Südzucker Aktie

Ladies and gentlemen, good morning from Mannheim. We welcome all of you to our conference call. The underlying presentation for this call has already been published this morning on our website. Today, we released the statement for the first half of the financial year '25/'26. We are going to present you the highlights of the period, revisit our full year group earnings guidance for the business year, which we adjusted on August 21. Following the presentation, we are going to answer your questions. As already mentioned, a recording of this call will be available on our homepage shortly after the call.

Now let me hand over to our CFO, Dr. Stephan Meeder.

Thank you, Matthias and Andreas, for the introductions. Ladies and gentlemen, also a warm welcome from my side, and thank you very much to all of you for your interest showing in Südzucker. As mentioned, I would like to give you a brief overview about the business performance in the first 6 months of fiscal '25/'26. And I would like to give you some more details about the confirmed earnings guidance for fiscal '25/'26.

So let me start with the highlights of the past 6 months of the fiscal. You will find this on Page 5. But before going into the details upfront, let me say, more general remark on where we stand as of today. So you can see in the figures that there is a weak performance in Q2. Yes, it came in as expected, but it's clear, it's a weak performance. But on the other side, we confirm our full year financial guidance for the operating profit as of today, which stands at EUR 100 million to EUR 200 million. So when looking into the remainder of the year, we believe that from Q3 onwards, this should be the turning point to the positive, but the figures that I will continue to explain to you in the following for Q2 and H1 show a weak performance.

So going into the details, you can see that Q2 was -- performance was not able to match prior year's numbers for Q2, and the same is true for H1 -- compared to H1, and after 6 months, we have reached the following numbers. You can see group revenues came in at roughly EUR 4.2 billion, which is significantly below prior year's level. Same is true for group EBITDA, which was significantly down by 55% to EUR 189 million and group operating profit also only reached EUR 42 million versus EUR 269 million in previous year's period. Same is true for cash flow, which decreased to EUR 67 million. And when it comes to net financial debt, so net financial debt as of 31st of August this year came in EUR 285 million below prior year's level and did remain stable compared to the end of fiscal '24/'25, which is end of Feb '25.

So let me continue with the next pages. We have a look here on H1. So bringing H1 into historic context, you can see that especially for operating group results, this is a strong decline compared to previous year's periods. You can see that the decline is in revenues, EBITDA and operating result. Particularly affected in H1 are the segments of sugar, special products, CropEnergies, starch, but we do see an increase in the fruit segment. And that is something important to note. We do this in each and every quarter. We know we are active in volatile markets, but what is good about Südzucker Group that it is a strong and resilient portfolio, and we always have divisions who do also benefiting for the group with a strong performance. And overall, this year, this is the fruit segment, but we also see a good development in the divisions of BENEO and Freiberger.

So on August 21, we changed our group guidance for the fiscal '25/'26. We now expect revenues to range between EUR 8.3 billion and EUR 8.7 billion for the full year, EBITDA between EUR 470 million and EUR 570 million and operating profit between EUR 100 million and EUR 200 million. So further details for the outlook, I will give on later. What we can see, if we move on to what we will see on Page 10 is there are persistently low sugar prices in the global market and challenging EU market environment with continuous impact into autumn 2025. And we also do see continuous volatility or volatility going forward, which you cannot exclude due to geopolitical and global economic conditions. You are all fully aware of that.

So let's move on to Page 9. You can find -- it's a little bit difficult to read, but it's a little bit also a backup information for you. Here you can find the detailed results of the segments. And as already mentioned, after 6 months, group revenues came in -- [ operated ] levels. We do see revenues decline in the segments of sugar, special products, CropEnergies and starch, but revenues rose slightly in the fruit segment. And when it comes to the EBITDA, as already stated, there's a decrease as well as an operating result. This is largely driven by the sugar segment, but was also significantly below prior year's level in special products, CropEnergies and starch segment and positively to note the fruit segment showed an increase.

So most important, which is for H1, really important to discuss in more details is the development in the sugar segment and to see the developments in the sugar segment, we have also always have to have a close look what happens on the global sugar market. So I start with the global sugar market on Page 10 because this has an impact on the European sugar market and the development of the European sugar market has an effect or [indiscernible] for the sugar segment development in Südzucker Group.

So let's have a look on the sugar market as a total on the worldwide scale. You will find that, as I said, on Page 10. Let's have first a look what is positively on the world market. You can see that the consumption is still growing. So on a worldwide scale, sugar market is still growing. You see this is the normal blue bars. You can see that consumption is going up. Dark blue is the production. And you can see that we have in '24/'25, a market with a deficit and deficit market and commodity markets are beneficiary to the prices. That is the situation we started. But in '25/'26 sugar marketing year and just as a reminder, sugar marketing year always starts 1st of October and it goes until end of September. So for sugar marketing year '25/'26 and '26/'27, it is expected to be that the market is in a surplus. That means production going over consumption.

And in a commodity market, this is leading to a bearish sentiment on the prices. This is also if you have a look on the sugar market prices, we do not have this in this presentation, but you can find this in our investor slide deck on our homepage, they have all the detailed price developments. And you can see that recently, there is still a downward trend in market prices. And another factor also contributing to that compared then into euro is the weakness of the U.S. dollar, which is also a bearish factor.

So going from the global sugar market or coming to the European sugar market. So as a mid-summary, we can state that from the world market, we do not have a support. The contrary is true. So there's a bearish sentiment for sugar on the world market, and this translates also to the situation in Europe. So here also the graph, you can see the dark blue is the production and the normal blue is the consumption. When it comes to consumption in Europe, you can see that there is a -- it depends whether you start looking into the figure '22/'23. If you take this, you can see that it is rather stable consumption in Europe. If we take also into consideration '21/'22 as a starting point, we can also come to the conclusion that European market is rather in a slightly downward trend.

So going into the details for the recently started sugar marketing year '25/'26, so which started 1st of October '25, the EU Commission and also the analysts from market survey expect a significant decline in cultivation area for Europe, so less acres with sugar beets. So based on this production, including isoglucose is forecasted to decrease to 15.9 million tonnes. That's the graph or the bars on the right-hand side in the graph. And as a result, the EU is expected to have a balance in export/import volumes.

The sugar price, let's have a look on the sugar prices, but it's not on the graph, but let me explain to you the development for the sugar prices. So the sugar prices, which have been published by the EU Commission, fell significantly down from EUR 619 per tonne at the start of the '24/'25 sugar marketing year in October '24 sharply. And since it has continued to fall, reaching EUR 550 per tonne at the start of the '25/'26 fiscal in March '25 and in July '25. So this is the latest available publication, EU sugar prices stood at EUR 534 per tonne.

So one aspect that we always have to put into consideration when we discuss sugar prices in Europe is what is happening with Ukraine. As we stated in the last conference calls, one factor which heavily weighed on European sugar prices was the Ukraine imports over the last years and months. So at current stage, the EU Ukraine Association agreement foresees that the import -- allowed import or the duty-free allowed imports into the EU amount to 20,000 tonnes for this year, pro rata temporary. But the ongoing discussion is to increase those volumes to 100,000 tonnes as of 1st of January next year. So for sure, we stand with Ukraine, but we're heavily opposed to those additional duty-free imports given the fact that the European market is well supplied.

So after having had this macro look on the world sugar market development, the European market development, how does this translate to the Südzucker Group sugar segment? You can see in the graph on the right-hand side that revenues significantly decreased. So in H1 '24/'25, we stood at EUR 2.1 billion in turnover. So this has decreased to EUR 1.4 billion. And when it comes to operating profit, it even turned to a loss situation. So in H1 '24/'25, we stood at an operating profit for the group for the Südzucker segment at EUR 72 million, and this has turned to a loss situation of EUR 89 million operating loss.

Let's continue with the special products segment on Page 13. Here, you can see that after 6 months, revenue in the Specialty Products segment decreased moderately, which is mainly due to the disposal of the dressing and sauces business in the U.S. from division Freiberger, which was executed in Q2 '24/'25. So all in all, revenues declined moderately from EUR 1.14 billion to EUR 1.1 billion in H1 '25/'26. Coming to operating profit, we also do see a decrease, you can see from EUR 108 million to EUR 71 million. So the operating profit decreased significantly to EUR 71 million in the first half of this fiscal. And this development is mainly due to the rising production cost that we see in these divisions, which could not fully be passed on to customers.

Going forward on Page 14, here you can see the development of CropEnergies segment, so the ethanol business. You can see also -- let me start with the key figures on the right-hand side, you can see that revenues were down from EUR 484 million in H1 '24/'25 to EUR 402 million in this H1 of the current fiscal. And operating profit also turned to the negative from EUR 17 million in H1 '24/'25 to a minus EUR 13 million operating loss in the CropEnergies segment in '25/'26. And the main reason for development in revenues is a decrease in production. So it's not linked to the market development. Ethanol market or the need or the development for biofuels is still pretty stable in the U.S. -- sorry, in the EU. The development of CropEnergies here and on the revenue side was linked to internal reasons. So the decrease is primarily due to significantly lower sales volumes, mainly resulted from both scheduled and also unscheduled maintenance work carried out due to technical issues.

When it comes to the operating profit, so as I said, it turned to a negative and this was significant -- that was due to significantly lower prices in the first half. But we will see when we discuss the outlook further on. We always state that ethanol prices are volatile. There are good reasons given supply/demand in Europe, there are good reasons to -- that prices should increase. That's what we also stated in the quarterly calls we had in prior periods. And we did see this increase finally in the last 10 days, yes, or I would say, last week. So in the last days, ethanol prices have increased significantly in Europe. So this is a positive sign, and this also is reflected in our forecast, which I will discuss at the end of this presentation.

So let's move on to the starch segment. This is on Page 15. You can see also on the right-hand side that after 6 months, revenues in the starch segment declined moderately from EUR 505 million to EUR 474 million in first 6 months of this fiscal. And this was due to the overall decline in prices and volumes. Operating result is significantly below previous year's levels. You can see that it turned downward from EUR 20 million in H1 last year to EUR 5 million this year. On the positive side, in this reporting period, we benefited from an insurance compensation related to the flood damage at the Austrian plant, Pischelsdorf, which we discussed also in recent quarterly calls with you.

Let's move on to the fruit segment. And as I said, this is really positive to note with the Südzucker Group having a robust and resilient portfolio. You can see that the development in the fruit segment is positive compared to prior year's H1. We do see an increase in revenues from EUR 824 million last year to EUR 858 million this year. And the operating result also came in above prior years, reaching EUR 86 -- EUR 68 million. I always mix figure sometimes. So EUR 68 million, you can see in the middle of the right-hand side, EUR 68 million positive.

So let's move on to the remainder of the income statement after having had this look on the segment development, operating profit. So in income statement, you can see that after 6 months below operating profit, the result from restructuring and special items amounted to a minus EUR 33 million versus a plus of EUR 13 million. This was largely attributable to the sugar segment in addition to the special products segment. When it comes to the result from companies consolidated at equity, this also amounted to minus EUR 8 million and is alongside the starch segment and the sugar segment. Looking into the financial result, you see a minus EUR 70 million, which is also higher than last year, where we had stood in the financial result at a minus EUR 51 million.

So what are the reasons for that? There we have to look a different look on both the pure financial interest side and the other financial interest side, when it comes to the pure financial side, when it comes to the interest side, here, we can see that here is a minus EUR 53 million, and this is linked to higher interest expense, which is due to an average increase in interest rates. So for this reporting period, we have an average interest rate of 3.7% compared to a 3.4% in the prior year's period. Net financial debt on average in this period was roughly stable at EUR 1.9 billion, EUR 2 billion. And when it comes to the other financial results, this is mainly attributable to exchange rate losses, which are linked to the weak U.S. dollar and the weaker British pound.

Moving on to the taxes. You can find that on Page 19. So taxes on income in H1 came in with a plus of EUR 9 million compared to a minus of EUR 74 million in the same period of last year. And this is based on earnings before taxes of minus EUR 69 million in the current year versus a EUR 235 million in the first 6 months of '24/'25 fiscal. So finally, we look into earnings per share, not a positive figure and clearly disappointing for us. Earnings per share at the end came in at a minus EUR 0.38 against a plus of EUR 0.61 in the prior year's period.

Let's have a short look on cash flow, working capital investments. You can find that on the following pages. So I start with cash flow on Page 21. You can see in the graph or in the table that due to the decline in operating result, cash flow also decreased in the reporting period now to EUR 67 million compared to EUR 343 million in prior year's period. We do see a decrease in working capital, which is positive. On the investment side, CapEx side, investments into fixed assets reached EUR 219 million. So we are on track with reducing CapEx. And investment in financial assets and acquisitions are not meaningful in size.

When it comes to the financing activities, so Südzucker had been very successful in refinancing our debt position. So here, you can see I have a particular look on the new EUR 700 million hybrid bond, which we issued successfully in May '25. So this is reflected also. You can see that in the cash flow statement. So we issued a new EUR 700 million hybrid bond via our Dutch subsidiary, Südzucker International Finance, to refinance the existing hybrid bond, which was also worth EUR 700 million, which was issued in summer 2025. And the increase and decrease in stakes held in subsidiaries and capital buyback are linked to this transaction.

So we move on to the balance sheet, which you can find in the -- on Page 23. So when it comes to net financial debt, by end of August '25, net financial debt stands at EUR 1.674 billion. The cash inflow from operating activities of EUR 255 million includes, in particular, the cash flow of EUR 67 million and a strong decrease in working capital. And as I said, investments into CapEx amounted to EUR 219 million. So in total, the net financial debt is rather stable compared to the EUR 1.654 billion, where net financial debt stood at the end of last fiscal 29th of February -- 28th of February '25. Equity ratio is still solid. So we stand with an equity ratio of 45%. So this is a solid level.

Let me now turn to the outlook, which you can find on Page 25, 26. So unfortunately, we had to revise downwards our operating profit guidance for the group on August '21. That was the MRR guidance that you have seen. So on August 21, we updated the group guidance for the full fiscal '25/'26, and we expect group revenues to come in between EUR 8.3 billion and EUR 8.7 billion. That's in the middle of the graph down and operating result to reach between EUR 100 million and EUR 200 million. This compares to our previous guidance of EUR 150 million to EUR 300 million. So it's a downward review of our forecast, which we had to do on August 21, but we do confirm this number as of today.

So what has changed compared to our previous guidance before going into the details. So overall, it is unchanged now for the group, but we do see a decrease in the sugar segment. So sugar segment is updated. We have not changed the outlook for special products and starch. We do see right now a slightly better improvement in CropEnergies, and we do see a better development in fruit. So this is also linked to what I've already stated. So it's a robust portfolio, and we have different developments in the different segments.

So coming to sugar. For the sugar segment, operating result is now seen in a range from minus EUR 850 million to minus EUR 250 million. Our previous forecast was between minus EUR 100 million to minus EUR 200 million. So there's an additional burden to be seen given the bearish sentiment on prices, which I just explained of EUR 50 million in sugar segment. special products segment unchanged. We currently expect the operating result to decline significantly due to the anticipated rise in costs, which I have already explained.

For CropEnergies, the development is the following. So in the segment of CropEnergies, we expect significantly weaker revenues. This is due to lower average ethanol prices compared to the previous year as well as technical issues, as just explained, following the scheduled and unscheduled maintenance. At the same time, net raw material costs have gone down compared to previous year. And what is positively to note, ethanol prices in the European market, they have just recently started to rise again, which is positive. All in all, we expect the operating result for Crop Energy segment to be on the same level as last year.

Already stated for starch segment, no change. And for the fruit segment, following an already very successful '24/'25 fiscal, where we now expect a slightly improved operating result compared to the previous year as moderately increased prices are helping to offset the impact of rising costs. So all in all, our group guidance is unchanged compared to the downward revision on August 21, and we do see group revenues in the range of operating profit between EUR 100 million and EUR 200 million.

Looking at the other KPIs for our forecast, you'll find that on Page 26. So for group EBITDA, the range is expected to come in between EUR 470 million and EUR 570 million with the explanations completely true for, as I just stated, in operating profit. Depreciation is expected to be on previous year's level. CapEx is expected to remain below prior year's level. And when it comes to net financial debt, we do project net financial debt to remain rather stable compared to the end of last fiscal.

So ladies and gentlemen, after this review of our H1 figures and the forecast. So as a summary before closing to and coming to the Q&A, I would like to comment that as expected, the challenging market environment in our core sugar segment has continued in the second quarter of this fiscal. Market prices started to improve, but not as much as anticipated. Our nonsugar business continued to be a stabilizing factor. But as a consequence, we had to revise downwards our operating profit forecast for this year in August '25, but we do confirm this outlook as just explained as of today.

When it comes to financing, we are very proud that we have successfully issued this EUR 700 million bond in May, and now we successfully completed our refinancing activities. There is a EUR 500 million senior bond also successfully issued in January '25, and this covers the refinancing of the senior bond maturing end of November 2025. Together with the extended and increased to EUR 800 million syndicated loan, we have established a solid and reliable financing structure for the years ahead. And as I said, I'm very proud of Südzucker and the entire Südzucker finance team who achieved this refinancing over the last months. Also, what is new, but also already communicated for Südzucker Board since October 1, we have Theresa von Fugler on board. We are very happy to have her here with her expertise. And also here from my side and from the entire team, a very warm welcome to her, and we are very much looking forward with her to further work on the success of our Südzucker Group and a very warm welcome to Theresa.

So thank you very much to all of you. So far, we are now happy to take your questions. And together with Andreas, I'm happy to give the answers that you might have to the figures. Thank you very much so far.

[Operator Instructions] The first question comes from the line of Karine Elias from Barclays.

I just wanted to go back to your point on the guidance. So just trying to look at the implied guidance for the second half. Does it imply that the price for sugar or the contracted price for sugar would be probably the decline would be about EUR 100 -- more than about EUR 100 per tonne in the recent contracting. Any color there would be very useful, especially as we think about the start of 2027. And then just going back to your point, I think, on the net debt. Your leverage obviously has picked up. That's partially because of the lower EBITDA. What type of leverage are you comfortable staying in for how long, especially as you think about potential actions from rating actions?

Thank you, Karine, for your questions. When it comes to sugar prices, it is -- I cannot disclose our individual prices. So sugar prices in our market is a competition-sensitive information. So I have -- what I can comment is available market data and just very broadly expectations. What we did say at the beginning of this fiscal when we put up our budget, we stated that when it comes to the sugar availability in Europe, we did foresee a decline. And this decline that we had foreseen was linked to the fact that we, on our side, decreased the acreage significantly by roughly 15%. And then if you look into EU market data, the overall trend for hectares for beets in this sugar marketing year was also decreased by roughly 11%.

So given normal harvest, we would have seen a strong decline in beet availability and the sugar availability in Europe. And this was the base assumption for our assumption that sugar prices should rise. At the end of the day, they really -- they increased, but they did not increase to the extent that we have foreseen originally. And that was the reason why we had to revise downward also the development in the sugar segment. In a nutshell, yes, there is a price increase compared to last year, but not to the extent that we have foreseen because sugar availability and the harvesting conditions, they are much better than we have anticipated.

When it comes to net financial debt, we are -- rating agencies have revised downwards our rating and what are the levels we feel comfortable. This is clearly if net financial debt over cash flow or EBITDA is below 3.5x. We are not yet there, but we work hard on that. And what we feel comfortable is 3.5x, and there's a clear commitment from the Board to investment-grade rating. And so we have put into place the measures to reduce costs. We go into all -- in each every cost position. We do all our best to decrease CapEx, but decreasing CapEx is not so easy because you have ongoing projects with contracts in place. But what we can do to cancel or postpone, we do. And all in all, we strive to come below 3.5x net debt over EBITDA. But it is not the case as of today, but this is our ambition level, yes, clearly.

The next question comes from the line of Hartmut Moers from MATELAN Research.

I have a couple of questions and probably we could go through them one by one. So the first one would be on the sugar segment here. What we find basically in the second quarter is roughly the same level, a bit below the sales level of the first quarter. And I mean, you should have basically a similar price level, at least with regard to the predominant part of your business as your October contracts still lasted into the second quarter. But usually, you tend to have better volumes in the second quarter compared to the first. So one would have -- or one could have thought that your sales increase in the sugar segment in the second quarter compared to the first. So what was the reason here for, yes, being just south of that level?

And you still had quite a number of special items in the sugar segment. How shall we look about that going forward? Meaning would that now something related to the shutdowns you had on the AGRANA side of the business? And is there coming more with regard to the cost optimization measures you're just taking? So how should we look about that going forward? So that's on the sugar segment.

For the volumes and price development in sugar, I tend to rely more on H1 figures than on individual quarters because you can also have some shifts. So for me, the more reliable way to look at it is really H1 as a total. And we do see for the 6 months that there is both a decrease in volumes and a decrease in prices. So we do see that the environment for sugar, there is some volume decreases and also for prices.

H1 versus H1 last year? Or...

Yes, yes, yes. H1 -- to compare H1 to H1. So there, we have lower volumes and lower prices. And the lower volumes, they are across all markets. It's not one particular market or a specific region. So for us, it's an overall trend that we have reduced volumes.

Okay. And going forward, for the coming year, you're staying roughly level in terms of volumes. Is that a fair assumption?

Yes, that's a fair assumption. But we have to see -- we did see some reductions in sugar consumption, for example, in beverages, there's less sugar in beverages. And we also do see, for example, less chocolate sold. This is linked to the fact that cocoa is very expensive. So there is less chocolate sold and thus less sugar into chocolate. These are trends which can change. But for the time being, there's a slight decrease, and we have to monitor that closely.

Okay. Second one would be on...

On restructuring. So within the restructuring side, so this is, as I said, particularly linked to the sugar segment, and this is a follow-up cost of the restructuring we had, for example, with the closure of the 2 plants, Leopolsdorf and Hrušovany, for example.

Okay. But is that finished now? Or shall we plan with further one-off items in the coming quarters?

When it comes to those 2 plants, it's finished. But when it comes to special items coming forward, the issue of special items is that they are not really predictable. So we cannot exclude neither that it's the -- that you will stay that, but it's also possible that additional special items could come up in Q3, Q4. So we have to -- when you do the -- when we'll start to do the planning for the years to come, we have to do our goodwill impairment test and all of that, but this will be then in Q3, Q4. It's too early to say whether there can be additional one-off items, but I cannot exclude them.

Yes. I mean -- but there's nothing scheduled so far. So in terms of cost optimization or something, there's nothing you have in your budgeting right now?

There are some special items also from the first 6 months when it comes to restructuring, when it comes to personnel or severance payments that is possible. So what is executed on the table at the end of August, that means for the first 6 months, this is included. But for sure, there can come additional points can come up in the development of Q3, Q4, I. Cannot exclude, but it's too early to say.

Okay. With regard to CropEnergies, all your technical issues and so on, this is finalized now. So my question would be with regard to capacity utilization. So obviously, you had a rather low capacity utilization in the first half of the year due to these issues. But are we now looking to a more normal level again? Or are there any reasons why your one or the other site might not work at full capacity in the second half of the year?

There's nothing scheduled. And as I said, the market environment for biofuels as a total is positive. This is also the reason why prices have gone up significantly. There was a strong driving season, and there is -- on the months to come, there's nothing particular to see. So I would assume a high capacity utilization unless other technical issues would arise. But from the market perspective, there's good reasons to use fully the equipment we have.

Perfect. And then I would like to come to your outlook, and I'm a bit lost here. So what you're saying compared to what you said on August 21, you have somewhat reduced or specified the range for your sugar segment, which is a bit weaker than what you expected still in August. And you have compensated this with a more positive outlook on the CropEnergies and the fruit side. But looking at the extent of the changes, I would -- I mean, you've upped fruit by one notch, which is maximum of 4%. On Crop, Europe, yes, also EUR 5 million, EUR 6 million, EUR 7 million, so to come to EUR 22 million.

But if I took the midpoint of your new sugar guidance, which would be minus EUR 200 million, it would basically impossible for you under the indications that you have given to reach the midpoint of your group guidance, you would be somewhat below that. And that already would assume that, in particular, starch and special products would also materially improve in the second half of the year, and we would not look at run rates of the current Q2 level. So is what you're saying that we should rather look on your group guidance, not at the midpoint, but rather at the lower end of your guidance? Or how should we interpret this?

Hartmut, as you said, nothing to be confused. It is exactly what you said. So we are -- we confirm the group guidance EUR 100 million to EUR 200 million, and we are slightly -- for the group guidance, we are slightly below midpoint, but close to midpoint, but rather we are not at the lower end, but we are close to midpoint, but slightly below midpoint.

Okay. That's fair. Okay.

And -- but not to an extent which would force us to update the guidance. You know the rules of MRR. So we are close to midpoint, slightly below.

Okay. No, that's, let's say, feasible under the assumption that special products and starch would make a major jump from the Q2 level to the norm, then you arrive exactly what you're saying. But you can confirm that this is the assumption then?

Yes.

In starch and special products, Q3 and Q4 will be significantly better than Q2?

As I stated at the beginning, so we do not give particular ranges or points for the segment. So our main focus is on group level. As I said, it's a robust portfolio. We have different developments in the different segments. And the other thing that is also true, I said, that we believe that Q3 should be the turning point to the better. And all of that, but your analysis is fully correct. We confirm group guidance EUR 100 million to EUR 200 million.

Perfect. Last point would be on the cost optimization measures you mentioned earlier. Could you just give us an update on that? I mean you've already mentioned size, but could you be -- become a bit more precise on the time line? And also, I mean, you have said in the last call that the cost optimization is roughly split 50-50 between sugar and -- between Südzucker and AGRANA. Would you be prepared also to give a split between sugar and nonsugar divisions?

This is unchanged. So this is still true what I said in recent conference calls. We have initiated a lot of cost-saving initiatives. We are here on track. And the different amounts that have already been communicated, we still stick to them. So in total, we strive for savings of EUR 200 million for the Südzucker Group, which are to materialize in the coming years. For this fiscal, it is still our target, and we are on track for EUR 80 million cost savings, which is half of half AGRANA and Südzucker.

AGRANA has the program called NEXT LEVEL. And here, they strive up for savings up to EUR 80 million to EUR 100 million per year starting in '27, '28, so we started. At Südzucker, this program is called OPTIMUM, which drives for EUR 100 million savings in the sugar segment also coming into effect fully in the next 3 years. So we are on track, but it's not that all of the amounts are already visible this year. So this will build up. But in general, we are on track and there's nothing change to previous communications on our cost saving measures.

Okay. But just to make that clear, the EUR 100 million coming from Südzucker are 100% sugar. There's nothing in the other divisions, in your other divisions?

No. In total, we strive for EUR 200 million after 3, let's say, 3 years, and this is EUR 100 million for sugar and EUR 100 million for the others.

[Operator Instructions] We now have a question from the line of Oliver Schwarz from Warburg Research.

May I come back to CropEnergies first. I appreciate that you are flexible enough to notch up your outlook following the increase in ethanol prices. And you already have given some remarks regarding the reasons behind that. However, I guess, driving season should now be over. We still have the problem of U.S. imports into the European market and so on and so forth. So I'm wondering what you think how sustainable this increase is given the overall structural situation the European market is in.

And that would lead me to my second question of your U.K. asset, Ensus. You stated that you are looking for full capacity utilization in the second half of this year. And I guess that very much includes Ensus then. So what's the status of this last remaining asset that the U.K. has? It seems like especially the U.K. market is under heavy pressure given that they have made trade deals with the U.S. that might be less favorable for the U.K. bioethanol industry and one of your competitors has already pulled the plug on his plant. So yours is the only remaining one. And I'm wondering what's the situation there?

And lastly, could you give us an update on your future, let's say, value chain that you are currently trying to expand into chemicals, given that the chemical industry in Europe has a lot of structural problems at the moment and is shrinking. So your upcoming production once those assets currently under construction have started up. I guess your customer base must -- or your potential customer base must have shrunk and those who are still in the game, they currently have problems regarding their there -- when it comes to pushing their volumes in the market. So how welcome will your product be coming in addition to what's already available in the market? That would be my 3 questions on CropEnergies.

For ethanol prices, so when you look into the fiscal, so we had ethanol prices between, let's say, roughly EUR 600 quite stable over the last -- since the start of this fiscal. So starting with EUR 700, our first forecast was to see EUR 700 and plus, but prices, in fact, decreased to roughly EUR 600 over -- since the beginning of this fiscal. And what we did see over the last -- it started in September, but materialized in October. Now the prices have jumped over EUR 800.

If you now ask me whether I believe this is to continue, I just have to say you, I cannot give you a promise because we see, as we always state, ethanol prices are volatile. For sure, there is always the risk of major changes, be it on the tax side, be it on the import side, be it on bilateral agreements between countries. So it's really difficult to predict. But for the time being, we see EUR 800. If you look into the forward curve, there's still a backwardation. So the anticipation is that this EUR 800 is not to last. But there are good reasons also when I look into supply and demand, there is not too much volume in ARA, Antwerp, Rotterdam region.

So I believe that prices should be supportive, but I cannot give you a guarantee. It is still volatile market. It's commodity market. It will depend on factors. But from the supply and demand side or especially from the demand side, there's robust demand for ethanol. But I guess for sure, there's no guarantee. We are very happy with the price increase to be seen how long and to which extent this will last, but we have taken this into our forecast to a certain extent with a better price assumptions that we have seen so far.

When it comes to Ensus, when I said we strive for a full capacity utilization, there's a question mark still on Ensus. So the negotiations with the U.K. government on a support package are still ongoing. I cannot disclose any details. We are confident because we believe Ensus is really significant to U.K. industry, be it on the ethanol side, but also on the CO2 side and the co-product side. So it's an important player in the industrial landscape of Britain. So we hope that the discussions or the negotiations with the government would find a positive end, but I cannot disclose and it's not finally done, but you have seen that the competitor has stated to stop production. We are still in negotiations with the government. So there's a question mark on Ensus.

Your third question was on bio-based chemicals. Here also -- it is true, your concern comes from the point that climate mitigation measures are under discussion. This started with the Trump administration putting into question climate change and focusing much more on fossil fuels. For sure, this is at present a trend or a downward trend for climate protection measures, but this does not lead us to change our strategy. We still believe we need green carbon hydrates. We have to get rid of fossil fuels, be it in the transport sector, be it in chemistry, and we continue with our project as foreseen. So start of operations is to come as foreseen, and we do have still positive discussions with potential customers.

The product that we want to produce is [Foreign Language] which is a solvent, which is needed for many also very interesting products, be it solvents, be it paintings, be it coatings, be it [ nakeva ], fluid adhesives. It goes into nail polish, nail polisher and thane. So this is really interesting products and our customers, they also have very much interest in having this green product. So there's no change in our strategy. But we -- I confirm the overall framework for climate mitigation measures has changed, but I believe this to be not a continuous trend because I think we will all have to do our best to reduce our carbon footprint, and we will continue to do so.

The next question comes from the line of Setu Sharda from Barclays.

So my question is, what was the achieved average price in sugar marketing this year? And was it in line or lower versus last year? And what is your exposure to spot prices move over the course of the next 12 months?

Setu, as I stated, I cannot disclose Südzucker sugar prices because we are in a commodity market. And for competition or reasons, I cannot disclose any precise numbers on sugar prices of Südzucker. As an overall trend, and you will find that in our investor slide deck you have to rely on available market data. And what you can see is both from the world market sugar prices, there is a downward trend since the beginning of the fiscal, and the same is true for European sugar prices. They have declined significantly. And based on the European sugar prices, you can make your calculations for Südzucker Group because typically, our prices very much rely on European sugar prices, but I cannot disclose individual Südzucker sugar prices.

Okay. And what is your exposure to spot prices, like how much you have contracted this year?

Our exposure to spot prices is not meaningful insight because typically, we do 1-year contracts with customers. Those customers do foresee a certain flexibility in volumes. So we have a certain development. It also depends on some regions have more spot contracts than others. But all in all, spot contracts or spot volumes are not meaningful in size. We do have yearly contracts.

Okay. And one more thing, like can you give some color on what has changed in sugar production, your expectation versus Q1 stage? Like there was a mention that you expect better harvest.

Yes. So when it comes to Europe, that's what you have seen on -- if we go back to -- on Page 11 for Europe, it is foreseen that production should come out in '25/'26 at 15.9 million tonnes compared to 17.0 million tonnes in last year. So there is a reduction in European -- there's a reduction in European sugar production. And what has changed is the extent of this decrease. I would have assumed or we have assumed when setting up our budget, we have assumed a stronger decrease and this stronger decrease was based on the fact that we knew from our side that we decreased significantly the acreage in our regions. And for overall Europe, the decrease in acreage was 11%. That was the number that was known, let's say, in March, April when we set up our budget.

And that means given a normal harvesting conditions, so let's say, for example, based on the average of the last 5 years, this would have led to a significant decrease in beet and thus sugar production. What has changed and then what we also anticipated leading to reasons for lower sugar production was the diseases that we have seen last year. So one is called Stolbur, the other in SBR, Syndrome Basses Richesses. And what we also have included in our initial forecast was a very dry summer. That of course we called it at the time when we last discussed, we called it our 75-percentage scenario when setting up the budget in March, April, the projections for the weather conditions in summer indicated a very dry and hot summer. And this would have led to the fact that also the protection measures would not have been very effective or it was unclear to which extent those measures would have been effective. And this led us to our initial forecast with a much lower sugar production.

At the end of the day, when this is now what has changed, July came out very wet and cold. That was beneficial to the beets. The same was true for August. Here, the weather conditions have shown sunny days and rainy days and cold nights, and this is the perfect mix for the beets. So what we do see today, and this is not what we have expected, we do see a very good harvesting conditions in Europe. So there's much more beet and solid beet and without diseases available for this sugar campaign, and this was not what we had anticipated in our initial budget. So it's positive for the farmers. But given it leads to a much better sugar availability in Europe, this has brought us a bearish sentiment on the prices. And this was the reason why at the end of the day, we had to decrease our forecast for the sugar segment.

We have a follow-up question from the line of Oliver Schwarz from Warburg Research.

Actually, it's more than one. I'm sorry about that, but hopefully, I can...

We still have time, Oliver, no problem.

Quickly talk you through all of my questions. Sorry for that. Firstly, starch. You're talking about higher raw material costs, given grain prices have declined due to -- we didn't only have a strong harvest in sugar, but also all other crops seem to be affected. Positive volume development all over the place, and that obviously also puts pressure on grain prices. Still in starch, you're talking about higher raw material costs, which makes me wonder, is that still, let's say, a remnant of hedging in regard to raw material costs that will tail off over time? Or why is that?

Yes. As I stated, so in H1, compared to H1 previous year, we do see higher raw material and energy costs in starch segment. So this is true for the corn prices. This is true for the wheat prices, and this is also true for the energy. It is true what you said that when you look at market quotations, grain prices have come down, but there's also always a question of hedging, what hedging positions do you have? This can have an impact. So I cannot disclose all the details, but hedging can have an impact. And also, it has an impact in the regions where you buy your grain or corn or whatever.

So market is always the price in Rouen, France. And typically, you have plus and minuses in different regions. And so this can lead to the fact that even if raw market prices go down, you can have different prices depending on availability in certain regions or quality in certain regions. So this -- all in all, this led to the fact that for the starch segment, unfortunately, we do see compared to H1 last year, higher raw material costs in all the 3 segments. It's true for corn, it's true for wheat and it's true for energy.

Will that be true also for H2? Or is this trend to reverse in H2?

I don't have that figure in mind. Sorry. We will have to see. I mean, we have the full year guidance, but I do not have on hand the different assumptions for those cost components for starch. I don't -- we can have a look, but I think here, I don't have that with me.

Yes, I get that. But if it's solely, let's say, a function of your hedging position, I guess you should have an insight on that. But we can do that at a later stage, no problem at all. Second question is on fruit. Obviously, the bright spot in your portfolio at the moment. When looking at the sales development and looking at the comments on volumes, it seems like more or less stable volumes. The sales are not greatly up, which indicates that prices are mostly unchanged as well. So this increase in profitability must have had something to do with lower costs. Is that a result of cost-cutting measures? So is that something that is company specific? Or is that lower raw material costs that might have to be passed on over time to customers?

There's not one answer putting everything into -- or one silver bullet answering everything. So because we have to -- when we talk about fruit, there are 2 divisions. So one division is fruit preparation, the other one is fruit concentrates. And the developments in those divisions is not parallel. It's -- both of them are positive, show an increase in operating profit and in turnover, but the development within the cost positions is different.

Your question, for sure, we do all to -- as entire Südzucker, we do all to reduce administration costs and so. So there's one aspect of that into that. But particularly for the fruit, we do have also increase in material costs. So this is still true. This is true for fruit preparation. So there is an upward trend for those fruit components that we buy. And the same is true for -- in the concentrates business, also the fruit concentrates, they show an increase in material prices. And -- but we have a good development on the pricing situation and on the other costs. So it's a mix of all, but it's not one explanation that fits for all of the divisions. But in general, material prices go up.

Okay. And perhaps can you -- I know it's perhaps a bit delayed now, but can you share about your key thoughts about, let's say, the exchange of your hybrid bond? Obviously, the new hybrid bond is a bit more expensive than the old one was when it comes to the coupon. You had costs regarding issuing the bond and also costs in regarding to buy the old hybrid bond back. So there needs to be an upside somewhere. And given that we are looking for interest rates to rather go down than go up, at least that's my takeaway from the market at the moment.

It seems like the only caveat that is out there is that the new bond doesn't have this operating cash flow covenant that the old one had, which basically implies that you might not be that confident with future operating cash flow development so that some breach of that covenant might be or might have been in the cards in the foreseeable future. That would be my takeaway. But I guess you can easily talk me out of that assumption and give me a better reason for that exchange.

Oliver, I wouldn't subscribe to that fully. For us, the main reason really was that the old hybrid was stated from 2005 and was at the time, one of the first ones, but now was also the last one. So it was my objective to really to modernize the entire financial situation of the balance sheet. That means I wanted to review and modernize together with my team, the entire financing. This is -- you have to put this into context of the entire refinancing. We did more than EUR 2 billion refinancing in the last months. So this was very successfully.

We issued, as I said, the new EUR 500 million senior bond. We did modernize the revolving credit facility with our core banks, increasing that from EUR 600 million to EUR 800 million. We did -- we still have in place the -- with the -- sorry, -- the commercial paper, EUR 60 million is still in place. We have the senior bond. We have the hybrid bond. We put into place a factoring program. So we modernized everything. And part of this modernization was the hybrid, and I'm very happy to have this new EUR 700 million hybrid bond now on the balance sheet, which is fully in line with all the other hybrid bond structures, which we see. So it's part of a modernization of the entire balance sheet. And this really puts us in a good position going forward. The entire refinancing is done, and so this is positive.

I get that modernization sounds very positive. And -- but what is actually the advantage for Südzucker from the new hybrid bond versus the old one? What is in those terms, more modern than the old one was?

The modernization of the hybrid bond now it's fully in line with all the other hybrid basis. So it has no more a cash flow trigger. It has -- so it's fully in line with the others. And for sure, this is an advantage not having the cash flow trigger.

Okay. So it is the cash flow trigger that is the advantage, not to have it?

That's what you said. That's not what I said.

What did you...

Okay. Let's leave it like that.

Okay. And lastly, and I promise that's my last question. Could you talk me through the bridge from the EBITDA to expected net debt level? Given the fact that after the first 6 months of the current fiscal year, we saw an increase in net debt by, give or take, EUR 20 million. You are aiming for a net debt level of EUR 1.630 billion, which is basically currently around EUR 40 million lower than the current level.

Your guidance is out of EUR 100 million to EUR 200 million for the full year. So that gives you a EUR 50 million to EUR 150 million additional EBIT for the full year. Could you talk me through that, that stable -- the bridge from that increasing EBIT, especially in the second half of this year to the changes in net debt. Are we expected to see an increase, so some reversal of working capital in the second half of this year, especially as Südzucker tends to pay its sugar beet farmers for the harvest in the second half of this year?

So this is Andreas speaking. Maybe I can comment on -- when it comes to the operating cash flow to start there, as you indicated, results are down, but we are also expecting a significant reduction, which already started in the first half, a significant reduction in our net working capital. You have also seen that within the first half year, the CapEx levels are lower than in previous years. That trend should continue also in the second half of the current fiscal year. And the combination of those things should come out in a way that our net financial debt position by the end of the year, we expect to be rather in the ballpark of what we had by the end of 2024, 2025. So the lower operating result should be compensated basically by the net working capital. And obviously, the dividends when it comes to what we paid on dividends this year, it's also a lower -- much lower number than in previous years.

Okay. Maybe I didn't make myself clear that much. Sorry for that. I was specifically asking for the developments in H2. You've got EUR 50 million, let's say, EBIT under your belt, give or take, for the first half year. Your guidance is out there for EUR 100 million to EUR 200 million. That gives you a residual number for the second half year of EUR 50 million to EUR 150 million in EBIT. Your -- currently, your net debt is up compared to the beginning of the fiscal year by EUR 40 million. But by the end of the fiscal year, we are looking for basically the same level as last year. And I was just wondering how does that compute given that you just said CapEx will be lower compared to last year and working capital releases might continue in the second half of this year. How does that compute with coming up with a net financial debt on the same level as last year?

The continue -- so we expect a continuation of our working capital, let's say, improvement process that we indicated that we already started, and that should contribute or this is our expectation that this contributes to the offsetting the low operating results. And again, when it comes to CapEx, also in the second half of this year, it's -- the number is not as significant. Dividends are already paid. So when it comes to the balance of our net debt position, that is in line with what we see in the numbers.

Yes. Maybe -- Oliver, we are running out of time. So maybe we can postpone it to a later moment. But what you can take is for the minutes, we do foresee that net financial debt at the end of this fiscal should be roughly in line with last year.

Yes. But isn't that very conservative? Shouldn't it be below [indiscernible]

Yes, but I think we have to stop it. I mean we -- our assumption is at the end of the day, we strive for having net financial debt on the same level like last year.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Andreas Rothe for any closing remarks.

Thank you very much, and thank you very much to all of you for your participation and your interest in Südzucker. Also, thank you very much for your questions. As Stephan already indicated, when it comes to additional questions that should come up in the aftermath of this call, we, as the Investor Relations department are always available via phone or e-mail at any time. And obviously, we are trying our best to come back to you as quick and fast as possible.

Presentation of the Q3 figures will be held in the beginning of January 2026. And until then, I wish you all the best. Stay safe and take care, and talk to you soon.

Thank you very much.

Good morning, ladies and gentlemen. We welcome all of you to our conference call this morning. The underlying presentation for the call has been published this morning on our website. Today, we released the statement for the first 3 months of the financial year 2025-'26. We are going to present the highlights of this period, and we will also revisit our full year group earnings guidance for the business year 2025, '26, which is unchanged. Following the presentation, we are going to answer your questions. A recording of this call will be available on our homepage shortly after the call.

Now let me hand over to our CFO, Dr. Stephan Meeder.

Thank you, Nathild and Andreas for the introduction. So ladies and gentlemen, also a warm welcome to all of you from my side, and thank you very much for your interest in Südzucker. First of all, please let me give you a brief update on some personal and organizational changes within Südzucker.

Starting end of June, we have a new corporate structure, and this led to some personal changes. And that's what I would like to introduce to you, Andreas Rothe, which is our new Head of Investor Relations. And we have [indiscernible] merged the 2 functions, Finance and Investor Relations under the lead of [indiscernible] Corporate Director Finance and IR and our colleague, Nikolai Baltruschat, which we have known or know for years, and which did a tremendous job here in Investor Relations, has moved over to another very important function, which is being Corporate Director for Strategy and M&A.

And so in this transition phase, Nikolai and his team are also helping in the background to guarantee and organize a good transition to the new team. And we are very much looking forward to do this together with the same quality that we have in the past. And so there's no material change, just the person have changed, but there will be the same approach to Investor Relations as we have done successfully with Nikolai and team over the years. And I want also to express my gratitude to Nikolai and his team for this tremendous work in Investor Relations over the last years.

So going forward, as mentioned, I would like to give you a brief overview about the business performance in the first 3 months of fiscal '25-'26 and the details about our confirmed earnings guidance for fiscal -- for the full year '25-'26. So let's start on Page 5, please. Here, you can see that the Q1 performance was weak. We have to admit that. So it was already communicated on the 11th of April that Q1 performance was not able or was expected not to be able to match with the previous year's numbers, and this has been confirmed in line with our expectations. So after 3 months, we have reached the following numbers.

You can see on top of the slide, group revenues came in at EUR 2.2 billion, significantly below previous year's levels. When it comes to EBITDA, also group EBITDA was significantly down by 58% to EUR 96 million and group operating results only reached EUR 22 million versus EUR 155 million in Q1 of '24-'25 fiscal year. Unfortunately, also cash flow decreased from EUR 178 million to EUR 36 million. And so finally, we came out with an EPS after 3 months at minus EUR 0.18 against plus EUR 0.36 last year.

Net financial debt at end of May, so end of Q1 came in at EUR 116 million above prior year's level and EUR 101 million against the end of financial year '24-'25, which, as you know, is end of '25.

So now let's have a look on the segmental business performance on Page 6. And here, I would like to start with the group revenues already mentioned. So group revenues came in significantly below previous year's levels. As you can see in the segmental split, the revenues have declined in the Sugar segment, in special products segment, in CropEnergies segment and starch segment in 4 out of 5 segments. But also to note positively, it has grown moderately in the fruit segment.

When it comes to the operating profit, you can see the operating group result decreased was mainly driven by the sugar, but also was below prior year in special products for [ CropEnergies ] and starch segment. And you can see in the figures that even in sugar and CropEnergies segment, we are even in a loss situation in the first 3 months of this fiscal. Positively to note the fruit segment had a good development and has shown an increase in operating profit.

So let's move on within the segmental information to segment sugar. You can find that on Page 8. And first of all, let me please revisit the view on the global sugar market because this is important for the price development. And here, most recently in its July '25 estimate of the global sugar balance for the '24-'25 sugar marketing year, S&P Global Commodity Insights forecast a deficit of 4.7 million tonnes. So this is positive, should be supported for the price development. And just as a remainder, the sugar marketing here, when I talk about sugar marketing here, this is always the period starting 1st of October ending end of September. So we just discussed the sugar marketing year '24-'25. So this is the period between 1st of October '24 until 30th of September '25.

So this deficit is driven by declining production, in particular in India and Brazil and a rising consumption. So this is also positive if you have a short look on the gray bars, you will see that over the years, sugar consumption worldwide is still slightly growing with a CAGR of approximately [ 1.6% ].

For the upcoming sugar marketing year starting 1st of October '25, the sugar marketing year '25-'26, S&P Global projects a surplus of 2.9 million tonnes based on increased production mainly in India and Thailand and also a continued growth consumption. So for sure, this is a prediction of a surplus is not positive for the price development. But nevertheless, it's important to note that for '25-'26, there is still time to go. It's weather market, a lot of things can change. But for the time being, for the upcoming '25-'26 sugar marketing year, is predicted a surplus of 2.1 million tonnes.

So this has effects on the world market prices. So if we have the world market prices for sugar was around EUR 500 per tonne at the beginning of our '25-'26 fiscal year, then it initially rose to approximately EUR 520. So this positive upward trend was fully in line with our expectations. But then this was against our initial expectations. The sugar world market price declined in the meantime to about EUR 420 per tonne. And at the end of May '25, the world market price stood at EUR 422 per tonne.

So this starts from the world sugar market. Let's have a look on the EU market. You will find this on Page 9. Here, for the upcoming sugar marketing year '25-'26, starting 1st of October, the EU Commission and a significant decline in cultivation area. So this should be supportive for the prices. And based on this production, including inventory growth is forecast to decrease to 15.7 million after 17.1 million tonnes in prior sugar marketing year. So this decrease in production forecast should be supported for prices. And as a result of this balance, the EU is expected to become in return a net importer of sugar.

An important issue is for us always to monitor closely the situation on Ukraine because as we have discussed over the last conference calls, the significant price decrease that we have seen over the last fiscal, that was also mainly due to the imports from Ukraine and what is the current situation. Here in early June '25, the quota for duty-free sugar imports from Ukraine was reduced to the original level that in the 2014 association agreement that means to around 20,000 tonnes per year. And this regulation will remain in place until a new agreement is reached. So that means specifically for the period between June 5, '25 and December 31,'25, Ukraine can only export [indiscernible] 700 tonnes of sugar duty-free to the EU.

So this is not significant in volume. So this is a positive news for the rest of this calendar year. But discussions with Ukraine are ongoing and recent news that we have seen or that you could also read in the press that there's a new agreement under discussion. And here for this new agreement, which will start 1st of Jan '26. Here, the EU Commission has proposed a quote of 100,000 tonnes per year to the Ukraine, so 5x the current volumes.

And as you can understand, we are opposed to this proposal. It's not be [indiscernible] solidary with Ukraine, but this is additional volumes that are not needed for the European market and Ukraine has always been traditionally exporting their volumes to, let's say, Africa and other countries like Asia and some Arab countries. So we should support Ukraine in doing those exports, but those Ukraine volumes are not on the European market. But the further development has to be monitored closely to what extent this will influence the EU market, and the respective pricing has to be seen.

So let's continue with the numbers in the sugar segment. You can find that on Page 10. So here is the overview of revenues, EBITDA equation operating results. So after 3 months, revenues in the sugar segment came in significantly below previous year's level. Prices in EU fell more and more sharply over the course of the previous fiscal year, which we have already discussed, and they continued to drop slightly further at the beginning of the new fiscal '25-'26.

We expect sugar prices to increase. As I just said, this is linked to the fact with the reduced acreage and the harvesting prospects, and we expect prices to increase in the new sugar marketing year starting October -- 1st of October 2025.

When it comes to operating results, you see a loss of EUR 56 million. So the operating profit or the operating result [indiscernible] negative, it shows a strong decline. So during the first quarter of '25-'26 fiscal, the sugar segment recorded an operating loss of EUR 56 million compared to a positive of EUR 59 million in the corresponding prior period. And the significant decline in results was mainly caused by the sharp downturn in prices, which could not be absorbed by lower manufacturing costs in the '24 campaign.

So let's move on to Page 11. Here, you can find an overview on the segment special products. Also here in the table, you can find revenues, EBITDA, depreciation, operating result of the first 2 months. You can see that after 3 months, revenues in the special products segment decreased moderately. This was mainly due to the disposal of the dressings and sauces business in the U.S., which was sold by Freiberger in Q2 of the prior year fiscal '24-'25.

And you can also see a decline in operating results. Here, the operating result decreased significantly. This development is due to rising production costs, which we could not fully pass on to our customers fully.

Following special products segment, let's move on to CropEnergies segment, which you can find on Page 12. You can see after 3 months, revenues in CropEnergies segment were down significantly also. The decrease is due to significantly lower prices for ethanol as well as the co-products for food and animal feed products. Volumes also decreased compared to prior year's level due to scheduled maintenance.

Coming to operating results, you can see here, unfortunately, CropEnergies had to account for a loss in the first 3 months. So operating result was also significantly lower than last year. And the key factors here for the decrease in results are the already mentioned sales price volumes going down, which were both lower than the previous year. In addition to, we had higher net raw material costs, which led to a negative operating result in the first quarter of '25-'26 [indiscernible] you can see here minus EUR 5 million. And looking ahead, maintenance shutdowns are expected to weigh on operating earnings until mid of July '25.

After CropEnergies segment, let's move on to the starch segment, and you will find it on Page 13. And here, you can see that after 3 months, revenues in starch segment also declined this time slightly to EUR 245 million due to slightly lower prices and volumes. And those slightly lower prices and volumes also led to a decrease in the operating result. You can see that starch segment finally turned out with an operating profit of EUR 3 million in the first 3 months. And this was, as I said, due to slightly lower prices and volumes as well as to higher raw material costs.

On the positive side, here in this reporting period, we benefited from an insurance compensation related to the flood damage in Pischelsdorf, Austria in autumn '24. You remember for sure the really strong negative figures of this tremendous flooding that we had in Pischelsdorf with the tremendous work of the team to get the plants back on track. And in Q1 this year, we received this insurance compensation.

Let's move on finally to the fruit segment. You will find the fruit segment on Page 14. So this is the positive development in Q1 of this year, you can see that both on the revenue side and also in operating profit, we see here an increase. When it comes first with revenues, you can see that we have here a moderate increase from EUR 415 million to EUR 444 million in the current year. And this development is particularly due to good volumes and prices in both fruit preparation and fruit juice concentrates divisions.

Operating result came out at EUR 36 million after EUR 27 million. So here is an increase and the margin of fruit prep was substantially increased, as I said, due to good volumes and pricing. The earnings contribution from fruit juice concentrates also improved due to a higher margin.

Let's move on after operating profit and view on the 5 segments, what is the remainder of the profit and loss. You will find this on Page 16 and 17. I start on Page 16. Here, you can see that after 3 months, the result from restructuring and special items amounted to minus EUR 23 million versus EUR 2 million in previous year's period, and this was largely attributed to the sugar segment in the context of the closure of the plants in [ Bienenbüttel ] and Pischelsdorf.

The result from company's consolidated equity was derived from starch segment in total to minus EUR 6 million. And looking to the financial result, you can see minus EUR 32 million above prior year period. And so in this EUR 32 net financial result negative is -- the major part is the net interest expense amounting to EUR 27 million and the remainder is the other financial result of minus EUR 5 million linked to exchange rate changes in context of the foreign currency loans of non-Euro companies.

Let's continue on Page 17. Here, we can have a look on taxes on income and earnings per share. Taxes on income came in at plus EUR 4 million compared to minus EUR 38 million in the same period last year. This is based on earnings before taxes of minus EUR 39 million versus EUR 132 million positive in Q1 '24-'25. So finally, as already stated, earnings per share came in at minus EUR 0.18 against plus EUR 0.36 in the prior year period.

Let's continue with the balance sheet items and the other KPIs. So starting with cash flow, working capital and investments. You will find this on Page 19. On Page 19, we start with the cash flow statement. You can see top of the list that due to the decline in operating profit, cash flow decreased also significantly in the reporting period to EUR 36 million after EUR 178 million in the prior year period.

When it comes to working capital, we see here an increase. So this increased by EUR 44 million after EUR 114 million inflow in Q1 of last year, and this development was due in particular to the sale of sugar inventories and the offsetting beet payments.

Investments are pretty stable in the first 3 months, have reached EUR 150 million in investments in CapEx against EUR 130 million last year. Having a look on the financing side, in May '25, Südzucker, we have successfully issued a new EUR 700 million hybrid bond via our Dutch subsidiary, Südzucker International Finance DV to refinance the existing hybrid bond also worth EUR 700 million, which was issued 20 years ago in summer of 2005. And this issue is reflected here in the increase and decrease in stakes held by subsidiaries of respectively capital buyback. So this effect is in here.

When it comes to the increase, so the increase is minus EUR 277 million, and this is due to the pro rata repayment of the 2005 hybrid bond as part of the buyback offer. Which serves as a component of equity and full repayment of the old bond was made on June 30, '25 as part of the notice of termination. The decrease that you can see of plus EUR 693 million was attributed to the new bond, as just explained in May '25 issue. So the decrease is issued to that after deduction of the cost with a nominal of EUR 700 million.

Coming to the balance sheet, you will find that on Page 21. No significant changes. So I'm pretty short on that. So key issue is net financial debt came out at EUR 1.755 billion and equity ratio is pretty stable and at a good level still at 43%.

So coming to the outlook for fiscal '25-'26, you will find this on Pages 23 through 25. I start on Page 23. Here, you can see the group guidance and the segmental information. So for fiscal '25-'26, we expect group revenues to come in between EUR 8.7 billion and EUR 9.2 billion. So this is unchanged. Also operating profit on a group level is unchanged at EUR 150 million to EUR 300 million operating profit.

So let's have a look on the development. So in view of the full '25-'26 financial year, we have already anticipated that the first quarter would be comparatively weak. So this is confirmed as of today, but fully in line with our view on this quarter and the months before. So therefore, our outlook for the operating result remains unchanged within the previously communicated range of EUR 150 million to EUR 300 million. So this is unchanged.

Yesterday, we communicated to the capital market through an ad hoc announcement that our expectations for the second quarter are lower than in Q2 of last year. However, we still confirm our full year outlook remains unchanged.

So coming to the full year outlook in the segmental information, starting with sugar. So for sugar, we see operating result in a range between minus EUR 100 million to minus EUR 200 million. In the segment special products here, the operating result is expected to come in moderately below the previous year's level. And as I said, we had some changes in the segmental information. So there's a change in prospects for CropEnergies segment. So due to weaker revenues and shutdown-related costs in the segment of CropEnergies, the operating result is now expected to come in significantly below prior year level and a significant decline in operating is also anticipated is [indiscernible] for the starch segment. So for both CropEnergies and starch, this is below our initial guidance.

On the contrast on the positive side, there is a better view on the fruit segment. So after a very strong performance of the fruit segment in '24-'25, we expect that despite rising costs, the operating result remains stable in the fruit segment, which we previously forecasted to be significantly below the prior year. So in a nutshell, we see we confirm our full year guidance with operating profit for the group between EUR 150 million and EUR 300 million. This view is unchanged for sugar. And we see a not so strong development in CropEnergies and starch segment, but a better development in fruit as previously forecasted, and that means after this intersegmental changes, all in all, our group guidance remains unchanged.

On Page 24, let's have a look on the remainder of our financial KPIs within our outlook for '25-'26. You can see all of this is unchanged, but you can see on this slide. So for EBITDA, we expect EBITDA to come in between EUR 525 million and EUR 675 million. For depreciation, we foresee that is on previous year's level. CapEx is to be expected to be below prior year's level. And all of this, as I said, is unchanged to our initial full year guidance.

Same is true for the remainder of our KPIs. When it comes to capital employed, this is still expected to remain on the same level as in prior years, whereas on ROCE, given the decrease in operating profit, we foresee a ROCE significantly below prior year.

Net financial debt should develop positively for the remainder of '25-'26 fiscal and is expected to come in below '24-'25 number. The ratio of net financial debt to cash flow as well our equity ratio expected to remain stable. And all of this is also unchanged compared to our initial guidance.

So ladies and gentlemen, coming to an end, you have seen and, you know us for years. So volatility is a key element of our business. We know that, and it is an ongoing challenge for sure, especially in our core sugar business. And what we see, and we have also seen this over the last period, the market reacts very sensitively to factors such as production levels or demand and the supply situation in Europe and the weather conditions, harvesting conditions.

And unfortunately, this was the case in the previous financial year, where the decline in prices was followed by a significant drop in earnings in our sugar segment. Unfortunately, this development has continued into the first quarter as well as to the second quarter as we have announced yesterday.

And so -- but positively to be noted that our non-sugar business continues to be a stabilizing factor and generates in total around 60% of our group's revenue and demonstrates that despite various external factors and the volatility that we cannot exclude, our company is now significantly more resilient and better positioned than it was just some years ago.

And we are in a transformation process. We want to strengthen all of our strategy [indiscernible] we are in a transformation process positively. And it's clear this requires also strong leadership. And in this context, I'm very pleased or we are very pleased to announce the appointment of Dr. Theresa von Fugler to the Executive Board. You have already read this in our press release. This is dated July 3, and we have communicated that Theresa is joining Südzucker and with her commitment to sustainability and transformation also with a strong expertise in consumer markets and leadership experience, we will greatly enrich our company.

This having said, we also have a look what we have done recently on the refinancing schedule. You will have seen that in January, we have successfully placed a EUR 500 million corporate bond refinancing the bond maturing in November '25. As -- or as we have seen in the cash flow statement, we have in May this year, took further steps to modernize our financing structure with the refinancing of the EUR 700 million hybrid bond. And what we also did successfully is we increased our syndicated loan with 12 of our core banks, summing up to EUR 800 million.

So this strong shows a strong commitment and the confidence from the capital markets. In total, we have successfully refinanced a total of EUR 2 billion, ensuring a solid financing structure of Südzucker going forward. As such, we consider ourselves being well prepared for the challenges ahead and remain confident in our ability to proactively shape the future.

Thank you very much to all of you for your attention. And together with Andreas, I'm now happy to take your questions. Thank you so far.

[Operator Instructions] The first question comes from the line of Daniel Baum from HSBC.

Would you be able to provide a bit of an update as to how the weaker dollar is impacting your group revenues? Secondly, could you provide a bit more context as to the market tightening thesis because there's conflicting sources out there. And based on some of the analysis I've done, it seems unlikely that there's going to be the material tightening and some of the guidance you provided does look a little bit towards the optimistic point even at the sort of mid to lower range of the EBITDA range.

And then thirdly, are you fully committed to paying the current expected dividend as per consensus, just given that you're -- even with the working capital inflow you're expecting, you're probably going to be burning a couple of hundred million euros of cash this year?

I can start with the -- I didn't fully get the second question. So I will come back to. I can start with the weaker U.S. dollar. So the main effect of the weaker dollar makes for some import pressure on the ethanol side. So ethanol is predominantly -- the main currency for ethanol is the U.S. dollar. That means the U.S. dollar makes translated to you the imports more attractive. So this is a negatively weighing factor on the import side. The second question, I didn't fully get. Andreas, you get the question?

I think it was related to the expected quantities for the sugar market. Is that correct?

You said something about tightening, but I really didn't fully get the question. Yes. Please repeat the second question, please.

I've done a fair bit of work on the sugar cycle, and I can't really get to some of the tightening thesis that you seem to be presenting. And as such, it feels like the EBIT -- sorry, the guidance for EBITDA is still too high. Can you maybe tell me what I might be missing because it seems to be delayed quarter-on-quarter. And again, I just -- I don't really get the acreage math to map up with what you're saying.

I can do that. But again, the question, what do you mean by tightening? You mean reduced sugar prices or the negative sentiment on the sugar prices? That's the background of your question.

Lower supply, higher price...

Lower supply. Okay. Okay. The lower supply, this is linked -- this is an issue for Europe. So in Europe, we at Südzucker, we have decreased the acreage. That means the planting, which starts in March has been reduced significantly. So there are less -- in Europe, there are less sugar beets being [indiscernible] in March. And that means just given this lower acreage, which is for the Südzucker, approximately, we have decreased acreage by 15%.

And if you look into official figures from Standard & Poor's, for example, when it comes to the cultivation area of sugar beets in Europe for this campaign, which will start in September, the average is minus 10% in Europe. That means if there are 2 ways going forward. So what we already know is a decreased acreage that going forward, that means if the yields on these acreages are on average like last year, then the availability of sugar is roughly 10% lower.

If in addition, and this is base case for our assumptions for the pricing, if there will be droughts in a really very hot summer going over the next 2 months. And this is if you look into the metrology artificial AI systems or the predictions, so 75% probability is for very hot and dry summer. And this would mean that the years of sugar beets and that they could suffer from this drought and this would lead given the, let's say, roughly 10% decrease in acreage on top of a difficult harvest or cultivation situation for the next, let's say, 2 months going forward, this would lead to a lower -- much lower availability of sugar in Europe, and this should be supported for the price, and that is what we have factored in our forecast for sugar.

For sure, if there will be massive rainfalls or always the change between good rainfalls, good sunny days, cold evenings or cold nights and also the beet can develop positively, but this is not our base case assumptions. We foresee rather a difficult summer weather conditions, but there's no guarantee on that. I just explained, this is our base case assumptions. We will have to see by the end of August, starting of September, how finally this 2 months to come will have been being and then we can have a clearer look on the harvesting situation, that means the availability of sugar.

But in our base case scenario, we foresee a difficult supply situation for sugar for this campaign 2025.

And then just third question...

Dividend? So our dividend proposal, we will have our general assembly next week. So the dividend proposal is EUR 0.20. So this is clearly below prior year's number, which was at EUR 0.90. And this takes into consideration the overall framework that we are. We have an increase of net financial debt. The prospects for our forecast are let's say, moderate. In this context, we also decreased the dividend because we have so many measures in the group [indiscernible], we need to be prudent, and we need to be conservative, and that's also why we have proposed to the general assembly a dividend of, let's say, only EUR 0.20.

The next question comes from the line of Karine Elias from Barclays.

A few have been answered already, but just going back to your guidance, obviously, yesterday, you mentioned that Q2 would be significantly lower year-on-year. Just wondering whether this has been in line with what you had expected in terms of the shape of the overall earnings progression for the year. And then secondly, obviously, given the weaker Q2, have you identified any further cost cutting? I know you've mentioned comments on costs being lower in Q1, but just wondering if there's any new initiatives that you're thinking of rolling out given obviously the weaker H1.

Yes. All in all, yesterday's announcement was fully in line with our full year guidance, which we have seen from the very beginning. From the very beginning, we had been clear that Q1 and Q2 should be difficult or let's say, challenging compared to prior year, clearly below. We foresee an increase or a turning point in Q3 and Q4. So Q2, this announcement yesterday is a little bit mathematically given the development of Q1 and Q2 last year and our full year guidance with an increase that we see in the second half of the year.

So it was for us not new, but it's the [ MAR ] regulation that we have to respect so as you are aware that Q2, we also to compare quarter-to-quarter, and that's the background of this announcement yesterday, but it was fully in line with our full year expectation. And this is also meaning the measures that we have put into place, they are in execution. There's nothing additional or special. So we are -- let's say, we are fully in line with what was our expectation for this year. So the overall trend is Q1 and Q2 and a turning point in Q3 and Q4.

For the initiatives that we started, we are fully in line. We are in the midst of executing those initiatives. And for the full year, we anticipate measures to account for a high double-digit million amount. This is approximately 50% within [indiscernible] 50% within Südzucker. So we are fully on track on the measures.

We now have a question from the line of Oliver Schwarz from Warburg Research.

Sorry for that. A couple of things to unpack here. Firstly, Mr. Meeder, you said you are not in favor of the planned new agreement with Ukraine. You said those 100,000 tonnes are not needed in the European market. However, on the other side, your slide on Page 9 clearly implies that the EU will become an import market this fiscal year and imports are needed. So basically, what you're saying is imports are needed, but not from Ukraine because, I guess, of the lower price points they have. But overall, imports are required. Would that be a fair assessment?

Yes. Oliver, that's a fair point. Maybe I have been fully clear on that. So my major concern is [indiscernible] what we need import and it's clear if we have a deficit situation, we need imports, that's clear. But we also we strive for we need a level playing field for competition. And when imports are to be allowed or to come into the EU, we require that those imports respect the same sustainability criteria that we do.

As I said also with interviews, really, we have many, many, many restrictions for sustainability when it comes to the usage of plant protection when it comes to -- I don't know [indiscernible] means additional measures to increase the quality of the soils and the insects' protections. And we do all of that. I do not want to be misunderstood. I'm also fully in favor of sustainable farming and sustainable European farming and agriculture, respecting biodiversity and water and fertilizers.

That is fully clear. But this means if we then on the contrast, allow imports to come into the EU, I really urge politicians to care for that this is on the same level playing field, and we cannot accept that agriculture imports come to the EU, which do not really respect those restrictions, but they are positive than we do in European agriculture products, they have a much better, let's say, sustainability quality than a lot of the imports, and that's what are in the past.

It's better to say that this is not particular Ukraine. It is this level playing field that we need and this fair competition when it comes to sustainability criteria of agricultural products being imported into the EU. Thank you for this question. This needed to be clarified.

Fair enough. Very clear. Second question is on CropEnergies. And as you're an intimate, let's say, view of that situation, obviously, with your background within Südzucker and especially within CropEnergies. Can you help me out with what's happening there, especially in the U.K. I mean we heard that the U.K. struck an agreement with the U.S. that allows for the tariff-free or next to tariff-free import of U.S. ethanol into the U.K. market, which basically may or may not wipe out the U.K. bioethanol production due to the much lower prices the U.S. can offer than the domestic production in the U.K.

Is there a mechanism that would enable those volumes also to be transferred at low prices to the EU? Or is there a trade barrier in place that would prevent those volumes that are imported in the U.K. just to use the U.K. as a transfer point and then find their way into the EU and disrupt the EU market as well? That would be my second question.

Fair question. This agreement is still not yet ratified. So it's still under discussions, but the outline that's known so far is exactly as we have said, is 1.4 billion cubic meters of duty-free import to the U.K. related to -- we will have a negative impact as we have already communicated to the entire U.K. ethanol industry, that's clear. When it comes to your particular question whether these volumes may be rediverted or reexported to the EU, no, this is not possible.

So because we have clearly [indiscernible] country's origin rules, and this would mean it's not possible to redispatch those volumes duty-free to the EU. This is not the case. But at the end, nevertheless, it is this agreement per such is also weighing, let's say, on the sentiment because now people see there could be a risk of U.S. ethanol coming in duty-free. To my mind and to my knowledge, it is absolutely not the case, but the EU Commission has communicated so far that they want to do the opposite.

So they have indicated that if there would not be a sound trade deal or agreement with the U.S., they would be ready to increase the duties on ethanol from the U.S. Whether this will be true, we will have to see. I mean, I read this morning that there is a 50% duty on Brazil. So it's really, really very, very volatile, all of the duty discussions, and we have to see day by day what will really finally come into place.

But let's say, all these discussions per se, they are weighing on the sentiment because we really do not know what at the end of the day will be decided effective what [indiscernible] with sometimes even things that are discussed, they are taken back. So there is -- it is -- we are in a really uncertainty situation when it comes to all of these tariff regimes and duty-free regimes. But in a nutshell, to answer your question, no, U.K. -- U.S. duty-free ethanol to the U.K. cannot be redispatched to Europe without duty.

And my third question would be on specialties. You stated that price -- so production price increases, input cost increases that were yet not passed on to customers. Can you elaborate on what is causing those delays, whether you feel comfortable that you will achieve a full passing on of the related higher costs? Or will you have to digest some of that cost because your customers are unwilling to take them on?

And if so, is that a structural problem you face as you deliver your goods to a highly consolidated industry? Or is there another thing a miss that prevents you from, let's say, being more in form of a price setter than a price taker? Third question.

I mean, in a summary, there is nothing extraordinary in this. So it's normal cycles. It's depending -- the discussions with our customers are ongoing and its normal purchasing selling discussions with customers. We, on our side, we have increase in costs, yes. And we discuss with customers that we need to increase prices. And then it depends on particular markets. And in some cases, you are able to pass on the higher cost via the prices. In some other competitive situations, you are not.

So there's nothing special. I would say this is normal cycles when it comes to cost increases, price pressures. We have still in Europe, let's say, a little bit a recessive moment. So also when you talk to customers, everybody is fighting for price decreases. And so it's normal course of business.

But in a nutshell, for the specialty segment, we see the -- on the one side, the cost increases that we have on the other side, we do not see ourselves fully able to pass this on to customers. And that's why operating profit should increase in the segment as a whole, but there is differences between the different product categories.

We now have a question from the line of Hartmut Moers from MATELAN Research.

I would start with the outlook. And looking at your sales guidance for the individual divisions, you have decreased, as you said, your guidance for CropEnergies and also for starch. And remaining within your framework and the percentage changes that you have dedicated to the words moderate and so on, I would come to some, let's say, EUR 90 million reduction in your CropEnergies sales expectations, some EUR 60 million, EUR 70 million on the starch side. So we're looking at a level of EUR 150 million reduction. And here in contrast to operating profit, your fruit expectation has not increased.

So assuming that so far, your expectation was about the midpoint of your sales of your group sales guidance. Would that imply that given those changes in crop and starch, we are now looking at the low side of your guidance. So we're rather looking at the EUR 8.7 million, EUR 8.8 million rather than the midpoint or even the high side. Is that the right way of viewing it?

No, I cannot confirm. I mean we do not open up individually all those 5 segments. We do that for sure because it's the most important one. For the other ones, there are some fluctuations, but your calculation of around EUR 100 million reduction, I cannot confirm. So we are still around midpoint. We can say we are, let's say, slightly below midpoint, but around midpoint, yes.

But it's clearly -- I mean, if we would lose midpoint, it would be the need for changing the EUR 150 million to EUR 300 million guidance range. So we are slightly below midpoint.

Okay. But what would be then -- I mean, you haven't changed the indications for the other segments. But if you lower to some extent, not talking numbers now, but you've lowered to some extent, crop and starch, what would be the segments that you see a little bit better in order to compensate for those negative changes. So what do you see? So probably fruit could be better than you have expected, but probably not as much better to increase your guidance here?

Yes. Hartmut, I cannot be more precise than that. So we see a weaker development in CropEnergies and starch and better development in fruit and all this leads to the fact that from the group guidance, this can be maintained unchanged, being slightly below midpoint.

Okay. And the same also holds true for the operating side. Here, you're saying the increase in fruit compensate the decrease in special products and CropEnergies. Is that also, correct? And that would imply because the increase in fruit on a million-euro basis is not that extraordinary high. That would imply that you -- though you're expecting a decrease in CropEnergies and starch, you're not expecting any of the 2 divisions to fall into the red for the full year. That also -- can you confirm that?

Yes, we can confirm.

Okay. Perfect. The second thing would be on sugar, and I'm pretty much aware that already 2 of my colleagues have already asked a bit into the same direction. But I would also come back to the point of your reasoning for the price increase. I've understood the argument of the decrease in acreage. I've understood the argument of a potential dry summer. But what is the reason that you've shown us that on the world market, it is currently expected that we have an oversupply situation. And you have also shown us for the European Union that imports are needed. And looking at the chart you've presented, there's even, the amount of imports plus the production are superior than the consumption.

What is the reason that not too much imports could come into the European market. And I'm not talking about quality here. It just -- it could be a volume effect that too much of the worldwide overproduction could come into the European Union and prevent that base case in your calculation of a material price increase in October.

Yes. I mean not has already been said. So I will be short on that. So according for the sugar prices, the main effect are this reduction in acreage. The deficit situation in the circle right now, we are in a deficit situation, both on the world market and on European market. Also, our base case assumption, as I explained, is to foresee a dry and hot summer. And there is -- what we have not yet discussed, there is the risk of the diseases from the [indiscernible] and others.

When it comes to the key issue, that's what we have not yet discussed, the key issue is to what extent imports are needed. If only low volumes of imports are needed, they can come in via duty-free regimes with some LDC countries who have the right to import on a duty-free level into the EU. But this is limited in volumes.

If this volume is not -- if there's an additional need for imports, then the CXL quota numbers come in or imports. This goes approximately to up to -- and this is EUR 100 per tonne import. So that it's market price plus EUR 100 million per tonne duty. And if this contingent with volumes, they are also limited in number. If additional volumes would be needed on the European market, then they have to bear the full duty. And the full duty is at EUR 400 per tonne roughly.

And that means if we are really -- the question is whether we are in a, let's say, low deficit situation, then this would not have a material impact on prices. But if we would be in a significant deficit situation, then full duty kicks in, would lead to really strongly and [indiscernible] quickly increasing prices. And this is what we assume for Q3, Q4. But still to be seen.

As I said, this is our assumptions. We need to see how really at the end of the day, the weather conditions will be in July and August. This is the key element for the volumes, the harvesting situation, the volumes and then the pricing.

Okay. That was a very important clarification. And last point would be on crop. And I don't know whether you have done the calculation, but what you were saying was that the results in the first quarter were negatively impacted by the scheduled maintenance, but also by a number of technical issues. What I -- and this is also going to last into the second quarter. What I see is that with ethanol price at around EUR 600 and -- but wheat prices falling below EUR 200, there should be a positive development.

So my question would be, first of all, are you in a position that you benefit from the price decrease on the wheat side? And so that you should have on an underlying basis, a positive trend here also in the first quarter, my calculation would be that it should have been positive, excluding those factors.

And can you give us an indication of what those extraordinary factors, so the maintenance not being extraordinary, but only happening usually in 1 quarter and the technical issues, how much that would have caused if you would have been positive if you had a normal quarter, which one would expect at least in the third or fourth quarter then?

Yes. So for CropEnergies, my view on that has not changed. So the overall picture for CropEnergies is the [indiscernible] market dimensions or the market factors, they are fully in line. There is a strong need for biofuels. We won't be able to meet the CO2 reduction targets in transport without biofuels. So this is fully in line. It's also what we can see if you look into the numbers of consumption of ethanol. This increases year-by-year. So I have the numbers in front of me in '23, the consumption was 10.5 million cubic meters, '24, 10.9 million, 11.1 million in '25. And this is expected to grow to 11.4 million cubic meters in the EU in 2026.

So the market dynamics there are fully okay. And this is also what I've been stating here for since, let's say, 10 years, electromobility will not ramp up. And I said this 10 years ago, and I continue to say that we need really for the existing car fleet, we need biofuels, and this is fully in line. So the demand side is pretty okay.

When it comes to your question, you are right, we -- prices are going down. So there's a good harvesting conditions. There also has been less volatility on the grain prices in the current fiscal and the trend is downwards. And also, we believe this trend to be continued. And as we do our normal hedging procedures within CropEnergies, so the overall approach to hedging and risk benefit has not changed. So we do step-by-step hedging the grain volumes, but there is still a significant volume of grains not yet hedged.

So in this context, yes, CropEnergies benefits from lower grain prices going forward and roughly 1/3 is still open. So there will be a positive effect being -- what we have not yet so far seen in the initial guidance, this partly compensates for the lower prices that we have seen so far. So this is a mitigating factor, you're fully right.

Okay. And you would prefer not to relate to the impact of the maintenance and the technical issues.

Do we have maintenance? Yes. And this maintenance led to that we have had a lower production and lower sales volumes correspondingly because also typically what we produce, we also sell. So if there's lower production, there's low sales. And -- but it's not the main factor. So there has been maintenance. There's a slow reduction in sales in Q1, but we are looking to a steady development going forward through Q3, Q4.

The question was, would you be prepared to give a very rough indication, would you have been to produce a positive result if you didn't have the technical issues and the maintenance in that quarter? That would be the question.

Yes. Maybe we will be close to 0, but the main effect is the prices.

The next question comes from the line of Lance Jonathan from [ Verizon Fund ].

I think that was for me, Jonathan L.

Can you talk a little bit loud. We cannot hear you fully. Sorry, we cannot hear you.

Yes, sure. Is that better?

Yes. Better.

Yes, obviously, a lot of tough questions this morning. Thank you for attempting to answer them as best as you can. And I appreciate that the key takeaway here is that it's an extremely volatile cycle. And currently, it's a down cycle. So obviously doing your best to manage that. The question, I guess, is with regards to the international sugar prices and dollar is my first question. So what is the impact of the weaker dollar? What is the proportion of revenues which are coming from -- which are linked to the international sugar prices?

And then just looking at the charts on world prices, basically, it seems that the international sugar price is a leading indicator. I appreciate you touched on tariffs for the excess supply coming into the EU just now. I just want to clarify that point. But there's basically 3 questions is -- or a 2-part question.

One, given the international sugar prices are clearly a leading indicator for EU prices and they've continued to decline, what gives you the confidence again that the prices will rebound in the EU, especially when you mentioned around the uncertainty around the Ukraine supply, which you just kind of reclarified. That will be -- we can go with that to begin with, let's keep it a one-part question, keep it simple.

Maybe I have not fully understood all of your questions, and a lot has already been said, but I will try and if there's additional need for information, please come back. You said it's a volatile cycle, yes. You asked on the impact of U.S. dollar. So as such, we are not too much exposed to sales to the U.S. For sure, we have inbound business. For example, at Freiberger, we have a pizza business, which is producing in the U.S. for the U.S. There are some imports -- but as such, we are not -- as a group, we are not so dependent on U.S. It's an important business, but it's not significant for the entire group.

The weaker dollar affects us when it comes to the import pressure and the pricing into the EU, particularly in our ethanol because given the [indiscernible] quotation translated into euro, this is much weaker. So this is an effect, but I have already explained that.

The tariff situation, as I said, this is changing day by day. so far, we are not much exposed to that besides U.S.-U.K. deal. So there are, for example, in the food segment, some deliveries of food preparation from Mexico to the U.S., but the teams have done a tremendous job. So a lot of volumes needed, they have been imported into the U.S. prior to the tax regime being set up. And that means at the time being, we do not see ourselves too much concerned besides this U.S.-U.K. deal on ethanol.

And on Ukraine, so the pre-war quarter was 20,000 tonnes. So this is close to not being significant. This 20,000 is allowed 7 out of 12 months from July to December this year. And the discussion for 1st of October '26 is 100,000 tonnes and here, we are opposed. But as we discussed, it's yes, on the volume side, but also on the level playing field.

And just to clarify, so the EU sugar price as of reference price as of May was around EUR 540 per tonne, which is kind of close to your -- which you've used as an input, but the international price is closer to EUR 300 per tonne.

The world market is roughly EUR 410 or EUR 420 per tonne currently. That's the world market price translates into Europe. White sugar...

European...

Maybe on -- so the difference between raw sugar and white sugar is approximately EUR 100 per tonne, because you need the refining cost. So the differentiator between raw sugar and white sugar is roughly EUR 100.

Got it. Okay. And then just lastly to clarify, basically, we're betting on a -- I just want to make sure I understood that. So we're betting on or we're hoping on according to your AI intelligence basically that we're going to have a very hot summer and that yields will be lower, basically reducing the supply in addition to the reduced acreage that you guys have done and hoping for prices to recover next year.

Yes.

We now have a question from the line of [ Ben Sahir ] from [indiscernible] Fund.

My question is around for the second half of the year, do you see pricing -- customer pricing in your special projects business to kind of flow through to the financials? Or when do you see this flowing this into your numbers going forward?

This is linear over the entire year. So the many discussions with customers are right now. So this will kick in the course of the year.

Okay. And your second -- my second question is around your cost-cutting program. I believe it's around EUR 200 million. When do you see that ramping up? Again, do you see some impact this year? Or is it going to be more next year? And are there any upfront costs associated with that?

Yes. So Südzucker Group, we have, as you said, and what we already discussed last time, so we started a couple of substantial cost-saving initiatives. And those measures, they will start materialize in '25-'26. So for '25-'26 fiscal, we assume a high double million-euro amount, which is half at Südzucker, half at AKRANA. So -- and then what we did last year, we closed 2 factories in Austria, Czech Republic and refinery at AKRANA.

And the programs that we have for Südzucker, we call this program OPTIMUM and for AKRANA, program is called [indiscernible] program, part of the strategy. And over the next, let's say, 3 to 4 years, we start with a double-digit million-euro savings this year, and this should amount up to EUR 200 million over the next 3 to 4 years fully right. That's what you have asked is I can confirm.

We have a follow-up question from the line of Oliver Schwarz from Warburg Research.

Firstly, on CropEnergies, I think a lot of your current CapEx is earmarked for the, let's say, prolonging the value chain of CropEnergies. Meaning that you want to enter the market of chemical compounds based on the bioethanol production. Could you give us an update how -- is that up to schedule at the moment? When will production start? Are there the respective contracts of customers in place? Or are they still in negotiation, especially in the light of the decline in the oil price from -- especially compared to when you announced the project to now? That would be my first question.

Second question, is a bit more, let's say, theoretical, I guess. I mean, a lot of -- your fluctuations in earnings over the last 10 years were due to the volatile price of sugar, obviously. However, your problem from my perspective, at least is that in -- when sugar price was high and earnings were high, they were not high enough to compensate for the trough parts of the cycle. So over the cycle, you didn't earn, let's say, that much money or a decent return on investment or on equity.

When you -- is that to continue even in the light of your restructuring program? Or will you need some structural changes in the market as well? So let's say, in the blue-sky scenario, what would you be wishing for, for changes in regulation, for changes in market consolidation or from some other sources that would help you achieve over the cycle a higher return? That would be my second question.

Okay. I'll start with CropEnergies. So here, when it comes to the ramping up of the plant at site location for ethyl acetate, and here, we are fully in line. So there's no change to our prior communication. So the start of operation is planned for summer '26 and CapEx is around EUR 160 million. We are still in customer talks and -- but the feedback still is very, very positive. There is a need for clean products, which are fossil-free.

And as I communicated also last time, ethyl acetate is a product for those who do not know this, I'm a little bit more exhaustive on that. This is a liquid. This is going into nail polish, nail [indiscernible] nail polish. It is really -- it goes into painting into many, many applications. And so far, this product is only available [indiscernible]. And we are in talks with many customers said, yes, this is exactly what we need. We are committed to sustainability. We want to have a green product. We want a CO2-friendly product. And so there is no change.

We are optimistically looking to closing the construction of the site and then starting. That's nothing new, and I'm fully convinced we need green carbon hydrates. We need green bio-based chemicals. And we have a long-term perspective. Even if right now, there are some discussions on reducing target sustainability, it started with the Trump administration. For me, this is a short-term downtick, the overall trend, the need for CO2-friendly products is there, will be there, and we are committed to that, and we will continue to do as planned, and we are not going below our ambitions.

When it comes to the quarterly development, what you asked and you said from your point of view, our problems would be these developments. I would say we do not have problems for us it's really challenges. And the challenges is volatility of the business and -- but we know this, and we have the volatility in sugar, which is our key topic today. So our focus is to get a speedy return to the positive within sugar segment.

One key element is pricing. And the other one is really those cost measures. And then what is really positive this time, we have really a speedy reaction within the group, for example, when it came to the reduction of our acreage. So all the measures are fully clear. We are in execution. As I said, it's not a general problem. It's a challenge, and we need to do our homework and then it will be better next year.

Yes. But I mean, if you look back, let's say, for the last 10 years, I think the high of your sugar result was close to EUR 1 billion and the low point was minus EUR 300 million. You can't really meant that by, let's say, EUR 100 million of cost cutting. That obviously, that improves your cost situation. But nevertheless, that will only help to dampen a bit the volatility.

What you need perhaps is, let's say, on average, a higher price of sugar over the cycle to help you earn a lot of money in the up-cycle times and not to lose as much as in the past in the trough cycle part. I think that's the key here. And what will be needed to achieve that?

I mean, yes, you're fully right. I mean the bigger leverage is the pricing. Nevertheless, we need to work on our cost basis. That's clear. But it's clear the main factor is the pricing. And to have solid prices in the EU, we need to manage volume, and we cannot be in a surface situation in Europe, but this is the volatility and the [indiscernible] of nature, we will have to see the harvesting conditions. But you're fully right, the key issue is pricing. But nevertheless, we need to do our homework at the same time and speedy.

[Operator Instructions] We now have a question from the line of Setu Sharda from Barclays.

It seems not. But if you have additional questions, you can hand them all by writing. You have our contact address to Andreas, and we are also -- it's a technical issue, you can hand it also by writing.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Andreas for any closing remarks.

Thank you very much, Nathild. I'd also like to thank everyone for participating in this call and for your questions. Of course, we hope you will always also be joining our virtual Annual Shareholder Meeting next week, July 17 on Thursday. And we wish you a great rest of the day. Stay safe and see you soon. Thank you very much. Thank you very much. Goodbye.