Hexagon Composites ASA Aktie

Good morning, everyone, and welcome to Hexagon Composites Second Quarter Presentation for 2026. My name is Berit-Cathrin Hoyvik, and I'll be moderating today's presentation. Joining me in the studio today is our CEO, Philipp Schramm; and CFO, Eirik Lohre. They will take you through a company update, financials and outlook before we wrap up with the Q&A session. a reminder that you may submit questions on your screen at any point during the presentation. And with that, I'll hand over to Philipp.

Thank you. Good morning, everyone, and thank you for joining us today for our Q2 2026 earnings call. Let me start with the headlines. I can proudly describe this quarter as a turning point for Hexagon Composites. Over the last year, we've been focused on improving our resilience, strengthening our balance sheet, lowering our breakeven point and positioning the company for the next phase of growth. This quarter, we saw the results of some of these actions materializing, building on the improvement we have delivered in Q1.

We are now fundamentally moving from a defense position into an offense position. The progress we delivered is visible across 4 important developments. First, we have successfully completed the cost reduction program that we launched during 2025. When we initiated this program, we committed to reducing costs while retaining the capacity required to scale up as markets rebound. We have delivered on those commitments. Second, we have strengthened our balance sheet through a NOK 650 million equity raise and significantly improved our financial flexibility.

Third, our Mobile Pipeline business signed the largest order in its history in July. We secured an order of USD 100 million equivalent to NOK 1 billion. That opens up a new application for our technology in supporting data center power generation. And finally, we secured an important long-term agreement with IVECO BUS who has selected Hexagon Agility as the exclusive fuel system and cylinder supplier across its entire global CNG bus platform, and this for the next 3 years. As I mentioned in previous quarters, our goal was never just to navigate a market downturn. Our goal was to emerge from it as a stronger, more resilient and more profitable company. That disciplined execution is highlighted in these developments and testified in our results this quarter.

Hexagon Composites delivered revenues of NOK 627 million. Adjusting for currency effects, revenues were steady compared to last quarter. What is most significant about these results is the increase in profitability. We delivered EBITDA of NOK 69 million for the quarter, a significant improvement of NOK 57 million from the low point of the market downturn a year ago. This profitability step-up corresponds to an EBITDA margin of 11%, a vast improvement of 9 percentage points from last year. Let me explain some of these actions we have taken to deliver this improved profitability. We have now successfully completed the cost reduction program that began in 2025. This program was ambitious, and it required difficult decision, but it has fundamentally improved the economics of our business.

We reduced our headcount by approximately 25%. With that, we reduced personnel expenses and SG&A costs by around NOK 260 million. Adjusting for currency effects and extraordinary items, the underlying structural saving is NOK 120 million. We reduced layers within our organization. With that, we improved the efficiency and the agility of our organization. We reduced CapEx spend and released around NOK 60 million in core working capital in spite of strategic inventory buildup. With those actions, we improved our liquidity. We consolidated our European manufacturing footprint. With that, we streamlined productivity. And in doing so, we have structurally lowered the cost base of our group.

Today, we are operating from a much stronger foundation, and we will retain the capability, the expertise and the manufacturing capacity needed to capture future growth. Alongside our own operational improvements, the equity raise of NOK 650 million has enabled us to strengthen our balance sheet and amend our lending facilities with extended maturities and flexibility. The proceeds were used primarily to reduce debt. With that net interest-bearing debt now reduced from just under NOK 1.3 billion to NOK 576 million.

Our available liquidity has also improved from NOK 528 million to NOK 796 million after the -- and this is all after the repair offering. This combined strategy has enabled us to deliver on one clear purpose to give Hexagon the financial flexibility required to execute through the recovery cycle and the growth ahead. We now have that flexibility, and we intend to use it with the same discipline that has characterized our actions throughout the last year. Now let's move on to one of the most exciting developments for our mobile pipeline business.

In July, we secured the largest mobile pipeline order in Hexagon's history, valued at USD 100 million, equivalent to NOK 1 billion. This latest order from Certarus also includes an additional option valued at around $25 million through to entire 2028. Beyond the size of the order, it represents our first confirmed entrance into data center power generation. Alongside this exciting new application in data center power generation, we have also taken important steps recently in Europe.

Last week, we secured a strategically important agreement with IVECO BUS. IVECO is the market leader in European CNG transit. After 2 decades of collaboration and delivering more than 10,000 CNG buses together, IVECO selected Hexagon Agility as its exclusive fuel system and cylinder supplier across its entire CNG bus portfolio. Transit remains one of the more resilient parts of our core business and natural gas and biomethane continue to deliver both economic and environmental benefits to municipalities and bus fleets. This new agreement strengthens our market leadership in Europe while unlocking a piece of future growth in emerging geographies. With that, I will hand over to Eirik, who will walk you through the financials in more detail. Eirik.

Thank you, Philipp, and good morning, everyone. Starting with the group financials. We delivered revenue of NOK 627 million in the quarter, broadly in line with the first quarter when adjusting for FX effects. Revenue for the first half of 2026 amounted to approximately NOK 1.3 billion, reflecting what is typically a seasonally softer first half of the year for Hexagon. The quarter was characterized by low activity level in Mobile Pipeline, partly offset by solid performance in Fuel Systems, which delivered another relatively strong quarter.

EBITDA came in at NOK 69 million, corresponding to a margin of 11% and the improvement in profitability reflects both the favorable segment mix and the structural cost measures implemented throughout 2025. For the first half of the year, EBITDA amounted to NOK 126 million or a 10% margin. And overall, we are quite pleased with the profitability development so far in 2026, particularly given that these volumes remain below what we consider normalized levels.

Segment-wise, I'll turn first to Fuel Systems, which, as mentioned, delivered a relatively good quarter with revenues of NOK 450 million and EBITDA of NOK 78 million, and this represents a margin of 17%. The truck market remained relatively quiet in the first half for us, but we continue to see solid activity from selected customers. During the quarter, we delivered meaningful volumes of Sleeper cab systems into Mexico, which is becoming an important growth market for Hexagon.

Transit bus activity was strong across multiple regions in the quarter, not least in Europe, where we have consolidated production in Castle from the month of June, as also Philipp touched on earlier in the presentation. And together with aerospace deliveries and other specialized deliveries, this contributed positively to both revenue quality and margins in the quarter. And all this, together with operational cost improvements, a good mix contributed to very healthy profitability and in fact, our best quarter in Fuel Systems EBITDA-wise since our record quarter Q4 2024.

Moving to Mobile Pipeline, which continues to be lumpy and delivered revenue of NOK 101 million during the quarter, which is significantly down versus Q1. This development was driven partly by timing effects, but also lingering caution among customers regarding capital investments in the North American market, a trend that we expect to see reverse. And looking ahead, we do expect a significant step-up in activity during the second half of the year and also into 2027, driven, of course, by the record Certarus contract we announced in July. And in preparation for this, we deliberately built inventory during the second quarter, and we do expect a significant portion of that inventory to convert into shipments during Q3 and Q4.

Turning to Europe, which delivered a strong performance this quarter, good activity levels in the U.K. and Ireland, where we did supply modules to several RNG renewable natural gas projects in addition to deliveries into Continental Europe, but also into Middle East. And despite the overall activity level remaining pretty low for Mobile Pipeline in the second quarter, the segment delivered breakeven EBITDA, which also reflects improved cost performance and the actions taken over the last year to reduce the structural breakeven level of the business.

Additionally, I do want to note that the discipline continues to guide our market expansion strategy. In Q2, we had multiple opportunities to pursue additional opportunities in South America, in particular, but chose not to participate where pricing didn't support our return requirements. So we do want to protect our margins also when approaching new markets and emerging markets.

Aftermarket, we delivered revenue of NOK 98 million and EBITDA of NOK 11 million for the quarter. The overall parts and service market remains relatively soft as we continue to see fleet operators extending service intervals and also utilizing existing spare parts inventories. That said, the mix is gradually improving. We saw increasing activity in mobile pipeline trailer requalifications during the quarter. And while this is still a relatively small part of the business, requalification activities entering a more favorable cycle that follows mobile pipeline sales volumes in the years following 2020.

Moreover, we're seeing our certified preowned and refurbishment offerings continue to gain traction as our first-generation systems and trailers reach end of life. And these activities typically carry attractive economics and represent a growing share of our external service revenues, but also contributed positively to revenue and margins in Q2.

Turning to cash flow. Cash flow from operations was NOK 128 million for the quarter, which was helped by release of working capital and other accruals. And I do want to point out that this is despite the fact that we have built significant inventory of finished goods, as mentioned, to prepare for the extra and increased activity in the second half of the year, in particular within the Mobile Pipeline segment. So we should expect that particular effect to be reversed in the coming quarters. We continue with low CapEx spend, only prioritizing capital -- critical capital projects. So far this year, we have spent around NOK 20 million, NOK 12 million this quarter against our full year guidance of NOK 70 million to NOK 80 million.

Net interest payments of NOK 39 million included an annual interest payment related to the Purus [ CRS ], which was terminated in April. So I expect this to drop significantly in the coming quarters also because we have obviously reduced our overall debt level. All in all, net cash flow for the quarter was NOK 115 million, which includes around NOK 30 million net proceeds from the equity raise and repayment of debt, but also NOK 30 million from our discontinued operations in Poland, which involved sale of inventory, but also a collection of receivables as we empty the factory in Poland.

On top of our cash flow improvements, I wanted to touch briefly on our balance sheet. Our leverage has significantly reduced following the recent equity raise and refinancing. And at the end of the second quarter, we had gross debt of NOK 972 million, cash on hand of NOK 294 million and net interest-bearing debt of NOK 678 million. And including the proceeds from the repair offering completed in July, as Philipp mentioned earlier, at quarter -- after quarter end, pro forma net debt would be NOK 576 million.

Available liquidity also improved significantly, supported by both positive cash generation in the business, but also additional flexibility from the amended financing agreements. And this stood at NOK 694 million at quarter end, which equates NOK 796 million on a pro forma basis, i.e., including the impact of the repair offering. So all in all, we believe the refinancing and the strengthened balance sheet provide us with the financial flexibility needed to support growth and also execute on our commercial opportunities for the second half of the year and not least beyond that. So with that, I'll hand it back to Philipp to walk you through what we see ahead.

Thank you, Eirik. Let's move into the outlook. As I mentioned earlier, momentum is building across several of our key markets. Moving into the second half of the year, the market environment still contains some lingering uncertainty, but the direction is increasingly positive in mobile pipeline, broader industrial demand, including oil and gas, is showing the first signs of improvement after a soft year where customers focused on asset utilization as we have spoken in previous quarters about.

New demand drivers such as data centers and data center energy demand are now also emerging and beginning to offset some of the cyclical market softness, which we had to experience. For fuel systems, refuse remains healthy and transit momentum continues to improve across multiple regions and geographies. In trucking, after a slow year, freight fundamentals are recovering and the economic case for natural gas continues to strengthen. Also, on the challenges side, we do expect diesel prebuy activity due to the incoming 2027 regulations, and we experienced some lingering caution from fleets who are limiting CapEx investments in new technology while they absorb near-term diesel OpEx increases. However, we do see good momentum and promising signal for the remainder of 2026 and the outlook for 2027 is improving.

The structural drivers supporting natural gas vehicles continue to remain very compelling. While the recovery in our core markets is still ongoing and some conditions remain mixed, I want to be clear that the momentum we see today is fundamentally different from what we experienced 12 months ago. This is supported by our significant better profitability and significant better cost base. These improving underlying trends are why for 2026, we expect to deliver revenue growth moderately above last year's level.

Based on the progress we have delivered during the first half, the strengthening of our financial position, and improving visibility in our key markets, we are raising our full year EBITDA guidance from above NOK 200 million to around NOK 300 million. We do see some normal uncertainty around timing of customer deliveries and project execution in the second half of this year, and we continue to monitor cost impacts from the broader geopolitical environment. That leads me that based on the current visibility, we are confident that the second half of the year will be stronger than the first with an improving base demand in 2027. This quarter's Certarus order validated what we believe could be a major opportunity for our business.

Data centers are rapidly becoming a significant new end market for our mobile pipeline technology. The challenge many developers are facing is simple. Demand for power generation is growing faster than the infrastructure can be built. Grid expansion takes time with wait times exceeding up to 4 years in some U.S. states. Developers are seeking solutions now, and our mobile pipeline technology can solve that gap. Mobile Pipeline modules provide compressed natural gas directly on site for power generation, enabling projects to begin operations while permanent infrastructure is developed. And with the TITAN 510, our latest product launch in May, we have designed a technology platform specifically to service higher volume gas applications.

The TITAN 510 contains the largest Type 4 composite cylinder ever manufactured, enabling a fleet of mobile pipelines to efficiently support power generation for a hyperscale data center. Our technology leadership and the scale of the opportunity gives us confidence that this is the beginning of a potential meaningful new market for our technology.

Moving to one of our other exciting long-term growth opportunities, which is natural gas trucking in North America. For several quarters, we have spoken about the importance of the economics. That remains true today. Alongside the U.S. Class 8 truck market rebounding, fuel spreads continue to favor natural gas and fleets are increasingly focused on improving their operating costs. As I've said before, the industry is approaching an important shift from 2027 onwards. Natural gas trucks now offer diesel-like performance while delivering compelling total cost of ownership. While the latest U.S. EPA regulation revision may extend the transition period over the course of 2027, the incoming EPA regulation from '27 onwards will improve this CNG conversion equation even further.

Diesel trucks will get more complex and more expensive. As we have seen over the last 18 months, fundamentally changing an entire industry that had used diesel for a century is not easy, but we are on it. While the timing of accelerated CNG adoption is difficult to predict, our conviction in the long-term direction remains unchanged. As we have seen the underlying drivers enablers materializing and more and more smaller fleets are piloting our systems. This gives us confidence the market is moving sustainably in the right direction.

To wrap it up, I want to touch on how all of this ties together. First, Hexagon today is a stronger and more resilient company. Alongside a strengthened balance sheet, we have completed our cost transformation and structurally improved our profitability. Second, we have multiple growth drivers across both existing and adjacent markets. Natural gas adoption continues to advance. Transit momentum is positive. The data center opportunity is emerging, and we continue to expand our reach across geographies and applications. And third, -- we are well positioned to capture long-term profitable growth. We are the technology leader in our industry. We have unmatched customer base and unmatched capacity. With that, thank you so much for your interest, and thank you for joining us today. With that, let's move on to Q&A. Berit-Cathrin, please.

We'll jump straight into the first question for you, Philipp, on regulation. How do you see the EPA's recent revisions to the 2027 NOx emission standards impacting CNG conversion?

Positive, first of all, and let me explain you why. the NOx rule holds, meaning that heavy-duty trucks in North America Class 8 trucks need to reduce their NOx emissions. These emission levels, which are proposed can be fulfilled by CNG trucks. Diesel trucks need additional after gas treatment. That means they become more expensive and from a technological point of view, more complex to maintain. So for the adoption of CNG, this is very positive. With the new discussions about EPA27, there is option in there that some of the OEMs can defer it partially by paying a penalty. This is something which we see from our discussion could lead to a slightly increased diesel prebuy into 2027. Nevertheless, the investments made by all the major OEMs to transition to lower NOx emission and compliant trucks will happen, what we hear from everyone. So what we only see is it might be that the diesel prebuy will extend into the early of 2027. So sum it up, it's very positive, and we are happy that it's going in this direction. It's good for our application, but it's also good for the environment.

Maybe to you, Eirik. Given the improvement delivered so far in 2026 and the stronger second half trajectory you're pointing to -- how should we translate that momentum into 2027 expectations?

I think, obviously, it's early days. And typically, we don't provide any guidance for next year at this point in 2026. I think we feel relatively good about the second half of this year. And for those who have followed Hexagon for a while, they know that the visibility is not always the best, but we still feel quite good about the second half. Of course, we have booked some business already, notably some of the Sartorius orders will be delivered.

Quite a significant portion will be delivered in 2027. So that provides a good baseline for our Mobile Pipeline business. We know that our transit business and our refuse business and our aftermarket business is relatively resilient. And as Philipp mentioned, right, we're still trying to learn how those -- the new proposal from EPA will impact the demand for CNG trucks into 2027. But generally, we feel that we are -- we have the low point of the cycle behind us and that 2027 should be another year of market recovery, but we look forward to sharing more insights in the Q3 presentation, but also the Q4 presentation, which is typically when we provide forward-looking guidance or indications.

Another question for you, Eirik, on Mobile Pipeline. Can you give more insight into the forward profitability pattern in Mobile Pipeline? In the second quarter, it was 0 and the $100 million order will show up as revenues in the coming quarters. But which EBITDA margin should be assumed in the past 2024, Mobile Pipeline EBITDA margin was 20%. So is that a realistic level?

I think inherently, the Mobile Pipeline business is pretty lumpy. I think you've seen that with the volatility on the top line over the last couple of years, as an example. We have to acknowledge that we still are at a pretty soft overall market, although we think it is improving. So kind of commercial terms also in contract reflect that, even though we think the margin and profitability of this business will improve going forward. Generally speaking, this is a business that scales pretty well with volumes, so high operating leverage. And we think 20% is probably a stretch, but we're optimistic that we can restore a healthy margin. And I think also we have done quite a good job in terms of reducing cost, both on the material side, but also on the operating -- other operating cost side. So we're optimistic that we can deliver improving and sustainable margin in this business going forward.

A question for you, Philipp, X15N. Are you still securing new pilot orders for fuel systems to the X15N? And could you quantify the number of fleet operators who have or are testing?

We are seeing great interest demand into the application. We also see that the benefit of the X15N is materializing in real life, for example, with our demo trucks, which we provide to a lot of fleet. So the fuel economy holds, in some cases, even better than what we have internally predicted with the current diesel, natural gas spread, the benefit for natural gas.

The return of investment can be for some fleets be unbelievable. And this is what the discussion is which we are currently having with a lot of fleets currently ongoing. But as Eirik said, it's a little bit too early to put the drum out, but it's like something -- it's our work which we do, and it's accompanied by all the hard work which we have done over the last 12 months. And we will continue so because this will drive the adoption up. And this is what we are committed to, and you see it from these results, we can deliver, and we will drive this market forward.

An additional question related to the X15N. The Clean Energy released information about the progress on the 4th of August, where 8 or 9 trucking companies were mentioned. And they are deploying new Cummins X15N power trucks. How does this impact Hexagon Composites?

You can be assured that with all the major releases in the U.S., a major portion of these new trucks have one of our fuel systems on.

Moving back to you, Eirik. Could you please comment on what factors that are driving the decrease in COGS percentage the last 2 quarters? Is the current level of 42% a level we should expect going forward?

Yes. I think first and foremost, our team has done a very good job through 2025, renegotiating prices and terms with our suppliers. And there is a natural lag to see the effect in the P&L. I think we've seen that come through in the last couple of quarters. There is also some mix elements in here. Mobile Pipeline is typically a more materials heavy product for us. So with low mobile pipeline volumes in the second quarter, that COGS margin is probably on the low side compared to what it would be in a normalized scenario.

And so in terms of expectations going forward, I mean, when the mix sort of normalizes and we get more mobile pipeline business in the second half, which we believe, we could expect to see that going up a little bit back to average over the last few quarters, including Q4 last year. But also, as we have talked about in the presentation in May, we expect some surcharges, and we've seen some surcharges related to materials given the higher energy prices, higher freight costs as well. So that's another dimension to it, which would impact the second half expectations in terms of COGS.

And the third one would be the fact that we have, as we talked about in the presentation, built inventory now ahead of the second half because we expect higher demand, notably in the Mobile Pipeline segment. So we have activated some of that cost and that will flow back into the P&L in the second half. So I would say it's probably on the low side in this quarter compared to where it would be next quarters.

Philipp, a question related to Hexagon Purus. What is Hexagon's position in the potential refinancing of Hexagon Purus? Is Hexagon willing to inject more capital?

I think about the last point of the statement, we have been very clear. Like with all our minority shareholdings, we are evaluating the situation of all our shareholdings very careful on a regular basis. We evaluate what the options are. And with always the focus in mind to maximizing the shareholder value for our shareholders. This is the intention all along with everything which we do. This is the maxim Eirik and myself, we are committed to in the entire executive team. And that's also according to Hexagon Purus. I think it's prudent what we have heard and when I listened into the most recent earnings call from Purus that they will evaluate their balance sheet. it's something they might need to do, and we stay open, constructive to their suggestions. But I think we have been very clear about injection of cash. We have contributed in the past, and we felt that this contribution should give them enough runway to turn cash flow and EBITDA positive.

Moving back to you, Eirik, similar on the margin side. Looking at the full year math, if revenue lands above NOK 3 billion and you've been running at a 10% EBITDA margin year-to-date, sticking to around NOK 300 million in EBITDA implies weaker margins in the second half. Should we expect margin compression in the second half?

I think there's a couple of factors that come into play. And we talked about the COGS side of things and with a normalized business mix in the second half. We had some specialty products in the first half that contributed positively to margins, Aerospace being an example. So when the mix -- and we see a mix normalizing in the second half with higher mobile pipeline content, I think also where we are in the cycle and in terms of especially the Certarus contract driving revenue. With volumes in the order of magnitude and top line in the order of magnitude of $100 million, we can obviously also high level of production and offer attractive pricing while still preserving good nominal profitability on our side. So I think all in all, we feel relatively good about the full year. But as I also talked about, there are some cost factors that will come into play in the second half, including the inventory effect, but also the raw materials effect.

Thank you. I think that concludes our questions for today. So thank you for joining.

Welcome, everyone, to our Q1 Trading Update. This call replaces our regular call, which was scheduled for next week to present you our Q numbers. Reason for that is that we have executed last night a successful private placement in the amount of NOK 550 million. Eirik will touch on that in a moment slightly.

I'm happy about an oversubscribed private placement, and that shows great trust into Hexagon. Thank you, our investors, for this trust. This cap rate enables us to have a stronger balance sheet and improved financial flexibility, financial flexibility due to a renegotiated finance agreement with our lending partners, which really substantially reduces the leverage risk and covenant risk, which we had and some of you brought up multiple times during the course of the last year.

But one aspect is asking for the fix of our balance sheet. The other is walking the talk and what is the management, the company doing. We have executed a significant restructuring over the last 12 months. And one testimony, one walk the talk is what Eirik will show you in the Q1 numbers. We have a leaner cost base, and we have tightened cash discipline. This leads to a significant improved EBITDA breakeven point.

This is also supported by restructuring in one of our markets in Europe, where we are consolidating and moving our production from Poland to our facility in Germany, which will lead to operational leverage in the second half of this year. This will mean that we have implemented cost actions with retained capacity to scale. We are the market leader in all our fields, and we are able to scale it up when the market comes back. When the market comes back, we are well -- extremely well positioned for market recovery, and we see first signs of this market recovery.

Let's take one is the natural gas adoption for heavy-duty long-haul vehicles explicitly in the United States, where an increased fuel spread will lead to a shorter payback period for these fleets. This is an indication which we see. We see good signs from ACT Expo, which is a show in the United States where fleets can experience alternative drivetrain solutions. And you can go online, see the reports there. CNG has taken the stage there, and that's promising for me for the way ahead.

Besides that, one area which struggled in -- yes, the last 12 months is Mobile Pipeline. And we really see within the distributed energy solution sphere, new segments evolving. And we spoke about this before and one aspect there are data centers, and I will touch this later in the presentation.

Besides that, we also see demand due to geopolitical uncertainties in the world, driven by the Iran war about energy independence, energy security. So we see interest and really fast-growing interest in geographies like Latin America and the Middle East in our products. And this is also an indication for market recovery at some point. We have entered and we spoke in the last quarterly call about this, entered aerospace, commercial space exploration with our cylinders, and we have another order in that space as well. This is a testimony for what I said that we want to diversify this business, go into other markets and make us more resilient. This makes me feel cautiously optimistic, and we are positioned to capture profitable growth in the years ahead.

And with that said, I would like to hand it over to Eirik, who gives you insights into our Q1 numbers, but also touches on the refinance agreement and the cap rates. Eirik, please.

Okay. Thank you, Philipp, and good morning, everyone. Thanks for dialing in. As announced yesterday, we have reached an agreement with our lending banks to amend our existing facilities. And under this amendment, we will reduce the total exposure to NOK 1.6 billion by repaying NOK 300 million on the term loan and also settling a cross-currency swap on our balance sheet with a nominal value of NOK 200 million by the end of first quarter.

We further extended the maturity of all our facilities from year-end 2027 until Q2 2029 as well as extending the runway for the leverage covenant until Q4 2027. And both of these provide us with additional flexibility to steer through an uncertain market while also reducing the imminent refinancing risk. As you can see on the right-hand side, based on pro forma numbers as of Q1, our net debt after this transaction is expected to be around NOK 740 million and our available liquidity around NOK 600 million.

So we should be in a pretty good shape also from a liquidity perspective after this transaction. All in all, the combination of the amended bank agreement and new equity will significantly improve our financial flexibility and position the company well through this transition phase and for a market recovery.

So before we get into the numbers, just a quick note for housekeeping. I wanted to point out that from Q1 onwards, we are reporting the Polish business acquired through SES Composites in 2025 as discontinued operations following our decision to close that plant down and consolidate our footprint in Germany, as Philipp just alluded to in his introduction. Consequently, we have restated our Q4 2025 numbers for easier comparability with the ongoing operations.

Moving into results for the first quarter of 2026, which was another step in the right direction for us, NOK 669 million top line, around 5% lower than Q4, adjusting for currency effects. But as you would know, Q1 is typically a seasonally softer quarter for us. But we did see better activity levels than expected, especially in the Transit segment of our Fuel Systems business. Refuse, which had a record year last year, held up relatively well in the first quarter. And while the Truck segment remains relatively low, we see a fairly good product mix with higher content of sleeper configuration, which carries a higher sales price.

I also wanted to specifically point out that we have shipped our first batch of specialized aerospace cylinders in the first quarter, which notably only comes 1.5 months after being awarded the contract. So it's a great accomplishment by our engineering team and our operations team in the U.S. In Mobile Pipeline, we delivered on par quarter-over-quarter with better sales in the Americas, including to new customers, encouraging development in Latin America and Brazil specifically.

Profitability-wise, we delivered an EBITDA of NOK 57 million, which corresponds to a healthy 8.5% margin. This marks the best quarter for us since the record quarter we delivered in Q4 2024. In the quarter, we really enjoyed favorable mix effects, better volumes from Mobile Pipeline in North America. I mentioned the high-value sleeper truck configurations in the truck side and also the highly engineered specialized aerospace products contributed to a strong contribution margin.

Further and in line with previous quarters, we were also able to realize favorable materials prices and production costs for the quarter. So all in all, we delivered a relatively healthy profitability and a significant improvement both compared to Q1 last year and also Q4 last year.

Looking at the cash flow, we had NOK 30 million change in accruals and working capital in the quarter. And on the right-hand side, you will see a breakdown of the working capital. And worth noting is that our inventory reduced by close to NOK 100 million in the quarter, which is in line with expectations and also previous guidance. This was partly offset by an increase in accounts receivable, which we expect will be converted to cash in the coming quarters. In addition to that, we have cash outflow related to timing effects of annual bonus payouts in Q1, which further impacts the total number for the quarter.

But the underlying trend is considered positive as we see the effects of our inventory shrinking in line with our ambition. Deducting CapEx, interest payments and leasing payments, we ended up with a total net cash flow of negative NOK 33 million for the quarter, and we expect, as already guided, cash flow to improve in the coming quarters.

Brief look at our balance sheet. Net debt by the end of Q1 stood at NOK 1.061 billion. For the avoidance of confusion, this is excluding the cross-currency swap, which is a derivative instrument that we refinanced in this transaction. And after the transaction, total net debt all in is expected to be around NOK 740 million, as mentioned. Equity ratio, as you see in the middle, is 48% by the end of Q1, expected to be 58% after the transaction. And last but not least, available liquidity stood at NOK 528 million, which would then correspond to around NOK 600 million on a pro forma basis based on the Q1 numbers after the transaction.

And to summarize the very brief finance section here, we delivered a significant step-up in profitability in Q1, which is a direct result of our cost program and the progress we have achieved on making our business more resilient. And also with our actions as announced yesterday, we also have in place a stronger balance sheet and more financial flexibility, which better sets us up to capitalize on the opportunities we see in the short term and midterm.

So with that, I'm going to leave it over to you again, Philipp, to take us through some of these opportunities.

Thank you, Eirik. Let's come to the commercial update and to the market fundamentals. As we have said in the past, if you see our business, we have more or less 4 pillars. Two of these pillars are relatively resilient and 2 pillars are more or less cyclical. The more resilient ones are Aftermarket, Refuse and Transit. And the ones who are more cyclical are Truck and Mobile Pipeline. But also these 2 bear or have the opportunity for us for the biggest growth in the future.

And let's touch on these 2 step by step. Let's go to Truck, and we spoke about this before. CNG adoption was impacted by the feel of the diesel-like experience. This diesel-like experience or diesel performance on range and total cost of ownership is now in place with the new Cummins' X15N engine and our fuel system on board. This closes the efficiency gap to diesel. So the diesel-like experience for torque, power, et cetera, is now given.

It's not an excuse anymore. We know the refueling infrastructure is in place and is consistently improving. You know with our partner, Pioneer, we have leasing offerings now in the market explicitly for CNG-powered vehicles. And as we have spoken in the past, with EPA '27 NOx emission rule in place from January 1, 2027 onwards, there will be requirements on diesel, which CNG can fulfill.

Let me come to the next slide, which shows you one big aspect for U.S. fleet is the profitability aspect besides the emission aspect. What we have seen over the past, also in the years, and we spoke about this over the last years as well is in diesel, we saw a lot of spikes, like kind of a fiber curve going up and down. Natural gas stays relatively flat or flattish here. Why was this the case? The case is in the composition of the fuel at the pump in itself. And we try to give you an illustrative explanation of why is this the case? Because if you take diesel, the pump price of diesel is with the majority impacted by the refining aspect and the commodity price of diesel.

More than 50% of the pump price of diesel is impacted by these 2 aspects. If you take CNG, the commodity price is significantly lower, less than 30% or whatever, that's kind of an indication where it is. So if the commodity goes up, diesel goes significantly more up than CNG. That leads us to significant better paybacks. And you will see this in the appendix, and I invite you to dig through our vast documents, which we have provided you with the private placement that what you currently see with the spike of the diesel prices explicitly in the United States, you will see for fleets who have CNG trucks a significantly better payback. We didn't even encounter in these numbers 2 to 5 years, what we are currently seeing and where currently the diesel price is trending towards. So this is a real alternative and saves fleet money.

If you come to the next slide. What does this mean for us? For heavy-duty long-haul trucking in the United States, and we have shown this before, the industry aspiration for adoption of Class 8 trucks to CNG is 8% to 10% all along. This would mean in a normal year of 300,000 heavy-duty Class 8 trucks, a potential of 30,000 trucks. For us, with our current market share, what this mean a revenue opportunity capacity of $1.5 billion.

So as we spoke before about, we have a lot of pilot customers out there trying the X15N engine with our Fuel Systems on. If they all would convert similar like a UPS converted their fleet, this would mean for us, just for us with the current market share, a revenue potential of $750 million, which can be served with our installed revenue capacity, which we have in place. So the potential is there. Now we need to see to tap it and turn this around.

Let's come to the other growth area, and we discussed this a lot, is Mobile Pipeline. We have, and you see it here, TITAN cylinders, the largest composite cylinder in the world for mobility or transportation applications. It's 75% lighter than steel. It provides 2.5x the capacity compared to steel.

It has a value proposition, provides you as a gas distribution company, a competitive advantage. We have more than 2,000 modules in operation globally for gases like CNG, RNG and helium. And our newest products, which were launched like the TITAN 510 just in May of this year, we are moving forward in this direction. We are not stepping back. We are moving forward and developing our products further.

What is true is that when I came on board in 2025, this market had a significant impact by higher or lower oil prices, reduced shell activity, and we suffered this. And as Eirik mentioned, we took action and restructured the business without taking capacity out. What we currently are seeing is there is interest for utility resilience. There's interest for energy independence in growing market like in the Middle East, but also in South America and in Africa.

And what we also see is really rapid deployment for power for data centers, which are in -- sometimes don't have access to pipeline gas or have no access to high-voltage grid infrastructure or awaiting permanent infrastructure solutions. And this is supported by the next slide, you will see that one of our customers Certarus here, who is owned by Superior, announced a deal with a data center to supply this data center with natural gas.

And they explicitly spelled out that just this one data center has a potential for 200 additional CNG virtual pipeline modules, meaning Mobile Pipeline units. Certarus has currently a fleet of 880 trailers. So you see the impact for them and the potential growth there. And in this market in North America, we have a market share of 50%. We've an average deliver 200 Mobile Pipeline units and modules per year to this market.

So we would be able to step into this market and serve this market. If we move on to see what we did as well is one aspect which I elaborated a little bit at the beginning is really differentiate us going into different opportunities. We announced the USD 7 million order in the last quarterly call. And I want to inform you that we got another -- from another commercial aerospace customer, another order of approximately USD 5 million delivering cylinders for commercial space explorations.

And we are actively evaluating follow-on opportunities in this space. And this is a testimony, as Eirik said, about our capacity, of our capabilities within our technological know-how and how fast we can turn these very demanding requests and projects around. This is a testimony for us, and I'm happy that we are driving this industry forward. And we have been the pioneer in composite cylinder manufacturers dating back to the 1960s. We have a unique system design and integration competency. We have deep relationships with key alternative fuel fleets.

We know them all. We know the market. Our team is every day on the road talking to fleets, trying and solving issues for them proactively. And this leads for me what I feel to potential in the future. We have proprietary testing and recertification technology. This enables us to test without destructive testing to test these pressure vessels. It's a key enabler for certified preowned programs.

So taking into account what we have accomplished over the last years, we have 600,000 high-pressure composite cylinders manufactured and in the market. There are 100,000 and more vehicles on the roads with our Fuel Systems on. We have 17 billion -- more than 17 billion miles of real-world fuel system validation. So we know the market. We know our system, and we are homologated and integrated in 29 OEM platforms. This is here unmatched. And we have the capacity. We have the know-how and we have the team behind it. And that makes me proud to look forward.

And with that, I would hand it over to Eirik to give you an outlook on what we see for 2026. Eirik, please.

Okay. Thank you, Philipp. So if we can jump to the next page, there we go. So we're seeing the underlying trends, as Philipp said, in our markets improving somewhat from 2025, still a mixed bag in terms of challenges and drivers and opportunities. So our Mobile Pipeline segment is still in a soft market sentiment. We do see, however, improved commercial activity and interest in the Americas in particular, both in Latin America, as we alluded to earlier, but also in our core market in North America.

And as Philipp also alluded to, we are seeing data center as a potential source of new demand to this industry, which is very encouraging and exciting for the industry. On the risk side, we do see energy prices impacting input costs and potentially putting some pressure on margins in the quarters ahead. So we are monitoring that situation very closely. When it comes to the fuel system side, we have a freight industry that is recovering, but also now struggling with the higher diesel fuel costs, which, of course, we hope and believe will boost adoption of natural gas as an alternative in the medium to long term.

That said, we do expect to see some diesel prebuy activity ahead of the EPA '27 rule, which will be implemented from January 2027 and add extra cost and complexity to new diesel trucks being delivered from 2027. We continue to see good momentum for transit buses, especially in Europe, where we expect to see the full benefit of the consolidation of our operational footprint and consolidation of SES Composites in the second half of the year.

And as mentioned a couple of times already in this presentation, we are looking into further aerospace opportunities as well, which we hope could materialize. Last but not least, our Aftermarket business is expected to see some improvement versus 2025. On the risk side, fleets are struggling with profitability with these high diesel costs, which clearly impacts their ability to service trucks, not only diesel trucks, but also CNG trucks and also replace parts.

But we do expect that softness to be offset by a higher activity on the cylinder inspection and recertification business compared to last year. So that was a brief summary. And I would now like to go into how that translates for us. So based on our current visibility, we do expect revenue in 2026 to be largely in line with 2025, which was around NOK 3 billion.

We are seeing positive signs that the market's commercial activity and our quoting pipeline are building, and we hope to convert to firm orders but we have to acknowledge that the order timing remains uncertain at this point in time. We do see some pressure from higher energy costs, inflating pricing on some of our key raw materials, increasing freight costs. And this is obviously a situation that we will monitor closely in the months and quarters ahead and having the extra financial flexibility that the new bank amendment and equity raise provides us is obviously a big benefit for us in this period.

In spite of this, we have seen strong progress on our operating costs, and we do anticipate a meaningful improvement in profitability versus 2025 and also a positive free cash flow for the year. And as we said in February during our Q4 presentation, we are cautiously optimistic on the year. And as an indicative guidance on EBITDA, we do see a minimum NOK 200 million for the year, of course, subject to market conditions.

So with that, I'll invite Philipp back on the screen to wrap up.

So thank you, Eirik. I think what you heard today, we are well positioned to deliver long-term profitable growth. We are the market leader. We have the market position. We have -- we are the incumbent and the technology leader. We have the capacity, the capabilities, and we are driving this business, this industry forward. We have walked the talk. As you heard, we have done our part. We have structurally improved the cost base following the challenges which we've seen from 2024 into 2025.

We are well invested. We have a scalable platform with strong revenue and EBITDA potential. And we have really strong prospects for profitable growth in our core markets and adjacencies. We see this, and I said before, that there's interest. We spoke about this before that we are enabling the right fuel for the right application at the right time.

And seeing what has been on display and being spoken about at ACT Expo in Las Vegas this week is that the right fuel to replace diesel now is CNG, RNG. And we are the market leader for the right application, the right solution for heavy-duty long-haul and high energy-intensive mobility applications.

And for that, thank you for your interest in Hexagon Composites and your trust in us and looking forward to your questions now. Thank you.

Let's see. We have a couple of questions from the audience. Philipp, first question for you. How do you view Cummins' latest announcement that they're going into direct competition with you on the cylinder side?

Okay. Thank you. First of all, the announcement came up prior to ACT Expo, and we were well aware of that joint venture. It's not Cummins, it's a joint venture which Cummins has about their interest in the space. Nevertheless, what I see, we know the market. We know the technologies which are out there. And as I said before, we have the technological capabilities. We have the capacity.

We have the productivity in our systems built, and we have now the right cost base to tackle it. And we've been in this market since decades, and we have seen competitors come and go. And we are still here because our mission is really to replace diesel with an alternative fuel for heavy-duty long-haul, high energy-intensive mobility applications. And I think we are well positioned and seeing competition entering the market showing interest is a testimony that something is changing.

Something is changing in regards to the adoption and the move away from diesel for these mobility applications. And we've seen this also with announcements coming from Volvo and Westport who wanted to enter the U.S. market. So these are all good signs for us for the future, paired with the support which we see in the industry from a regulatory side with EPA '27 to really improve or require higher NOx standards, which natural gas can fulfill where diesel needs [ an after-gas ] treatment.

Question for you, Eirik. Given you delivered NOK 57 million EBITDA in Q1, why are you conservatively guiding NOK 200 million for the year?

Yes. No, good question. I think Q1 was a solid quarter, probably on the high side of what we expected some months ago. Very pleased with the results, especially on the cost side. But that said, we continue to see volatile market conditions. We have limited near-term visibility, particularly in some of our more cyclical end markets, smaller pipeline and also on the truck side. So I think our indicative guidance here reflects that uncertainty and the fact that we also see some risk related to input costs from the conflict in the Middle East, which we, as said, we are monitoring and managing very closely.

So it's a mixed picture. We're encouraged by the underlying trends we're seeing in the market. We are very encouraged by the performance on the cost side. So our guidance here is intentionally prudent, and we feel relatively good about this number. And yes, I think this allows us to manage the business responsibly, but also retain an upside if market momentum continues to build through the year.

Continue with another question for you. What is the plan to become, and when do you expect to be cash flow positive?

Yes. No, I mean, we're working on several levers to improve cash flow. And I think we have proven in the past that our core business has strong profitability potential. We do expect higher market activity in the years ahead. We do expect more diversification, as Philipp has talked about today and as we have talked about earlier, which will drive the top line.

And with a leaner cost base following the cost actions that we have implemented in 2025, we're better positioned to deliver more profitable growth. We are, as also mentioned, relatively well invested. We have a few years behind us now with relatively high investments. We have also -- we also have an intention to reduce our inventory and free up working capital. And with the delevered balance sheet and lower interest cost, we -- I think that all these add up to what we believe to be a healthy cash flow generation potential over the next years.

I have one more question for you, Eirik, on the currency swap. Can you elaborate on the currency swap and why it was not listed as part of the NIBD?

Yes. So currency swap, it is disclosed in our annual report and quarterly report. It's basically a hedging instrument, the derivative we have on our balance sheet because our operating currency is in U.S. dollars, but our loan is -- our term loan is denominated in NOK. So we've had that instrument now for 5, 6 years, and it fluctuates with the FX rate. And we -- it expires in Q4 2027.

So it's a reliability that has to be cash settled. So for us, we wanted to reduce the refinancing risk of that and rather consolidate everything into the term loan and do the hedging through USD-denominated term loan. And of course, this is a bit detailed and technical topic, but I'm happy to take questions also offline on this for those who are interested in this.

One more question for you, Philipp, on prebuy of diesel trucks. Is there any signs of the fleets that have prebought diesel trucks for the 2027 EPA deadline switching their orders to CNG trucks after the Iran shock?

So it's a very good question. It's like what we see currently, the U.S. has a very differentiated or North America trucking has a very differentiating picture. If you take orders, orders are currently outstanding, indicating that fleet dealers are securing build slots later in the year.

On the other hand, we see sales numbers who are, to some extent, below of last year's numbers. So what we see is that currently coming also out of ACT Expo and talking to my team and reviewing the commercial activity that we have increased quoting activity. And this makes me, as Eirik also stated, cautiously optimistic for this year. And we see that the interest in CNG to replace diesel as a base fuel for heavy-duty long-haul, high energy-intensive mobility applications is really there.

What we see is that the uncertainty, as Eirik alluded about in the risk is still there. We cannot neglect that, and we are now working on, yes, converting our quoting activities into orders.

There are no further questions from the audience. So that will conclude our Q1 trading update. Thank you.

Thank you very much.

Thank you so much for dialing in.

Good morning, everyone, and welcome to Hexagon Composites Q4 and Full Year 2025 Presentation. My name is Berit-Cathrin Hoyvik, and I'll be moderating today's presentation.

Joining me in the studio today is our CEO, Philipp Schramm; and CFO, Eirik Lohre. They will take you through our company update, financials and outlook before we wrap up with the Q&A session. With a reminder that, you may submit questions on your screen at any point during the presentation.

And with that, I'll hand the word over to Philipp.

Thank you so much, Berit-Cathrin. Good morning, everyone, and thank you for joining us for our Q4 and full year 2025 results presentation.

Before we begin, I would like to extend a warm welcome to Eirik Lohre, who stepped in as our CFO. Eirik has been a core member of our executive team for the past 4 years, and he has a strong understanding of our organization, and I'm really happy to have him by my side today, and he will walk you through the financials shortly.

For now, I will guide you through the key developments of the quarter. Q4 can be summarized as a quarter of improving performance, strategic progress, and early signs of market stabilization from the continued softness in our core North American markets.

Let me start with an update on the market environment, because it continues to set the backdrop for our performance. In 2025, our core markets in North America have been characterized by macroeconomic uncertainty, regulatory flux and low investment appetite. Those dynamics alongside low oil prices and high interest rates, delayed investments by customers, especially in our North American Mobile Pipeline business.

In the United States, the trucking market and freight rates remain at multiyear lows. Fleets are deferring replacement cycles despite aging fleets, and now the length of this downturn is unprecedented.

It is unfortunate, but not unsurprising that in this environment, fleets have limited willingness to adopt new technologies, even when the economics and when environmental benefits are compelling.

However, November brought an important shift. The confirmation or better, the reassurance of the existing EPA 2027 NOx emission rule has brought much needed regulatory clarity to the industry.

Class 8 truck sales saw a positive reaction in December and January's sales numbers. While this does not yet mark a market rebound for us, it is a meaningful signal that the pieces for recovery are starting to slowly fall into place. This regulation also provides important clarity for fleets and incentivizes the shift towards CNG from 2027 onwards.

So overall, while the market conditions remain soft, we are seeing signs of gradual stabilization. These signs of gradual stabilization are evident in our Q4 results, where we delivered sequential revenue growth and improved profitability.

Our revenues increased to NOK 831 million in Q4, driven by the strongest quarter of the year for our Fuel Systems business, including strong performances by Refuse and Transit, which again proved their resilience.

EBITDA was for the quarter at NOK 156 million, which included NOK 13 million in severance costs and a one-off accounting gain of NOK 119 million from the acquisition of SES Composites. We completed the acquisition in October. And since then, SES added NOK 97 million to our top line and NOK 4 million to our EBITDA. And we are expecting more financial synergies to materialize in 2026 from this acquisition.

This acquisition solidifies us as the leading cylinder and fuel system supplier to European transit bus OEMs. For the group, the quarter's underlying profitability trends, stripping out one-offs, reflects the progress of our cost cash optimization program, which is now well underway and on track. Since launching it in Q3 of last year, we have delivered meaningful progress across operating expenses, working capital and our portfolio.

The highlights of the actions that we have delivered so far are, a targeted 25% reduction in workforce/headcount, the optimization of our production footprints, shifting patterns and equipment usage, a reduction of around NOK 200 million in personnel and SG&A costs so far, including NOK 100 million in structural reductions. You will see a reduction in our Q4 numbers on working capital and can expect to see further reduction of between NOK 100 million to NOK 150 million in 2026.

We are applying strict investment discipline and have limited CapEx in 2026 to NOK 80 million, with no noncore cash investments planned throughout the year. The positive momentum and visible progress of these measures are evident, and we expect further effects to build through 2026.

Importantly, I want to make clear that these are not short-term fixes. They are structural improvements that will benefit us in the soft market, but also as the market responds. The structural breakeven point of our business entering 2026 is now significantly lower than it was a year ago.

With our cost structure improved, growing and diversifying our top line through this market down cycle has also been a focus of ours since I joined the company a year ago, with a clear goal as a technological leader with unmatched capabilities to apply them where possible. There are many commercial developments over the last year, and especially the last quarter that prove this change and have set us to be a stronger and more resilient business.

One clear highlight is the outstanding performance of our Refuse segment in Fuel Systems. In 2025, we delivered record annual revenues of around NOK 800 million from the refuse industry. Refuse is a resilient market. It has stable demand tied to public sector backed critical services, so has been relatively unaffected by the macroeconomic environment in North America.

Trash still needs to be picked up. And in many cases now, this trash which is being picked up by refuse company is now turned into renewable natural gas and used to fuel these very trucks that collect it. It is one of the strongest circular economy use cases with major sustainability and economic benefits. It is enabling refuse companies to produce their own fuel and remove the single largest historical OpEx cost, which was diesel.

One of the reasons we are so confident in the outlook for natural gas vehicles is because of the conversion that has happened within refuse in North America over the last decade. Our team has spent 2 decades building this market together with the industry's trailblazers.

Today, 60% of new Refuse Truck orders in North America are natural gas powered, a clear validation of this long-term conversion story.

Our team is working on that same conversion story in heavy-duty long-haul trucking. For the first time, North American heavy-duty long-haul fleets have a real alternative to diesel. Natural gas is cheaper. And with the Cummins N15X engine, this engine delivers diesel-like performance without compromise.

In the last month, we received a significant order from a leading truck operator in Mexico valued at approximately NOK 110 million. The fleet tested the performance of the pilot trucks in their real-world operations, and this major order is a testament to how well it performed, driving coast-to-coast across Mexico.

More recently, yes, actually, it happened last night. We signed a PO and unlocked new opportunities for our business in securing our first commercial order for space applications, valued at slightly over USD 7 million. While it is a first order, is a strong proof of Hexagon's industry-leading high-tech capabilities.

We have unmatched capabilities within our business that truly do set us apart, and I want to personally recognize our engineering and our production teams for their exceptional work over the last weeks to make this happen. Their agility, unparalleled expertise and innovation continue to open the door to new verticals and other opportunities like this one for our business. This is a testimony of how we are walking the talk.

Across the group, we are committed to utilizing our capabilities, products capabilities, capacities and assets to create shareholder value, whether in new markets, new geographies like India or new industries like space.

With that, I will hand over to Eirik to take you through our financial performance in more detail. Eirik, please.

Thank you, Philipp, and good morning, everyone.

Starting with the financial results for the group. We delivered revenue of NOK 831 million for the quarter and NOK 2.9 billion for the full year. Q4 is a seasonally strong quarter, and we saw higher activity across most segments, driving a 50% uplift versus Q3 and including a NOK 97 million contribution from SES Composites, which was acquired in October. Organically, our quarterly growth was 37%.

Full year revenues for 2025 were significantly down compared to 2024, reflecting weaker demand, in particular within our Mobile Pipeline segment.

Reported EBITDA improved from minus NOK 54 million in Q3 to NOK 156 million in Q4. However, this includes a noncash accounting gain of NOK 119 million booked as other income in our accounts, which is related to the SES Composites acquisition, as Philipp mentioned. This is simply due to the fact that the booked value of the company exceeded the purchase price.

Adjusting for this and for severance cost of NOK 13 million in the quarter, adjusted EBITDA was NOK 49 million, corresponding to a 6% margin.

Profitability-wise, Q4 was the strongest quarter of 2025, supported by cost actions implemented throughout the year. And for the full year, adjusted EBITDA was NOK 65 million, corresponding to a margin of 2%.

Turning to Fuel Systems. We delivered revenues of NOK 548 million in a seasonally strong quarter, including a significant contribution from SES Composites. The full year revenue of NOK 1.8 billion was weighed down by lower truck volumes due to a muted freight market through the year, driven by regulatory uncertainty, tariff concerns, and weaker consumer confidence.

Towards the year-end, we saw a pickup in activity driven by improved clarity on the factors mentioned earlier by Philipp as well, including the EPA 2027 NOx rules.

For the quarter, we delivered some sizable orders, notably 100 sleeper cab systems, our largest configuration to a leading Mexican trucking company, contributing significantly to both top line and margin.

The Refuse business is one of our more resilient segments and continues to perform well, closing the year with record annual revenues of NOK 800 million, as Philipp also touched on earlier.

EBITDA came in at NOK 61 million for the segment, corresponding to 11% margin, driven by volumes, a favorable mix and improved materials efficiency.

Mobile Pipeline had revenues of around NOK 200 million in the quarter, significantly down year-on-year, but more than double Q3 levels. In North America, this segment has, after years of strong growth, experienced a pronounced cyclical downturn in 2025, driven by lower shale activity and slower build-out of RNG projects, which in turn has led to lower asset utilization and delayed CapEx decisions among the Mobile Pipeline operators, which are our customers.

We did see a small spike in demand ahead of the winter season in Q4, but this is also offset by some increased price pressure from competition given the market situation.

On the positive side, our EMEA business delivered record revenues of around NOK 100 million in Q4, driven by RNG projects in the U.K. and CNG projects in the Middle East, including the Watani business that we have previously announced. And while activity and EBITDA improved quarter-on-quarter for the segment, the Mobile Pipeline segment is still below the point of financial breakeven.

Aftermarket, our service and testing and inspection business delivered revenues of NOK 105 million for the quarter and NOK 433 million for the full year. Performance was down year-on-year, reflecting lower truck volumes, which means lower installation revenues for our aftermarket business as well as delayed maintenance and extended service intervals among the CNG fleet operators.

As expected, 2025 was a low activity year for MAE trailer requalification. Remember, this follows regulatory requalification requirements from the U.S.

Department of Transportation on 5-year intervals with 2015 and 2020 being low years for Mobile Pipeline, we knew going into 2025 that this will be lower activity for the MAE testing technology. And this also further impacted both our revenues and our margin for the year.

EBITDA was NOK 12 million in Q4 and NOK 28 million for the year, also weighed down by nonrecurring project work related to an LNG project we have now completed with the Cryoshelter technology.

Turning to cash flow. We delivered positive operational cash flow for the quarter, supported by improved EBITDA and the working capital release Philipp mentioned earlier in the presentation, which amounted to NOK 37 million for the quarter. In addition, we had some tax effects and other noncash add-backs to EBITDA, bringing the total up to NOK 102 million.

On the financial side, under investments to associated companies, we provided the last major funding to Cryoshelter in December to complete the work related to the major customer order that business has carried out before the ownership has since been restructured from January 2026. This involves Hexagon taking 100% control and significantly reducing the cash burn of that business.

We are currently exploring alternative outlets for that technology that does not involve further investment from Hexagon, including deploying the technology in high potential markets such as India.

Including NOK 100 million of debt drawdown, we ended the year -- we ended the quarter, sorry, with NOK 104 million higher cash balance.

Briefly on the balance sheet, which remains sound following the capital raise in September. Net debt remained slightly above NOK 1 billion in Q4, broadly in line with last quarter, and our net working capital stood at close to NOK 1.2 billion. And as Philipp mentioned earlier, we are working diligently to address that number. Our available liquidity stood at NOK 561 million at year-end, and we had an equity ratio of 50%.

And to round out the finance section, I wanted to briefly touch on the covenant situation. As previously disclosed, the September refinancing included a waiver for the leverage covenant until Q3 2026. And from that point on, the covenant will be reinstated at 4.2x EBITDA.

In an uncertain market, management remains laser-focused on financial discipline, cost control and working capital management in order to meet the obligation of the loan agreement.

And in parallel, we're also maintaining proactive and ongoing dialogue with our lending partners to ensure appropriate financial flexibility in the short-term, but also a sustainable capital structure in the longer-term.

And with that, I'm handing it back to you, Philipp, for the outlook section.

Thank you, Eirik. Looking ahead to 2026, while Q4 2025 delivered encouraging improvements, we remain a back-ended loaded company. We expect many of the market headwinds that shaped 2025 will continue to influence our core markets in the first half of 2026.

The key drivers and risks affecting our business segments entering this year, however, led me to be cautiously optimistic about 2026, where we see both potential upsides, but also potential downsides.

For Mobile Pipeline, there's still an unfavorable supply and demand imbalance in the North American market, as Eirik explained. Traditionally, oil and gas customers are focusing on utilization rather than exploration and expansion. This tougher environment is also leading to increased pricing pressure from underutilized competitors.

On the flip side, we expect there to be multiple drivers of demand for Mobile Pipeline solutions in 2026. We have new product developments, and we have improvements scheduled to launch in 2026 that make me personally optimistic we will capture relevance in new industries.

We also have opportunities in new geographies and for applications in markets like India, Latin America and for applications for data centers that may drive volumes.

For Fuel Systems, on the risk side, Class 8 truck volume sales are still projected to match or even be slightly below the very low levels in 2025. Despite a significant improvement of projections from ACT over the last 2 months. In our view, the weak freight rates in North America may keep fleets conservative on CapEx and rolling stock investments.

November's confirmation on the very important EPA 2027 NOx emission law will stand. This is good news. It will come in effect on January 1, 2027, and may lead to a potential prebuy effect on diesel trucks before the tailwinds of those same regulations positively support CNG and our business from 2027 onwards.

The positive flip side of the EPA 2027 regulation and confirmation is clarity. We have been waiting for this final confirmation that the law would not be reopened.

With that certainty, we are already hearing from fleets that they are more comfortable committing to buying new trucks, investing and looking into CNG. Now it's on us. We need to turn interest into orders.

Alongside improving market fundamentals, we expect that larger fleets may look to transition to commit, make orders in the second half of 2026 as they grow more comfortable with the new technology.

For transit buses, we are seeing positive CNG momentum in Europe and the Americas with governments and municipalities committing to CNG as the best solution for their fleets and cities.

Another potential driver of revenues would be a pickup of additional business in adjacent industries, like space, with further progress on our diversification strategy taking effect.

For aftermarket, we expect that an extended soft truck market will limit parts and install volumes on the risk side, offsetting that on the driver side, we are expecting strong recovery for Hexagon Digital Wave in 2026.

As Eirik mentioned, Mobile Pipeline requalification activity is expected to rebound from the cyclical low 2025. Broader product and geographical expansion in Mobile Pipeline and Fuel Systems could also open new aftermarket opportunities for sales and increased profitability.

To summarize, our core markets, especially in North America, look to be relatively soft in the first half of 2026, with a return to normal seasonality and back-end loaded year. Based on current visibility and continued market uncertainty, we expect our 2026 top line to be broadly in line with or moderately above 2025 levels.

With improvements in profitability, we see across all segments, the value proposition of our core technology and capabilities remains firmly intact. And with the improved cost structure, we are more competitive.

As we enter 2026, our priorities are clear, and they reflect both the current environment and our long-term ambitions. We will have strict financial discipline. We are focused on leveraging the core technology and capabilities that differentiate us and that have made us the market leaders in our industries for decades. And we will drive the adoption of natural gas vehicles as the only alternative to diesel in long-haul, heavy-duty and high energy-intensive mobility applications.

Our cost and cash optimization program is delivering structural benefits, and our strategic steps are bearing fruit. We will have a European footprint improved. We are gaining traction in diverse new verticals and geographies, and have greater regulatory clarity that meaningfully benefits natural gas adoption.

While we are expecting a modest first half of this year, we are cautiously optimistic for 2026 and remain confident about our long-term growth.

With that, I will hand back to Berit-Cathrin for the Q&A session. Thank you so much for listening.

Thank you, Philipp. We already got some questions from the audience, and I'll start with the first question for you, Philipp.

On the aerospace order announced this morning, can you provide additional color on the nature of that opportunity, and how we should think about its potential to develop into a meaningful growth avenue for Hexagon?

Okay. For us, as I stated, this is a testimony twofolds. One, about our capability and that we walk the talk, and let me come back to that. Walking the talk was important that we are becoming more resilient. That's a testimony looking in adjacent industries.

The second is a testimony of our capabilities, of our teams who can drive and bring this home, the capacity we have, and the product we have in place. And that a very challenging environment, very challenging customer is accepting this and that we, with the team are driving this home over a relatively short period in time, as I stated, makes me confident that we can explore other opportunities in adjacent industries.

Continuing with a question for you, Eirik, on profitability. What do you mean by meaningful improvements to profitability? And what material and nonmaterial savings impacts do you expect in 2026?

All right. Thank you. I appreciate the question. I'll not give a number, but I think we have some levers that will contribute. Firstly, it's the full year effect of the cost actions we have implemented in 2024. As Philipp mentioned earlier, and as I also mentioned, we expect the effects to linger on into 2026.

Second lever would be the acquisition of SES Composites. We already communicated that we expect to see some synergies from that transaction on the administrative side and operational side, but also on the sourcing side.

And the third lever would be general operational and material efficiency that we see throughout the course of the year. So I think we're pretty confident in a step-up in margin from 2025, which was a low level, 2%, but not to the extent of 2024, which was at 13%. At the end of the day, we are depending on certain volume to absorb cost.

Moving more over to commercial and you, Philipp. Regarding the synergy with engine partners, your partner, Cummins, has recently highlighted the massive growth in the data center sector as a key driver for backup and standby power demand.

Given Hexagon Agility's leadership in high-pressure gas fuel systems, do you see a strategic opportunity to provide the storage and distribution systems required for large-scale gas-powered stationary power generations in this sector?

Absolutely. And also, with that question, multiple dimensions are unfolding here. One is our value proposition, lightweight, high density, a lot of payload of natural gas on a vehicle. That is efficient for the gas transportation companies.

And now it comes to the need of a lot of energy with data centers. And this works perfectly together, and this is where we work closely together with our partners in the gas distribution industry to see what they need, what their product demands are, what changes potentially need to be made. And we anticipated this already during the course of 2025, as I stated, that we make product improvements. We're looking into new product offerings within Mobile Pipeline to serve these industries in the most efficient way.

Moving back to you, Eirik, and a question on covenants. You mentioned in your report that you see a risk of covenant breach and are in dialogues with banks. How advanced are you on this? Will you be able to get a waiver? Or do you foresee an equity raise will be needed?

Yes. No, thanks for the question. And as said during the presentation, we have done and we are doing everything in our power to stay in compliance with the obligation of the loan agreement. We are addressing costs. We are addressing working capital. We're minimizing discretionary spend, CapEx.

I think we -- as Philipp mentioned as well, we are cautiously optimistic about 2026. We do see improvement in profitability, but it would also be wrong given the market uncertainty for me to kind of categorically rule out a risk of being in a potential technical breach. But of course, we are on top of this situation, and we're doing what we can. At the end of the day, we are depending on a certain uptake in the market.

And I can also say, as mentioned during the presentation, that we have a good and constructive dialogue with our lending partners. And most importantly, we do also have a solid liquidity situation. And we also, as mentioned in the presentation, expect positive cash flow in 2026.

So yes, that's what I can say about that. And of course, we will do whatever we think is in the best interest for our shareholders, both in the short-term, but also in the long-term.

Philipp, a question related to our third quarter presentation. In the third quarter presentation, you said that the first quarter would be weaker than the fourth quarter results. Do you reiterate that message or have anything changed?

No, I think, I've been very clear that based on the visibility and the uncertainty we see in the current market and the shifting dynamics here that we believe that 2026 will be a more normal year based on seasonalities, meaning that the first half might be softer and the second half might be stronger. And that is in alignment with what we hear from other market players and what they see as well. And this is how we manage our business at the current moment.

Moving back to you, Eirik, a question on SES acquisition and how it relates to covenants. Will the gain on SES acquisition of NOK 119 million in EBITDA contribute to the EBITDA as defined in the loan agreements, and thereby contribute to fulfill the EBITDA covenant in the third quarter of 2026?

Yes. Good question. I think as a starting point, the definition of EBITDA under the lending agreement is intended to reflect underlying performance and cash generation. That's the starting point, but we are having discussions along multiple fronts with the banks. So I would, for now, assume that it will not count in the definition of EBITDA. But as I said, there are discussions along different fronts on this.

Question for you, Philipp, on Europe. Do you consider the increased defense build-out in Europe to be an additional upside for the Fuel Systems business? If so, how do you assess the potential?

I think it's a similar question then to our aerospace business. We have and we have capabilities which can be used in all different industries, also the one you just mentioned. And it's like one of our endeavors to see and take opportunities as we can deliver them from our sites in the U.S. or in Europe.

So we are open to these discussions with the capabilities we have, the product portfolio we are -- we want to utilize and the capacity we want to utilize as much as possible.

Then I think, let's see many questions coming in here. Eirik, a question for you on annualized cost base for 2026. What is your approximate annualized cost base for 2026, G&A and personnel costs?

Can you repeat the last part of the question?

It says approximate annualized cost base for 2026, G&A and personnel costs.

Yes. I guess we -- I think our fourth quarter is pretty representative for what we will have in 2026. So that's what I can say about that. Again, we expect to have some improvement. So that's a good baseline. But building on that, we should see some improvement.

Philipp, on Mobile Pipeline, do you see the EMEA region driving the sequential mobile pipeline growth going forward? Or is it still dependent on improvements in the North American market?

For Mobile Pipeline, we take every opportunity in all the regions. we were focused on the North American market with the downturn, which we are seeing, we are deploying all our resources in every region of the world.

So it's not just Europe, Middle East, Asia, it's also South America. It's applications, as I said before, where you need a lot of energy and need to transport it from a point to another point. And this is where our value proposition come to fruition. And we are seeing a lot of positivity. We're seeing due to the geopolitical uncertainties, also changes in how people approach stationary gas -- pipeline gas distribution.

And there are some benefits in a lot of these industries, regions, countries where we can serve it. But we also see within our -- some of our core businesses like the RNG businesses, huge developments in countries within Europe, which are focusing on that as well. And so I think it's not a question to say yes or no. It's like multiple answers, and we take every opportunity we get.

Then we have several questions on the need for raising capital. So I'll just ask one.

Yes.

So for you, Eirik, are you in the process of raising capital in near future?

We cannot comment on that, obviously. And if and when, that will be the case, then we would obviously address that and communicate it. But I cannot comment on anything like that. What I said about the covenant situation earlier is still the reality. So we're working to find a solution.

Philipp, exactly what type of gas cylinders and tanks are needed for data centers?

I think our -- every one of our applications is unique and for a certain application. In general, our TITAN cylinders, TITAN trucks, TITAN modules are best in the utilization of space on a truck, in a module and with the application of payload, which can be transported. So our TITAN trailers would be perfect for that kind of application in comparison to some of our competitors' products.

I think what we see on data centers is that it's very common to deploy a temporary energy supply in absence of permanent infrastructure, while there is a rapid deployment or rapid build-out of data centers. So it's very, very common to see in the initial phase before permanent infrastructure is established. So just adding to what Philipp said.

Great. Thank you. That seems to be the questions for today. So that concludes our fourth quarter presentation. Thank you for joining.

Good morning, everyone, and welcome to Hexagon Composites Q3 presentation. My name is Berit-Cathrin Hoyvik, and I'll be moderating today's presentation. Joining me in the studio today is our CEO, Philipp Schramm; and CFO, David Bandele. They will take you through our company update, financials and outlook before we wrap up with a Q&A session. And with that, I'll hand the word over to Philipp.

Thank you. Good morning, everyone, and thank you for joining us for our Q3 presentation. Let's start with a high-level summary of the third quarter this year. The macroeconomic uncertainty continues to negatively weigh on our business and our core markets are in a cyclical downturn in combination with an unprecedented macro environment. This has significantly affected our volumes and our profitability this quarter, and our Q3 results are weak with group revenues, which came in with NOK 538 million and led to an EBITDA of negative NOK 54 million. August contributed to the majority of our Q3 EBITDA loss.

With our banking partners, we decided to initiate an equity raise to improve our balance sheet, and we have raised NOK 590 million. In September, we launched a group-wide cost savings program targeted at reducing our cost base, improving our EBITDA breakeven point and securing our liquidity.

I will come back to the results and details of this program in more detail shortly. In addition, we remain focused on executing the strategic steps that will drive the adoption of natural gas in North America and in Europe.

So let's take a closer look at how we are managing the current environment. First, let me give you some content to our current market exposure. On the one hand, our Transit, Refuse and aftermarket segments represent sectors that operate largely independently of the macroeconomic environment and typically have an uptick in tough times. This is exactly what we are currently experiencing with our Refuse business. These segments provide our business with resilient cash flows.

At the same time, Truck and Mobile Pipeline are cyclical by nature with higher sensitivity towards the macroeconomic environment. These are also the 2 segments which represent Hexagon's largest growth opportunities. For a deeper look into how these 2 cyclical growth markets are developing, I will explain some of the factors that are impacting Truck and Mobile Pipeline in North America. These 2 segments are currently operating in an unprecedented environment affected by a unique combination of external factors. Constantly changing trade and tariff policies have created a wait-and-see environment.

In our discussions with customers, as one example, the announcement and then the quick postponement of tariffs on trucks in September further delayed both spendings and projects. Shifting emissions regulations have had a similar effect. The current U.S. administration has created uncertainty on whether the existing emissions, regulations will hold or if other regulations will replace them. This too has caused fleets to sit on the fence.

But I do want to be clear, though, that from a regulatory perspective, the removal of the zero emission mandate has supported CNG as the alternative fuel solution to replace the base fuel diesel. The high cost of capital and lower shale activity due to low oil and gas prices are impacting the demand for Mobile Pipeline. Currently, Gas transportation companies have a strong focus on asset utilization in these high capital-intensive markets.

For trucks, the freight decline has spent now 4 years. Industry forecast for the Class 8 truck market in 2026 have dropped dramatically over the last few months. Fleets are more reluctant in this environment to adopt to new technologies and to incur higher upfront CapEx cost despite the positive total cost of ownership that CNG now delivers to heavy-duty fleets, thanks to the new game-changing 15-liter engine.

If these projections become reality, then we are preparing to navigate this environment. We cannot control the timing of recovery. However, actions that we are now taking will mean that we will be in a more profitable position in the future. So what does this exactly mean?

As a company, we are laser-focused on reducing our cost base through this down cycle. In connection with the equity raise in September, we launched a group-wide cost and cash savings program. It follows cost-saving measures that were already implemented earlier this year. In total, by the end of Q3 2025, we have reduced personnel costs by approximately NOK 190 million compared to 2024 on an annualized basis. Approximately NOK 70 million of this reflects structural annualized run rate improvements by the end of Q3.

As part of the ongoing program, we are delivering on additional measures and expect to see further effects in the coming quarters. We also see similar positive effects from other operating expenses. Beyond personnel costs, our investments are well below 2024 level and will remain that way.

In 2026, we will limit CapEx to a maximum of NOK 80 million for our core businesses. In addition, we have identified significant optimization potential within our inventories. A strategic focus on utilizing our existing assets and raw materials will contribute to a further NOK 150 million to NOK 200 million reduction in the first half of 2026. Improved payment terms will help us as well. As we have communicated in previous quarters, we remain focused on the core business and will have strict investment discipline.

We will continue to review how our current assets can create the best value for you, our shareholders. Despite the current environment, this unprecedented market will rebound. We remain focused on driving the adoption of natural gas vehicles, especially in heavy-duty trucking. While the pace of adoption has been slower than expected, we are proactively doing our part to drive the adoption.

In September, we formed a strategic partnership with Cummins and Clean Energy to launch Pioneer, an independent leasing company that is dedicated to mobility applications with alternative fuels. In addition, we launched our own demo truck program in October, enabling fleets across the United States and Canada to test how natural gas-powered heavy-duty trucks work in their specific and individual environment.

For fleets to experience the potential of these trucks in their specific environment is reducing the barrier and is essential to accelerate adoption. We are already seeing huge interest and confirmation from fleets that they are seeing savings, lower emissions and the diesel-like performance, which can now go hand-in-hand without any compromise.

In October, we also closed the full acquisition of SES Composites and will now focus on leveraging synergies in consolidating the European market. With a cylinder site in Poland and a valve manufacturing business in Germany, this acquisition further strengthened our position in the European Transit Bus segment.

With that, I will hand over to David who will walk you through the financials.

Thank you, Philipp. Good morning, everyone. On a group level, Q3 revenues were NOK 538 million with an EBITDA of negative NOK 54 million. That's after booking severance costs of NOK 9 million. The quarter was heavily impacted by the prolonged market uncertainty in North America. Volumes were lower across all segments and especially in Mobile Pipeline. As Philipp has confirmed, to mitigate the effects of these weaker volumes, we initiated a new cost savings program in Q3. We are laser-focused on our main priority, which is supporting liquidity through this down cycle.

In September, we proactively strengthened our balance sheet by NOK 590 million and negotiated an updated bank agreement. We are already seeing the effects of positive working capital releases, and these efforts will continue to become more visible over the next 2 quarters. Headcount reductions totaled approximately 20% as of the end of this quarter compared to 2024 levels. And in light of the market conditions this year, this cost savings program is delivering results with more to come.

Now let's look at these results and their drivers in more detail segment by segment. In Q3, our Fuel Systems segment generated NOK 372 million in revenues, weaker than the third quarter of 2024, which was bolstered by deliveries to the large UPS order received in the back end of 2024. The Refuse sector has been incredibly strong in 2025 with continued year-over-year growth in Q3, albeit at slightly lower volumes than last quarter's record performance. Transit delivered steady volumes with deliveries to multiple municipalities, including the large previously announced order to Dallas, Texas.

As expected, the Refuse and Transit sectors continue to deliver a stable baseload of demand even amid the current market uncertainty. For the segment as a whole, the EBITDA margin in Q3 came in at negative 4% due to low truck volumes impacted by additional tariffs and further market uncertainties.

Now over to Mobile Pipeline, which remained under pressure with continued impact from broader market uncertainty in the quarter. Lower shale gas activity and falling LCFS and RIN credit prices are resulting in customers halting their CapEx spending. With new investments being limited in our core energy end markets, including oil and gas and renewable natural gas, module utilization is being favored by our largest customers who are employing a wait-and-see approach.

In North America, this demand halt has resulted in a significant decline in profitability that has impacted group margins. Revenues for the quarter were NOK 93 million with negative margins of 49%. Now outside of North America, the results delivered remained steady compared to the prior quarter.

Now moving to our Aftermarket segment, which is our most resilient segment. Aftermarket delivered steady revenues of NOK 97 million in Q3 on par with the same quarter last year. Our Parts and Services business delivered solid volumes in the quarter across both FleetCare and Hexagon Digital Wave. Profitability, while stable, came in lower at 8% EBITDA margin due to an unfavorable mix of internal services and one-off charges.

As mentioned previously, 2025 has been a known down year for our modal acoustic emissions technology. At these low levels, the unit actually delivered close to EBITDA breakeven this quarter with cylinder inspection and testing activity picking up in 2026 as the 5-year requalification cycle reaches their next annual milestone. And to counteract and navigate the headwinds, we're experiencing in our cyclical businesses and with continued uncertainty on the timing of demand recovery, we are accelerating our actions on 3 targeted major themes.

The first one, key, preserving liquidity through 2026 and beyond. The second one, lowering the breakeven point of our group operations through significant indirect and fixed cost reductions and then in turn, lowering our reliance on demand recovery. And the third, as you've heard from Philipp, increased measures to stimulate the adoption of natural gas transportation in North America, Europe and the rest of the world.

As an extension of these actions and to strengthen our balance sheet, announced in September, our refinancing arrangements with the banks have resulted in a suspension of leverage covenant testing up until Q3 2026, at which point, the target will be 4.2x on that quarter based on net interest-bearing debt divided by the last 4 quarters rolling EBITDA with some allowance for certain one-off adjustments. The steep falloff in demand that we have experienced in 2025 has significantly reduced our EBITDA levels and made it technically difficult to show normal leverage until EBITDA levels are steadily built up again over time.

In light of this development, we secured a covenant holiday to counter that difficulty and the relevance of the test in such situations. As a condition, our banking partners implemented a conditional reduction in debt levels, commitments and availability. A capital raise was a necessary condition to secure this flexibility and was successfully executed in September, again, raising NOK 590 million.

Key changes to the financing facility are described in the Q3 report and include a total facility reduction by NOK 200 million down to NOK 2 billion, of which NOK 1.6 billion is fully accessible and NOK 400 million accessibility is dependent on leverage being less than 2x. Also, that NOK 400 million will be reduced to NOK 200 million progressively through 2027. You also see the reduced covenant levels shown and also introduced a minimum liquidity requirement of NOK 200 million.

I will also note that M&A investments and financial support will be subject to the lenders' consent. These updated terms alongside the capital raise have strengthened our balance sheet. While July trading performance was around about breakeven levels, August results generated losses with continued weakness in realized mobile pipeline sales versus our probability-weighted expectations. With the reduced visibility impacting both core businesses and increasing debt and leverage levels, a maximum capital raise under the authority of the Board was executed to ensure that we can best navigate these market headwinds.

Hexagon will continue to focus on responsible actions within our control, focused on balance sheet resilience as we face these uncertainties in our markets. Here, we illustrate the impact ranges of our additional cash flow and profitability initiatives for the 4 quarters through to that important milestone of Q3 2026. These are split between balance sheet and profitability drivers.

On the balance sheet side, we expect between NOK 150 million to NOK 200 million in working capital reductions as we intentionally reduce our built-up carbon fiber raw materials and other key inventories through negotiated pauses in purchase commitments and, of course, a pull-through of sales. We can reduce CapEx in the short term by a further NOK 50 million to NOK 80 million from an annualized run rate of around about NOK 130 million but we should not hold to those levels in 2027. Interest costs can be reduced by NOK 20 million to NOK 30 million with benefits from the reduction in our absolute debt levels.

Of the NOK 150 million cost saving target disclosed in connection with the cap raise in September, an estimated NOK 70 million of positive run rate effects have already been realized by the end of quarter 3, and we expect to realize the remaining NOK 80 million over the coming quarters. We are also actively working on that additional ambition of NOK 50 million communicated in September, which would give us a range then of NOK 80 million to NOK 130 million over the next 4 quarters.

Total potential cash improvement is as shown and both before any additional cash generation from sales. Again, I'll reiterate, these are before any additional cash generation from sales.

So in summary, we expect to reduce our interest-bearing debt levels over the next 4 quarters. While our cost savings initiatives will give a good boost to EBITDA, we will also be dependent on sales and mix developments in the year ahead. We, therefore, need to keep laser focused to hit our covenant target at Q3 '26, which technically is highly sensitive then to the EBITDA development. Hexagon has a market-leading position and a history of profitable growth, and the market will recover over time. We will, of course, keep close and continuous dialogue with our banking partners in this period.

And with that, I'll hand it back to Philipp to share more on our outlook.

Thank you, David. So let's turn to the outlook. Overall uncertainty continues to provide limited visibility on how quickly the market will rebound. But we are confident that Q4 will come in better than this quarter with several orders being delivered during the fourth quarter of this year. Our cost-saving program will also have a growing positive impact over the next few months and will improve our margins. Beyond Q4, we will continue the delivery of our strategy.

Entering 2026, our visibility beyond our current backlog is limited for our cyclical segments. Our aftermarket and public service segments of Transit and Refuse will continue to provide a baseload of relatively stable cash flows. However, based on our experience and market seasonality, we expect the first quarter of 2026 to be a weaker one. With our cost savings program, we are focused on our cost optimization program. We will deliver efficiency improvements alongside this. This will bear fruit.

We have a sound liquidity position, as you have heard, and active cost management will help us as well. And that means despite the current market softness, our growth ambition remains firmly intact. We see 3 major drivers for when our markets will rebound. The first driver is the U.S. Class 8 truck market is at a cyclical low with an aging fleet. Those truck assets will need to be replaced at some point in time. The fact underpins recovery will happen, but the time line and how quickly they get replaced is largely dependent on the macroeconomic situation and how fast freight rates recover.

The second driver of our cyclical rebound is pure economics. Natural gas is the only cost-effective and widely available solution to decarbonize long-haul trucking, and it offers an economic payback over traditional diesel trucks. The third driver lies in the positive signals from fleets. The X15N is changing the game, and it is expected to unlock CNG adoption. In talking to fleets and seeing the positive response to our own demo truck program, we are very confident that this technology will scale.

The industry ambition remains unchanged at 8% to 10% CNG adoption of Class 8 trucks. In addition to these drivers, we are focusing on key strategic priorities. Driving the adoption of natural gas vehicles is one of those strategic priorities. We are also actively working to broaden our geographic and end market exposure with a purpose of smoothing the current cyclicality and growing our business. Our current opportunities represent market entries, which require limited capital that again can provide us with additional volumes and broaden our market exposure.

So it remains a question of when, not if this market cycle rebounds. And when it does, we as the market leader for natural gas fuel system with then an improved cost base, we are in the pole position to capture growth more profitably. So to sum it up, our key markets on a cyclical downturn that is being compounded by overall macroeconomic uncertainty.

We are, as Hexagon, doing our utmost to weather the storm and remain focused on driving further cost reduction and cash discipline to secure our liquidity and improve EBITDA breakeven. We remain confident in the long-term growth of Hexagon. That growth story is firmly intact, and we are taking measures to both accelerate the adoption of natural gas and diversifying our geographic, customer, product and end market outreach.

With that, I will hand back to Berit-Cathrin for the Q&A.

Thank you, Philipp. We'll start with the first question is for you, Philipp. How have you managed to get in this situation? Shouldn't you have started to cut costs a lot sooner? And what signals are you getting from customers on orders?

Okay. Thank you for that question. Since I started, we started to adjust to changing market dynamics. Already in Q1 and Q2, and as I also communicated, we have reduced the cost base. Nevertheless, with the weak results of August, we have taken one of our negative scenarios and initiated more. That was the start point of this major cost reduction program to preserve liquidity, improve our EBITDA level due to the fact that we are seeing more and more fleets are being on the fence, the wait and see to respond to the macroeconomic uncertainty and this unprecedented downturn in trucking in the United States.

Nevertheless, the uncertainty is in the market. I cannot deny that. But our growth story is intact. CNG is the only alternative now to replace the base fuel diesel for heavy-duty trucking in the United States. So the growth story is intact. We're adjusting to the new reality. We're adjusting to a declining outlook. But I'm confident that we will weather the storm and come out of the storm stronger than we entered it.

I'll move over to you, David, a question on cash flow. Can you drag us through what the cash flow from investment activities relate to? What is included in the NOK 43 million of CapEx, the NOK 18 million in loan to Cryoshelter and the NOK 50 million in other investments?

Sure. So the NOK 15 million was a modest investment into Pioneer, a strategic relationship in order to boost adoption of natural gas trucks. On Cryoshelter, and Cryoshelter, remember, is a pre-revenue company. They're actually working on a contract also on a customer of ours. So we supported their ability to do so.

And then on CapEx, it's fair to say it's a normal CapEx that we have been -- that we need to do. But we also note that we've had quite a few ERP programs actually coming to conclusion in Q3. So moving to a cloud system, which has been successful globally for the company and also another ERP project within Digital Wave.

And then continue with you, David. Questions on SES. These 2 questions. So I'll start with the first. Could you please indicate the net interest-bearing debt you took on when you consolidate SES?

SES is a debt-free transaction, pleased to say.

Thank you. And the second, in round numbers, what will SES contribute to the Q4 numbers for EBITDA?

That's a good question. Obviously, when you do due diligence, we're not yet a feet under the table properly. But of course, as announced, it was reporting around about EUR 30 million in top line and around about EUR 2 million in EBITDA. So we will progress along that basis over the next few quarters.

And then also another one for you, David. Why did payroll increase from the second quarter to the third quarter in 2025? And the second, may we expect other operating costs to stay between NOK 100 million and NOK 105 million per quarter for the fourth quarter and 2026?

Yes. The other operating costs as disclosed in the report, that's a fair assumption from the ask of the question. On the other matter, it's just technical. So we have our long-term incentive program costs. We had a credit in Q2 and then more of a normal but reduced run rate in Q3. And that reflects the financial performance projections. So it's just some accounting between Q2 and Q3. One other thing. In Q3, we also booked NOK 9 million of severance cost.

And we will continue with questions on working capital also for you, David. You have more than NOK 1 billion tied up in working capital. Why are you expecting so little working capital release? And the second part of the question, are you committed to purchase some raw materials beyond 2026?

We -- of course, we have stated that we expect at least NOK 200 million. We do also expect market recovery in 2026. But yes, there's a good reason to take down working capital as much as we can.

We'll continue questions on Mobile Pipeline. There's 2 questions. So there's one for you, David; one for you, Philipp. So first, David, in your investor presentation in relation to the equity raise, you show Mobile Pipeline is not expected to reach 2024 levels before 2028. Why did you expand capacity by 50% last year?

The capacity program was essential also in terms of flexibility of operations. So we have quite a good program of new products coming online, and that gives us increased flexibility. There was also productivity gains, as we mentioned at the time. But at the end of the day, Mobile Pipeline delivered $40 million in EBITDA in 2024 for a $3 million to $4 million investment. We feel that's the right way to set us up also going forward. And of course, we did come into the year with elevated levels of backlog, which we successfully reduced.

And then the second part for you, Philipp, on Mobile Pipeline. You control 50% of the market according to the same slide. Do you not have a dialogue with your largest customers?

We do have a dialogue with every one of our customers. And as we stated, and I said multiple times before, is that customers within the gas transportation industry are highly impacted by the oil and gas prices, first for shale activities. On the other hand, the RNG side is impacted by lower credits, as we stated also in this presentation today. This is focusing these companies on asset utilization. And these discussions we are having. But one thing which has changed is now these customers are also truck customers. So every customer who has a CNG unit, one of our Mobile Pipeline trailers can haul these trailers with an X15N engine truck.

So we are combining this and approaching all of our customers with every of our product offerings. This is a change which we haven't had last year, and this is what we are moving forward with to offer our customers the entire portfolio, of course. And these discussions are ongoing [indiscernible] yes, unprecedented macroeconomic environment where there's a lot of uncertainty, where there's a lot of wait and see.

But if the utilizations and some of the uncertainty is going away, we see also their momentum from the discussions with our customers that this might change. But this is what we are preparing for. And as I said, we are doing our utmost to weather the storm, to improve our cost base, secure liquidity because we are prepared. We have the capacity to do so, and we can scale up. And as I said, it's not about if, it's about the when. And we trust in the market of 8% to 10% as every other industry player does of CNG adoption of the entire Class 8 fleet.

Back to you, David. Even with cost cutting of NOK 190 million, the Q3 covenant looks tight, implying revenue run rate must also come up. How do you see that happen with truck volumes weakening further?

Yes. Obviously, we mentioned the maximum effect we expect from the cost initiatives of up to NOK 130 million additional for the next 4 quarters. And the rest, as mentioned there, should come from sales, and that's a fair statement. So if you just repeat that question, sorry.

So even with the cost cutting of NOK 190 million, the Q3 covenant looks tight, implying revenue run rate must also come up. How do you see that happening?

Right. So in terms of the recovery, I think you heard it in the presentation that we believe the assets are close to being replacing -- being replaced on trucks. So we look for a truck recovery far closer than we look for a Mobile Pipeline recovery. In Mobile Pipeline, there's also split geographies. So North America is obviously our biggest. But we see promising increases in Mobile Pipeline in the rest of the world and Europe, particularly the Jordan contract, for example. So yes, so those are sort of brighter elements of potential recovery.

And then for you, David, also on working capital. The working capital reductions, is that relative to 3Q '25 level?

Correct. So on the slide, we presented additional cash P&L and the balance sheet initiatives. Those are all in addition to Q3 run rate.

And then we have a question for you, Philipp. Hexagon Purus will need more cash or be bought. Will you let anyone buy them? And what is the best case scenario with regards to Hexagon Purus as you see it?

I think it's an evaluation. And as I stated before, we believe that we have provided Hexagon Purus with enough liquidity to get through this challenging time. And as with every one of our minority share holdings, we are looking for opportunities to generate and improve shareholder value. So we evaluate situations closely as opportunities come by, and that's the same also with our shareholding in Hexagon Purus.

And then a question for you, David, on gross margin. Could you please elaborate on why the gross margin improved significantly from the second quarter to the third quarter?

It's a pretty technical answer, but I'm happy to maybe take that more offline. But of course, any improvement is good.

And that's a question for you, Philipp. Why are you so bullish on truck recovery when the data you're presenting shows further decline in truck orders in 2026?

Because I trust first in our case. Secondly, the numbers speak for itself. It's an unprecedented downturn in Class 8 truck decline in the United States. The age of the fleet is increasing. So at some point, there will be a turning point that trucks need to be replaced. And that makes me confident that this will change. And it's not me saying this, if you listen to other market players in this area, they are also seeing that there might be a change. But when it is, that's the question. And that's my role as the CEO of Hexagon Composites to prepare us for this.

That's why we have initiated the cost reduction program and the preservation of liquidity. And this is my goal that we are weathering these times and preparing us for the future because as I said before, the adoption in other markets for CNG is possible. So I truly believe why should it be different from our main market in the United States, where the regulations, as I said before, with the move away from the zero emission mandate is actually putting CNG in the spot to be the alternative to replace the base fuel diesel for heavy-duty trucking and heavy long-haul and high energy-intensive mobility applications.

And then a question for you, David, on backlog. Why do you not provide any order backlog information, which would really help outside shareholders close some of the information gap between insiders and outsiders?

Sure. I don't think it's relevant in the truck industry with the frame agreements, LTAs that we have. And it is a long-running question when it comes to Mobile Pipeline. We've chosen not to do that historically for those reasons.

Thank you. And then one question for you, David, on the cyclicality. Given the immense cyclicality you apparently are exposed to, should you ideally have financial debt at all?

It's a good question to have. But obviously, it's always a balance of your capital structure between equity and debt. So I'll leave it there.

And I think that we have one final question here from -- for you, Philipp, in terms of can you comment on new contracts and the pipeline for Pioneer?

For Pioneer. I cannot comment for our partner, an independent company. What we see and what I hear, there is interest, and it's the same interest which we see. As I heard, there might be something coming, but I cannot -- it's just speculation, and it's up to Pioneer to comment on that.

I think that concludes our presentation for today. Thank you for joining.

Thank you very much.