Bystronic Aktie

Good morning, everybody. A warm welcome to our Bystronic full year results for 2025. I'm happy to welcome as well Heinz Baumgartner, our Chair, dear investors. We will go through the presentation. I have Javier Perez today here, our new CFO. He will maybe introduce himself later as well. So please take a minute to go through the disclaimer. I will read it in the same time and then continue in the expectation that you are as fast as me by reading it.

Perfect. So we will start with the business review. Javier will then take over for the financial review. We will do an outlook together, and we will take a little bit more time for the Q&A session.

Let me start with the business review. You have seen the numbers already this morning. I will elaborate a bit more later on the regions and so on. So we had an order intake of CHF 634.5 million, which is a 5% increase at constant exchange rate. We had, as expected, a little bit lower net sales compared to last year at constant exchange rate by 2.2%. I will elaborate on the reasons why and so on as well.

I think what was an achievement, of course, we are not happy with the numbers, but it was with an extremely improved EBIT, which is minus CHF 19.8 million compared to the CHF 84 million we had in the previous year. Adjusted EBIT without the one-offs was the CHF 47 million, which is in comparison to last year, a big improvement because we have even much less net sales.

The operating free cash flow was slightly higher than in 2024 despite the fact that we had the payments of the one-offs with severance payments. The cash out was this year, but we will elaborate on this one as well. So in overall, the numbers are in line with what we have expected.

Again, on the EBIT side, slightly higher on the net sales, slightly lower than we had expected. What is really positive in my eyes, it's the first time after a few years for not saying many years to have a positive book-to-bill ratio. So order intake is higher for 2025 than the net sales, which, of course, results as well in a higher backlog.

If we go to the quarterly view, you see that there is not a real recovery in the market. At least we have now over, I would say, 7 quarters a stabilization in order intake. The last quarter in 2025 was good. And with that, I'm coming to the regions, starting with Americas. We had a solid demand. We had a lot of headwinds, the whole tariff discussion. It was a hit for us, but due to our local production, we could mitigate some of the costs. Nevertheless, especially in net sales, we had a few weeks during the summer period, all the famous 1st of August when everything was announced.

We had some customer postponing. We even stopped some deliveries because it was very uncertain how to calculate and so on. This had a certain impact. But in terms of order intake, it was really stable. And I think we were even able to somehow pass some of the tariffs to the customers. Of course, what was sold and in delivery was a pain for us, and it cost us a hell of a money, and we will shortly elaborate this when we talk about EBIT as well.

Meanwhile, I can say when we made the presentation last week, there was a stabilization of the tariff discussions. So over the weekend, we have now a new development. Nobody can exactly say what it means. But in overall, for us, it will not have an additional negative impact and will not have an additional positive impact because whether it is the 10% or the 15%, adding the existing tariffs, we stay more or less in the same range.

In EMEA, we saw a slight recovery. We had very good performance in Italy and in Spain over the whole year. And we had a quite good development in the first -- in the last quarter, even in DACH. Germany and Switzerland were quite strong, but really pushed by smart factories. Now the definition of Smart Factory is wide, but I'm saying about larger systems, not single machine. So there is a strong trend towards automated system, less single machines. So exactly what our strategy pays in. And the last quarter was really strong, and they made it up for the -- let's say, for the full year.

China is quite stable. We see even a positive development at DNE. That's our second brand. As you know, we made a new repositioning of our DNE brand. We decoupled DNE completely from Bystronic with look and feel, different sales channels and so on. And we even relocated the whole company from Shenzhen to Foshan. So we have now a state-of-the-art factory where we could increase the efficiency of building machines. We are coming close to 1,000 machines building out of this factory, which is very, very positive. But even the Bystronic brand in China seems to stabilize, but even towards smart factories.

The weak point is definitively APAC without China. So Southeast Asia, especially South Korea is slow. It was slow over the full year. And we are right now investigating what to do in this region, which was a quite important region in the past for Bystronic.

So a little bit how we developed the order intake. I already mentioned a few times that we -- if you look at the numbers, you will recognize that we are doing less business in the single machines, so in the standard machines. So a big driver in order intake and growth is definitely driven by the smart factories. So larger projects, there is a really growth as a big demand and growing demand for smart factories. Our software solution pays in a lot. So I think we can make a differentiation with our overall system. As you know, we still have a lot of small customers. I don't want to call it mom-and-pop shops anymore because they have smart factories as well, where they like to have the full software solution we offer.

What is very strong, and this is a sign of recovery is bending. We cannot sell more bending because we don't have more capacity. So the request for bending solutions and even here for automated bending solution is extremely high. We will invest heavily even in this year in bending solution as a fully automated bending solutions. I already mentioned the DNE relaunch. I think I don't have to repeat it again. But here on the picture, you see the factory. It's a 50,000 square meter factory, one floor, located in Foshan and not anymore in the city center of Shenzhen. Of course, we have even a cost advantage, but the reason behind is really to build more efficiently machines and not having it divided over different floors.

A highlight of 2025 was definitively our Tube business. As you know, we established Tube as our own business unit in our organization. We put ahead of this business unit, and we really focused on the market. The Tube market for small tubes is not a sheet metal market. This is something we had to recognize. And of course, what was a big highlight in terms of order intake, but not in net sales was the large Tube machine, the 330, which I think is really breaking through and contributing a lot in terms of order intake. Why I'm saying in net sales, delivery times. I mean we can tell it, but you will not have the final acceptance within the year where we do the sales recognition. So that's something you see in the net sales as well and it's normal. I explained it before. If you have single machines, which you deliver within 3 to 6 weeks and you do an installation within 2 weeks, you will have the sales recognition very close to the order intake.

As more you go to systems, you will have a sales recognition just delayed, right? And that's something you see in the net sales. That's something you will see even in the coming quarters because there will be -- when you do a shift from single machines to systems, you will have a small down until it recovers and it stabilizes.

Okay. I think the organization -- the reorganization is nearly done. I mean there are always some minor adjustments to do. I think what makes me extremely happy is that we finally have the EC, the Executive Committee, finalized with Javier as CFO; with Alberto Martinez, having a huge experience in our sheet metal business, leading the division Systems; and with Wilfried de Backer, having somebody having a very long-standing experience in service business for the division Service.

I think we have now a very strong market focus. So we aligned our organization to the needs of the market. I think we are much leaner. You see it in the cost savings. So of course, we are now more agile, and we are able to do very fast decisions. We increased our efficiencies, bundled our competencies. We consolidated our group function. I think there, we still have some potential, but I think now together with Javier, we will tackle new topics as well. So in optimization of our production setup, we did a lot. I think there is still some room.

Innovation, as I told already last time, we integrated R&D into the divisions. So Tube, which is not a division part of the System division, but they have a dedicated R&D, which are very close to the market. We have R&D in our division System. And of course, we put a huge focus on automation solution. Well, meanwhile, the headquarter of the automation development is in Switzerland. So we finalized this move.

Expansion of Smart Factories, I think I don't have to repeat it.

Last point, opportunities. You know that I was very open during the last conferences. We had quality issues. We had reputation issues. Some of you might ask why Service is slightly lower. That's because we decided we want to move more towards the customer. Maybe we squeezed a little bit too much our Service business. And with that, we disappointed some customers. So -- and of course, the price pressure in the past led a little bit to a situation where we did not put the quality on the first priority. I think we are back now there. We see this even in terms of warranty costs and so on. Is there still possibility for improvement? Definitively, yes. And I mean, I mentioned it with the R&D market-oriented product portfolio.

And last but not least, the focus on Tube Laser cutting systems remains very important for us. I think it's last time I'm showing something about the restructuring. The EBIT we are showing was only possible because the restructuring went better than expected. When I'm saying this, it's not that in overall we are doing more, but it was more in effect already in 2025 than we anticipated. So we will have less of these savings in 2026. The target to achieve the CHF 60 million annualized savings, I think it's achieved. Unfortunately, it's a sad number. We reduced by 600 FTEs, even slightly more. And as I mentioned already, I mean, nearly 85% of these savings are already achieved in '24 and in '25. So that I think in overall, we are satisfied with the outcome of the restructuring. Yes.

Okay, shortly on the ESG, I think we can be proud here. I mean we have plus 24% in renewable electricity. We have minus 6% in waste and circularity. And we still have a waste of 2,150 tonnes. In -- so our Scope 1 and 2, we reduced by 14%, which is, by the way, in line with the STBi. And for me, I would say the most important one on this slide, not because of CO2 and so on, but the workforce injuries went down. So our total recordable insurance rate went down by nearly 1/3, so by 28% to a rate of 1.15, which is, I would say, in our business, a good benchmark, definitively.

So coming to our strategy, I want to just elaborate that now because we did an acquisition, we are not only moving towards acquisitions. We still want to be in a growth mode in our core business. We did ongoing investments in our productivity, in our automation solution for our sheet metal market. We are offering a broader range of products for our full life cycle management. It goes in combination, by the way, even with our service offerings. We still see some white spots in the world. So we will focus on expanding regional markets. And of course, we still aim to gain back some market shares. I don't have final numbers. One year ago, I told you that we lost market shares. I can tell you today, with certainty that we gained market shares back. We will elaborate these numbers and maybe during some roadshows or so we can even share more information on this one.

And then something which was the main focus of mine. I'm coming from a world having a lot of OEMs. Bystronic does not have a lot of OEMs. The few ones they have. They were more concentrated on smaller mom-and-pop shops. I think here, the focus on OEMs as well is here.

Then we made some strategic partnerships. I think these 2 are, in my eyes, quite important. You know that Japan is always a difficult market for European. So either you are Japanese or you don't make business basically. So we have a strong alliance with Komatsu. Basically, the final signing will be in 2 weeks from now at the Komatsu headquarter, where together we want to establish a kind of a sales force and enter to the Japanese mainland. We see quite huge chances here. Then we partnered up with SSAB on green steel solutions. So we still push towards our ESG targets.

And last but not least, beside of the organic growth and becoming again profitable with our core business, of course, we are targeting more M&A. You all read it. On the next slide, I will elaborate a little bit. We definitively want to have a diversification on one hand, but only on our DNE. So we don't want to become Conzzeta again. So we are definitively not buying back Mammut, so don't worry. It has to have our DNE. And so that's very important. Why I want to have this? We have to become more resilient and not being depending only, let's say, from the sheet metal market. But again, it has [Technical Difficulty]. And the second one, what we are targeting as well is, of course, even in our core.

Please wait while you are joined to the conference.

Okay. So even in our core business, we still have some white spots, which we could fill with products. So maybe shortly on the recent acquisition we did, I think you know that we just closed it by the end of January. It will be in our books starting from the 1st of February. We acquired the business -- the machine tool business from Coherent. I know this company from my past quite well. So it was really a target that we were seeking for it. So they made around about CHF 80 million. So far, we only shared the USD 100 million. Now I can say it's CHF 80 million, around about 400 employees. Out of them, around 300 in Japan.

[Audio Gap]

It's homeland of one of your main competitors. So could you elaborate how -- what's the reasoning behind that expansion plan? And how do you think you can compete there versus some other?

Yes. The point is that this competitor is even a competitor of Komatsu. Komatsu has a wide range of products in the -- for the sheet metal processing industry, but they don't have a strong laser to compete against AMADA. And we do believe that together, we might have a chance to get bigger orders in Japan. That's really a strategic alliance for Japan Mainland at the beginning.

Thanks. And related to that, but specifically towards the U.S., do you see that the weaker yen versus the strong Swiss franc has a competitive impact for U.S.-related business so that AMADA would have an advantage pricing-wise due to their weak currency?

Yes, of course. I mean this was a big driver over the last few years. I mean that's the truth. I mean the Japan yen decreased, I don't know, 30% year-over-year in average, right? It was a big competitive advantage, but we should not underestimate that we are quietly strong localized already. So there are import taxes. And I do believe that the company will make -- who will make the race is the one who have the right mix between import and localization. And AMADA is doing the same. So AMADA is localized quite heavily, like we are. So from this point of view, I don't believe that this will be a further big advantage. And I can tell you, price-wise, we are more or less in the range. So it's not that we are more expensive than AMADA. So we are tracking the pricing quite closely. So I would even say that we are slightly below.

And last question for now. Thanks. Since you don't expect the market recovery for now, could that also result in an additional cost savings since you actually -- when you announced the cost savings, you expected a recovery of orders already by second half '25?

As per today, otherwise, I would have announced it, we are not expecting a restructuring in the way we did last year. We are further improving our setup and adjusting our setup. As I mentioned before, we -- the project and the product mix we have is not anymore the same like we had in the past. In the past, we produced single machines in high batches in a line. And now we are going more towards project. So it is rather a transformation to meet these requirements from the market. And with that, of course, we're always working on improvement on our cost base.

[ Thomas Morris, VBAG ]. What is the reason for the weak sales, Korean market? Is that due to the political unrest, which we have seen? Or is there a structural change in the market?

We are right now checking it. We are -- the first view is that, of course, it is becoming less a Western country. So Korea -- South Korea was always a Western country for me, very strongly related to the U.S. They were buying stuff. I mean, when you went to South Korea, you see German cars, you see American cars. I think the most McDonald's outside of the U.S. are definitely in South Korea, Kentucky Fried Chicken. And now we see a little bit switch towards Chinese low-cost products, right? Is this a trend? Is this a reality? We are checking it right now.

On the other hand, we see that there's a big demand for Smart Factories. So when I'm talking about Smart Factories, it's whole systems, not only a single machines. And there, we still see a huge potential for Bystronic. But of course, we -- from our side, we have to decide, is it more a Bystronic premium product market or is it more a Chinese? Then the DNE would maybe be the better fit. So far, we serve it very strongly with Bystronic premium product. So this is something we have to analyze. We are right now -- so some of our people are right now over there. We're doing a market study to understand it, but I personally believe it's more structural change in the behavior of the South Koreans.

Yes, I'm not sure if I fully understand the guidance. You mentioned a step toward profitability, but that means you expect not to reach profitability yet in '26?

There is something -- it's a good question. It's too early to say it. I mentioned today that we are going towards a system supplier, which was always our strategy, which in my eyes is the right strategy. It depends a lot in how much net sales we can recognize this year. So again, the delivery times are in a completely different sphere than we had in the past in the machines, right? So for me, the much more -- the more important indicator will be the top line in bookings, in order intake. And the net sales depending of when we have the order intake within this year. So if we get the CHF 700 million order intake in the last quarter, we will not make net sales. And this has to be -- and this is, I think, a change in paradigm. This is a change in how you have to look at Bystronic.

So we have long delivery time. I think Javier will maybe mention something on this. We are even checking whether our sales recognition is the right one as we do it today, right? So because we only do it after the final acceptance test. So if we have a customer which wants to have a different screw, we have to wait until we change the screw so that we can do. So we are checking a few things on here, but it all comes with the volume in this case. So if we will have the net sales, there's a big chance that we can achieve it. If the net sales will stay a little bit behind just because of this reason, then it will be very challenging.

Torsten Sauter, Kepler Cheuvreux. Can you remind us of the ForEx sensitivity of the business in its new scope? I understand that the euro, the dollar, in particular, are much weaker versus the Swiss franc in the new setup and you have a lot of production and overheads in Switzerland. And when I look at the results for 2025, I see in the financial result, quite significant hedging and intercompany financial ForEx-related items. Should I expect them to be in the same magnitude more or less in 2026, given the current spot rates?

I would say, yes, there will be not a big movement. Obviously, with Rofin coming in as from February, there will be also a slightly change. But I would say that their split of currencies is actually similar.

And just if I may, you have stopped disclosing regional or geographic revenues, right? This is no longer available, right?

We did not show this, in fact. As I mentioned this that, let's say, for Bystronic, it's 50% for Europe, 35% North America and let's say, APAC plus China, it's 15%.

[indiscernible], Commerzbank. I would like to go back to the question of -- I'm sorry, I forgot your name. You mentioned that now you're looking for more sales to coming back to a positive financial result. Well, more sales also says that you have more bills to pay and you have more payouts. For you, where is the point where you can get a positive result? What is the target of sales in total, where you can say if you have those sales, then we have a positive result?

So you're looking for the breakeven point, right?

Yes, yes.

Let's say, we will still have some positive impacts from the restructuring and not a huge amount, which will be in '26. And I don't know if you should say it, but if we can get somewhere between CHF 650 million and CHF 700 million, then, let's say, excluding Rofin, if you add Rofin, then for sure, we will be positive, yes.

But I think...

With CHF 650 million of sales, you can reach additional EBIT of...

Without Rofin, yes.

[indiscernible] million. In combination with ongoing savings still plus roughly CHF 40 million more in sales. Yes.

Yes. Maybe a question from my side, [ Mark Bosa, VBAG ] as well. Concerning the change from like single machine to projects, and you talked about the sales recognition, I would wonder about the cash flow side. Can you elaborate on the shift towards like prepayments, then milestone payments and then payments in percentages on the time axis in order for us to understand?

I mean this is absolute no change there. We are quite safe, I would say. I mean we are getting usually around about 30% down payment and 60% before delivery. This will not change even if we sell a system. So basically, we have 90 -- usually, in average, we have 90% of the cash in-house before we deliver. We have only a few big OEMs like John Deere, where we might make an exception. But in general, we have 90%. There is no shift even if we go for systems. And we are not aiming to change yet to POC or whatever. So what we are doing with the sales recognition is not in any connection with the payment and not in any connection with the customer.

And this is probably an important message, right? So payments is one thing and, obviously, sales recognition is a different thing.

And then just to come back to the previous question, the CHF 650 million breakeven on an EBIT basis or on a net basis?

On an EBIT basis.

EBIT, okay. I might have missed it, but the midterm guidance, you didn't reiterate that, that still stands.

It stands, yes.

5% to 7%.

Yes.

Okay. And a detailed question, just out of interest, you mentioned data centers were a big supportive driver this year. How much of sales does that make up of orders?

I mean we have -- I would say it's difficult because many of our customers are supplying parts. I mean not 100% of their volume goes only to data center, right? But I mean this would be a rough estimate, but I would say 10% of the System business. So overall of the group, we are talking about 6%, 7%. And why we did mention it is especially for the large Tube machine where we got large orders last year because of data centers in the U.S. really, which are really -- as on the Tube, I can say there, we have a few projects dedicated only to the build of data centers. Whereas on the flat sheet metals, it's a product mix, right, which is difficult to predict.

I would still have another question concerning the visibility due to the business kind of shift towards more project orientation that is longer lasting, but where visibility should increase, no? Is that correct?

It is correct, right? So we have a much better visibility. That's why we are cautious. So we see the project. We have a kind of a better planning, but it requires a longer waiting because the customer, they plan for a longer time instead of buying a single machine, right? So this is different, but it's the world I'm used from my past. And again, this is the only -- there will be a kind of a time until the shift is done, right, especially net sales, right? And that's why I look very much on the order intake.

And concerning the capital employed, there is a little change there, no? Even though time...

There should be no change, no. Let's say, the volume per project is obviously bigger than selling a single machine. But from -- you mean now the working capital impact should be really minor.

Okay. Do you consider factoring solutions in order to smoothen out certain balance sheet days?

If you consider what?

Factoring -- using factoring, for instance. That's not a topic.

No. Right now, not. It's also an expensive financing method, right? Yes.

Do we have any questions in the call? We have no questions from the phone so far.

We have a last -- second registration from Walter Bamert, Zürcher KB.

Can you help me with modeling the Rofin? So you gave CHF 80 million revenues. And I think the company has a decent profitability stand-alone. But perhaps you have purchase price allocation issues and perhaps also you reinvest some money to put it on, let's say, more fit for the future with more R&D or whatever. So that could also lead to a lower profitability. So what should we expect for this year and, let's say, 5 years out in the future?

Okay. Walter, let me answer on this. You bring it to the point, right? I mean when we made the announcement of the acquisition, I said it has to be higher than our corridor. Coming back what [indiscernible] asked, right? So of course, it should be higher than what we expected in the midterm for Bystronic. It's a completely different market. For the first year, I would say we have integration costs. We will have some investments, and we should not forget that partially it is a carve-out. So the big chunk is coming, of course, with the company we bought in Germany. But the rest of the world is a carve-out. It's combined with certain costs. But even though I would say we are in the lower range of the midterm guidance we gave even already for the first year. This is our target.

Okay. And investments into the future, any plans are made already?

Can you repeat it? I missed the first question.

Will you step up the R&D, for example, of this company or other activities where you say we need to invest first...

Yes, definitively. I mean the first target is to have a smooth integration, so a smooth decoupling from the owner from Coherent. I think this is the first target. So for me, it's like taking a baby out of an incubator, cutting all the tubes and see whether it still can walk. We are pretty confident. So we will be very cautious at the beginning. But yes, we see huge synergies. And as I mentioned, they are bringing technologies we do not have yet in-house like marking, laser marking, laser drilling, which can be combined to our products. So it's not only that we have a market access to new markets like semiconductor and health care. But of course, in terms of R&D, we will invest quite significantly. I think Bystronic always spent a lot of money. I think we can ask our Chair. I think we are quite on the big side in spending in R&D. So innovation is key. So we see huge potential there, and we will invest, yes.

Just for online, it's better.

Yes, to be on the safe side with microphone. Conceptually speaking, you're moving up the share of automation business compared to single machines business. In this transition and kind of outside-in perspective is a little bit clouded when you go into project-related and execution-related business mix. How should we look at the risk inherent strategy compared to selling standard machines basically?

It's always risks and chances, right? The risk is that we have an organization who cannot carry projects, that we have an organization who does not have the visibility or the transparency to track the project. And the chances is we have a great CFO now who helps me to bring me this transparency. I know the System business quite well. I think next week, there will be the announcements even from Andritz, and I think you will see great numbers, so you can make good money with projects.

We are benchmarking even with peers and so on. And the biggest chance I see is that we have a kind of a USP with our solutions, especially driven by the software, right? And the difference is, Torsten, nobody of you asks how much the costs are of the engine of your car, right? So basically, you -- either you buy BMW or BYD or Daimler or Volkswagen, and this is the price for the system you get, right? And you want just to drive from A to B. And that's exactly what we have with our customer. So my expectation is that we -- even on the margins of the single machines, which are still part of the system. So we should not forget, we still have the same components combined together to one system and nobody talks anymore about the single engine, which is built in there. So that's a big chance.

For those projects, not for now, no. But this would be like the path to evaluate, right?

As I don't know, you stole the microphone from Torsten, maybe. Okay.

He didn't want.

One question from the chat from Aurelien Sivignon from ODDO BHF regarding Rofin and diversification. After Rofin deal, would you say it's time now to focus on consolidation and integration? Or do you see further opportunities for diversification in 2026?

I mean, we talked a lot together, right? If I would be alone, Heinz, I would drive the diversification even more, right? And I'm always saying, "Hey, of course, we have to make an integration. Of course, we have to stabilize the business, but I'm always saying opportunities are not always there." So if the opportunity is coming tomorrow and it is the perfect right fit, then we have to do it, right? It's not that we can say, "Okay, now let's stabilize everything and so on and in 3 years, we start again." The opportunities might not be there in 3 years. So that's my clear focus.

Of course, you need to have a stable management, which we have today. I think, again, we still have negative numbers, and I'm absolutely not happy. But if you see the change despite the lower net sales to this profitability, negative profitability we showed, we need a big, big step in the right direction. So -- and now we can always say, "Let's wait, let's wait, let's consolidate and so on." Again, if there is the right opportunity, we will make both decisions and try to make it. And I can only say that the cooperation with the Board of Directors is great in this direction as well. So we are perfect in time.

I guess there are no further questions. Exactly, yes. Very good.

Perfect. So anything I have to say, just thank you very much. It's, by the way, a pleasure to see so many attendees here, and thank you very much. I mean we will anyway stay connected. Please feel free to reach out to us if you have any questions. Javier is here, and we will have still the chance to talk for out here, right? I think there's an up/low. And yes, thank you from my side.

Thank you so much.

Ladies and gentlemen, the conference is now over. Thank you for choosing Chorus Call, and thank you for participating in the conference. You may now disconnect your lines. Goodbye.

Good morning, everybody, and great to meet you and I'm pleased to present you our half year results 2025. We -- as usual, we have the same agenda. We will go through the business review, afterwards, the financial review. And then I will give an outlook for the full year 2025, and then we will close the session with an open Q&A.

Before we start with the business review, please take a minute to go through the disclaimer. I will just read it by myself and expect you do it in the same time.

Perfect. So let's start with the first slide. Can we say that we are pleased with the performance of the first half year 2025? Of course, not. We are still negative. On the other hand, it went as planned and as we expected. We had a still challenging market environment, but we saw a stabilization of the order intake with this nearly CHF 307 million (sic) [ CHF 309 million ] which is an increase of 3.5%.

As expected, we have a lower net sales, but I want to emphasize, and you will see it later on, that we have the first time since years, a positive book-to-bill ratio. That means net sales lower than the order intake, and it was exactly as expected. Thanks to our cost reduction efforts and our reorganization and even our operational excellence, our EBIT loss was substantially smaller than last year despite a similar sales level, which is a huge achievement of being better by 66%, which I think it's the biggest achievement of the first half of the year.

So how the market looks like, it's a mixed view. I think we can start with the order intake on the left side. That's why I'm talking about the stabilization on a low level. So we had a continuous fall down since years. And now we see that we reached a level with a side where it's move. And of course, from quarter-to-quarter, it might be a little bit different, but we are more or less in the same range.

Let me give you an update on the market development and what we are seeing per region. The market has been weak in the past quarters. But again, we think we have reached the bottom, and we could stabilize orders. And we should not forget that -- there is always, especially in Asia, a price deterioration, which means that we are even selling in terms of machines more, right, to reach the same numbers as in the past.

When we initiated the restructuring, I have mentioned that we faced some quality issues and therefore, have also lost some trust from customers, which, of course, ends up even in loss of market shares. And I think here, we have done a fantastic job to regain. Our worst-case scenario could, therefore, have been that we lose additional market share, but we don't.

However, we could stop this negative trend and see positive reactions from the customers. And here, I have many, many examples, but I think we see it with the stabilization of the order intake. When it comes to the regions, everybody could think that Americas leaded by U.S. could be weak due to the tariff situation. I think here we managed the situation in a very good way. I just want to remind you that we have our own manufacturing in the U.S. as well. We reacted very fast. So we increased our portion of local sourced part and local produced part in America so that we were able to swallow basically the tariffs.

And on the other hand, the market even accepted a slightly price increase. So we still see a quite strong America. So it's above our expectation. Positive as well is China. We have really good demand for automation and smart factory solution. This for our Bystronic brand as well as for our second brand, DNE. So let's put it this way, the package made by the Chinese government is really supporting the market dynamics. APAC is from region to region or from country to country a little bit different. But in overall, it's better than we have expected.

The biggest pain we have in EMEA led by Germany; we don't see a real recovery in EMEA. This is somehow disappointing. Was it expected? Yes, that's why I'm very cautious to say that there is a very strong recovery. So we don't feel ramping up so far. It is from country to country, slightly different, whereas countries like Italy and Spain are performing quite well, but DACH really, really difficult.

So it is in overall, not the dynamic we would wish to see. But in overall, again, order intake and the development of the order intake is stabilizing as expected.

On our next slide, I want to just emphasize that -- I have a problem here with the slide, one second. We have -- yes, so now we are on the right line. We have successfully completed our restructuring and our reorganization, which was, of course, one of the most risky part of the last months, but it worked quite well.

Before we dive into the results of our restructuring, let me once again provide some more context here because it's very important why we did it and why we were so fast and why we did not lose time to make it. I think this is very important.

So with the measures I have just explained, we could substantially reduce our cost base -- no, I think we have -- excuse me, just go one slide back. I mean, again, we have introduced our divisional structure with Systems and Service, and we kept our strong market focus, clear responsibilities and fast decision-making.

As I mentioned at the beginning, there is a restructuring process in there why the result is better, but we even increased the efficiency. So operational excellence brings to better results as well, right? We consolidated group functions. We optimized production setup. And this is something we are starting really to feel, and we see it even in our numbers.

On the other hand, it's always the biggest risk when you do a restructuring that you lose your performance in innovation. And I think here, with the move to integrate the R&D into the divisions, especially to the division Systems helped a lot to reduce the time to market, which often was a problem in the past.

So -- and then again, expansion of automation solutions, it's key. We see it all around the world. So more and more automation is coming in. So our strategy from -- to develop ourselves from a machine supplier to a system supplier is definitively the right one. And that's why we just recently announced that we are opening our new smart factory even in Bilbao because we are pushing smart factories and solutions. We still have opportunities. I mean, we are a Swiss company. The market expects Swiss quality. I told you in the past that we had some quality issues. I think we are -- we have not yet solved everything. We still have some, let's call it, relics from the past. But slowly, but surely, I see an improvement even on this one.

We are coming up with a market-oriented product portfolio. We just defined our road map. I think we made great achievements here. And you will see it later on. We -- the focus on tube laser cutting system pays fully into the order intake.

So the competition of our restructuring and reorganization led to a lower cost base. I think here, the numbers are very clear with the measures we just explained, we could sustainably reduce our cost base. This is also proven by the lower OpEx and [ PEGs ] as well as FTEs. With this performance, we are on track for the commitments we gave earlier this year. So the CHF 60 million annualized savings will be definitely achieved. The 600 FTE reductions will definitively be achieved. There might be that we even had to correct it in the other way around because we see a very strong revamp in China, where was -- which was even part of the 600 FTEs.

But the most important point is that we definitely will have the full annualized savings of at least CHF 60 million. And you see it in the half year result, it might be -- that we will be slightly higher. And 2/3 of the savings in 2025, in my eyes are given. The average number of FTEs went down from 3,525 from the time we kicked off the restructuring to 2,940. Please remind that especially in the first quarter, we still had some FTEs, which were still in the company. This had a huge impact in the personnel costs from CHF 123 million down to CHF 105 million.

Again, here, we will, for sure, see a further improvement in the second half year. But for me, it's important as well, it seems always to be very difficult to use fixed OpEx, but it is possible by closing sites, by doing consolidations. We had many, many assets leased, so by closing these lease agreements and so on. And even due to new locations where we built or we opened up new sites, we will see even further improvements in the future.

So with that said, I think we are definitively on track, a little bit overachieving what we had in mind. So this is something we'll see in the numbers. Perfect. Coming to the next slide, we further sharpened our focus on customers, innovation and people because this is very important because again, you can lose everything while restructuring, but while we restructured and reorganized our business, we really kept a high priority on 3 things, and this is keeping our customers, driving innovation and keeping our people motivated. As you might imagine, every restructuring goes on the morality of the employees. You lose your colleagues, and this is something which can be dangerous. I think here, we managed it quite well.

One of the most important achievements of our reorganization was the renewed focus on our customers. Again, I keep telling everybody, our customers are paying our salaries. Too often, we believe that the salaries are coming from the company, the customer is the key. So we are approaching the customer as one Bystronic. I think this is something which comes extremely strongly out of the new organization and not from different locations and different providers. We are one Bystronic.

And I can tell you the feedback from our customer has been really tremendous positively. For sure, we are not perfect and have not yet solved all issues, but many customers recognize and appreciate the better interaction, communication and the increased support. I think this is very important for the customers. So being taken care is one of the keys in our business. So what we can see is even that the participation from our customers on our events has increased. For example, we have conducted 30% more customer demos versus last year. In addition, we are benefiting of our optimization of our internal processes, and we could even improve our project execution for our customers, which, of course, again, pays into our reputation on one hand.

And on the second hand, if we are leaner in executing our projects, of course, we have even savings, especially in the variable OpEx, installation time, third-party support and so on. But in times of economic uncertainty, customers are postponing investments into new machines. So service becomes an even more important role in customer satisfaction.

Our service business will stay and remains very attractive to Bystronic, but we see an opportunity as a key driver to rebuild customer trust. There will, for sure, be a question from your side why we have a slightly decrease of service. This is a clear own taken decision that, of course, if you lose market share and if you lose trust from the customer, you sometimes have to gain it back, you have to earn it back, but sometimes you even have to buy it back. And this usually goes over a free spare part or small little things, which we do in favor of the customers.

I think let's come to innovation. Innovation is the DNA of Bystronic. It was the driver from the past. I think -- we have to continue on this one. As I mentioned, we already see something in the order intake. It was our successfully launched new ByTube Star, which is definitely one of our lighthouse project, which is opening us new market.

In addition to the new product development, we are further improving processing -- processes, standardizing automation solutions and streamline our product portfolio. One other key accomplished is the full integration of Kurago, which was our, let's say, IIoT software company, which we meanwhile converted into Bystronic software and completely integrated in the Bystronic world. So with this move, I think we will be faster. We will reach more -- we will reach more customers in the future and reach our customer base, which is huge at Bystronic. So software is key, and we centralized it in Bilbao. We have great access to universities. We are increasing our capacities, and it will be a fully integrated part of our System division.

So let's move to employees. We are coming out of a difficult time market-wise, but also following the restructuring and transformation. I can only say our employees have done a tremendous work to cope with all those changes. While trying to improve processes and customer focus. For that reason, we started a new culture and mindset journey with our employees that we are now rolling out globally. And for me, very, very important because, again, we are coming from a negative past. We are going in a positive future, and this goes a lot over culture and how you think the company is going to develop.

The program is geared towards helping employees, improve collaboration and developing an entrepreneurial and more agile mindset to better cope with uncertainty while keeping a strong focus on solution.

So let's come to our operational performance. I think we already mentioned it. It demonstrates the success of the restructuring. Our net sales declined by 8%. Sales declined in both our division Systems and Service to a similar percentage. Today, the Service business accounts for around 30% of our net sales. Our gross margin improved slightly on one hand, due to the product mix effect, a little bit weaker machine business against service share. On the other hand, I see an improvement in operational excellence.

We substantially lowered our FTEs. Our -- also our personnel expense declined significantly. You see here the reduction in OpEx, especially the fixed OpEx by 11%, which is a great achievement. And as we said earlier in the year, we incurred a small amount of onetime costs from the restructuring as announced at the beginning of the year, we are talking about a very low 1-digit million number as expected. So this was, I think, even a good achievement that we could digest most of the one-offs last year.

But yes, the first half year has a little impact still from the one-off. So if you compare H1 to H2, yes, you have to consider this. Taxes are higher as our business in the U.S. is developing strongly. That's why between EBIT and net profit, you see a bigger difference. Yes. And in overall, all of this led to a loss of CHF 13 million, which -- CHF 13 million for the half year.

Yes, I mean you will have anyway questions later on, and we can elaborate more on this slide when we are coming to the slide. So I think we -- when it comes to our balance sheet, we still have a solid cash position that is slightly lower due to the -- on one hand, due to the negative result and corresponding negative cash flow. But during the first half, we have focused on reducing inventory. For example, we could make better use of stock in different subsidiaries. If a customer requests a specific machine, we focused on faster delivery and made it available from the stock in other subsidiaries. This helped us to push inventory level down massively and our equity ratio remains extremely strong with around about 72%.

And again, I think that the biggest cash out we had in here, well, from the one-offs from 2024, and we are talking about around CHF 16 million cash out, which are one-to-one related to the severance payment and so on.

Perfect. Cash flow development. That's what I already anticipated a little bit due to the half year loss, our cash flow was also negative here. I think let me point out some key changes here. Our advanced payment declined by CHF 14 million. Usually, this would lead to a thinking that we had a lower order intake. This is not the case, right? Because once our customer place an order, we take several payments. The first payment is due to upon -- due upon order placement and the last payment is due when the handover protocol is signed, and we recorded our sales. This means that machines has been delivered and installed and the customer received the required training.

The amount of advanced payment we receive at any given time depends not only on new orders, that's what I just mentioned, but also on how far existing orders have progressed. Since our order intake has been weak over the past 2 years, but our backlog was continuously declining, fewer orders are reached, let's say, the stages where follow-up payments were due. These are the main reason for the decline in advanced payment and not because we have less order intake. It sounds complicated, it's not.

For our restructuring, we have made provisions for the onetime costs last year, as I mentioned before. But during the first 6 months of 2025, we recorded a cash outflow for several millions of these costs, which I can say this around about CHF 16 million are paying in directly into this one.

Another item I want to highlight to you from our vendor loan to Mammut back, I think since from 2021 we received a prepayment of CHF 15.4 million. So we still have a remaining outstanding balance of another CHF 51 million, which is due in January 2026 (sic) [ 2027 ].

Okay. Yes, 2025 is a transition year as announced. And before we start with the Q&A, let me show you what we expect for the remainder of the year, right? So we still expect continued difficult market situation. You all know we have tariff discussions. You all know we have FX risks. I mean you have seen it on the order intake. We've cleaned up FX rates, we would have nearly CHF 10 million more order intake. So there are certain uncertainties.

But on the other hand, we see a chance if the markets recover, we expect even order intake to increase in the second half of the year. Historically, even in the bad years, even last year, the second half of the year was better than the first half of the year. That's normally in our business.

Again, I think about currencies, we don't have to discuss the strong Swiss franc sometimes is a burden. On the other hand, it gives even certain advantages. I see that we are absolutely on track with our cost savings. I think here, we can even have a slight upside potential as long we don't have another impact, which we don't know today, right?

So even for the second half of the year, I don't expect a very high one-off costs for our restructuring. There will be some lower-digit million, which will impact. And again, the potential financial risk from U.S. tariffs are not quantifiable. And I'm just saying we have to manage it. So I think we are quite flexible, and we are doing it quite good.

So the conclusion is, I know that we did not make guidance after the quarterly closing. I think I can confirm what we said at the beginning of the year, assuming the geopolitical situation does not get worse, Bystronic expects slightly lower sales compared to 2024 and an improved operating results for the full year compared to 2024. So we are cautious, but I think for the time being, this is the best guidance we can give.

So operator, please move on the first question from the call.

[Operator Instructions] The first question comes from Walter Bamert, Zürcher Kantonalbank.

This is Walter Bamert from Zürcher Kantonalbank. Yes, Domenico, I'm satisfied with the numbers and congratulations to these achievements.

My first question is to get more color on the revenue trend. As you know how the order book looks like, do you expect the top line in the second half to be very comparable to the first half or more towards the second half of last year?

So I mean, revenue, it's usually net sales. I think you are referring to the order intake. It depends, right? So we expect a slightly higher order intake in the second half of the year as, of course, depending on the geopolitical situation. But if it stays as it is, we see a slightly increase compared to the first half of the year. When it comes to the net sales, it depends whether the third quarter will already pick up or it's only the fourth quarter because if it starts only in the fourth quarter, we will not have the positive impact of the higher order intake in net sales in 2025. So that's why I stay with my guidance, especially on the net sales that we are -- we will have more or less sideways movement.

So then the second half would be very similar to the first half in net sales?

Yes, small.

If there is no uptick. Okay. Then you mentioned you had one-offs of about CHF 2 million in the first half. There is some more to come, so one-offs in the second half, about CHF 2 million. That would be correct.

I never talked about CHF 2 million, Walter.

Yes, low single digit million, in that area. And more one-off in the -- at the same level of one-offs in the second half, low single digit million. And then on the underlying profitability in the second half, typically, you have this CHF 45 million, CHF 55 million seasonality. So the second half with stronger profits plus you have the beneficial effect of better trend based on the restructuring and the efficiency gains and so do you expect the breakeven EBIT in the second half or for the full year?

No, for the full year not. This is -- again, we keep our guidance. We will -- we still expect a negative result.

For the full year?

For the full year.

But it should improve. There is no reason why profitability should deteriorate in the second half if we have a stable revenue development.

Exactly.

Okay. Then in the half year report, you mentioned for the first time, quite a detailed explanation on what's going on in the end markets, in particular, agriculture. And I think also in Europe, you comment on some end markets. Is that more related to the problems of agriculture? Or do you really see OEMs or suppliers to the OEMs picking up with orders in those end markets?

I mean, again, from region to region, it is different. So in the U.S., we see rather a pickup, honestly speaking. So we were expecting -- it's over our expectation, honestly speaking. And again, in Europe, it's vice versa. I mean, with the announced package from the EU and especially from the German government, we would have expected a faster recovery. We don't see this right now.

The next question comes from Tommaso Operto, UBS.

Just a quick follow-up on the previous questions regarding to the cost savings of CHF 60 million. I mean, do you have an idea of how those CHF 60 million spread across H1 and H2? So how much of the CHF 60 million is still expected to come in H2?

Yes, this is a very dedicated, I would say, difficult -- no, difficulty, it is not. I mean we definitely have the 2/3 in overall, right? And I would say that -- how to say the percentage, right? I mean I would say still somehow another CHF 15 million savings in the second half year should be possible, depending a little bit on how high the one-offs will be, right? I mean we still have some inventories and so on, but more or less in this range.

Okay. So the large part of those CHF 60 million already came in H1 basically?

No, it's vice versa. It's the other way around. So maybe I did not explain myself well. I mean, if you look at the full half year, the savings of the full half year should be higher.

Okay. And so for H2, do you expect to be on a breakeven level already for EBIT?

For full year, definitively not. There is a slight chance that we might come close to a breakeven in 1 quarter over a period of 1 quarter, but over the full year impossible.

Okay. And then you mentioned inventory reduction for the optimization of net working capital. My question there would be, is that kind of already fully optimized? Or do you see like some further area of improvements for the net working capital for the second half?

I think let's put it this way. I mean, you know how it is. I mean one thing is collecting money. The other thing is optimizing our supply chain and the payment and so on. I mean you know all these stories. The factor is as better we execute our project, the faster we can collect the money. And this was a burden in the past. So if you can't close a project because you have quality issues and so you will never collect the money. And this was a big impact in the past, right?

And here, we still have some, let's say, some -- a little bit of a burden from the past, but we see a further improvement. So there is still slight potential to further improvement.

Yes. All right. And just last question on the tax expenses. I mean you mentioned that there is a regional mix because the U.S. was more important. Is that the entire effect? It's just regional differences? Or is there another impact?

No, it's the biggest impact by far. And the second one has to do, of course, with even so hedging costs and stuff like this, which were very strong. But the biggest effect is definitively from the high EBIT and the high profitability from our U.S. organization, whereas we cannot use the tax losses here in Europe, right?

The next question comes from Aurelien Sivignon, ODDO BHF.

On the market share gains expected in H2, will this involve any changes in pricing? I believe you mentioned during the call some pricing pressure in Asia. So underlying question is, should we expect any impact on gross margin for the rest of the year?

No, not at all. You should not forget -- let's be very clear. We don't have a margin problem. We don't have a gross margin problem. I don't see that we will have a gross margin problem. We would need a little bit of more volume. I mean the restructuring was very successful. But of course, we aim more volume, right? So that's the point. So we are not losing a margin. Of course, it is a tough market. When I'm talking about China, it is a continuous low-price level. So you don't have the same price levels from region to region, right? That means that you -- especially in China, Mainland China, you have different, let's say, different margins than with exporting from China, right? But the mix of both makes it again on a normal level. So that's positive.

The second thing what we should not forget, I mean, we're always talking about FX effects and so on. Of course, volume-wise, top line, it seems to be lower due to the currency. On the other hand, we can even purchase in local currency and buy cheaper, right?

So -- and the second, and I think it is also the last one, which is impacting a lot is really we have some big components, which are buying parts used in our machines. If they lower the price, right, even our price is getting better, but we don't lose gross margin points.

Okay. That is very clear. And then just a follow-up on CapEx. I think H1 level was quite low, I believe, roughly 1.5% of revenue. Is it temporary? Or would you say it can be a sustainable level going forward?

It's definitively target of mine to keep it lower than in the past.

To 1.5%?

Yes, it's difficult. It depends from year-to-year. We will, of course, especially having the bigger IT projects coming up in the coming years. It's difficult to just stick on a number. But from the range, it is more or less the one we want to keep.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Domenico Iacovelli for closing remarks.

Okay. Thank you very much. And sorry for messing up. I had one presentation or one slide missing, but it was my mistake when I printed it out. Thank you very much for listening. I wish you a wonderful rainy day if you are in Switzerland, and I hope some of you are somewhere on the Maldives and enjoying the nice weather. Have a great weekend. See you.