Cabot Corp (CBT) 2024 Q2 法說會逐字稿

Good day, everyone, and thank you for standing by. Welcome to the Second Quarter 2024 Cabot's Earnings Conference Call. (Operator Instructions) Please be advised that your today's conference is being recorded. I would now like to hand the conference over to the Vice President, Treasurer and Investor Relations, Steve Delahunt. Please go ahead.

大家好，感謝你們的支持。歡迎參加卡博特 2024 年第二季財報電話會議。 （操作員說明）請注意，您今天的會議正在錄製中。現在我想將會議交給副總裁、財務主管和投資者關係史蒂夫·德拉亨特 (Steve Delahunt)。請繼續。

Thanks, Carmen, and good morning. I would like to welcome you to the Cabot Corporation Earnings Teleconference. With me today are Sean Keohane, CEO and President; and Erica McLaughlin, Executive Vice President and CFO. Last night, we released results for our second quarter of fiscal year 2024, copies of which are posted in the Investor Relations section of our website. The slide deck that accompanies this call is also available on the Investor Relations portion of our website and will be available in conjunction with the replay of the call.

謝謝，卡門，早安。歡迎您參加卡博特公司收益電話會議。今天與我在一起的有執行長兼總裁 Sean Keohane；以及執行副總裁兼財務長 Erica McLaughlin。昨晚，我們發布了 2024 財年第二季的業績，其副本發佈在我們網站的投資者關係部分。本次電話會議附帶的幻燈片也可在我們網站的投資者關係部分獲取，並將與電話會議重播一起提供。

During this conference call, we will make forward-looking statements about our expected future operational and financial performance. Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those projected in such statements. Additional information regarding these factors appears in the press release we issued last night and in our 10-K for the fiscal year ended September 30, 2023, and in subsequent filings we make with the SEC.

在本次電話會議期間，我們將就我們預期的未來營運和財務表現做出前瞻性聲明。每項前瞻性陳述都存在風險和不確定性，可能導致實際結果與此類陳述中預測的結果有重大差異。有關這些因素的更多資​​訊出現在我們昨晚發布的新聞稿、截至 2023 年 9 月 30 日的財年 10-K 以及我們隨後向 SEC 提交的文件中。

In order to provide greater transparency regarding our operating performance, we refer to certain non-GAAP financial measures that involve adjustments to GAAP results. The non-GAAP financial measures referenced on this call are reconciled to the most directly comparable GAAP financial measure in a table at the end of our earnings release issued last night and available in the Investors section of our website. I will now turn the call over to Sean, who will discuss the second quarter highlights, followed by an update on our capital allocation framework and then discuss the company's efforts in sustainable product innovation. Erica will review the second quarter financial highlights and the business segment results. Following this, Sean will provide an update on our 2024 outlook and then open the floor to questions. Sean?

為了提高我們經營績效的透明度，我們參考了某些涉及對 GAAP 結果進行調整的非 GAAP 財務指標。本次電話會議中引用的非公認會計原則財務指標與我們昨晚發布的收益報告末尾的表格中最直接可比較的公認會計原則財務指標進行了調整，該表格可在我們網站的投資者部分找到。我現在將把電話轉給肖恩，他將討論第二季度的亮點，然後介紹我們資本配置框架的最新情況，然後討論公司在可持續產品創新方面的努力。艾麗卡將回顧第二季的財務亮點和業務部門的表現。隨後，Sean 將提供我們 2024 年展望的最新信息，然後開放提問。肖恩？

Thank you, Steve. Good morning, ladies and gentlemen, and welcome to our call today. I'm very pleased with results in the second quarter and the tremendous efforts of the Cabot team to execute against what is still a challenging macroeconomic backdrop. In the second quarter, we delivered adjusted earnings per share of $1.78, up 34% year-over-year, driven by growth in both segments.

謝謝你，史蒂夫。早安，女士們先生們，歡迎今天致電我們。我對第二季的業績以及卡博特團隊在仍然充滿挑戰的宏觀經濟背景下所付出的巨大努力感到非常滿意。在這兩個細分市場成長的推動下，第二季我們的調整後每股收益為 1.78 美元，年增 34%。

Reinforcement Materials delivered very strong results in the quarter with EBIT up 22% year-over-year to $149 million. The outlook for this business remains strong, driven by our leading global market position, the long-term resilience of the replacement tire market, favorable regional supply and demand dynamics and outstanding execution across the segment.

增強材料本季取得了非常強勁的業績，息稅前利潤年增 22%，達到 1.49 億美元。在我們領先的全球市場地位、替換輪胎市場的長期彈性、有利的區域供需動態以及整個細分市場出色的執行力的推動下，該業務的前景依然強勁。

EBIT in Performance Chemicals was up 11% compared to the second quarter of fiscal 2023 and as demand in the segment appears to have generally stabilized and the effects of destocking have ended. While we did see some early signs of improvement in demand particularly in our automotive, infrastructure and semiconductor applications. We remain cautious if these demand trends will further strengthen through the rest of the year.

與 2023 財年第二季相比，高性能化學品的息稅前利潤增加了 11%，因為該領域的需求似乎總體穩定，而且去庫存的影響已經結束。雖然我們確實看到了需求改善的一些早期跡象，特別是在我們的汽車、基礎設施和半導體應用領域。如果這些需求趨勢在今年剩餘時間內進一步加強，我們仍保持謹慎態度。

Operating cash flow was strong in the quarter at $176 million, which supported the return of $47 million to shareholders through a combination of share repurchases and dividends. Given the strength of our underlying business fundamentals and conviction in the long-term cash flow generation of our portfolio, yesterday, we announced an 8% increase in our quarterly dividend. Cabot has a long history of growing the dividend and it would be our expectation to continue increasing the dividend over time as the earnings and cash flow of our business grow.

本季營運現金流強勁，達 1.76 億美元，透過股票回購和股息相結合，為股東帶來了 4,700 萬美元的回報。鑑於我們強勁的業務基本面以及對投資組合長期現金流產生的信心，昨天，我們宣布將季度股息增加 8%。卡博特在增加股息方面有著悠久的歷史，隨著我們業務的利潤和現金流的增長，我們預計將繼續增加股息。

The Cabot portfolio has strong cash flow characteristics, which enable a balanced capital allocation strategy focused on funding our high confidence, high-return growth projects and returning cash to shareholders. This balance of profit growth and cash return can be achieved while maintaining our strong investment-grade balance sheet.

卡博特投資組合具有強大的現金流特徵，可實現平衡的資本配置策略，重點為我們的高信心、高回報成長項目提供資金，並向股東返還現金。在維持我們強勁的投資等級資產負債表的同時，可以實現利潤成長和現金回報的平衡。

Despite a weak macroeconomic environment in fiscal year 2023 and the year marked by sharp inventory destocking, we generated very strong operating cash flow of $595 million. And year-to-date in fiscal 2024, operating cash flow has totaled $281 million. Cash generation is expected to remain strong, and we intend to return a robust amount of cash to shareholders through dividends and share repurchases.

儘管 2023 財年宏觀經濟環境疲軟且庫存大幅去化，但我們仍產生了 5.95 億美元的強勁營運現金流。 2024 財年迄今，營運現金流總計 2.81 億美元。現金產生預計將保持強勁，我們打算透過股息和股票回購向股東返還大量現金。

We've maintained a continuous and growing dividend since 1968, which is the year the company went public, and that commitment remains a core element of our capital allocation strategy. Since fiscal 2015, our dividend has grown at a compound annual growth rate of 7%, including our announcement last night of an 8% dividend increase. We remain committed to the dividend and expect to maintain an industry competitive yield and payout ratio over time. We also believe that share repurchases are an attractive use of cash. Since 2015, with the exception of the COVID impact in fiscal 2021, we have repurchased shares at a minimum to offset dilution from incentive compensation plans and in most years, have been opportunistic with repurchases in excess of dilution.

自 1968 年（公司上市那一年）以來，我們一直保持持續成長的股息，這項承諾仍然是我們資本配置策略的核心要素。自2015財年以來，我們的股利以7%的複合年增長率成長，包括我們昨晚宣布的股利增加8%。我們仍然致力於派發股息，並期望隨著時間的推移保持行業有競爭力的收益率和派息率。我們也認為，股票回購是一種有吸引力的現金用途。自2015 年以來，除了2021 財年新冠疫情的影響外，我們至少回購了股票，以抵消激勵薪酬計劃帶來的稀釋，並且在大多數年份，我們一直在機會主義的情況下回購超過稀釋的股份。

Year-to-date, we have repurchased $57 million. And since 2015, we have repurchased approximately $700 million of shares and reduced our share count by 9 million shares or 14% of our outstanding shares. We expect to continue being opportunistic given our strong cash flow, the structural improvements in our Reinforcement Materials business and the long-term growth potential of our portfolio driven by sustainability tailwinds.

年初至今，我們已回購了 5,700 萬美元。自 2015 年以來，我們回購了約 7 億美元的股票，並減少了 900 萬股，即已發行股票的 14%。鑑於我們強勁的現金流、增強材料業務的結構性改善以及可持續發展推動下的投資組合的長期成長潛力，我們預計將繼續抓住機會。

Cabot has long been recognized as a leader in sustainability, consistently acknowledged by external parties for excellence in this area. While operating responsibly has been deeply embedded in our practices for decades, we also have a rich opportunity pipeline for growth driven by sustainability tailwinds.

卡博特長期以來一直被公認為永續發展領域的領導者，並因其在該領域的卓越表現而受到外部各方的一致認可。儘管幾十年來，負責任的營運已深深植根於我們的實踐中，但我們也擁有豐富的可持續發展機會所推動的成長機會。

I would like to highlight a few recent developments that showcase the sustainability-driven growth potential of our portfolio. Recently, our E2C product line earned the award for innovation and excellence at the 2024 Tire Technology Expo, the premier tire industry technology showcase. Specifically, we were recognized in the chemicals and compounding Innovation of the Year category for our Engineered Elastomer Composites platform.

我想強調一些最近的發展，這些發展展示了我們投資組合的可持續驅動的成長潛力。最近，我們的 E2C 產品線在輪胎行業首屈一指的技術展示會——2024 年輪胎技術博覽會上榮獲創新和卓越獎。具體來說，我們的工程彈性體複合材料平台在年度化學品和複合創新類別中獲得認可。

Our E2C-DX-9660 elastomer composite produced through a proprietary and patented mixing process, enhances tire performance by increasing abrasion resistance by approximately 30% without compromising rolling resistance when compared to conventional rubber compounds.

與傳統橡膠化合物相比，我們的 E2C-DX-9660 彈性體複合材料透過專有的專利混合製程生產，可將耐磨性提高約 30%，同時不影響滾動阻力，從而增強輪胎性能。

The E2C platform has been validated by global customers and our products are being sold in the tire market. Additionally, our E2C platform offers an array of products tailored to meet the needs of tire manufacturers and industrial rubber applications, combining performance with sustainability benefits.

E2C平台已得到全球客戶的驗證，我們的產品正在輪胎市場銷售。此外，我們的 E2C 平台提供一系列專為滿足輪胎製造商和工業橡膠應用的需求而客製化的產品，將性能與永續性優勢相結合。

In the quarter, we also launched our new PROPEL E8 engineered reinforcing carbon black designed specifically to address the unique challenges of increased weight and torque posed by electric vehicles. The higher weight and torque of EVs drive an increase in tire wear. PROPEL E8 addresses these issues by delivering low rolling resistance and enhanced tread durability, thereby extending tire life.

在本季度，我們還推出了新型 PROPEL E8 工程增強炭黑，專門用於解決電動車重量和扭力增加帶來的獨特挑戰。電動車的重量和扭矩較高，導致輪胎磨損增加。 PROPEL E8 透過提供低滾動阻力和增強胎面耐久性來解決這些問題，從而延長輪胎壽命。

Finally, Cabot and our commercial partners were recently awarded a $5 million grant by the U.S. Department of Energy under the bipartisan infrastructure law. This research grant is intended to support the development of fuel cells. Fuel cells are particularly critical in the electrification of long distance transportation due to their ability to manage extended driving ranges and heavier loads, challenges that are difficult to overcome with battery technology. This project will focus on developing an innovative and scalable manufacturing process for producing specialized carbons, which will serve as catalyst supports for fuel cells.

最後，卡博特和我們的商業合作夥伴最近根據兩黨基礎設施法案獲得了美國能源部 500 萬美元的撥款。該研究補助金旨在支持燃料電池的開發。燃料電池在長途運輸的電氣化中尤其重要，因為它們能夠應對更長的行駛里程和更重的負載，而這些挑戰是電池技術難以克服的。該專案將重點開發一種創新且可擴展的製造工藝，用於生產專用碳，作為燃料電池的催化劑載體。

Although this initiative is in its early stages, we believe that our collaboration with partners and our collective expertise position us to make substantial contributions to the hydrogen economy, further driving forward the United States leadership in clean energy technologies. These long-term initiatives reflect our deep commitment to innovation and sustainability demonstrating our proactive role in shaping a more sustainable future across various aspects of the mobility and energy sectors.

儘管這一舉措還處於早期階段，但我們相信，我們與合作夥伴的合作以及我們的集體專業知識使我們能夠為氫經濟做出重大貢獻，進一步推動美國在清潔能源技術方面的領導地位。這些長期措施反映了我們對創新和永續發展的堅定承諾，展示了我們在交通和能源領域各個方面塑造更永續的未來方面所發揮的積極作用。

I'll now turn the call over to Erica to discuss the segment and financial performance in the quarter. Erica?

我現在將電話轉給艾莉卡，討論本季的部門和財務表現。艾麗卡？

Thanks, Sean. I will start with discussing results for the company and then review the segment results. Adjusted EPS for the second quarter of fiscal 2024 was $1.78 compared to $1.33 in the second quarter of fiscal 2023, with growth coming from both the Reinforcement Materials and Performance Chemicals segments. Cash flow from operations was strong at $176 million in the quarter, which included a working capital decrease of $21 million. Discretionary free cash flow was $128 million in the quarter.

謝謝，肖恩。我將從討論公司的表現開始，然後審查分部績效。 2024 財年第二季調整後每股收益為 1.78 美元，而 2023 財年第二季調整後每股收益為 1.33 美元，成長來自增強材料和高性能化學品領域。本季營運現金流強勁，達 1.76 億美元，其中營運資本減少 2,100 萬美元。本季可自由支配的自由現金流為 1.28 億美元。

We ended the quarter with a cash balance of $206 million, and our liquidity position remains strong at approximately $1.3 billion. Capital expenditures for the second quarter of fiscal 2024 were $43 million, and we continue to expect $250 million to $275 million of capital spending for the fiscal year. Additional uses of cash during the second quarter were $23 million for dividends and $24 million for share repurchases.

本季結束時，我們的現金餘額為 2.06 億美元，流動性狀況依然強勁，約 13 億美元。 2024 財年第二季的資本支出為 4,300 萬美元，我們繼續預期本財年的資本支出為 2.5 億至 2.75 億美元。第二季額外使用的現金包括 2,300 萬美元用於股利和 2,400 萬美元用於股票回購。

Our debt balance was $1.2 billion at the end of March, and our net debt-to-EBITDA was 1.3x. The operating tax rate for the second quarter of fiscal 2024 was 28% and we anticipate our operating tax rate for fiscal 2024 to be in the range of 27% to 29%. One additional item to note is the benefit seen in the general unallocated income line item. As we discussed last quarter, this line item of general unallocated income and expense includes currency exposures related to our net asset positions and investment income we earned mainly in the South America region as well as interest income on our global cash balances.

截至 3 月底，我們的債務餘額為 12 億美元，淨債務與 EBITDA 比率為 1.3 倍。 2024 財年第二季的營業稅率為 28%，我們預期 2024 財年的營業稅率將在 27% 至 29% 範圍內。需要注意的另一項是一般未分配收入項目中看到的收益。正如我們上季度討論的那樣，一般未分配收入和支出的這一行項目包括與我們的淨資產頭寸相關的貨幣風險敞口和我們主要在南美地區賺取的投資收入以及我們的全球現金餘額的利息收入。

During the quarter, we reported a $15 million benefit in general unallocated income, which was higher than our prior quarter guidance of $7 million to $9 million. The net benefit was largely due to a slower rate of depreciation in the Argentina peso than expected, while we continue to earn interest on the cash and investments during most of the quarter in that country.

在本季度，我們報告了 1500 萬美元的一般未分配收入收益，高於我們上一季指導的 700 萬至 900 萬美元。淨收益主要是由於阿根廷比索的貶值速度低於預期，而我們在該國本季的大部分時間裡繼續透過現金和投資賺取利息。

At the time of the Argentinian government evaluation in December, there were mandated regulations put into place on how companies could pay offshore supplier balances outstanding as of that date. In March, we followed the regulated path for this and applied for and purchased an allocation of government bonds that could be sold at a discount and used to pay offshore suppliers.

阿根廷政府於 12 月進行評估時，已就公司如何支付截至該日的離岸供應商未清餘額制定了強制性規定。 3月份，我們依照規範路徑申請併購買了一批可以折價出售的政府債券，用於支付境外供應商的款項。

Cabot purchased $30 million of bonds, which were immediately sold, resulting in an $8 million loss. We treated this loss as a certain item as it was still part of the government control of around the access to and use of U.S. dollars related to the government evaluation in December. The purchase and sale of the bonds and the recent evaluations have resulted in a much lower U.S. dollar cash balance. So going forward, we expect the earnings volatility from Argentina to be minimal.

卡博特購買了 3000 萬美元的債券，但立即出售，導致損失 800 萬美元。我們將這一損失視為一個特定項目，因為它仍然是政府對與 12 月政府評估相關的美元獲取和使用的控制的一部分。債券的買賣以及最近的評估導緻美元現金餘額大幅下降。因此，展望未來，我們預期阿根廷的獲利波動將很小。

We can now pay offshore suppliers over a mandated time line, which we would expect to do in the normal course of business going forward. Therefore, we would not expect the level of income from the Argentina investments nor the impact from the volatility of the Argentina peso currency for the remainder of the year in the general unallocated income and expense line items. While global currency movements are difficult to predict, as we look ahead, we would expect general unallocated income to be around $5 million to $7 million of income per quarter driven by the interest income and the net FX impacts on our global cash balances.

我們現在可以在規定的時間內向離岸供應商付款，我們希望在未來的正常業務過程中這樣做。因此，我們預計今年剩餘時間內阿根廷投資的收入水準或阿根廷比索貨幣波動的影響不會出現在一般未分配收入和支出項目中。雖然全球貨幣走勢難以預測，但展望未來，我們預計每季一般未分配收入約為 500 萬至 700 萬美元，這是由利息收入和淨外匯對我們全球現金餘額的影響所推動的。

Now moving to Reinforcement Materials. During the second quarter, EBIT for Reinforcement Materials was $149 million, which was an increase of $27 million as compared to the same period in the prior year. The increase is driven by higher pricing and product mix in our 2024 calendar year customer agreements and higher volumes. Globally, volumes were up 6% in the second quarter as compared to the same period of the prior year due to 21% growth in Asia and 4% in Europe.

現在轉向增強材料。第二季度，增強材料業務的息稅前利潤為 1.49 億美元，比去年同期增加 2,700 萬美元。這一增長是由於我們 2024 日曆年客戶協議中更高的定價和產品組合以及更高的銷量所推動的。全球範圍內，第二季銷量較去年同期成長 6%，其中亞洲成長 21%，歐洲成長 4%。

Looking to the third quarter of fiscal 2024, we expect the Reinforcement Materials EBIT to be roughly in line with the second quarter of fiscal 2024 and with modest sequential volume improvement expected from demand recovery in South America, offset by higher plant maintenance costs and lower energy pricing.

展望 2024 財年第三季度，我們預計增強材料息稅前利潤將與 2024 財年第二季度大致持平，南美需求復甦預計銷量將出現適度環比改善，但工廠維護成本上升和能源下降所抵消價錢。

Now turning to Performance Chemicals. EBIT increased by $3 million in the second fiscal quarter as compared to the same period in fiscal 2023. The increase was driven by 6% higher volumes driven by our Specialty Carbons and Specialty Compounds product line. Looking ahead to the third quarter of fiscal 2024, we expect modest volume improvement sequentially as we are seeing some early signs of strengthening demand in specialty carbons and compounds and we expect margins to hold sequentially as pricing moves in line with raw material costs. I will now turn the call back over to Sean to discuss the fiscal year outlook. Sean?

現在轉向高性能化學品。與 2023 財年同期相比，第二財季的息稅前利潤增加了 300 萬美元。展望 2024 財年第三季度，我們預計銷售量將連續適度改善，因為我們看到了特種碳和化合物需求增強的一些早期跡象，並且隨著定價與原材料成本一致，我們預計利潤率將連續保持不變。我現在將把電話轉回給肖恩，討論財政年度前景。肖恩？

Thanks, Erica. Moving to our 2024 outlook. We are very pleased with the momentum coming out of the second quarter, and we feel good about the back half of the year. Based on our year-to-date results and the outlook across our businesses, we are raising our guidance for adjusted earnings per share to be in the range of $6.65 to $6.85 for the fiscal year. The upward revision represents a $0.20 increase at the midpoint compared to our prior guidance. At a strategic level, the key drivers for earnings growth remain unchanged. The impact from our calendar year 2024 Reinforcement Materials customer agreements and the resilience of the replacement tire market are driving the strength in this segment.

謝謝，艾麗卡。展望 2024 年。我們對第二季的勢頭感到非常滿意，我們對今年下半年的情況感覺良好。根據我們今年迄今的業績和整個業務的前景，我們將本財年調整後每股收益的指導上調至 6.65 美元至 6.85 美元之間。與我們之前的指導相比，向上修正意味著中點增加了 0.20 美元。從策略層面來看，獲利成長的主要驅動因素保持不變。 2024 年增強材料客戶協議的影響和替換輪胎市場的彈性正在推動該領域的發展。

As discussed in prior quarters, we expect year-over-year volume growth in the second half of the year as the customer destocking we experienced in fiscal '23 is not expected to repeat. These factors are driving our expectation for another year of strong double-digit EBIT growth in the Reinforcement Materials segment.

正如前幾季所討論的，我們預計下半年銷售量將年增，因為我們在 23 財年經歷的客戶去庫存預計不會重演。這些因素促使我們預期增強材料領域的息稅前利潤將再次達到兩位數的強勁成長。

In Performance Chemicals, we are beginning to see some early signs of end market improvement, most notably in our automotive, infrastructure and semiconductor applications with volumes expected to be modestly higher sequentially. We are optimistic that demand trends will continue to improve in this segment as we head into fiscal year 2025.

在高性能化學品領域，我們開始看到終端市場改善的一些早期跡象，尤其是在我們的汽車、基礎設施和半導體應用領域，預計銷售量將連續小幅上升。我們樂觀地認為，隨著 2025 財年的到來，該領域的需求趨勢將持續改善。

Our balance sheet is strong. Cash generation is expected to remain robust and we will continue to pursue a balanced capital allocation strategy of growth investments and cash returned to shareholders.

我們的資產負債表強勁。現金產生預計將保持強勁，我們將繼續追求成長投資和股東現金回饋的平衡資本配置策略。

In addition to the 8% dividend increase we announced yesterday, we intend to remain opportunistic with our share repurchases going forward. Overall, I'm very pleased with how the company is positioned today. I'm confident in our strategy and the execution capability of our team, and I'm excited about the growth prospects of our portfolio. We are executing well in fiscal year 2024 and we remain on track to meet our 2021 Investor Day consolidated targets. Thank you very much for joining us today, and I will now turn the call back over for our Q&A session.

除了我們昨天宣布的股息增加 8% 之外，我們還打算在未來的股票回購中保持機會主義。總的來說，我對公司今天的定位非常滿意。我對我們的策略和團隊的執行能力充滿信心，我對我們投資組合的成長前景感到興奮。我們在 2024 財年執行良好，仍有望實現 2021 年投資者日綜合目標。非常感謝您今天加入我們，我現在將把電話轉回我們的問答環節。

(Operator Instructions) All right. Our first question comes from the line of David Begleiter with Deutsche Bank.

（操作員指示）好的。我們的第一個問題來自德意志銀行的 David Begleiter。

Sean, what are you seeing ahead of the July 1st ban on Russian carbon black imports or exports to Europe?

Sean，在 7 月 1 日禁止俄羅斯炭黑進口或出口到歐洲之前，您有何看法？

Sorry, say it again, David, there was a little noise on the phone there.

抱歉，大衛，再說一遍，電話裡有一點噪音。

So what are you seeing ahead of the July 1st ban on Russian Carbon Black exports to Europe? Any change, any further change in market or buyer behavior?

那麼，在 7 月 1 日禁止俄羅斯炭黑向歐洲出口之前，您有何看法？市場或買家行為有任何改變、任何進一步的改變嗎？

Yes. So the date, as you know, goes into effect the sanction date, June 30, and we fully expect and our customers fully expect that will happen. And we've been seeing a continued trend ever since the sanctions were announced of reducing carbon black exports out of Russia into Europe.

是的。因此，如您所知，該日期將於 6 月 30 日生效，我們完全期望，我們的客戶也完全期望這將會發生。自從制裁宣布以來，我們一直看到減少俄羅斯向歐洲出口炭黑的趨勢。

So we fully expect that, that will be in effect on that on that date. We are through the last year contracting period, regional supply was certainly an important dynamic in the negotiations. And we saw that play out. And certainly, as we are getting closer here, many of our global customers with significant operations in Europe, are reaching out for incremental spot purchases for 2024, and they remain keen to secure long-term supply in that region.

因此，我們完全預計這將在該日期生效。我們已經經歷了去年的合約期，區域供應無疑是談判中的重要動力。我們看到了這種情況的發生。當然，隨著我們離這一目標越來越近，我們許多在歐洲擁有重要業務的全球客戶正在尋求 2024 年增量現貨採購，並且他們仍然渴望確保該地區的長期供應。

Now while our business is largely contracted there and our excess supply in Europe is limited. We are working to support our global customers from our asset base around the world as best we can. But clearly, this is something that is going into effect that has been playing out over some period of time here. And as the date gets even closer there's continued push for what is remaining to find alternative sources for it. So we'll continue to work closely with our customers to try to help them from our global asset base as best we can.

現在，雖然我們在那裡的業務很大程度上萎縮了，但我們在歐洲的過剩供應也有限。我們正在努力利用遍布世界各地的資產基礎，竭盡全力為全球客戶提供支援。但顯然，這已經是一段時間以來正在發生的事情了。隨著日期越來越近，人們繼續努力尋找剩餘的替代來源。因此，我們將繼續與客戶密切合作，盡力利用我們的全球資產基礎為他們提供協助。

Very good. And just on your guidance, based on good Q3 guidance, which results in implied Q4 guidance, I believe, which is down sequentially. Is that just being conservative? Or is that just a normal behavior -- normal seasonal trends you're seeing?

非常好。我相信，僅根據您的指導，基於良好的第三季度指導，這會導致隱含的第四季度指導，該指導會連續下降。這只是保守嗎？或者這只是一種正常行為——您所看到的正常季節性趨勢？

Yes. Maybe I'd ask Erica and she can walk through that for you, Dave.

是的。也許我會問艾莉卡，她可以為你解決這個問題，戴夫。

Sure. In terms of the Q3 outlook, David?

當然。就第三季的前景而言，大衛？

What that means for the implied Q4 guidance, it looks to me like it would be down sequentially quarter-over-quarter. Is that just being conservative? Or is that what you expect to see or normally do see in Q4 versus Q3?

這對於隱含的第四季指引意味著什麼，在我看來，它將環比下降。這只是保守嗎？或者這是您期望在第四季度與第三季度中看到或通常看到的情況嗎？

Yes. So I think in terms of the business results, the drivers of the outlook is the first half has been quite strong, and we do expect an increase in the segment EBIT as compared to the prior guidance. And as we talked about a modest increase in the volumes going forward in both Reinforcement Materials and in Performance Chemicals. I think the other item of it was what I talked about, which was the general unallocated income and expense, where we've seen a large benefit in this previous quarter that we would expect to decrease. So we saw $15 million in Q2, and we would expect that to go down to about $7 million to $9 million in the back half, and that's how we would see the next 2 quarters developing.

是的。因此，我認為就業務成果而言，前景的驅動因素是上半年相當強勁，我們確實預計該部門的息稅前利潤將比之前的指導有所增長。正如我們所討論的那樣，增強材料和高性能化學品的產量將略有增加。我認為另一項是我談到的，即一般未分配的收入和支出，我們在上一季看到了巨大的收益，我們預計會減少。因此，我們在第二季度看到了 1500 萬美元，我們預計下半年將下降到約 700 萬至 900 萬美元，這就是我們未來兩個季度的發展情況。

One moment for our next question, please. And it comes from the line of John Roberts with Mizuho.

請稍等一下我們的下一個問題。它來自約翰·羅伯茨和瑞穗的血統。

Back on capital allocation, could you update us on any M&A under review? And are there any other major capital programs being anticipated at this point?

回到資本配置，您能否向我們介紹正在審查的任何併購的最新情況？目前預計還有其他重大資本計畫嗎？

Thanks. Maybe just a quick recap of the priorities from a capital allocation standpoint. Certainly, our first priority is to make sure that we invest in the right level of maintenance and compliance in our plans to ensure that the assets operate well and will continue to generate the strong results that we're seeing now and we'll continue to support our customers. That's what they've come to expect.

謝謝。也許只是從資本配置的角度快速回顧優先事項。當然，我們的首要任務是確保我們在計劃中投資於適當水平的維護和合規性，以確保資產運作良好，並將繼續產生我們現在看到的強勁成果，我們將繼續支持我們的客戶。這就是他們所期望的。

So that's first and foremost. Now we plan to continue to invest for growth and so as the next priority, and so this means investing to make sure we have sufficient capacity as we build out our targeted growth vectors in batteries and in jet for packaging, for example, but as well as some strategic investments in reinforcement, in particular, a new unit in Indonesia that's well underway at this point, supporting the strong growth in the ASEAN market.

所以這是首要的。現在，我們計劃繼續投資促進成長，並將其作為下一個優先事項，這意味著投資以確保我們有足夠的能力，例如在電池和包裝用噴射機領域建立目標成長向量，但也作為一些強化策略投資，特別是目前正在順利進行的印尼新工廠，支持了東協市場的強勁成長。

I would say third is, of course, the dividend and maintaining a strong and growing dividend over time as the earnings and cash flow grow, and then finally being opportunistic with share repurchases. Now with respect to M&A, I can't comment specifically, but M&A remains a piece of the strategy where it supports our chosen strategy. So where we can strengthen our existing position in our markets, whether there are established core businesses or our targeted growth vectors, we will certainly be very active looking at opportunities on the M&A front to support the strength in those areas.

我想說的第三個當然是股息，隨著利潤和現金流的增長，隨著時間的推移保持強勁且不斷增長的股息，最後通過股票回購來機會主義。現在關於併購，我無法具體發表評論，但併購仍然是策略的一部分，它支持我們選擇的策略。因此，只要我們能夠加強我們在市場中的現有地位，無論是現有的核心業務還是我們的目標成長載體，我們肯定會非常積極地尋找併購方面的機會，以支持這些領域的實力。

And then did the strength in specialty carbons include battery material strength. And it looked like inks and fumed silica were probably stable year-over-year. what's going on in those markets?

然後特種碳的強度也包括電池材料的強度。看起來油墨和氣相二氧化矽可能較去年同期穩定。這些市場發生了什麼事？

Yes. So overall, we did see higher volumes across the segment in the quarter heavily driven by our specialty carbons and specialty compounds product lines. In the areas where we're seeing the early signs of improvement, certainly across the automotive applications that was pretty good as well as infrastructure. So this is where we sell carbons and compounds that go into wire and cable applications for the build-out of the grid and connecting alternative energy like offshore wind farms and the like.

是的。因此，總體而言，我們確實看到本季整個細分市場的銷售量增加，這在很大程度上是由我們的特種碳和特種化合物產品線所推動的。在我們看到改善的早期跡象的領域，當然在汽車應用和基礎設施方面都非常好。因此，我們在這裡銷售碳和化合物，這些碳和化合物用於電線和電纜應用，用於建造電網和連接離岸風電場等替代能源。

So that infrastructure sector was pretty good. And then in fuel metal oxides, I would say silicones remains, I would say, in a still somewhat weak position overall in terms of demand but was positive to see that the semiconductor side of that business, there was a pickup in demand after a fairly long prolonged destocking in semiconductor. So that's positive to see.

所以說基礎設施領域還是相當不錯的。然後，在燃料金屬氧化物方面，我想說的是，就需求而言，有機矽總體上仍然處於弱勢地位，但看到該業務的半導體方面，在經歷了相當長的一段時期後，需求有所回升，這是積極的。所以這是積極的。

And with respect to batteries, our volumes were higher year-over-year. So that's positive. Certainly, the EV market is still growing at a pretty good clip, mostly driven by China, but production of batteries are expected to lag EV sales this year because there's still quite a bit of inventory in the chain. But that hopefully gives you a sense for the different product lines that are inside of Performance Chemicals and some of the end market applications where we're starting to see some early signs of pickup, which is good to see.

電池方面，我們的銷量較去年同期有所增加。所以這是積極的。當然，電動車市場仍在以相當不錯的速度成長，主要是由中國推動的，但今年電池的生產預計將落後於電動車的銷售，因為鏈條中仍然有相當多的庫存。但這希望能讓您了解高性能化學品內部的不同產品線以及一些終端市場應用，在這些應用中我們開始看到一些回升的早期跡象，這是很高興看到的。

One moment for our next question, please. And it comes from the line of Josh Spector with UBS.

請稍等一下我們的下一個問題。它來自瑞銀集團的喬許‧斯佩克特 (Josh Spector)。

So I wanted to ask on performance and specifically margins. So margins stepped down sequentially, and you're kind of back to levels in the first half of last year. And Erica, when you talked about the forward guidance, you were talking about price offsetting cost. So I guess what needs to happen for margins in that segment to get back to the low to mid-teens? And is there a scenario where that happens this year? Or is that more of a further out prospect?

所以我想詢問性能，特別是利潤率。因此，利潤率連續下降，有點回到去年上半年的水平。艾莉卡（Erica），當您談論前瞻性指導時，您談論的是價格抵消成本。所以我猜想該細分市場的利潤率需要做什麼才能回到十幾歲左右的水平？今年是否會出現這種情況？或者說這是一個更遠的前景？

Yes. Thanks, Josh, for the question. So I think if you recall last quarter we talked about -- this quarter had some higher maintenance and reduction of inventory, which impacted the margins. And so that did happen. And I'd say the business performed as expected. I think as we go forward, as we talked about, we expect some improvement in volume, a modest improvement from the Q2 levels. And then we wouldn't expect the same level of the inventory impact. So I think that you would see the margin return a bit to maybe what you saw in the Q1 levels. I think to get too higher, it's going to be the leverage on the volumes. I think our pricing is holding up quite well. And so as we see changing raw material costs, energy inputs, et cetera, we're able to hold those margins, and we just -- as volumes improve, I think you would see the overall EBITDA margins of the business improve.

是的。謝謝喬希的提問。所以我想如果你還記得上個季度我們談到的——這個季度有一些更高的維護和庫存減少，這影響了利潤率。事情確實發生了。我想說的是，該業務的表現符合預期。我認為，隨著我們的前進，正如我們所討論的，我們預計銷量會有所改善，比第二季度的水平略有改善。然後我們預計不會出現同樣水準的庫存影響。因此，我認為您會看到利潤率略有回升至第一季的水平。我認為要變得太高，這將是對銷售的槓桿作用。我認為我們的定價保持得很好。因此，當我們看到原材料成本、能源投入等不斷變化時，我們能夠保持這些利潤，而且隨著產量的提高，我認為您會看到業務的整體 EBITDA 利潤率有所提高。

That's helpful. And I guess in terms of your innovations, the comments on the carbon catalyst, and I guess the grants you got for that, that's maybe an opportunity we haven't talked about much. Is that sizable? I guess, can you talk about that a little bit?

這很有幫助。我想就您的創新、對碳催化劑的評論以及您為此獲得的資助而言，這可能是我們還沒有談論太多的機會。有那麼大嗎？我想，你能談談這個嗎？

Yes, Josh. I think the right way to think about it is certainly most people view fuel cells as being part of the energy transition and there's quite a bit of investment across the U.S. and Europe, although it's very early days, building out "hydrogen hubs." And so I think there will be a place for hydrogen in the overall long term transition here. Certainly, batteries are -- lithium-ion batteries are much further ahead, and I -- are the clear and established technology for the electrification of mobility in the passenger and sort of light vehicle space.

是的，喬許。我認為正確的思考方式肯定是大多數人將燃料電池視為能源轉型的一部分，並且美國和歐洲各地都有相當多的投資，儘管現在還處於早期階段，建設「氫中心」。因此，我認為氫將在整體長期轉型中佔有一席之地。當然，電池——鋰離子電池遙遙領先，而且我——是客運和輕型車輛領域移動電氣化的明確且成熟的技術。

But as people look forward to alternative fuels and energy to drive long-haul trucking, for example, the view is that hydrogen is probably a better fit there. I think the weight of batteries certainly would be more challenging in that space. So people tend to view hydrogen fitting well in that space.

但例如，當人們期待替代燃料和能源來驅動長途卡車運輸時，人們認為氫可能更適合那裡。我認為電池的重量在這個領域肯定會更具挑戰性。因此人們傾向於認為氫很適合這個空間。

So -- but there are a number of factors that have to get built out. I mean these hydrogen hubs have to get built out and infrastructure for refueling has to happen. So it's definitely a longer term, but one that I think is pretty clear will be part of the mix. And so as that is developing here, we continue to be recognized as an innovation leader in this space and partnered with some established players in the fuel cell space.

所以——但是有很多因素必須排除。我的意思是，必須建造這些氫中心，並且必須建立加油基礎設施。所以這絕對是一個較長的期限，但我認為非常明確的一個期限將成為其中的一部分。隨著這一領域的發展，我們繼續被公認為該領域的創新領導者，並與燃料電池領域的一些老牌企業合作。

And so our work will be with our partners jointly developing a carbon support for the catalyst in this fuel cell application. So something that I think is quite important for the long term. And I think the award of the research and development grant I think, is reflective of our position as an innovation leader in this space.

因此，我們的工作將是與我們的合作夥伴共同開發用於燃料電池應用中催化劑的碳載體。所以我認為從長遠來看非常重要。我認為獲得研發資助反映了我們作為該領域創新領導者的地位。

One moment for our next question and it comes from the line of Jeff Zekauskas with JPMorgan.

我們的下一個問題請稍等一下，它來自摩根大通的傑夫·澤考斯卡斯 (Jeff Zekauskas)。

I think your American Carbon Black volumes have decreased year-on-year for 6 quarters in a row, I think and you were down 8% in the March quarter, but you have a positive pricing dynamic in North America. Can you explain what's going on in that region?

我認為你們的美國炭黑銷量連續 6 個季度同比下降，我認為你們在 3 月份的季度下降了 8%，但你們在北美的定價動態積極。您能解釋一下該地區正在發生什麼嗎？

Yes, sure, Jeff. So the decline in the Americas, which is what you see. So that's both North and South America was largely driven by the impact of economic conditions in South America as well as the replacement tire imports from China, particularly in South America, where that has been impacted more to a lesser extent in North America. So I think the decline in volumes in the Americas region that we reported is definitely skewed towards South America and, again, given the economic conditions there, as we -- as well as the tire imports that impact that region. As we look forward, we are expecting that we'll see stronger volumes in the second half of the year such that full year volumes for the Americas, I think, will be more consistent with market expectations for the year.

是的，當然，傑夫。所以美洲的衰落，正如你所看到的。因此，北美和南美的成長很大程度上是受到南美經濟狀況以及從中國進口的替換輪胎的影響，特別是在南美，北美受到的影響更大，程度較小。因此，我認為我們報告的美洲地區銷量下降肯定偏向南美洲，而且考慮到那裡的經濟狀況以及影響該地區的輪胎進口。展望未來，我們預計今年下半年的銷售將更加強勁，因此我認為美洲的全年銷售將與今年的市場預期更加一致。

If we look at what forecasters like LNC would say. And then with respect to Europe, we saw volumes up 4% driven by higher contractual volumes as customers in the region continue to value local supply. But hopefully, that gives you a sense for the picture in the Americas region.

如果我們看看 LNC 等預測者會怎麼說。然後就歐洲而言，由於該地區的客戶繼續重視本地供應，因此在合約增加的推動下，銷量增加了 4%。但希望這能讓您了解美洲地區的情況。

Right. So for my follow-up, if you can say how much you grew in North America last year and in the first half, that would be good. But in terms of your cost of goods sold. Your cost of goods sold is down about $50 million in the quarter. And for the half, it's down about $100 million and your revenues are flat. Can you explain why the cost of goods sold -- what's the dynamic that's pulling down the cost of goods sold? And maybe if someone could comment on what the energy penalty has been in that you're not getting co-product credits. What was that penalty last year? And what's been the penalty so far this year?

正確的。所以對於我的後續，如果你能說出去年和上半年你在北美的成長是多少，那就太好了。但就您的銷售商品成本而言。本季您的銷售成本下降了約 5000 萬美元。上半年，它減少了約 1 億美元，而您的收入則持平。您能解釋為什麼銷售成本會下降嗎？也許有人可以評論一下你沒有獲得聯產品積分所帶來的能源損失。去年的處罰是什麼？今年到目前為止，處罰是多少？

Sure, Jeff. So the cost of goods sold decline is really because of lower raw material costs. And I think as you know, through our pricing mechanisms, we pass that through in the revenue line. So the reason you see cost of goods sold going down is because the raw materials are down. We pass that through in the revenue, but we also have price increases in the revenue and higher volumes in the revenue. So they're offsetting what the pass-through amount. So that's why the revenue looks a bit more flat. And that's the driver of why then the EBIT is higher because you're seeing the pricing come through and drop to that the EBIT line. Does that help?

當然，傑夫。因此，銷售成本下降實際上是因為原材料成本下降。我認為如您所知，透過我們的定價機制，我們將其納入收入線。因此，您看到銷售成本下降的原因是原材料下降。我們透過收入來傳遞這一點，但我們也有收入的價格上漲和收入的增加。所以他們正在抵銷轉嫁金額。這就是為什麼收入看起來更加持平的原因。這就是為什麼息稅前利潤更高的驅動因素，因為你會看到定價下降到息稅前利潤線。這樣有幫助嗎？

Yes. And what about the energy co-product credits (inaudible)?

是的。能源副產品積分又如何（聽不清楚）？

Yes. So the energy was a big headwind, I would say, last year from. If you looked at fiscal '22 to fiscal '23, it was roughly $20 million. And so that was the downward pressure. This year, I'd say we're not seeing any meaningful difference in terms of that. Again, there's very different contracts in different parts of the world. And in some cases, we sell electricity, some cases, steam, et cetera. So it doesn't always mirror exactly the energy markets. But this year, I'd say it's a minimal impact year-over-year to us.

是的。所以我想說，從去年開始，能源就是一個很大的逆風。如果你看一下 22 財年到 23 財年，大約是 2000 萬美元。這就是下行壓力。今年，我想說我們在這方面沒有看到任何有意義的差異。同樣，世界不同地區的合約也有很大不同。在某些情況下，我們出售電力，在某些情況下，我們出售蒸汽，等等。因此它並不總是準確反映能源市場。但今年，我想說這對我們來說影響很小。

Okay. And did you say what your North American volume growth has been last year and this year so far?

好的。您是否說過去年和今年迄今為止您在北美的銷售成長情況是多少？

Well, last year, North America was down. If you remember, we had a good amount of destocking happening in the region. So in 2022, you'll remember there are a good amount of supply chain disruptions happening, and so volumes were quite strong in '22, and we saw the destocking happening there last year. I'd say this year, as Sean noted, our expectation would be more of a flattish year in North America.

嗯，去年，北美市場表現不佳。如果你還記得的話，我們在該地區進行了大量的去庫存工作。因此，到 2022 年，您會記得發生了大量供應鏈中斷，因此 22 年的銷售相當強勁，我們去年看到了去庫存的情況。我想說，正如肖恩指出的那樣，我們預計今年北美將是平淡的一年。

Is the North American market growing and your seeding share or the North American market is flat?

北美市場正在成長而您的播種份額還是北美市場持平？

No, I think the outlook for this year is roughly flat, North America market.

不，我認為今年北美市場的前景大致持平。

(Operator Instructions) One moment for our next question. And it comes from the line of Laurence with Jefferies.

（操作員說明）請稍等一下我們的下一個問題。它來自勞倫斯和杰弗里斯的血統。

This is Dan is on for Laurence. You mentioned that infrastructure is a tailwind now. I was wondering if you're seeing any benefit from the Infrastructure Act or the chips Act, if that's helping drive growth if that will help you in the future? Or is that something any effect at all?

這是丹為勞倫斯上場。您提到基礎設施現在是一個順風車。我想知道您是否看到《基礎設施法案》或《晶片法案》有任何好處，這是否有助於推動成長，是否對您未來有幫助？或者說這有什麼影響嗎？

Dan, so I think, yes, we are seeing impact from improvements in infrastructure, again, principally in the wire and cable space which really, if you think about what drives that, there are really 2 things. One is, as governments and municipalities, renew their grid infrastructure, which is in need of renewal. That's one driver.

丹，所以我認為，是的，我們再次看到了基礎設施改進的影響，主要是在電線和電纜領域，如果你考慮一下是什麼推動了這一點，實際上有兩件事。一是政府和市政當局需要更新其電網基礎設施。那是一名司機。

And then as alternative energy gets installed, then that has to get connected to the grid. So the best example of that would be when there's an offshore wind farm then there have to be subsea cables that bring that power back and connect it to the grid. And so that drives demand for conductive carbons and so there's a clear trend there. With respect to -- and we're seeing that in the current results.

然後，隨著替代能源的安裝，必須將其連接到電網。因此，最好的例子是，當有離岸風電場時，必須有海底電纜將電力帶回並將其連接到電網。這推動了對導電碳的需求，因此有明顯的趨勢。關於——我們在當前的結果中看到了這一點。

With respect to the -- in the U.S., the infrastructure bill and CHIPS Act and range of different stimulus measures there. We're not yet seeing, I don't think any direct impact from that. In most cases, while there have been awards of grant money and incentives that are beginning to trickle the amount of impact from that, I don't think is meaningful.

關於美國的基礎設施法案和 CHIPS 法案以及一系列不同的刺激措施。我們還沒有看到，我認為這不會產生任何直接影響。在大多數情況下，雖然已經頒發了贈款和激勵措施，並開始產生一定的影響，但我認為沒有意義。

Now what should happen over the longer term here is as those investments take hold to shift the energy mix in the U.S. to more and more renewables, then you should certainly see an impact flowing through our infrastructure applications like wire and cable. And then over time, I think you should continue to see a sustained renewal of the grid. I mean, certainly, they're very well publicized examples of where the grid has not been stable in parts of the U.S., and this is true in many of the mature economies and really in need of renewal. So we think that provides a good long-term tailwind with a bump to that long-term tailwind as alternative energy gets deployed.

現在，從長遠來看，隨著這些投資將美國的能源結構轉向越來越多的可再生能源，那麼您肯定會看到我們的電線和電纜等基礎設施應用產生的影響。然後隨著時間的推移，我認為你應該會繼續看到電網的持續更新。我的意思是，當然，它們是美國部分地區電網不穩定的廣為人知的例子，這在許多成熟經濟體中都是如此，確實需要更新。因此，我們認為這提供了良好的長期順風，並且隨著替代能源的部署，這種長期順風將得到加強。

That's very helpful. And then my second question is around the new -- the kind of the battery business for EVs. I was just wondering, given the growth rate how long -- I mean what's your capacity? And is there a time in at least in the medium term, where you think you might have to build out capacity to meet the anticipated growth over the next 10 to 15 years or whatever it is.

這非常有幫助。我的第二個問題是關於新的電動車電池業務。我只是想知道，考慮到成長率要持續多久——我的意思是你的能力是多少？至少在中期，您是否認為可能需要建立產能以滿足未來 10 到 15 年或其他任何時間的預期成長。

Yes. Yes, sure. Thanks, Dan. So certainly, right now, in batteries, what you're seeing is that the EV demand continues to grow at a pretty healthy clip. I think globally, it's still somewhere this year expected to be in the 25% to 30% range. Now most of that coming in China. I think the growth of EVs next picking up in Europe with kind of lagging in the U.S. in the early stages. But what you're seeing this year is that at the battery production level that you're seeing battery production lag EV sales, and this is because there's -- this is quite well reported.

是的。是的，當然。謝謝，丹。當然，目前在電池方面，您看到的是電動車的需求繼續以相當健康的速度成長。我認為從全球範圍來看，今年預計仍處於 25% 至 30% 的範圍內。現在大部分都來自中國。我認為電動車的成長接下來將在歐洲加速，而美國在早期階段將會有所落後。但今年你看到的是，在電池生產水平上，你會看到電池生產落後於電動車銷售，這是因為——這是有很好的報導的。

There's quite a bit of inventory, battery cell inventory in the chain. And until that's worked off I think you will see battery production will lag EV growth. So probably the balance of this year, you'll probably see that dynamic play out.

供應鏈上有相當多的庫存，電池庫存。在這個問題解決之前，我認為你會看到電池產量將落後於電動車的成長。因此，今年餘下的時間裡，您可能會看到這種動態的發揮。

As we look longer term in this business today, the business is heavily skewed globally, not just our business, but the battery business in general to China, they make approximately 70% to 75% of the world's battery. So the overwhelming majority of them. Now over time, by the end of this decade, the expectation is that that will be more 50-50, 50% in China and about half coming outside of China and the U.S. and Europe. And so we'll certainly be making investments to support our customers' growth as that sort of bifurcation happens between China and rest of world.

從長遠來看，今天的業務在全球範圍內嚴重傾斜，不僅是我們的業務，而且整個電池業務都集中在中國，中國生產的電池約佔全球電池的 70% 至 75%。所以他們中的絕大多數。現在，隨著時間的推移，到本十年末，預計這一數字將超過 50-50，其中 50% 在中國，大約一半來自中國、美國和歐洲以外的地區。因此，隨著中國與世界其他地區之間發生這種分歧，我們肯定會進行投資來支持客戶的成長。

but we're really pacing the investments to make sure that they're synced up with the build-out of battery plants in the U.S. and Europe. So we're watching that closely and managing closely with our customers to make sure we're pacing those and sinking those up. But that's a bit of sort of big picture what's happening, how we see things developing and then over time, we would expect further capacity investments in the U.S. and Europe to support that.

但我們確實正在調整投資節奏，以確保它們與美國和歐洲電池工廠的建設同步。因此，我們正在密切關注這一情況，並與我們的客戶密切管理，以確保我們能夠調整節奏並解決這些問題。但這是正在發生的事情的大局，我們如何看待事情的發展，然後隨著時間的推移，我們預計美國和歐洲的進一步產能投資將支持這一點。

One moment for our next question and it comes from Jeff Zekauskas with JPMorgan.

我們的下一個問題是由傑夫·澤考斯卡斯 (Jeff Zekauskas) 和摩根大通 (JPMorgan) 提出的。

You've had a positive price dynamic in North America in fiscal '23. And I think you're optimistic about fiscal '24, but volumes contracted last year in North America, and it seems like they'll be flat or so this year. What makes you optimistic about your pricing dynamic and what in general was causing prices to lift in such a soft demand environment?

23 財年北美的價格動態呈現正面趨勢。我認為您對 24 財年持樂觀態度，但去年北美的銷量有所收縮，今年似乎將持平左右。是什麼讓您對定價動態持樂觀態度？

Yes, I think a couple of things here. If you look back over a long period of time here probably from 2015-ish time period up through this year. What you have seen in the U.S. is 2 factors. One, an increasingly tightening supply-demand balance, and that structural change remains in place as well as a significant requirement for environmental investments into the plants, which require pricing and returns on capital in order to get an appropriate return on that and to supply our customers.

是的，我想這裡有幾件事。如果你回顧很長一段時間，可能是從 2015 年左右一直到今年。你在美國看到的有兩個因素。一是供需平衡日益收緊，結構性變化仍然存在，對工廠的環境投資提出了重大要求，這需要定價和資本回報，以便獲得適當的回報並供應我們的產品。

And of course, the tightening balance over that long period of time has been because there have been tire plant expansions in the U.S. as well as competitor closures over that period of time that have brought the supply-demand balance into a tight position. So that structural dynamic has played out over many years.

當然，這麼長一段時間內的收緊平衡是因為美國輪胎工廠的擴張以及競爭對手的關閉，導致供需平衡陷入緊張狀態。因此，這種結構性動態已經持續多年。

In the current near term here, there's a certain I would call it, sort of dynamic nature in the demand, as Erica pointed out, because you saw '22 was very, very strong, '21 and '22. And then in '23, I think people realized that there was a bit of overbuild of inventory in '22 that got trimmed off in '23. So you really have to look through those 2 years and kind of average those out. And when you do that, you see that the dynamic is actually quite snug from a supply-demand standpoint.

在目前的短期內，我會稱之為某種需求的動態性質，正如埃麗卡指出的那樣，因為你看到'22非常非常強勁，'21和'22。然後在 23 年，我認為人們意識到 22 年庫存有點太多，但在 23 年被削減了。所以你真的必須回顧一下這兩年，然後對它們進行平均。當你這樣做時，你會發現從供需的角度來看，這種動態其實相當舒適。

So that's the long-term picture that we've been sharing for quite some time now. And I would say there's no change in that, but you've got to certainly look through the inventory build and then the destock across '22 and '23 to see the real supply/demand balance.

這就是我們一段時間以來一直在分享的長期前景。我想說這方面沒有變化，但你必須仔細查看庫存建設情況，然後查看 22 年和 23 年期間的去庫存情況，以了解真正的供需平衡。

And as I see no further questions in the queue, I will conclude the Q&A session and hand it back to Sean Keohane for final remarks.

由於我在隊列中沒有看到更多問題，我將結束問答環節並將其交還給 Sean Keohane 進行最後評論。

Great. Thank you very much for joining us today on the call and for your continued support of Cabot, and we look forward to speaking again next quarter. Have a great day.

偉大的。非常感謝您今天加入我們的電話會議以及您對卡博特的持續支持，我們期待下個季度再次發言。祝你有美好的一天。

And thank you all for participating, and you may now disconnect.

感謝大家的參與，現在您可以斷開連線了。