on the procurement side have been covered and hedged. And well, we have to wait and see how long this is to persist. And then on Envalior, Oliver Stratmann, please take over.
Oliver Stratmann: Good morning, Ms. Becker from my side. In the accounting, Envalior is considered an at-equity investment. So in our P&L, we take the net amount, which is negative in this month. This is referred to Envalior and this then is the reduction of the balance sheet when it comes to the value of Envalior. So there is no depreciation or anything like that, but only the normal reflection of the business.
Annette Becker: Can I have a follow-up question, please? If I understand matters correctly, the most critical item is the supply with the raw materials of your own plants?
Matthias Zachert: Yes, of course. We need raw materials in order to be able to produce in the first place. And if we don't get supplies via barge or boat, need to be received via road and rail and the teams are working on it full steam ahead. And for the next 1 or 2 weeks, this is all in a safe place. But of course, we will have to wait and see for how long this situation is to persist.
Annette Becker: And the supply of your customers is not done through barge supply or boat or ship supply?
Matthias Zachert: Well, yes, we also use boats. But in this respect, rail and road is the preferred mode of transport.
Annette Becker: When it comes to rail, is there any restricted rail capacity because you are not the only one that will have to use the railway?
Matthias Zachert: Quite right. But fortunately, we started early to safeguard capacities on the German railroads and took the respective decisions early. But at the same time, we understand that the Bundesbahn really tries to make available capacities, increase capacities. And yesterday, there was the Transport Summit. So our new Transport Secretary organized this meeting yesterday in order to discuss the challenges. And of course, they also discussed how to expand road and rail capacities. This is something we certainly welcome, but things, of course, need to be implemented at the same time, and this is a sine qua non.
Annette Becker: Okay. This deals with the low water level problems?
Unknown Executive: Question answered. Yes.
Claus Zemke: Bert Fröndhoff, Handelsblatt. Over to you.
Bert-Friedrich Fröndhoff: Two questions. You have mentioned 2 advantages because of the war in Iran. I mean the entire industry is benefiting for this. How long is this to proceed? And are all the inventories stocked up? Is there a wait-and-see situation amongst your customers? So how do you think this is going to pan out? Second question, I mean, the industry has got less pressure from Asia because of the consequences of the war in Iran. So once they have done with the problems in Iran, do you think that you will go back to the status before the pickup of the war?
Matthias Zachert: Thank you for your questions. I mean nobody knows how long this situation is going to continue in the Middle East. At the end of the day, this is all dependent on individual people and their decisions. This is beyond our control. Therefore, we have to take the situation as it is and handle the challenges as best as we can. On the customer side, we have not seen any dramatic stocking up. In the beginning, during the first 2 to 4 weeks, we observed higher volumes being ordered, but this was not a fundamental impact. For the second quarter, we saw positive volume effects, but we could not really say that the customers stocked up come hell or high water. And customers were very mindful not to order too much because prices went up significantly and customers didn't want to stock up at these high costs. And therefore, we can't really see that we are confronted with a situation where a massive destocking would happen over the next 2 quarters or so. And we don't expect that for the third quarter either. So we see just normal seasonal performances and certainly not that there is no demand on the customer side. Second, competitive pressure. I mean, after tariff escalation, competitive pressure was very significant here in Europe, but the escalation has petered out a little bit, and we have seen that flows of products from Asia to America were diverted to Europe, but not in full. So Middle East is not the only topic, but also normalization, if I can call it, that in comparison to the similar quarter in 2024 and 2025. Chinese competition is here to stay, but the intensity as we saw it in 2025 is not going to repeat, we feel.
Claus Zemke: Thank you very much. The next question goes to Patricia Weiss from Reuters.
Patricia Weiss: Part of my questions have already been asked, but let me ask again, and please bear with me to also come back to the low water level of the Rhine because this is a dominating topic. You said that so far, there are no major production reductions. But where were you specifically affected? Were there some restrictions in production already? And you said that you are fairly safe for the coming 1 to 2 weeks, and you are optimistic. But as of when will the situation become really critical so much on the Rhine water level? And then you spoke about the clearly positive momentum in the second quarter. So altogether, if you compare yourself with the industry with LANXESS, it was still a little moderate, and you also talked about the outlook, whereas other chemical companies were able to raise their guidance. So what kept you back from adjusting your [indiscernible]? And what about the savings and then the reduction of workforce? And then are there possible closures of further plants? So much on my questions.
Matthias Zachert: Thank you, Ms. Weiss, for your questions. Let me answer the first one. As I said, looking at the relevant operations in North Rhine-Westphalia, the production was upheld. We are happy about that. And we have a minor operation in phthalic acid anhydride, but it's a minor operation. So it's not really having a major effect. So the major operations that we need to keep our results on a stable level, if not even to increase them as compared to the previous year were up and running. And let me repeat that we take it that in the coming 1 to 2 weeks, the situation will not change. And we are in close cooperation with suppliers and logistics companies, and we take it that all plants operations will remain in operation. Looking beyond that, of course, we will keep an eye on the situation. And already now, we are working on looking at the supplies for the next 4 to 6 weeks, but we have to readjust to the situation on a daily level. On the cost position, I can only say that we continuously look at our cost items and the global economic situation. Once global economy should deteriorate and demand drop considerably, we will have to look at cost time and again, but the closures we have already communicated are the ones of which we think that they will be necessary and the rest of it will have to be addressed should the need arise. The second point, could you specify that?
Patricia Weiss: With pleasure. That was the second quarter. You spoke about the clearly positive momentum. And of course, we also saw the clear increase as compared to the first quarter. But when looking at that, you are rather hesitant or moderate as compared to your competitors who actually raised their guidance. So the question is, what was the headwind on your side so that you couldn't raise your guidance and that you didn't benefit as much as other companies?
Matthias Zachert: I think when we communicated on the first quarter in May, we were already rather ambitious when guiding the second quarter, and we said an increase of 50% plus. That's what we reckoned with and communicated accordingly. So the peers actually, we were -- as compared to the peers, we are rather bullish for the second quarter, and we had some price increases and the capital market appreciated this. Now we actually delivered very properly because at an early point in time, we already communicated in an ambitious way. So we are not going to make any readjustments. And for the coming quarters, we are going to continue to deliver. I hope that answers your question.
Claus Zemke: All right. The next question is Jonas Jansen from FAZ.
Jonas Jansen: I think you've answered most of it, but one question. Do you have a comparator for the costs that you incurred in 2018 when you weren't so well prepared for BASF, I remember that it was about EUR 250 million because they also had to suffer with production. Do you have any comparator?
Matthias Zachert: Luckily, we didn't have any production disruptions or shortage or stop of production. Production-wise, we actually fared well through this low water level phase, but the additional costs, logistically speaking, were in the single-digit million range. And the investment we made ever since are in the upper single-digit million range and so much on the comparison between now and 2018.
Claus Zemke: Thank you, Jonas. Next question goes to Ms. Stella from Wall Street Journal. Ms. Stella, can you hear us? We can't hear you. Now we can hear you. Wonderful.
Unknown Attendee: On the low water level, with another company I asked yesterday, they said that this was negligible for them. How much is transported by waterways, be it the river Rhine or other waterways? And it's not supplying but receiving that interests me.
Matthias Zachert: Well, it's the supplies for our production. So this is delivery to our sites. I can give you the kilotons. We are shipping in North Rhine-Westphalia about 400 kilotons per annum. In absolute terms, I would have to look it up percentage-wise, and I would have to look it up. But absolutely speaking, this is clearly of relevance. Talking about the different comments of other companies, let me say the following. Companies further south in Germany have a different water level situation as compared to those here more up north. And the further north, the less relevant the topic is. So that is why you have to differentiate the comments.
Unknown Attendee: Well, actually, this was a company that's not so far removed from yours. But order of magnitude, if you could let us have the percentage at a later time, how soon can you switch to road or rail? It's rather difficult right now?
Matthias Zachert: Well, we can manage, but that's also due to the fact that you have to be really early and look at the topic and secure capacities. We were lucky to have done that. And that is not a walk in the park at all. As I said, we are looking at the situation in a daily fashion and Board of Management is getting information every day, and we discuss the situations and try to find out what else we could do to master the situation. This is something that really makes use of the entire organization.
Claus Zemke: Thank you, Ms. Stella. So there are no more persons asking for the floor. So could we say thank you for joining this press call. Enjoy the summer, and let's hope for some rain. Goodbye. [Statements in English on this transcript were spoken by an interpreter present on the live call.]