Ion Beam Applications Aktie

[indiscernible] First half of 2026. I am Thomas Pevenage from Investor Relations. As usual, you will find this presentation on the Investor Relations page on our website. The question-and-answer session will follow the formal presentation. Today's speaker Olivier Legrain, our Chief Executive Officer; [indiscernible], our Deputy Chief Executive Officer; and Catherine Vandenborre, our Chief Ventures and Corporate Officer.

Here is the agenda for today's presentation. We will start with the highlights for the period, followed by the business review where we will discuss the strategic progress and the financials of each business unit. Finally, you will cover our financial performance in more detail and give you an update on our guidance and outlook before opening the Q&A session.

Thank you, Tamara. Good afternoon, everybody. Let me start by sharing our key messages for today. 2026 confirmed that IBA is on track with its improved profitability trajectory, progressing on the execution of our strategy. We delivered a solid first half performance with growing revenue exceeding EUR 320 million and a substantial improvement in profitability reflected by an adjusted EBIT of EUR 17.6 million and a positive net result of EUR 9.3 million.

Commercial momentum was strong with equipment order intake up 64% versus same period last year, keeping our backlog stable at EUR 1.6 billion despite sustained conversion, combined with our expanding installed base and service activities, this reinforces our long-term growth engine. To support further this growth, our leadership team and Board have been strengthened.

Finally, we reiterate our '26 guidance of an adjusted EBIT of at least EUR 52 million, and we remain on track with the '24 to '28 outlook. Let us now have a closer look at the commercial dynamics behind these figures. On the equipment side, order intake reached EUR 176 million, thanks to IBA clinical, which more than doubled, driven by sustained adoption momentum in proton therapy with 5 rooms sold over the period. In IBA technology [indiscernible] systems also reflecting a slower start in Industrial Solutions, offset by a solid radiopharma demand. This kept our total backlog stable at EUR 1.6 billion of [indiscernible] up from services. The 2-year holding equipment book-to-bill stood at 0.9%, down from 1 at year-end given the sustained convection into revenue as we progress into the different projects.

On the financial side, the story is one of continued growth and improved profitability. Revenue increased to EUR 324 million, thanks to well-executed backlog conversion across segments. Adjusted EBIT amounted to EUR 17.6 million, a profitability improvement of EUR 7 million year-on-year. The adjusted EBIT margin increased to 5.4%, thanks to a gross margin improvement. We moved from 29.5% in H1 '25 to 33.7% in H1 '26 driven by a better equipment profitability mix and execution improvement in proton therapy.

Importantly, the net result turned positive at EUR 9.3 million. Net debt stood at EUR 81 million at the end of June, up EUR 23 million versus year-end, mainly reflecting working capital movement and timing effects. Our net leverage ratio closed at 1.14x adjusted EBITDA and the group retains ample access to its committed credit lines.

Before moving into the business review, let me briefly comment on the evolution of our leadership and governance. As IBA grows in scale and extend its activities, we have strengthened both the leadership team and above to support execution of our strategy. Henry has now assumed strategic and operational responsibility across the group including clinical, while Catherine leader our strategic partnerships and innovations.

For my part, I'm increasingly focused on the strategic steering of the group and was appointed by Chairman of the Board. Lastly, we have also welcomed Joy Hansen and Dr. Stephen Han to the Board, bringing extremely valuable expertise in sterilization, oncology, regulatory affairs and radiopharmaceuticals.

Let us now move to the business review. I will hand over to Henry, who will take you through both IBA Clinical and IBA Technologies.

Thank you Olivier, in the first half of 2026, IBA clinical combined strong commercial momentum, continued technological innovation and further operational improvements. On innovation [indiscernible] obtained investigational device exemption approval from the FDA in June, opening the way for our first in-human prime at the University of Pennsylvania. We also launched Adapt Insight XR, an emerging upgrade for the Cortez platform available for both installed and future systems. And in China, all 3 IBA sponsor studies met their primary endpoints and are progressing towards an IBA submission.

We also continue to improve operational efficiency across our growing installed base. This same availability remained close to 97% despite increasing workload reflecting the benefits of standardization, AI-enabled trouble shooting and our investment in [indiscernible] in those inventory market conditions remain challenging, particularly in the U.S., weighing on the revenue and profitability.

Nevertheless, order intake remains supported by recent portfolio launches such as [indiscernible] and continued momentum in proton therapy quality assurance. Our global footprint in proton therapy will now expand towards 93 sites after completion of all installations, an 11% increase year-on-year. At the end of June, IBA had 47 operational sites, well distributed across regions with strong visibility on future expansions as 46 additional systems are in production and installation, 11 installations were running simultaneously at period end or highest level to date.

In Spain, 2 systems are currently under installation and 2 additional projects are expected to start installation later in 2026. In China, we progressed further on major [indiscernible] projects with installation activities now completed, both in Chengdu and in Shenzen. The proton therapy adoption showed strong momentum in the first half with 16 homes sold globally compared to 2 in the same period last year, together with our partner, CGN in China, [indiscernible] 50% market share in this expanding market. More specifically, the 5 rooms sold by IBA, including 2 national first projects, 1 in Brazil and 1 in Portugal as well as 2 home projects with Duke University Health System, one of the leading academic health care system in the [ Europe ]. We continue to have the largest installed base in the market. This provides significant operational leverage and support of efforts to further promote proton therapy in collaboration with our clinical partners.

Increasing clinical evidence continues to be a key long-term growth driver for proton therapy. The pipeline is growing with 35 major Phase III trials now covering more than 10,000 patients across a broad range of indications. In parallel, we signed a sponsored research agreement within the [indiscernible] Texas and the health economics of proton therapy to strengthen the evidence base that supports reimbursement discussions and patients access. Despite the continued conversion into our new IBA clinical backlog was stable at EUR 47 billion. This was supported by the strong product that have the order intake with a 2-year equipment book-to-bill ratio of 1.2.

Service represented more than EUR 800 million of this total, not yet including the service contract related to the Spanish [indiscernible] project and 2 to 3 systems sold to [indiscernible]

Let me now focus on proton therapy continued profitability turnaround, adjusted EBIT reach EUR 12.3 million in growth compared with a loss of EUR 2 million in the first half last year. This reflects sustained revenue growth, improved execution and the increased scale of our installed base, while we continue to invest in key product innovation such as flash and dynamic [indiscernible]

Commercial momentum was equally encouraging with equipment order intake increasing to EUR 112 million. Turning now to Dosimetry, the first half remained challenging with an adjusted EBITDA of minus EUR 0.5 million. This reflects existent pressure in conventional radiotherapy and medical imaging, particularly in the U.S. which weighted on the top line, with net sales down 11% combined with a slower backlog conversion.

Encouragingly, order intake increased to 36 million supported by recent portfolio launches and continued momentum in proton therapy QA, the revenue generation from these orders is, however, more backloaded therefore, does not immediately offset the current revenue pressure. In parallel, the cost reduction measures announced earlier this year started to be implemented and are expected to progressively support profitability during the second half.

Let me now comment IBA Technologies. I will start with the strategic progress over the period covering industrial first and then Radiopharma solution. Industrial Solutions continue to progress around its road map, advancing accelerator-based realization and advanced irradiation solutions, order intake had a slow start as the market continues to digest the overcapacity created by the post-COVID investment cycle. Nevertheless, the commercial pipeline remains active with encouraging signs of conversion of EtO and gamma volumes into [indiscernible]. On execution, 2 important milestones were reached the start of operations of our large-scale [indiscernible] installation and the acceptance of the world's largest ebeam installation. We also launched [indiscernible], which extends its portfolio into the lower capacity segment.

In new applications, polymer development is progressing with the first installation at customer site expected to start by the end and on PFAS, we continued testing on ID concentrated mattresses.

Turning now to RadioPharma Solutions. Commercial traction remain solid, supported by deeper penetration in core markets and expansion into high-potential geographies. This was illustrated by 4 cycle [indiscernible] contract, with fringe in India to expand their [indiscernible] radiopharmaceutical production more general, thanks to the strong demand for [indiscernible] installed base has grown by an amazing 75% since 2016.

RPS also continued to extend its position along the radiopharmaceutical value chain following the [indiscernible] acquisition interfaces between oxytane and [indiscernible] enterprises are now aligned and available to our customers. [indiscernible] on integrating offering from isotope production through [indiscernible] We are now accelerating the next phase of [indiscernible] including portfolio optimization scale.

Finally, IPS launch Cyclone IQ for industry healthcare asset into 11 production, which I will discuss on the next slide. Let me maybe say a few words about how [indiscernible]. This launch extends or established on platform into lower capacity segment, designed for customers that do not need the larger system it provides a reliable alternative to demand addition. The product addresses both medical device sterilization and full radiation applications targeting either existing gamma operators, new entrants or manufacturers considering in-house realization.

[indiscernible] market interest since launch confirms the attractiveness of this segment, notably in Asia and Latin America. Before going further, I'd like to spend a few minutes on what we mean by overcapacity in the sterilization market. This chart is based on our internal estimate and is shown for illustration purposes only. As presented at our Capital Markets Day, the underlying demand for accelerator-based sterilization is broadly steady and predictable, growing at 6% to 8% per year, driven by GDP growth and rising medical care needs and standards. But the COVID period created an unusual demand spike even that conventional EtO and gamma capacity could not be expanded quickly enough to absorb customer tone into them of technology. That led customers to invest ahead of the underlying trends because the system order today takes around 3 years to reach a market, their capacity is still being absorbed is explained slower how the intake we currently expect.

Our view remains that this reflects a temporary imbalance between capacity and demand, other than the structural change in market fundamentals. A more balanced situation is expected around 2028 to 2029 as utilization catches up with installed capacity driving normalization of [indiscernible]

Turning to RadioPharma Solutions. We launched Cyclone IQ an MMI and met in June, a [indiscernible] dedicated to industrial scale statin to 11 production. As you can see on this slide, it complements the cycle on portfolio that we have built over time, expanding to diagnostic application to therapeutic, alpha and the [indiscernible] production. A statins 1 of the 2 [indiscernible] we selected a strategic place alongside [indiscernible] 225. With IQ, we are reinforcing our commitment to accelerate the bench-to-bedside adoption of statin 211 labor drugs. The IBA Technologies backlog decreased over the period, reflecting sustained conversion into revenues, while in the scale order intake are not yet picked up this year. As discussed earlier, this reflects the expected temporary overcapacity in sterilization market, which was not fully compensated by the great commercial momentum in RadioPharma, the 2-year equipment book-to-bill ratio, therefore, closed at 0.7.

Finally, looking at the financial results. Net sales increased to EUR 127 million, representing close to 40% of the total book sales, thanks to well executed equipment backlog conversion and growing installed base supporting services. Adjusted EBIT contribution is compared to last year, driven by less favorable product mix during the period, continuous R&D investment in radiochemistry and radioligand therapies within RPS as well as in PFAS and [ Polina ] projects within Industri.

Nevertheless, EBIT margin landed at 6.5%. I now hand over to Catherine for the corporate section and the group financial review.

Thank you, Henris. And let's start with an update of our new ventures beginning with PanTera, which continues to make strong progress. The company obtained recognition as a CGMP producer of actinium 225, following by its largest client. This is important because it supports the use of PanTera supply for clinical trials. PanTera regulatory documentation is already being referenced in clinical trial applications across the U.S. and Europe, demonstrating early adoption of its supply platform and facilitating the integration of its isotopes into multiple development profiles. In parallel, PanTera announced in May this year, an expansion of its collaboration with Terrapower [indiscernible] supported by the [indiscernible] . TPI will provide additional raw material while ERI will host and operate a new production line expected to be fully operational by end of 2027, together with a 30% increase in weekly output at the existing facility in [indiscernible] these initiatives will triple PanTera's total actinium-225 capacity while distributing production across 2 Belgian sites to strengthen supply resilience. The company also continues to be a strong commercial traction with more than 25 active customers across the value chain with several master supply agreements.

From the financial standpoint, PanTera generated in the first half of this year, EUR 13.7 million of revenue and EUR 6.7 million of EBITDA. The fourth and final tranche of the service is now expected in the second half of '26, which will further dilute IBA on our chip to 31% and generate an expected revaluation gain of EUR 5.5 million. Zooming in on the demand behind these figures, the actinium-225 line continued to expand with more than 40 active clinical trials currently ongoing for several indications, including prostate and urindocren canceled. Three of these have now reach Phase III with first results expected as from 2028.

Obviously, the outcome of this higher bit drive of future demand for actinium 225, depending on what they show in terms of efficacy toxicity profile and the range of tumors that can be [indiscernible] For PanTera, this is precisely why reliable regulatory rate supply matters as these programs progress.

Let's now have a look at the other ventures starting with [ MIQ ] factor. Following the equipment contract executed with IBA, development of the demo machine is progressing a key milestone as it will enable the system for semiconductor applications. The project is also supported by favorable market trends in cynical carbide power devices, particularly for electric vehicles and AI data center applications. Second, Energy received positive feedback from the proton therapy community following its presentation at Pitocin June, in Parallel, it secured a EUR 8 million loan from its first customer [indiscernible] as part of short refinancing efforts, while technical development remains ongoing.

Finally, [indiscernible] discussions with [indiscernible] are progressing regarding the joint development of production infrastructure in Europe and the U.S. and a [indiscernible] has applied for the part related to the construction of the first site in North.

Let's now close the business review section and move to the financials in more detail, starting with the improvement in profitability. The step-up in gross margin was the main driver of the profitability improvement, increasing from 29.5% to 33.7% year-on-year, combined with top line growth, this resulted in additional EUR 18.9 million in gross margin.

Operating expenses increased in nominal terms, while remaining at 28.7% of sales. This reflects a less investment to support IBA's growth, including key R&D projects, which we haven't capitalized and the enforcement of communication in this functions with GE as well as a recognition of EUR 2 million of bad debts following a prudent application of our risk policy. This semester was also marked by a one-off EUR 1.5 billion related to the resolution of 2 specific business claims in IBA clinical. Below adjusted lower financial expenses in PanTera has positive contribution with the equipment, further supported improvements, which I will detail on the next slide.

Starting with PanTera's positive contribution to IBA Group earnings. The equated result amounted to EUR 2.1 million based on IBA's 35.8% ownership. Other operating expenses were mainly impacted by the ESP implementation project that went live in April and by Dosimetry [indiscernible]. This was partially offset by lower financing expenses, which narrowed to EUR 2.6 million as the adverse foreign exchange loss reduced to EUR 1 million from EUR 4 million last year, and the impact of hyperinflation in Argentina, also [indiscernible]

Tax was slightly lower than last year, mainly due to the absence of footholding taxes and impact of dividend recorded in the first semester of 2025. If we turn to the cash evolution, you will note that we generated EUR 18 million of positive operating cash flows before working capital over H1, in line with the profitability of our activities.

However, the reversal of the working capital cycle continued to impact our cash position. And I will come back to the working capital dynamics and prospects in more details over the next slide. Investing cash flow mainly reflects capital expenditure and the price of adjustment paid on [indiscernible] acquisition based on the actual December 25 cash and working capital positions.

New borrowings reflect the [indiscernible] on the remaining tranche of our [indiscernible] bringing the total to EUR 50 million to the EUR 50 million acquisition term loan. The payments are related to movements in revolving credit facilities and leasing reimbursements. The movement in treasury shares include our 400,000 shares buyback program over H1, partially compensated by exercises of stock options or in all our group cash position decreased to EUR 44 million.

Before detailing the working capital evolution, let me briefly explain the accounting impact linked to the TFI regulation. The move to set for [indiscernible] changes the timing of all certain balance sheet items are recognized in project execution. This updated approach does not impact the underlying economics of our project as project profitability and cash generation remained unchanged. Two effects on working capital are worth highlighting. First, equipment [indiscernible] in stock for longer and it's transferred leader in the product life cycle, which mechanically increases reported inventories. Second, the [indiscernible] project accruals recognized earlier which increases [indiscernible] payables and project execution. Overall, those that temporary differences and the Board approval reconcile as projects progress towards shipments.

Turning now to working capital with this new approach in mind. Overall, the working capital requirement as over the last 3 years, shaft delivered from a strongly negative position to a slightly positive one at EUR 6 million, resulting in a negative impact on our financial position. The main drivers for this trend are our contract assets and liabilities, contracting [indiscernible] price and advanced billing that increased by EUR 52 million on a net basis. They continue to be impacted mostly by 2 elements. First, a few large contracts with unusually back-ended payment terms most notably our proton therapy projects in Spain. Those loans accounted for a EUR 19 million impact on H1 and accumulated EUR 54 million over time. Second, the currently slow order intake in industrial, which used to be a meaningful positive contributor to the working capital cycle. Then on a like-for-like basis, excluding the impact from the updated ERP-driven group. Inventories have decreased by EUR 18 million, driven by backlog execution. Payables have increased by EUR 23 million again, on a comparable basis, and note that the ESP migration, this retirees -- sorry, it's not processing of payments, but also customer invoicing during the April-June transition period.

Now in terms of prospects, as previously indicated, we expect the working capital situation to normalize as invoicing cash collection catch up with project execution and order intake pointing to an improvement of our cash and net financial position for '27. So we confirm these positive trends. You can [indiscernible] still expect volatility in the meantime, given the sensitivity of our operating model to a relatively limited number of large milestone collections. H2 '27 remains for [indiscernible] for market improvement and stabilization as 6 out of the 10 Spanish proton therapy projects will have been delivered by then. We remind that each delivery to EUR 10 million payment followed by EUR 8 million payment after final acceptance. In view of the first half performance and the momentum across businesses, we reiterate our '26 guidance of at least EUR 32 million supporting our long-term profitability trajectory.

Lastly, as you know, IFRS 18 will become applicable as from '27, introducing changing your to the presentation of certain financial performance measures. We will provide further details on future financial petition. And I will now over -- I will now hand over to Oliver for his concluding remarks.

Thank you, Catherine, thank you, Henri. During the first half of the year, we continue to execute with discipline, converting backlog, capturing new commercial opportunities and advancing our strategic priorities to further strengthen the group's positioning. A few highlights turned out. Proton therapy confirmed its return to sustainable profitability, building on a strong 2025 and positive market dynamics. Technology reimport, its competitive position through the launch of new products in strategic market segments and applications as innovation remains at the core of [indiscernible] We're also particularly pleased with the progress of PanTera one of the most promising assets within our venture portfolio. As a leader in the rapidly emerging therapeutic market, PanTera is expanding access to innovative cancer treatments while creating significant long-term value potential fully aligned with IBS mission.

At the same time, we stay focused on navigating a challenging market environment in Dosimetry and managing the current pace of our working capital cycle. Overall, these results we report our conviction in strength and resilience of IBA's business model, the diversity of our equipment and services portfolio, our leadership in attractive growth market and the strategic optionalities provided by new applications and ventures position us well for the end of the year ahead.

Thank you, Olivier. Before moving to Q&A, let me remind you of the key upcoming dates in our financial calendar. Let me also remind you that this presentation contains forward-looking statements. These statements are based on IBA's current assumptions and beliefs and are subject to risks and uncertainties as described in this disclaimer. We will now move to the Q&A session. [Operator Instructions] Thank you very much for listening to our results presentation. We will now open the Q&A session. And I see a few hands already raised. So we will let you David start by asking your questions.

Maybe on the -- coming back on the margin evolution for Porton therapy and technologies. Yes, if you can explain a little bit more [indiscernible] evolution for H1? And what's, let's say, the reiteration of the 2026 guidance implies basically and let's say direct follow-up to that. So how structural is the improvement that we've seen in PT, so that we've seen structural [indiscernible] so the current profit margin, should it be seen as a floor going forward moving to 2028? And a bit same question, but let's say, for the lower profitability in technologies. So given your comments on the overcapacity issues in industrial, so you expect it to, let's say, rebasing a bit of the profitability there?

And then the question on the net debt evolution. So I think, Catherine, you provided us with some guidance. If you can clarify a bit what you expect for H2? And then for 2027 and if you can please repeat by when you expect to have the 6 Spanish contract, let's say, delivered and installed. Was it in 2027? And so should we kind of expect like this inflow of 6x let's say, roughly EUR 18 million coming in. So yes, if you can give us some color on the net debt evolution.

Okay. I will start with your last question on the Spanish contract, it's a very straight 1 question. So we expect this year in 2026 still to ship 2 machines then 2 other machines in 2027. And there, the 4 remaining machine in 2028. And I like to mention it's time that there is a shipment, there is a nonpayment of EUR 10 million. Then on the question regarding the margin and the guidance that we gave for 2026. First, in terms of improvement of the margin, it's, let's say, mainly driven by more favorable equipment mix in proton therapy, it's linked to the fact that the legacy contracts are slightly decreasing the total portfolio that we have. And we like you have seen with order intake. We have a new contract in the portfolio in total. We have also improved the project execution, and we see our services and especially the services in proton therapy but not only contributing also to the improvement in gross margin that we have mentioned. In total, for the guidance that we gave for 2026, we didn't revisit the guidance, so we confirm at least EUR 32 million. So that's the first answer to your question. It's at least it's a kind of low the guidance. At this stage, we believe that its not appropriate to be more precise than that. And if there are a number of elements to be rather positive, namely the improvement the turnaround that we have seen in proton therapy, especially at the level of the margin. The very good commercial momentum we have in [indiscernible] at the same time, we see that those inventory is a little bit lagging behind and that the order intake in Industrial Solutions especially has been a little bit lower than initially expected.

For the second half of the year, we expect to have, let's say, more balanced H2 versus H1 than we had in 2025. And what does it mean? It means that especially on Industrial Solutions, so part of technologies, we expect the order intake to be better than what we had in the first half of the year. Of course, you know that all the projects and especially the project that we have in proton therapy. [indiscernible] negotiated over a very long period of time, and we might have some on the precise bonds during which we finally closed the contract with the customers.

Does it answer your question on the margin and guidance, and then I'm left with a question on net debt. But as we put...

Yes. Maybe very quickly on the margin evolution. So because you discussed overcapacity, should we think now that because of this overcapacity, there is significant pricing pressure in industrial, which will like last for a couple of years before it improves?

No. But maybe I will let.

So that first, you know that for us, it's becoming a bit of a region, 40%, 30%, 10%. You know that in our plan, PT was supposed to catch up and technologies was already at that level. The first semester is rather on the low side in terms of overall margin contribution because we had a new [indiscernible] unfavorable product mix. So you should not take the first semester of '26 as the benchmark for the [indiscernible] going forward. We stick to -- what we see is the overall margin plan for technology, and there is no reason to deviate.

The capacity question for me, does not put pressure necessarily on pricing because you know that in our technology, we have clear leaders. But that means simply that the single unit events in terms of others, there are probably a few opportunities this year to convert than what it was 2 or 3 years ago or what it will be in 2 or 3 years. But that does not change our pricing dynamic nor of margin dynamics.

And then on net debt, so what we expect is, let's say, relative stability over 2026, and then start of improvements, but let's say, light improvements in the beginning of 2027 with a marked improvement in the second half of 2027. So that's how we see the evolution of the net debt over the next months.

Thank you, David. So we move then to Frank Klassen from Degroof Petercam for the next set of questions.

All right. First off, my question is on the Dosimetry, you've implemented some cost savings there. Could you help us remind how could you quantify these cost savings? And what do you expect for the second half? Do you expect to return to profitability there? That's my first question. And then also the second question on the cost line. So looking at your operational expenditures, they moved up quite a bit, 17% to from EUR 29 million to EUR 93 million, driven, for instance, by the R&D. Is this EUR 93 million. Is this a sort of new run rate also for the second half -- or were there some temporary effects, which inflated the cost line?

I'll take the first one. So the effect of Dosimetry, you understood that it's market linked. I can further comment to go directly to your question, we said 1.6%. It's mostly people-related restructuring savings, they will start to kick in, in the second semester in terms of full impact, and we expect a return to profitability of Dosimetry in those instances.

That's clear. And the cost line?

Yes. So on the cost line, like you pointed out, we have an increase in specific elements, and I would only name 2 because they are the best contributor to R&D, like you mentioned yourselves but also G&A that increased a little bit due to IT cost licenses, but also some specific element that I mentioned in -- during the call. The way we look at it let's say, more in terms of percentage towards the revenues. So you mentioned the target that we have. And during the first half of the year, the percentage was 28.7%, which was more or less the same as during the year to 2025, so last year. So what targets over the long run is like Henri mentioned, 40% gross margin, 30% OpEx and then 10% of -- of course, during some years in white half utilization and more specifically for 2026 because we have not yet at the 40% gross margin. We expect indeed not to be at the 30% OpEx and to remain close of the percentage we had in each 1 of this year.

And I now we move to Michiel Declercq from KBC securities.

I have a couple of questions still. The first one is maybe a bit of a technical one on the accelerator or the IBA Technologies equipment revenue. So if we look a bit the order intake for equipment was down a bit, so it was EUR 28 million. The backlog was also down about EUR 28 million, if I'm not mistaken.

So there is a bit of a big gap between new order intake, the decrease in the backlog and the revenues that were booked. So I'm just trying to understand where the big delta is here. Was there may be some upgrades or something that I am missing here. That would be my first question. And then secondly, I missed part of the earlier question of David on the overcapacity in industrial. Can you tell a little bit what you are seeing in the market today? Are customers or is interest coming back already, given that you mentioned that it takes about 3 years before this capacity is filled or -- what have you been seeing here? And how are you, say, your new applications, are you seeing interest in that for polymers would mediation. So any comment on that would be useful.

And then lastly, also, if I look at the proton therapy systems that have been sold so far this year, I've seen 2 from CGM. Can you elaborate a bit on this on which systems these are? And have you received -- or will you receive royalties on these that we should take into account in our forecast. Those will be my questions, please.

1

On the relationship between order intake and revenues, you know that it has to do with the pace of backlog conversion. So it's indeed, ironic that we have been quite performing in terms of backlog conversion, generating top line growth, whereas the order intake spot in the first semester was a bit on the low side. You know that it can quickly be turned around with a few projects being booked. And that in general, the order intake we would book in a given semester would be converted further down the road.

So nothing specific to read in the numbers, except that indeed, the book-to-bill ratio decreases because we have been converting a lot, whereas we have not replenished in the first semester to the same extent, that's what we have been able to conduct. If I look at your question, which is what do I see in the market, so you understand that the volume that is being irradiated or treated or stabilized, I should say, moves in a quite in way. It was the purpose of the page that we have added in the document. So somehow we are not concerned about the evolution of the underlying market for sterilization.

To the contrary, we see medical equipment being very much present, but we see new opportunities, as we've mentioned in other applications. and I can list a few. So we are completely pleased with the underlying market evolution. What we noticed, though, is that with 3 available technologies in the market, ethylene oxide gamma and the accelerator-based technologies. And with the copictime, a lot of players have installed a lot of capacity. So similarly, to what you could see in petrol refineries or in paper mills. There is a lot of capacity that has been installed. And therefore, we see that the conversations with clients with regards to launching new projects have been slower tracked. That being said, we have a very active pipeline. As I mentioned, we have a very active pipeline with the Rhodoline which is our new product, which taps into new segments of clients that are doing for looking for smaller volumes installations and facilities. And as you see as well on the graph, in IBA time, which is always long cycles, we are completely convinced and reassured on the fact that the volume to be treated, will catch up with the capacity, and it's going to fuel is going to fuel further demand for our equipment. The key underlying question was for me, our relevant is our value proposition compared to other technologies. We continue to see clients who are now wanting to convert from [indiscernible] to [indiscernible] and that's the first because they see continued pressure from a regulatory point of view on EtO. And we continue to have conversation with plants about gamma [indiscernible] supply that is being constrained in many regions of the world, again, creating an appeal for the IBA solutions.

And then on your question on CGM the consequences of the agreement with CGM and the sales that they have done is already included in the guidance that we have given to the market.

Okay. I assume that the guidance excluded any potential sales in China? I mean do you have the capital market...

Sorry, it was in the guidance.

For the time being, there are no other hands raised for asking questions giving 30 seconds to make sure.

Yes, an additional question on PanTera and thanks very much for all the disclosure. Is it today too early to ask you for, let's say, a rough 3 to 5 years guidance on kind of this high-level business plan for PanTera given you've started to give quite some color on the sales, on the EBITDA and the net profit.

I think the answer is already in your question, David. So we give some information today because we see PanTera been quite active in the early supply on the commercial traction that might possibly come once the results of the clinical trials are known. It's a different world, and that's something on which we can't comment today.

Okay. And maybe a quick one on the EUR 2 million of higher bad debt. I think you disclosed in the on the other operating cost, if I'm correct. Can you comment a little bit? So you say higher bad debt. So I think specific.

No, I think that the higher bad debt might be a little bit misleading. So the goal was just to give the amount of bad debt that we booked there. That's EUR 2 million I think last year, we had EUR 4 million in the same period. So basically, there is nothing more than last year, and that's in of our bad debt policy, we saw that there is anything special behind.

Okay. So the right way to understand it, it is EUR 2 million, but that last year you had 4.

Exactly.

Thank you. At this point, we do not see any remaining questions. So we would like to thank all of you for attending this call and hope it was helpful to shed some more light on our business and financials. So we wish you all of you a good afternoon or a good day, depending on where you are based, and it to you and the next opportunities.

Hello, everyone, and welcome to the presentation of IBA's 2025 Full Year Results. I'm Thomas Pevenage from Investor Relations. As usual, you will find this presentation on the Investor Relations page of our website. A Q&A session will follow the formal presentation.

Moving to next page. Let me draw your attention to the company's disclaimer for forward-looking statements, which, as you know, are based on our current assumptions and beliefs and subject to risks and uncertainties. Today's speakers are Olivier Legrain, our Chief Executive Officer and IBA Clinical Lead; Henri de Romree, our Deputy Chief Executive Officer and IBA Technologies Lead; and Catherine Vandenborre, our Chief Financial Officer and IBA Corporate Lead.

Here is the agenda for today's presentation. We will start with our highlights for the period, followed by a business review, where we will discuss the strategic progress and the financials of each business unit. Finally, we will cover our financial performance in more detail and give you an update on our guidance and outlook before opening the Q&A session.

Thank you, Thomas. I'm Olivier. Good afternoon, everybody. Let me start by sharing our key messages for today. Full year '25 was a strong year for IBA. We delivered on our commitments. Our guidance has been met and we progressed as planned on the execution of our strategy while the group continues its transformation. This dynamic is reflected in our full year '25 performance, record revenue exceeding EUR 620 million; adjusted EBIT, formerly known as REBIT of EUR 27.4 million and a return to profitability in Proton Therapy.

Our growth engine has also strengthened with a record backlog of EUR 1.6 billion, supported in particular by the scaling of service in Nuclear Medicine and a strong Proton Therapy order intake. Beyond this annual performance, 2025 marks the inflection point from a historically cyclical project-driven model towards a more consistently profitable platform. The '24-'28 financial outlook is confirmed, and we are providing a full year '26 guidance being an adjusted EBIT of at least EUR 32 million.

Let me now have a closer look at our commercial momentum. In full year '25, IBA recorded a very strong growth in order intake, bringing our backlog at an all-time high of EUR 1.6 billion and providing increased visibility for the future. Service backlog grew particularly strong, up 16% year-on-year, reflecting the continued expansion of our Proton Therapy installed base, but also a strong contribution of Technologies. On the equipment side, we posted an historic equipment order intake of EUR 452 million, representing an increase of around 40%.

Looking at our business unit, in Proton Therapy, we sold 12 rooms during the year, our second best year ever, reflecting strong commercial traction, particularly in the U.S. and in Asia. In IBA Technologies, 37 systems were sold compared with 33 driven by strong demand in RadioPharma, while Industrial Solutions normalized following record high years. As a result, the 2-year rolling book-to-bill ratio reached 1.0 as Equipment order intake grew broadly in line with revenue recognized over the period at group level.

I will now move to our key financial metrics. In full year '25, group revenue reached a record level of EUR 620 million, an increase of EUR 122 million compared with full year '24, thanks to well-executed backlog conversion and the growth in service activities. Adjusted EBIT amounted to EUR 27.4 million, exceeding our guidance, a profitability improvement of EUR 10 million year-on-year. The adjusted EBIT margin increased to 4.4% compared with 3.5% in '24 despite a decrease in gross margin driven by a temporarily less favorable equipment profitability mix.

Net debt stood at EUR 58 million as of December 31 as working capital continued to be impacted by the delivery of large Proton Therapy projects. On a like-for-like basis, excluding the ORA acquisition, net debt would have been EUR 41 million. Our net leverage ratio at 0.83x adjusted EBITDA remains healthy. Building on strong execution delivered in '25 and the momentum across our businesses, we are setting full year '26 guidance at a group adjusted EBIT of at least EUR 32 million.

Let's now move on to the review of our business performance. I will start with the progress of IBA Clinical. In '25, our clinical entity benefited from a strong commercial momentum, continued technological innovation and a very significant improvement in Proton Therapy profitability. The year marks a clear turnaround for the business supported by disciplined execution and a more favorable project mix. The year was marked by several important milestones in Proton Therapy.

MD Anderson published the first ever Level 1 clinical evidence from a Phase III randomized trial confirming proton therapy as a standard of care. We also launched a minimum viable product of DynamicARC and obtained the Medical Device Regulation certificate for Proteus 235 reinforcing the robustness and the regulatory maturity of our Proteus platform. In Dosimetry, we continue to innovate with the launch of the QUASAR Phantom for MR Simulation in the radiotherapy market and the release of myQA Blue Phantom. We further strengthened our product portfolio positioning through the acquisition of PhantomX, enabling AI-based quality assurance.

Turning now to our global footprint in proton therapy. At the end of the year, IBA had 45 operational sites, well distributed across regions with strong visibility on future expansion as 43 systems are in production and installation. At year-end, we had 8 sites under installation and reached a peak of 10 installations running simultaneously in '25, a new high that demonstrates our execution capability. This include the ongoing installation of the first Proteus ONE in Spain as part of the 10 system order. The installation of 3 additional projects is expected to start in '26, subject to building construction time lines. In China, we made strong progress on major Proteus PLUS installations with the first live treatment rooms in Chengdu and Shenzhen and final acceptance expected by year-end '26.

'25 also allowed us to further consolidate our market leadership in proton therapy. Thanks to the 12 rooms sold, we accounted for 63% of the total sold globally during the year. IBA continues to have the largest installed base in the market, which provides significant operational leverage and represents a robust platform to further promote proton therapy in close collaboration with our clinical partners.

Increasing clinical evidence continues to be a key driver of Proton Therapy sustained momentum. In December '25, the Lancet published the first ever Level 1 clinical evidence, the most robust level of clinical data for a Phase III randomized trial led by MD Anderson. This study establishes Proton therapy as a new standard of care in head and neck cancer, demonstrating superior overall survival rates and significantly reduced side effect compared with conventional radiation therapy.

In addition, early results from the RadCom Phase III Breast Cancer Trial presented at ASCO showed significantly improved patient reported quality of life with proton therapy in breast cancer, one of the most prevalent cancer types. Lastly, new studies have been recently added to pipeline of upcoming clinical evidence. We will continue to report on results.

Despite an accelerated conversion into revenue, IBA Clinical continued to build backlog solidly in '25. Equipment backlog reached EUR 564 million, while the 2-year equipment book-to-bill ratio stood at 1.1, providing a sound platform for the future. Service backlog grew even faster now exceeding EUR 800 million.

Zooming in on Proton Therapy Services, the increase in service backlog was supported by new orders and 7 renewed contracts while with existing customers. These contracts more than offset the amount of service revenue converted into P&L during '25. As a result, Proton Therapy Services continue to strengthen visibility, recurrence and long-term value creation within IBA Clinical.

Let me now focus on Proton Therapy's performance and profitability turnaround. In '25, Proton Therapy returned to profitability, delivering a positive adjusted EBIT contribution of EUR 10.2 million compared with a negative contribution of EUR 12 million in '24. This improvement was driven by, firstly, top line growth as equipment sales more than doubled and service expanded. Secondly, profitability improvement with the scaling of our installed base. At adjusted EBIT level, this improvement was partially offset by continued investment in critical product innovations, including DynamicARC and FLASH and by the prudent application of our internal credit risk management policy with a recognition of EUR 8.7 million in bad debt within G&A. These are isolated problematic situations that we were willing to reflect while the overall quality of our credit exposure remains sound.

Turning to Dosimetry in '25. Dosimetry delivered a stable top line in a challenging environment as already communicated throughout our trading updates. However, profitability continued to be negatively impacted by this competitive and regional dynamics in the U.S. and China. This effect was further amplified by the absence of last year's one-off subsidy grant of EUR 800,000, which overall contributed to a decrease in adjusted EBIT. These market dynamics also impacted commercial activity with order intake decreasing by 9%. As a result, cost optimization measures have been defined and will be rolled out in '26, ensuring a sharper focus on core activities and a realignment of the cost base with current market condition. I will now hand over to Henri to comment on the performance of IBA Technologies.

Thank you, Olivier, and hello, everyone. Let me walk you through the strategic progress achieved in IBA Technologies, starting with Industrial and then going to RadioPharma solutions. Industrial Solutions continued to progress along its road map, advancing accelerator-based sterilization and advanced irradiation solution. Ongoing market dynamics continue to support the long-term shift towards, X-Ray and E-Beam technologies as regulatory and environmental pressure on ethylene oxide increases.

At the same time, the sterilization market is somewhat digesting temporary overcapacity after a peak in order intake in early 2020, partly linked to the COVID-driven investments. We remain very confident in the underlying market that is growing steadily and expect industrial order intake to normalize as utilization catches up with the installed capacity.

In China, despite slower pipeline conversion with some project shifting in the coming years, we made substantial headway last year signing 2 additional high-power [ x-ray ] contracts, tripling the current local capacity.

In terms of new application, we advanced our PFAS project progressing through technical trials and studies. And in polymers, another area with promising long-term potential, research continues to show potential with pilot progress remaining on track.

Turning to RadioPharma solutions. We saw solid commercial traction with the highest order intake to date, supported by deeper penetration in our core markets and an expansion into high potential geographies. This was illustrated by the sale of a high-energy Cyclone IKON contract to PET Pharm Bio to install a PET and SPECT isotope production center in Taiwan. More recently, post period close, we also signed 2 strategic multisite contracts in the U.S., one with SpectronRX and another one with RLS/Telix.

Finally, we continued significant efforts to expand our position in the radiopharmaceutical value chain, which I will detail on the next slide. As you know, IBA strategy in nuclear medicine is leveraging on our accelerator technology leadership to expand along the value chain and build a next-generation oncology platform. A key building block of this platform is ORA, a recognized trailblazer in radiochemistry, which we acquired in December. Another element in Theranostics, where we are making good progress. I will now cover these strategic initiatives in more detail.

Let me first come back to the ORA acquisition, which represents an important strategic step for IBA in nuclear medicine. Completed at the end of 2025, the acquisition of ORA brings into IBA, a Belgium-based radiochemistry company with a highly skilled team of around 15 employees, including senior radiochemists, a strong record in automated PET radiopharmaceutical synthetizers and established relationship with leading pharmaceutical partners.

By combining IBA's leadership in cytotron technologies with our cutting-edge expertise in radiopharmaceutical synthetizers, we are creating one of the most competitive integrated solution available for hospital and global radiopharmacy networks. This new integrated offering addresses the full radiopharmacy workflow from isotope production to purification, labeling and delivery and is designed to support customers seeking higher productivity and access to advanced radio isotopes. Importantly, the ORA acquisition is immediately accepted to IBA Technologies revenues and profits.

And now moving to Theranostics, which is, as you know, a strategic pillar for RadioPharma solutions. It is indeed a fast-growing segment with a nuclear medicine [ serving ] with a projected market size of USD 20 billion by 2030 based on a 35% growth rate on a yearly basis as presented in our last Capital Markets Day.

As you can read on the slide, several isotopes are emerging in this field out of which we are highlighting the most mature ones. Within this landscape, IBA decided to focus on actinium-225 and astatine-211 as strategic place based on clinical development as well as our technological and industrial edge. You already know our subsidiary, PanTera, paving the way to making actinium-225 treatment widely accessible. Catherine will update you on their progress in the corporate section of this presentation.

Besides, we are increasing momentum for astatine-211. We are positioning ourselves on this emerging market. Firstly, on the technology front, we are developing a dedicated high-throughput cyclotron. Secondly, on the clinical side, we are one of the co-leader of the accelerate.eu program funded by the European Union. This ambitious platform combines industrial clinical and pharma players around a bench-to-bedside ecosystem to accelerate astatine-211 translation into a clinical setting.

Lastly, with respect to production infrastructure, we continue to make good progress with a partner, Framatome, on our joint ambition to enable the astatine-211 market through the deployment of a full-fledged production network across Europe and the U.S.

Turning now to the technologies backlog, you will notice a decrease over the period, reflecting stronger conversion into revenues. Industrial Solutions order intake has not yet picked up as market absorbs the temporary overcapacity as this was not fully compensated by the strong market momentum in RadioPharma. It led to a 2-year equipment book-to-bill ratio of 0.8 below reconstitution level.

As far as service are concerned, backlog now includes upgrades. Nevertheless, IBA Technologies' contribution remains limited as our scope mostly relates to short-term 1-year maintenance contract with no permanent presence of an IBA [indiscernible].

Finally, looking at the financial results, net sales remained stable at EUR 225 million, representing more than 35% of total group sales. This is a solid achievement following 2024 strong growth. Adjusted EBIT contribution eased compared to prior record year. This is driven by 2 elements: first, a less favorable project mix, most notably a higher share of RadioPharma integrated projects where we collect lower margin on our third-party equipment; and two, intensified R&D investment in the radiochemistry and radioligand therapies within RadioPharma as well as in PFAS and polymers within Industrial. Nevertheless, EBIT margin landed at 8.9%.

Let's move onto IBA gross profit. I will now give the floor to Catherine who will walk us through the corporate activities besides our group CFO.

Thank you, Henri. And let's start with an update of our new ventures beginning with PanTera, our joint venture launched with the Belgium Nuclear Research Center. In June, PanTera started the production and the supply of actinium-225 for clinical trials and compassionate use reaching full-scale weekly production in October.

The year 2025 also saw the start of the construction of a large production plant located in Northern Belgium. Of course, all required permits were obtained ahead of the start of the construction. Operations are expected to start in '28 with first commercial scale supply targeted for '29. Finally, it is worth noting that PanTera continues to build strong commercial traction with more than 20 active customers across the value chain, including pharma and biotech players as well as key reference hospitals and research institutes. Multiple clinical trials are ongoing spread across different phases with first results expected from 2028. We will keep you posted on further developments.

From a financial standpoint, PanTera generated EUR 13 million of revenues in '25 and became EBIT positive in Q4. In terms of funding, PanTera called the third tranche of its Series A for IBA. This resulted in a EUR 7.2 million revaluation gain and dilution to around 35%. A fourth and final capital increase tranche is expected in the first semester 2026, which will further dilute IBA shareholding to 31% while generating an expected revaluation gain of EUR 5.5 million. We remind you that PanTera was valued at about EUR 290 million post money in September '24.

Let's now have a look at our other new ventures. First mi2-factory in the field of semiconductors achieved a very important milestone with the finalization of the demo system specifications for its first machine based on updated market requirements. Post period, an equipment development and purchase contract was executed with IBA for a value of EUR 15 million covering the accelerator component of mi-2's end-to-end solution.

Second, NHa, our HadronTherapy project launched in collaboration with Normandy region, reached an important derisking milestone with the installation of the [ superconducting coil ] on site. Cooling activities are in progress and generation of the first magnetic field is expected over the summer. In parallel, efforts are ongoing to secure short-term and long-term financing. Post closing, NHa secured the first tranches of the anticipated bridge funding from its funders and other reference shareholders.

Turning to our sustainability agenda, '25 delivered concrete progress that reinforces our ability to deliver sustainable growth and long-term value creation. We maintained strong momentum on decarbonization, remaining on track towards our Scope 1 and 2 reduction targets. More than 90% of our electricity now comes from renewable sources, supported by the continued rollout of our low-impact mobility policy. We also advanced the sustainability of our installed base. In the U.S., the full system restoration at MGH is underway, upgrading the proton therapy system to modern standards while avoiding a carbon-intensive decommissioning and rebuild.

Beyond environmental actions, we expanded our contribution to patient support. Through the Oncia community, patients across Belgium, Spain and France benefited from human-centered supportive care. Governance and value chain initiatives also progress. We are proud to see our B Corp score increasing to 118 from 114 in 2024 and we published our first CSRD report. Let's now close the business review section and move to the financials in more detail, and let's start with the commercial traction behind our performance in '25.

As mentioned earlier, we saw strong growth in equipment order intake, mainly driven by Proton Therapy with order intake up 137%, achieving the second best year ever in terms of rooms sold. From a regional perspective, overall commercial traction in '25 was mainly driven by the APAC region, including 7 out of the 12 PT rooms sold over the year. This contrasts with '22, where growth was mainly driven by EMEA, boosted by the Spanish PT project. The Americas have remained a solid core market for IBA across the years.

Turning now to profitability. '25 is driven by a record high top line, up 44% year-on-year, partially offset by a reduction in gross margin down to 32.2%, mainly due product and project mix. This resulted in a combined effect of additional EUR 31.5 million in gross margin. Operating expenses increased in nominal terms, but progressed less than proportionately to revenue at 28% of sales compared with 30% in '24.

Within OpEx, the increase in G&A reflects selected investments to support business growth, including digital and organizational initiatives, but also the one-off impact of higher bad debt in IBA Clinical at around EUR 9 million, following a prudent application of our risk policy. Finally, R&D increased as we progress on key projects, strengthening IBA's growth platform, including Proton Therapy imaging, DynamicARC, radiochemistry and [indiscernible] PFAS destruction.

Let me now comment on the main items below adjusted EBIT. They were mainly impacted by a project to migrate to [ S/4HANA ], which is expected to be completed in the first semester of '26 and by a foreign exchange loss due to unfavorable currency fluctuations, in particular, the U.S. dollar, which is largely noncash. In addition, hyperinflation in Argentina continued to negatively impact our Proton Therapy project in Buenos Aires for EUR 1.9 million in '25. Impact was, however, reduced versus '24 and will wane in '26 as the project nears completion.

Turning to PanTera. You will note a negative contribution under the equity method linked to negative result and a EUR 7.2 million revaluation gain, as already mentioned. If we turn to cash evolution, you can see that operating cash flows were negative over '25 due to cyclical working capital movements. While inventories decreased compared to '24, contract in progress increased substantially, reflecting the high volume of project activity in '25 with cost and revenue recognition progressing ahead of invoicing and cash collection. This trend is expected to start improving over the second semester of '26, partly thanks to the delivery of proton therapy projects in Spain and China as outlines by Olivier before accelerating in '27. Investing cash flows include the ORA acquisition.

As already announced in our Q3 '25 trading update, we closed EUR 135 million refinancing package in November to strengthen our balance sheet structure and capture strategic opportunities. We have indeed, in December, partially financed the [indiscernible] ORA acquisition by drawing entirely of EUR 50 million acquisition term loan. Building on the strong execution in '25, we provide 1-year guidance for '26 of at least EUR 32 million of group adjusted EBIT. With backlog at an all-time high and services contributing to growing recurring income, we reiterate our confidence in IBS profitability trajectory while being mindful of the current macro and geopolitical environment. As a result, we reiterate the '24-'28 outlook announced at last year's Capital Market Day.

I will now hand over to Olivier for his concluding remarks.

Thank you very much, Catherine. To conclude, I would say that '25 represents a key milestone for IBA. We delivered record high revenue and strong order intake, clearly reflecting the robustness of our commercial momentum across our businesses. Profitability improved meaningfully, supported in particular by the scale-up of Proton Therapy, driving the turnaround of our largest business unit back to profitability.

At the same time, we continue to make disciplined and targeted strategic investments to support IBA's long-term growth. Throughout the year, we also actively managed our financial position and funding, strengthening the group resilience in a volatile environment. Finally, full year '25 guidance has been delivered, confirming the execution capabilities of our teams and the solid foundation of our transformation. With a strong backlog, clear growth drivers and improved visibility, we enter '26 with confidence and a clear trajectory ahead.

Thank you very much to the audience for listening to our results presentation. For information, you will find on this presentation the key dates from our financial calendar. We will now move on to the Q&A session. [Operator Instructions]. We will start with Frank Claassen. So you should be able to speak, Frank. Frank, we cannot hear you, or maybe we can start with David. He was the second in line.

Hello, this is Frank Claassen speaking. Can you hear me?

Yes, we can.

Okay. I had a bit of trouble here. This is Frank Claassen of Degroof Petercam. I have 2 questions. First of all, on your gross margin, it declined in '25 because of the low-margin legacy contracts. What can we expect in '26? Is that -- the legacy contracts, will that roll off? And hence, can we expect some gross margin improvement in '26? That's my first question. And then secondly, on the symmetry, you're taking cost measures here. Can you elaborate what kind of cost measures? And will we already see the benefits in '26? Hence, can we see margin improvement in '26 already?

So I will take your first question and leave for Olivier, the second question that you raised. So maybe to give a little bit more of color on the '25 gross margin. I would start by saying that indeed, it was impacted, like we said in the past by project in Proton Therapy where margins were lower than the typically targeted margin. But it was also impacted by an unfavorable project mix in RadioPharma.

And so compared to, let's say, other years, we had those 2 effects. Dosimetry declined a little bit as well, but Industrial Solution improved. And Proton Therapy, and that's quite interesting, even if it's still impacted by those contracts that we signed with low margin, Proton Therapy improved compared to 2024. And that's also a way to signal the trends over 2026. We expect indeed an improvement of gross margin in '26 compared to 2025.

And this is led by 3 major trends. The first one is a kind of more healthy competitive dynamics in the proton therapy market. And of course, it will take time before those contracts signed, especially in '22 will be fully realized, but the more we progress, the less important is the relative share of those contracts. Second element that we already mentioned is the scaling effect in Proton Therapy services where we really improve general margin, thanks to different efficiency measures that we implement. And the last one is a more favorable mix in RadioPharma with high-end applications.

When it comes to Dosimetry, we took -- we have implemented actually a number of cost reduction measures, productivity measure to adjust to the vision we had on the market development while preserving the sustainability through continued R&D investment. And the short answer to your question is yes, we can expect to see profitability improvement in Dosimetry already in 2026.

We can move to David.

First, a little bit on the question of Frank. So -- but on the 2026 guidance, so I heard you comment on the gross margin. Can you also comment on the top line and the OpEx growth or additional OpEx investments that you're planning for 2026? And then also related to 2026, could you explain us what could be the impact of FX moves on the top line and also the gross margin, if that plays a role? Then my third question on the bad debt. So you've mentioned in the press release that risk management played a role. So could you explain how you've changed your credit risk analysis?

Okay. So I will take your question on the evolution of the top line, OpEx and I think guidance overall in 2026. So first, in terms of top line, you might remember that we realized a growth of the top line of 7% in '24. We have now 24% in '25. And we mentioned in the Capital Market Day last year that we expected front-loaded growth.

In total on '24-'28 trajectory that was announced with the range, 5% to 7% growth per annum overall. And what we can say is that we confirm the range, but we expect also to land at the high end of this range. We need to have in mind that '25 was particularly strong in terms of revenue. So each year over the period may not be as solid top line-wise. But of course, what we will focus on is to improve the profitability overall versus a very aggressive top line growth.

And so it brings me to your question more generally on the guidance, gross margin and OpEx. So like already stated, we can expect an improvement of the gross margin in '26 versus '25. OpEx are expected to grow a little bit as well, but quite reasonably. You might remember that in terms of OpEx, we took the commitment to maintain them at maximum 30% of the sales. And that's the reason why if you have in mind the 28% of this year, it will remain relatively moderate as a growth.

In terms of overall guidance, I think that we can say that we have been at this stage relatively cautious for 2026. The guidance that we gave is like in 2025, when to beat and not necessarily to meet. I think we need to have in mind that the macroeconomic environment is uncertain. And in this context, we remain cautious at this stage and give a guidance that underwrites those uncertainties. But as we continue to progress in execution over the year, we might update the guidance. And all in all, '26 guidance is on track to achieve an EBIT margin of around 10% in 2028.

Regarding the bad debt, which was your other question. So in terms of management of the bad debt, the first element I would like to stress is that we -- of course, we have a policy based on which we try to secure payment through a number of elements like letters of credit, credit risk insurance, bank payments, guarantees and other instruments. But in 2025, we booked close to EUR 9 million, EUR 8.7 million, a little bit in an exceptional way. It's primarily linked to 2 PT customers in China or in the U.S. We are still in discussion with those customers. So we don't exclude to recover part of the amount later. But we believe at this stage, it was more cautious to book those bad debts.

And a follow-up on my question on FX or it could be [indiscernible] in gross margin?

Yes. FX is, of course, quite difficult to predict the evolution. So we have -- you know that we have a hedging policy, which tends to hedge the cash exposure and not the P&L exposure. So we might remain exposed to fluctuation, especially versus the dollar, which are, of course, quite difficult to predict.

Is it more of a negative with your cost in euro and your revenues in dollar? Or is it?

So it depends on the type of activities we have. If you look at the services taking into account that the vast majority of the activities are local, there we have a kind of natural hedge between the cost and the revenues. For equipment there, we still have a base of supplier, which is in Europe and in Belgium. So we tend to do our acquisition or purchase in euro. And then we sell in different currencies. In our negotiation with the customers, we always try to sell in euros, but you can imagine that sometimes it's not accepted by the customer and there, we hedge the position from a cash perspective.

There are currently no more questions. No one else raising his hands.

Otherwise, I have another question. On the net debt evolution, so if you could comment and also -- okay, on 2026, but also maybe give us some perspective on 2028?

Yes. So on the net debt evolution, so first, you saw the figures on '25. I will repeat them for the sake of clarity. So we ended at financial net debt position of EUR 58 million, but like-for-like, it would have been EUR 41 million if we don't take into account the acquisition of ORA, which was, of course, executed at the end of '25 and fully funded with debt.

Now going forward, that was your question. '26 will still be impacted by the low-margin contract that we have signed mainly in '22. What we expect is that as from the second semester of '26, mainly the second semester with more devices shipped and expected payments linked to the shipment of those device, the cash situation is expected to improve over the second semester compared to the situation at the end of 2025, but still remaining negative in the sense of net financial debt position at the end of 2026.

We will need to wait '27 to see an improvement with, let's say, reversal in our working capital cycle and end the year on a positive situation rather than a net financial debt. And the trend -- this positive trend is expected to continue in 2028. Of course, all this is based on the assumption that we have payment from the customers like we had in the past, so based on historical type of payments.

Time to raise your hands if you want to ask the last questions. So [indiscernible], you should have the floor open. I think you have to click on unmute to make sure we can hear you. Okay, I think he was having a technical issue. [indiscernible].

Just on Dosimetry, I thought -- I don't know if I heard from someone that you would be thinking about exiting this business again? Or was that the false rumor profitability there is really, really disappointing. What's the future of this division?

So for Dosimetry, we confirm that we continue to see it as a valuable activities, well anchored into IBA's portfolio of activities and notably with a very strong connection to the proton therapy market. So yes, it was a fake news that you've heard.

Maybe an additional question from my side. I saw that there were 3 PT contracts for which the services contract were discontinued. So 3 PT rooms for which the contracts were discontinued on the services side, do you see more of your portfolio of existing PT system at risk of where the maintenance could not be -- could be discontinued?

So I think one of them is one in Russia. So we don't have any additional site in Russia. So we had to indeed discontinue service in Russia, even though the site is still operating. The other one was one of the first sites that we have installed. It was in China, and we proposed the customer to either upgrade the site like MGH did or we could not ensure regulatory compliance anymore, and we had to discontinue. So back to your question, no, I don't expect more of this kind of situation.

And the third one to be very precise, is MGH. So we temporarily stopped because we are doing the refurbishment of the site there. But of course, we expect to renew the contract once the refurbishment is done.

Exactly.

[indiscernible], I think you have another question?

Yes. On proton therapy, since you have around 65% of new market share, can you comment on your pricing power? Do you use your strength to have, yes, better pricing and margins, et cetera, because there's still a long way to go, I guess.

Well, I think on new contracts, we are where we want to be in terms of pricing. All of them remain competitive. So there is not one single deal where we are alone or so we need to remain within the industry benchmark. But in all new contracts, we are on industry benchmark. So we are back to where we want to be in terms of gross margin.

Yes. Well, for us, it's a bit hard to understand if you have such a high market share, why you say that you have to remain within industry benchmark. That seems -- or that's hard to understand for me as an outsider, one would think that you would have stronger pricing power than -- if you have -- if the market is so competitive, then it means that you're not so unique or maybe I understand wrongly?

I think it says it all. We have a dominant market share, but market is competitive. So I think we have a genuine competitive advantage that makes us win and not win on price, but there's a limit to that. And once again, it's not that we don't have competitors. We have competitors and they are credible enough, let's say, but we are more credible to win more deals with some kind of -- not on price, but on genuine value of our portfolio.

Okay. Now I understand. Just one other -- another rumor I heard was that the PFAS project wasn't going that well, but Catherine explained it. It seems to be progressing. Perhaps could you say a little bit more on the prospects of the PFAS project?

Maybe you should tell us where all these rumors are coming from.

Well, it comes from a discussion I had. So in terms of PFAS, there are different applications or solutions that we were looking for in water, but also in, let's say, solid elements on solid elements. On solid elements, I think from a scientific point, we didn't see a solution that would lead to a satisfactory business case. On water, the tests are positive from a scientific point of view, and we are now working on the positive business case together with partner.

That's why rumors are good. Now I understand this is precisely the right context.

Anyone else or follow-on questions? Okay. It seems we have answered all questions that were raised. So many thanks again for attending the call and supporting IBA throughout our journey. We wish you a good end of day or start of day depending on where you are, and happy to maintain the dialogue going forward. Many thanks.

Thank you very much. Thank you. Bye-bye.

Thank you.

Hello, and good afternoon, good morning. Welcome to our conference call for the Third Quarter Trading Update. We are pleased to welcome you and take this opportunity to have a dialogue with you. So we have prepared a short presentation considering it's just a third quarter update and the full update that we provide in the full year and half year results.

So basically, we'll cover the presentation together with Catherine and Olivier. [Operator Instructions] So you'll see our usual disclaimer on this slide, today's speakers, so Catherine Vandenborre, Chief Financial Officer of IBA. Olivier Legrain, our Co-CEO in charge of IBA Technologies, he is also joining us and happy to take questions and myself, Tom Pevenage, taking care of Investor Relations.

So we'll start with the highlights -- key highlights on the business side. And then that's a specific topic for this trading update, we'll cover the corporate refinancing that you could discover as part of our press release earlier today. So I will now leave the floor to Catherine for the first section.

Yes. Good afternoon or good morning, everyone, and thank you very much for attending this trading update call. Like Thomas mentioned, we hold this call today basically to provide you with qualitative trading update. We will again confirm the trends in our operational activities, ensure that they remain fully aligned with our guidance.

We will briefly discuss the trends we see in the markets, and we will present our new financial structure before, of course, answering any questions you may have. So first element that I would like to stress is that IBA remains fully confident and highly confident to meet this year guidance, being EBIT at least EUR 25 million, and that's supported by well under control OpEx, which remain below our long-term target of maximum 30% of sales and an already positive EBIT contribution from Proton Therapy. This is for us a very important milestone resulting from the scale-up of Proton Therapy activities and favorable project mix.

Of course, it underpins our commitments in the profitability improvement trajectory that we set ourselves at the beginning of the year. In terms of equipment order intake, this one amounts to EUR 195 million. It's an increase of EUR 11 million versus Q3 2024, thanks to a strong contribution from IBA Technologies, which increased by 22% and more specifically RadioPharma solutions.

To give a little bit more flavor and details, FPS has an excellent commercial momentum in high energy Cyclone IKON and Cyclone KIUBE systems in both emerging and more mature markets and applications. And in this we have a quite active pipeline in China. In PT, we have sold 4 Proteus ONE at the end of Q2 -- Q3, sorry, 2025. If you remember last year, same period, we had sold 3 Proteus One. And the sales includes 2 Proteus One orders from our existing customer, Apollo in India, which is expanding beyond its already operational multi-room facility in Chennai.

In dosi, we see decreasing level of activity versus last year. We faced some headwinds in the U.S. and the Chinese markets. So in conclusion on the order intake, I would say that it's a very encouraging one, confirming the added value of all solutions to all customers and the positioning of the IBA Group portfolio of activities.

Of course, '25 is not ended yet, and we will keep you informed on the order intake progresses that we will realize in the next weeks. In terms of backlog of equipments and services, it is maintained at EUR 1.3 billion, a slight decrease of -- decrease of EUR 0.1 billion versus Q3 2024. Let's say, it's more or less stable after the strong accelerated backlog conversion that we have observed in the first half of 2025, and that is due to the higher order intake in Q3.

Finally, our net financial position amounts to EUR 60 million as working capital has continued to be impacted by the customer delays in delivery of large Proton Therapy projects in Spain and China. That being said, we see this amount as a peak and our net financial position is expected to gradually improve as from December '25, while we have secured a solid refinancing package on which we will come back in a few minutes. To give you some view on the progress that we have made across the different business segments.

First, on the clinical side, PT more specifically, we signed a memorandum of understanding with Varian at ASTRO and this memorandum aims to strengthen interoperability, enhance clinical workflow and we went also to co-develop some technologies together, including technologies in connection to our road map on DynamicARC and FLASH therapy.

We see also a very good momentum for Proton Therapy supported by the growing clinical evidences. In particular, we have seen an exciting first ever Level 1 clinical evidence provided by MD Anderson that demonstrates Proton Therapy's benefit in head and neck cancer versus conventional radiation therapy, offering same tumor control with reduced side effects and most importantly, improved survival rates.

We see also strong commercial traction in APAC, which is reflected in our order intake and the pipeline in the U.S. remains quite active as well. Regarding NHa, our partnership in carbon therapy, the installation works of the first system are progressing and the financing efforts are ongoing in parallel to cover related costs.

Going to dosimetry, like I said, we face some regional-specific challenges in the U.S. due to local competition. We have also some headwinds in China. We have closed the acquisition of the Berlin-based PhantomX company at the end of October '25. As you may have seen in our press release, PhantomX is a commercial stage company recognized for its advanced anthropomorphic phantoms, which are used in quality assurance for AI solutions in medical imaging.

Now going to IBA Technology side. In the industrial segment, we see a continuing regulatory pressure on ETO sterilization, supporting the long-term shift towards e-beams and X-ray technology. We see also sustained progress on new applications like polymers, like PFAS with IBAs increased presence at specialized conferences and workbooks.

On Radiopharma solutions, there are strong commercials and good commercial traction, which is reflected in sales, both in emerging and mature markets. We see very exciting times in Theranostics with increasing industry interest in nuclear medicine and especially from major pharma companies with particular focus on alpha emitters such as Actinium-225 and Astatine-211.

Now I propose to discuss the financing package that we concluded in its rationale. Maybe first, as a reminder, we had undertaken a review of our financial structure considering 3 elements: first, the past and expected evolution of the business. Second, the expected evolution of working capital; and 3, possible investment opportunities.

This review resulted in the closing of a refinancing package, including a EUR 125 million bank club deal with different tranches and a EUR 10 million subordinated loan from Wallonie had performed.

The refinancing addresses 3 objectives. First one is the consolidation of IBA's balance sheet, acknowledging that past investment in long-term assets like PanTera, like NHa, like mi2, that those investments had been funded by operating cash flows and not long-term financing. Second, we want to increase our resilience in a volatile context.

And third, we want to build firepower to capture possible inorganic growth opportunities, of course, opportunities meeting our investment criteria and especially being related to IBA markets and being accretive. Out of the EUR 135 million financing package, EUR 60 million has been drawn so far. Thomas will now further detail the current and intended use of funds as well as the key terms and conditions of the facilities.

Thank you, Catherine. So you will see on this slide our intended allocation of the use of these credit facilities. So on the right-hand side, you find the different tranches of funding. On the left-hand side, potential uses for this.

First of all, starting at the top, you will see the EUR 10 million subordinated loan and basically EUR 30 million drawn under the EUR 50 million 5-year term loan immediately reinforcing the long-term funding components of the balance sheet, which is the first item highlighted by Catherine in our financing strategy.

Then we have an unused portion under this 5-year term loan amounting to EUR 20 million, which is available to cover more structural working capital over the medium term, let's think, for instance, of our Spanish Proton Therapy projects as well as to fund investment opportunities, while the latter will also benefit from specifically dedicated M&A term loan, that's the EUR 15 million tranche you see on the right-hand side.

But then at the bottom, we have EUR 60 million of revolving credit facilities aiming to address short-term working capital fluctuations. Note that they can also play a usual role considering that some geographies in which we operate do not allow straightforward cash management solutions, namely India and China, for instance.

And this from time to time can create imbalances between group entities having excess cash, while IBA SA in Belgium, where manufacturing, R&D and SQ activities take place may have some needs. And so those revolving credit facilities can accommodate for those intragroup cash management opportunities or challenges as well.

So you see on this slide, basically, again, an overview of the different tranches of funding and the amounts already drawn versus what remains available. So EUR 61 million drawn so far, leaving EUR 74 million available. Time-wise, we have 6 months to consider drawing additional tranches under the EUR 50 million term loan and still 24 months under the acquisition term loan facility. We will regularly review the use of these credit lines going forward in function of the evolution of working capital, temporary and structural and as well as business opportunities.

Now a few words on the terms and conditions. Bank facilities are based on a floating rate, so typically EURIBOR plus the margin and that margin is in line with our previous credit lines. Financial covenants also follow our previous standards and consist in a maximum net leverage ratio and a minimum level of corrected equity, corrected because equity then in this case includes subordinated loans.

The net leverage is calculated on the net debt, excluding subordinated debts and the last 12 months of EBITDA. The net leverage covenant provides for a maximum of 3x. Besides, as customary within the club deal documentation framework, IVS to comply with certain undertakings related amongst others to M&A disposal assets or others.

Now moving to the conclusion. We have in place a financing structure that is secured with a 5 years commitment from the financing partners, optimized. As Catherine said, the idea was definitely to have a package addressing an adequate mix of long term versus short term on the liability side and funding versus the asset side.

Flexible to be able to address working capital volatility and as well to be able to flexibly in an agile way to capture investment opportunities and as well robust given the support of strong financing partners that you see listed on the right-hand side of the slide, so a pool of 4 banks and as well Wallonie Entreprendre, our long-standing financing partner.

So we see the opportunity really to thank all of them for their trust and long-term commitment to IBA success. We are now ready to take your questions.

[Operator Instructions] So first question is from David.

Maybe first, on the refinancing, I didn't hear it. So can you come back on the covenants and maybe give us details about the cost of the financing? And can you confirm that you're actually not planning to use -- so in your budget to use to draw the [ FCM ] as in Slide 7. That's my first question, and then I have 2 more. But maybe we can start with this one.

Okay. Thank you, David. So first part of the question is related to the covenants. So basically, and it is currently the case today, we have 2 covenants, 2 financial covenants. First one is the net leverage ratio. So comparing the net debt excluding subordinated debt and the last 12 months EBITDA, so it's calculated on a rolling basis.

And we have to comply with a level of maximum 3x. The second covenant is a minimum level of corrected equity. And why is it corrected? It's because it's including the subordinated debt as banks consider its equity from -- for that purpose. So I assume it's clear. So on the cost, then of course, as you can imagine, it's the exact level of margin is a confidential element from a bank perspective as well.

And so we can only comment that we stay with a similar level of interest rate and margin basically as the current credit lines. So if you look at the average use of those credit facilities over the last period of time versus the interest charges on our P&L, you will have an idea of what you can expect for the future.

The last question relates to the use of the revolving credit facilities specifically. So currently, we have drawn EUR 20 million out of the available EUR 60 million. We've commented on the expected treasury trajectory with improvements indeed versus the current position starting from the end of this year and improving over the next year, most of is tied to the delivery of our large Proton Therapy projects, namely in China and Spain.

So definitely, use should reduce over time. I also commented on intragroup cash allocation that may require from time to time use of this credit lines. So this should not come as a surprise, if you maintain some use. But the idea that these are used a shorter-term type of buffer.

And my second question, you anticipated a bit. It's on the Ortega contract deliveries for the year and for next year. Maybe you can also comment on the Chinese contract. What is reasonable to expect maybe to give us a range, not necessarily precise, but a rough indication of how many project you expect basically for which you expect payment actually this year and then next year?

Yes. I think on this one, we remain quite aligned with what we already mentioned at the moment of the publication of Q2 results. So -- to summarize, we have guarantee manufacturers 3 machines out of the 10 that have been ordered, 1 has been shipped. That's something that we already mentioned in Q2 results that we intended to ship in October. It has been done by the end of October, beginning of November.

And so we expect to receive the payment on this machine in December conform to the terms we have in the contract. The second and the third machines will be shipped next year in the course normally of Q2 for 1, end of Q2, beginning of Q3 for the third one. And in terms of payments related to all these 10 machines, you may remember that we mentioned that's the working capital impact linked to the delay was close to EUR 30 million. It is a [ 1/3, 1/3, 1/3 ] by machine, let's say.

Do you mean that above the 7, the remain -- your talking about the remaining 7 or...

So that was on the first 3 that we already manufactured. On the remaining 7, we will change a little bit the way we manufacture them. And so instead of starting to manufacture as soon as we can to be ready to ship from the moment that the customer is ready with the building of the hospitals.

We will wait before doing the manufacturing, we will wait to have strong signals that the building will be at the moment that we can ship the machine, so there must still be some kind of delay at certain point of the time, and we want to remain a little bit flexible in the interest, of course, of the patient, but the general principle is that we will not start building the machine as long as we don't have very strong signals that the hospital can accommodate the equipment to avoid this strong working capital impact that we had on the first 3 machines.

And is it fair to say then that the remaining 7 will be for beyond 2026?

It's -- so it will be spread over the entire term of the contract. But indeed, it's fair to say that the shipment of the remaining 7 will be after 2026, yes.

And last question from my side is on the PT, the Proton Therapy services. With a question of how you've been monitoring, I would say, more the credit risk aspect of your customer. My question is also a bit related to the recent controversy in the Netherlands that some centers would be underutilized and 1 was facing more acute financial difficulties. If you can comment on this, it's a bit too different topic, but I think they're related?

So maybe on the credit risk linked to the customers. That's, of course, something that we monitor at the moment that the contracts closed. Where we do a number of analytics on this sort of ability of the customers, the ability to pay for the equipment on the 1 hand and then later for the services that the hospital intends to consolidate.

Of course, during the course of the year and depending on the evolution of the revenues of the hospital we might see some volatility compared to what the first rate assessment that we did then we managed together with the customer, relatively proactive way and we try always to find solutions that could benefit all the parties. So in the best interest of all the stakeholders.

So that's on the credit, let's say, question. On the fact that some hospital not necessarily let's say, fully booked the availability of the rooms in which big equipments are installed. So it's true that sometimes it can take a little bit more time. So it's a little bit longer for a hospital to build a room, but of course, it's in the best interest of everyone to try to maximize the use of the room.

And so that's something in which we can possibly advise hospitals, what they can do, how long it takes to take 1 patients or it can, let's say, or the installation can use a bit maximum capacity. But at the end, of course, it's something that the hospitals have to implement.

I think in some cases, we're seeing these hospitals are having full use of the capacity. In other case, we see a hospital having a very high use. I think that the maximum, which has been reached until now is 64 patients being treated over 1 day. So you see it's very much depending on 1 hospital to another.

Any comment on the lines on your performance?

And what is -- you mean on the study, which was published on the Proton Therapy.

Not the study, but that one center was I'm just quoting the article. And so I don't know, if it's correct, but that one center was particularly in the difficult financial situation?

I must admit that I didn't see the article honestly. So I can't comment, because it's a specific question, but I would be happy if you can send to the team the link of the article, and I will come back to you maybe with any specific comments to be provided.

So David, thank you for your questions. We have further questions from Laura.

I have 3. So first of all, could you comment on backlog conversion for H2. Because it was very strong in H1. So I was wondering how did it look like then in Q3? And what can we expect for the remainder of the year? Then you mentioned in dosimetry that you were facing some headwinds? I was wondering to what extent this would impact the full year performance of that division?

And then the last one on CGN. Do you have any update from them? Do you expect any until the end of the year? That's it.

Okay. Laura. So I will address the first question, and then Catherine and Olivier will answer the other 2. So the first question relates to backlog conversion over H2 and it was a very active H1, and we are increasing the pace in H2. Definitely, so far, it should be visible in the numbers. And this being said, it will be less imbalanced as last year in terms of H1 versus H2 weighting.

So yes, we're definitely on the right trajectory to reach ultimately the targets that we have reconfirmed as part of our press release, today.

Okay. If you don't have any further question on the backlog, I will continue on dosi. So like I was indeed mentioning, we saw some kind of headwinds in this mainly due to, let's say, competition that we see coming with some product that we don't have yet.

So in order to come back to the level that we internally anticipated, we might have to do limited acquisitions. That's the reason why we started with 1 PhantomX, but we might have to do a few and very limited others. On your question whether we expect an impact, I understood on the guidance that we have provided. The answer is clearly no.

So it's, let's say, headwinds compared to internal targets that we had. But all in all, and having in mind all the segments in which we operate and all the activities we have we don't expect any impact on the guidance that we communicated to the market.

Could you specify your question on CGM? I'm not sure I see an immediate answer. So it would be great if you could spell it out again.

Yes. I was just wondering, if you has any update from them, any contracts, if you see any activity from their side?

Nothing outstanding, Laura. I think there are a few public tenders for the moment in the Chinese market, where we are active, but there is nothing meaningful to mention at this stage.

So nothing really different compared to what we have said so far.

I think, lastly, we confirm that they are as part of the partnership agreement. So they have basically executed the technology transfer part, and they have the facility, the factory for local manufacturing that is ready to go. Now the main area of focus is on the market developments and getting the sales convergence.

At this stage we don't see any product open questions. So we have, I would say, last chance slots, if anyone willing to show the question. In the meantime, we can already tell you so the presentation will be available on our website in the same link shortly after this call.

So I think, if there are no more questions, I would like to thank you again for your attendance to this call. It was a pleasure for us to have the opportunity to answer your questions. And we wish you a good evening/good afternoon/end of morning.

Have a good day. That might be -- thank you very much.

Thank you.