Good afternoon, ladies and gentlemen, and welcome to our Q4 earnings conference call. My name is Tim Lange, Head of Investor Relations.

And with me are today: Klaus Engel, CEO; and Ute Wolf, CFO of Evonik. The agenda for today's call is, as usual, we'll start with a short presentation on the highlights of our full year and fourth quarter reporting, as well as the outlook for 2014, and then we will open the floor for the Q&A session.

With this, I would like to hand over to Klaus Engel.

Thank you, Tim. Ladies and gentlemen, a very warm welcome from my side as well, and thank you, all, for joining today's conference call.

Today, we have a quite busy agenda with the full year and Q4 results. So let's jump right into our presentation.

Behind us lies an eventful year for Evonik. Hence, I would like to start with a quick recap of the highlights of 2013.

Also I would like to give you a brief update on our strategic progress. In other words, the progress we have made with our investments and our efficiency programs as well.

Following that, Ute will guide you through our Q4 financials before I will conclude the presentation with our outlook for the year ahead. And of course, we will then be happy to take your questions.

2013 was a year of achievement for Evonik. Firstly, Evonik was listed on the stock exchanges in Frankfurt and Luxembourg in April of last year.

Only a few months later, our stock was included in important indices, like the German MDAX and European stocks. It is probably fair to say that our debut on the capital markets was a bit bumpy.

However, we are gaining ground, and we'll continue to move forward in that respect. We will deliver on what we promised and strengthen our track record in the upcoming quarters.

The second big achievement in 2013 was the completion of our repositioning of Evonik as a pure-play specialty chemicals company. Thanks to the successful divestment of the vast majority of our real estate activities in July, we did not only accomplish this major strategic reorganization, we also freed up the necessary funds to finance the growth of our core specialty chemicals business going forward.

Admittedly, the new group structure is not yet fully reflected in our administrative functions. That's why we have launched Administration Excellence last September.

This program is designed to create leaner admin structures and improve efficiency across the whole group.

Our investment program is progressing well. Towards the end of last year, several of our new plants reached mechanical completion and are currently being ramped up.

They include our oleochemicals plant in Shanghai, our superabsorbent plant in Saudi Arabia in Al Jubail and our hydrogen peroxide plant in Jilin in the north of China.

Operationally, the stabilization trend and strong volume growth that we saw in Q3 continued into Q4 and enabled us to deliver on our guidance. With an adjusted EBITDA of more than EUR 2 billion, we successfully crossed the finish line.

Let me now go through the most important financial figures for the full year. Ute will later provide you with more color regarding the fourth quarter.

Overall, sales came in 4% below the prior year at EUR 12.9 billion. Volumes increased by 4% on a full year basis.

This development was especially pronounced in the second half of 2013. Globally, customers rely on our high-quality products.

Demand for our products was therefore strong. And we expect this positive trend to continue into 2014.

Prices were, on average, 5% lower than previous year. As you are already aware, this was mainly due to the price declines in amino acids and parts of our C4 chain.

The majority of our products, for example, superabsorbent, silica or coatings, as well as oil additives proved its resilience in a pretty challenging macroeconomic environment and showed stable or even improved performance.

We achieved our outlook with an adjusted EBITDA of more than EUR 2 billion. This represents a 19% decline compared with the prior year, which was caused by the aforementioned lower prices for key products against exceptionally high comparables from 2012.

Following the divestment of our former real estate activities, we established a solid net cash position of about EUR 550 million. The strong financial position is a solid basis to deliver on our growth path in the years to come, both organically and also via acquisitions.

In 2013, we already made good progress with our investment program. CapEx was 18% higher than in the previous year.

At the same time, we are also committed to delivering attractive returns for our shareholders. For fiscal year 2013, we are proposing a dividend of EUR 1.

That implies an increase in both the absolute dividend, as well as in payout ratio following the successful divestment of our real estate activities.

Our dividend policy remains basically unchanged. We intend to pay out 40% of adjusted net income and we also intend to keep the dividend at least stable.

For 2014, we expect slightly higher sales and an adjusted EBITDA between EUR 1.8 billion and EUR 2.1 billion. I will provide further details on our assumptions for this outlook at the end of our presentation.

Having successfully transformed the company into a pure-play specialty chemicals player, we can now fully concentrate on our strategy of growth and efficiency in the years to come. Let's start with the growth part of this strategy.

On February 28, we closed the acquisition of Silbond, a producer of highly specialized organosilanes. This acquisition with a purchase price in the mid-double-digit million euro range perfectly complements our existing silanes activities of our Inorganic Material business unit.

And on the one hand, it enhances our product portfolio mix and shifts it towards higher-end specialty applications. On the other hand, the U.S.-based Silbond is also from a regional perspective a great addition to our currently more European-oriented silanes operations.

Our global market leadership in functional silanes is now further strengthened. The main applications of Silbond's products are in high-growth niches in the electronics and the coatings industries.

I already briefly touched on the good progress we have made with our EUR 6 billion investment program. By the end of 2013, we had spent about EUR 2.1 billion, of which about EUR 1.3 billion went into strategic growth projects.

All our investments go into areas in which we enjoy market-leading positions, high barriers to entry and above-average growth rates. Of course, we continue with our disciplined approach to implement the investment programs.

Projects that have not started are always reviewed for changes in the current market situation and rescheduled if necessary. We carefully analyze when the time is right to introduce new capacity to avoid unnecessary adverse market effects as much as we can.

We demonstrated this flexibility in 2013. We revised our original CapEx budget downwards during the year from EUR 1.5 billion to EUR 1.2 billion and eventually even came out a little bit below that level for the time being.

For 2014, we target a maximum CapEx of EUR 1.4 billion, again with flexibility whenever needed.

The second pillar of our strategy is about efficiency. There is first progress to report about Admin Excellence.

As you know, we only announced this initiative last September. We have now completed the initial data collection and the process analysis.

Our project group has gathered more than 450 ideas to leverage efficiency gains. These are now being evaluated in more than 80 project teams.

Our assessment showed that we have the potential to reduce our admin headcount by around 1,000 employees naturally in a socially responsible manner. And after Phase 1, we can confirm our savings target of up to EUR 250 million.

We will now start working on these levers in detail and first measures will probably be implemented towards the end of 2014. This means that a small part of the overall efficiency gains can be expected already this year.

However, we aim to realize the bulk of the savings in 2015 and to achieve the full impact of the up to EUR 250 million in efficiency gains by the end of 2016.

With that, I would like to hand over to Ute for details on the fourth quarter.

Thank you, Klaus. Also from my side, a very warm welcome.

As usual, in the final quarter of the year, we saw a seasonal slowdown in our business activities. Nevertheless, the good volume development from Q3 continued into Q4.

Volumes were up 8%, more than offsetting negative pricing and resulting in organic sales growth. Due to some headwinds from currencies and portfolio effects, overall sales declined by 1%.

Adjusted EBITDA was lower than in the previous year and came in at EUR 386 million. However, the decline was not as strong as in the previous quarters.

For yet another quarter, we had to compare our performance against a tough pricing base for amino acids and C4 products. And even though we have recently seen prices stabilizing or even improving in these areas, this effect will persist at least for the next quarter to come.

In Q1, those prices will still be significantly below the levels seen in the first quarter of last year.

Chart 9 offers you a more detailed look on the strong volume development over the past 2 years. Volume growth continuously accelerated over this period, highlighting the strong demand for our specialty products.

For the last 5 quarters in a row, volumes have improved year-on-year. As already mentioned, Q4 saw an impressive volume growth of 8%, driven by many businesses across the whole portfolio.

Personal Care, Baby Care, feed amino acids, silicas, products for the coating industries and MMA were able to expand output notably.

Let me now quickly summarize the performance of our 3 specialty chemical segments, starting with Consumer, Health & Nutrition. This segment bundles our least seasonal businesses, which is visible in almost constant earnings compared to Q3.

So we see a clear stabilization here after the earnings dropped earlier in 2013. Consumer Specialties saw continued good demand, resulting in higher sales and earnings across all businesses in Q4.

2013 marks the fifth consecutive year of increasing earnings for Consumer Specialties. Obviously, last year helped by a strong performance in superabsorbents.

Methionine benefited from strong demand ahead of time of new year and still partly delayed new capacities in the market. While this also resulted in a clear stabilization of prices in China, on average, global prices were still lower in Q4 compared to both prior year and also prior quarter.

A year-on-year price decline will also be clearly visible in the first quarter of 2014 compared with the still high price levels in early 2013. Additionally, demand is likely to slow slightly after the Chinese New Year.

In lysine, Q4 brought the anticipated relief on the raw material cost front, thanks to the new corn harvest in the U.S. However, competition is still quite intense and has driven prices down further.

We do not expect the situation to change significantly in the short term.

Resource Efficiency recorded a strong fourth quarter with a year-on-year increase in adjusted EBITDA of 20%. Inorganic Materials delivered another good quarter with silica benefiting from improved demand from the tire industry in nearly all regions.

But the main driver of this result was Coatings & Additives. As in the past, the business performed seasonally weaker going into winter, but the slowdown was not as pronounced as usual.

Demand developed positively in the automotive, coatings and construction industries.

In oil additives, we continue to see support from the Resource Efficiency megatrend. Despite low growth in the overall lubricants market, we were again able to outperform the market with our solutions for increased fuel efficiency, durability and productivity.

Going into Q1, we expect to see the typical seasonal upturn, leading to normalized sales and earnings levels as seen in the first 3 quarters in 2013. On a full year basis, the segment margin increased again.

In the past 2 years, it has risen by 2.4 percentage points to now 21.3%. So the segment continues its rock-solid performance.

Sales in Specialty Materials came in below last year's level. Negative pricing effects more than offset the positive volume development, which was mostly driven by the continued increase in polyamide 12 sales, following the accident in the CDT plant in 2012.

Negative pricing was also the reason for the significant drop in earnings. For MMA, we recorded a good quarter.

The business benefited from the same trends as our Coatings & Additives activities. Demand from the coatings and construction industries did not slow as much as in the previous year.

PA12 saw an improvement in the underlying business in oil and gas as well as photovoltaic and automotive applications. Here, the low butadiene price levels continued to be beneficial.

Nevertheless, earnings declined year-on-year because in prior year's Q4, we were still receiving insurance payments in connection with the accident in our CDT plant. This base effect will also continue throughout most parts of 2014.

Turning to Advanced Intermediates. We saw the steady price increase in butadiene continuing.

Most of the strength was attributable to tightening supply, partly driven by the shift to lighter feedstocks in the U.S. While we expected this upward price movement to persist, the average butadiene price in Q4 was still significantly below prior year.

Additionally, the other products in the C4 chain faced weaker demand and prices in the last quarter. This was caused partly by onetime effects, for example, a temporary shutdown of a customer's plant and limited raw material availability for butene-1.

Other effects were seasonal. For instance, lower demand and prices for MTBE as less MTBE is blended into winter fuels.

We anticipate the negative price effects to ease as the year progresses. However, Q1 2014 in Specialty Materials should remain clearly below the average quarterly levels seen in 2013.

Turning now to the net cash position. Following the divestment of our real estate activities, we established a solid net cash position after Q3.

Throughout Q4, we were able to maintain this comfortable financial position almost unchanged despite an increased outflows of funds, CapEx projects and a EUR 200 million cash transfer to our CTA. A positive effect came from the earlier-than-expected repayment of a shareholder loan that we had granted to our former real estate business.

The repayment of the Degussa bond with a coupon of over 5% in Q4 obviously did not affect the overall position. However, it will have a significantly positive effect of about EUR 40 million on our financing costs from 2014 onwards.

Together with the effect from the recent CTA funding, we expect our financial results to improve by around EUR 50 million in this year. Given the outflows for CapEx program of up to EUR 1.4 billion in 2014, the dividend and further CTA funding, we anticipate that our net asset position as of year-end 2013 will be temporary.

It will turn into a moderate net financial debt position again towards the end of 2014.

With this, I would like to hand back to Klaus for the outlook.

Thank you very much, Ute. Let me finish our presentation with the outlook statement.

We expect, all in all, global growth to pick up slightly in 2014, driven mainly by the industrialized countries. Nevertheless, there is still considerable uncertainty, especially regarding the emerging markets.

As already mentioned throughout the presentation, the positive volume trend registered in the second half of last year should continue in 2014, leading to a further rise in volumes. Support for this development should come from the completion of our first growth investments.

We expect selling prices to remain at least stable in large areas of our product portfolio. For some key products, though, such as amino acids and C4 products, they will probably be below the average of 2013, simply because of the base effect of still high price levels in the first 6 months of last year.

We have also mentioned already that we expect to see the first positive effects of our new Administration Excellence initiative in the second half of 2014. Downside factors could result from ramp-up expenses for growth investments and negative currency effects.

Having said all of this, we guide for sales to rise slightly compared to 2013, and we expect adjusted EBITDA to come in between EUR 1.8 billion and EUR 2.1 billion.

When comparing the earnings development over the course of 2014, the price-induced high earnings level at the start of last year should be borne in mind. This was also reflected in the still strong earnings level of the first quarter of last year.

And some of the mentioned positive earnings contributions from 2014, for example, from our growth investments and from Admin Excellence, should materialize more in the second half of this year.

This concludes our presentation, and I hand back to Tim for the Q&A session.

Yes. Thank you very much.

So this opens our Q&A session.

And I think the first question comes from Thomas Gilbert, UBS.

Three questions. The first one is on one of the back-up slides, you mentioned on the investments that you've reached sort of milestones in terms of mechanical completion for several projects back in 2013.

Can I ask you, for example, with regard to Al Jubail as an example? You are mechanically complete but are your suppliers and the infrastructure around it as well?

So you're doing the job of delivering time-wise what you can deliver. But are the projects also on track when you look at the big-picture infrastructure around them?

That's the first question. The second question is can you just reconcile the fact that you have an Admin Excellence program but still guide for corporate cost or EBITDA to be 10% more negative in 2014?

I mean, I'm sure that some of these savings are in the divisions, but still I'm surprised that you're spending more in corporate costs in '14 compared to '13, if you can reconcile that. And then finally, to the third segment, you had 11% volume growth in the fourth quarter.

Can you shed a bit of color how that volume growth, that 11%, sort of was for PA12, for MMA, PMMA, and then for the C4 chain, just to understand where the double-digit volume growth really is sitting?

Yes. Thomas, this is Klaus.

I will take the easy one, the first question, and Ute will cover the admin versus corporate costs and the explanation of the volume growth. Yes, I can confirm that product is coming out of our production site in Al Jubail.

So we are not only ready mechanically, but we also deliver already to our customers the product. There is a quite strict certification process.

So depending on the individual customers, the products have to be certified. This process is going on, but we are fully operational and fully ready to deliver the market from the new superabsorbent plant in Saudi Arabia.

Okay. Regarding the corporate costs, we just try to give you some guidance here.

We have around EUR 10 million of not reoccurring releases that we had in 2013. We had lower provision for variable remunerations as the earnings development was not as desired so that might not reoccur, also holiday accruals, and that's -- so overall, we also had some increases in our wages, so I think that it's just -- we attempt to give you some guidance here.

On the volume development in Specialty Materials, I think it is a mix of our several products. Of course, high Performance Polymers fuels into that somewhat more as we restarted our activities after the accident.

But we have seen also good volume development in the C4 chain but also in MMA, so it's across several products.

Can I just come back to the first question? Outside Al Jubail, so the projects, hydrogen peroxide, China, Argentina, oleochemicals, Shanghai is all -- also in terms of your suppliers is all on track.

You will be able to supply timely as you thought you would?

Yes. Maybe an update in particular on the hydrogen peroxide plant, which is a major strategic investment.

Our hydrogen peroxide plant was, as a matter of fact, mechanically completed at the end of 2013. And the startup of the propylene oxide plant by our customer is, of course, a little bit more influenced by the strong weather conditions in the north of China.

As the winter in this region can be very harsh, this has impacted obviously the ramp-up date at that part. And the start of production during the cold winter season is technically just not reasonable.

The startup of this part is now expected for the end of Q1. And this will then lead to some ramp-up costs before the plant will contribute first earnings.

On the other hand, we have seen in those days a very strong demand for propylene oxide. So from the market side, there is a good prospect coming from this investment.

Next question comes from Norbert Barth from Baader Bank.

Yes. Norbert Barth from Baader Bank.

Also 3 questions from my side. First, overall, your outlook guidance and given that range, what I was a little bit surprised of EUR 1.8 billion to EUR 2.1 billion.

I wanted to understand a little bit the thinking behind, especially if you mentioned that there would be also some additional ramp-up expenses. Perhaps, you can quantify that a little bit.

And also you mentioned the negative currency impact. But at least comparable to other chemical companies, your currency impact looked to be minor.

So therefore, I was a little bit surprised to see especially this named. Perhaps, you can elaborate a little bit.

Have you also hedged even translation effects? So is that an issue perhaps, which still was positive in 2013, and we have to expect more in 2014?

And the second question regarding the dividend outlook. You mentioned especially for 2014 also that there is a positive cash flow inflow from the real estate deal.

So can we expect the one-off positive impact on dividend? Or what one should expect on that?

And the third question regarding the lysine business, I remember quarters before where you expected and said in the second half of 2013 or at least at year end that we should see some improvement. But I think this should have changed if I see your statement.

Can you elaborate really what is going on there in North America, especially on the lysine business?

A couple of questions, Norbert. Thank you for that.

I will start with some general comments on the macroeconomic assumptions on the outlook and why we have opted for the outlook range. Currency effects and ramp-up expenses, dividend outlook is something that probably Ute can cover best.

Basically, overall, we expect global GDP growth to slightly pick up from 2.5% last year to 3.3% in 2014. So we won't [ph] look here slightly optimistically into this year.

Factors that have had a clearly adverse impact in the last 2 years, such as the sovereign debt crisis in Europe and also the political uncertainty in the U.S., have become less significant by now. So that means that these regions should play a part in the global economic recovery, let's say, for the first time in a number of years.

The economic trend in Asia-Pacific and Central and South America stabilized at the end of last year and actually improved also slightly. So in view of this, we are modestly optimistic about the growth trends in these regions.

Nevertheless, the projection for 2014 is still marked by some uncertainty. The global economy could be held back if measures to stimulate growth are withdrawn too quickly.

In particular, if the expansionary monetary policy is throttled too fast, growth in North America could be by far lower. And this could also result in a slower-than-anticipated growth in the emerging markets.

For our important end customer industries, we anticipate, on average, volume growth to outpace GDP growth slightly. Considerable price pressure was observed in some of our key markets in 2013.

And while this effect has certainly eased in the second half of last year, we do not expect this trend to fully reverse in all of our end markets. As you said, Norbert, we are intentionally guiding for a range here.

It is too early in the year to predict precisely the macroeconomic environment as I have tried to point out and the key development in important end markets. And as a consequence, we really would not feel too comfortable to guide more precisely, neither on the lower nor on the upper end.

Otherwise, we would have provided just for a simple number. So we do not perceive our outlook as optimistic, cautious or conservative.

It is our most realistic guidance for the time being. Regarding the ramp-up expenses?

Yes. Then maybe I continue with the outlook-related questions.

On currencies, I think the FX effect on top line was not very big last year. And given there were no sharp changes in currency exchange rates, I think that is also a fair assumption.

For this year, we have some natural hedges in our business. We do not hedge translation effects.

We did not do that in the past and we do not do that at the moment. But I think in our business, we have a relatively small net position towards currencies.

I think there is one currency where we might see some translation effects, that's Japanese yen, and that has especially been affecting our Inorganic Materials business unit.

That's why I'm wondering that you especially mentioned a negative currency impact because you more or less stated also that this should be really from a minor issue.

Yes. I think it is one of the risks and as the year, emerging markets are really a little bit vulnerable.

I think it is fair to mention that risk as well.

Yes, let's put it this way. Obviously, in the past, we were able to manage this risk reasonably well.

But of course, we cannot avoid this 100%. So we will try as much as we can to keep it -- to keep our exposure there due to the way how we deal with those currency effects like in the past.

But of course, there is not 100% certainty about this.

And towards the ramp-up costs, as you know, we have our methionine plant going into operation this year. This is a very big investment for us.

Ramp-up costs make up, up to 5% to 10% of the investment volume. Of course, in such a big work scale facility, I think there are meaningful and substantial start-up costs to be expected.

I still have dividend outlook and lysine on my agenda. Dividend outlook, as we said this year, EUR 1.

That leads to a dividend payback of 3.5% this year. And regarding the future, I can only confirm what we said before.

We plan to pay a dividend, 40% of adjusted net earnings and also, of course, at least a stable dividend. So this I can confirm.

In terms of lysine earnings, on the one hand, yes, we saw a relief on raw material costs from a new harvest in the U.S. We had there, as you have noticed, until Q3, extraordinarily high raw material costs after the drought in the U.S.

in 2012. On the other hand, of course, price is enough, the NPU continued to be quite under pressure across the board.

And this comes as a result of lower animal production due to the high input costs, animal diseases and reduced meat consumption, also due to food safety issues in China. Also CJ was promoting their new capacities in Iowa, so there was quite some aggressive premarketing activity going around, while at the same time, imports from China stayed at increased levels.

So all in all, it's fair to say that due to the above-mentioned reasons, the margins are expected to remain under pressure during the upcoming month. We believe slight relief might come some Chinese competitor, who announced already reduction of capacity utilization very recently.

I hope this answered your questions.

Next question comes from Paul Walsh from Morgan Stanley. [Operator Instructions]

Yes, no problem at all, Tim. I'll keep it to 2 if that's okay.

My first question was really about the longer-term targets. Given the guidance that's been put in situ for 2014, I'm just sort of thinking that to get to 13 -- sorry, get to EUR 18 billion of sales and EUR 3 billion of EBITDA by 2018 is more or less going to require you to grow the top line at 9% and EBITDA at 11% plus.

So just any thoughts on the extent to which you can bridge some of these near-term issues that might be holding you back longer term would be interesting to hear. And my second question was around, I guess, competitive threats.

You talked about the capacity expansion within the methionine business. We've seen a number of other players expanding in that market, too.

How much within the guidance factors in a potential scenario where methionine prices come under pressure again just sentimentally because of the wave of capacity that is at least scheduled to come through. Whether or not we see it at all is another question, but those are my 2 questions.

All right. Thank you for your questions.

Regarding your first question, the mid-term targets, I can confirm that the Evonik growth story, in our view, is intact and the mid-term targets remain certainly unchanged. So the vast majority of businesses are -- have underlying structural growth drivers, which we have explained.

And we see a positive volume development as an indicator for the healthy demand and for market growth that is also able to absorb new capacities coming onstream, of course, over the time. Earnings contribution from the investment program will substantially increase over the upcoming years when the new plants are in the normal operation mode and ramp-up costs subside.

So we are just taking off, to say so, Admin Excellence also here with significant savings in 2015 and 2016 with a higher retention rate. So growth will not come linear but probably more back end-loaded in this respect.

You touched in your second question on the competitive threats, in particular in the methionine market. I can say, of course, we have prepared ourselves very carefully, in light of the big investment in Singapore, all of the changes in the market so far.

So the competitors that have come onstream or try to come onstream, I should say more precisely, were factored into our marketing plan. We now see that a little bit the timing of the new capacities, which is more on the hand of our competitors, is not exactly what is always announced.

So it depends a little bit also how all this new capacity will come on to stream just in 1 year or over the time. From our intelligence, we see more delays and more capacity coming into the market over a longer period of time.

Nevertheless, the volumes are transparent. We have, in our investment, also factored in a moderate price decrease.

And what we have, of course, in our own hands is to play our market leadership that we have globally, not just from the Singapore plant but also from the European and the U.S. plant.

I think that is, by far, the best global footprint that we have in the business together with a global direct sales force. So we use distributors here to a very limited extent.

We can very closely watch the market development, which is obviously very important in such a volatile period of the market. And again I think we also made the point that our plant in Singapore will, by far, be the most cost-effective plant that will come onstream over the time.

Klaus, just on that. Have you given a quantification as to how much more cost-competitive it is?

Yes, I ask for your understanding that probably we will not give details here on a single-site scope. But just to give you a little bit the flavor, Paul, we are now in this business since more than 30 years.

And some of the guys come now in with new technology or, let's say, with established technology, but they are new in the market. And compared when we started this business 30 years ago with the technology, which we have developed over the time, and compared to our efficiency right now, there was a productivity gain of 25%.

So it gives you a little bit the flavor of the experience curve, which is there. And I really would wonder if our competitors, which are also just volume-wise, if you compare, our 150,000 tons that we will establish compared to other capacities, I think it's pretty obvious that this cannot be economy of scale.

Next question then would come from Martin Roediger from Kepler Cheuvreux.

Two questions, basically are primarily focused on methionine. The first is on the pricing.

Today's price is 10% below the average of last year. So clearly, year-over-year prices will be down.

But I'm more interested in sequentially. And you just mentioned in the last question that you have in your planning horizon a slight decrease in pricing in methionine.

Is this also valid for 2014? The question I ask because is that Adisseo recently has announced a 7% price increase, and I would like to understand how you think this price increase by your competitor will stick in the market.

Second question again on methionine is you already mentioned that capacity you expect to come not on time from your competitors. Is that related with Unisplendour?

Or do you think -- or is it more related to the joint venture from Arkema and CJ? And maybe you can give us, let's say, an update here when do you think these capacities come onstream, if at all.

Yes, okay. I think it was reported publicly that one competitor had to stop the production at its local plant due to environmental reasons.

I think that underpins what Klaus really said how important it is to have long-dated experience in that business. I think another report that was publicly available was on the startup and first volumes of liquids methionine from Adisseo's new plant in China that will come now in Q1.

I think in China, we had seen some price increases also in relation with the Chinese New Year. Does that answer your question or...

No, I just want to make sure. I mean, you are basically not only active in China, also European market.

So I would like to get a feeling about, for example, when I look into your outlook for the EBITDA in 2014, does that mean that this includes the slight decrease in prices also on a sequential basis compared to today? Or is it just, let's say, because of the high comparison base that you factor in a slight decrease in prices of methionine for 2014?

I think the outlook factors in several risks, potential risks. So I think it is not very feasible to pick out one.

I think Klaus really explained what we -- what kind of difficulties we might face in the overall economic situation. So I think with this range, we give an outlook which factors in potential risks.

And I think it doesn't make sense to discuss one potential outcome because there are other ones that would have to be considered as well.

Martin, if I may add. It's Klaus again.

And probably we should not mix up 2 things here. My comment regarding we have factored in a slight price decrease, that refers to a situation where we're coming at from extraordinary price levels, let's say, in 2010 and 2011, when we had a very narrow demand and supply balance.

But at that time, we started, of course, to make up our considerations regarding a business case for the new investment. And of course, already at this point in time, it was known how the new demand and supply would evolve.

And we have taken a cautious approach on the economics of this investment. So that refers to the top prices in 2010 and 2011.

In this year, I think for methionine applies the same that as the vast majority of our portfolio has seen recently a stabilization of prices. And what we have noticed, this is in line also with our expectation that in the next month, prices at least should be stable or slightly increase.

Next question comes from Lutz Grueten from Commerzbank.

Yes. One follow-up on Specialty Materials.

I'm trying to get a better grip on the underlying performance of that business. And there seems to be a one-off effect, a positive one, in the final quarter 2012 from the insurance payment and a negative one-off effect in the final quarter last year regarding the Marl shutdown.

Could you quantify these 2 effects, please, just to get a better grip on the underlying performance? And the second question is regarding today announced job cuts.

You talked about 1,000 jobs. Could you give us any idea on the P&L effects on cash flow, the timing?

And will these effects be -- these cash-outs be adjusted in the EBITDA line?

Yes, I think the maintenance shutdown in Marl was in Q2 and Q3 last year. And I think we gave some indications on the impact on the P&L.

It was in Q2, around EUR 30 million, and in Q3, a lower single-digit million amount.

So there was nothing in Q4?

No. When it comes to the insurance payment, I think we wanted to hint that this, of course, goes directly to the EBIT and the EBITDA line, not so much [indiscernible] sales.

I think that was the hint we wanted to give there. Regarding the restructuring, I think we did all provisions in Q3 last year.

We indicated also the amount. The cash outflow I think will come proportionally over time, most probably I think next year, maybe a little bit this year as well, next year and some of that in '16.

And the insurance payment on the EBITDA, nothing on sales. Could you quantify this effect, please?

No, because then we would comment on earnings on single-product level, which we do not do.

Next question will come from Andrew Benson from Citi.

On the C4 businesses, you -- obviously, we can see what the butadiene price is. But you talked about the non-butadiene C4 business as being more challenging.

And I wondered if you could give us some more details on that. And perhaps, I just haven't really understood correctly on the restructuring guidance.

I think I can see that the administrative side don't expect much this year. But what about the other 2.0 restructuring, how much benefit should accrue in 2014?

Yes, Andrew. Thanks for your question.

It's Klaus again. I will try to give a little bit more color on the C4 business and Ute then will cover the restructuring costs.

Let's start with Q4. Q4 proved to be an overall difficult quarter for our C4 products in particular.

The volumes at this time across the whole C4 chain were weaker, and there were a couple of reasons specifically to that, seasonal effects. If you think, for instance, about MTBE, where winter specification of gasoline allows the blending of cheaper butane instead of MTBE.

This is a seasonal effect or in DINPa as the global production volumes for plastics are generally a little bit lower towards the year end. We had, on top of this, partly weaker market demand, for instance, in 1-butene, which was affected by an overall cautious European polyethylene market.

And we have also seen raw material limitations that have negatively affected production volumes across the whole C4 chain. Other than that, a maintenance shutdown of a major customer in 1-butene in the U.S.

And we have also seen new capacities from competitors here, especially several capacity startups for INA production in Asia. So the lower volumes across the C4 chain have impacted the prices.

However, we can also confirm that we have seen a continued recovery, in particular, in butadiene price since the mid of 2013. Slow steps but steps into the right direction.

Prices year-on-year are, of course, still significantly lower. Overall, prices for C4 products, on average, in Q4, below prior year.

Yes, regarding On Track, we already have measures for overall potential of EUR 280 million in execution. The savings effect for last year was around half of it, so nearly EUR 140 million.

When you want to see how this affects the P&L, please keep in mind that On Track also targets variable costs, so it's not a fixed cost-reduction program in the pure sense. It's about 50% where really variable costs are affected.

And the other 50%, so roughly EUR 60 million, EUR 65 million, are a pure cost reduction in our more or less fixed cost base.

All right. So if you could just put a fairly simple number on what sort of level of restructuring gain we should expect in 2014 relative to 2013, what sort of number?

Is it EUR 120 million, EUR 150 million?

The On Track program is a relatively steady, designed program. So I think it's more or less the same steps year-on-year.

But please keep in mind it's also targeting variable costs. It's not a pure fixed cost effect that we have here.

Next questions come from Oliver Reiff from Deutsche Bank.

Two questions for me. The first one is on early Q1 trends.

Can you just talk about what you're seeing across the business? And one specifically on methionine, are you seeing any impact in China from bird flu?

And my second question is on if you hold pricing at current levels and everything else equal, mix and volumes and also excluding any exceptional shutdown costs that you saw last year, what would the net impact be on EBITDA in 2014?

Oliver, all right, I'm not too sure whether I got your second question right. Ute, start thinking about it.

I start with the early Q1 trends, in particular, methionine. All right, so start into the new year.

As I said earlier on, positive volume development that started from the second half of last year. This, we have seen also dragging into the new year, and we expect to continue this into the Q1 of this year.

Several businesses with continued solid performance and also similar start into the year as in Q1 last year that refers, in particular, to Consumer Specialties, Inorganic Materials and Coatings & Additives, very stable, resilient business. We have seen -- we are somehow subject to weather conditions, especially in a couple of outdoor applications.

We have seen 2 side of the coin here, mild winter in Europe that will continue obviously to be beneficial for the European coatings and construction industry, but the other side of the coin partly compensated by the very harsh winter in the U.S. Also here, we have seen some production delays, reduced volumes, logistic challenges and frost dump damages, not so much on our sites but also on the site of main customers.

Good demand from automotive industry continues. This is positive, in particular, for silica, coatings, oil additives or also high Performance Polymers, like polyamide 12.

We have experienced a price stabilization trend also in some key products during the last month, namely methionine and butadiene. I think I mentioned this already.

But again just statistically here, bear in mind, we had very tough comparables in Q1 with still high prices in these key products. So this base effect will ease out certainly over the course of this year.

So to give you a little bit here more color, for instance, on the butadiene price in Q1, we started around EUR 960 this year. This compares to close to EUR 1,400 last year per ton on average in Q1 last year.

Methionine and also lysine prices, obviously below prior year. In advanced materials, all in all, Q4 price weakness in C4 chain partly to persist into Q1, but we see here also a gradual recovery throughout this year.

Prices will notably be lower in the first quarter compared to prior year. I think we have emphasized this already.

Amino acids here, in particular, a very seasonal effect. There is to expect a slight drop in volume, which we'll recover later on.

This is due to the Chinese New Year effect that depends always when the Chinese New Year occurs. So we have seen this last year in Q4 already.

That is something that we now have in Q1 this year. So summarizing all in all, it will not come hopefully as a surprise that the Q1 earning will come in notably lower than last year.

Yes. Maybe your question regarding our overall outlook.

I think there are, in some important products, this effect that the actual price level is below the average price for the whole year so that if you look year-on-year, that, of course, is a factor to what influence to take onboard. On the other side, we expressed we have a cautiously optimistic outlook on the overall economy.

But of course, in the last years, we have seen that can change over the year and can also turn to the other direction. So that's what we all factored in when we designed the outlook.

That's why we chose the range to really take onboard potential risks and to give you a realistic picture of what could happen this year.

Next question will come from Jaideep from Berenberg.

I'll keep it brief. First question is on your CapEx plan.

Can you give us a little bit more color on the planned budget you have for 50%? I'm just curious considering you've announced sizable projects in significant proportion of your portfolio.

So in this 50% planned CapEx, I mean, like what are the business units where you need capacity, which you are considering right now? I appreciate if you can't give a lot of detail on it, but some color would be helpful, given it's such a big number, which is sitting unknown.

And just if you were to not do some of these CapEx projects, would that have a material impact on your EUR 3 billion guidance? That's the first question.

And the second question is just on to understand a little bit the major projects you have with regards to, let's say, methionine. When you are increasing capacity now, how do you plan to manage it?

I mean, will you have to sacrifice utilization in Europe or the U.S. significantly to introduce capacity in Asia?

If you can give some color on that, that would be great.

All right. While Ute is working on the CapEx plan, I will try to answer the second question.

Look, I think we are in an advantaged position here. As I said earlier on, we operate, by far, the widest global network of world-scale methionine plants.

We are currently serving also the Asian market, very competitively already from Europe and in parts also from the U.S. Depending on the market conditions when they evolve over the next month, so let's assume that one or the other competitor will surely come to the market, what we will do is we will try to use the capacity of the Singaporean plant later on in the year as extensive as we can.

Why are we doing this? We are convinced that with 150,000 tons methionine, we are, by far, the most cost-efficient plant in the back of 30 years of experience.

So we will play this cost advantage. In any case -- in case that the market that will have a hard time to digest -- and we will not do this on day 1, so there is a time period of a month to bring this volume in the market fundamentally.

In case the market has to wrestle with the absorption of the volumes, we have always the opportunity to reallocate the supply of customers from the other plants in favor of the Singaporean plant. So I think it's obvious that we use this cost advantage, and we think our position can only increase.

Right now, the strongest growth is in the Asian market, but also with Singapore get an advantage and an additional savings in logistics cost. And please also bear in mind that already today, we can serve this market very competitively from Europe and from the U.S.

This is about the introduction of the new capacity, and I think, in the meantime, Ute is ready.

I think you refer to our Capital Markets Day statements, where we said where we're spending at this time. I think we allocate the CapEx to our most attractive growth businesses.

I think that is important to keep in mind. When we talk about flexibility, we are not talking about canceling projects.

We're just talking about postponing them by 6 to 12 months in order to really be better in time-to-market. And in the end, I think it doesn't help to do a project too early because then the earnings contribution doesn't come as well.

So from that point of view, I think even if we postpone one or the other project by a few months, that does not hurt the overall aspiration and the overall contribution we expect from our CapEx program.

Okay. Could you give some clarity about which are the business units which are very tight which you need CapEx?

Because, I mean, you've announced basically CapEx increase in almost every business unit. So just curious, where is this rest of EUR 2 billion going to be spent?

I think it's fairly spread over the business units and segments. I think what we've announced with oil additives expansion, which is relatively efficient as it is an expansion on existing site, so it's really -- silica, I think we have several smaller projects, also very efficient.

We have in Consumer Specialties in Shanghai, which is nearly completed, and also in Brazil. So I think there's really a variety of projects in several businesses.

I think what is important, that we really take a look at the growth prospects and allocate the CapEx accordingly.

Next question comes from Andreas Heine from Barclays.

I have 2 questions. The first is do you have any figure available of the price change in the group, excluding the amino acids and the C4 value chain?

And the second is also on an expansion program, as far as I know, you also plan to expand in the C4 value chain. Is that still valid?

Or is that one of the projects which is delayed?

Yes, Andreas, thank you for your question. The second answer is quite easy.

We are on the way to expand the C4 value chain in Marl and Antwerp, and this investment project is progressing nicely. We stick to that because we take here a long-term view.

We know that butadiene is a little bit under pressure right now. But still our mid-term aspiration of the business is as such that there will be market demand for the products, not only Butadiene but also higher value-added products coming from this investment.

So clear answer here, this project is not postponed. On the other question, I think it's a little bit -- I'm not too sure whether we can answer that.

I'm looking at Ute.

Yes, I think we give a price influenced by segment. And I think for the Specialty Materials, they have a lot of published prices.

So you have an idea what is the influence there, and maybe that gives you some color on the remaining segments Health & Nutrition, Consumer, Health, and Nutrition.

Andreas, I guess that answers your question. Then the next question will come from Martin Evans from JPMorgan.

Yes. Just following on from Paul's question about this mid-term target, and I appreciate it's a long way off 2018.

But obviously, if we take your guidance for this year as a base, you're going to need to find over EUR 1 billion in the space of 4 years EBITDA. I mean, is this purely aspirational from your perspective?

Or have you carefully calculated where you think that increase will come from? Because I get what you say on cost savings being back end-loaded from Admin Excellence and so on, but it does seem to be a very ambitious target.

Or are you factoring in again acquisitions to get you to that number?

Martin, first of all, a fair question. First of all, I think we have released already that we expect from the CapEx program -- so the famous give or take EUR 6 billion we are talking about, roughly an EBITDA of north of EUR 700 million.

So this has to come finally until 2018. So that gives you a flavor.

And I think it's fair to say if we spend this amount of money, you can also expect a return. And those EUR 700 million should come just from new strategic growth investments.

And on top of that, rightly so, you have indicated also on the cost side, which should give us also an improvement in profitability. So it's right, we are coming right now a little bit from a situation we have seen rather a slow pricing, the new capacities are not there yet.

But I think with our emphasis on organic growth so far, we have a reasonable route to these mid-term targets.

I guess this was the last question in the line. So as there does not seem to be any further questions, I would like to hand over to Klaus Engel once again for the final statement to end the call.

Yes, ladies and gentlemen, folks, that brings us to the end of today's call. We are looking forward to stay in close contact with you over the next few weeks.

Our IR team with Tim and the other guys is, of course, always available. Ute and myself will also be on the road in the next weeks, for example, in London and Frankfurt in -- from March 19 to the 21, or in Paris on April 2.

Thank you once again for your attention, and goodbye. Have a nice weekend.