Thank you very much. Good morning, everybody.

Welcome to Arkema's Q1 '26 results conference call. Joining me today are Marie-José Donsion, our CFO, and the Investor Relations team.

As always, to support this conference call, we have posted a set of slides which are available on our website. I will comment the highlights of the quarter before letting Marie-José go through the financials.

At the end of the presentation, we'll be available, as usual, to answer your questions. In the continuity of 2025, market conditions remained soft into January and Feb 2026 before improving in March.

Regional trends were contrasted, with demand continuing to be subdued in Europe and in the US, while Asia showed again solid momentum across several of our end markets. In addition, the quarter was once more affected by the depreciation of the US dollar compared to last year, while this impact is expected to be more limited from the second quarter onwards.

End of February saw the outbreak of the conflict in the Middle East, which started to impact global supply chains and quickly led to a sharp rise in certain raw materials as well as in energy and logistic costs beginning in Asia. In this complex environment, Arkema delivered stable volumes year-on-year, a solid performance in the context.

This was particularly driven by Specialty Materials, whose volumes increased by 1.5%, supported by a strong pickup in March. All Specialty Materials segments were up.

Coating Solutions benefited notably from better dynamics in UV-curing resins. Advanced Materials posted solid growth in key attractive markets for High Performance Polymers.

Adhesives were supported by durable goods and some limited improvement in construction. This volume performance also reflects Arkema's continued momentum in high-growth pockets, with volumes up 15% in attractive end markets such as batteries, sport, 3D printing, and healthcare.

Batteries, once again, deliver strong growth, supported by the rapid expansion of energy storage systems, a key additional driver for the group, particularly within High Performance Polymers. As a result, Q1 EBITDA came in slightly above expectations, reaching €283 million, up 14% versus the fourth quarter of 2025, supported by an improvement in March.

EBITDA was nevertheless down year-on-year, primarily impacted by a significant negative currency effect of around €20 million and the absence of rebound in the US and Europe so far. Besides, Advanced Materials experienced a slow start to the year, in line with the trend observed in Q4.

However, momentum improved in March, and Q2 should be up sequentially, supported by HPP. I would also like to underline the good performance of Coating Solutions, which improved its EBITDA margin by 100 basis points, supported by a more favorable product mix.

Adhesive Solutions delivered a significant sequential improvement, despite being down year-on-year. On the other hand, Primary Materials increased earnings slightly year-on-year, mainly driven by legacy refrigerants in the US.

In acrylics, the improving spreads in Asia came late in the quarter and so had only a limited impact, while the business in Europe and the US continued to be challenging, particularly in January and February. However, from today's perspective, it is fair to assume that the acrylics spreads should improve in Q2, with a magnitude still to be confirmed.

As you can expect, all teams are fully mobilized to effectively and swiftly manage the current economic and geopolitical challenges. In the first quarter, we have offset fixed cost inflation at constant currencies, and we are well on track to achieve this objective for the full year, supported by a number of cost-cutting initiatives.

Turning to the Middle East crisis, the group is reacting swiftly to mitigate supply chain disruptions both in terms of raw material availability and, more important, input cost inflation. Pricing adjustments have been initiated to offset the increase in raw materials, energy, and logistics costs, with actions deployed selectively by product market and geography.

This has required close and continuous coordination with both suppliers and customers. Price increases will become visible in Q2.

Arkema's well-balanced geographical footprint to serve customers predominantly from their region is worth mentioning as a good advantage in the current environment. Far, we have been able to navigate this crisis without any supply disruption.

Moreover, Arkema remained focused on executing its major growth projects. The group is currently finalizing the completion of its new PVDF capacity in the US scheduled to start mid-year.

This will add 15% additional capacity in the region to meet growing demand for locally manufactured PVDF, particularly for energy storage systems, semiconductors, or cable applications. In parallel, the group also announced a further 20% capacity expansion at its PVDF plant in China, set up to start in 2028.

Also, the new unit of Carling, downstream of our PA11 in Singapore, started up successfully at the beginning of the year and is expected to support HPP earnings momentum from Q2 onwards, driven by capacity ramp-up. I would also like to underline the strong first quarter performance of PIAM.

EBITDA was up more than 30% year-on-year in local currency with a 35% EBITDA margin. As highlighted during our last call, PIAM continues to benefit from good momentum, driven in particular by solutions for foldable and ultra-thin smartphones as well as its expansion into higher-end applications.

We expect this positive trend to continue into the second quarter, with robust year-on-year sales growth. In addition, Arkema stayed disciplined in its capital allocation.

We delivered a solid performance with regard to working capital management. This contributed to recurring cash flow coming in better than last year.

This performance also reflects lower CapEx, fully in line with our €600 million full-year CapEx target. I will now hand it over to Marie-José for a more in-depth look at the financials by segment before we discuss the outlook at the end of the presentation.

Thank you, Thierry, and good morning, everyone. Arkema's Q1 revenues, at €2.2 billion, were down 8.4% year-on-year.

They were impacted by a negative 5.1% currency effect, reflecting mainly the weakening of the US dollar against the euro compared to Q1 last year. Volumes came out broadly stable year-on-year, supported by a strong month of March after a relatively soft start of the year.

The price effect was a negative 3%, reflecting essentially the lower selling price environment compared to Q1 2025, in line with the progressive decrease in raw material costs observed in 2025. Q1 EBITDA came in at €283 million.

The currency effect represented a negative of around €20 million. Looking at the performance by segment, Adhesive Solutions achieved an EBITDA of €89 million.

It reflected, on top of the currency impact, the still weak demand in North America and Europe. Volumes grew slightly, let's say, overall, supported mainly by Asia.

This performance was driven mainly by adhesives for durable goods, with an improvement in aerospace and heavy truck markets in North America. On the other hand, packaging remained soft, and construction was better oriented, especially in Europe.

In Advanced Materials, the EBITDA stood at €139 million. Apart from the currency effect, the EBITDA was essentially affected by the unfavorable product and geographical mix.

Market conditions in much of the quarter were similar to what we observed in Q4 last year, which means a continuing weak demand in the US and in Europe, while Asia continued to show a positive dynamic. Coating Solutions delivered a good performance in the context, with an EBITDA stable compared to last year at €51 million.

Volumes were up 3%, driven mainly by strong growth in Asia, in particular in UV-curing resins. The EBITDA margin improved by 100 bps, at 13%, benefiting from our development in higher value-added applications.

Lastly, Primary Materials EBITDA was slightly up, at €33 million, especially supported by a good performance in legacy refrigerants in the US, while acrylic monomers stayed in low-cycle conditions in most of the quarter. Depreciation and amortization stood at €165 million, leading to a recurring EBIT of €118 million and a REBIT margin of 5.4%.

Non-recurring items amounted to €45 million. They include €34 million of PPA depreciation and €11 million of one-off charges, notably some restructuring and reorganization costs.

Financial expenses stood at -€29 million, the increase versus last year reflecting mainly the cost of carry of pre-financed green bond issued end of 2025. Consequently, the Q1 adjusted net income amounted to €65 million, which corresponds to €0.86 per share.

Moving on to cash flow and net debt, Q1 recurring cash flow amounted to -€95 million, which included the first quarter classical working capital seasonality. The working capital ratio on annualized sales stands at 16.3%, which is better than a year ago.

Total capital expenditure amounted to €75 million in the quarter, which is in line, again, with our guidance of annual CapEx spend of €600 million for the full year 2026. Net debt and hybrid bonds at the end of March '26 amounted to €3.3 billion.

The net debt to last twelve months EBITDA ratio stands at 2.8 times. Thank you for your attention, and I'll hand it over to Thierry for the outlook.

Thank you, Marie-José. As you could see, despite the geopolitical headwinds, we could deliver positive volume growth across our Specialty Materials segment in the first quarter, with a double-digit increase in our key attractive markets.

As we move into the second quarter, the conflict in Middle East, which began 2 months ago, remains ongoing, as with continued uncertainty regarding its direction and its duration, sorry, and the magnitude of its consequences on the global economy. At this stage, obviously, the key priority of the group is to remain agile in navigating this volatile environment and to adapt its pricing policy swiftly to offset input cost inflation.

This is what we are clearly doing. We remain attentive to other potential impacts of this context, notably on global demand, as everyone.

At the same time, this crisis could also create some upside, as it could also lead temporarily to tighter supply-demand balance in certain value chains. In parallel, the group continues to focus on self-help measures, maintaining tight cost and operational control, as you could see in the in the first quarter, alongside the disciplined execution and the ramp-up of its growth projects.

In this context, the group confirmed its target of a slight EBITDA growth at constant exchange rate for 2026. Before opening the Q&A session, maybe a quick word on Arkema's journey during the past 20 years.

We add a few slides in the deck on on this anniversary. As we became listed on May 18th, 2006, and we'll be celebrating the group's 20th anniversary in a few days.

Over this period, the company has undergone an in-depth and unique transformation from a mix-bag of commodity businesses—most of them were unprofitable at that time; they were European-centric for most of them—and we transformed the company into a global and profitable leader in Specialty Materials. Today, Arkema benefits also from a strong financial structure, solid performance, meets also high non-financial standards, and offers its customers superior set of cutting-edge technology.

While the chemical industry is currently in low cycle, which is reflected in the share price, leaving space for significant upside going forward, Arkema delivered strong long-term value creation over 20 years. €1 invested in Ark ema in May 2006 has become €3.6 today, including dividends.

Besides, Arkema share price increase over these 20 years is well above the evolution of the CAC 40 and its chemical peers, particularly in Europe. Thank you very much for your attention, and together with Marie-José, we are now ready to answer the questions you may have.

Hi, Thierry, Marie-José. Thank you very much for the presentation.

Two questions, if I may. The first quarter has been characterized by better volumes in the more specialty business and less so in the more upstream business, and yet your comment around tightening supply and demand chains would suggest that the reverse will now happen.

Is that what we should expect, and could you comment to how you see that playing out both for 2Q and the rest of the year, maybe regionally as well, given we're expecting quite diverse performances between, say, Asia and the US? Be very keen to hear your views on that.

A second question, related, but a follow-up, is, what do you think the medium-term, kind of structural or kind of more sustainable impacts will be, or that you're seeing in customer behaviors, from the conflict that's arisen in the Middle East? Thank you.

Thank you, Tom, for your question. Obviously, we are in an interesting world, where none of us know exactly what is going to happen.

Visibility remains limited. The good things, and this is certainly what you could read from the Q1 performance and from our comments and full-year, is that we remain solid, because we have both balanced portfolio from a geographical standpoint and also from a product line standpoint.

Sometimes diversity bring stability, and this is the case for Arkema. Back to your question, I think that the dynamics, I would say from a geographical standpoint, will stay with the same contrast over the Q2 and maybe the remaining part of the world, where the engine will be clearly more Asia than Europe and US.

We'll see. From a product line standpoint, it can depend from month to month.

What is clear is that, as we mentioned, acrylics, which is what we mentioned by upstream, will benefit in the Q2, at least from a better supply-demand balance. I think, last year we suffered clearly in acrylics; Q2 we will see light in the tunnel, which is good, which shows that our strategy is producing benefit and that the diversity of the portfolio is playing is part.

Now, as I mentioned a couple of months ago—I said this and it was at the early stage of the Middle East crisis—I said that I believe that this crisis will have a positive and negative impact, but all in all for Arkema, it should be around neutral. We are still in this kind of philosophy, and this is why we confirmed the guidance for the full year.

You mentioned upstream, but in coatings, for example, we see some good momentum, reverse of last years in the quarter Q1, and we should be confirmed in Q2 with regard to adhesive, a sort of overall resilient solidity, not wonderful, but overall resilience. In Advanced Materials, more contrast, I would say, because we believe that in HPP, after a sort of soft start as I mentioned, we should start to see a sort of sequential momentum, benefiting from all these key projects that we have mentioned and new investments, while on the opposite, Performance Additives should be maybe the loser of the Middle East crisis, because this is a business, the product line, which has the most customers in Middle East, and is certainly more impacted by some raw material increase like sulfur, where you have time lag to pass it to customers.

I would say the portfolio will play its part everywhere. At the end, the good thing with what we deliver is that there is no surprise in a world of plenty of unknowns, with some positives and negatives, but overall with sort of neutral stability, but plenty of work for the team clearly.

Now, the impact of the medium term from Middle East crisis, which is, I imagine your question is on the global demand, I would say nobody knows exactly. If it lasts a long time, certainly there should be impact because of the inflation and the disruptions.

Far, we don't see too much. The volume are correct.

I would say not worse than they were last year, at not extraordinary level, but I would say not too much impact so far. Wait and see.

We confirm, I think taking everything into account, we believe that for Arkema, this event in Middle East should be neutral with some positive element and some downside.

Just to follow up on that. Do you think we can expect 2Q '26 EBITDA to be above that of 2Q 2025?

I'm just trying to get some kind of reference point to understand how things might progress.

My feeling, and this factored in the full-year guidance. Last year we were more, if you remember, H2, Q4, we were more around -25% compared to last year.

Then we are -14% in Q1. You see that step by step, we catch up with last year, year-on-year.

I would say we ought to be comparable, I would say, Q2 '26 compared to last year, which would be a significant step up, and which is really our roadmap to deliver the full-year guidance. We would be really aligned with the full-year guidance by achieving that.

Very clear. Thank you, Thierry.

Thanks for sharing your thoughts.

Hey, good morning, everyone. I wanted to ask about the Advanced Materials division and from the starting point of the margin you currently have and the trajectory to get towards the midterm guide, and in particular, the point on mix.

I'm not sure I fully understand why mix is a headwind at the moment. Maybe there's some specific products, but you alluded to geographic mix, and I'm struggling to reconcile that with the idea that your CapEx has been disproportionately in Asia to satisfy where the demand is coming from.

Yet somehow mix is negative. I wouldn't have intuitively assumed that the Asian demand was going to be margin-dilutive, or else that wouldn't be consistent with the mid-term targets.

Can you just explain to me what's been going on with mix and how you see that evolving? Then somewhat related, you've announced an incremental investment in PVDF in China.

There's been a lot of debate in recent years about the degree of competition and commoditization. I see one of your peers in Japan recently took a large write-down on some investments they're making.

Why do you still believe that you can make a reasonably attractive return in that PVDF segment and it warrants putting more capital into it? Thank you.

Thank you, Matthew. A very interesting question, I think completely of different nature.

In fact, on overall, on the midterm, we're comfortable on the fact that the mix, both geographical and product, will improve. This is not the topic of the short term.

The topic of the short term is nearly mechanical, I would say. As the unit margin in Europe and the US are by nature, on many of our businesses, higher in Europe and US than they are in Asia.

It's true for many companies. The reason being that the cost structure itself is heavier in Europe and US than it is in Asia.

At the end, in terms of profitability, okay, we have quite good profitability in Asia, as we have in the US; we are lower in Europe. Which means that for the same volume, when these volume are more weighted, which is the case since 2 years in Asia, because this is where we have the growth, in fact, for the same fixed cost, okay, in each of the region, you have less margin for a given volume in Asia than you have in Europe and US.

Okay? This means that in terms of EBITDA, the EBITDA is, let's say, is comparable everywhere, but the unit margin is lower in Asia than they are, and the EBITDA margin is comparable.

Which means that when you have more volume and more development in Asia, it weighs on the average mix for the same fixed cost; it weighs on the EBITDA margin. It's nearly mechanical, in fact.

Okay? Now if you think longer-term, Europe and US, we're confident on that, we recoup volumes, okay, and step by step, it will come back.

We confirm, in fact, we are very happy to confirm the midterm target for Advanced Material, which would be well above the 20%, but it's purely this is what we explain with the mix. With regard to the product mix, I would say no, because if I put aside this geographical discrepancy, in terms of products, we develop the product with a higher margin.

Again, even with themselves, they make more unit margin in Europe and US than they are doing in Asia. Now, on the PVDF investment in China, which is for Asia, it's not just for China, it's for Asia, is really very consistent with our strategy since several years.

We have had many questions on this PVDF. We must say that PVDF, since many years and still today, is an engine of growth and profitability for the company, and we want to develop it globally.

We have this investment in the US, we have this investment in China, and we are quite comfortable that this investment will have quite a good payback. Now, Korea, I don't know, this is I would say their topic, their profile.

With regard to us, we are very comfortable on what we are doing, which shows that the quality of our innovation in PVDF, the positioning, the fact that we really focus on the high end of the range is bringing its fruit. It can be in semiconductor, it can be in batteries, it can be in cables.

I think we have a good and differentiated strategy in PVDF.

Thierry, if you allow me just to follow up. In terms of the Q2 commentary around this business, is it that there are some specific projects ramping—I think you mentioned foldable phones in the intro, for example—that are very high margin, or is it just simply an overall improvement in volumes helps to have better fixed-cost absorption?

We got a few messages because we made the comments. I agree on the HPP and Advanced Material.

In fact, our message was, Q1 was, which, to a certain extent, is linked to your first question. I would say in the mix of Arkema, Advanced Material in the Q1 from our standpoint was maybe the disappointing part.

The message was to say, okay, it's a soft start, but it will ramp up in the second quarter, at least sequentially. We have a good business prospect from the major project, and this major project are for HPP, and also it was to spot the mix in Advanced Material in the Q2 between HPP and Performance Additives, with HPP with, let's say, a positive gross momentum, including PIAM, which is doing pretty well as you mentioned, but beyond PIAM, with PVDF, etc., and polyamide, and specialty fluorogas.

On the other side, Performance Additives being impacted by the Middle East, because this is our business line which is selling the most to Middle East, and they have this sulfur topic. This is more to give you some granularity inside Advanced Material, which will be with, let's say, two contrasted business lines for the quarter.

After that, it can change. Okay?

Thank you, Thierry.

The good thing is that, maybe to complete on that, our major projects, step by step, are ramping up, and this will impact in the short and long term HPP, as you know and as we often mentioned.

Good morning, everyone. First question: obviously you referenced, Thierry, in your answers, the geographic mix, where it's more Asia-led and less strong in Europe and North America.

Do you expect that to change, given the kind of US PMI trajectory, or what we're seeing since the conflict started on the oil price and other places? Then secondly, can I also ask about March?

Obviously stronger than expected. Do you think any of this was customer pre-buying, and perhaps obviously Asia was very strong, and that tends to be the spot market, and where you see perhaps the most current capacity outages?

Thank you.

Thank you for the question. I would say with regard to geographic mix, yes, as we believe in US because we invested a lot there.

It's 35% of our sales, and we believe that from a competitive standpoint, even reinforced by what is happening in Middle East, their competitiveness, especially in terms of energy, is superior. We believe that there are in the US many ingredients for this economy to rebound at a certain point.

This is not what we see today. It depends if your question is short term or long term.

If it is short term, we have to be cautious, and we still see these dynamics coming from Asia. Now, reverse is not really the right point, because it would mean that Asia would get down, which would not be the case, but would rebalance with US getting stronger.

We are at a low point in many of our businesses in the US. We start to see a little bit of green shoots.

They are minimal here and there, which maybe could get us feel that in the course of the year, we should see some improvement, but now there are so many elements in the geopolitics that we have to be careful. With regard to March, maybe there is a little bit of pre-buying, maybe in the more upstream of our businesses, maybe.

Now, when you look at the volume in March, we are just for the company at par compared not for March, but for the quarter, compared to last year. If you take Jan plus Feb plus March, and we have a tendency to look at the whole quarter with different dynamics, slow start and some offset or catch-up in March.

Certainly a little bit of pre-buying. For example, if we look at April, I think we mentioned it in the press release, or I think April is in the continuity of March, which is an element of answer also.

This means that we see the good solid March is continuing in April. We need that to have a Q2 in EBITDA comparable to last year.

Thanks, Thierry.

Yes, good morning. My question is on the downstream businesses, and I guess focused on net pricing.

I was wondering if you could talk about, for the big buckets of adhesives, coatings, and the rest, what are you seeing in terms of raw material inflation right now? Are we talking mid-single digits, low double digits, maybe high teens inflation?

Are you using surcharges, or are you expecting to see, I guess, a pricing commensurate with this type of inflation? When you talk about short-term squeezes on downstream, is it a few quarters or just a few weeks and months?

Okay. With regard to the raw material, all along the place, I would say, but it's not just for downstream businesses, it's for the whole company, you have increase of raw material which can range from a few percent to 100%.

It's really quite quick and quite steep. This is why our teams, unfortunately they were already trained with what has happened during COVID, are really moving very fast to pass price increase.

Now, it's clear, and you know that very well because of your experience, it's quicker in upstream that it is in downstream to pass to the customers. Our feeling is that the more downstream you go, the more we will have to use the full quarter to pass everything.

Our idea is to instantly, I would say, for the end of the quarter. Since we have some businesses, as more upstream that will have some upside effect, it's the case of acrylics in the quarter, it will fully offset the time lag we can have on more downstream businesses.

This is where the strength of the portfolio diversity is playing. Overall, we should be good.

Now, it's clear that you have some different colors starting from upstream to downstream in the quarter. The idea is to have done the full job, for the end of the quarter.

The reason why you have some time lag, the profile of the customer can be very very very different, even their own constraint. This is why, as in the real life, it takes a little bit of time.

Also, the wave of the raw material increase are coming one by one. This means that you need to come back and to say, okay, it's more, we have to pass more, etc.

Real life. Overall, with our and this is why we sort of comment on this EBITDA comparable to last year in Q2, because we believe that with our portfolio, there will be some plus, some minuses, but all in all, we can manage.

It's a job which take a lot of energy from our teams, like I imagine for everybody.

Thank you. Back in 2022, you had very, very strong pricing, even in downstream areas, at the expense of volumes.

I think at the time, you mentioned that there were certain volumes that you were happy to lose because they were lower quality, lower margins. Is there any of this right now, or are you literally now fighting for every molecule, as you see them as high quality and you want to retain those volumes?

It's clear that when you put a lot of emphasis on price increase, especially in the world where you have a war, we should not forget, in Middle East, is not what is going to push volume up very strongly. Let's say that we target more or less flattish volume, okay, and in this flattish volume guideline or context, we push the price.

Okay? It's not exactly like in after COVID, where we have still to rationalize our portfolio, especially in the adhesive, where this job has been done.

Okay? It's more stable, but let's say flattish volume and then we work on pricing.

Okay. Thank you very much.

Thank you. I have three questions.

Firstly, is on acrylic acid. Really, when you look at this product in Europe and the US, for a long time, there hasn't been any capacity added, but margins have continuously sort of drifted downwards.

Now in the backdrop of the war and the tightness in naphtha and propylene in Asia, how do you see the sort of midterm outlook for acrylic acid? Do you think there is a need for capacity rationalization in either Europe or the US, given some of the markets, like India, for instance, have become more and more self-sufficient?

That's my first question. The second is around the sulfur topic.

How do you see the upstream sort of methionine market, or sort of the from your point of view, the mercaptans value chain, given the shortage of sulfur? Have you been able to grab market share, or is this an issue right now from your point of view?

The last question is around PA11. Obviously, you've made a very big investment in Singapore.

When you look at the plant in Singapore today versus your French plant, in terms of operational performance as well as profitability, where do we stand today? Is this now more or less at par in terms of product output, but profitability is yet to join, or how do we stand there?

Thanks a lot. Okay.

With regard to acrylic acid, first of all, we're happy to see, after, as you mentioned, a couple of years of challenges, to see some improvement, and we appreciate that for the team is very important, and is not in detriment of the downstream, which is good. Because you saw the Coating Solutions performance in Q1, which is at par with the previous year, even if the previous year were not great, I think so.

This is a chain which is solid right now. Now, as we mentioned, the tightness, we have no crystal ball.

I think we are cautious because we are just out of 2 years where acrylics were really under pressure. We think that clearly with the conflict, and maybe hopefully beyond the conflict, I think we'll stabilize around more normalized spread.

Let's do it step by step. The first step is to do our job in a market which has changed notably with the Middle East crisis, and we'll see how long will this crisis last.

It's a big parameter, and nobody knows about it. After that, we'll see where we stand and we'll certainly adapt to.

I think the good news is that we benefit from this diversity of the portfolio with some more upstream business and some really downstream businesses. On the sulfur, on the methionine, we are not in the methionine.

We I would say we supplied our customers, this market share is more their topic than our topic. What we do ourselves is to supply them the best way possible.

On the availability of the sulfur, we manage. This is a good news.

Now the sulfur has increased very much, our topic is to increase, and this is where we have some time lag by contract. Not every market is the same, but I would say we find the sulfur.

On Singapore, I would say first of all, the good news is that the Singapore plant is running very well. It took years, as you know.

We started at a low point and we learn a lot, and now it's really a very very nice plant, very very optimized. Compared to Marseille, it's more modern, it should be more profitable.

On the other side, the capacity is smaller than Marseille. I would say all in all, they're comparable to answer your question.

Okay. Thank you.

If there is no more question, I thank you very much for your attention. As usual, don't hesitate to contact the IR team to complete my answers.

Have a nice day to everybody.