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Operator: Ladies and gentlemen, welcome to the SGL Carbon 9 Months Results 2025 Conference Call. I am Moira, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Claudia Kellert. Please go ahead.
Claudia Kellert: Yes. Thank you. Yes, a very warm welcome, and thanks for your interest to our conference call today. Andreas Klein and Thomas Dippold will present our 9 months figures, inform you about our -- the status of our carbon fiber restructuring and give you some more insights about our expectations for the upcoming months. After the presentation, we look forward to answering your questions. But let's start with the financials. I hand over to Thomas Dippold.
Thomas Dippold: Thank you, Claudia. Hello also from my side. This is Thomas Dippold. I'm happy to guide you through the performance of our 9 months figures, and I jump directly to the overview of our group performance on Slide #5. We have reached after 9 months 2025, EUR 653 million in sales in our top line, which is 16.5% lower than last year at a 9-month time frame. And in the end, we lose EUR 130 million. This is quite remarkable, and this -- there are 2 effects behind it. On the one hand side, there is a continuous weakness in our demand from semiconductors. And the second is that we restructure our carbon fiber business unit and therefore, also lose some unprofitable sales and both effects, together with the cost savings and cost measures that we have undertaken level more or less out. And you can see that also in our EBITDApre on the same slide. We have reached EUR 108.6 million in the first 9 months of 2025, which is roughly 15% less than last year. And as you can see, our profitability despite the impact from our high-margin silicon carbide business, which goes down so massively, and we see that on the next slide, we still can manage it on this level that we -- that our EBITDA goes down not proportionally as the sales, but even lower. And therefore, our EBITDApre margin even slightly increases to 16.6% compared to 16.3% after the first 3 quarters of last year. I think that's a quite remarkable achievement that we see here. On the one hand side, how we manage the restructuring of our carbon fiber side. We are -- I'm very happy with the progress that we did there after such a few couple of months that we are conducting this. We closed down more or less 2 sites. Lavradio site is more or less closed. Moses Lake site in the U.S. is idled and we stopped production there and therefore, adjusted the workforce quite massively. And with these effects, together with the overall cost savings that we put in place, we are able to manage the downturn in the silicon carbide business, which is a business where the margin exceeds the cost quite significantly. And therefore, it's hard to compensate on that, but we achieved that. And I also said here for the first time in this call, we confirm our guidance. I want to make this very clear that we have adjusted our top line sales previously this year, that we say, 10% to 15% lower than last year, but the EBITDApre will be in the range of EUR 130 million to EUR 150 million. This is what we can say today. I think the split of the sales, I mean, it is very much the same as in previous quarters. Graphite Solutions is still dominating our business by far. And this is also why the impact of this very profitable business hits us so far. Coming to the individual business units. You see on Slide #6, the performance of Graphite Solutions. And here exactly the impact that we're all talking about. We have a 21% drop in our sales after the first 3 quarters of the relevant years compared to last year, now reaching only EUR 325.7 million sales in this business unit. And the downturn, the impact of EUR 87 million drop in the top line can be almost exclusively contributed to the downturn of our business line, semiconductor and LED. You see it here in the comments, EUR 77 million is the downturn in this business line, almost a drop by 40%. This gets compensated because the other businesses are rather stable that the overall impact is then just roughly 20%. But thanks to the high profitability in this business, our EBITDApre gets hit by 44%, now reaching EUR 58.2 million, which is a drop by EUR 46 million, and this shows how profitable this business are and how dependent we can say we are profit-wise on that. We will come to that and the development. Andreas will elaborate a little bit. But our EBITDApre margin dropped from 25% to now 18%.
Andreas Klein: Yes. Good afternoon also from my side. Thomas has commented already on the EUR 77 million year-on-year drop in our core segments, semi and LED. This is in line with the development we have seen in the first half already, and it's also in line with our expectations of around 2-year slowdown of that business. However, we remain confident that the market is set to recover after this dip. First of all, the underlying battery electric vehicle sales and demand is back strong. Second, we see the inventory management along the chain happening. And third, last but not least, the silicon carbide is set as the semiconductor material of choice in e-mobility. So semiconductor sales are set to recover from our perspective. Back to you, Thomas.
Thomas Dippold: Thank you. I'm -- I continue with the development of Process Tech on Slide #8. Process Tech remains rather stable in the top line despite the market, chemical industries, especially in Europe is still in a continuous trouble. But Process Tech managed, thanks to the international or even global setup that we have that we can balance our portfolio with the United States, with the Americas, but also with the Asian sites that we managed to keep our sales on the level that we've seen also last year. We have reached EUR 102.4 million in the top line, and this is just a decline by 3% compared to last year. We still live very much from the strong order book how we started into the year and all this very attractive large-scale projects really contributed also margin-wise to this development. We now see a little bit declining order book as we entered into Q3, and this will continue also a little bit in Q4. And we see also a continuous price pressure when new projects get awarded. So the continuation of this very strong performance that we see after 9 months in this year will potentially get a little bit eroded by end of the year. But so far in this year, we have reached EUR 28 million EBITDApre, which is a 9.4% increase compared to last year. Despite the sales stay rather on the same level, I think that's a remarkable performance that our Process Tech colleagues achieved here, and we are very grateful for that. And the margin reached now 27.3% in this business. I think that's a very strong performance, and we are very happy about that. Coming to Carbon Fiber, which is another -- yes, good result. And you might wonder why I say that because sales dropped by 20% or EUR 32 million, now reaching EUR 125.7 million. And why do we still say this is a success because for the first time since 3 years, our Carbon Fiber business unit shows positive results on an operative level. And I think that's quite remarkable that we achieved that with the closure of 2 sites in Lavradio and the shutdown of the production in Moses Lake in the United States. We managed to have a very quick turnaround in our performance there. And when you look at the EBITDApre compared last year at the same point of time, we reached after 9 months, minus EUR 8 million. And today, we can show EUR 9.5 million. As you remember, there's always a split because we also show our proportional net result of our BSCCB JV in the result of Carbon Fiber. Last year, the JV impact was EUR 11.7 million. So the operative loss was even higher by almost EUR 20 million then. This time, it's only -- this is attributable to the, yes, weak business of BSCCB at the moment. At the moment, the impact is EUR 5.5 million. And I mean, you can do the math in the end, the operative performance of Carbon Fiber then is plus EUR 4 million after 9 months this year. I think beginning of the year, if somebody had told me that we achieved that after 9 months, we all would have bet on that. I think it's a great, great achievement of the management there, and we are very grateful for that to achieve this turnaround and to continue with a profitable business as we have it. Last but not least, Composite Solutions. Yes, we also see a EUR 11 million or 11% decline in sales there as well, coming from EUR 95.8 million after 9 months last year, now reaching EUR 84.8 million this year. Why that? You probably remember in the first 3, 4 months of last year's performance, we still had this very profitable business within U.S., American SUV OEM, and this project got canceled at that point of time with a breakup fee. But then, of course, last year's figures still contain that at least for the first 3, 4 months of the year. On the one hand side, the sales, but also the bottom line, both are now out, and this is the reason for the decline, so to speak, in sales, but also EBITDApre. On the other hand, this also shows that it's very difficult to win new projects. And we did that only recently. I think we've won a couple of projects. But until they materialize into turnover and sales, this will be the second half of 2026 until they really materialize and impact also our profitability and bottom line. Our EBITDApre margin, thanks to the cost measures that we also do there, still reaches almost double-digit figure. It's 9.8%. And I think for automotive tier 1, there's nothing to hide with such a margin. But yes, you're right, the business declined and became small over there. Last but not least, on the next slide, I look at our bottom line in the P&L and also some cash and balance sheet figures. Our net result is massively negative as it has been already in -- at half year. We now reach after 9 months of 2025, a net result of minus EUR 50.3 million. This is mainly affected by the nonrecurring restructuring costs. We have about EUR 30 million, EUR 34 million of impairment in carbon fiber, where we impaired some inventory, but also the remaining assets in our Moses Lake site. I can tell you now there's really almost hardly anything left, which you can write off in our carbon fiber business. If you put the EUR 81 million restructuring cost on the minus EUR 51 million, then we would be on the level of last year with plus EUR 30 million. That shows that if you leak out the onetime effects, we have a positively contributing business that's despite the problems that we see in the market, contributing every quarter positive results. And you also can see it in the free cash flow. It's down EUR 3 million compared to last year. I think this is also a very strong performance after 9 months in this year to have a more or less stable cash flow despite all the restructuring efforts, which, of course, you can call pre, but in the end, they cost you some money and they are affecting the free cash flow. We managed to keep 3 positive quarters of free cash flow in 2025, and we are proud on that. And despite all the restructuring efforts and all the costs involved, our equity ratio still is around 40% with 39.7%. I think that clearly shows the resilience and the very strong balance sheet that SGL has. Our leverage ratio is at 0.8. The ROCE that we still achieved is 9.7%. I think given the circumstances that we face, we are very happy with our performance and our development here. And with that, I hand over to Andreas, who will guide you through the next chapter.
Andreas Klein: Thank you, Thomas. And in the second part of our call today, I would like to reflect on our activities in the 3 quarters 2025 so far and also on what is next in our journey. In order to counterbalance the structural challenges in our CF business as well as the market slowdowns around us, we have taken various measures this year, as already explained in previous calls. The first thing is the restructuring of the Carbon Fibers business. Of course, Thomas has described it, the exit from unprofitable business activities, especially in the areas of acrylic fibers and precursors, and that generated in total cost savings of EUR 25 million, and it enabled us to return to a positive EBITDA for that business. The second block is for SGL in total, the optimization of our headcount setup and implementation of really extensive group-wide cost reduction measures. And we are overall working on simplification of our processes and our corporate setup in order to reflect the smaller footprint we are in as a company now. Group-wide onetime effects totaled minus EUR 84.7 million. But as already described, the equity ratio remained high at almost 40%. That's quite an achievement from our perspective. In parallel to these 2 activity blocks, we have kicked off our corporate strategy process. We are looking at who SGL Carbon will be 5 years down the road in 2030, which businesses will remain, which businesses will be expanded and what are our new growth areas. So a lot of interesting things to look at. And the communication of this new corporate strategy is supposed to happen in the context of our 2025 results publication in March 2026. To give you a flavor for the direction we are thinking already today, I would like to give you some insights into 3 current development projects. The first block is new technologies for energy generation, where we have a great offer of various graphite grades for high-temperature reactors, which supply energy in a decentralized way close to where the energy demand is. And also, we have developed materials for energy storage systems that will help to shift to renewable energy sources. The second big block for our Graphite Solutions business is the research and development on new coating technologies. And we are currently in the market introduction for new metal coated materials, especially building on tantalum carbide as a technology. And by that, we hope to build up further growth fields. Last but not least, a third area of current development projects that the security and defense industry, obviously, quite a big topic at the moment. And our products basically in all the business units offer a wide range of great characteristics for these applications. For example, carbon composite components made with prepreg from our CS and CF businesses, which help to enable lightweight solutions like in the picture shown here to the right on that slide. Thermal insulation for high-performance needs is also a big topic for SGL, where we have great capabilities and that includes, for example, target industries like the space industry. So you see there's a lot to be excited about. And of course, we will keep you posted, especially in that strategy update end of the first quarter next year. Last but not least, for this call also from my side, underlining that we confirm our guidance 2025. Sales minus 10% to 15% lower than last year and the EBITDApre in the range of EUR 130 million to EUR 150 million. Thank you very much for your attention today.
Claudia Kellert: Now we start with questions.
Operator: [Operator Instructions] The first question comes from Thomas Deser from Union Investment, Frankfurt.
Thomas Deser: My question is about the investment plans of Infineon and others in the semiconductor industry in Germany. To what extent is that relevant for SGL?
Andreas Klein: Thanks for that question. Of course, not specifically commenting on particular companies, but yes, the investment activities in our region in Germany and Europe. This is, of course, important. There's a lot of momentum, a lot of new applications developing in EV, but also in data centers and the like. So that's a real megatrend for us as a company. But as far as we are concerned with our global setup and network, it's actually really a global demand we are serving. So for us, there's no particular location in particular focus. We are involved in the global semiconductor supply chains. And in that sense, for our sales, for our business, it does not matter whether investments happen in a specific country or not. I hope that answers your question.
Claudia Kellert: Okay. Then if we see no further questions, then thanks for your participation, and you can find the presentation on our web page. So if a question is upcoming, please call the Investor Relations team, Jürgen Reck and myself. Thanks a lot, and have a nice afternoon. Bye-bye.
Operator: Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines.