Ladies and gentlemen, also from my side, welcome to our call. We hope you've had a chance to review our posted slides as well as our H1 documents available on our website.

After the opening remarks by Christian, we will jump directly into the Q&A session. Some technical notes.

Please refer to our disclaimer on Page 2 of the posted presentation. And a note on data privacy, please be aware that the Teams session will be recorded, webcast and available as an audio replay on our homepage afterwards.

[Operator Instructions] Now I'd like to hand over to Christian, our CEO, for the opening remarks.

Thank you, Julia, and welcome from my side as well. Let's start with the quarter.

Q2 EBITDA was significantly above the last year's Q2 at about EUR 176 million. This was mainly due to the higher ASP, higher volumes and cost discipline, offsetting the pressure from price-related cost increases resulting from the geopolitical environment.

In addition, please remember that we had part of the regular Bethune maintenance break in Q2 last year, and we will have it fully in the third quarter this year. Therefore, this did not weigh on the second quarter this year as it did in 2025.

Furthermore, Q2 last year was burdened by negative noncash valuation effects on receivables related to the U.S. dollar.

In the Industry+ segment, following the strong start into the year, performance continued to exceed expectations in the second quarter, even if seasonally on a lower level. Free cash flow.

Free cash flow reached EUR 40 million. It improved versus last year, but not in the same magnitude as EBITDA due to a higher tie-up in working capital, mainly receivables.

Let's look at the full-year guidance. We raised our 2026 EBITDA forecast to range from EUR 680 million to EUR 760 million compared to EUR 630 million to EUR 730 million before.

This is mainly due to the strong performance in the second quarter. Midpoint is in line with Vara consensus.

That shows that the positive deviation in Q2 results is mainly due to periodical shift between Q3 and Q2, caused, among others, by the described Bethune maintenance effect. The midpoint of the EBITDA range assumes stable potash prices on average during H2, current market price levels for logistical costs and a gas price of USD 45 per megawatt-hour.

We also raised our free cash flow guidance from at least breakeven to mid- to higher double-digit million euro amount, which is also in line with Vara consensus. After this brief introduction, I'm now looking forward to answering your questions with my colleagues, Jens and Julia.

And with this, I hand over to the operator to start the Q&A session.

Congrats on the results. I have 2.5 questions.

I'll ask the first one. First of all, how is the current demand in Brazil heading into the application season in your observation?

What are your salespeople saying on the ground?

Yes. Christian.

Brazil, we saw in the first half of the year record imports and good application. Currently, as we are in between this year's seasons, we see good inventories, but we expect for the second half of the year at least a normal demand in Brazil.

And also, what could have an impact is, yes, the challenge with phosphate that could be that the application of potash, as it is the most affordable nutrient compared to the others, it could change the NPK formula a little bit. So for Brazil, we are optimistic for the second half.

Okay. Great.

Now my hard question. And I admit it's far-fetched, but is there a risk that due to the extreme drought we've seen in Europe, some cultures such as corn might not have taken up the full amount of potash toppings given this year.

And hence, farmers might be incentivized to take a potash holiday in '27 in Europe.

No, that's currently not our expectation. Yes, we have a drought in Europe.

But in different regions, it's totally different. We just discussed it this morning.

Even if you just go 50 kilometers to the north from Kassel, there the corn is pretty good. In Kassel, it's not as good, but we don't expect that will have an impact on the application of potash in Germany.

And Christian, don't forget, potash is the nutrient that is responsible for water stress in plants. So it helps the plants to withstand water stress.

So the farmer who has not applied potash very well will see that the next field where the farmer has applied potash very well is better. So maybe he has also then learned from that.

Well, let's -- I mean, this year is clearly a stress test indeed. Yes.

Now my final and third question, can you elucidate a bit, indeed talking about low water levels, how they affect production in your mines, particularly in [indiscernible]? I'm aware that you might have at some point cooling water issues or not.

Can you elucidate this a bit?

Yes. As we see low water levels in nearly every river in Germany, we also see this in the Ulster River, very close to our Werra site.

And we need cooling water for our production process. As long as we have the wet production process, we switch to a dry process with the Werra 2060.

So until 2028, the mid of 2028, we closely monitor every time the levels in the rivers. And yes, that could have an impact, but we are monitoring this pretty close, and that's with the cooling water we need.

With regard to saline water, we don't have any impact. We don't expect any impact because we are well prepared.

It's David Symonds from BNP Paribas. Could I ask, it looked like deicing was still above last year into Q2, which presumably is some inventory rebuild.

First question, could you tell me where you think inventories are for deicing into next season?

Yes, we have also on a lower level because we are not in the deicing season in Q2, but we still have a good demand, and the inventories are pretty low. So we expect for the rest of the year with the refill orders and also for the -- if we have a normal winter, just a normal deicing demand because there are no buildup of inventories at the other side.

I was also wondering whether there might be a shortfall of inventories into next season, which would have to continue to rebuild at the end of this year. I don't know if you think that's the case.

I think most of the catch-up was done in Q2.

Q2.

Yes.

Okay. Understood.

And then back on the Werra River situation, could you remind -- obviously, 2022 was a very different market in terms of price levels for potash. Is there any guidance you can give on if we saw a repeat of the 2022 shutdown?

Firstly, could you remind whether that was saline water and cooling or if it was just cooling again? And secondly, is there anything you can say on the size of that impact at today's potash prices?

There was no shutdown in 2022. The last shutdown we had was in 2018, and that was fully related to saltwater disposal things, and that is why we improved saltwater management that much.

Understood. Okay.

I think I'm mentioning 2022 because in your annual report, you say if you see a repeat of the 2022 situation, there could be a shutdown or some impact.

Like I said, there was no -- maybe we said if there would be a repeat of the 2018 situation. But to be honest, we have implemented so many measures after 2018 that basically we always said if there comes another dry season like that, we would not have an impact.

Maybe that's due to one allowance we were waiting for, I'm not sure. But the last shutdown related to it was 2018.

Michael Schaefer from ODDO BHF. First question is on relative pricing MOP versus specialty.

So I'm rather looking for your netback plans and production plans into the second half. How do you see -- or how do you do the planning?

So what's the kind of -- is it rather MOP centric? Or are you rather focusing on specialties?

How should we think about the netback planning for the second half on the output?

Yes. As you know, we are permanently optimizing our netbacks with our production mix.

And what's very important that including in our rock salt [indiscernible] site, has included potash, sulfur and magnesium. And so we optimize our netback if we produce SOP on the one hand or if we produce MOP and kieserite.

Kieserite is a sulfur magnesium product on the other hand. So we optimize if we get a higher netback in kieserite or an SOP for the sulfur, especially due to the good price development in sulfur.

And so that's finally a week-by-week decision.

Okay. Second question is on your outlook statement.

At the midpoint, you are still baking in something like EUR 45 per megawatt-hour nat gas price for the remaining 30% open exposure. So I wonder -- I mean, currently, we have EUR 60 at spot.

However, we are below EUR 40 at 1 year forward. So I wonder how you see kind of gas price risk on your side or gas cost risk, let's say, heading into '27, so how your hedging looks like and how are you progressing here?

Very important is what you just mentioned that we only have an open position of 30%, 70% are hedged. We only have a half year to go until the end of the year.

Yes, we included EUR 45 per megawatt-hour for our midpoint. The volatility also addressed that we also expect for the second half of the year.

But even if you calculate the -- currently EUR 60 for the rest of the year, that would have an impact of middle 1-digit million euro amount to our calculations. So we are well positioned with our gas hedge strategy.

And '27 hedging so far?

We have hedged 50% for Europe at a slightly lower price than this year. And for Canada, we were able to manage to hedge 88% at a very nice price level.

Okay. And my final short question.

On your trading revenues, EUR 46 million, rather elevated compared to historical levels. So just give us a bit of a background.

Was there any kind of meaningful earnings contribution from that end? Or was it just a pass-through?

The trading revenues that was the technical MAP that we included in our -- that we now have included in our portfolio with the contract with Elixir, and that was the main effect.

This is Angelina Glazova from JPMorgan. I have 3 short questions this morning.

And my first one is just coming back to the guidance. So you were clear in outlining that the lower end of the guidance assumes some adverse impact from lower water levels.

But what about the midpoint of the guidance? Is anything included?

And for how long would the situation needs to last for the adverse impact to become sort of a base case rather than bear case?

Yes. In the midpoint, we included especially our normal maintenance that we have in Q3.

And then you have a ramp-up phase after the maintenance period that we have just started on Monday at the Werra site. And for the lower end, yes, there we included that it could last for some weeks if we have low water levels, but we feel very comfortable based on the experience that we have with the lower end.

Okay. Understood.

And my second question is about the demand backdrop in Europe. We have seen some increases in SOP pricing at the start of Q3, which were quite nice.

And I'm wondering how this is being perceived by the buyers and whether you think there could be more room for some further increases.

Yes. In Europe, you should keep in mind that we had over the last months, pretty high levels with good netbacks for us.

So the room for additional increases isn't the same compared to the international overseas markets where we had lower price levels and a strong increase of the prices. So that's a little bit different overseas and Europe from the base where you are coming from.

But the sulfur prices are on a good way, and that's included in our assumptions.

And my last question is looking more broadly on the second half outlook. We have potentially an El Nino situation, which could be worse than what we saw in previous years.

So I understand your guidance already implies a broad range of outcomes, and this is, to an extent, incorporated. But do you think there could be some surprise, which is not foreseen by the guidance or drought, maybe potentially wars in the Southern Hemisphere.

So how do you think about incorporating those impacts into your outlook?

Yes. We include the potential El Nino effects in our outlook, but you should keep in mind that in different regions there you have totally different impacts.

There could be some drought in Southeast Asia and Australia. In Brazil, it could be more wet, but in other regions, more dry.

And so in total, we don't expect that it will have a very meaningful impact overall. So as we look globally in all the regions, with the different impacts.

This is Lisa from Morgan Stanley. I have one follow-up on El Nino.

I mean, I know that you -- for this year, you don't expect an impact. But I mean, is there any sort of indication of if there were to be an impact in the second half of 2026 in specific regions in light of a very strong El Nino expected, I mean, would that -- what would change your view on the 2027 demand outlook?

Just sort of any thoughts on that.

So if we have an extreme El Nino with lower harvest, then we will have increasing agriculture commodity prices, and that will compensate the situation from our side.

Okay. And then currently, the potash supply and demand outlook looks pretty tight, if not very balanced, but there are some incremental supplies coming into the market.

I'm not so concerned about BHP because that could take a long time to ramp. But I was curious about your thoughts into 2027 on higher supplies potentially from Acron, who's ramping up a brand-new potash mine.

Sort of any insights of how much volumes they may bring into the market and how that will affect the supply and demand balance?

Yes. And what's very important, Acron is not new for us, that was announced, that we expected, and that's also when we present our calculations what is coming to the market and what is catch-up with additional increases, so a 2% step-up each year.

So that will be -- won't have a big impact from our perspective. And as you addressed BHP, we will see.

They announced they will come with the first volumes by the mid of 2027. What's very important, they are not in the market.

It's a strong spring season in 2027. And even in 2028, there will be only a few volumes from their side.

And so the postponed start of the production is finally helpful for the balance of the market in the future due to the increasing demand that we see over the last years and also for the future.

Sure. And then my final question is on Industry+ and deicing.

I mean, you had a quite strong second quarter with some restocking from the municipalities. Can you share any sort of dynamics on the pricing side?

Should we also foresee higher pricing given sort of the destocking -- restocking -- sorry, restocking element that sits in there?

Yes. So the Industry+ segment overall, including our salt business that we have in total a good demand and good price development.

And with the deicing, we expect for the rest of the year a normal winter, and that's finally included. Yes.

Yes. I think even with regard to the prices, they are on a historic high level.

And so we think that this will stay at least for the next months. And so we will profit from it as we have profited in the past.

I have 2, please. Sebastian Bray from Berenberg Bank.

I should have said the name first. The first one is on open carbon exposure.

There have been some changes recently to EU ETS, so probably not huge in scope, but can you remind me of what the -- under the current system to 2030, K+S has to purchase in terms of carbon credits a year?

Yes. Sure.

Yes. So we have already purchased certificates in the past, and we're also profiting from the free allocation, but you can take as a rule of thumb, EUR 30 million per year is our cost for CO2 certificates.

And now, if there would be changes in the regulation, for instance, the reduction of the certificates, it will not be that strict as already planned, and there could be some tailwind from it.

That's helpful. And I believe Angelina picked up on the question of SOP pricing more broadly, which has picked up a little in the most recent quarter.

But is it possible for this business to get any better into '27? It seems to be really ticking along quite nicely.

How do you think about the 1-year view on this, particularly the MOP prices start to decline?

Yes. What's very important, the sulphur production that was missed over the last weeks or months, you are not able to refill it.

So if there will be a normal sulphur production, especially in the Middle East, then these are only the volumes that then are able to produce, but not more. So we have some back wins with the sulphur, and the sulphur, we are trying to optimize the netbacks, as I just mentioned.

If we are selling SOP or kieserite also, there's a good demand for this magnesium sulphur products, and we try to optimize our sulphur, yes, netbacks in different products.

Just a short one. Can you give us any guidance for the tax rate into the end of this year on a normalized basis?

So we will expect a normal tax rate of roughly 30%. Yes.

Yes. Thanks to all of you for participating in this call, and thanks also for your questions.

And we all wish you a great August with good weather, and in autumn, some rain. Thanks to you, and have a nice day.

Thank you.