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Hello, and welcome to Verallia '21 Full Year Analyst Call. My name is Ryan, and I'll be your coordinator for today's event. [Operator Instructions] Present on the call today, we have Michel Giannuzzi, CEO; Patrice Lucas, Deputy CEO; Natalie Delbreuve, CFO; Alexandra Baubigeat Boucheron, Head of IR. For now, I'll hand you over to your host, Michel Giannuzzi to begin today's conference. Thank you.
Thank you. Good morning, everyone, and thank you very much for joining this call. So we're going to present to you this morning the financial results of last year, 2021. And I will start, as usual, to remind you the presentation, the general presentation about the company, and the fact that we are today a global leader in the glass packaging industry. As you well know, we are the leader in Europe. And Europe last year represented 89% of our sales. We are #2 in Latin America that represented 11% of our sales and we are the third largest company in this industry worldwide.On the left-hand side of this chart, you see that we have a balanced end market portfolio. We address all the segments of the market with a strong presence in the wine -- sparkling wine and spirits businesses. For historical reasons, we are very present in the 3 largest wine producing countries in the world, namely Italy, France and Spain, and this is showing through the end markets, strong market share in our segment portfolio.When you look at our company profile, we employ 10,000 people in the world. We have 32 glass plants with 58 furnaces. We also have 9 cullet treatment centers and 3 decoration plants. And altogether, we produced 16 billion bottles and jars every year.So moving on now to the highlights of the year. The first thing, which I think you all know about, which is important to recap, is the evolution of the capital structure during the year. We know there have been a lot of activity from our former shareholder Apollo that has sold down blocks of shares during the year. At the end of the year, in December, you see on the chart, that Apollo is no longer at present as a shareholder of this company. We have still BWSA as the #1 shareholder with 26.6% shares of the company. BWSA, I remind you, is a family office fund. The number two shareholder is BPIfrance Participation with 7.5% of the capital share and the third largest group of shareholders are the employees through the FCP or directly, and they own 3.5% of our shares.You remember also maybe that we have during the year, participated to some blocks sold by Apollo, and we bought back for EUR 221 million worth of shares, and that is the 4.5% of treasury shares that we currently hold. We announced also in December, the evolution of the governance. We will dissociate the chairmanship and the general management position of the company after the AGM of May 11. I will remain Executive Chairman of the company. And Patrice Lucas, who joined us in the first of February, will become CEO of the company after the AGM of May 11. We will also appoint a new -- we will propose at the AGM to vote for a new independent Board member, Didier Debrosse, that will replace, who has resigned to -- decided to resign from the company. So if we look also on the CSR front, I think a lot has been achieved during the year. First of all, if you remember, we started 1 year ago in January 2021 by setting quite an ambitious objective of CO2 reduction. We revisited this objective after the IPCC report in August to make it even higher with 46% CO2 emissions reduction by 2030 compared to 2019. This is what allows us to limit global warming to 1.5 degrees C and we are currently waiting for the final confirmation of SBTi in terms of target calculation. But this is just an increased ambition in order to reduce our CO2 emissions even further.I'll remind you that we have also provided raw material mix. And in this shift, of course, we are looking at raw material that are, if possible, without C -- without carbon atoms in it. And the first and best raw material without carbon atom is the Cullet, the used glass, that we recycle in our furnaces. And this is why it's very important for us to keep increasing the share of the Cullet that we use in our furnaces. And I'm very pleased to report to you that we made a significant improvement last year by increasing by 3.6 points -- 3.4 sorry, the share of Cullet in our furnaces. And that represents today, 55% of our external Cullet that we use in our furnaces. So that's, I think, a great achievement on this side.The second pillar is to reduce, of course, the energy consumptions in our operations and mostly in our furnaces. And in this respect, we have also announced in January this year that we will build 2 electrical furnaces in our Cognac plant in France. This will enable us to basically almost half the steel emissions coming from the furnaces by using some low carbon electricity that we have in France for especially flint bottles that we produce in this Cognac plant. And the third lever that we also used to decarbonize our industry is to increase, of course, the share of the green energy. And again, we are very pleased to report that at the end of the year, we had during 2021, 10 of our plants that are using 100% renewable electricity. It's mostly in Iberia and in Brazil. So this was, I think, also quite a strong year in terms of CSR achievements.Now moving more deeply into the technical matters related to the electrical furnaces. Here, you see that the announcement that we made in December -- or December 2021, in Cognac, regarding this electrical furnace. The first furnace will start at 2023, next year, it's pretty ambitious, I would say, target in terms of R&D development. This is a technology that is known and used in the small glass packaging industry for cosmetics or glasswool manufacturing, but not yet for bottles and jars that requires much bigger and larger furnaces. So we're going to try to leverage the existing technology in a much bigger scale. This is unfortunately, technically speaking, restricted to non-colored glass for technologies, but this is quite already a significant amount of our business, which is about 1/3 of our production altogether at the group level.And we reduce these CO2 emissions by around 60% from the furnace every year. And of course, if it works well and depending on, of course, the ability to source low carbon electricity in other countries, we'll look at further deployment in other countries afterwards.The second thing, which I think is quite important, is we were part of the European consortium to develop a hybrid furnace. This was the consortium that with 19 glass-making companies. And we have applied to access to European funds to finance this consortium and this R&D development. Unfortunately, the commissions didn't allow, it was a very good file and that was presented, and we were in the second round preselected for the final allocation of the funds. This project, this FEVE organization that applied for the fund don't receive the funds. And therefore, the members have decided not to continue in this organization, but we have decided that Verallia to keep this project live as Verallia only. By the way, it will probably allow us to go faster, because it's probably faster to be fully in charge of this project.And we are aiming at starting the production of this hybrid furnace in 2024. Again, this is quite an ambitious target and this will allow us to reduce also our CO2 emissions by around 50% versus the conventional. So a lot of projects are currently ongoing in line with our strong commitment to reduce our CO2 emissions.Another good news is we received at the end of the year, the Platinum rating from EcoVadis in terms of sustainability, this is looking at environment, but also labor and human rights, ethics and responsible purchasing. We got a good core of 75 out of 100, improving by 8 points versus the prior year. And this puts Verallia in the top 1% companies that have been evaluated by EcoVadis out of a total of 65,000 companies. So I think we are very proud about, again, this recognition of all the things we are doing in terms of sustainability.Last but not least, in terms of social responsibility. This is a short summary of all the things we are doing that will be able to look in more details in a few weeks when you will look at our extra financial performance report. But basically, we are on the social side, promoting diversity and inclusion. We are increasing the share of employees with disabilities. Of course, our policy is a 0 accident policy in our company, and we are, as you know, very well engaged in the development of the company.Now let's move to the -- I know you are very keen on now moving to numbers. So let's look at the financial results. First of all, the full year in terms of revenue, we have the pleasure to report a 5.4% revenue increase to EUR 2.674 billion and organic growth was 6.8%. So quite a very strong growth. And as you have seen, this has accelerated quite strongly in Q4, because in Q4, we had reported 10.2% organic growth compared to the prior quarter of 2020.We also have the pleasure to report a good improvement in our adjusted EBITDA performance in line with the EUR 675 million forecast that we communicated earlier in the year in 2021. We've achieved EUR 678 million of adjusted EBITDA in the year, which is an 8.4% improvement versus 2020. And margin-wise, our margin has improved by 68 bps at 25.4% versus 24.7% the year before. This translated quite nicely in a strong net income improvement at EUR 249 million at the end of 2021, which is a 19% net income increase compared to 2020. And the earnings per share is EUR 2.01 at -- for 2021. And this is even EUR 2.37 if we exclude the customer relationship amortization that is a purely technical matter.The net debt has been reduced to 1.9x last 12 months adjusted EBITDA versus the 2x of December 2020. This is a strong improvement given the fact that we paid EUR 114 million of dividends during the year, and we also bought back shares for EUR 221 million. Without the share buybacks, the leverage would have been 1.54x, which is also showing a very strong leveraging capability from Verallia. And as I already mentioned, the extra financial indicators that are tracked and the most important ones that are tracked for our sustainability-linked bonds that we have issued last year, The 2 link bonds that we issued last year are CO2 permissions, which nicely were reduced by 3.6% last year for Scope 1 and 2. And as I mentioned before, the rate of external Cullet usage has been increased by 3.4 points to 55% last year.So altogether, I think a very strong year, very successful year in a very challenging environment, as you will know, especially in send part of the year last year. This being said, I will now hand over to Nathalie, who will go through the financial results in more details.
Thank you, Michel, and good morning to everyone. So let me lead you through our usual bridges on sales and EBITDA, and then on the debt figures. So the organic growth indeed has been really strong in 2021, plus 6.8%. And we have had especially a strong Q4 with organic growth up to 10.2%. So a strong end of the year. We've seen growing volumes. And as expected, we are really exactly back to 2019 levels, meaning back to pre-COVID levels.In terms of price and mix, they have contributed, as you can see on this page, up to EUR 103.8 million to the sales to the top line. Sales price important to separate Europe from Latin America. In Europe, sales prices have been flat, and we have annual price evolution in Europe mostly. When in Latin America, we are compensating for inflation throughout the year. So there you have sales price increase throughout the year. The mix has been contributing positively as well throughout the year in the 4 quarters.The foreign exchange is negatively impacting the top line by EUR 33.3 million. This is all stemming from the first half of the year from H1. And some comments by product category. We've seen all products up, except for nonalcholic beverages and food jars, but both these categories have been growing in the fourth quarter. And just to remind that food jars had been especially boosted in 2020 by the several lockdowns and with people cooking more at home. So this is more coming back to normal levels. And sparkling wines and spirits have sharply rebounded with extremely successful years in both segments.Now moving to geography. So South and West Europe. We've seen a recovery in most categories. We have here plus 5% sales increase, and we benefit fully from new collection capacities in -- fully in the second half of the year. We have 2 new plants in 2021, 1 in Spain and 1 in Italy. All product categories here as well have been growing except for the food jars that I already commented. And this still wine have been also growing strongly, spirits as well and sparkling wines, especially strong. This is -- I mean, 2021 is really a record year in Champagne. And Prosecco in Italy is continuing growth and very popular and exporting very well.In beer, we've seen also a good recovery and dynamic sales that we benefit from. And as mentioned, in Europe -- Southwest Europe prices are overall stable.Now moving to North and Eastern Europe, we've seen an improving trend in the second half with positive organic growth. In the first half of the year, we have seen a decrease in volumes in H1 and just also to remind, we are always comparing, of course, with previous year. And in 2020, North and Eastern Europe countries had been hit by COVID and restrictions later than South and Western Europe. So the comparative basis is more difficult for in the first half. And in the second half, we are back to positive growth with plus 2.1%. We've seen a nice recovery in sparkling wines and spirits. Here as well, sales prices are overall flat, so not contributing to the top line. And we have a negative impact, 1.2 points from the Russian ruble and also the in Ukraine. Latin America continues with a very strong growth, as you can read on the chart. At constant exchange rates, plus 39.3%. We here as well contribute 2020 additional capacities also from an outstanding production performance and we fully benefit from the new capacities. Revenue increased in all product categories except here as well food jars. And in this region, we have increasing in selling prices, including Argentina, especially to cope with local hyperinflation, but not only in the 3 countries we follow the inflation to ensure a positive spread. And the negative ForEx impact is mainly stemming from the first half of the year. So now if we move to the adjusted EBITDA, we have enjoyed growth in euro and in percentage, moving from EUR 626 million, up to EUR 678 million and 24.7% margin, up to 25.4% margin, which is a very nice growth. The activity, as you can see on this bridge, has contributed positively up to EUR 29.2 million we benefited from a positive volume impact. And -- even if inventories are still low at the end of the year, I'll come back to that, and lower than we expected, we have had less destocking than previous year. This spread, you can see is positive, but slightly positive. And here, we have had several things to comment.So first, the mix has been positively contributing throughout the year and even in the second half and in Q4 as well. Then for Q4 and H2, we had had a very sharp increase in our costs. And this led to a negative inflation spread in Q4. Especially, we have also a low comparison basis in 2020, but we had also an increase in all the costs. The inflation spread is negative in Europe. And positive in Latin America with as expected -- as I explained already, the continuous pass-through of inflation in Latin America, which you don't have yet in Europe.So in the end, the spread ends at EUR 4.1 million, still positive. The PAP pillar, you can see, is contributing very significantly with EUR 40.4 million and outstanding performance at 2.4% cash production cost reduction and in all geographies. And you can see it contribute significantly in euro and in incremental percentages in margin. And then the last 2 pillars, foreign exchange rates, minus 11.2% -- EUR 11.2 million negative, but mainly from H1. And in the other, we have minus EUR 10.1 million here with several impacts as always, but mainly to comment we had in September a fire in Argentina that is impacting negatively our EBITDA by a bit more than EUR 5 million. And also higher inflation in Argentina for EUR 8 million negative.So looking at this EBITDA margin by geography. So South and West Europe is moving from EUR 419 million up to EUR 453 million. That is an 8% increase in adjusted EBITDA and if you look on the top right corner, you will see the adjusted EBITDA margin percentages. So moving from 24% up to 24.7%. So also an improvement here. The activity has benefited positively -- impacted positively strong demand, and also, as already mentioned, the 2 new furnaces that we started in Italy and in Spain, allowing us to benefit from this positive activity and strong demand. The inflation spread turned negative in the second half, as already mentioned. So this is due to the sharp rise in costs.The positive product mix in all the countries and good industrial performance, this is a PAP, I'm referring to, despite difficulties in France in Q1 linked to the completion of the transformation plan.North and Eastern Europe is decreasing in euro and also in percentage. So to comment here, we commented the -- we discussed the volumes and the activity. But here, we see a recovery in H2 after a slight decline in H1. And the spread is negative in North and Eastern Europe as well, same pattern as South and West, I mean rising costs and flat prices. And what's important to mention that industrial performance is in line with the cost reduction objective and so contributing to the EBITDA here.Now moving to Latin America. You can see the significant margin expansion. We moved from 33.8% in 2020 up to 35.6% in 2021. And in euro, the adjusted EBITDA moved from EUR 80 million up to EUR 108 million. And if you take out the exchange rate, negative impact would have been EUR 118 million. So really outstanding performance in 2021 for Latin America. And here, our 3 pillars fully deliver, meaning we enjoy strong growth in sales volume. The market is dynamic, and we had the effect of the 2020 capacity extension as well. Positive inflation spread throughout the year, and outstanding industrial performance. Also to mention that in H1, we benefited from specific measure ICMS tax credit that is EUR 7 million, but on the other side, in a negative part, we had the fire impact in Argentina in Q3.So moving to CapEx and cash now. We are very keen into having a smart CapEx policy. So you can see here our total book CapEx as a percentage of sales are 9.6% for 2021. This -- we want to stay into an envelope of around 10%. So we are absolutely in our objective. And this includes EUR 50 million for our new furnace in Jacutinga in Brazil. And also, we start to have investments for our CapEx road map in order to reach our emission reduction objectives. So you -- this CapEx includes EUR 13 million of this CapEx.Now our cash flow generation has been very strong this year again. You can see here the operating cash flow construction and also the free cash flow now. It starts with growth in adjusted EBITDA in the first line, of course, in euro, contributing. Then we have a high level of cash conversion, 62.2% in 2021 with the CapEx well under control. We have had significant positive change in operating working capital with EUR 80.5 million. And here, we have had, in fact, stock variation. Our stock, we didn't succeed into rebuilding our stock as high as we would like. So we have a negative variation of stock, but not so significant, only minus EUR 70 million. And then for receivables and payables, they have been contributing very positively to our working capital. Overdues are important to mention that they are very well managed, have been stable and at a very low level in 2021 in all the countries this year again. So operating cash flow ends at EUR 500 million to EUR 502.3 million, improving versus 2020. And then to move to free cash flow. We have other operating impacts that include IFRS 16 impact that is overall stable every year between EUR 18 million in '20. This is minus EUR 18 million in 2021 and several impacts that are not in the adjusted EBITDA that have a cash effect, such as the cash out for transformation plan in France and the Phase III settlement for CO2. So at least 2 other operating impact of minus EUR 39.8 million.Then we have interest paid and other financing costs, minus EUR 41.8 million, increasing a little bit versus 2020 due to some ForEx and also to the 2 sustainability linked that we raised in 2021. And finally, cash tax, minus EUR 91.4 million. And here, we have a normalized effective tax rate of around -- 26.6%, not around. And in 2020, we had positive impact of patent box in Italy for EUR 10 million. Plus, I mean, the increase in value is also linked to the increase in the results just basically. This ends with a free cash flow at EUR 329.3 million, so very strong and high conversion of our operating adjusted EBITDA into free cash flow. So leverage is below 2x. And important to note is after dividends payment. You remember in 2020, part only of the dividends have been paid. The other have been converted into shares. In 2021, the full dividend has been cashed out for EUR 114 million. And we've performed several share buybacks for a total of EUR 221 million. So as you mentioned, Michel, excluding the share buybacks, the leverage would have been 1.54x. So deleveraging of 5 turns since 2020. And the fact that we are below 2x allows us to benefit from 25 bps lower interest in our TLA and RCF. So that is a positive impact in our financing cash out.And now to finish with this picture of our funding. 2021 has been a very busy year for us into diversification and lengthening the maturities of our fundings. When we had 1 significant term loan A with EUR 1.5 billion. As you can see on this chart, we are now very well balanced between bonds. Two sustainability-linked bonds have been issued this year. And we have now a maturity between '28, '31, 2024, when we all had in '24. And the liquidity is very comfortable at EUR 844 million.
Well, thank you very much, Nathalie. As a summary, I think we are really pleased with the strong performance of last year, especially given the huge surge energy costs that started in September, October last year with a very significant impact on our Q4, of course, EBITDA. And despite this, we've maintained a very strong performance in all respects, in all top line growth in EBITDA in line with the guidance that we gave you middle of the year. And also in the extra financial indicators, to repeat main KPIs that are being used in the certainty linked bonds that are CO2 emissions and external Cullet usage rates have also very nicely improved last year compared to the year before.As a consequence, we are going to propose to the Annual General Shareholder assembly to pay a dividend of EUR 1.05 per share to all shareholders, which is a 10% improvement or increase versus the prior year, which was EUR 0.95, and this is in line with the guidance that we provided during the Capital Market Day of October last year.Now let's move to now very interesting outlook of 2022. Before, I'm not able to forecast all these curves going forward, but I just wanted to maybe put things in perspective. And we've gone back on those 4 main energy components, the Brent, Natural Gas, Electricity and indirectly linked to energy, the CO2 Quota prices. I went back to 2007. So over a 14-year period, you can see the evolutions of these curves. The Brent has been up and down, but we use very directly very little Brent or gas or fuel Energy, it's mostly indirectly through our transporters that we see the impact of this Brent increase. However, you know very well that our industry is quite energy-intensive and the 2 main energies we use are natural gas and electricity. And when you look at the spikes that we've seen in Q4 of last year, both for natural gas and electricity and consequently, for the C02 quota prices, this is just unbelievable. I mean this is a -- I have never seen increase in such a short period of time of energy costs and indirectly of CO2 quota. I mean CO2 quota has been almost reached -- which almost reached, sorry, last week, EUR 100 per ton coming from around EUR 18 to EUR 20 per ton, not so long ago.So on top of this high unprecedented inflation factors, you can see that there is also a huge volatility. I mean it's -- and that's why I think it's important to see that not only it's a huge surge in those costs. But there is also still a lot of volatility in what's going on there in the marketplace. Now you know very well that we are hedged for 85% our mix for next year -- sorry, for 2022 for this year. But we still have 15%, which is not hedged. Now this 15% not hedged are exposed to both short-term energy price variations. And it's not just a question of demand and supply. This is also very much driven also by some geopolitical considerations.Therefore, the outlook that we are going to provide to you today to you is, first of all, based on a few assumptions. The 3 assumptions that we have taken is the fact that we seem to be exiting for the hard lockdowns linked to the COVID-19 pandemic. And we've seen -- it seems that things are normalizing step by step. And therefore, we don't expect another wave of another, I mean, Greek letter impacting the people health. And therefore, that's 1 assumption we make. We make the assumption that the inflation costs and geographical context do not deteriorate further. You all know every day in the last few days, this has been extremely tense in terms of what is going to happen, especially in Eastern part of Europe. And this is, of course, creating some volatility, as you all know, in the market. So based on those 3 assumptions, we're going to have a strong growth of annual revenue. Given the fact that we're going to increase our prices around 10%, as we mentioned before, and double digit. This is needed to, of course, mitigate the strong impact of production costs increase, mostly coming from energy, with the aim at some point to achieve a net spread, 0 spread.But this is, of course, still to be seen depending on how the energy prices go -- evolve in the future months. And as a consequence, we are aiming at having at least EUR 700 million of EBITDA in 2022. Of course, going forward, in the next quarters we will be probably able to precise -- to give you a more precise guidance when we see things stabilizing at some point in time, especially on the geopolitical side. We hope that at some point in time, things will get clearer and less volatile. And last point I would like to highlight is the fact that mathematically, the strong increase in revenue due to the strong price increase to offset the cost inflation is going to be dilutive on the EBITDA margin. Just mathematically speaking, and this is, I think, in the appendix, you see that all things being equal, if you want to increase a 10% increase in cost if you want to offset it by the current price increase, this has mathematically dilutive impact of 180 basis points of the margin -- of the EBITDA margin. So this is something, of course, that has to be understood, which is highlighted here.On top of this, we will keep working very hard to implement our road map related to ESG and more precisely around environmental performance KPI like CO2 emissions actions and like the Cullet rate. As you've seen, we are committed to keep improving on these 2 KPIs as committed to during the SMB -- sustainability bonds that we announced last year. So that's it for the presentation. I would like to maybe open your discussions on the Q&A session.
[Operator Instructions] For now, we have our first question from Matthias Pfeifenberger from Deutsche Bank.
So firstly, on pricing and on the price cost. I mean, there has been a negative in the second half in most parts of Europe. Are you not a bit underwhelmed by that, not really satisfied and what are you -- how are you making sure that the price cost is a bit richer this year? You just alluded to that, probably you're going to go for a positive price cost towards the later end of the year. Why is that the case? I mean is that just philosophically, you're not trying to overburden your customers and you're working on the EBITDA improvements on the self-help side, and that's enough. Because it seems like you're holding a lot of cards when it comes to pricing like everybody is sold out, record Champagne volumes, probably more efficient hedging than some of your peers. Why is now the price cost spread guidance more moving towards neutral rather than tangibly positive like you had it before?
Thank you for all these questions. First of all, if we -- there were a lot of comments and questions, so I'll try to answer them all. And if not, just don't hesitate to ask again. First of all, regarding last year, in Europe, when the huge surge of energy took place in Q4, you know very well that in Europe that the prices are fixed for the full year in most cases. So only a few customers -- only with a few customers and distributors, we've been able to immediately react and increase prices in Q4 last year. But for most customers, the annual price negotiations takes place between October and February and are applicable as of January 1. Therefore, Q4, we had the prices that have been set at the beginning of the year and the energy cost that especially for the non-age part of it that was unfortunately hitting the P&L in Q4.And all this led to a negative spread in Q4, which was somehow difficult to avoid. I mean, there was no possibility to avoid it. It was too short term to react. Given I repeat the magnitude of this inflation on energy cost, because even if we are hedged, as you know, for 85% of our volume, just if I just take the gas price, it moved from EUR 21 per megawatt in Q2 last year to EUR 80 per megawatt in Q4, less than 6 months, it's too short. So times for on 15% non-hedged gas, for example, you can imagine has a significant impact on our cost base. And I repeat, it's not the fact that we are holding or not willing to go to the customers. We've done it. But with many customers, the negotiation was basically to prepare the first of January new price. We had very few opportunities to renegotiate Q4 prices. Now regarding...
But this is exactly the point so now for 2022, you're talking about for it to not be clear at this stage if there will be a positive price cost. But so the question is quite frankly, why don't you raise prices more?
Okay. I'll come to it. So that was -- I was answering first part of Q4. To clarify your comment about Q4, which I believe needed some clarification. Now regarding '22, it's another story. And again, I think we are exactly in line with what we discussed during the Capital Market Day and later on during the presentation of the Q3 results back in October last year. We -- our goal, and we started to anticipate the fact that there will be a huge cost increase in 2022. Our goal is to have a neutral spread, which is by itself quite a challenging goal. Because when you look at this kind of inflation, I think a positive spread is, I think, quite an achievement. So yes, in the past -- and by the way, as a reminder, we always said that our goal was to have a positive spread. In reality, we've always been able to do better than this, okay? When you look about our history, we've always done better than positive. But the company, the 3 pillars of this business model that we set up for Verallia is based on a positive spread.And 2022 will be, of course, a lot more challenging to achieve a positive spread given this kind of inflation that we have in front of us and despite, of course, the hedging that we have in front of us. Now you could say, and this is your point, but it's early guys just increased prices more than 10%, go of 15%, 20%, 30%, fair enough. But at some point in time also resistance from our customers. There is a competitive dynamics also with the other competitors in this marketplace. And already, I mean, reaching a double-digit price increase, which is what we told you was our goal is, I think, already coming from the history of no inflation in Europe. There has been no inflation for many years, is already seen as a great achievement and a great, I would say, challenge for our customers. Now some of our customers will not be able to pass the same amount of price increase to their final clients. And again, I mean, we are here for the long term and a negotiation at the end.
Fair enough. Just to be nagging on this a bit more. Last time, you told us you're approaching the clients with the spot curves, but you hedged at way below spot rates on energy. So -- and then also when I look at ore card, for instance, they are guiding for higher margins. So it seems like they are well able to adjust higher packaging costs, which are only like 3 to 10% of the total cost of debt average anyway. So isn't this a bit like looking out too much for the clients? And then -- but maybe we have talked about this enough.Can I come back to a second topic, which is the margin?
Can I just make the comments on this. What you need to -- I think your comment is a fair comment, it's a good comment. But in our customers, we are #1 in Europe, okay? And as you know very well, we address all end market segments, from the premium customers with the premium products to mass market products. Now on premium, you're absolutely right. On the premium products, our customers are able to, because they have the pricing power, they have the marketing strengths, they are able to pass to their final clients the cost increase, the price increases that they want. And therefore, there's probably less price sensitivity for the premium customers. And good enough for Verallia, we are pretty well positioned for the premium segment. But I'll remind you, based on the just Capital Market Day presentation, the premium segments, roughly speaking, represents only 15% of our sales. So 85% of our sales are on the mass-market segment and here the price sensitivity and the ability of our customers when we deal with, for example, the big retailers or big distribution companies, the ability to pass the price increases is much more limited. And therefore, I mean, it's a mixed bag of different customers.
Yes. Fair enough. Just 2 remaining topics, margins. You noted previously that the technical evolution could be 100 bps, something like that. And that you would work against that with sales happen restocking and volumes and probably a bit of price cost. Do you still stand by that? And the last question is the hybrid furnace. Why was this canceled? I mean it's so many companies that have already done press releases about aiming to engage in hybrid furnace concepts, now it's canceled.
Well, the first 1 on the margin, I will let Nathalie.
On the margin, Matthias, I can confirm, yes, we have the adverse impact and really mathematical impact of the dilution. And as Michel explained, just mathematically pushing the cost to ensure a positive spread and raising prices by 10% is dilution of 180 basis point. But you are right on the other -- in the positive way, we still have offers our PAP. And you've seen that we continue to deliver very strongly on the PAP. 2021 was, again, a very strong year. And yes, we expect a positive activity as well.
Okay. So could this be 12%, 13% top line growth including volume and then maybe, I don't know, 80, 90 bps of margin dilution, too early to tell?
Probably a bit early, we are only at 17 for February, Matthias. This is why we will provided you already a guidance, which I think given the volatile and the uncertainty of the market is challenging exercise, and we'll provide you a guidance today, which, of course, will be more precise in the coming quarters. As some element of elements of volatility and uncertainty disappear, we'll be able to firm up our guidance. But of course, as soon as we see more clearly the geopolitical context, they were evolving and the prices at some point, stabilizing, we'll be able to give you a better guidance.Now regarding the furnace your question, this was -- this consortium that was set at the European level with 19 glass-making companies was very strong and very new initiative, very innovative initiative. But it was based on the fact that this consortium will get -- not on the fact that we is, that this consortium will get some grants through the European Commission put aside EUR 1 billion of grants for decarbonizing projects -- decarbonization project. And unfortunately, despite the good work done by the consortium, we -- the consortium did not receive the grant. And therefore, the burden for all members of the consortium to finance this project was considered by many smaller players [indiscernible] as too expensive, and therefore, people started to -- I mean, decided to stop the consortium.And our position is to say, okay, we will carry on this project alone. Basically, we'll develop the R&D alone. And this is not at all reducing our ambition in, which is the opposite, we think we'll go faster by developing the project alone than with a consortium with 19 companies that is always a bit harder to manage in terms of speed and flexibility.
So our next question comes from the line of Lars Kjellberg from Credit Suisse.
Just continuing on the same theme about one for the future. It's kind of difficult to understand. So your consortium of companies not finding it any longer financially viable. And you talk about some companies thought it was quite expensive. And so what does that mean when you go alone? What sort of costs are you shouldering to develop this technology? And what sort of risks are associated with that? That's my first question. Also, if you can share with us how you think about the market outlook for next year in terms of -- you mentioned prices, of course, right, but if you look at volumes, you essentially now back to pre-pandemic levels, which I assume was about 2% growth in 2021, but that means essentially you have 2 years with 0 growth. So how should we think about European growth as some sort of normal trajectory? And the final 1 would be on CapEx for 2022. And how do you think about the new technologies, is that an incremental CapEx that you need to spend now versus the sort of 10% that you've already spoken about?
Regarding the first question about the hybrid furnace. No, I think it's pretty clear to understand. 1 company in the consortium was going to develop -- or doing the consortium project time to develop the furnace to -- and it was an industrial project as -- in this case, it was a project where the would produce that will be sold. So the company will have an additional cost of R&D and initial cost of CapEx and OpEx. But the company that will, of course, develop this furnace, would enjoy the revenues and the margin of these products being manufactured in each furnace. All the other 18 companies will only access to the know-how. So they were paying -- basically, it's pay to see. They were paying to see the efforts and the R&D results made by this company that took the responsibility to develop the furnace in the future. So therefore, it was somehow -- you can see it as a cost to learn from the company that has developed or was going to develop the furnace. For us, the fact that we do it alone, of course, will probably bear higher R&D costs to develop it. But in terms of CapEx, it's probably more expensive. It is, not probably, it will be more expensive than traditional furnace indeed. But we will have -- on the other side, the revenues and the margin for these products -- and you can count on us to be able to use the fact that these articles -- these products that will be produced in this furnace with 50% less CO2 emissions, we are going to, of course, part of our pricing strategy value this for our customers, because I think that has the value. And therefore, we expect to get even a higher price to reflect the higher cost that we will enjoy -- that we'll see, sorry, with this new technology. So altogether, we will take care of the R&D with our own R&D team. By the way, we are 1 of the 2 companies that have in-house design teams for furnaces. So we have the capability and experts that know how to design furnaces, but we don't even need to subcontract this activity -- R&D activity to a third party. And we will get the nice revenue stream and profit from these new furnaces, which was not the case in the previous consortium situation.
So as a follow-up question, if I may, on that. Do you -- the technology itself, what you've seen from, I guess, Ardis building this thing. Is that a functioning technology, it's proven or do you need to develop the technology before you get cracking on actually building the furnace?
Well, we are -- again, we are -- it's a bit like difficult ones to some extent in a different situations. But we are at the limit of what we've ever done. In other words, the technology -- the issue is very industrial. It's -- technically speaking, we think it's feasible. And of course, we have a great confidence that we will find a solution, but it has never been done before. So therefore, we will probably encounter some challenges, some technical challenges, that our teams will have to, of course, face and solve. But it's not -- it's beyond belief that we've currently applied in our design expertise, if you design expertise, but it's not something that is as always, we, of course, will be less confident and we'll probably not communicate on something that we don't think we can do. So that's something that we believe we'll be able to, of course, set up and run in the mass production environment in the years.So regarding your second question, the market outlook. No, I mean we've had -- you've seen that from -- again, I refer to the Investors Day, the Capital Market Day that we cover -- this European market has been growing steady at more than 2% per annum in volume. Right now, I have to say, and that's something also that somehow Matthias alluded, we are sold out, as you know, since last year. Actually, since mid of 2020, we've been sold out. So we are producing as much as we can to deliver to our customers. The market is still very strong in Europe. It's buoyant in Latin America, as you well know, and that's where we're going to put 2 new furnaces in the next 2 years in Latin America. We will put the third furnace in 2024 in Italy. Because we believe that this market is still growing at least at 2% volume per annum.And our goal is really to keep this -- to enjoy this market growth in the coming years and especially in 2022. So back to the numbers, I mean, we are going to get a double-digit revenue increase, because of the 10%-ish price increases and also some volume increase, which we expect to be around 2% in Europe. Regarding the CapEx, I'll let Nathalie answer the question about the CapEx.
Yes. Thank you, Michel. So regarding the CapEx for 2022, we aim at keeping around 10% of sales for total CapEx as we guided, and we'll begin to stay around 10%. And this includes, in fact, the CO2 CapEx road map, which we communicated in January 2021 with a road map of EUR 180 million for the next 10 years. So it is an envelope between EUR 15 million and EUR 20 million per year. And this also includes the end of Jacutinga gas. So it's all included. So around 10% again.
And there's no consideration to the surge in revenues that would come slightly below 10%? Or is it just that things are some more expensive as it's still going to be around 10%?
We will be around 10%, probably a bit north. Last year, we were below 10%, 9.6% will be -- a bit higher than 10%, but it's between 10% and 11%. I would say not more. And this is all included.
Our next question comes from the line of Guillaume Muros from Societe Generale.
And I have 2 questions. First 1 will be on the general situation for other European players on this inflation context. Are you seeing financial situation deterioration at other players that cannot possibly pass on the same price increases as you are? And would you be keen to benefit from, let's say, external growth opportunities given your solid cash position? That's the first one.And the second one, more on ESG. Are you planning your new CO2 reduction targets and to link them as well to your capital structure through ESG linked bonds?
Okay. Thanks for the questions. Regarding the financial situation of our peers, it's too early to know exactly what is the financial impact on our competitors. And I remind you that we can only easily access the listed competitors. And there are many competitors in Europe that are family owned and privately owned and that are not necessarily publishing their financial results. But 1 thing for sure is that many competitors are suffering. Just to give some examples that are public information. 1 of our German competitor decided not to start 1 of its furnaces. With brand new furnace that we had built, because if the cost of energy was so high that it will not be a profitable thing for him to start. We've seen some similar situations in other countries where people decided to slow down, especially in Eastern Europe production because of the high cost of energy. So it is certainly hurting everyone. This huge surge of energy cost is hurting everyone. As we said, we believe that we are well positioned to take opportunity of acquisitions. In the case, these companies will, at some point, be open to discuss and sell their businesses. So we are, of course, going to be very, I would say, close to the market in order to understand what the opportunities this could create. Regarding the second question, I will let Nathalie answer.
Yes. So our 2 sustainability linked bonds, indeed, they are aligned on already the trajectory that we communicated in January 2021. And -- but using the -- an intermediary target of 2025 that is already corresponding for CO2 emissions to 15% decrease versus 2019, and with a target of Cullet rate up to 59% by 2025. So we are already fully aligned in that respect.And in terms of financing, as you could see, I have shown. I believe we are now pretty well balanced the debt market with EUR 1 billion, 2 bonds of EUR 500 million, and bank financing and all those things. So I'm not sure we will run from -- for another SLB in the short term. And on top of that, I mean we are very pleased that we did these 2 SLB. I mean the timing for us was a good decision looking at the curve of the interest rates currently.
Our next question comes from the line of Francisco Ruiz from BNP Paribas.
I have 3 questions. The first 1 is again on inflation. So keeping the current situation in terms of energy, could you give us an idea of what would be your inflation -- your cost of inflation for 2022, if everything remains as it is right now? I mean, I don't know if the inflation that we have seen in Q4, I mean something like around EUR 65 million in the quarter could be a good indicator at least for the first 3 quarters of the year. The second question is on the working capital, which has performed, especially well for last year. With inventories have just set at low levels, but a very good improvement in receivables and payment days. So could you explain us a little bit what was the reason? And if you could give us the detail of balance sheet factoring at the end of 2021? And the third question is on the electrical furnaces in Cognac. So could you comment if this will imply an extra CapEx or you are linked to this that you have recently mentioned. And if there is an additional capacity or this will substitute existing furnaces?
Francisco, thank you very much for your questions. I will start with the last question. Regarding the furnace in Cognac, the idea is to replace the furnace, which will come to the end of its life free in 2023 and of '24. So therefore, we will put, why did we say 2 electrical furnaces is because the capacity -- the production capacity of 2 electrical furnaces corresponds equalizes the existing conventional furnace capacity. Therefore, it will be a substitution and to make it clear. So it's not additional capacity. It's a substitution.And in terms of CapEx, this is factored in the 10% each CapEx on sales ratio that Nathalie mentioned just a few minutes ago, it's all included into this ratio.
Could you give us an idea of vis-a-vis the CapEx of electric furnaces or replacing with electric furnaces or a normal furnaces, how it compares?
It's a bit early to be honest with you, because our engineers are still working on the precise design of the furnace. We know for sure it's going to be more expensive, but how much more expensive it is I don't know. But given the fact that we spent around EUR 250 million of CapEx every year. I mean, if you look at the extra CapEx that it represents, it will not be materially impactful in terms of total CapEx spend by the company. But it's more expensive than a traditional furnace. If you take the traditional furnace, it's around EUR 10 million to EUR 15 million investment. This will be probably north of EUR 20 million, but I don't know exactly yet how much it will cost. Okay. Regarding your first question, it's harder to give you an answer on the cost inflation. First because you know very well, we don't want to disclose at which price we have hedged the energy costs. We have a very automatic hedging policy, which is nonspeculative, but we don't want to disclose this information for competitive reasons. So we are not going to be able to answer this question, unfortunately. And I will let Nathalie answer on the working capital question.
So the working capital, so to comment first, the variation in 2021 for you, Francisco. The inventory in volumes, so kept low at the end of the year. compared to 2020. And in fact, we have a slightly negative impact in this year variation. But it's EUR 17 million. So EUR 17 million, it's limited and it's mostly due to hear some inflation in the production costs. Then receivables have been really strong. The balances were really strong at the end of the year. Again, I mentioned that we had a very dynamic Q4, especially compared to December 2020, we had better sales. So the balance of receivables at the end of the year is higher. And we had partially some price increases if you think of Latin America, but also a little bit in Europe and a good mix. So the balances were quite good. You asked about factoring of this receivable here. We are in the same programs as before. So just -- you will see in the notes to our financial statements, the nonrecourse balance that we factor was in 2020, EUR 302 million. It was EUR 335 million at the end. The increase here again is more linked to the increase of the balance of the receivable, the position that we had at in December. But no change in our programs or our policy. And then eventually, the payables, the suppliers went significantly up due to inflation at the end of the year. So the valuation here is very positive for us. So for 2022, again, our target, especially on inventory to rebuild inventories. So here, we feature a negative impact if we succeed into rebuilding these inventories, and we have room in our free cash flow generation to do that.
Can I do a follow-up on inflation. I understand that you are not disclosing the energy cost inflation, but could you give us an idea of this EUR 65 million per quarter of cost inflation, which is something like around 12% overall, not only in energy cost inflation for the year. It's reasonable or not?
Well, no, I'm sorry, I will not be able to give you more precise information. As you can understand, it's very sensitive information that we don't want to disclose, because that will give you the information, but -- we are hedged. But as we said always, this is not something that we want to disclose to our competitors. We already disclosed a lot about our hedging policy. We don't want to disclose the level at which we are hedged to. So unfortunately, you have to make your own assumptions on this one. But based on the on the fact that we'll be about EUR 300 million EBITDA on the fact that we have a little bit of growth and a little bit of -- and a also not a little bit, but the I'm sure we can find out what will be the impact. Having in mind that we are always -- with this EUR 300 million of floor -- sorry, EUR 700 million of floor EBITDA, we are always a bit cautious on the exchange rates. You know that every year, the last 4 years, every year as we had a negative headwind on the exchange rate side. This year, there will be elections in Brazil. We don't know what the exchange rates will impact be in Eastern Europe with what is going on with Russia and Ukraine, we might see on the road on the currency side, too. So therefore, in this -- one of the reasons why we start the year with quite the floor in terms of guidance is because we have also to bear in mind that we could have a negative impact on exchange rate, and that was included in our guidance.
Our next question comes from the line of Jean-Francois Granjon from ODDO BHF.
Four questions from my mind, please. The first one, could you comment on the mix positive effect you mentioned in '21. Could you give -- explain -- give us more color about the positive mix effect in '21? And what do you expect for the mix effect in 2022? My second question concerned -- so the trend for the EBITDA margin in '22, yes, I want to understand. Could we expect an EBITDA margin between 23% and 24%, do you think this is a well magnitude for the EBIT margin in '22 due to impact the mechanical impact of the price increases for sales?And my third question, regarding the PAP plan. Do you expect the magnitude, I would say, EUR 35 million positive impact from the PAP program compared to EUR 40 million last year? And my last question, due to the pressure on the EBITDA margin, do you confirm -- are you comfortable with the long-term target for 2024? You mentioned during the Capital Market Day to expect between 28% to 30% for the EBITDA margin.
All right. Thank you for your questions. I will answer the 3 first. So your first question is on mix. So indeed, mix effect has been positive throughout 2021 and in all quarters. And again, quite good and strong in Q4. I mean we have seen a rebound as we commented in some segments that they are more premium products like sparkling wines and spirits, and also some premium still wines. But also an important point to have in mind is part of this mix is linked to the shortage that we have and the difficulties we have to serve all the demands of our customers. So then we select -- we do some selection in the production and try to serve the highest margin and a better mix to improve our mix of voluntary on this one. So for 2022, what we featured is more -- a more natural mix, because this has limits, and we believe it will come back to a more normal mix. Then second question on the trend of EBITDA margin. Here, again, we say there are adverse impacts, the dilution of pushing prices, pushing inflation and positively offset by our PAT. So you were mentioning 23%, 24%, I would say more around 24% on this one.Then your third question about the PAP, we explain always and what we do, in fact, deliver steady improvement in the PAP. So yes, the answer is, yes. You can count at least EUR 35 million of PAP improvement. Indeed, we did even deliver more than EUR 40 million in 2021. We will try to deliver as much as possible, but the EUR 35 million for us is the minimum.
And I would take the last question, Jean-Francois. The long-term target of 28% to 30% -- 28% to 30% EBITDA margin is clearly maintained, though, as you understood, we didn't anticipate the first year, which is 2022 to have so many headwinds and especially the mathematical impact of the strong price increase impacting negatively the margin, but we are still eager to achieve these kind of levels by 2024.
So our next question comes from the line of Peter Testa from One Investment.
I'd like to just try to understand a few things on the timing factors around price and hedging. Can you give a sense, please, just on the hedging, whether there's a particular degree of that 15% that's open different H1 and H2? And then on pricing, you mentioned obviously, you try to get the prices to start from January 1. But should we regard that as all of the pricing is coming through January 1? Or will it phase through the period?
So on hedging, in fact, we have really a systematic approach quarter-over-quarter. So to answer your question, no, there is no specific big discrepancy between H1 and H2 to answer your question.
So regarding your question on price increases, Peter. Most antis Europe and Latin America, we increased mass anytime during the year in Europe. Most contracts are annual based contracts, where price increases in most cases are applicable January 1, but not allows the case. Sometimes it's March, would be April, but I would say the bulk of it, I don't have a precise number, but I would say more than 80% of them are applicable as of January. However, let's be clear, because we are in an extraordinary situation today, should we see an additional extra -- extraordinary situation going forward, we might and we've already told our customers, we might come back to them again middle of the year. So depending on how things evolve going forward, we might go back to our customers during the year this year, which is not -- which has not been done in the past, if we need to. So the bulk of the contracts would be applicable from January 1. I would say roughly more than 80% and about 20% of the contracts will be spread out during the year, during the first -- the next month, I would say, not year but the end of the next month.
Okay. And when you say you make an assumption on -- for the year on the unhedged part, are you using the current prices for those 3 key inputs or something different of the full year?
We are assuming more or less the current level of energy prices.
Right. And then I had a question just on understanding volume impact. You obviously had a good volume probably people are not lending you build inventory holding on ahead of the price increase maybe. But last year, you also had the furnace rebuild loaded impact in H1, particularly Q1 and some in Q2. And I was wondering whether if you look at the volume impact as you start the year with the timing of the furnace we build, whether we should think about something different in terms of phasing or volume impact net-net with the rebuild?
No. This year, we'll have a more normal split of furnace for the year. So you should not see -- last year was very different compared to 2019. It was completely swing of furnace repair between '19 and '20. Therefore, it made the difference quite big from 1 semester to the other. This is no longer the case. So this year, we go back to something much more balanced between H1 and H2. So you should not see big variations due to furnace repairs.
So our next question comes from the line of Jordan Megan from BNP Paribas.
I've got 2. Firstly, on the close to EUR 300 million free cash flow this year. You're targeting another EUR 600 million in the next 2 years to get to your cumulative target. We had some one-off buybacks from Apollo's share sale. I think even if you increase the dividend by 10%, still a decent chunk of excess free cash flow left there, if that materializes. So my question really is how do you plan to allocate that?And my second question, connected to that slightly. Slide 23, you noted you're on an investment-grade trajectory. I'm just sort of wondering how important is that to the company as a target?
For the first 1 regarding the cash flow. Clearly, I mean, this year we are going to, of course, as usual, generate a lot of cash. Although, as Nathalie mentioned, this year, we will have probably to rebuild inventory. So therefore, we won't have a nice and strong contribution of inventory decrease that we had last year and the year before. But having said that, we will still generate quite a lot of cash. This cash will be used first of all, to finance our CapEx, as we said before, and we -- probably a bit higher than 10% this year. It was a bit lower than 10% last year. It will be a bit higher than 10% this year. Secondly, as we mentioned before, we look at acquisitions. So we hope to be able to make some acquisitions, and that will be the best use of our cash, because we believe it can create a lot of value to our shareholders going through acquisitions. And this is, of course, after having paid the EUR 1.05 per share dividend. So that's -- and if we still have excess cash on hand, we might consider share buybacks. But speaking with all the share buybacks we did last year, probably that will not be a short-term necessity or a certain need if you want. And regarding the commitment we took, it's not a commitment the fact that we want to be on an investment grade trajectory. It's not a commitment per se, just the fact that mathematically speaking, again, with all the cash we generate, we should this company in a way that should please our debt providers.
So our next question comes from the line again of Matthias Pfeifenberger from Deutsche Bank.
Two additional ones. So firstly, can you maybe comment on Russia, Ukraine, any exposures? And then maybe on the separation of the Chairman and CEO function. Michel, do you want to comment at all? Maybe give us background in terms of your commitment to the company, maybe also with regards to some increased capacity to look at strategic things like M&A. Is that part of the consideration?
Okay. Matthias, I'll take the first one. So in Russia, we have 2 plants. So -- and the sales are below EUR 100 million. It's around EUR 87 million and EUR 90 million sales that we have in Russia, with a positive EBITDA. So this is the exposure. And in Ukraine, we have 1 plant that is not on the exports -- politically exposed region.
It is in the west part of Ukraine, close to the Polish border. So it's very far from Kiev.
Absolutely. So...
Less than 1%.
Right, it's less than 1% of our activity, the total sales are above EUR 50 million.
And regarding the separation of responsibilities at the Board level, as I communicated, I will stay close to the company. I'm not going to take another CEO position in another company. And my main primary focus, of course, beyond the fact that we need to -- of course, there's quite a lot of work to do to manage the Board, to give all the, I would say, regulations that the Board has got to face. My main, I would say, priority would be to work on strategic topics and especially on the M&A side. As we mentioned before, it requires time to get close to the company that potentially could be interested to buy, and I will work together with the company to, of course, see if we can accelerate our acquisitions as we would like to.
So we have no further questions in the queue. [Operator Instructions] Hosts, we have no further questions in the queue, so I'll hand back over to yourself.
Okay. Thank you very much. I think we have a question on Internet, but most of them have been already answered. So I will read them very quickly, and I think it will be pretty fast. The first one was on profit margin, EBITDA margin in LatAm in structurally higher versus Europe. Is this caused mainly by the fact that prices are negotiated more often and with more flexibility in LatAm than 1 Europe?
Yes. So for Latin America, as I explained, we are really fully benefiting from our 3 pillars. So there, the market is really strong. The demand is strong and the market is short of glass. So we benefit from that fully. The activity level, the operating leverage is good. The performance in the plants is very good. And indeed, we pass through the inflation to sustain the margin. So that's the explanation about the strong performance.
Thank you very much, Natalie. One that has not been covered and wasn't. Let us know how you contract our structured needed and through with negotiated, you touched on ?
Yes, just to remind everyone, again, we exclude in Latin America where we renegotiate prices as often as needed. In Europe, more than 80% of our contracts are -- it's a repeat business, our annual-based contracts, where every once a year, usually and really more, we negotiate volume and prices with 1 customer. And that is locked for the year. Now there are less than 20% of our contracts in Europe where we have long-term agreements. Usually, it's a 3-year agreement, where we have formula or pre-agreed price increases. And when we have formulas, they are based on indexes and these indexes are revisited once a year to take into account inflation factors. And that makes the prices being adjusted only once a year.I know it's quite different, for example, in North America, where they have quarterly adjustments. But in Europe, the practices you need to have an annual adjustment on price.
And the last 1 may be. What is your feeling on 2022 consensus of EBITDA around EUR 730 million? Is that completely out of which aren't that feasible?
Well, I don't like so much commenting the consensus, but I think the main takeaway on this topic is the fact that we provide a floor of EUR 700 million given the fact that there is still quarters of uncertainty and volatility in the marketplace. Of course, we will do our best to do as usual as much as possible. And we will be able to provide a more precise guidance in the quarters to come. So the next rendezvous, the next time we'll talk about it will be in April when we'll close the Q1 results. And then usually by midyear, by July we are able to give you a pretty good guidance and hence, what we did last year. If you remember, last year in July, we provided -- we upgraded the guidance from EUR 650 million to EUR 675 million and we ended up very close to -- actually at EUR 678 million. So hopefully, things will normalize and stabilize a little bit going forward, and we should be able to give you more precise figures in the coming months.So this being said, I think I would like to thank you all for your participation to this call this morning, and I look forward to talking to you again in the next future. Thank you very much. Have a good day.
Thank you. Bye-bye.