Q3 2023 Grifols SA Earnings Call
Hello, everyone and welcome to the <unk> 2023 conference call.
Thank you very much for taking the time to join US today. This is Gwen Investor Relations sense sustainability also Sir I'm joined by Thomas Glassman, Our executive Chairman and C. E O <unk>, Chief operating officer, and I've read the right Yep CFO.
This call will last about 60 minutes that will be a presentation of approximately 30 minutes followed by a Q and a session. So if you want to raise a question press. The start followed by five when they're Q&A session begins and we will kindly ask you to limit your questions to.
Maximum of two.
As a reminder, this call is being recorded and the material spell the call our relations website at <unk> Dot com.
Transcript and webcast replay of the call will also be available on the Investor Relations website within 24 hours. After the end of the conference call.
Now if we turn to slide too.
Before we start I would like to draw your attention to therefore, we're looking to statements disclaimer in this <unk> of their release.
So we're looking to statements on the call a subject to substantial risks and uncertainties speak only as of the calls original date and we undertake no obligation to update or revised any of the statements.
Now I would like to turn the call over to Thomas Glassman.
Thank you new area, good afternoon, and morning to all on the call. Thank you for joining us today.
As you can see from a press release issued this morning, we have reported another strong quarter further accelerating growth improving our a b D a and meeting our commitments.
But before we go into our operational performance I want to address upfront what is and has been the market's concerned about our deleveraging progress.
Our commitment to deliver a material.
Leveraging transaction in 2023 of at least 1.5 billion in cash has not changed nor has are very focused efforts to reach a level ratio of four times by 224.
We continue to give full priority to this.
Regarding the in June announced transaction in China, we are progressing and working diligently towards getting the agreement sign and expect to announce it before year end two twenty-three in line with our commitment as.
As we are dealing with a very highly regulated environment, we expect to get all approvals and closing the transaction during the first half of 224.
Ultimately this will support the organic results. We are currently already delivering to continue deleveraging the company let.
Let me not walk you through how we are meeting our other commitments.
Q3 was another quarter of strong revenue growth well, we also delivered a 25.1% adjusted EBITDA margin, which is a significant improvement of 480 basis points compared to Q4 22 margin.
The revenue growth was primarily driven by Biopharma and our flagship franchises immuno globulin, an album and and we expect that momentum to continue throughout the year.
All the measures to achieve the euro for 150 million cash cost savings from our operational improvement plan haven't been successfully executed we are already seeing and will continue to see the related margin expansion throughout Q4 and next year.
This is particularly visible in plasma with cost per liter further declining while our plasma supply levels continue to grow at a double digit pace. As a result, we are now committing to the top of our adjusted EBITDA Zion guidance to deliver euro one.
0.4, 50 million for the full year two twenty-three.
Analyzing the operational improvement plans total savings are adjusted EBITDA margin is anticipated to increase to 28% to 29%.
Which is in line with 2019 E P T a margins.
R E B Ta and cash flow improvement are significantly contributing in our organic deleveraging progress with our leverage ratio now at 6.7 <unk>.
Versus a peak of nine times last year.
As mentioned and I strongly reiterate we will continue to lower this ratio and are very focused on meeting are for time target, including signing one deleveraging transaction this year.
And last but maybe most importantly, we are now stepping up our focus on our growth strategy to ensure the creation of sustainable longterm shareholder value.
We are actively accelerating a series of strategic levers to strengthen our industry leadership as the global market maker.
H a recent Egypt in Canada project a strong examples.
We have also taken steps to further strengthen the leadership team to drive innovation and digitalization at Grateful fire appointing your should Trump is our chief scientific innovation officer, and meager Luzon as our Chief Digital information officer, both bring a wealth of experience and.
Have a clear Comcast to take <unk> to the next level.
We clearly continue to see innovation as a critical strategic value, creating lever for future growth and are therefore working towards accelerating our pipeline. A testament thereof is that all our milestone set for the second half of the year are on track and having completed the bio test.
Fibrinogen trial in Q3, we are confident that we will also there be able to provide topline resolved soon.
Needless to say, we continue to be very optimistic and excited about both fibrinogen entry maudlin and the great opportunity they represent for grid falls in the future.
Having delivered on all our priorities and with our fundamental strong we are now well on the way to truly reposition grateful for sustainable profitable future growth.
Is a new chapter for grateful and we are very excited to embark on it with that I will now hand over to Victor to take you through the details of our business units performance in the corner.
Thank you so much good afternoon, or good morning, everyone and thank you for joining us today.
<unk> six.
Our revenue growth.
Throughout the period so throughout the previous quarters has been remarkable.
<unk> have you mention inconsistently, the sequential progression remains exceptionally strong and positive.
Could you stand alone delivered a 9.1%.
<unk>.
Q1, followed by a 6.5 <unk> N a 9.63.
Three all of them are concerned currency.
Revenues grew 8.4 per cent for the first nine months of the year.
For this first nine months of 2023, we actually have revenues of more than 4.8 billion app by 11.7%.
And currency.
Was primarily driven by performance or Viropharma.
<unk> as well as by your best contribution.
Please bear in mind that we are consolidating nine months of via text in 2023, while only five months and 2022.
Now turn into a slight seven.
What about your phone number four months what remarkable.
<unk> you know what I mean.
Global influx your product.
Which further accelerated in <unk> with.
<unk>, 17.4% sales growth in the corvette and close to 15%.
<unk>.
As well as.
A franchise I G.
<unk> continues to be driven by a strong underlying volume demand in February pricing, especially extra U S.
<unk> continues to <unk> volume.
<unk>.
<unk> backed by higher than mine in the U S. 75 continues to offer a bash commercial opportunity and we'll plan capitalize on this gross with launcher and some European countries.
<unk> you're starting.
In this <unk> in this Q4 2020th today.
Can you put your strategy to container strengthening it but I've only transaction the U S.
Another selected countries.
We are focused on the immune deficiency market, including the highest growth primary and secondary indications, while remaining leadership in neurology and acute care.
Earlier this week with a C.
If they have the approval for a new I G fortification facility.
Which will increase <unk> one extra capacity.
60 million grams per year.
Disapproval.
Only obtain your record of time, but it will enhance efficiencies in terms of yield recovery.
Per gram.
You mean, we achieved this term revenue grows year too late.
And close the way 10 per cent increase.
With a higher demand in China, and solid price increases in some key markets.
Also one in a specialty protein segment revenue <unk> relatively flat, mainly driven by lower the amount of plasma <unk> and to a lesser extent lower alpha one volume so to industry dynamics in some European countries.
I'd also undermine improves on the back.
Solid underlying improvement in our success successful commercial model.
<unk> lower growth is expected to be <unk>.
At the same time I would like to highlight in this segment <unk> four months of our modern recently launched products such as <unk>.
<unk>.
We tried to grow significantly in addition, hyper and I'd be <unk> I'd also delivering a positive evolution.
Now turn into a slight number eight.
A root of the successful execution of our operational input of my plan.
Later continue to <unk> declining by 22%.
September 2023, <unk> is July 20 twenty-two pick.
This has been driven by decreasing donor coming in compensation.
Magenta network and it's tough rationalization.
<unk>, a father of plasma related costs, such as all of our heads.
After <unk> after a civilization of dollar compensation and cute though.
To the client is slightly <unk>.
Going forward, we are targeting additional operational efficiencies.
So the process optimization streamline operations and overheads <unk>.
The processes and this is <unk>.
Plasma supply girls remained solid at 10%.
<unk> this plus muscle grows positions the company to continue meeting the growing underlying demand for our products.
In parallel and since the beginning of the year, our R&D manufacturing and quality teams have been working on a project to significantly improve our yield into my glove on it. So far we have seen Betty group dissolves in pilot scale production.
And we are beginning to implement it in for escape.
As we speak.
<unk> call, we hope to able to provide more details of this project.
And it results we expect these improvements to further improve our machines as it is fully deployed.
Now moving to slide nine.
This year and for the first time ever in the company made a strong commitment to accomplish 12 innovation milestones and I am proud to say that we have made very good progress so far.
Out of this 12, we have completed nine.
And are on track to we achieve the remaining in the coming months.
Among others. During this nine months of 2023, we can finalize enrollment both the procedure Sir Sparta tryouts.
They're <unk> advanced forums from single to repeat those face face enough for one.
15 per cent super tons of your story.
Photographs and dryers across our <unk>.
V I V. I G. <unk> 75, biweekly study and assembly five secondary immune deficiency CLS study.
What <unk> worth mentioning is that an <unk> wished sign a cooperation agreement with the National Cancer Institute.
For our <unk> 564 project.
Of course, I envy preparation has been submitted this October which sets sets. The stage for did you guys send face oncology asset to enter clinical development.
Also indigestion front, we have received positive feedback from the F. D. A P. I N D meeting held in September concerning does he got 23 79 development in <unk>.
<unk> <unk> <unk> <unk>.
<unk> space, So all of our company or a loan on the face too <unk> of.
Vaccine candidate a beta vaccine 40.
For this for the treatment of patients with mild cognitive impairment and very mild disease.
This is releasing purchases final result.
Regarding by your test the mother and <unk> are advancing I suspect it and.
And we are fully focused on capturing Saddam gross opportunity.
<unk>, we have completed the enrollment in the five G notion at first <unk>.
<unk> another interact poorly store brand results.
120.
24 for a remodeling escaped <unk> <unk> have already been enrolled.
This positive development as testament to our commitment to maintain and increase efforts in developing new products and indications, which we plan to continue to accelerate for the remainder of the year or works.
We expect the appointment of your chief.
Scientific innovation officer to enable us to execute on our objectives and further accelerate our pipeline.
Now the next slide number 10.
No state revenues decline 3.1 per cent per cent currency in the quarter back 0.9% a year to <unk> on a year to date basis essentially.
Previous acquired this <unk> technology.
Technology was negatively impacted.
Due to the pricing concessions even.
Change for extending a large contract with Nike customer of us.
However, if the wrong instruments in Japan, and Indonesia are helping to assert part of this decline.
And blood typing solutions, we are seeing is throwing rose across the U S. Argentina.
In the middle is partially partially offsetting the lower says <unk> experience in China lately.
And recommend on proteins.
Contract manufacturing from our <unk> plan, we have sang Avenue 10 year's supply agreement with an important partner.
Gnostic field.
And I'm moving to a slight 11th.
And by your supplies revenues decline 14.
4.1% in the courtyard, you too <unk>.
<unk> bye subdued the man.
We look forward to leveraging the acquisition of access by your Las Vegas, and capturing the full potential of these business units.
And I will now hand, it over to Alfredo who will go over to the gross financial performance.
Thank Victor good day to everyone.
<unk>.
Overall, we have delivered strong performers corrigible.
Revenues profitability and its thinks you need a balance sheet.
Our revenues continue to grow sustainably at 9% a constant currency in Q3.
<unk> grows to live in 0.7 per cent.
Our Abd Martin continued to show sequential expansion further improvement to 25.1%.
The 20 people for E Q2.
On the back of voting has profitability, which will continue to improve in the upcoming quarters.
<unk> ratio declined to 6.7 times from nine times speak of last year.
<unk> <unk>, our <unk> pass.
Slight routine.
Revenue has shown a very positive sequence you're trained throw this year.
12 months basis total revenue had reached more than 6 billion Judith.
With 11% gross.
Biopharma continues to be the key grow driver with a solid underlying demand, particularly <unk> <unk> <unk>, <unk>, <unk>, which continued to gain traction.
What else do you need a franchise in China.
Our H U S strategy.
Also need <unk>.
Together with meat single digit price increase.
July 15th.
How 'bout gross margin significantly improved over the last <unk>.
Reaching 41 per cent in two three.
<unk> sure the steepest gross margin expansion English <unk>.
Improving by 400 basis points.
<unk> last year.
This is due to biopharma remarkable performers.
22 per cent decline <unk>, which is now clearly reflected in our P. N N. After <unk> after nine months account in life.
On the right hand side of the slide you can see a significant decrease.
Is there any cost as a percentage of revenue.
This reduction which amounts to nearly 120 basis points compared to U T last year.
Nearly activated to operational leverage.
<unk> <unk> from our 450 million euros operation <unk> plan.
Slide 16.
All of this is going to be hated into higher margin for the group.
The 25.
1% is the third quarter.
More than 1.3 billion.
<unk>.
You have to date it had reached more than.
<unk> and 23.2% margin reflected.
<unk> 480 basis points <unk>.
Two N of 22.
Most of the improvement has come from by your phone.
<unk> <unk> <unk> <unk>.
Our personally Premier plan Kismet also significant contribution to <unk>.
Oh last 12 months spaces AVG cashing, please by 20%.
With a significant Martin <unk>.
<unk>.
Considering this even if you can imagine improvement.
Very confident in our ability to achieve the high end of our previous D V D guidance.
Respect for years.
23, total revenue growth of 10% to 12% of course known currency, which is supported by Biopharma revenue growth of 12% to 14% of course bankerish.
Regarding <unk>.
Now respect for the second half of the year.
He is 25% from the 24 25 per cent range and 24% margin.
Brush for the full year 23.
All of this confirms.
Sure.
D V D guidance.
<unk> 40, 50 million by the end of the year.
And if we consider the annualized savings the pro forma 23, <unk> <unk> in the 28 29 <unk>.
<unk>.
Martin range, bringing us back to the pre COVID-19.
Martin Lewis.
Right <unk>.
Building on all efforts made through previous quarters, we continue to make progress on our deleveraging path.
267 times.
At the end of September of the year.
These guys being driven by a big improvement bug bite goodness <unk> cost savings <unk> cashflow improvement.
Remain confident to achieve elevated target four times by the end of 24.
Current liquidity is more than 1 billion, including $454 million in cash.
Now I have no <unk> for the final remarks.
Thank you all afraid Oh, maybe to put all of what you have heard into perspective.
Last year, we embarked on a journey to turnaround Griffith financial performance as well is to build an increasingly performance oriented efficient and accountable organization.
The third quarter has been testament to that we are well on the way to meet our objectives are.
Our fundamentals have never been a solid and we have delivered a strong performance across the board executed and our key priorities and very importantly delivered on our commitments.
One we have grown our revenue sustainably too we have enhanced profitability and have sequentially updated already BTA guidance for the full year twenty-three accordingly, and remain on track to reach 2019 E. P. T margin levels next year and three driven by all of these and.
<unk> and a commitment to delivery deleveraging transaction of at least 1.5 billion still in 23, we will strengthen our balance sheet and are on track to reach our guidance of four times by 224.
At the same time, we are not losing sight, what's ahead of us beyond twenty-three.
We are now very focused on realizing grateful for potential and in doing so maximising value for all stakeholders.
Our efforts will concentrate on a number of strategic levers one we will build on where we see our core strengths and the best competitive advantage.
Two we will continue operating as a global market maker in shape for in our markets seizing those commercial opportunities that are most promising and hold great potential three we will continue to accelerate and bolster innovation focusing on a select number of therapeutic areas.
Mm prioritizing those projects in our pipeline that will boost our profitability and differentiate us with our customers.
Under the leadership of your the architect of Fibrinogenic three Madeline, we will strategically strengths and innovation is our future growth engine for Biopharma. Four we will continue to enhance donor attractiveness through personalization of the experience digitalisation and streamlining our <unk>.
<unk> five we will also continue to improve our business and operations through further process optimization streamlined operations and Digitalisation to drive efficiency and sixth as a market leader, we will explore new markets and business opportunities.
While we enter into agreements to deliver groundbreaking differentiated patient and customer solutions.
Importantly, the six strategic pillars will be backed by a performance oriented management team and a strong people and talent development culture. We.
We will build on the current progress and momentum while maintaining strong financial discipline.
Both with regard to P&L and balance sheet management to ensure strong sustainable longterm financials in.
In the coming quarters, we will give you more details of all our strategic levers and update you on the progress as we continue to deliver to our commitments in the short term I want to conclude thyroid reiterating how encouraged I am by all our progress in the first nine months of the.
A year and I do want to thank the entire <unk> team for their hard work and dedication I.
I appreciate your attention and I now turn it back to new area, who will open it up for discussion. Thank you.
Thank you Thomas and thank you for your time.
Now, let's start that Q and a session. Yes. As a reminder, you need to press start five to ask a question and we need to stay till two questions. <unk> you can dial sapphires again, and then we will replace it once again in the in the list. After your question we may.
Need to put you on mute to avoid background noise.
Okay. So we have already requests for our questions first question today comes from Tom Jones from the.
The data Hello.
Oh, good morning, that's what I'm, saying.
Thank you for protecting my questions I I kind of both of them or do you relate to the <unk>.
Transfer agreement that you've reached me signed with by a test Uhm wanted to just to strike for financial wasn't really I think is swollen and got it towards somewhere around the mid triple digit million.
<unk> number.
<unk> 23, 24, 25, 26 time frame it would be helpful for us to try and understand so broadly how that might be white to just just to help us model ice or free cash flow over the next couple of years, and then related to that sort of related to the mass distribution agreement. You also have with them. Just wondering how you were intending to.
Position your mom go that novel logging G products against your existing.
Since then to fly brands and how you might show you don't cannibalize each other on an inadvertent lane and ultimately tried the most revenue in value across the entire I G. G friend charged by with with all of those products. So I saw something out there that sort of.
The marketing strategy for those different Archie G products would be helpful.
Uh huh.
Thank you to all three questions regarding the <unk> with with biotech.
Basically this is you know what <unk> would you have seen in the press release is when you stand alone basis on.
<unk> <unk> I mean <unk>.
The the the payments related to <unk> will be will be done based on the cash flow needs of biotech. So you will not be any.
Could you repeat this.
<unk> I think the the second piece of of your question, it's about the positioning of your mobile.
<unk> <unk> would have to.
<unk> <unk> <unk> and the other one is <unk> our our idea is to basically the weather here is that <unk> is still with time once the <unk> <unk> in different countries too.
Two commercially switched around for level two T. Mobile this is kind of <unk> the <unk>.
So that's really helpful.
It's a really quick 113 713.7 billion of restructuring charges in and <unk> with a book to it just helps US call you up a models.
Depending on <unk>, you know they're they're.
<unk> for the manufacturing area of <unk>.
<unk> called Destructor dago, either to Cox 0202, <unk> I mean.
Further details you can pull up you know the the specifics.
Specifics with with my team.
Okay, well, thanks very much.
Thank you we have a question now from <unk> J P. Morgan Hello, James.
Hello, James Gordon J P. Morgan Thanks for taking the questions. Two questions. Please first one that I spent plans. The question. The question was just what is the cause of it taking it might be a little bit longer than we thought to close it has been about five months since the June update.
Is it that you're looking to do something more complicated like maybe a combine transaction <unk>.
<unk> or or some <unk> dynamics in China at the moment or what has this taken a bit longer and why are you still confident.
The second question was just on Biopharma gross so strong performance in the cold. So I think it was $40.
<unk> and 13.7, and a quarter, but you'll still guiding for the full year, 212% to 14%. So that's quite a wide range of only two months of the year left and it does imply tends to be quite a slowdown in queue for some reason that just conservatism on top of things go on in queue for I can see your baby got a tougher to buy a test or is it like in the street.
<unk> why might things theoretically slope, so much and just the last few months of the year.
Hi, James This is Thomas I'll take your first question and first of all let me just remind you that you know Shanghai Ross, which obviously is the acid. We're talking about is extremely attractive and there've been many many people that have been had an interest in in this asset now also this being a China transact.
And it's a very complex and environment to negotiate we do want to make sure that you know that that this turns out to be a good transaction both in the short and long term for four grateful. So that has taken time and we obviously you want to make sure we cross all the eyes and teeth, but it's it's really.
More than the fact that you know getting anything done in China does take a lot more time than if you were to do it in Europe or the United States.
Okay I think the the second part of your question no. We are fully committed to to meet our our our targets of revenue Grove, what we're both combined with by your test Uhm Biopharma on a on a standalone basis is fully fully it fully there.
I think it was just the <unk> the full.
Full breath of the range would imply that they might be quite a slowdown. So is it just you don't want to change the the range at this time.
Cause they get to just 12% you'd have to have quite a slowdown versus what you've done in the first nine months.
I've had the British thrown in fact, you'll <unk>, you'll see quarter. Four Q4, we are I stick to our budget and if come. So I'll go with that would you say, we will try to <unk> of course, but it's it's kind of you know the squirrely, saying, sometimes the swings are alright.
Not really let's say.
Underlying reality.
Thank you.
And K M's next question is coming from <unk> from other <unk> <unk>.
Hello, Thank you for taking my questions.
Just one of the staff.
<unk> <unk> <unk> <unk> <unk> and you want US does the first question that second one on deliver aging.
Beyond the Sunday as Hell.
<unk> that you that you kind of concerned.
Have an appetite to do all this transaction.
<unk> <unk> <unk> <unk>.
How long have you would need to be in order for you to get to your <unk>.
Does it need to be as big as a Sunday, so could you do something smaller and get that thank you.
Remain question now we're seeing a strong momentum are are in.
And I'll you mean, both in China, another named <unk> globally, and we are meeting our demand.
<unk> coming back we are we are we are meeting this demand that that is <unk> that is out there for us so what's up perfectly line I need 40, let's say controlled.
I'd go with Thomas here, we are actually very focused now 100 per cent on signing the China transaction and are actually at this point in time not looking at anything else, we believe that the organic at deleveraging.
Combined with the transaction is gonna get us to the target that we set for ourselves for 24.
Mm okay.
And then next questions come in from add a line Sir from Atlanta <unk>.
Hi, Thanks for taking my question. The first one is.
Could provide some original detail on the evolution of Alpha one.
You seem to be a bit.
Week, I don't know, whether that's finally man or increased competition.
From other plasma players and the second issue if you could provide some guidance on cash flow.
If there's any working capital remains.
Hi, guys I know, if we should expect continued investment in queue for and and also going into 2024.
Thanks.
I take the first one.
Afternoon.
And also one yeah I'll reset we're seeing today kind of flattish evolution in this franchise for US there are many many components as well you know we have a pretty unique let's say business model when it comes to to commercial.
Specially in the U S and in our historic our markets.
The pandemic, we are fine tuning. This model. This model as you know rocky important factor for the <unk>. The first is in the final is the testing testing P. S. <unk>.
Justin May Uhm, <unk>, which is the alpha Ivy at home, which is a compliment to the health care professional.
Testing model. So we are fine tuning there we expect these let's say flattish Trent seeing recently will be around hearing you any 24 as we as I said, we make some small tweaks in our.
<unk> up to the to the new times after the pandemic.
<unk> to your question of the Cashflow.
<unk> you know we have you know that he does you will know that you're just cost you know most of the payments were down into two one <unk> a significant positive <unk> mmm cash flow and we're gonna see decent not only do one <unk> <unk>.
Regarding the email Torres, yes, wishing you know send me <unk> in this quarter, but yesterday, we are in the same days three days around 200 would you see language with the previous year.
That you know, yes, 19 at the number of days, but due to the increase of the activity.
<unk> double digit growth you request additional email, but for the hearing we're gonna see you know.
Very positive cashflow before that service.
Thank you.
Thank you for that we have a question from <unk> from <unk>.
<unk>.
Hello, Thank you for taking my questions. So first of all a follow up on the on the previous question.
<unk>, so we keep seeing <unk>, calling me up.
When you should we see a decline.
So what is your next <unk> for for the next year.
Cost effective.
Fashion that correct.
And.
If you could touch upon the slow down in the diagnostic carrier.
<unk> <unk>.
Okay for the first question the.
D. I mean did need that reaction will be seen primarily on the back of the cash proceeds you know coming from the basement, because even though wishy. That's hour operation of cash flow is it's gonna keep improving <unk> next year, but you know we need to do deliveries.
<unk> basically you know the.
<unk>.
So the.
Question, you talk about this low down I think in this in this quarter.
If I understood correctly is <unk> and the reminder, that in Kyoto was hurt unexceptional, let's say revenue or income coming coming and there's one that of course is unexceptional, one I'll need stuff happening in in in the next <unk>.
Okay and now we have <unk> <unk> I think you have some additional questions.
Oh did it just wasn't ready it was a it was a broad a follow up question around.
You kind of building pipeline and if I, if I left for class everything you've got.
A building number of assets, whether it's two giga products 564, and 2339, you've got me all passed by M D product before 290 product.
The Netflix I will not necessary so to Wanna. Thank broadcast as well plus you got <unk>, you would only sort of known <unk> somebody <unk> plasma products, but you got a lot of <unk> products building up an apartment, which is great, but I just wanted to kind of what your long term thinking around the development of these products.
Because to be Frank at the moment the the market just put some multiple <unk> take anyone's got a penny of revenue in any bodies model for any of these products sorry.
Today, they're a bit of a drag on the equity story, sorry, I just kind of wondering what the <unk> <unk> take them all the way through to development and marketing or at some point you think you'll start outlicensing. Some of these products and tying up with people who might have more expertise in in late stage oncology drug development I, just wonder what those kind of big picture Harris cause it at the moment.
You know the that'll cost benefit from from the equity market perspective.
Thank you yeah. It's it's a very very good question from from your side, Yeah, clearly uhm.
Remodeling on February nausea, and will play a key role here as plasma will be in our core both in.
Today in commercial on manufacturing, but also for our future development. So plasma clearly will be in accord with doctor products and the compliment coming from our lifecycle management that that we are that we are going different products.
In those new technologies 40, Samsung <unk>.
When we made the acquisition of these of these assets or this technology I should say lash in that in that in line with the <unk> brother portfolio, we saw that an interesting opportunity in the in the way we can obtain globally notice specific.
<unk> from this from this technology, it's happened that that company came also with this oncology interesting.
Interesting initiatives or programs, there and we just wanted to continue them Boeing for what if some of them are successful. We are clearly open to to this to define and decide whether this remains you know what.
<unk> and we let's say explained to oncology or we kind of.
<unk> whatever is a form for those.
It's a non plasma plasma programs.
Okay, that's briarcliff.
Now am I <unk> Hello.
Yeah, Thanks for allowing me to jump on <unk>, just two questions first section on capacity and considering that the fast growth in activity. If I am not mistaken available in Q2, you mentioned that you were around 60 per cent capacity or something like that.
Remind us an update on how is training and when you shoot you return to.
Mmm, how you got the two spending a stomach is currently running lower than it has in the past and the second question is just if you could provide some guidance on the information of minority.
They have been training <unk> higher than I expected.
Some of the.
Companies here do not have a report that the like the connection that's my connection networks of mind by assist U S O.
Whether we could extrapolate.
30 million per quarter.
Currently or you can provide some guidance for these your next year. Thank you.
Okay, Yeah, I'd take those questions you know regarding capacity you know.
Yes, we confirm you know the last cold is 60 per cent capacity <unk>, you know <unk> the upcoming <unk> growth.
<unk> will pick the Denise next wave of Capex expansion will take place in 2028, Okay. So we have a clear path. So lower spin from now to 2028 regarding the minority the minority line with an L. P N L for you.
Uhm mobile you can extrapolate 100 million per year.
Thank you.
Okay Uhm apparently we.
Two persons were trying to access and we're having some kind of problems. We will try to give access from our side, we have <unk> from city.
Can you hear <unk>.
Nope.
Okay <unk>.
No. Okay, we'll try again later and then.
<unk> from Margaret Cho speed ma'am.
Nope.
Okay, Let's say we solve this let's continue with that <unk>. You also had <unk> can you hear.
Hello can you hear me.
Okay.
Can you hear me.
Oh, yes, yes, yeah can you wait <unk>, okay perfect.
So so it's a question on the funding of as as I know vaccine.
<unk>.
Just wanted to know at Shaw kind of often too. So I would try something this finding a path to find out the R&D shall willing to to call. It yourself.
And then the second question when we think about the <unk> no cough, all by including savings the one 175 billion.
You know how how how comfortable are you with kind of consciously choosing research base, you know going for awhile.
And using it as an N dot I T. Guy Telephonics, Yeah is there any kind of accounting element of business that I might need to think about that that would make it. That's a good a good approach to do that thank you.
Okay.
Everyone vaccine.
This was an important milestone for us that we have been waiting the fish, so clinical trial, and and and and and data out of out of that as you have seen very positive data across the board.
Yeah, Yeah, and this is linked to a previous question. Yeah. We we are very open to.
30 potential out licensing this product for that face.
Just about that we could not hear you very well the second part of your question can you can you summarize it was Sunday accounting.
Well she was just.
I've always kind of and then you can call us using the one 175 billion of our Darling.
I, just <unk>, including all the poor farmer.
Savings.
<unk> being used as it based on you think about the <unk> you can you know encouraging growth.
Phonics, Sir so basically you know <unk> using these number as as a baseball fan and going into next year. So just wants on destination, if you're comfortable with this approach.
Yes, <unk> well this time [laughter]. Thank thanks for repeating the question, yes, Yeah. We're comfortable with this is 17 50, considering these you know <unk> you're gonna go into 2024 should therefore, yes D I remember that.
How does it for 150 million pretty cash savings 150, roughly will <unk> Uhm 200 next year. So that's why we that's how we come up with these 17 50. So so yes, we reaffirm that will comfort.
Thank you.
Hello, we have a question from hi, Miss <unk> <unk>.
Hi, good afternoon for a couple of questions from from my side regarding the gross margin Securitas is Pamela on 41 per cent on Q3 <unk>.
2019.
Sure give me pause, what's making 46 per cent.
But the cost of plasma keeps going down and I remember you mentioned that in Q4.
We should <unk> the impact of the of the cost saving plan, Sir I Wonder.
How do you see these 46% gross margin a horde of volume following <unk>, even if we could think about.
<unk> higher than that.
My first question.
Okay <unk>, yes the.
As as you know, we we need to <unk> I can't be lack for the for the plasma cost and and then as I said you know auto the 450.
500.
Hyundai.
Next year, so they're gonna go through Upenn most of these 300 <unk>.
The release two two plus my course, so yeah. We're.
We're gonna see that <unk> is gonna keep growing sequential basis.
Basically you know these <unk>. These are the same time is gonna.
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<unk>.
And then you had a second okay ma'am.
Yes, My my second.
<unk> yeah.
Got it and then they can have a plump.
When when do you think we can stashing revenues coming from there.
And your manufacturing possibility that.
What could you expect.
We were there a few months ago the whole team.
Meeting with in our Canada plant I can tell you that the Capex is progressing the finishing off of that we can expect to see some production coming out of this facility and during 2025.
Okay. Thank you.
Now I think we got we have recover from my slice <unk> can you hear us now and whether we can hear you Hello.
Hi can you hear me now, yes, yes, I apologize for that Amazing [laughter] No no no. Thank you very much taking my question just a couple of those Shanghai rescue I was wondering if you could just provide us with a little bit more detail around what the regulatory hurdles and uhm approval that you are currently navigating with this deal and what <unk> do you.
Need and when to kind of get confidence that you can analysis, signing that <unk> and <unk>.
If you could just reiterate what gives you confidence that you're able to find this by the end of the yeah, and then secondly, under one and a half billion dollars in cash realisation can you confirm if this is a pre or post X amount and what gives you the confidence that you can in fact realize that.
<unk> can you just reiterate that you all confident you'll be able to realize that passion and you'll be able to use that to pay down debt. Thank you very much.
So so let me take the first part first of all at this point, we are very confident that we can take the transaction across the finish line before year end.
Because at the end of the day. It is the regulatory some of the regulatory pieces will come in the next year and the first half of next year. So that's not preventing us from from the signature as such so we're gonna sign and we are pursuing the regulatory and as we said we expect that both both.
The closing will take place in the first half of of next year.
Regarding the task <unk> at least 1.5 billion.
<unk>.
These cash proceeds will be using food to reduce it.
Okay and.
Also we have repeat that federal from city Hello.
Yeah can you hear me, yes perfectly thank you.
Thank you. Thank you everyone to sleep at all city.
Three questions. Please Thomas T. Firstly when you initially put that press reach out in June you talks about the transaction and remaining significant shareholder in Shanghai. So could you, maybe reconfirm that or how things changed and can I be cheeky.
What in your view is a significant share holding still.
<unk> of the transaction.
My question to maybe some Victor.
And the market <unk>, it's a longterm growth driver.
You can start you said, 5% to 10% of <unk> coming from G. Sales <unk> are you willing to put a ballpark number. So what were we all ended this year, where we <unk> and.
And then lastly.
Suppose you started here Jimmy Goldens question about the guidance cause I just.
<unk> It makes it more simple is it fair to say the the risks.
<unk> cause there's risks.
Much of the upside Robyn downside is James.
James apply in terms of metallic regarding keeping that 12 to 14, so three questions on rush Zombify and upside risks to gardens, given the key for trying to say.
Thomas Okay, I'll take I'll take the first question and I appreciate that I appreciate it.
With a guard to you know our ownership and all of that we're going to let you know all of the details once once we announce and once we sign but I, but I do want to remind you that we we have a strategic alliance with Shanghai, Ross and we have an album and distribution agreement both that are very important to us.
And also our future precision in China is is important to us in a strategic markets. So as we proceed with this deal all of these pieces will be a very important part as we conclude and sign the deal <unk> on on Shanghai Russ.
The second question Hello, Peter Yeah, <unk> as you probably can see in the presentation. We released the <unk> the the good old space of.
Daniel <unk> hour ibuprofen, it's it's clearly a higher so this is as we <unk> the share of <unk>, it's increasing and we expect this to continue to to continue I dunno exactly afterwards at the <unk>.
But we expect this to represent with a time signature can <unk> as your portfolio.
Alright.
Regarding the <unk> the <unk>.
D. As you know the groceries you know.
Very important to understand that it is based on the baseline Okay. Please year and also.
When you look at some reported basis on the ethics, you know 440, Q for <unk>, but the the <unk>.
The reality is that when when we look at the amount.
The amount of the foreclosure, there's gonna be higher than the than the previous quarter, how worried a baseline various from one to another quarter when you compare with the previous year.
<unk> said that <unk>. This.
This range for <unk> have any guidance for the <unk>.
Thank you.
We have we are coming close to the hour, but we have to follow ups. One from hi may I know the one from Charles Please see if you can make kind of one question H. So that we we can trade with that the session and the first <unk>.
Hi, Thank you yeah <unk> it is fairly quick and easy so regarding the timeline, how you announced the <unk> vaccine resolve first without quite recently and just to know what could we expect a call.
Following the steps.
<unk> call you or you try to give us some kind of.
<unk> and how how excited you are <unk>.
Hi, How're you couldn't go I'm also related with the <unk>.
Dash spot 2018 said that they were going to review the guidelines on that in 2023.
Recommending again <unk> is this something that could be on the table again, you know to try to revive Diane.
The <unk> project with the asphalt well you don't have a lot of expectations from them. Thank you.
Thank you yeah on the on the <unk> vaccine there was a question previous on and yes. It's it's it's program that we are open to other license the the the the financing of this first phase three.
<unk> that it should go it should go now so that's.
That's the that's the status just today Griefers regarding these these vaccine looking for a kind of a partnership here on the on the asphalt inclusion of the Amber protocol into their guidelines. Yes. It has been it has been included in in in <unk> in one of the of the guidelines now <unk>.
<unk> out there for patience.
Regarding the <unk>, we are kind of in a standby mode. We're in touch with our regulatory agencies to see opportunities from on how to proceed but he asks a question yes. It hasn't been included.
Okay, I I'm sorry.
But then is there an annual <unk>.
Hi, I'm.
<unk> recommendation.
Yeah, I'll file to get it into the insurance or any any potential coming from there.
<unk>, we are let's say moving cautiously I should say in the essentials is low okay. We we are trying to understand which are the potential possibilities that we can.
C for this program in relation with the inclusion of the protocol in the in the <unk>.
Guidelines.
Okay and last question <unk> today's session <unk>.
Hello, Charles statement.
Hi, Thank you very much just very quickly can I just wanted to just get it. So I'm just like cut plan that will not happen and you expect to receive and to pay down plus tax amount and then just the actual question I was just talking about the expected potential for other cost savings, giving you you've now they're gonna top end of your target for 23, what other.
Further levels, all that that you're seeking to identify going for it's always the focus very much just a normal operational efficiency cranky.
Okay for the 1.5 this is <unk>.
Is gonna be cash.
Gotcha.
Taxes, when when you receive your cash there's no taxes.
On this and then.
The operational improvement plan.
As we said you know <unk> <unk>, the 150, plus 300 <unk> as <unk> as I said four <unk> 450, I seen that I mean, we we continues working to to exceed that 450, there are some opportunities.
Really made sure my Victor.
<unk>. So this is a non stop I would say working and I'm pretty sure that.
<unk> will come D <unk>.
Thank you I'll find out and thank you everybody for joining us today and <unk> talk to you very soon as say always any follow up any other questions. You may have you can contact us at <unk>.
<unk> relations and sustainability Department and now will be happy to take other questions from all participants. Thank you very much. Thank you very much bye.
Bye bye thank you bye bye.
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