Earnings call transcript: Alchimp Group AG Q4 2024 shows mixed results

Alchimp Group AG, with a market capitalization of $5.28 billion, reported its Q4 2024 earnings, showcasing a mixed performance with an EPS of $1.09, surpassing the forecast of $1.04, while revenue fell short at $301.77 million against the expected $309.37 million. Despite the revenue miss, the company’s stock saw a 2.1% increase post-earnings, closing at $34.1, and continued to rise to $34.95 in aftermarket trading, reflecting a 1.66% gain. InvestingPro data reveals that 2 analysts have recently revised their earnings expectations upward for the upcoming period.

Key Takeaways

• Alchimp Group AG achieved the highest sales in its history, reaching €554 million in 2024.
• EPS exceeded expectations, but revenue fell short, leading to a mixed market reaction.
• The specialty chemicals segment contributed significantly, accounting for 63% of sales.
• EBITDA increased by 30%, with a margin improvement to 19%.
• A proposed dividend increase of 50% to €1.8 per share was announced.

Company Performance

Alchimp Group AG demonstrated robust performance in 2024, achieving record sales of €554 million, a 3% year-over-year increase. The company’s specialty chemicals segment played a pivotal role, contributing 63% of total sales. Despite challenges in the European chemical industry, Alchimp maintained a strong market position, particularly in high-margin areas such as creatine and animal nutrition.

Financial Highlights

• Revenue: €554 million, a 3% year-over-year increase.
• Earnings per share: $1.09, surpassing the forecast by 4.8%.
• EBITDA: €105.3 million, a 30% increase with a margin improvement to 19%.
• Net result: €54 million, a 56% year-over-year increase.

Earnings vs. Forecast

Alchimp Group AG’s EPS of $1.09 exceeded the forecast of $1.04, marking a positive surprise of 4.8%. However, revenue fell short at $301.77 million compared to the anticipated $309.37 million, indicating a revenue miss despite the EPS beat.

Market Reaction

Following the earnings announcement, Alchimp’s stock rose by 2.1% to $34.1. The positive EPS surprise likely contributed to this increase, while the aftermarket trading saw a further rise to $34.95, reflecting cautious optimism among investors. According to InvestingPro’s Fair Value analysis, the stock appears undervalued at current levels, with a strong financial health score of 3.25 out of 5. The company has demonstrated impressive performance with a 26.92% return over the past year and maintains a conservative P/E ratio of 7.87x.

Outlook & Guidance

For 2025, Alchimp Group AG has set a sales guidance of €580 million, representing 5% growth, and an EBITDA target of €113 million, a 7% increase. The company plans to invest approximately €100 million in capital expenditures, with continued focus on expanding its specialty chemicals segment and exploring M&A opportunities in the U.S.

Executive Commentary

"We have kept our promise and successfully exceeded the 100,000,000 EBITDA limit this year," stated CEO Andreas Niedermeier, highlighting the company’s operational achievements. CFO Georg Weichselbaumer emphasized the importance of market education, saying, "We are constantly working on bringing education about creatine, our brands and its advantages to the market."

Risks and Challenges

• The European chemical industry slowdown could impact custom manufacturing.
• Rising electricity prices pose a potential cost challenge.
• Macroeconomic factors, such as changes in U.S. administration, could affect strategic plans.
• Supply chain disruptions may impact production and distribution.

Q&A

During the earnings call, analysts inquired about the company’s strategies to mitigate electricity price challenges and the accounting for customer prepayments. CEO Andreas Niedermeier confirmed ongoing investments in nitroguanidine production, indicating no significant impact expected from potential U.S. administration changes.

Full transcript - Enact Holdings Inc (NASDAQ:ACT) Q4 2024:

Moderator: Good day, ladies and gentlemen, and a warm welcome to today’s earnings call of the Alchimp Group AG. Following the publication of the financial year 2024 figures, I am delighted to welcome the CEO, Andreas Milamaja CFO, Andreas Loeysler as well as CFO, Doctor. Georg Weichselbaumer, who will speak in a moment and guide us through the presentation and the results. After the presentation, we will move on to a Q and A session in which you will be allowed to place your questions directly to the management. Let’s jump straight into the numbers.

Mr. Niemeyer, the stage is yours.

Andreas Niedermeier, CEO, Alchimp Group AG: Yes. Thank you for the very pleasant opening. Good morning together. And thank you for joining us today. And welcome to our year end analyst call here.

As always, we will go through the presentation as we have already heard and then be available for questions for sure. So let’s skip the disclaimer and go directly to the pie, Page five. Hopefully, the technique will do that. Yes, here we go. So let me start with our outstanding sales and EBITDA growth as well as our diverse markets.

So based on our Unicards and Carbide for BUN production, we developed a portfolio of new special chemicals with leading position in the niche markets. We supply the Western world with high demand products from the areas of human nutrition with SquarePure, automotive and defense with nitroglunidine and animal nutrition with Square (NYSE:XYZ) Amino. But most of the other specialties also contributed to the successful growth as well. So the Special Products segment now accounts for around 63% of sales and accounts for almost 90% of the total earnings contribution here. As you can see, this led to an impressive increase in sales, which stands for an average growth of 7%, including COVID-nineteen and energy crisis years and a rise in EBITDA since 2016, which means an average growth of 13% up to 105,000,000 EBITDA a year.

Thus, we have kept our promise and successfully exceeded the 100,000,000 EBITDA limit this year. So but what happened else? We see that on the next page. With a very good result, we were able to achieve an EBITDA increase of 29%, mainly due to the growth of specialties. Sales have not grown quite as strongly overall, but still with 3%.

This is mainly due to the structural change in sales towards specialties and the fair treatment of our customers that we have also returned raw material price reductions to customers. A further analysis comes later in much more detail from George here. The profit after tax of $54,000,000 also reached a record level in our history. This results in a dividend proposal of $1.8 per share, which also represents a decent increase of 50% here. But this is not only in the pure numbers that we have done very well.

Last year, for example, we received a platinum rating from EcoVadis. This puts us in the 1% of companies that have managed to do this. And in addition, you can read an ESG report in the non financial statement year end closing prepared in accordance with the latest requirements and specifications of the CSRV. So we can proudly say we are thus CSRD ready. Last year, we also approved the company’s largest investment project with approximately SEK140 million.

Dollars This is already being implemented and is scheduled to go into operation in the second half of ’twenty six. Many orders have already been placed and construction activities on-site are starting just now in this date. We started with the site search in The U. S. A.

And are working through the project in a very structured way so that today, we assume that we will also get our growth projects implemented in The USA. Last year, we were able to significantly increase the liquidity of the share with a free float of almost 62%. Last but not least, this has led to a very good price plus and to the inclusion of the SDAX. The fact that we were able to significantly outperform all relevant indices and finally have been included in the SDAX selection index is a great recognition of our strategy and the success of the past years. So what else can we report?

Here on this page, I’m allowed to present our extended board team. Here, I would like to warmly welcome Martina Schwitzel. As an excellent marketing and saleswoman, she has already taken over some areas from Doctor. Weitzelbaumer since January 1, who can and should take much more care of the USAID project. But Martina Switzer will not only represent marketing and sales, but also the big topic of ESG with full commitment.

You can get the first impression by reading the so called non financial statement, which, as already discussed, we have arrived out as a so called CSRD report. We would also be happy to receive your valued feedback on this. And I’m very sorry, we have to read more than 200 pages. So the target was to reach 20 pages, but we were forced to reach and to report 200 plus pages here. So now I can pass the word on to George Weichszubama, who will analyze and explain the signals to us.

Georg Weichselbaumer, CFO, Alchimp Group AG: Yes. Thank you, Andreas. Let’s start with basics and intermediates. In this segment, we ended up with a decrease in sales compared to the previous year by 9%. Nevertheless, the profitability of the segment could be increased and our EBITDA rose to almost EUR 11,000,000, representing an increase of 14%.

The sales decline was reported throughout the year already and is based on a combination of pricing and quantity. Overall, the decrease in costs for energy and other essential raw materials has mainly led to reduction in sales prices through embedded price adjustment clauses, thereby pausing on cost reductions to customers. Additionally, we still do not compete with Asian price settings for some of our products and thus deliberately lost some quantities. However, we are convinced that this strategy is the right one and see a confirmation of this strategy by the EBITDA development in this segment. Now let’s have a closer look at our business areas.

As already seen in the third quarter of twenty twenty four, we saw positive development within our fertilizer business with our brand Welker and could increase volumes and sales. Due to the better specialization of the product for high value products, customers are willing to pay a certain premium compared to cheaper alternative offers, basically delivered from Russia. In the Metallurgy business, sales were significantly below the level of the previous year. The development was mainly driven by two effects: price escalation clauses with most of our customers paused on price reductions on the raw material side And the economic situation of European steel producers also caused volume declines. Our new trust business did not recover as fast as anticipated at the beginning of the year, and we are currently working on a transition plan for this product area.

We made first steps to move away from standard applications with high Asian pricing pressure and concentrate on specialized applications in the neutral sector to gain a significant competitive advantage. Unfortunately, it can be observed that many customers do not want to pay for regional supply chains, delivery, reliability and quality and the reliable adherence to ESG criteria in pricing. As an outcome of our pricing and volume strategy, the segment EBITDA could be decoupled from the sales decline and increased by 14% to approximately EUR 11,000,000. Accordingly, we could also increase our EBITDA margin to 6.2%, which is above the previous year’s 5%. It shows that quantity is not the only decisive factor if the optimal production structure is not negatively affected.

As mentioned several times, the products of our Basic and Individual segments are not sold to the market, but are very important raw materials for our folding production steps. And all raw materials required for the growth of our Specialty Chemicals segment could be produced reliably. This brings me to the next page where we will analyze the situation in our Specialty Chemicals segment. My colleague Andreas Niedermeier already mentioned that our Specialty Chemicals segment was again our growth driver in 2024 and contributed a major part to our record sales and record EBITDA. The segment sales reaped almost EUR $350,000,000, and this represents a very strong increase of 9% compared to the previous year.

The majority of this remarkable revenue growth was based on volume increases, while a smaller portion was driven by price increases. We’re happy to report that most product areas contributed to this revenue growth, albeit to varying degrees. Let us now discuss the development in our major product lines with our Specialty Chemicals segment. Throughout the year 2024, we have constantly reported that three product areas had a major impact on our sales growth within this segment. Those are NIPSHO guanidine, Creatine and Creamino.

Our nitroquinidine business could materially grow within the Dimplex defense industry. The increase in sales is due to both volume and price effects. Here, the shift in sales from applications in the agrochemical and automotive industry to the defense sector continued seamlessly. The current CapEx program in our nitrogen capacity expansion is the best indicator that demand within this product area is not satisfied at the current level and is expected to increase further within the next two to three years. We are very satisfied with the volume growth we had for ClearTeam Products.

The success story of ClearPure within the fitness industry continued and we managed to convince more and more customers of our quality promise. Additionally, we placed our new brand, Corea Vitalis, successfully in the market with applications in the health and pharma sector. We are constantly working on bringing all the education about creatine, our brands and its advantages in the market. Our sponsorship with FT Bayern Basketball and the upcoming Creatine Conference are just two examples of what we do. We believe in the market growth and put a new investment on its way, which shall support our growth with existing and new applications for creatine within the next years.

The Animal Nutrition product earlier also showed a stable growth trend. With our brand, CreaMino, volume and thus sales growth were achieved despite a price intensive competitive situation. The further expansion of sales activities in all major global markets is paying off and will continue to be consistently pursued. Also, the Pharmaceutical (TADAWUL:2070) sector with BioSelect and the Automotive sector with DieHard developed positively in 2024. Within the Automotive industry, we saw an increased trend from steel to lightweight construction, where our diehard products are used and deliver high quality.

In the pharmaceutical sector, our bio select benefits from the general trend that customized individually tailored D and A analyses are gaining increasing importance. We were clearly not happy with the sales reduction in our Custom Manufacture business of our multipurpose plants. This business is clearly linked to the economics of the chemical industry in Germany and Europe and was impacted by lower demand and cautious customers. We see this business as a chance and do believe to be back on the growth path if the chemical industry in Europe recovers. The positive sales development was accompanied by a strong increase in EBITDA and EBITDA margin.

With an EBITDA of EUR 94,000,000, we can report an increase of 28% compared to last year. Accordingly, our EBITDA margin increased as well and ended up at a very healthy level of 27% in 2024 percent after 23% in 2023. In summary, we can state that we are mostly satisfied with the development within this growth segment. But we see further growth opportunities. Let us now move on to our third segment, Other Cent Holdings.

This segment reached higher sales than in 2023, which was mainly due to the pass through of increased grid charges from our network operators. The services utilized were primarily variable in nature as energy supply, technical services and network operation and included the usual price increases. The segment’s EBITDA was above the previous year’s figures, which was associated with the increase in sales for grid fees of the CapEx program in our grid network last year. Now that was all for our detailed view on the segment development. Let’s now hand over to Andreas Loeysler and take a look at the overall group figures.

Andreas Loeysler, CFO, Alchimp Group AG: Yes. Also good morning from my side. And thank you, George, for the insights on our segment development in 2024. As always, I will start with a detailed look at our group P and L figures first. As already explained by our CEO, Andreas Niedermeier, we are looking back on a very successful financial year.

In terms of sales, we continued our growth story and ended up with a sales increase of almost 3% and reported group sales of EUR554 million for the year 2024. It is worthwhile to mention that this sales amount represents the highest sales in Alstkam Group’s history. As already seen throughout the year and mentioned from my colleague, the sales shifted again more and more to the segment Specialty Chemicals, which proved to be our growth segment. The sales portion of our Specialty Chemicals segments was 63% of total sales. This relationship amounted to only 59% within the comparative period and shows the current revenue trend into Specialty Products.

Our sales analysis over the twelve month period shows a volume increase of 3% over the whole group. It was already mentioned from my colleagues that this volume increase was linked to the Specialty Chemicals segment, where we reported a volume increase of 8%. Also, the volume reduction as shown for the fourth quarter was only linked to the development within our Basic and Intermediate segment. Our EBITDA development could also continue the trend as seen within the quarterly reports of the year 2024. And we can report an EBITDA of EUR105.3 million for 2024, which is the same as for the sales represents a record for Alskim Group.

The reason for this positive development clearly relates to the increased sales portion of and the volume growth within the higher margin business of Specialty Chemicals. In terms of comparative figures, our EBITDA increased by almost EUR 24,000,000 or 30% compared to last year. Our EBITDA margin also showed a positive development and a strong increase. For the whole year 2024, we could reach an EBITDA margin of 19% after 15.1% last year, an increase of 26%. The positive development in EBITDA has also materially influenced the group net result in 2024, which increased by almost EUR 20,000,000 and ended up at EUR 54,000,000, an increase of 56% compared to 2023.

Our reduced financing costs also supported the growth in net result. Interest income could be increased due to our strong cash position and interest expenses could be reduced due to lower interest rates and lower outstanding loan amounts. As a consequence, we increased our earnings cash to after per share in 2023. And this was the reason for the increased dividend proposal, which Andreas Niedermeier mentioned at the beginning of this presentation. That was the big picture of our P and L.

Now let’s move on to the balance sheet and cash flow figures. Our balance sheet and cash flow have also shown a very healthy development in 2024 and all major KPI could be improved. The increase within our total balance sheet of approximately EUR 60,000,000 was driven by higher investments and materially improved cash positions on the asset side. Compared to last year, we increased our investment activities and showed a growth in fixed assets of EUR 60,000,000. On the other hand, we could reduce our inventory level since last year, which contributed to a slight reduction of working capital as well.

As mentioned already, the main impact on the balance sheet came from our positive cash development. At year end, cash amounted to EUR 61,500,000.0, which represents an increase of almost EUR 50,000,000. As we made all loan repayments during the year on schedule and have not used any short term financing lines, we can report a net financial asset of EUR 13,000,000 at the end of twenty twenty four after a net financial debt of EUR 46,000,000 at the end of last year. On the other side of the balance sheet, we can see a positive development within our equity and equity ratio. Equity amounted to EUR207 million, which represents an increase of approximately EUR44 million since last reporting date and accordingly increased our equity ratio to a very healthy level of 43% by the end of the year 2024.

As a one off impact, equity was reduced by the amount already spent for our share buyback program. In fact, EUR 1,500,000.0 by the end of twenty twenty four, representing a bit more than 25,000 shares. As mentioned already, we are very satisfied with our strong and healthy cash developments throughout the year. As a result of our very good net earnings and ongoing very close look at our working capital management, we could materially increase our operating cash flow to EUR105 million, which represents an increase of 45% compared to last year’s period. The cash flow from investing activities has been reduced by an amount of EUR 12,000,000, which represent the first installment from the European Union subsidy program ESAP for our current investment program in nitroguarinidine expansion.

Approximately EUR 10,000,000 were already spent for this major single project in 2024. Our financing cash flow was mainly impacted by dividend payments of EUR 12,200,000.0 and scheduled loan repayments throughout the year. Again, we were neither required to use our short term financing lines nor our factoring lines. As you can see, Alstom (EPA:ALSO) is in a very stable and healthy cash situation and Zoos is prepared for further growth investments in the future. And this brings me to the outlook for financial year 2025.

From today’s perspective, we see a further growth. Sales are expected to grow to approximately EUR $580,000,000 and EBITDA is expected to grow to approximately EUR 113,000,000. This represents a sales increase of approximately 5%, while EBITDA is expected to grow by approximately 7%. The planned sales growth will continue to be achieved organically. The fundamental growth drivers are expected to be volume effects within segment Specialty Chemicals, which will overcompensate a slight sales decline in segment Basics and Intermediates.

Further growth in the Specialty Chemicals segment shall be achieved through volume increases for our products CarePure, Re Amino as well as Nitro Guanidine. In addition to that, we also expect an increase in volume and sales in the area of custom manufacturing for our multipurpose plants compared to the previous year as the overall European chemical industry is expected to slightly recover. In the Basics and Intermediate segment, sales are expected to be slightly below the previous year’s level with possible positive developments in the neutral product area after a strategy change in the current product mix. We expect the prices for P. Raw materials and logistics to remain stable at the 24 level, while energy prices are expected to stay at the elevated level of the fourth quarter of twenty twenty four.

The sales growth in the Specialty Chemicals segment leads to a further increase in the sales share of this segment in our total sales. Consequently, the EBITDA of this segment and the EBITDA margin of Altschem will also grow. So that’s it from our side with the information for last year and the outlook. At this point, we would like to thank you for your appreciated attention and are now at your disposal for possible questions.

Moderator: Thank you very much for your presentation and congratulations to your growth. We will now move on to the Q and A session. For a dynamic conversation, we kindly ask you to ask questions in person via audio line and we already have two hands up. To do so, click on the raise your hand button. If you have dialed in by phone, please use the key combination star nine followed by star six to enter the queue.

Analyst: Good morning and congratulations on a great quarter. A couple of questions from my side. Firstly, Q4 margin in specialties was surprising at 30% on what was relatively stable pricing. I think it’s a big push came from lower electricity and as I know you purchased electricity up to three months in advance and obviously produce more as well during summer. So regarding the inventory availability produced at that great price level, What margin can we expect in Q1 keeping in mind last year’s Q1 group EBITDA margin of 16.6%?

Thank you.

Andreas Loeysler, CFO, Alchimp Group AG: Okay. Yes, you are right. We had a very good quarter four in last year, but there were some special impacts in the fourth quarter. It’s as you know, we are very an energy intensive company. And so we get some subsidies from the power market and those usually materialize in the fourth quarter of the year.

So we can allocate this into our accounting rules in the fourth quarter only. And your question regarding the EBITDA margin for the next quarter, you can expect a slight increase compared to the fourth quarter to the first quarter of last year. And the second question was regarding inventory level. Was it correct?

Analyst: Yes.

Andreas Loeysler, CFO, Alchimp Group AG: Inventory level for the end of the year, it will increase as we will have a major shutdown of one of our furnaces by the beginning of twenty twenty six. So we will start in the second half of the year increasing our carbide inventory level in order to be able to deliver the market.

Analyst: Okay. Thank you. A follow-up question on the dividend payout. It was a bit higher than guided at 35%, the payout ratio. Is this sustainable given the upcoming CapEx spending?

And if yes, can we take this level as well for 2025?

Andreas Niedermeier, CEO, Alchimp Group AG: Yes, that’s Andreas speaking. That’s always the discussion. So I have to be honest, I have two hearts in my body. So on the one hand, we have to invest our CapEx and we have to fuel our growth. And on the other hand, we all want to make happy our shareholders.

So from that point of view, I always said that we want to see a 30% to 50% dividend payment. But actually, we will be more on the lower end and you should calculate more on the lower end between 3035%. So hopefully, the cash flow will come quite well then we can afford a good dividend for the next year as well.

Analyst: Okay. Thank you. And a final question from my side, a quick one. Could you just comment on the exposure to Ukraine pre war and how Alstom could benefit from a conflict resolution there?

Andreas Niedermeier, CEO, Alchimp Group AG: So from our point of view, there is no short term effect expected from the Ukraine war. I think there is a more or less long term effect expected because we have to think about our, let’s say, topic, how many munition do we have on stock, how can we fight against aggressor in the future. And from that point of view, I think many, many people will invest a lot more in defense than in the past. And from that point of view, I do not really expect short term issues, more long term growth and long term issues here.

Analyst: Okay. Thank you very much. And once again, congratulations.

Moderator: Thank you, Mr. And Oliver Schwarz, it’s your turn.

Oliver Schwarz, Analyst: Yes. Thank you very much. I also like to congratulate you on the fantastic results. Well done, gentlemen. But let’s say, on to your new frontiers now.

Can you quickly talk me through the slight volume and price decline in Specialty Chemicals in Q4 twenty twenty four? Is that all due to the weakness in custom manufacturing and perhaps some passing through of lower or material costs? Or is there something additional in that explains that slight decline? That would be my first question.

Georg Weichselbaumer, CFO, Alchimp Group AG: Yes. That decline can be attributed to products, both for creatinine and for CreaMino. For CreaMino, we are in a highly competitive environment, and we need to make certain that we find a balance between volume and prices. And in order to maintain a certain volume ratio, we had to lower prices. Second part is for Clearaptine and ClearPure, where we saw a slight decline in the fourth quarter.

But fortunately, that was only for the fourth quarter. Sales have picked up in the meantime and ClearTeam ClearPure is going strong again.

Andreas Niedermeier, CEO, Alchimp Group AG: And I think so it was only a month or, let’s say, a year end close effect. So you can’t really calculate which turnover comes in December or which one in January. And so from that point of view, we saw a strong and a good January. And the decline in sales was not so much recognized from our side.

Oliver Schwarz, Analyst: Fair enough. Thank you for that. Second question is electricity prices somewhat went through the roof in January and also most part of February in Q1 twenty twenty five. Can you please elaborate a bit on the impact? I know that you hedge electricity prices to some extent and also do some, let’s say, physical hedging regarding your carbide production or carbide usage.

Is there you related to a slight increase in the overall margin in Q1. So does that effect come later? Or is there no effect of those swings in the electricity prices foreseen as of now?

Andreas Niedermeier, CEO, Alchimp Group AG: Yes. So electricity prices are quite high. And I honestly ask the politicians to think about that in Europe very deep because that is really a topic we have to maintain and we have to think about. So we have seen higher costs in electricity already in January for sure and we have seen that in February as well. So how we reacted, so we have saved electricity and we purchased that in Sweden.

So from that point of view, there was no problem. But in Germany, we had some shutdowns of our ovens and our cobalt kilns to react against that and to have not a big negative effect in our P and L figures. Some effects you will see, but we will do quite well like that.

Oliver Schwarz, Analyst: Okay. Thank you for that. And the last one, at least for this round, I might queue up also for some other questions after that. When talking about the customer manufacturing, you correctly pointed to due to weakness in European chemicals, which makes it harder for you to fill your capacities. That’s also true for when talking to your competitors, regardless of who they are.

And this situation has been going on for, I’d say, talking to the others as well, almost two years now. Is that probably more of a structural

Andreas Loeysler, CFO, Alchimp Group AG: problem if we assume that

Oliver Schwarz, Analyst: European chemicals won’t come back to the assume that European chemicals won’t come back to their full strength due to the structural higher production costs given higher energy costs and also some also labor costs, Is there more, let’s say, competition from Asian, especially Chinese competitors in these markets? So how likely is it that volumes will come back given, let’s say, lower structural demand in the European chemical industry for the short and midterm and maybe also some more price aggressive Asian competitors?

Georg Weichselbaumer, CFO, Alchimp Group AG: I mean, it’s hard to predict what the recovery in the chemical sector would look like. When we look at our business and compare ’24 to ’25, we had in twenty twenty four two effects for lower sales. One was a destocking at the customers and the second one was reduced growth expectations. The destocking effect for 2024 is gone, and we see the positive effects of that already in 2025. When we look at the portfolio of our multipurpose plants, it is not high volume products at lower costs, which are usually attacked by aggressive Asian competitors.

It is new specialty products where our customers have a competitive advantage. And this is then not so much due in our portfolio to the overall development of the market but specific development of the areas. And there’s one or two in which we see growth, which in which we had invested see some of that coming to fruition already this year.

Andreas Niedermeier, CEO, Alchimp Group AG: Yes. So order intake let’s summarize. Order intake is quite healthy within multipurpose plant. So only one to add. So our new trials product portfolio is really struggling and we do some restructuring there.

We are not through. But we think that we can make it by the end of that year, but it will take some time to restructure that to higher valued chemicals and specialties. And that’s ongoing, yes.

Oliver Schwarz, Analyst: Thank you very much. I’ll come back in soon to you. Yes.

Moderator: Thank you, Mr. Schwartz. And Konstantin Wiecher, here’s your space to speak.

Konstantin Wiecher, Analyst: Yes. Thank you so much. Also congratulations from my side, gentlemen. Just maybe starting with maybe a follow-up on the Tri Amino question. Is that really just impacting the price levels, but is then covered also through raw material prices?

Or did you also take a hit on the margin there? And what are your expectations for the current year? And with that regards also, I’ve seen that your sales basically in every region grew but declined in The U. S. By about 4%.

Is that mainly the result of the lower prices in Crea Immuno? How has played the Crea team in this as well? Just some color on that would be great. And then if I’m allowed on Cria Vitalis, you mentioned Health and Pharma sector. I remember that you were also having projects with Dairy customer.

How is that progressing?

Georg Weichselbaumer, CFO, Alchimp Group AG: I think we can respond to the last question fairly easily. Yes, it is progressing. And it’s progressing fairly well. We’ll see first most likely first sales there already this year. With regard to Crea Amino, of course, we have had fairly low raw material prices, mainly of glycine, which we passed on into the market.

And that was also one of the reasons for the lower sales figures. Also in The U. S, and that could be one part of the answer, we’re still working very hard to expand our sales reach for Clearmino. We have actually a little bit tweaked our strategy and approach more medium sized customers where we are in good discussions in both the product trials. So yes, it is correct that we did not have the biggest growth in The U.

S. Last year, but we have high hopes that this will change this year.

Konstantin Wiecher, Analyst: Okay. Perfect. And a couple of more, if I may. Another one would be on your agriculture business. If you could share some more color on that in general, how that has developed through the regions and products, maybe also commenting on potential restocking that you might have seen in the fourth quarter or not and how your year started in that business?

Georg Weichselbaumer, CFO, Alchimp Group AG: I mean, when we look at the major products, which we have in the agriculture sector, let me start with the fertilizer with PELCA. In PELCA, we saw an interesting development, which actually was shared with the entire industry. We increased prices in the fourth quarter and continue to do this also in the first half of this year. And usually, you should expect that you lose volumes by doing so. The opposite happened.

We had higher volumes, which continued also in the first quarter of this year. So FELKER is doing very well. On the Immunx side, we still have not tailor wind from the regulatory side. So we keep growing M and X also, but we would be delighted if it was a little bit higher. On the dormak side, we continue to suffer from patient competition since they imported at very, very low prices.

But we continue to have a good foothold more on the specialty side. And in addition, that was not covered in that detail, we see quite some growth on the Cetaphix brand.

Konstantin Wiecher, Analyst: Okay. Thank you. Especially regarding the PELCA, do you expect any impact from maybe in the future from the higher tariffs that the EU has implemented against Russian nitrogen fertilizer? I mean, in January, I know your Perka is playing in a different price range anyways. But over the next years, I think these tariffs are really ramping up quite significantly.

So would you expect that Europe products could also become more competitive for crops that would also be sufficient with standard nitrogen fertilizers?

Andreas Niedermeier, CEO, Alchimp Group AG: So we are very happy to see that tariffs on that because to be honest, that was only import of gas through fertilizer. And so hopefully, they will slow down that or stop that at the end of the day. But as you know, the fertilizer season is more or less through by the mid of that year. And they have predicted to set debt tariffs in place by, I think, July. And from that point of view, it doesn’t really help for that season.

For the next season, hopefully, yes.

Konstantin Wiecher, Analyst: Okay. Perfect. Great to hear. If I’m allowed one last question. Just some progress on your U.

S. Site project. Anything you could share in terms of progress you made on selecting a site and when we might see a definite announcement here?

Georg Weichselbaumer, CFO, Alchimp Group AG: I mean, we can describe progress insofar as we have identified a handful of sites and which we are now carefully scrutinizing towards the parameters which we have set. And we are progressing. But for us, it’s important also we have no time pressure here. We take the time which is required to make a good selection. And we have in parallel started another more broad approach where we actually hired a company in The U.

S. Who does site search for a living. And that will be a structured approach within the next six months, which would potentially help us to identify that additional sites. So yes, continuing, but no time pressure.

Konstantin Wiecher, Analyst: Okay. And is there any perception, has there anything changed? Because it looks like it takes a bit longer than maybe we have thought at the beginning. Is it more the pricing side that you don’t find the right target at the right price or that you really don’t find the right target at all?

Georg Weichselbaumer, CFO, Alchimp Group AG: Nothing of that. I mean, we have set ourselves a target to have the site search completed by mid of next year. And when you look at the time line of such a process, it is not required to have absolute urgency in doing it. We do it more with scrutiny. We look at what is available.

And we will select a site which has the best fit with us. We have identified some sites which could fit that. But the time line of our U. S. Expansion is not set by the site selection itself, but more by the time line of the construction of a nitroeconnecting plant.

And that is clearly defined not to start before 2027. So we have time until mid of next year to finish the site selection process.

Konstantin Wiecher, Analyst: Okay. I’ll leave it here and leave some room for the others. Thank you.

Moderator: Thank you, Mr. Richard. And we have four more hands up. The person with the phone number ending 553, you are allowed to speak now.

Peter Heisler, Analyst, Syncapital Tankers: Peter Heisler here from Syncapital. Tankers. Thanks for having me ask some questions. First, regarding the guidance, you mentioned already the planned investments in working capital. And given the nitrokonidine and the konidine chart investments, would it be fair for us to expect total CapEx of approximately $125,000,000 in this year?

Andreas Loeysler, CFO, Alchimp Group AG: Yes. Oh, you have a second question. Go on.

Peter Heisler, Analyst, Syncapital Tankers: Yes. Okay. The second question would be also about the guidance. You expect in custom manufacturing a volume and price increase in this year, which is a recovery to what we have seen in the last two years or so. So how do you think how does this guidance compare to the general economic environment, which does not seem to be very optimistic, if we believe, to what the leading economic research institutes will tell us?

And our third question would be on The US on the last USUWS region. You made approximately 16% of your revenues in the NASHU Asia region last year. Can you tell us approximately what proportion of this would be affected by Trump tariffs, if there will be any without considering the situation of the Chinese competitors, which may be affected more than you. But just to have an idea here, which part of the NAFTA issuance could be affected by the tariff?

Andreas Niedermeier, CEO, Alchimp Group AG: Okay. Thank you, Peter, for the questions. This is Andreas speaking. So to keep it very easy, CapEx, you should calculate around NOK 100,000,000 next year. That would be a fair figure next.

And when I’m talking about next year, then I’m talking about for sure 2025 and not 2026 because we are reporting 2024. Then customer manufacturing. So I think we see Alsken typical development because what we have seen is that the storages are empty from our customers and we have a good order intake here. And we can do quite well in comparison to the overall chemical market. So I think that’s very, very connected to the Alstecan development.

And now the tariffs, so yes, we don’t see really clear actually. But to be honest, we have no real competitor in U. S. We have competitor in U. S.

Out of China. And our calculation is that Chinese will receive more tariffs than we and then we will see the results. So from that point of view, we don’t see any big negative effects about the tariffs today.

Peter Heisler, Analyst, Syncapital Tankers: Okay. Only fair. Thank you. And maybe if I may, another question. You converted the first production plant to hydrogen in the fourth quarter to replace that natural gas.

Could you quantify the impact on the earnings that may come out of that conversion in this year?

Andreas Niedermeier, CEO, Alchimp Group AG: So for sure, that’s an inside product we take as an energy resource actually, and we try to screw that up as well because we want to increase the production more because that’s a byproduct, which is produced through producing creatine. The yearly positive effect is, let’s say, below NOK 1,000,000. But it’s quite a positive effect, which will help to increase the profitability overall.

Peter Heisler, Analyst, Syncapital Tankers: Thank you very much.

Moderator: Thank you so much for your question. And we will go on with Patrick Schweck. You should be able to speak now.

Patrick Schweck, Analyst: Yes. Hello. Good morning, gentlemen. Can you hear me?

Andreas Niedermeier, CEO, Alchimp Group AG: Yes.

Patrick Schweck, Analyst: Nice. Also from my side, congrats on your very strong results. I have one or two questions left. The first one is on your operating cash flow. It was even stronger than I expected last year.

Were there any effects included from prepayments of your nitrile guanidine customers yet? And if so, could you share the number?

Andreas Loeysler, CFO, Alchimp Group AG: Clearly, no. There were no impacts in last year. We expect the payments for this year.

Patrick Schweck, Analyst: And can you share your expectations for prepayments for this year roughly in number?

Andreas Niedermeier, CEO, Alchimp Group AG: So we are very sorry about that. We are under secrecy agreement with our customers. And from that point of view, we are not allowed to share that in very detail. You will see that at the end of the day then in the cash flow and in the cash situation for sure. But actually, we are not allowed to do that.

Patrick Schweck, Analyst: Fair enough. Then my second question is on the EUR 100,000,000 CapEx volume you mentioned for the current year. Is this number before EU subsidies, right?

Andreas Loeysler, CFO, Alchimp Group AG: It’s before EU subsidies because the major part of the EU subsidy will be paid by the end of the CapEx program in 2026.

Patrick Schweck, Analyst: Understood. All right. Thank you.

Moderator: Thank you so much. And we will go on with Fabian Kaap. The stage is yours. Can you unmute yourself, please? In the left corner.

Fabian Kaap, Analyst: Okay. Does it work now?

Moderator: Yes.

Fabian Kaap, Analyst: Okay. Thank you very much. Congratulations also from my side for the figures. I have two questions, perhaps one by one. First is on your U.

S. Investments in the nitrochronolybdenum business. Does the change in The U. S. Administration change anything in your risk perception?

Andreas Niedermeier, CEO, Alchimp Group AG: No. No.

Peter Heisler, Analyst, Syncapital Tankers: So

Fabian Kaap, Analyst: I understand the answer is no.

Peter Heisler, Analyst, Syncapital Tankers: Okay.

Fabian Kaap, Analyst: Okay. So they still need this product to be bought from you. Yes?

Andreas Niedermeier, CEO, Alchimp Group AG: Yes.

Fabian Kaap, Analyst: Okay. Second is on And

Georg Weichselbaumer, CFO, Alchimp Group AG: it continues to be a high priority.

Fabian Kaap, Analyst: Okay. Okay. Well understood. Thank you very much. Second is, you know this question already is on future potential use cases, additional use cases of Care Team Clear Pure, especially diabetes.

Has there anything changed on this matter?

Andreas Niedermeier, CEO, Alchimp Group AG: So to be honest, what are you thinking about diabetes and ClearPure? I’m not really sure.

Fabian Kaap, Analyst: I’m thinking about the potential use of creatine in the diabetes process at the hospital. I don’t know the English words.

Andreas Niedermeier, CEO, Alchimp Group AG: And so you are talking about the dialysis? Yes, yes, yes.

Fabian Kaap, Analyst: Sorry about that.

Georg Weichselbaumer, CFO, Alchimp Group AG: No changes. It is continuing and our customers expect potential first sales already this year.

Fabian Kaap, Analyst: Okay. So we might see I understood we might see something this year already on this issue.

Georg Weichselbaumer, CFO, Alchimp Group AG: Maybe it depends. There is still an approval process, depends for customer ongoing. But the most optimistic view they have is that there could be some first sales already this year.

Fabian Kaap, Analyst: Okay. Thank you very much. And congratulations on that also. Yes. And have a good year 2025, too.

Andreas Niedermeier, CEO, Alchimp Group AG: Yes. Thank you. We will do it.

Moderator: Thank you so much. And one short question from the chat box. Could you briefly announce the sales share of mitrougynidine in the Specialty Chemicals segment and the share of EBITDA and what do you anticipate happening in this field? Thank you.

Andreas Niedermeier, CEO, Alchimp Group AG: So we are very sorry. So we received such kind of questions many times, but we decided not to disclose single sales and EBITDA topics on the product level because that could be a competitive disadvantage. Because we are the single European supplier and if we disclose all that details, that could destroy many topics and that could not be the target of our shareholders. And from that point of view, we want to save the business and we want to save the shareholders. And for that issue, we are very sorry.

We do only the details on the segment level.

Moderator: Okay. Thank you so much. And one last hand up from Mr. Oliver Schwalz. You should be able to speak now.

Oliver Schwarz, Analyst: I am. I am. Thank you. Yes, quick some follow-up questions, gentlemen. Firstly, on the shutdown of the kiln and carbide kiln that’s earmarked for the first quarter or for the beginning of twenty twenty six.

You said you will be building inventory in the second half of twenty twenty five to have the required raw material volumes that you’ll need in 2026 at hand when you reduce carbide production. Normally, what you do when I’m not mistaken, you decide whether to use all three kilns is very much depending on electricity prices. But now it seems, let’s say, at least in the second half of twenty twenty five, you might be forced to build inventory and hence to employ all three kilns regardless of the level of electricity prices. Is that correct? And if so, might there be a negative impact on the respective earnings once the raw material is used in 2026?

That would be my first question.

Andreas Niedermeier, CEO, Alchimp Group AG: So Oliver, to summarize that, we will do that very carefully. And we had already started increasing carbide quantities in stock. And we have the chance to shut down always one kiln when the electricity price went up. And we do that big maintenance issue during the winter because during the winter, you normally receive much higher electricity prices. So from that point of view, we try to storage more or less summer electricity prices and receive that back in the winter, and we don’t expect negative effects on that.

So there could be cost. The second question, I would imagine, what is the effect of maintenance costs? That’s a big pile of maintenance for sure. That’s more than 5,000,000, But that is included in our normal maintenance budget. So we will do other maintenance lower and we will concentrate on that.

So from that point of view, I don’t expect much higher maintenance costs. Some higher but not much higher.

Oliver Schwarz, Analyst: Fair enough. Thank you very much. Very clear. Second one is looking at your outlook 2025 regarding Specialty Chemicals segment. You expect increased volumes, Creapur, Crea Amino and nitroguanidine.

I guess, Crea Peru and Crea Amino, especially if you are planning to increase the capacity of Creapur, that’s probably a no brainer. But increasing nitroguanidine volumes seems to be tricky. Firstly, you are basically working on the site to replace and expand production, which might or might not lead to temporary shutdowns. And I was not under the impression that you have, let’s say, spare capacity in Nitro Guernidin. And the big capacity expansions, obviously, will come only by the second half in 2026.

So how is it that you can increase nitroguernidine volumes?

Georg Weichselbaumer, CFO, Alchimp Group AG: Very simple, work hard on the production.

Oliver Schwarz, Analyst: So what you’re stating at you guys have been lazy up to now?

Georg Weichselbaumer, CFO, Alchimp Group AG: No, not necessarily. But when we look at the nitriculating plant, it was not so much a growth business. It was more a business to optimize the run

Andreas Niedermeier, CEO, Alchimp Group AG: of the equipment. Now we are in

Georg Weichselbaumer, CFO, Alchimp Group AG: a different scenario. And part of the investment money which we receive from of the ACIP funding goes also into small expansion projects for Nitro Quadrant at the existing unit. And I mean, it has always been in our genes that we are able to increase capacity as required, and we have ideas on that. So it was not that we were lazy, but rather that this was not the focus at Natchez Gondin. Now things have changed.

Andreas Niedermeier, CEO, Alchimp Group AG: Yes. And we will take bottlenecks away. And for sure, we are always so relaxed when there is no producer in the room. But that’s the truth. We try to debottleneck the plant and we think that we would be very successful in the year.

Oliver Schwarz, Analyst: Okay. All right. And the last one that might be a tricky one to ask or to answer. When looking at your free cash flow in 2025, you stated that CapEx might be around about $100,000,000 due to the expansion mainly in nitroboronidine and obviously also in maintenance and also expansion in other parts of your business. So let’s say from when looking at your EBITDA guidance and the CapEx as such, I’d say free cash flow might be negative in 2025.

But on the other hand, you have, let’s say, funds coming in from your customers that are willing to pay for the expansion in Nitro Guarindine. So at the end of the day, would you expect free cash flow to be negative or positive in 2025?

Andreas Niedermeier, CEO, Alchimp Group AG: So to be honest, George did a very good job last year in connection with customers. And from that point of view, we think that we are quite positive next year. This year.

Oliver Schwarz, Analyst: Yes. And how would that play out in the balance sheet? Would that be recognized, let’s say, as, let’s say, prepayments or

Andreas Niedermeier, CEO, Alchimp Group AG: That’s a very, very good question. So I think Andreas should should elaborate a little bit on that because that will change the balance sheet and all of you should be aware of that. Yes.

Andreas Loeysler, CFO, Alchimp Group AG: Accounting treatment for the customer brands will be a bit more tricky than accounting treatment for the European Union subsidies, because the European Union subsidies will be just deducted from the investment cost and will show up in the investing cash flow. But the grants from the customer, which George collected is that will be shown in the balance sheet as advanced payments on the liability side. And until we start with the production, we start with the delivery of the new goods from the new company. And then when we start with delivering the goods from the new company, we will release the liability and recognizing revenue for these items for these prepayments, down payments. So this will be a bit tricky and we will definitely working on a good communication story this year to inform the capital market of this about this special accounting treatment.

But this is also the reason why we stated that we will have a slightly reduced equity ratio by the end of the year. This is just because we are expecting a strong increase in our balance sheet total resulting from the down payment.

Oliver Schwarz, Analyst: Fantastic. Thank you. That’s it for my questions for today.

Moderator: Thank you so much, Mr. Schwarz. And one last fast question in our chat box. Do you have plans on M and A in 2025?

Andreas Niedermeier, CEO, Alchimp Group AG: Yes, for sure. We work quite hard on that topic. So on the one hand, there is a possibility only to purchase land in The U. S. A.

On the other hand, it could be the possibility and the case that we can purchase a company. So that would be the best thing to find a company with an organization and to use that organization for creating new business there. And from that point of view, that could be the case for sure.

Moderator: Thank you so much. We now come to the end of today’s earnings call. And you will find the presentation on the website of Altium Group AG and also at the Airtime website by kicking into today’s event. Dear participants, thank you for joining and you’ve shown interest in the iQIN Group. Should further questions arise at a later time, please feel free to contact Investor Relations.

And a big thank you also to Mr. Mira Meier, Doctor. Weichse Baumer (BVMF:BALM3) and Mr. Luzer for your presentation and the time you took to answer the questions. My name is Judith.

It was a joy to be your moderator today, and I wish you all a lovely end of the week. With this, I hand over to Mr. Nirameier for some final remarks.

Andreas Niedermeier, CEO, Alchimp Group AG: Yes. Stuart, thank you for your warm welcome here. And thank you very much for all of your questions and being in that presentation. So I think it was first time that we did that more than one hour. So interest level is quite high.

So then we can now offer you the opportunity to visit us again. You can see that on that page virtually or in person at the conferences as shown here. Otherwise, we will be back with our quarterly statement in the first quarter of twenty twenty five on April 30. And up to that, thank you for your support. Stay safe and sound and stay in our good graces.

Goodbye. And hello and a laugh to that weekend. Have a nice weekend and party the weekend then. Yes. Thank you.

Bye bye.

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