Thank you, operator and welcome, everyone. Thank you for joining us. My name is Tobias Bjorklund, and I'm the Head of Investor Relations at Novozymes. At this call, Ester Baiget, CEO of Novozymes, and Lars Green, our CFO will go through our performance for the first nine months of 2020, the outlook for the full year and comment on the recent changes to our organizational setup. We expect the presentation to take roughly 20 minutes after which we will open up for questions. Also with us today, we have the rest of the management team, namely, Anders Lund, EVP Consumer Biosolutions; Tina Fanø, EVP Industrial Biosolutions; Thomas Videbaek, Interim EVP of Strategy and Business Transformation as well as People Sustainability and Brand; Claus Fuglsang, Chief Science Officer and Graziela Malucelli, Chief of Operations. We expect the entire call to take 50 minutes. Before we begin, I would like to remind you that the information presented at the call is unaudited and the management may make forward-looking statements. These statements are based on current expectations and beliefs, and involve risks and uncertainties that could cause actual results to differ materially from those described in any forward-looking statements. With this, I will now hand you over to our Ester Baiget. Ester, please?

Thank you, Tobias. And thank you all for calling in. Please turn to Slide #2. Before we dive into our performance, I'd like to take this opportunity to share our thoughts on the organization setup we announced on September 1st. The new setup has a clear link to our strategy, better business with biology. The strategy provides a solid foundation and the recent changes allow us to further drive Novozymes ahead more forcefully. It enables us to center ourselves around our customers even more. We have created two divisions following the simple logic of where Novozymes solution fit in the value chain. In Consumer Biosolutions, we gather the segments that have a direct end consumer impact and in Agricultural and Industrial Biosolutions, we have group areas with focus on yield and process optimization. With Novozymes' strong foundation and commitment to innovation and production, these two important areas are now represented by dedicated Executive Vice Presidents who report to me. I'll let Claus and Graziela introduce themselves in a minute. Apart from these new roles, we're also well into the process of hiring two new executive positions currently headed up by Thomas Videbaek. And now I'll hand over to our CSO, Claus and before we hear from our COO, Graziela. Claus, please?

Thank you, Esther, and good morning, everyone. My name is Claus Fuglsang. I'm heading up Research & Development. I've been working with research in enzymes and microbes in my entire professional life and have been part of Novozymes since 1993. I know the potential of biological solutions and I'm really excited to be part of a world class R&D organization that helps to unfold this potential every day. I'm committed to ensuring more and a much closer involvement of commercial people and business development in our beta translation of consumer needs or customer needs to drive the pipeline for success and growth, while still allowing our passion for world class science and sustainability to shine through. And now I'll hand over to Graziela. Graziela, please?

Thank you, Claus, and hello to all of you. My name is Graziela Malucelli, and I'm Heading Operations, Supply and Quality. I have been with Novozymes since 1998 and I'm very excited to now represent Novozymes' global supply chain in our Executive Leadership Team. My area serves as at the home for these activities from suppliers through production all the way to our customers. We ensure a safe work environment, deliver the highest quality and secure continuous productivity improvements, all in the effort to be the best and most reliable supplier of biological solutions of our customers. With this, I'll hand back to you, Esther.

Thank you, Claus and Graziela. The new setup is a continuation of our path to deliver a stronger performance. We're taking the next steps to direct organization towards a simpler and more responsive setup. I am truly excited about where we're heading as a company, and the impact we can have, we will have on our customers, consumers and the world we live in. And let's now turn to the nine months performance. Organic sales grew 1% in the nine-month period, and declined by 3% in the third quarter. COVID-19 has impacted our sales in different ways, depending on the end-market exposure. Household Care and Food & Beverages were positively impacted by COVID-19 effects in the first half of the year, as end consumers changed habits. And we also saw a stockpiling in the value chain. As expected, we saw destocking in these two segments in the third quarter, in which we also had tougher comparisons from last year. For both the Bioenergy and Technical & Pharma segments, we have seen negative COVID-19 effects, as ethanol and textile production has declined. On a positive note, however, the headwinds is somehow in the third quarter. Sales in Agriculture & Feed grew moderately in the first nine months despite the significant third quarter decline in Feed. Our earnings and cash flows are solid despite the modest organic top line growth, and the EBIT margin came in at 27% for the first nine months and at 26.1% in the third quarter. The free cash flow before acquisitions was strong at DKK 2.7 billion. Please turn into Slide #3, for a review of our geographical performance. Emerging markets grew by 3% in the first nine months, while developed markets were flat. Sales in Europe, Middle East and Africa region, as well as Latin America, grew mainly driven by Household Care. Asia and Pacific declined primarily due to textile. North America was significantly impacted by weakness in the U.S. ethanol market. In the third quarter, emerging and developed markets declined by 6% and 2%, respectively. Developed markets were negatively impacted by destocking, inventory adjustments in Feed and declining U.S. ethanol production. In emerging markets, we saw a negative impact from destocking, declining textile production as well as inventory adjustments in the feed business. Could you please turn into Slide #4? Sales in Household Care grew by 7% organically in the first nine months of 2020. In the third quarter, we saw a slight organic decline of 1% following our unexpected destocking and as well a tougher comparison. The rollout of the Freshness platform continued to develop according to plan, and demand for better performing products in emerging markets continues to drive higher enzyme inclusion. On the innovation front, we recently launched Microvia, which is a first step solution into the area of using beneficial bacteria to provide superior and continuous deep cleaning on hard surfaces. Looking at the remaining of the year, the Freshness platform is expected to continue to be an important growth driver for Household Care. The novel freshness technology is currently being rolled out in Europe across multiple formats. We face a tougher comparison also in the fourth quarter and expect the COVID-19 related destocking to continue. However, these developments are difficult to predict, and depends on the impact of potentially reinforced COVID-19 restrictions. Please turn into Slide #5. Food & Beverages sales, grew by 5% organically, in the first nine months of the year. The performance was led by a strong growth in baking. Our sales was supported but more at-home consumption due to COVID-19. On the other hand, enzymes for beverages, especially for brewing were impacted negatively by lower demand due to social distancing. In the third quarter, sales grew modestly at 1%, partially due to a more difficult comparison in the third quarter, relative to the first half. Starch performed well in the quarter mainly due to timing, but this was to a large extent offset by destocking in baking and a continued COVID-19 related decline in beverages. In the fourth quarter we expect continued destocking. However, this development is also uncertain and it depends on the impact of potentially reinforced COVID-19 restrictions. Please turn into Slide 6. Bioenergy sales for the first nine months declined, by 11%, and 5%, in the third quarter. While sales outside the U.S. grew, sales in the U.S. were severely impacted by lower ethanol production following COVID-19 induced stay-at-home restrictions. The ethanol production as well as our sales in the U.S. started to improve towards the end of the second quarter from the lows in April and May. Production rates in the first nine months are indicated to be down by around 15% compared to last year, according to the U.S. Energy Information Administration. In the third quarter, we introduced the Fiberex platform, which improves the conversion of corn into ethanol and other high value products. And looking ahead, we continue to adapt and tailor our offerings to individual plants and market conditions. And we are conscious about the prevailing uncertainty in the U.S. ethanol market. Please turn into Slide #7. Sales in Agriculture & Feed grew 4% organically in the first nine months, but declined by 19% in the third quarter. Agriculture delivered healthy growth in the first nine months, driven by solid demand for upstream corn inoculants, overcoming the drop in sales of downstream solutions. Following a positive performance in the first half of the year, including a DKK 60 million positive one-off in the second quarter, we saw a decline in the third quarter, mainly due to timing and sales to the feed industry declining in the nine months period. Following the growth in the first half of the year, the feed business declined in the third quarter due to inventory adjustments as a response to lower market demand. We had expected inventory adjustments but they were larger than anticipated. For the rest of the year, we're still operating in an environment where the global farm economics and COVID-19 impacts remain sources of uncertainty. Organic sales in Technical & Pharma declined by 15% in the first nine months, mainly due to the negative impact of COVID-19, causing a decline in textile production. Sales in the third quarter grew by 2% as the pressure on textile eased and we also saw supported growth on the Pharma business. And with this, I will now hand over to our CFO, Lars, who will take with you through the financials.

Thank you, Esther. Please turn to Slide 8. As highlighted by Esther, organic sales declined by 3% in the third quarter, but grew by 1% for the first nine months. In Danish kroner, sales declined by 7% in the quarter and by 1% for the first nine months period. Currencies, especially the U.S. dollar, were a drag on our reported Danish kroner numbers, whereas the acquisition of PrecisionBiotics Group in June, had a slight positive effects in the third quarter. Earnings and cash flow performance for the first nine months and the third quarter was solid despite challenging market conditions, a negative currency environment and the recent acquisition, having a dilutive effect on our EBIT margin. The gross margin ended at 56.2% for the first nine months and 56.1% for the third quarter. This was an increase of one and 0.7 percentage points, respectively compared to the same periods of last year. The gross margin development was supported by productivity improvements, lower input costs and one-offs. The gross margin was positively impacted by a BioAg one-off in the second quarter, and in the third quarter negatively impacted by severance costs related to the recent organizational changes. The total severance costs of around DKK 90 million were distributed roughly evenly in COGS, R&D, and sales and distribution. The reported EBIT margin for the first nine months was 27% or 60 basis points lower than for the same period of last year. Both this and last year's EBIT margins were impacted by one-offs. In 2019, the margin was positively affected by the termination of the former BioAg Alliance and the divestment of a Pharma related royalty in the second quarter. In addition, the EBIT margin in the third quarter of 2019 was impacted by restructuring costs following the updated strategy. In 2020, the EBIT margin was positively affected by a BioAg one-off in the second quarter, and negatively affected by severance cost in the third quarter. Also, currencies were slightly dilutive to margins. In summary, the EBIT margin, excluding one-offs was roughly one percentage points higher, for the first nine months of 2020, than for the same period of last year. The reported EBIT margin in the third quarter of 2020 increased by slightly more than three percentage points relative to last year to 26.1%. If adjusted for the previously mentioned one-offs in the third quarter last year, and this year, the underlying EBIT margin was down by roughly one percentage point to around 29%. The return on invested capital, including goodwill declined by roughly one percentage point due to higher average invested capital and a lower net operating profit after tax. Net investments excluding acquisitions were close to DKK 600 million in the first nine months of 2020 and this was roughly on par with the same period of 2019. The free cash flow before acquisitions for the nine-month period was DKK 2,716 million. This was DKK 665 million more than for the same period of 2019. The improvement was driven by stronger cash conversion from better earnings quality, as well as the postponed Danish tax payment following the Danish government's COVID-19 related support. In the third quarter, cash flow was DKK 665 million. This was roughly DKK 170 million less than in the third quarter of last year and can be explained by higher investments and lower payables as the third quarter last year included a provision for severance cost related to the reorganization. Please turn to Slide 9, for the 2020 outlook. We continue to see unusually high COVID-19 related uncertainty prevailing in the marketplace and consequently, maintain the full year 2020 organic sales outlook of minus 2% to plus 2%. With increasing confidence, we consider the midpoint of the range the most likely scenario. The upper and lower ends of the overall organic sales growth range of plus 2% and minus. 2%, respectively, mainly depends on the magnitude of destocking and at-home consumption in Household Care and Food & Beverages as well as potential changes to the current trajectory of textile and U.S. ethanol production, affecting Bioenergy and Technical & Pharma. On a segment level, Household Care and Food & Beverages are expected to deliver mid-single digit organic growth. Agriculture & Feed, low single digit organic growth while Bioenergy and Technical & Pharma are expected to deliver double digit organic sales declines. We are raising the outlook on earnings and the EBIT margin is now expected at between 26% and 27%, up from previously around 26%. This is driven by diligent cost controls as well as lower travel and hiring costs, offsetting higher investments in digital capabilities. As a reference, the underlying EBIT margin in 2019 was around 26%. The outlook for ROIC including goodwill is maintained at between 18% to 19%. The outlook for free cash flow before acquisitions is also increased and now expected at between DKK 2.6 billion and DKK 3 billion is grown. This is the result of a stronger earnings outlook, as well as less negative impact on receivables from COVID-19 than previously expected. Turning to our balance sheet, we have a very solid position with a net debt-to-EBITDA leverage of 0.9 times, even with the recent acquisition, dividend payments and our stock buyback program. On that note, the 2020 stock buyback program totaling DKK 1.5 billion completed on August 24. Finally, I'd like to remind you that we will report sales for the full year based on the new structure anchored in the two divisions, Consumer Biosolutions, and Agriculture & Industrial Biosolution. We will continue to share sales details on five segments allowing for the same level of transparency as you had previously. We will provide you with five-year historical data on the new sales structure well ahead of year end. I'll now hand back to Ester for a wrap up before we open for questions. Ester, please?

Thank you, Lars. Please turn to Slide 10. Let me summarize our key messages today. Our performance in the first nine months was satisfactory, especially considering the implications of COVID-19. Our versatile portfolio and innovation agenda combined with organization's agility has allowed us to rapidly adapt to a changing environment. This, together with an increased customer focus, also in the innovation cycle sets the scene for stronger performance going forward. Looking at 2020, we continue to see considerable COVID-19 related uncertainty for the remainder of the year. Consequently, we maintain the outlook for organic sales at minus 2% to plus 2%, and are increasingly gaining confidence that the midpoint of the range is the most likely outcome. Following a solid performance, earnings performance, we raised our EBIT margin and free cash flow guidance. The results we achieved over the past nine months, have only been possible, thanks to our dedicated employees and their ability to maintain focus. I am grateful for their commitment. And I'm confident our more customer centric approach will increase our impact, not only for our customers and consumers, but also in the world we live in. With this, I would like to thank you all for attending our call this morning. And we're now ready to take your questions. Operator, please begin.

Thank you. [Operator Instructions] And our first question comes from the line of Gunther Zechmann of Bernstein. Please go ahead. Your line is now open.

Hi, good morning. Thanks for taking my questions. And can I start with Bioenergy please, for you, Tina? It's quite noticeable, the outperformance versus the market in Q3, with the market down 11% and you did minus 5% organic sales growth. I appreciate you have a slightly different customer mix from the overall market but can you give some color around what you see in the U.S. market versus export market versus international markets, please? I'll start with that.

Tina? Tina Fanø: Yeah. Hi, Gunther. It's right that our performance in Q3 of minus5% is more than what EIA has reported for the U.S. But as I'm - I know you also know and as you're so hinting to in your question, we have a more broad portfolio. I would say in the U.S., it's roughly in line with what we see there. However, what we have been doing over the - over the years is that we have built it, you could say, our presence more broadly. So outside the U.S., in particular in Latin America, we do see good growth. I also think it's a clear signal to us, you know that you can't take a direct read over from the EIA numbers to our performance also because we serve a different customer base and also because of that we have a more - a broad geographical spread. You also asked about exports. So right now in the U.S. there are limited exports. Brazil, in fact have had a - one of the reasons is Brazil has been one of the key export markets. But here mid-September, in fact, Brazil extended with 90 days the no tariff quota, which is giving some hope for that more exports from the U.S. could happen. But overall, there are limited exports these days from the U.S. to other parts. I think that covered all your questions. Right, Gunther?

Great, Tina, thank you very much. And if I'm allowed a second question, can I just ask if what --- what your view Ester is on based on a capital allocation? You mentioned several times that this is one of the most important parts of your job and you recently announced the acquisition of PrecisionBiotics. And so would there be any scenario where more new share buyback program or how do you think about the balance between shareholder returns and acquisitions, please?

We're committed to our announcements and to the investments to the share buyback program under the shareholder dividends. That's a space that we're staying firm and committed to. At the same time, what we are reinforcing as a team, it is the capital allocation, the cash allocation on where we're better allocating those resources to [strength] our capability to continue or to become the growth company that we deserve. And that means that yes, acquisitions are an alternative. It's a constant question that we make ourselves in the leadership team on what is the best resource of the cash to give the return and to translate, yes, this society needs this opportunity into bio-based solutions. We have a fantastic innovation machine, we have an incredible production capability and we're committed to continue to invest on them. But we also have the responsibility on, are there other options in the in the space that would be complimentary and bringing a stronger push or complimentary fit to accelerate growth to the facilities and the capabilities that we have.

Thank you, Ester. Thank you, Tina.

Thank you. Our next question comes from the line of Søren Samsøe of SEB. Please go ahead. Your line is now open. Søren Samsøe: Thank you. First, a question on your costs, where you said, last year you were you let go of 300 people which you said you would rehire. If you could quantify how many you have rehired in Q3 and also how many you have rehired in the first nine months? That's the first question. Then on your growth in Ag & Feed, it's down 19%. Given that Ag is a small part of the division today, then Ag must be down on the 50% or something. Can you confirm that? And then finally, if you could talk a little bit about your product launches, for example, the Fiberex looks quite interesting, if you could talk a little bit about that? Thank you.

Thanks Soren. I'll take the first question on the cost element. And so as you rightly point out, we are committed to - to reinvest the resources we released last year in supporting the future growth of the business. And as we also have been speaking about during the year, it has been more difficult to do so in the way that we had foreseen at the beginning of the year. And therefore we have - we have not hired as many people this year as we had expected. And we have also had less spending on accounts such as travel and entertainment. But on the other hand, we have reallocated some of that resource to accelerate some of the digital platforms that we are now using to also communicate and interact with our customers. So I think it is - it is a question that is broader than just talking about how many people we are. We have during the year, recruited people. So we are more people now than we were at the beginning of the year. But I think it is more relevant to look at the total cost levels. And there we have - we have not yet put in place, you could say or invested all of the money we released last year. We will, at any point in time and also looking forward, consider how do we best support the future growth of the business and we will also do that as we put in place our plans for the coming period. Tina Fanø: And on - Søren Samsøe: So does that also mean then that - it sounds a little a bit like, you say that you are now going away from the statement that you'll rehire the 300 people? Does that mean that we can expect the cost levels to be lower going forward?

So I don't think we have said that we would hire 300 people. I think we have said that we would reinvest the DKK 300 million that we released last year. And we're still committed to do that. But my - so my comments should rather be seen in the light of, we would at any point in time, make sure that we reinvest those money in the most sensible way. At the beginning of the year, we were looking more at hiring people. We have now learned that digital solutions is also an alternative. So we would find the most appropriate mix for how we invest our resources to have the highest impact on our future growth. Tina Fanø: And so and then over to your questions, first Ag & Feed and then on Fiberex. So on Ag & Feed, and you're right, in Q3, we're down a minus 19%. And most of that is in fact, coming from Feed. But please bear in mind that this is a one of our volatile segments. In BioAg, it's mostly due to timing. But if you look at the nine-month performance, we are up 4%, which in fact, is BioAg driven. If I dive into the Feed component of this, then there has been a misalignment between what we have seen as in-market performance, and then our sales in the first half. And that's also while we have flagged it a number of times before. And here in Q3, we saw these inventory adjustments, it is more than anticipated. We are working with DSM how to - how to do that better. There is a long-term growth in the market and we should get our share of that. If you deep dive into the feed element of our business, then we do see good demand for our new launches for our Balancius, particularly. But it is part of the reason why we have lowered from the mid-single digit performance to the low single digit. I think one of the reasons we also looking at is that they - one of the things we're looking into together with our partners is that it seems like the more consumption at-home is also leading to less - in some less meat consumption. But that's one of the things we are looking into. So that's on Ag & Feed, I hope that answers your question. And then on the Fiberex - Søren Samsøe: Yes, thanks. Tina Fanø: Then on the Fiberex, so it's - it's an extra tool in the toolbox that help producers to differentiate, especially in low carbon ethanol markets. So a - so it helps our producers differentiate and do good no matter what kind of conditions there are. So this is an extra tool to the toolbox to get extra yield out of your bushel of corn. Søren Samsøe: Okay. Thanks for the answers.

Thank you. Our next question comes from the line of Nicola Tang of Exane BNP Paribas. Please go ahead. Your line is now open. Q -: Thanks, everyone and hi there. And it's actually, my first one was a follow up to the last question. So it's for Tina on Ag & Feed. And can you just clarify, and it's more on the Ag side that you're downgrading the function to the full year outlook, is it really mainly associated with all the stuff you just said on Feed, rather than changing expectations on Ag for the full year? And could you just explain a little bit more about what you're saying about the timing of Ag, is that now more pushing to Q4? And then the second question was on the free cash flow guidance, and I noticed that the lower end of your guidance was below what you've achieved year-to-date. And so I was just wondering if you could give some color on the moving parts, as you go into Q4? Thank you.

Thanks, everyone and hi there. And it's actually, my first one was a follow up to the last question. So it's for Tina on Ag & Feed. And can you just clarify, and it's more on the Ag side that you're downgrading the function to the full year outlook, is it really mainly associated with all the stuff you just said on Feed, rather than changing expectations on Ag for the full year? And could you just explain a little bit more about what you're saying about the timing of Ag, is that now more pushing to Q4? And then the second question was on the free cash flow guidance, and I noticed that the lower end of your guidance was below what you've achieved year-to-date. And so I was just wondering if you could give some color on the moving parts, as you go into Q4? Thank you. Tina Fanø: So let me start with maybe a super short answer. Yes, it is. It is, the change is due to the downgrade on Feed. Ag is performing according to expectations, we see good uptick of our new solutions, the corn, the corn upstream inoculants as well as the biocontrol.

And on the cash flow, as you rightly point out, we have generated DKK 2.7 billion of cash flow in the first nine months. And so we are after the nine months within the range for our guidance of the full year. But as also I said in my comments, remember that part of that cash flow is generated because the Danish government has postponed some payment terms for withholding tax and VAT. And we expect that to return to normal levels in Q4. So you could say the underlying of level of cash flow is actually lower than what you see this year in the report numbers. So therefore, it is - there is actually a logic to it. And then I'll also remind you that the Q4 is typically a low cash flow quarter because we have very significant tax payments in Denmark in Q4. So - so the guidance for the full year is actually much in line with historic patterns of the cash flow over the year. Q -: Thank you.

Thank you.

Thank you. Our next question comes from the line of a Lars Topholm of Carnegie. Please go ahead. Your line is now open.

Thank you. Also two questions from me, actually follow-ups on some of the previous questions. So regarding the discussion of reinvesting DKK 300 million, just so I also understand and how much of the DKK 300 million have already been reinvested and what is the residual that you implicitly need to reinvest next year? And then on the cash flow, I mean, you still don't provide a quarterly cash flow, but if you did, your cash flow from operations would be down from DKK 1010 million to DKK 894 million and that means Q3 EBITDA to cash conversion fell from 94% in the first half of the year to just 74% in Q3? I wonder if you can explain what that is and what level of cash conversion, I should be looking at going forward and if it's different from the run rate of 74%. Can you please take me through what the moving parts will be? Thank you.

Thank you, Lars. So, when we talk about the reinvestments, then remember that already in the first quarter of last year, we started reinvesting. So, you could say the full year of last year started to include some of that reinvestment. You can say that some of the margin expansion that we have seen this year on the gross margin is, you could say underlying, is in line with what we have expected. But the challenge of course is that with a lower leverage on the top line, we have less margin expansion on the overall EBIT level. So therefore, that is what is driving you can say the primary EBIT margin down compared to the original guidance. And so - so on reinvesting we're still not fully there, because as I said before, we have not been able to invest in all the launches of - of new people in emerging markets. But on the other hand, we have reallocated some of that investment to digital campaigns and digital tools. So when so there are still some of it in front of us. It is becoming harder and harder, you can say, to separate the hot and cold water in terms of where do we see the savings and where do we invest. So I would just reiterate that we are committed to invest the money we released, and do that in the most - in the best possible way to support the future growth. On the cash, remember -

I understand that but as a ballpark figure Lars, how much do you still need to - I mean, have you 50% there or more than 50% there? I'm just trying to see what I should put into my model for margins next year, please.

Yeah. So I would say we have - we have reinvested more than half of the resources we released last year. So, that gives you an indication about the level. And as I said, we are committed to invest all that is needed, and the full amount as we move forward. But of course, want to do it where it makes sense and will at all times make our decisions about how can we best possible support the future growth. So on cash, I think you have to - in your analysis of Q3, you have to take a look at the gross profit levels. Because there you see the decline in gross profit of more than DKK 100 million, which actually corresponds to the reduction in cash flow. So in the earnings last year, there was a large provision that did not carry a cash component in the quarter. And therefore, when you see an increase in the EBIT this year, it does not - it doesn't reflect what would be the, you can say the corresponding potential for cash. So - so I would say that the ability of us to convert cash this year is as good as it was last year. And as you can see, in our guidance, we have not seen any impact on our ability to collect in 2020 that we had feared early on in the year. So therefore, we are raising our guidance for cash flow. Because we basically see a stronger ability to convert cash in 2020 than what we had feared a couple of months ago.

But Lars, I was asking to the cash conversion. So if your gross profit is lower so is your EBITDA, but if you still factor that, the 4% of that EBITDA is converted into operating cash flow. I assume that can't be explained by a decline in gross profit, so what explains it?

But in the EBITDA number from last year, there was a very large cost that was not generating cash in Q3. So when you compare quarter-to-quarter that provision has to be deducted. And that's actually why -

That isn't my question. My - you're not answering my question. My question is, first half this year the cash conversion is 94%. Q3 this year, cash conversion is 74%. What explains that decline? It's not related to where you are compared to last year.

So Lars, as we have also said before, when you look at cash flow, that is much more volatile quarter-by-quarter. And therefore, I think looking at the overall ability to convert cash; you have to look at that for longer periods of time. My message to you is that we have not seen a decline in our ability to convert cash in the third quarter. We are collecting cash from our receivables without any trouble. And we are seeing the - a level of cash conversion in our numbers for the first nine months that are in line with our past performance and actually better than what we forecasted a couple of months ago. So if you have follow-up questions on this, I will happily take them afterwards. So - so let's take a discussion after the call here so if we can sort out any details that may still be outstanding.

Okay. Thank you, Lars.

Thank you. Our next question comes from the line of Sebastian Bray of Berenberg Bank. Please go ahead. Your line is now open.

Good morning. Thank you for taking my questions. I would have two please, both margin related. The first is more of in principles question. The business has very tough comparable numbers moving into H1 2021. And I'm thinking on a full-year basis, what is the level of top line growth that Novozymes would need to generate to avoid any impacts related to negative operating leverage? In other words, through the cycle, what is the minimum level of top line growth, which we would not see EBIT margin erosion? That's the first question. And the second one is on the specifics of the margin bridge to 2021. Am I right in saying that the list of factors to take into account here are FX, severance costs? Are there any of those that go into 2021? And are there any other effects to be aware of that might change? And I'm thinking of corona related travel picking up here, but a summary would be helpful. Thank you.

Well, thank you for that, for those questions. Very tough ones, I have to say, because the world is living now through a very challenging year with impacts from corona. And obviously, we are also in the middle of that. And therefore it is really, really difficult to make predictions about the future. Which by the way, is also why we have maintained a very broad range at this point in time in our top line guidance compared to what we would do in a in a normal year. So I think I have to answer your question in a more general way, saying that, what will give us margin expansion is leverage on the top line. And we are still seeing the underlying fundamental drivers of - of top line growth as what we announced last year with a better business with biology. We have to see obviously, where the world is heading and what the conditions are. And so therefore, when we come with the concrete guidance for 2021, those factors and assumptions will be part of that guidance. But the margin expansion we see still coming from gross margin, we see the opportunity to continue to have productivity improvements, and leverage the scale from basically producing more units from the facilities we have and sharing the fixed costs on more units. And then when you talk, sort of the bridge and what do you need to remember going into '21. Foreign exchange obviously has an impact because we have sales distributed slightly different than our cost base. And so with a lower U.S. dollar, we will have a negative impact from the currencies on the margin like we have seen in the third quarter of this year. Severance cost of course is a one-off, and we saw that in the third quarter of this year. And then we also called out the one-off BioAg income in Q2 as something that is non-recurring and has a slight impact on the margin. So - so those are some of the factors you have to take into account. I think fundamentally, it's important for us to focus on how do we basically leverage the key value drivers of our business, focus on executing on better business with biology, and then come first or second of February; we will come back with a concrete guidance for 2021.

Understood. Thank you for taking my questions.

Thank you. Our next question comes from the line of Michael Novod of Nordea markets. Please go ahead. Your line is now open.

Yes, thanks a lot. I just have one follow up question and that's about Ag & Feed. So obviously, you are not having the same mix, of course at all, as Beta but still looking into 2021, how do you think around, so the Ag & Feed business, if we look broadly around that business for the last three, four years, it has not been impressive. There's been a lot of different one-offs but still, it's not been an impressive business development. And now we saw Beta take a massive impairment on 2021 due to challenging Ag market. So I was always just thinking around your thoughts on your overall business in this area going into 2021 in a market environment where generally economic conditions are not particularly favorable. Tina Fanø: Michael, it's, you're right that there has been some tough market conditions in the area. However, that doesn't necessarily mean that that's also what we see. Already, I would say through these relatively tough times, we have seen good penetration of our innovations. So the upstream corn, the Balancius, the whole health area in husbandry - in livestock husbandry, there is a lot of opportunities. So we still believe that this is an area which holds innovation potential and a business potential for Novozymes. It is an area where there is a huge value pools, where there is a significant need for sustainable solutions both on the Ag side and on the animal side. But it has to be driven by innovation and strong science-based performance, which helps drive growth.

So you think it is a growth area going forward? Or just that that innovation can just keep it flat to slightly declining? Tina Fanø: Yes.

Or is this a growth area going forward? Is it difficult to see - Tina Fanø: Yeah.

-- growth potential given your numbers in the past couple of years for Ag, and that this comment is still a viable comment? Tina Fanø: Yes.

One last question or two.

Thank you. Our next question comes from the line of Thomas Wrigglesworth of Citi. Please go ahead, your line is now open.

Thanks very much for the opportunity to ask questions. I was wondering if you could share with us what your expectations are for the consumer business? So, Household Care and Food & Beverage, in regards to how COVID wave two will play out versus COVID wave one? And what you are thinking - what the patterns look like from customers and how that may develop? My second question, kind of again, thinking about, is around the development. Well, we're now lapping Freshness' introduction into HPC. How should we think about Freshness growth going forward into 2021 and beyond? Thank you.

Yeah, so thanks for the question. I don't have a crystal ball on COVID. And I really think it's going to be a challenge both putting sort of our expectation together, because you can have an awful lot of different assumptions. But let me try with a few assumptions. If we continue with the second wave that is equal to the first one or even worse, I actually think that it will have a positive effect on the businesses that we have also seen in 2020. That means that we'll see elevated level of hygiene needs and cleaning, and laundry. We will probably also see more in-home consumption when it comes to Food & Beverages. So I think you'll see the same drivers, as you've seen in 2020. And then you can think of many different permutations of how a second wave can look. But I think the best guidance I have is that if it looks similar to what we've seen, we probably - we will also see the same effects. In terms of Freshness, we are on the plan as we've been throughout the last couple of years. We're seeing, as Ester also said, it's being rolled out in Europe. And we're actually seeing very positive development and momentum in the conversation with our development partners. And let me also remind you that we are planning for certain segments to come out with broad market technology in the middle of '21, which we also have expectations to - of course, there's a ramp up of broad market technology. So the effect of '21 may not be that substantial, but of course it's a - it's an expectation that longer term, also broad market freshness will be meaningful for Novozymes.

We have a couple more minutes for one last question.

Okay. Thank you, our final question comes from the line of Jonas Guldborg of Danske Bank. Please go ahead, your line is now open.

Yeah, good morning all. Just two questions and first of all, on the cash flow for Q4. Maybe Lars you could just try and give us the figure of how much delayed taxes and VAT is going to be released in Q4. And then a little bit of - if you could talk a little bit of the destocking in Food & Beverages, how it has impacted Q3 and how close are we to normalized inventories and how should we see Q4 relative to Q3 in that perspective? Thank you.

Yeah, so first on the cash flow. So the impact of the postponed payment term from the Danish government is roughly DKK 150 million or so. So that's the - that's the benefit we have seen the first nine months of the year.

And in terms of destocking in Food & Beverages, we've maintained the guidance on the overall segment, destocking is mainly related to baking but we are still committed to sort of mid-single digit growth for Food & Beverage here overall.

Thank you. And with this, I would like to thank you all for attending our call this morning and I'm looking forward to continue the conversations with many of you with the next four coming days.