Lectra Aktie

Good morning to all. Thanks for joining us this morning. So the shareholders' meeting is broadcast live on the Internet, translated into English. We have people online and all our major shareholders.

The agenda for the day, I'll introduce the speakers, then we'll have the opening formalities and with Olivier will present the key highlights and results 2025 before question and answers. Sorry for those online. Questions and answers will only be in the room, and then we'll have reading of the statutory auditors' reports, presentation and voting on resolutions and closure of the meeting.

Speakers, Celine Abecassis here present, who will address core compensation; Anne Borfiga next to me; Olivier du Chesnay on the other side. Flora Camp, Aurelie Lalanne, Jean-Christophe Pernet, statutory auditors in the front row. Thank you.

So I'll hand over to Anne for the opening formalities of the meeting.

Thank you. Good morning. So as you know, we need a bureau that is made up of Daniel Harari, who will chair the meeting as Chairman of the Board; 2 scrutineers, Jerome Viala and Jean-Pernet, Olivier who's agreed to be the second scrutineer. Thank you, Jerome, Jean-Pernet, and I will act as meeting Secretary.

So just a brief reminder shown on screen is the schedule around the convening of the shareholders' meeting with the various dates that, I won't go through. Just all formalities were complied with within the legal time frame and all documents pertaining to this meeting are available on Lectra's website or made available to you at the Paris head office.

So if we move now to the quorum, we've just recovered the quorum. Over 90% is the quorum. So we can, therefore, begin this meeting, and we can, therefore, deliberate and take valid decisions. I won't go into the details of quorum calculation. We have over 90% of votes that represented essentially votes online and some of you will today as you entered the room.

So that's for the formalities we can begin. So the documents are available at the meeting. Everything is fine. We can get underway. We're going to hand over to Daniel in a moment, who will run through the highlights of 2025 and then Olivier, who will discuss the 2025 financial results.

I have a very important mission here is not to fall behind the stage. There's a bit of a trap there. I want to be here next year. So just going back over the highlights for 2025 was full of market events in 2025, a lot of activity on our market. So 3 main highlights mark 2025.

First of all, economic and geopolitical uncertainty that followed the April 2 liberation day introduction of tariffs, very difficult to understand. Generally speaking, zero announcements made by President Trump applied as announced. We had to look at the implementation orders once by one. There were major repercussions.

For example, the major fashion suppliers in Asia went from positive to plus 5% down to negative 15% real upheavals unable to export at all to the U.S. and then limited decrease of revenue, thanks to recurring revenues and transformation towards SaaS, tight cost management last year, another year of strong free cash flow generation and negative working capital strengthening an already robust financial position.

When we look at how our markets evolved, firstly, fashion. The chart top left shows that within a space of 2 months -- of a few months, there was a transfer of countries in which we were manufacturing apparel, strongly in Asia with a drop in China and impacts in other countries. As announcements unfolded, the situation changes and customers shifted their orders from one country to another. This disruption was heightened and our customers were in wait-and-see mode before investing.

When we look at the 2026 outlook, we now know a bit more, but clothing retail sales were stable in 2025. But in fact, they increased early '26 in fashion. Luxury is today disrupted by the war in Iran, but overall held up well. Everyone was worried about luxury sales levels. And of course, international policy remains uncertain, driven by the war in Iran, far simpler to read because everyone is talking about it, whereas tariffs, no one was talking about it. So it was more difficult to explain the effects.

When we look at the automotive market, perhaps key point. As for fashion, the year 2025 was stable. Everyone was talking about automotive crisis, but production was stable. Sales were stable. What actually happened is that knowing that the automotive sector remains a local market that is we manufacture close to where we sell.

The real revolution automotive came from the first place taken in e-vehicles by China, very strong in China. There are 120 EV brands. The government is seeking to reduce that number to 20 over the next 5 years.

And the main play, BYD has cut its prices by 30% in China to get others to fold or to consolidate the market with a strong reaction in China, ripples across Asia, also in Europe because Asian manufacturers are coming to Europe, threatening European manufacturers idea of doing the rounds. They were subsidized by the Chinese government.

Well, that's no longer the case for a number of years now. And actual Chinese consumers had advantages to buy an EV. It's the case across the world. And put simply, it takes 3 months to design a new BYD, takes 3 years to design a new VW. So they're far better in production, in design, in quality.

So today, the Chinese industry is in the lead and has led the European manufacturers to adopt a defensive mode. The U.S. market, there are no sale of Chinese vehicles in the U.S.

Turning to furniture, slight growth in the market there. What disrupted the market with tariffs, which are higher on furniture than other markets because there was a lobby in the U.S. to protect the furniture market that has a very considerable level of manufacture in the U.S. And these tariffs are higher than they are today for fashion and for automotive.

Second point that impacted generally, you sell -- you change your furniture when you move and real estate market was badly hit, fewer moves, less furniture board, but sales remain stable. No crisis situation on the whole.

Today, 3 months is a year. That is to say the situation at the end of March was different to that we saw at the end of December. But overall, what we can say is that retail fashion sales are up significantly in Q1 that automotive sales declined in Q1 across the world and furniture sales are holding up with changes.

We're manufacturing more in the U.S., less in China because import costs are higher. All these markets are very disrupted by market shifts and new rules introduced.

I'm going to hand over to Olivier for the 2025 results. I'll come back the road map in a few minutes.

Thank you, Daniel. Good morning. I'll just run through the 2025 results a few months back. So the method -- look at the top right of this slide, we are beginning this year with recurring and then nonrecurring and then the P&L.

The first indicator is the ARR, annual recurring revenues, the performance indicator on our SaaS offers. Early '25, we're at EUR 88.9 million ARR with a growth of 14% across 2025 to reach EUR 101 million.

When I look at these 2 numbers using the same exchange rate, it's exchange rate of balance sheet, it's 1.04. But when we report a level of ARR at the actual exchange rate at the end of December '25 is 1.17. That's why ARR at the end of 2025 stood at 97.2, 40% growth with for '26, '27 -- '26, '28, we're targeting 15% growth. So all our offers have found their customers in SaaS for 2025. So that was for ARR.

Let's turn now to revenue. So recurring revenues that accounts for 75% of total revenue, the box in the center, we see that recurring revenues up 2% in 2025 versus 2024. Don't be surprised by the size of the columns in terms of method, the size of the '24 column using the average exchange rates of 2024 and for '25, the average exchange rate is 25, there was a lag '24, '25. The dollar weakened '25, but like-for-like, plus 2%. There are 2 parts.

On the left, you have recurring contract revenues. Recurring contracts, 3 types in SaaS subscriptions from the ARR orders, the timing between the order intake and the SaaS revenues, SaaS, Software-as-a-Service, that we sell subscription SaaS revenue grew by 14% in 2025.

And then we have the software maintenance contracts, software sold with a perpetual license. Most of our new offers are sold SaaS. It's going to reduce over time. You see the decrease is modest single-digit. And last year, you have the revenue maintenance contract. Every time we sell equipment, we have maintenance contract. That was up 2%, slightly weaker than in previous year linked to renegotiations with customers and with the macro situation.

Second component on the right, consumables and parts are sold when the customers' plants run 2025 with tariffs, with macroeconomic context, we have a decline in macro, but revenue, consumables and parts only decreased by 40%, resilient in a challenging macro context. At the end of the year, we had that 4% trend, and we've seen no recovery at the end of 2025.

I'm now moving to nonrecurring activity. Here, we always start with orders. So these are the orders of new system, new systems, equipment, perpetual software license and training consultant. On the left, you have all the orders of the year.

Total orders for the years in 2025 were up minus 17% versus 2024. And the year was different. We started out at plus 2% the year before liberation date and then a decrease in subsequent quarters of the order of 20% per quarter. But the amount we booked in orders stabilized in Q2, Q3, Q4 2025. This 17% decrease isn't similar across regions.

On the right, you have the breakdown of the left number by region, the region hardest hit. Asia Pacific, it was down 26% over the previous year, got off to a good start in 2025 was the most affected by the tariff was in 2025, decreased 26%.

Americas, slightly down 14%. Europe held up better. America also hit by tariffs because part of our activities done in Mexico at the beginning of the year, tariff war between Mexico and the U.S. And lastly, on the right, you have the rest of the world, North African countries, Turkey, Egypt, there we had different types of movements, Egypt up, Turkey down.

Still these orders, the same information, but by sectoral market so fashion, furniture, automotive that Daniel mentioned previously, the most impacted market is the second cartridge, automotive, a big slowdown in investments in '25 versus '24 with a decrease in investments by 30% in our customers. Automotive has 25 clients representing 80% of our revenues. So those clients, once they've decided to stop their CapEx they can stop quite soon.

Fashion, our leading market, down 14% last year, impacted by tariffs. We still have -- it's the leading market, but down 14%. Furniture as long as we see no pickup in activity on furniture and real estate will be down by some 30%.

Other industries, aeronautical, technical textiles. These are investment cycles are rather different, less exposed to the macro context. Last year, we had up 21%, about EUR 14 million.

So from orders, we move to revenues. So the orders are on the left, minus 17% orders between '25, '24, and you find the various types of orders of new systems. You have the software perpetual license equipment, training, consulting, minus 17% of orders, but only minus 12% on the right of revenues. Why? At the end of 2025, we delved into the order. We had less ordering because we delivered more than the order intake. That will impact the Q1 revenues that we reported last night.

So recurring activity, nonrecurring activity. If we turn to the P&L. Here, you have the main aggregates of the P&L growth in recurring revenue that accounts for 75% of the total, but decrease nonrecurring. That's a decrease by 2%.

Total decrease of total revenue, no decrease in the gross margin. That's to say we've sold better in terms of margin between '24 and '25.

Overhead slightly up. We'd increased salaries early in 2025. We offset this increase through cost reduction, but full year '25, we were still up that our recurring EBITDA and EBIT are down with an EBITDA of almost EUR 80 million full year 2025. So a decrease linked to that part of the activity.

This slide just summarizes all the items between '24, the result generated in 2024, EBITDA and 2025. Between the first 2 columns, you have a small amount that's EUR 0.3 million is linked to the fact that in '24, we did the acquisition of Launchmetrics 26 days after the 1st of January. We have a scope effect neutralized with 26 days.

And you see that between EBITDA '24 and 2025, EUR 91.4 million and EUR 84.4 million, the various effects on EBITDA, either revenue or cost related. You see the first that negatively impacted EBITDA in '25. We had less order intake, less activity on nonrecurring revenue.

But you see the revenue recurring contracts, that's the green bar, 11.3% contributed positively. We had growth of 5% revenue recurring contracts and its revenue with a high margin. It contributes strongly to group profitability, and then fixed costs that decided a bit that lowered EBITDA to arrive at EUR 84.4 million EBITDA using the '24 exchange rates, better for us and the never effect in exchange rates because the dollar went to EUR 1.13 to EUR 1.16 full year 2025.

A few bits and pieces about the balance sheet. It still is very sound. We have very little debt. The financial debt is less than EUR 100 million. It actually is EUR 86.4 million at 31 December 2025. We look at the cash, EUR 65 million. And so the net debt stands at EUR 21 million. So we are very little leveraged compared to the competition.

And then cash flow, and that is, of course, what enabled us to have so little by way of debt. The year 2024 was historic because we had EUR 160 million in cash -- sorry, EUR 71 million. now we have only EUR 75 million -- EUR 55 million -- EUR 57 million. Now it looks like a lot less, but still EUR 57 million is quite significant in '25. And we can see that WCR is negative because we're not consuming any resources at all.

And now Daniel will have the floor.

All right. Thank you, Olivier. Let's go to the strategic road map of the 3 preceding years. You may remember that in 2023, we suggested that we should monitor this on an annual -- year-by-year on an annual basis. But if you go back to the story so far in the 50 years of Lectra, we had 4 different strategies.

The present one is Lectra 4.0. That's the fourth strategy that was launched in 2017 with 3-year plans, and we have implemented and monitored that plan. And so we had reports at the AGM, but of course, throughout the year at Board meetings.

So if you look at the period 2023 to 2025, right up there on the screen, you can see that there were 3 objectives: number one, we wanted to take full advantage of the new scope of the company to gain in growth. We had bought back Gerber, who was our main competitors in 2024.

And we generated synergies, not just in terms of efficiency, but costs in absolute terms because we're looking at EUR 12 million to EUR 18 million in cost savings by bringing the 2 companies together.

If you look at the profits of both companies, plus EUR 18 million. In fact, we got at EUR 40 million additional savings in 2025. So we have a plus or minus. Why? Because we certainly took advantage of the synergy, but we didn't generate much more in terms of revenue in view of what Olivier said.

So in terms of profitability, we were shielded. But unfortunately, there was not much growth by way of revenue. Then we want to increase the share of SaaS in total revenues. You may remember what Olivier told you, this is something we worked hard on, and we developed quite nicely.

But then the third part of the strategy was to take external growth opportunities. There were 2 significant acquisitions, TextileGenesis, and they engage in traceability and then Launchmetrics. That's what Olivier mentioned earlier on this is marketing on the fashion industry.

On the fashion market. Now -- if you look at the situation 3 years down the road, our market position is unrivaled. We have a leadership position on all markets.

Our offer is robust, relevant in line with the market expectations. Most SaaS offers were launched anywhere between 2018 and 2022, and they all were well received by the markets. We have dozens, if not hundreds of customers using them on a daily basis. It's only just beginning.

We doubled our size with Gerber, but also Launchmetrics. We have a global footprint and the revenue is well balanced around territories and our image as a technological company has been boosted. We got lots of awards for innovation, but we were also recognized by our clients as being very relevant to meet their concerns.

Now then in terms of revenue, we have 75% of recurring revenue. We have a security ratio, 75%. What's that? That's an indicator we set up a few years ago. It looks at the percentage of overheads as a ratio to recurring revenue. So you work out the gross margin, and that covers 96% of overheads.

So no matter what happens, and we can see this in Q1, even if we're not doing as good as we would like, we still are coming out ahead and across the breakeven is reached sometime in mid-January. Very few companies are in this fortunate position not to be poised to lose money.

Net debt is very low, EUR 21 billion and free cash flow high at EUR 57 million again. Now going back to the strategic road map that was announced in February, this new 3-year period. So we are stepping up the plane. I mean, this is the extension well, with some adjustments, but still, we're basically gearing up the plan.

So right now, we are using 4 key technologies, artificial intelligence, and for the past few years, generative AI, agentic AI for some time now are 2 major technologies. You have the Internet of Things and all our software is connected to our expert centers, and so we can monitor what our customers are doing.

We have the cloud, 100% of our apps are in the cloud and big data because we're talking about billions of data being processed with what is known as fuzzy data, data that is not structured. If you look at, let's say, all sites where clothes are sold, we have a general idea. We don't know exactly what goes on, but we can piece things together using artificial intelligence.

So based on these fuzzy data, we can come up with much more specific results. Anyway, Lectra has been using this for a number of years. Since 2015, indeed even before we announced 4.0, all pillars of Lectra were built using that technology. And historically, we've been always controlling mechanics, electronics and software development.

And we said that the next 3 years would be marked by 2 structural changes. Number one, we have the development of 4.0. And of course, artificial intelligence went a lot faster than expected because there were major announcements back in February. Anthropic, as you know, is one of the giants of artificial intelligence. They came up with Claude 4.6 and in the world of software, when you say a minor development, you think it's not much.

But here, in fact, 4.5 was doing more or less the same thing, but it was not doing it well, whereas 4.6 does it well, beautifully, in fact. And the big difference is that it used to be you could develop 20% to 30% of our software code with the help of AI. And now when that new version came out, it was like we went to 90% of the software can be generated without any mistake. So this was a paradigm shift, and we had planned this, but we expected. We didn't expect this till end 2028.

So we believe this is -- will be an opportunity for Lectra. But we use, of course, these new technologies, especially as we develop our software. in a very intensive way, but we're agnostic in terms of publishers. We can use any kind of agentic AI, any kind of generative AI to develop our software. And in fact, we are independent of cloud suppliers. So we are not -- we will not find ourselves in the situations where our hands are tied with Microsoft or Amazon or the likes.

So this is a new deal, a new paradigm, and we were -- well, we were prepared for this, but this is happening faster than expected. And the second item on the right-hand side, we -- back then, we thought that -- well, there was constant uncertainty in global markets, geopolitical concerns.

Back then at the analyst conference back in February and in all the meetings we had afterwards, but does this mean that we will be selling less by way of equipment? Or will there be -- will we reach a low point? And I said, if there's no war, we will hit rock bottom. And 2 weeks later, there was a war. And so of course, a lot of disruptions.

And this is complex because our #1 enemy is uncertainty when our customers are uncertain, they wait and see. And the second enemy is access to cash. And when -- well, of course, when times are hard, people hang on to their cash to provide some sustainability. They said, no matter what, I can't invest because I have to have enough cash to go around. I don't want to have to close down, or lay off 30% or 40% of my staff. And these events occurred just a few days after our announcement, and this will, of course, inform everything that we do.

Now, if you look at our offer, this is the way it is structured. We have 5 software platforms, one on creation. So we still have our legacy software or historic software, but we'll have a new platform, which will provide the next generation.

We have one platform for manufacturers called Valia, one for market. So this has 3 offers, Launchmetrics, Neteven and Retviews, and this will be combined into a single platform. We have one traceability platform.

So we start from the cotton field or from the cow and we -- you go back to the -- well, we trace back the history of the cotton or the leather, just like the blockchain for virtual currencies, and that will guarantee the authenticity of the cotton or the leather.

So we have about 200 major accounts. 60 of them have gone for that traceability. We got 48 contracts for traceability. Our competition only got 12. And this is growing exponentially because this business model is proportional to the volume of traffic on the platform. There's more volume because people put more and more products and more and more collections.

So this is a virtuous cycle, a few figures. We have EUR 4 billion worth of products that went through the platform in 2025, 25,000 companies throughout the supply chain from the very raw materials, cotton, leather or whatnot, all the way to the final product in the store.

So it's end-to-end, the whole chain, the whole value chain. And our customers have decided to do what they do using TextileGenesis to demonstrate the virtuous dimension of their sales. It's very important in the fashion industry and products declared to be made of cotton around the world is amount for 3x the total volume of available cotton. So this is green washing and like cashmere, the figure is even worse.

I mean, when you buy something said to be cashmere, there's a chances intended that it's fake, that it's not cashmere. So traceability really does lend credibility to the claims.

And we have another platform called Kubix Link, which works a bit like Wikipedia. The strength of that is that, it doesn't require a full structure to make it work. We can adjust it on a daily basis. It's very flexible, whereas most of the software in product life cycle management needs to have settings. And if you want to change anything, you have to change everything.

Now we have much more flexibility. And as you know, the fashion industry is highly flexible. It goes quickly. If you set things in stone for 3 or 4 years, it won't -- this will not do. So some of that software that we brought about brought a lot of traction on the market was very successful. But of course, now we have to translate this into sales because, of course, these products have shown what they can do.

If you look at the key items now regarding our position in the bottom right corner, you can see that recurring revenue was more than doubled actually multiplied by 2.5 between 2016 and 2025. So in a matter of 10 years on all 3 road maps. So this is pretty impressive. Of course, it does include the acquisition of Gerber, but not just that. There was a lot of hard work that went along.

With this, we moved on to EUR 97.2 million of ARR at end 2025. As Olivier was saying, we would -- well, it would have been more than EUR 100 million were it not for the currency effect. But end of March, we were there anyway. So we generate more than EUR 100 million in SaaS well, even if it's only 20% of revenue, the margin is much higher and much more promising for the future.

Now, if you look at, amongst other strength, we have a presence in 100 countries with a prestigious customer base, mostly very large accounts, 80% of major automotive customers are electro customers and more than half only buy from us. And this has been the case for many years.

In terms of customer success, we're very close to our customers. We support them. We help them not just use our solutions, but to make the most of these solutions to optimize profitability, efficiency. We seem to be a leader in terms of innovation, but we have a unique offer in line with customer expectations, and we are at the forefront of sustainability.

CSR has always been a part of our DNA as it were. We are in the top 10 of companies in terms of sustainability. We got several awards. Now we find ourselves in a position where we were able to establish that we are indeed at the forefront of this matter, which was a source of concern, has been for many years now for better, for worse. This will take second place because everybody is more concerned about the economic situation.

But nonetheless, we have a good position in terms of sustainability. Though, we want to step things up. We have 3 years before we reach our cruising speed. And by 2028, we think we will have completed all this.

So by 2028, we have more specifically 3 objectives. Number one, we want to turn Valia into the spearhead of manufacture. We want to scale up the SaaS business. And then we want to boost operational excellence.

So of course, acquisitions can help, but the companies we acquired had their own habits, their information systems, their processes. And so we have arrived at the point where we need to have a more homogeneous system to have best practices and make sure that our information systems are simpler and more fluid.

If you look at the outlook for the next 3 years, annual growth of ARR, as we announced in February, we are expecting growth to stand at about 15%, which means that recurring contracts should grow by about 5% to 8%.

Q1 was only 4%, so slightly below that, but Q1 was, of course, impacted by the fact that in 2025, not only did we have fewer orders, but also contracts were renegotiated or some customers actually went bankrupt.

Normally, usually, our cancellation rate is about 6%, 3% because of companies closing down, or because they decide to rescind their contracts. Last time, it was not 6%, but 8%.

Anyway, we felt that when there was the tariff crisis, we were expecting to lose as much as 20%. In fact, not, we only lost an additional 2% in terms of attrition in terms of lost revenue. And in fact, we didn't deliver any new equipment in Q1. But as new equipment comes in, this should bring about new contracts as well.

So the position now should put us in -- should protect our position. And with new items coming online, we are confident in the guidelines.

So all other things being equal, I mean, that is if the level of equipment and consumables remains identical give or take inflation, we're looking at EBITDA margin growing by 121 to 180 basis points.

And if you look at the cyclical and the structural aspect, the structural aspect, we find that cyclical is that equipment level was low. But structurally, we find that our costs are down. And in fact, we're looking at more than 180 basis points EBITDA margin.

So I mean, we're waiting for equipment sales to go up, but the rest of the plan is going according to plan. And so we can confirm the objectives that were stated in February.

Now then, in the press release we published last night, there were 3 items we wanted to highlight. Number one, a highly unstable environment of Q1.

Now of course, we published a statement on 11 February, and we found that as of 12 February, people started panicking and there were no new orders between 15 February and 15 March.

The world came grinding to a halt. Everybody was afraid of the consequences of the war in Iran. But then the quarter ended well because there were quite a few orders that came in.

No, it was too late to deliver them in Q1. So we found ourselves in a position where the order book, the backlog of deliverables is quite significant as of 31 March. And that means that Q2 will be a lot better than Q1 because the order book has EUR 25 million in equipment, of which 80% are deliverable in Q2, so EUR 20 million. And last year, the whole revenue for the year was EUR 22 million. So we can see that just about all that revenue on equipment is right there.

Well, of course, there could be a surprise in Q1. We had the late delivery of orders, but then deliveries because of the closing of almost boats have got to go through other routes. And of course, the other major disruptions could disrupt the situation. But of course, the situation is pretty comfortable.

Regarding the war in Iran, we believe that, of course, it will have a major macroeconomic impact. It will have consequences on inflation, on growth in various countries. And indeed, this will reshuffle the position in macro -- in geopolitical terms, what with Russia, China and the U.S. changing -- shifting positions. But for us, this shouldn't have much consequence.

Worried about the fear factor, obviously, when things calm, the fear recedes, but tariffs had a major impact. To illustrate that, if you're an Indian customer, our customers work either for Europe, for the U.S. or the Asian market, rarely the 3 at once, you're an Indian customer, you're working for the India. India is our second largest market of outsourcing on fashion.

So April 2, you're a friend of the U.S. and you're going to have the lowest tariffs in the world. And so you're really king of the world, you begin to reinvest, you hire people, everything is fine and rosy, then you become the U.S. enemy because you're buying all from the Russians and you go from 80 -- it was 10% tariffs. You go from 10% tariffs up to 60% tariffs and no way of absorbing the additional 50%.

What do you do? Do I shut down? Do I lay off half my people? I've got cash to last 3 months. I'll sit on it. I need the 3 months, so it doesn't push you to buy equipment. And since the start of the year, before even the U.S. Court of Justice rejected the tariffs put in place, India had moved to 18%. It's become acceptable to buy Russian oil until you buy Venezuelan or U.S.

India has moved from the most favored nation to the least favored nation to the most favored nation. All that, of course, has an impact on us. Tariffs in China moved from 20% December 31, '24 to 40% decisions taken by Biden in -- during his term of office, March 31, 2025.

And then Trump expressed the differential versus the 40%. And it went up to plus 145% compared to when you've got 200% tariffs, you can't import. That's for sure. And the imports of China stopped.

And then there were discussions and agreement was reached at plus 30% following the great logic of announcements that don't say the reality, 30% plus December 31, not March 31, they're raising the decisions taken by the Biden administration compared to what they were the previous Trump plus 30 -- the 30% were just 10% all in all, the discussion directly with the Chinese Prime Minister in October 2025 tariff cuts, 20%.

In the end of the day, only country where tariffs didn't increase was China. Everyone took away that China was the trade enemy of the U.S. with a sharp hike in tariffs.

Our clients who export to the U.S., 20% to 40% to 200% in tariffs back to 40%. We're not in a stable situation. That's why the year was highly disrupted. Since the U.S. Court decision, we find the previous plus 10%. 10% is absorbable. You increase prices by 1/3, pass 1/3. You assume 1/3, it's absorbable. We've arrived at a situation today if it isn't challenged in the coming months that ends the first period and opens up a period of stability.

People have understood the situation, have got used to it. It's led to shifts in countries as we saw. China has lost a lot of market share for the U.S., Vietnam gained. It was a yoyo effect in India, all that's going to stabilize, and we expect to return to a normal situation. It was the case in Q1. We're not sure it's going to continue because the world is unstable.

Third key factor is acceleration, thanks to agentic AI. So when we put out our February results, the first thing that happened that certain shareholders found them bad. So the share price dropped 5%. that's of the case where you have a quick look at the results.

Then we went an hour a couple of hours later. It was plus 5% in the share price. Shareholders who knows were buying, because said, right, the numbers are good.

And then we lost 33% because of the SaaS situation, a fact that the markets called SaaSpocalypse. A number of analysts declared that never be software, that software was done, no future for SaaS. And thanks to AI, that would all disappear. It's a bit of a short cut. We're far from that happening, firstly, because this assessment was done without discernment depending on the situation, it varies.

If we use market data and we run AI agents, of course, we can obtain results. If we don't have the data, we can't do any trend of Lectra. We own all our data, including all those that transform our customer data, that is we own the IP to improve our software platforms and the construction of AI agents. No customer can do it alone, only has access to its own data, not other market data. It's only useful if you can compare and leverage market data.

We're well established with our customers, with the software embedded in their process take computer-aided design. Our first business, a customer who want to replace our CAD software by another, would cost him 10x what he pays every year. Why? Because all the data are inherent to the software, all the process, it costs far more to change than to stay.

In the worst year in our history, we lost 1% of our customers our CAD installed base. So we see that we're really adhere to the customer process. There's this stickiness ditto for Kubix and PLM when a customer changes after 10 years, but he doesn't change.

Valia was profoundly rooted in our customer processes. Today, we don't feel threatened by this situation. On the contrary, we believe it's a great opportunity because for 40 years now, we've been in AI. We used all types of AI over the 40-year period and the revolution of agentic AI. We've been going flat out for 2 years with full throttle for 2 years. It's a great opportunity.

We're ready. We're going to be able to leverage everything we're doing. Our customers can't do it alone for anything that is really complicated.

For simple stuff, yes, but not on the level of what we produce. And people ask me, will our customers do it, but it's not the right -- will they do it profitably? They'll do it, but the first test, it cost them 10x, 100x what we invoice, who wants to spend 10x more to do it yourself.

It's an illusion. And when we look at our peers, they have access to less data, they're less integrated, a lower starting point. So once we put in place all the AI tools, what's going to happen is that we're going to increase the distance versus our peers. It's not going to shrink that lead.

So we see this as a major opportunity. It's what that created the drop of all software of Lectra in February. We think it's a misread of the situation, and we'll hope we'll recognize it gradually as we deliver the numbers going forward.

And thank you, and we're ready to take your questions.

Do we have questions in the room? No questions? It's very crystal clear, Daniel. I will give you the microphone, yes. Just wait for a moment.

Jean-Pierre Tabarts. I seem to be understanding in the subtext here that the single platform around Kubix Link, textile genesis, launch metrics, perhaps also gives us the impression that we're entering a period where we're consolidating everything we bought left, right and center. I mean, there's no judgment in what I'm saying here. Is that what we should be hearing?

Yes, that's what you should be -- we're entering a period of consolidation and also integration that is stronger. But there's one thing that isn't right. We have 5 platforms and not one. And that deliberate choice was made because notably in fashion. We have 5 different platforms because a creator doesn't think like somebody in design talks about the concept of color isn't the same for someone who produces or who sells.

So in fact, to have a single platform is going to lead to semantics that is recognized by no one, and it would have prevented teams from taking our solutions thinking they couldn't speak the language. So we did the independent platforms that speak the language of users, but also a database that takes those data, makes them uniform. It was a very wise choice versus a single platform because AI allows us to accelerate this integration and this unique language to have very elaborate dictionary, something we were doing without this advanced Agentic AI, we can accelerate a lot.

It gives us a strength, because when you're in a team that defines the product, say, in a luxury company, you don't think about the 5 -- we're going to be using those products. And you're not speaking -- so we translate that into the person who use it. Obviously, it's infinitely more efficient than having a common language that no one recognizes 5 platforms with AI, that's going to integrate. That integration is going to accelerate.

In terms of the business, it's precisely that we have 3 solutions that have reached an advanced degree of maturity in terms of volume and profitability. We're setting ourselves a target. It's the 40% rule as it's known.

We want the growth rate should innovate, plus the margin, the EBITDA should be more than 40%. In other words, growth is 15%, EBITDA is 25%. And our goal at the end of '25 because we're on the right track. At the very least, launch metric, textile Genesis and Kubix should be in that logic over 40%, and we have mature offers where today, we're reaching critical mass.

So we have a critical mass effect linking that the margin increases. It outstrips ARR. And year after year, we generate more revenues. Just returning to launch metrics, which represents about half our SaaS revenue.

When we started discussions with launch metrics, they're about 12% ARR growth, but they had negative EBITDA of 23%. Today, launch metrics in 2025 delivered EBITDA of over 25%. You see the road we've covered over the past 2 years in terms of profitability.

Today, we know if growth is 10%, the increase in overheads will be about 5%, and the rest will accrue directly to EBITDA. So today, we're at offers that have reached the size Ditto for TextileGenesis. TextileGenesis never lost money. It was a start-up when we acquired it, it was EUR 1 million rapid growth, big sling, strong profitability because we've achieved critical mass.

Today, we're very comfortable with the fact that these offers will bring in increasingly. And we're entering this period of consolidation that is, in fact, the second objective that we've set ourselves. It's this objective on SaaS to consolidate and to demonstrate the value.

Now the first objective to make Valia at the high point of the cutting room. Valia is a platform that starts from consumer orders and capable of defining the production plan and notably the cutting plan, all the intermediate stage because there are great many of customers today, 8, 10, sometimes software packages between the order intake and the cutting plan that don't necessarily talk to one.

Valia automates it all, has hundreds of agents taking decisions at every level as the decision-makers in companies. And we enter orders and we obtain an optimized production plan. That production plan can factor in the equipment in place with our customers, be they Lectra or non-Lectra equipment. So we can optimize based on what is utilized.

So for that, we put in place virtual of the fabric, their physical behavior that they shrink with humidity, loads of physical characteristics that I'll spare you that are very important for optimize the garment, how the fabric reacts to when it's worn and then all the processes, the cutting machines that are modeled. We have virtual doubles of the cutting machines. The plan will optimize everything.

And if you say, for example, I want to look at a subcontractor, the best subcontractor have a cutting line with new orders that I'm going to shift to another plant, another country, the plan is readapted real time to say that in that country, these are the parameters that need to be used, this what it changes.

So it's a very powerful tool. The big difference is we were selling equipment and software. But here in production, we're selling equipment connected to a platform, the platform fully monitors the equipment. That is the customer can intervene certain cases, I want to decide, but he can also let the platform operate alone. The platform will fully manage the cutting machine, adapt all the parameters, the change in fabric, type of production, et cetera. So those elements are the 2 strong, we're going to ramp up in these 2 areas. It was a bit long.

So this -- obviously, you've talking a bit about launch metrics. I haven't gone through your release. Could you give us some news on launch metrics in Q1? I recall 9% growth in 2025 not far from your targets. Could you talk to us about the churn, how things are happening? Are you happy, disappointed, surprised?

Well, from memory, we achieved 2% growth Q1. Annualized, that's 8%, lower than the 9%, but it's in line. We're very happy. We're very pleased with Launchmetrics. Firstly, it's the management team of operations that's the strongest across Lectra. We have a very mature team in terms of technology. The transformation of Agentic AI will boost the operations of Launchmetrics stronger than our other decisions. Today, we're both very optimistic and very confident. Same level of churn as a year ago.

On average, we're at 7% churn, the average churn in Q1. We haven't given all the details, but average churn is at 8% in Q1. We had an additional 1% churn. That's due to the situation, but nothing alarming. And for Launchmetrics, we were closer to 5%. It's about the same proportion. We don't want to publish the figures every quarter. Otherwise, people will constantly compare with -- overall, it's normal. If it was abnormal positively or negative, we would say it, but we're in a fully normal situation in Q1. Very often, there's a reaction because in the SaaS proocalypse, people were saying, well, isn't launch metrics under threat.

People -- someone could replicate systems doing the same thing. So we've been following for several dozens of years, at least very intensively for some over 1 million voices, influencers, online media, vogue, printed media, et cetera. We have the full history of all the publications of the -- in hundreds of millions, even billions of data in a database that's proprietary. Somebody want to do the same thing would have to reconstitute that database. Not only would it be hugely expensive, but it's impossible. So we're very protected contrary to what might seem at first sight.

That's -- so today, Launchmetrics is a productivity tool for marketing teams. When you take, for example, all the luxury that are all clients of Launchmetrics with a big budget between EUR 0.5 million and EUR 5 million per year. We're talking big numbers. None has dropped its level of subscription, and we end up with situations where their budgets are very often in the hundreds of millions, at least that we -- thanks to us, they save 20%, 30% in their market budget. It's the tool that brings the best productivity and it's may be counternatural, but it's the case. I'm very confident for the future. As I said, we've got a great team and the advent of Agentic AI will be very favorable for Launchmetrics.

Do we have any further questions from the audience? Any questions at all? Well, if such is not the case, we can move on to the next part of the proceedings, and that is the formalities. We start off with the report of the auditors. So Flora and Jean-Christophe will come up to the lector and read out their report.

Good morning, everyone. Rest assured, we will not read out the entire reports, but we will give you the main findings. My name is Aurelie Lalanne, and I'm associate partner at KPMG. And we have Flora Camp, who is with PwC and Jean-Christophe Pernet, who is with Ernst & Young.

Right. The first report is on the annual accounts of the Lectra SA. So we want to see whether there were any significant anomalies in the financial statements. Our opinion is a certification without qualification. And this year, we do have an observation, which is related to a new accounting rule -- sorry, -- you have to move out. We cannot read the screen from where you -- if you stand in front of it. We do apologize, yes.

So our opinion on the statements is certification without qualification with a technical observation on the change in the accounting rules and methods, which was fully taken on board by Lectra. All in all, on the key items of the audits on both the company's financial statements or the consolidated statements, we -- the audit -- well, the key audit items are listed.

Just the only key item in the report is the recognition of revenues from exported equipment and pilot software at the time of closing. And so we detail the procedures we applied to arrive at these numbers. and we do say that the statements do reflect this accurately.

Regarding specific checks and we conducted these checks to ensure that information provided in the annual report and the governance report, the information is accurate. And there again, there is -- there are no comments on that. And so that's the report on the parent company's financial statement.

If you now look at the consolidated financial statements, likewise, this report proposes to provide reasonable assurance on the absence of material misstatements in the consolidated financial statements.

So this is a certification without qualification and without observation and very much like the report on the parent company's financial statements. We justify our assessments with 3 audit items.

The first thing is the recognition of revenues from exported equipment and pilot software, but we also have 2 other items which were already there in the previous year, measurement of goodwill and evaluation of commitments to purchase minority interest. Regarding specific checks, we have no comments on the information provided in the annual management discussion.

And likewise, we find that there's compliance with the ESEF presentation requirements for the consolidated financial statements. We can look at the full report. We list out -- we detailed the procedures that was used in the audit. And there's, of course, more details in the appendices. Thank you.

All right. Well, on the special report on related party agreements, I'll be brief because, in fact, there are no new related party agreements, neither were there any in the previous year. So there's nothing to mention this, and I'll ask Flora to present the final report on sustainability.

Thank you Well, the report on the certification of sustainability -- of the sustainability information. That was part 2 of the annual report.

Well, we went out to check and assess all the information provided in the previous report. We have a 3-part conclusion, and you have it up there on the screen, shall try and be brief. The first one is on the process of what is known as double materiality. So it is a company to analyze its own risks, opportunities and impact in terms of sustainability, and that is updated on an annual basis. And so for this year, we had the effects of artificial intelligence. And so the entire process was carefully reviewed, and we can confirm that this is consistent with regulations.

The second thing is the company is supposed to provide data on 350 items on sustainability. We went through all this. And again, we can confirm that there is full compliance with the regulation. And indeed, we draw the readers' attention to the methodology and information provided on the carbon footprint, and we find that there's a significant improvement compared with last year.

And then finally, a third item, third theme, which is compliance with the taxonomy, but this has little effect on the company. But again, everything published by the company on this is very much in line with regulations.

Well, thank you. Thank you, and we would like to thank KPMG and Pricewaterhouse because I believe this was your final and the last report here after 25 -- 24 years of laurel services. So many thanks to you both.

Right then, on a personal note, I would like to thank Flora and Aurelie, because they were not always easy to deal with. They challenged us a lot, but they conducted duties very effectively. Whenever there were issues, we were able to address them effectively. So we found this as a very constructive dialogue, and we never had any criticism over the past 24 years. And it's good to say that we were able to spend 24 happy years. But rest assured, there were issues and -- but they were very well addressed with good humor and professionalism.

Right then. Well, this takes us to the final part, and that is the resolutions. We have a few more than last year. I won't get into the detail of everything, but there are 15 to do with the ordinary shareholders' meetings. You have the financial statements, the compensation package for the year 2025, 2026. And then there are 5 resolutions for the extraordinary meeting for which a 2/3 majority is required. And that is mostly to do with operations on the company's capital.

So -- we'll move on to the first part of the votes. We have 2 people from Societe Generale, the bank. And this will be a vote by show of hands. And so we'll go through the resolutions one after the other. But the final results of that vote, having recorded the votes in the audience will be published, of course, in the coming days on our website, if you go to the AGM. And then a replay of this very meeting will be available on the website as well. We -- this is a final position. We cannot take in new voters. The actual quorum is 90.6% of all votes. We have 417 shareholders, those here in the audience and those who have already voted. So we can get started.

Resolution #1 is the approval of the parent company financial statements, and you have the profit was EUR 19,727,446. And the cost excluded from this charges deductible is EUR 132 -- EUR 132,000, sorry. Any votes against, any abstentions? And so enjoy the votes. I mean, we had the votes in the room, but we have more than 99% in favor.

All right. Then Resolution #2, and that is the approval of the consolidated financial statements for the fiscal year ended 31 December 2025. Net income group share stood at 25 -- more than 25 million, almost EUR 26 million. So again, by show of hands, anybody against? Any abstentions? And so that again, in view of the votes received, we have this resolution passed with more than 99% of the votes.

Resolution #3 is the discharge of directors. And so it is for you to vote to give a full discharge to the directors. No votes against, no abstentions. And so again, we -- here, we have only 97% of the votes in favor. This is appropriation of earnings for the fiscal year ended 31 December 2025. The dividend distributable. So we're talking about EUR 0.35 per share, and that will be paid out on the 6th of May. So that again, any votes against that? Any abstentions? And so here, we have, again, upwards of 99% in favor. Well, that was the financial statements.

And now the compensation package, and I will ask the Chair of the Compensation Committee, Celine Abecassis to give us her presentation.

Good morning, everyone. So this is Resolution #5. You may remember that we have to look at the compensation package for directors ex post factors. So for the year 2025. So it is for you to sign on to the compensation, not just the CEO, but for the year 2025 and the CEO and the directors.

And you have all the details in the report on governance on Sections 2.2 and 2.3. You have the full details.

So you can look at this. But having said all that, any votes against, please raise your hands if you disapprove. Any abstentions? All right. I see no raised hands. So many thanks to Celine. We have a vote in favor to the tune of 97%.

And the next resolution is also to do with the compensation for 2025. And here, you have details of the compensation package of Daniel Harari, our CEO. There's a fixed part of the compensation package and a variable part, and that is in line with the last year's policy.

So you have the details fixed variable, the compensation as director and benefits in kind. And so you find that, again, the -- we lined up the variable criteria with those of last year.

All right. Can you vote on that? This is the compensation package for the CEO. Any votes against? And any abstentions? Again, in view of the votes already received, we have this resolution securing more than 97% of those. Thank you.

Now it will be for Helene to come on stage. And so Helene Poirier has been a director for 4 years. She was very much involved in the work of the Strategy Committee, the Audit Committee and of course, the Sustainability Committee, which she chairs. In terms of sustainability, I think we've made giant steps over the past 4 years. And so the Board unanimously recommended that her term should be renewed for 4 years. You can -- now people know who you are.

Right. Well, we know the renewal of Helene's term is up for vote. Any votes against any abstentions? I see none. And again, adding to the votes already received, we have more than 98% of votes in favor.

And now new faces on the Board, and we have -- I'll ask Daniel.

Where we have Christophe Gegout who will ask him to kindly come on stage. And Christophe -- if you vote in favor, he will be an independent director on the Board. And the process, the selection process for independent directors is spelled out in the report. We have a management committee, which provides a short list of possible candidates. Then there are interviews. We get views from directors, and that's how we decided to appoint Christophe as a director.

Yes. Well, thank you. And now it is for me to turn to shareholders. I acted as an Independent Director for a listed company of the SBM 320. Before that, I was a Director of NOM, which is a company involved in Renewables and Soitec, which is a company involved in microelectronics. I also have executive positions of the CEA, Commissariat a l'energie atomique and it has, of course, a technology lab where similar issues are discussed.

I spent my professional life in sitting on Boards and also working as an adviser to investors abroad. Well, if the -- well, thank you for -- well, in France, maybe you can explain what the CEA means. Well, this is -- yes, it's the second largest research organization right after Feinhofer in Germany. And it stands for Commissariat a l'energie atomique, Atomic Energy Commission that was created by General de Gu. The initial idea was to develop nuclear energy in France, but many other areas of research, basic research, biology, all sorts. And this, of course, has many connections to manufacturing industry in France, but we also have partners outside France. Thank you.

All right. So we need to vote and see whether Christophe Gegout will be indeed accepted as director. Any votes against, any abstentions? I see none. And so if you add this to the votes already received, we have upwards of 99% in favor of Christophe Gegout joining the Board as a Director.

A newcomer also joining the Board very soon. Here, we're currently announcing the arrival of Fiorangelo Salvatorelli. Fiorangelo, who is a member of the Alantra fund, been following Lectra for 3 years, Alantra being the #1 investor at Lectra, #1 investor above my holding very -- thank you, Daniel.

Ladies and gentlemen, my name is Fiorangelo Salvatorelli. I'm an engineer and an experience at Oxford University at INSEAD, professional experience that started at McKinsey and company, London, Milan and Madrid and many years of investment in technology. Today, I represent Alantra, a shareholder of Lectra. We believe that Lectra is one of the best companies in France for digital transformation and contributing to the growth of AI and transformation to Industry 4.0. We believe that the photograph that the possibility of Lectra the reorganization of production, we're very pleased to take part in the growth of the company.

Thank you, Fiorangelo. Let me say that Fiorangelo is appointed in his personal capacity. It's not Alantra that will be represented, but Fiorangelo. Thank you.

So we're now going to vote. Who is voting against this appointment of Fiorangelo? Who abstains? Thank you. So given the votes that we've already booked, the resolutions adopted with over 99% well done, and welcome.

I'm going to invite Celine to join us once again for continued remuneration.

This is ex-ante. We're now going to look at the compensation for 26 ex-ante, the total package for directors' comp we suggest to increase from EUR 480,000 to EUR 570,000 justified by 3 factors: the number of directors that's increasing the number of meetings, 2 reasons and committees and committees. That's right. Number of directors, number of meetings and number of committees.

Thank you, Celine. So we're going to vote. Please raise your hand, those who vote against and those who are abstaining. Thank you. So given the votes that we've previously resolutions adopted with over 99%.

Moving to Resolution 11. So continuing with the question of ex-ante compensation, we're now going to review the compensation of Mr. Daniel Harari, Chairman and CEO for FY '26. principles remained unchanged since 2017. Total compensation of EUR 840,000 based on objective, 50% fixed, 50% variable compensation.

And on the following slide, we have more information. So for the variable part, variable, we've simplified the equation. As you can see on screen, we have 3 main metrics: 2 strategic, 1 sustainability for strategy, SaaS ARR growth aligned with the road map, EBITDA before recurring items and sustainability criteria, 3 indicators, nonfinancial ratings, team engagement rate and the climate transition plan, you can see on screen, the weighting of 40%, 40%, 20% respectively, a few changes over last year, particularly the SaaS ARR dimension.

Thank you, Celine. So we're now going to vote on this compensation 2026 of Daniel Harari. Please raise your hand if you vote against. Or if you abstain. Thank you. Given votes previously received, resolutions adopted with about 98% of the vote. Thank you.

We now move to -- and thank you for your trust and confidence at Daniel. I'll try and have a variable this time. I haven't really succeeded as you've seen this year. That's one everyone expects of us. So I'll try and ensure that the variable is achieved.

Final resolution on compensation, compensation of the directors. Ex-ante for 2026, as we said earlier, total package was approved to be increased to EUR 570,000. The cap on individual compensation is maintained. And shown here are the details, fixed and variable components for each position and the detail for each of the committees with very little change over last year.

So we're now going to vote on this resolution. Please raise your hand if you vote against or if you abstain.

Thank you. So given previously booked votes, resolutions adopted over 99%. Thank you. So perhaps just a comment, which is that given the importance assumed by AI as of the Board meeting after this meeting, we're going to set up an AI committee chaired by Karine Calvet in the room, if you'd like to stand up and look at the camera, and we're going to make sure that we use everything that is available to us since this profound transformation affecting the whole world to be ahead of most of the companies and best practice in terms of AI.

Thank you. And Resolution #13, I'm going to hand over for appointment of Grant Thornton as statutory auditor.

So we have our 2 historic auditors come to the limit of 24 years. They can't be extended. Last year, we decided to appoint a first auditor who introduced himself earlier. We also plan to appoint a second auditor already selected last year, but taking up his duties today because the year 2025, we wanted to have a link between the outgoing and incoming auditors. And this year, Grant Thornton will intervene as second statutory auditor next EY. I'll let you introduce yourself.

Good morning Charlotte Espinet I'm partner within Grant Thornton. Briefly, Grant Thornton, we're an audit and consultant group multidiscipline based in France with just under 3,000 employees, but across 150 countries, and we support a great many groups listed or not, including many in an international setting. So we're delighted to start this mandate of co-statutory auditors with the Lectra teams and with EY that joined the Board of Auditors last year for this seamless transition.

Thank you, Charlotte. So we also note that we're kind of staggering the terms of office, 6-year terms, one that started in '25, second term with Grant Thornton that's beginning in '26, and we're going to vote now. Thank you. Please raise your hand if you vote against the appointment of Grant Thornton. And those who abstain. Given the previously received votes, it's always incredible. I don't know why auditors always have record scores. So this time, a bit like last year with the resolution approved with over 99.99%. So your level pegging with EY's result last year. Thank you.

So moving to Resolution 14. And here, we have to appoint our auditors in charge of certifying sustainability information. And we're appointing -- we propose the appointment of EY as statutory auditors responsible for certifying sustainability information. Jean-Christophe, would you like to say a word? No.

So there are going to be a staggered term of office because sustainability mandate starts in '26 6-year term of vote. And so thank you. Please raise your hand if you vote against the appointment of EY on sustainability. And those who abstain? Given previously received vote resolutions approved with over 99% of the vote, well done.

We now final resolution on the ordinary shareholders' meeting, authorization to be granted to the Board to trade in the company's shares at delegation of authority given by the meeting to the Board to authorize the Board to implement a share buyback scheme for 18 months with a limit of 10% of the capital. It's a traditional resolution means the company can have the necessary flexibility to manage its own shares in the interest of the company and that of its shareholders authorization, of course, to buy its own treasury stock authorized by in-force regulation.

And in particular, the list can be very long for the market, improving the liquidity of the share. Share option plans, the use of shares for M&A and if need be, the cancellation of shares in the authorized limit. The list isn't exhausted, but we've cited the main operation, maximum purchase price, EUR 40 per share for a maximum amount of EUR 50 million.

Yes, just some A few points about that. So the Board or the meeting delegates to the Board, which will subsequently delegate the authorization to operate. And based on in-force regulation, we'll select a bank that will act fully, and we give it a mandate with intervention, but the company isn't actually involved in managing those intervention.

We'll put out a press release as soon as we implement those -- this share buyback plan because, of course, we want to let the share price stabilize after yesterday's announcements before using the share buyback so that the share price returns to a balanced situation irrespective intervention.

Our plan is to intervene in some 10 days, intervene systematically in buying shares under conditions that will be set out more specifically in our release.

Thank you, Daniel. So we're now going to vote on this resolution. Please raise your hand if you vote against this authorization granted to the Board to trade in the company's shares. Thank you. Abstentions? So given the votes previously received, resolutions adopted over 99% of the vote.

Just a clarification here says Daniel, the mandate that we'll give to the bank to interview is 100% consistent with the French Securities Exchange mat, and we'll notify it to the AMF before it comes into force, even if it's not mandatory, it's a good practice. We're fully in line with market practice.

And just to add a word, transparency occurs every month or so because we'll put out a release on operations that occur as part of the share buyback plan release every month available on our website, give the AMF and report very transparently to everyone.

Perhaps just the underlying philosophy here. I think it's an important point, probably the most important resolution of the shareholders' meeting. Our intention isn't to support the share price. People think that when we buy shares that it's the share price, maximum 25% of daily trading on the market, the Euronext market. We have about 1/4 of transactions that go by the market, 3/4 of block trading.

With this, we can have a block trade, but we don't -- we can't afford to buy everything. It's not going to change the market. It won't change the balance significantly. And of course, it protects us very small trading volume one day. It's really something tactical short term that we are already doing with the liquidity contract.

The most important point is that the Board in fact, having discussed and listened to its major shareholders considers that at the current share price, the company is very much unlisted, and it's a good opportunity to -- that would be accretive for remaining shareholders and have more earnings per share. So it's really a way of affirming our position on the fact that we believe in the mid, long term of the company and a valuation that today does not reflect its true value.

So, Nathalie, who's Lead Director with a microphone, please and turn to the camera.

Yes, just to say that this is a possibility that we have today. It's an option that we'll have. We haven't yet determined the period of intervention. If I could just add that, nothing has been determined at this stage, and this will be done very soon.

So it's leeway given to the Board, not an obligation, of course, but we want to demonstrate that the Board believes in -- strongly in the value of the company.

Thank you very much. So we're now going to vote to -- we haven't voted. We have. We have. We voted followed by comments. We can revote, if you like.

So moving to resolutions of the extraordinary meeting, majority -- 2/3 majority for the resolution to be adopted, 16th resolution. So you're asked to authorize the Board to grant stock option or stock purchase plan benefiting certain employees or corporate office, total number of shares limited to 2,100,000 shares throughout the duration of resolution for a period of 38 months that represent a maximum amount 6% of the capital of the share capital and per year, 2% of the share capital, the capital increase. If all these options are allocated and exercise as they're based on performance, that can be lost. We want them to be all allocated. That would good time to come, there'd be a capital increase of EUR 2 million at par value, EUR 2.1 million.

So conditions vesting with presence, minimum lockup period of 3 years before exercising the vesting right and the exercise price without a discount set by the Board in accordance with applicable legal provisions, duration of the authorization set at 38 months. And if you're agreeable, if you have nothing to add, Daniel, let's vote on it. Please raise your hand if you vote against. And if you wish to abstain, well, that thank you. Given the votes previously received and those in the room, resolutions adopted over 92% of the votes.

So on a resolution on stock options, probably the highest vote percentage that we've ever had. My thanks to those who vote in favor. It's very important for the team and to galvanize everyone.

So on the 17th resolution, there's a little box there that appears. We're going to also explain to you why we recommend that you vote against the delegation given to the Board to carry out a share capital increase reserve for employees. So you have the characteristics shown on screen and a cap of EUR 100,000.

Your Board recommends voting against this resolution. It's presented really to meet a legal requirement. Well, basically, we open a stock option plan. That was the previous resolution adopted. So legally, we must also authorize or grant authority to the Board to carry out share capital increase for employees. So why does the Board refuse or at least recommends voting against is that we're no longer in a Lectra remuneration policy based on performance-based conditions, not at all in a value creation approach with this type of -- we vote -- we recommend that you vote against this resolution.

We're going to have a rather different vote. That's to say those who want to follow the Board's recommendation, I would ask you not to raise your hand. And then I'll ask you to raise your hand those who want to vote in favor of the resolution. And so no abstentions either. So -- right. And so in view of the votes, so this resolution is rejected. Only 24% of the votes in favor.

All right. We move on to Resolution 18. And this -- it is to authorize the Board of Directors to reduce the share capital by canceling shares as part of the share buyback program. So this could happen within 10% of the full capital stock. The authorization is for 24 months. Who is against that? And who is -- who abstains? So many things. So in view of the votes already registered, this resolution is carried with 99% of votes.

And then #19, this is a technical resolution to adjust the articles or the bylaws to new updated regulations. So this is basically ensuring that we -- by the legal provisions relating to the record date. So this is just a matter of being to comply with new regulations. So if there's anybody against, please vote now. Any abstentions? Many thanks. And so in view of the votes already received, of course, that resolution has carried with more than 99% of the vote.

And finally, it's a power resolution powers to carry legal formalities there again. This is just a vote to enable us to do what you asked us to do. And so please raise your hands if there are any votes against or any abstentions? Well, many thanks again, that last resolution has -- was able to carry more than 99% of the vote.

We -- this completes the votes, but this is now a timetable of the next events. So we will -- in a year's time, we'll come together on 29 April at the shareholders' meeting, and that will not be here. But in our new premises.

Yes, we are, as you know, revamping the ground floor right now at Lectra. So that's why we're meeting here instead. But as of next year, we will be back in our own building to welcome you.

All right. Many thanks to all of you, and many thanks for your patience. There were as many as 20 resolutions. We would like to congratulate all the new appointees. And does Daniel wish to say anything?

Well, yes, I'd like to thank all the shareholders that have come here. I would like to thank them for voting because, of course, when you have a high percentage of positive vote, well, that speaks for itself. I mean we always have very high rates in favor. And so these are challenging times and 2025 was already challenging. So having your support is really essential for us. So many thanks for your presence, for your trust. And let's hope and pray that next year, we have better figures to show for.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Good morning to you all. Welcome. This meeting will be broadcast online, translated simultaneously into English, and we'll take questions from the room and those who have connected remotely. Welcome to those of you in attendance. We're going to cover a number of topics today. We're going to review evolution of our markets, cover the results of Q4 2025, an update on our balance sheet and free cash flow, tell you about Lectra today, things have changed in great detail. And when you follow us, sometimes we have a past look of Lectra our strategic road map for '26 through '28 and our financial objectives 2026, 2028.

So 3 key highlights, macro geopolitical situation, extremely uncertain with news flow created a lot of damage worldwide because one thing that is said on Monday can be contradicted on Tuesday, prompting many reactions, a big wait-and-see attitude. People want to better understand what's happening, which has a negative impact. Secondly, when we look at our results, of course, we're not happy with the result. We'd, of course, prefer to have better results, but we are nevertheless proud. When we look at how Lectra has resisted in this environment, I'm sure you'll agree to say that these results demonstrate the very strong resilience of Lectra.

We've also demonstrated our ability to continue to generate strong free cash flow, so we can view the future with confidence, more about that later, and it offers great potential for the future, whatever our plan.

Our markets now. The first thing on the fashion market is a rebalancing in terms of subcontracting and production, a very sharp fall in China, an increase in a number of Asian countries, notably Vietnam, pretty much on a par of exports to the U.S. is China today. The big winner of this period and as we see a number of other countries, India, Bangladesh making inroads, a big shift of the market of clothing manufacturing in Asia with a rather strange situation because at the end of this period, only country whose tariffs haven't increased is China with all the discussions that were held. We've come back to the starting point pre-April 2, whereas tariffs have increased up to 30% all the countries up to a few days ago. India, very difficult situation, 60% tariffs brought down to 18% last year and Bangladesh, there's a portion of Bangladesh production to the U.S., which will be free of tariffs, and that was announced a few days ago.

We're waiting for the details. We sent an easing in terms of bilateral talks between the U.S. and these countries, but the landscape is shifting. There will be winner and losers and this is shown clearly, we see the drop in China, no change in the tariffs. It's very surprising.

When we look at automotive, I should have said, in fact, same situation in fashion. We see after a lot of turmoil, a lot of debate, we're at a level of production and sales on a par with last year, and it's also expected constant next year. So more fear than bad results. Tariffs, 15%. That's 5% higher than previously. [indiscernible] 0%, 5%, 15%, 25%. It's 0 in Mexico's production in our business exported to the U.S. The free trade agreement is being upheld. And the big change in automotive is the massive arrival of Chinese e-vehicles, a fierce price war in China. The Chinese government announced that it wanted to consolidate the market, 120 EV brands in China, government expects that in 3, 5 years' time, that should shrink to 20%. BYD, the #1, has cut its prices 30% to try and force all other car manufacturers to sell off or disappear. So all margins are being squeezed in China, at the same time, they want to export to the rest of Asia and Europe because their markets are now outside China.

Moving to furniture. Here again, the market remained broadly stable. Great many question marks because tariffs into the U.S. were strengthened. Transportation cost for furniture is complicated. Generally, we manufacture close to where we sell. The situation is now stable in terms of normal tariffs. And the situation is furniture market that remains sluggish, challenging. People tend to change their furniture when they move. There are fewer house moves so less demand. But at the end of the day, we arrive normally at a demand equivalent in '25 and '24, expected equivalent in '26 in spite of the turmoil markets in terms of production and sales remain very stable.

I'm going to hand over to Olivier du Chesnay for the financials.

Thank you, Daniel. Good morning to you also. I'll begin by presenting the key highlights for 2025 and activity and then balance and free cash flow. On the right, you see that when we have the presentation of the amounts for 2024, we use the '24 exchange rate. And for the results of '24, we'll use the '25 rate.

When we look at the comparison between the 2, we'll take into account each. The increase can be a variance, but we have to note that the dollar is down versus the euro. All the data on '24 are pro forma data. We added 23 days of launch metrics. So I'll begin by activity on recurring and then nonrecurring and then the P&L.

First point is the information published since on the ARR, which is the basis of all our contracts in annual value for subscription. ARR is up 14% on the year 2025, constant exchange rate, 88.9 at the start of the year to 101 when we use the start of the year ForEx. We saw an increase in the final quarter when we look at the numbers when they were reported end of September. The run rate was close to 12%. We ended the year at 14%. So all our offers, be it the new acquisitions of launch metrics, [indiscernible] contributed to that increase, but we also have Valia or Cubic took part and have a growth rate higher than the 14%.

When we report our numbers, ARR based on the balance sheet December 31, that's why the is at 97.2, not because we use the balance sheet rate, which is 117.

If we stay on recurring revenues in the middle, you have total recurring revenues. Total recurring revenues 2025 accounts for 75% of revenue. This recurring revenue is up 2% and split into 2 parts. On the left, you have the recurring revenue, the recurring contracts. And on the right, you have the consumable and parts. Take the last bar on the left-hand chart. That's the total amount of activity of revenue of contracts, EUR 242.3 million. Within those recurring contracts, you have 5% growth, 5% growth already at the end of September. It was 5% in Q4. Within those recurring contracts, you have 3 types of revenues. The purple, the software SaaS subscriptions for EUR 89 million. That's revenue, which is the transcription of the ARR mentioned previously into revenue with an increase of 14%. Next, you have 2 types of maintenance contracts. Software maintenance contracts that represent EUR 51.1 million that are slightly down. That's pretty logical because now all our software offers, the new ones are SaaS and, then you have maintenance contracts on maintenance -- annual maintenance contract with [indiscernible] renewal. They're up 2% on normative growth is 5%, 6% on maintenance contract. There we have pressure on activity, but we're still up on those equipment maintenance contracts.

On the right, you have the second part of recurring revenue, which is the activity of consumable parts. Consumable parts is more subject to our clients' activity, the number of hours that machines are running. We've not seen any positive inflection in Q4 on the activity of consumable parts. We remained at 4% full year. The activity represents 137.7% at 2025 exchange rates in '25.

Moving now to nonrecurring. Nonrecurring, we start with the new system orders, the orders of software perpetual equipment and consultants. For 3 quarters, we were pretty much on the same level in value of order intake, about EUR 25 million in Q2, Q3 and Q4. When we compare it to Q4 '24, Q4 '24 was pre-announcement on tariffs. Q1 was also previous to the tariff. And we have a basis of comparison that's higher. 27% drop on the quarter in spite of stability of order intake quarter-on-quarter. Full year was 17% drop in orders. This decrease by geography varies from one quarter to the other.

First thing to look at is top right, Asia Pacific. On Asia Pacific, that's where we have the highest decrease in Q4, primarily in China and automotive. So full year, we have a decrease of 26% in Asia Pacific. Asia Pacific, we had Q3 -- Q4 growth in '24, continued to grow into Q1 and it stopped after the tariff announcements. On the other regions, Europe is holding up better, minus 4% in Q1, minus 6% full year. More favorable basis in the U.S., flat in Q4, no rebound yet in America, but stable in Q4. On bottom right, you have the other countries of the world. That's Turkey, Egypt, Morocco. We have 2 different dynamics. Turkey sharply down and Morocco, Egypt are growing. You see that with these results in SPAC. SPAC last year accounted 43% of orders. This year only accounts for 38% of order intake.

Still looking at new systems orders by sectoral markets, same items by sectoral market, what you see. The second graph is automotive is sharply down in Q4, minus 52% here again, essentially Asia, minus 30% on the first 12 months of the year. Fashion in the same trend between Q4 and the rest of the year. We lose 1/3 for furniture and other industries essentially that have a somewhat different CapEx cycle. Composite materials in '25, we have 13.8 of order intake. That's double what we had in furniture in '25.

Activities, orders, you find these orders on the left on the -- of EUR 119 million, down 17% versus start of the year. And those 17% orders, you have natures that have different cycles. The top, the EUR 7.9 million are the orders, software perpetual licenses. The software perpetual license are decreasing by 1/3 every year. Why? Because we sell all our new software offers in SaaS mode. And then you have a low training and consulting. Over half training and consulting comes from projects that are triggered by SaaS subscription sales as it's following the dynamic of SaaS sales and part of the equipment sales, but equipment sales are down 19%.

EUR 119 million of orders will generate over time, nonrecurring revenue, EUR 119 million of orders generated EUR 126.6 million of nonrecurring revenue. Since we have more revenue than orders, it means that we had to delve into the backlog at the start of the year. We end with a backlog that's lower, and we're decreasing nonrecurring revenue of 12%.

If we summarize, across the P&L on recurring revenue, we're up 2%. Recurring revenue accounts for 75% of revenue. For nonrecurring revenues, minus 12%, the sum of those 2 numbers, minus 2% revenue, landing at EUR 506.7 million.

Next, you have the gross margin. Gross margin in '24, 71.7%, 72.9% in '25. So we managed to up our gross margin. There's a positive mix effect with more recurring with a higher margin. There's also an unfavorable ForEx effect when the dollar slides, it squeezes the margin. So we have a dollar rate that's unfavorable in 2025. But line by line, we grew all our margins across the various product lines in spite of pressure on revenues, we're resisting in terms of gross margin generation.

On the right, you have cost control. In the cost, we have fixed and variable costs, the sum of the 2 is slightly up by 2%. Let me remind you, 70% of cost are payroll costs. We increased salaries in '25 2.5% to 3%. We managed to offset part of that inflation through departures and cost savings.

Moving down through the P&L. EBITDA goes from EUR 91.4 million last year to EUR 79.7 million this year with an EBITDA margin of 15.7%, income from EUR 48.8 million to EUR 38.2 million, net income at EUR 25.6 million. On net income, we have 2 items to note. Between operating income and net income, we had 2 one-offs. The first relating to New York. We depreciated the rent on future years because of the ideal and a positive tax rate, it's positive. We activated the deferred tax assets of LaunchMetrics, losing money before we acquired them. So we have DTAs that we were able to activate in 2025.

If we summarize the P&L., I said starting from EBITDA that was reported in '24, a slight pro forma effect, pro forma 91.1% to 79.7%, 84.4%. We see the strength of the recurring model. The green bar of EUR 11.3 million is the EBITDA contribution of recurring revenue, recurring contract. Generally, the bar next door. Consumables and parts generates a profit here. It's down 4% consumables and parts. We don't have that upside this year. And the green portion offsets in part the decrease in nonrecurring revenues and the growth in fixed costs.

When we go from EUR 91.4 million to EUR 79.7 million, that's about EUR 12 million in decrease, EUR 7 million decrease activity and EUR [ 6 ] million that's linked to unfavorable exchange rate. The dollar went to EUR 1.08 last year to EUR 1.13 on average this year. If I end on the P&L, I just mentioned the exchange rate in '26, '28. We're not making any assumptions on where the dollar is going to land. We just take the dollar at the 1st of January 2026. The dollar 1st January '26 is at EUR 1.17. The average for the year was EUR 1.30. When I take up the P&L of '25, convert it every quarter to EUR 1.17, reported revenue of EUR 506.7 becomes EUR 497 million and EBITDA goes from EUR 77 million to EUR 75.2 million. The EBITDA margin to 15.7% to 15.1%, [ 65.2 ] is the starting point for the '26-'28 road map at [ EUR 1.17 ] parity and below regarding equipment orders in '25, we had a higher basis effect in Q1 and Q2, that will be on nonrecurring revenue.

Moving to the balance sheet and cash flow. Our balance sheet remains really strong. We've got limited debt, EUR 100 million at the time of the LaunchMetrics acquisition, and we're paying back about EUR 50 million plus interest every year. So the debt is going from EUR 102 million to EUR 86 million. Strong cash flow generation, EUR 57 million. This means our net financial debt is only EUR 21.3 million, and we have EUR 65 million in cash.

After buying more minority interest for LaunchMetrics for EUR 20 million and also the remaining minority interest for Planco, the Turkish distributor, and also [indiscernible] activity, we also paid out EUR 50 million in dividends, and therefore, repaid part of our debt. If we look at one of the group's fundamentals, our free cash flow generation remains strong. This year, we generated EUR 57 million in free cash flow before nonrecurring items, EUR 72 million last year, that was a record. EUR 57 million with a declining income and difficult macroeconomic conditions, also generating a drop in working capital requirement, which stands at minus EUR 37.7 million this year, which is typical of our business model. It's also a record in terms of managing our working capital requirement in 2025.

When it comes to our share price, we're still under pressure, have been under pressure since the beginning of the year. At the beginning of this week, the share price stood at EUR 23.1 with EBITDA multiples of EUR 1.7. From now, the share price remains stable.

And now I'm going to hand over to Daniel to discuss Lectra.

First of all, in 2017, we announced a new strategy for Lectra. The goal was to turn Lectra into a major player for Industry 4.0. Back in the day, everybody wondered what that was all about. We have described this at great length. So I'm not going to belabor the point. Throughout our system, throughout our software packages and all our equipment, we have developed 4 major technologies to support this transition into Industry 4.0: artificial intelligence, big data, IoT in particular, and cloud technology. So we are very comfortable regarding all of those AI-driven technologies. And those technologies have supported the ways in which we have implemented this plan.

We accelerated in October. As we saw in October, we fast tracked our efforts over the past 3 years, and these efforts will continue throughout 2026. This strategy is based on 5 different pillars. First of all, a premium offer, a premium positioning. We want to have the most premium position in the market every single time. And also, our strategy is designed for all 3 strategic matters: automotive, furniture and fashion, even though there are products that we develop so that they can be used in other industries as well. So these are our 3 primary market segments. Also, customer centricity. More and more customers are at the heart of what we do. And our ties with customers have grown closer in recent years, and this explains our results today. We have close ties to customers that are in dire straits. And this means we are a preferred partner when customers decide to make investments. So we'll see when the recovery takes place. But having such close ties to customers is a good idea.

Also developing new 4.0 services. It's a mixture of artificial intelligence, expertise and data. In other words, we are able to monitor what customers are doing and then provide the analytics and the expertise that customers may be lacking, and this provides significant value added. And lastly, we have a very strong and committed sustainability policy. In the latest sustainability rankings by independent third parties, we are always in the top 5%.

Now there are 2 aspects that are going to radically change our environment in the next 3 years. First of all, artificial intelligence. And there are ups and downs. There's positive and negative perception of AI. Maybe our vision of AI is much more pragmatic than that of others because we use it. And we know that it works for us in many regards, and there are things that don't work as well. So we are deploying AI internally for a number of functions. So artificial intelligence is pretty much everywhere in all of our products. Also, we're navigating in a world fraught with increasing uncertainty, therefore, we need a plan that can be adjusted on an ongoing basis. We need to work on the basis of scenarios as opposed to having a deterministic vision of the future. The future is not set in stone. You need to be really, really powerful in order to predict the future.

So thinking on the basis of scenarios makes us really strong. There are 3 market segments that are in the midst of vast, fast-changing trends. Markets are shifting in Asia, in particular. A lot of companies, luxury companies, in particular, are shifting their positioning. And this trend is going to continue. In automotive, we're seeing the rise of Chinese-made electric vehicles, which are a major threat to the European industry, and particularly the U.S. industry in the future. Right now, the barriers to entry for Chinese vehicles onto the American market are still very high. It's not just about subsidies -- Chinese subsidies to the Chinese vehicle industry because it takes 3 months for the Chinese to design a new EV, but 3 years in Europe. So the barriers to entry in terms of R&D are pretty strong as well.

Also furniture, everybody is expecting recovery in real estate and the recovery in furniture should follow the same trend. So that's a market that we are keeping a close eye on.

Now let's drill down on Valia. Valia is our new software platform. We've been marketing that since the beginning of 2025. We already started using it in automotive and furniture, and now we launched it in fashion. It's a very sophisticated platform. We start with customer orders. And it takes us all the way to the cutting room production facilities and also execution of the various production orders. It took 10 years of R&D efforts to develop Valia, and we rolled it out gradually market segment by market segment. And now we have a full system. It's an open platform that it's compatible with any ERP, any CAD system, in any manufacturing system, any customer system. So it's compatible with Lectra and non-Lectra systems. So Valia is a demonstration of what we're doing for Industry 4.0.

We address a lot of functions that are currently managed by independent software packages. And this means that in terms of the customers' value chain, they're having a hard time ensuring compatibility between those different systems. So we have an agentic AI approach. We have an expert model for each step of the process and the platform will behave as an expert for that decision-making process. So Valia is a true revolution. It is unmatched on the market. We believe in it 200%. Valia is how we spearhead our strategy on the manufacturing front.

Now we have an extensive offering when it comes to the fashion industry based on 5 different pillars. First of all, design, creation. That's our core business. Our first products were CAD products and then manufacturing. We bring together Valia and equipment. And Max can talk to you about that successful combination. And then markets, which is mostly driven by launch metrics, [indiscernible] and rent reviews and also Kubix Link drives our collaboration business, but it does much more than just a product life cycle management system. So we've gained a lot of traction in recent years. And finally, we have a traceability platform with TextileGenesis.

If we look at the shift, what is it that makes us strong today compared with the beginning of our strategy? We have operations in 100 countries or so. We have a strong customer base, which has been strengthened by the Gerber acquisition. We doubled our customer base with the Gerber acquisition. So the potential for selling our solutions to all those customers is significant. And we support our customers, and this drives customer success. We have 800 people dedicated to customer success, and we have state-of-the-art technology in every area. Our offer is unique. Very often, it is unmatched on the markets. And lastly, we have a very strong presence in terms of sustainability and compliance because we support our customers on their quest for sustainability, and this includes ethics, material savings and traceability.

There are 2 main figures that reflect our policy. Since implementation of our strategy in 2017, our ARR has jumped to over -- to close to EUR 100 million. So these figures demonstrate the success of our strategy over the years. And also, we've positioned ourselves well to address the next 3 years.

Now I'm going to hand over to Maximilien. He will tell you a little bit more about our strategic road map.

Thank you, Daniel. Good morning, everyone. Pleasure to see you all again this morning. I look forward to introducing to you our strategic road map for 2026, 2028. Now for those of you attending remotely, you may not have noticed, but I have pinkeye like our dear president, but I'm not going to wear aviator shades, the contrary to you, Mr. [indiscernible]. Lectra has scaled up significantly over the past 3 years. Over the past 10 years, it's consolidated its business plan, its economic model. It has strengthened its new positioning, its new leadership. It's been enriching its offer significantly over the past 10 years. Lectra has supported key customers throughout their transformation process, and it's now seen as a responsible, sustainable player, which are huge fundamentals for the next 3 years.

And our fundamentals, our financials are extremely strong. recurring revenue, in particular, 2025, EUR 380 million in recurring revenue. 2016, prior to the launch of the Lectra 4.0 strategy, our total revenue was EUR 260 million. Now EUR 380 million in recurring revenue versus EUR 260 million back then. So a major gain if we look at the next 3 years. So on the basis of all our strengths, we are confident in our ability to handle '26. But we will remain humble. We will continue to implement our strategy methodically, stringently. We will continue to rely on the fundamentals of Industry 4.0.

As Daniel recalled, as early as 2017, we stated that cloud technology, Internet of Things, big data and AI would support that new industrial revolution, Industry 4.0. Now those technologies, well, we've been handling them well for decades. We've been using AI since the 1990s, not just for software, but for equipment as well since the year 2000. In terms of Internet of objects, IoT, we've been doing that since 2007. We've had smart equipment then. Remember, back in the day in 2007, the term IoT did not exist. So we know what it's like to toy with data. We know what it's like to use cloud technology. And we know the potential of those technologies. We have to fully materialize it because things shift all the time, but things are well under control. And those technologies have been factored into all our new offers.

Industry 4.0 is more than just a vision. It is a reality that is fully coming into its own. So over the next 3 years, we're going to take things up a notch. We're going to go even further. We're going to maximize customer value as we maximize the contribution of all our solutions. We have a portfolio of solutions that are designed to support customers through their transition into Industry 4.0. So 4 different -- rather 3 different priorities. First of all, position Valia at the forefront of the manufacturing offer. Secondly, we want to scale up the Software-as-a-Service business. And third, we want to ratchet things up, and we want to boost operational excellence to accelerate growth. Over the next few minutes, I will review all 3 priorities. Let me start with priority #1.

This revolution in production will be driven and scaled up by Valia. It's taken 10 years of R&D to develop Valia. It's more than just a slide or a theory or a concept, it is a reality. Over the past few months, we have raked in 70 customers who now use this revolutionary solution, and we launched it in a number of geographic areas, huge potential with Valia. The manufacturing offer as far as Lectra is concerned, combines equipment, software, Valia now spearheads that, and also related services as symbolized by maintenance contracts and CPs, consumables and pieces. And this is how we generate value for our customers by combining all those offers.

So to sell Valia, we're going to rely on our installed base. On this slide, as you can see, on customer premises, we already have 9,000-plus Lectra-connected IoT equipment in operation. This equipment is natively connected to Valia. And we've been marketing them since 2007. It's a huge -- this means huge potential for upselling because if the equipment is connected with Valia already, we are providing much higher value for customers. And also, there's huge potential when it comes to replacing the older generation equipment, 5,000 such equipments. So older Lectra equipment that we sold at the end of the '90s in the beginning of the year 2000, which are not compatible with Industry 4.0 fundamentals, that are not IoT capable and that have to be replaced by the next generation of equipment that we are marketing. And so this means huge efficiency and productivity gains, unmatched material savings as well.

And as we announced a couple of months ago, Valia is now compatible with any industrial equipment, whether Lectra equipment or third-party equipment. As you can well imagine, the value that we provide when Valia is combined with the latest Lectra equipment, that value is much bigger than if Valia is combined with older generation equipment or third-party equipment. And this means a virtuous cycle. We're using our installed equipment base to sell Valia, digitize production flows for our customers, to have a single flow that connects with all equipment and Valia can help us demonstrate the difference between the latest Lectra generations and other providers. So it's a virtuous cycle that will strengthen our economic model.

So like I said, it's taking 10 years of R&D to develop Valia. And the predecessors include the digital cutting platform, quick flex offer. 700 customers already adopted those predecessors of Valia. Now it makes sense to naturally migrate towards Valia. But well before 2017, we had software solutions for production and preproduction purposes that customers were using. We have 5,000 customers who are using those software packages under contract. So they are active customers, and those solutions will be replaced by Valia. So there's huge potential, both in terms of equipment with Valia software and also related services such as maintenance contracts and CPs.

Now getting back to maintenance contracts. We talked about that right here last October, Empower. Empower is the next generation of maintenance contracts. Those maintenance contracts are absolutely unique on the market. It's underrepresented globally. It's a contract that guarantees availability of Lectra equipment. In other words, our maintenance contracts meant an obligation to repair the equipment. Now we ensure results, and we do whatever it takes to make sure the outcomes are achieved. This is unique. And we capitalized on 15 years of IoT expertise. We're capitalizing on our model where we support our customers remotely. We're able to troubleshoot malfunctions remotely in 90% of cases. We -- out of 10 calls for help, we send out a technician only once. And our customers serve as our best ambassadors when it comes to our manufacturing offer for all 3 strategic sectors: automotive, apparel and furniture.

This slide shows a number of verbatims from our customers. This is how they use our offers. Now the common denominator between all 4 verbatims is that our customers understand the value provided by our solutions: related services, equipment and software. The value this means to perform better, transform their services, gain -- generate competitiveness and productivity gains.

MAS is a leading player, but we're also working with Tesca in automotive. They are a European leader when it comes to automotive. And also in the furniture segment, we have 2 examples here, including Gamma. So here's a video from HCOM, an American company, one of our customers, and it reflects exactly what we've been doing over the past 10 years, both in terms of transforming our model, unlocking synergies, thanks to the synergies, thanks to the acquisitions that we've made, including Gerber. So HCOM is a long-standing customer of Gerber. They used to use Gerber software and equipment. And 2 years ago, they knocked on our door and said, "I want to increase my capabilities. I want new equipment." and this is what we did for them.

we explained to them the value of our manufacturing offer for furniture. It's call funiture on deman. It's a combination of Valia in furniture and Lectra and Gerber in equipment. let's see what value this means for the customer.

[Presentation]

So that testimonial summarizes the full value we can bring when Valia teams up with Lectra or Gerber equipment. Second priority is to accelerate the growth of SaaS adoption in our model for recurring, profitable, sustainable growth. Our goal is clear, to accelerate the adoption of all SaaS solutions in our portfolio on our installed base, maximize the number of solutions used per customer. We're going to review our commercial go-to-market model, the way the sales, marketing, customer success teams work together to facilitate sales, upsell and cross-sell.

We're going to work far more on data. We have huge amounts of data stemming from our solutions, loads of data that came from other solutions ERPs, EMS, we can create unique values by combining all these data and providing new services. In fashion, we have an extended fashion offering, create, manufacturing market, collaboration, traceability. It's unique. No other company has such an extended offering on the fashion market with such a footprint. Our job is to connect all the fashion players around the products, the same date, the brands, the subcontractors or suppliers. SaaS is a reality. It's no longer a theory. It's no longer a buzzword shown on slides. It's epitomized by the amount of ARR close on EUR 100 million of ARR December 31. The flagship solutions mentioned by Daniel have reached maturity. We're no longer of the proof-of-concept stage. We have a maturity across these solutions, TextileGenesis with one of the customers who felt about the value.

TextileGenesis is a traceability solution for fashion products. We look at the top 200 fashion brands, 140 have now opted for traceability solution. The 60% -- 80% use TextileGenesis. We have a huge untapped potential. Dido for launch metrics, the flagship solutions of markets to support the go-to-market strategies of our customers, be it for Valia, also a customer testimonial here for furniture. Our Kubix Link collaborative fashion platform aggregates all product. It's far more than a PLM. As Daniel said, it's a solution that allows us to design, create, go to market our products. I'm going to show you the testimonial of [indiscernible], one of our customers. They have quite a few stores in France telling them what

Kubix Link brings to the table.

[Presentation]

So these testimonials not just PLM, KubixLink come from an acquisition in 2018. KubixLab, a small start-up back then that tried to disrupt the PLM market as it known a few years ago. Kubix Link was still a challenger today on the market. It's KubixLink that is setting the tempo and it's the bedrock of our development strategy in fashion around data and collaboration within the fashion ecosystem. And the Final priority is to reach a new level in terms of operational excellence. We have very strong base. Lectra is recognized as a solid player, rigorous in terms of operational excellence. We're going to go further, improve performance, efficiency and promote the take-up of all the SaaS solutions, several initiatives that we've launched.

The first is to define common processes throughout the group, including all recent acquisitions on financial, commercial, marketing, customers some more processes. This is an effort that's already underway. We're going to reach new synergy levers that we couldn't have one single way of talking to the customer and is aligned as one with the customer, not appear as a company. Lectra launched metrics Genesis being common underlying. Second major initiative is focused on SaaS. We're going to redesign SaaS-related processes by drawing inspiration from best practices in the group, launch metrics born in SaaS, representing, as Olivier said, half of ARR of the group that grew through acquisition, reaching new levers of operational excellence.

We're going to profit from that to apply new SaaS processes in the group. We can accompany and serve our customers today. It's not a problem with the EUR 100 million in ARR and the dozen coming. It's going to prepare us to absorb twice that amount in the coming years. And then simplify the offer portfolio by phasing out nonstrategic activities. That's about EUR 20 million in revenue. These were activities mainly related to old nonconnected equipment, not compatible with Industry 4.0, taking time and resources. So we focus resources on high added value. We initiated that in the previous road map, that nonstrategic activity was the order of EUR 25 billion. It's slowly declining, and we'll continue to do so. This improvement in operational efficient internally will allow us to grow our investments to go further, better serve our customers, be more relevant. We're going to continue to invest in R&D, the equivalent of 12% of our revenue every year in R&D and accelerate the integration of AI and big data in office to better know how our customers use our solutions and how to create new products.

We'll also accelerate the renewal of generations of equipment. Following the acquisition of Gerber. We preserved Gerber Lectra equipment. We began to unify that portfolio. We'll continue to launch new equipment generations, which will replace Lectra and Gerber equipment far more efficient based on Industry 4.0, more profitable using the Lectra tech platform with better margin. We're going to invest heavily in our information system over the next 3 years. That will be around EUR 10 million per annum in CapEx for our new ERP to be rolled out and also change our CRM solutions linked to the CRM ecosystem, bring new solutions to our customers' success team.

Final point, as Daniel said, is to put in place more AI capabilities to automate low value-added repetitive tasks, streamline processes and free up more time for high value-added missions pragmatically with obvious return on investment. We're not, as other company doing, just putting in place AI for the sake of saying we're doing that. We want those tools to serve our customers and our teams. So as you can see, this road map for the next 3 years aims at building a model for Lectra that will be better, more efficient of higher performance and more profitable over time. We have 2 very -- 3 very clear priorities. Our campus, if I were to summarize, the potential is there. The offers are there. We have everything it takes to succeed in this new chapter of our transformation, and I'll let Daniel conclude for the end of the presentation.

Thank you, Max. So one slide that replaces the guidance, which tells you very clearly how we view things. In fact, we have 2 parts in our activity, a part where we have very considerable visibility another part where we have no visibility whatsoever. What we've decided to do is to give identifiers on everything that's under our control. ARR for SaaS, we expect to have an ARR that will increase 15% per year over the next 3 years. As you see, we achieved 14% in 2025. So it's a realistic objective. The higher ARR gets, the more difficult it is, but we think that target is realistic given the solutions we have today. That will lead to an increase of contracts of recurring contracts of 5% to 8%, depending on the growth of ARR and on growth of maintenance contracts that we hope will return to normal speed in '25, 2% instead of 6% because of bankruptcies and cancellations because customers were short of cash. We don't expect that to last forever. So 5% and 8% yearly growth over time and continued cost optimization. We increased our cost by 2% on average in the past 2 years. But it hides the fact that we've considerably cut costs on our traditional equipment, equipment, maintenance optimize hugely and invested in SaaS, both for R&D services and commercially.

We transformed our teams. We transformed our model with a total that has remained broadly constant and will remain constant, but with resources that are focused on issues for tomorrow. And we have teams that are geared up to support growth on SaaS and to continue to drive our activity on equipment and on equipment. The biggest engine for those savings and cost optimization. The most recent the stock of equipment, the few of the technicians we set out, we can process remotely. As Max said, 90% of problems that arrive at a cost, we send out a technician 1 in every 10 times. Previously, it was 50% of the time we had to take -- send a technician that is that our technicians are being sent out 5x fewer.

So it's high cost optimization. We have integration of Lectra, but to pull costs we have teams that can address both ranges simultaneously. That has generated considerable equipment savings. Gerber synergies we presented in October in 2024. That was over EUR 36 million. The EUR 36 million of synergies were invested or spent on SaaS solutions for tomorrow. We've saved and spent more with a total that's well nice stable. It gives us considerable strength to address the future. We'll continue to extend cost optimization throughout that period.

Lastly, when we look at what it leads to, we expect an increase of EBITDA margin of between 120 to 180 basis points, all other things being equal, if there's no rebound on the equipment and with exchange rates the same as those factored in at the start of the year. But mechanically, the growth of our recurring business and cost optimization will lead to an EBITDA margin increase of 120 to 180 basis points, not taking into account equipment rebound, which would be added upside on those numbers.

We look at one of the major Lectra ratio, security ratios, all costs covered by the recurring contracts business and consumables, the margin generated by the activity. Today, we're at 96%. When we start the year, 90% of our costs are already covered by recurring business. Our ambition is to increase that security ratio by 2 to 3 points a year to exceed 100% so that 100% of costs are covered by recurring revenue. Those are the 2 targets, whatever the cycle and a possible rebound of equipment that will be added upside.

Over and above that, we will continue a targeted acquisition policy. We have several companies we're interested in. The issue is valuation. These companies are valuated far too highly by their current shareholders either because they're private equity, and they compare that with the valuation of the last round 2 or 3 years ago, the principle, I invested EUR 100, I must sell at EUR 300. They say, we're prepared to be reasonable, let's say, EUR 200, but we say no, our valuation is EUR 60. We have some way to go. A number of companies we've met are interesting. We have a team that screens the start-ups or midsized companies that complete our offer, and they meet about 100 companies a year.

And Max and I meet with some 15 that are interesting, but there's no match on the valuation, but there is a fit in terms of the interest and synergy with Lectra.

And lastly, we'll continue our dividend payout, 50% of net income. In fact, 40% of net income restated because we have a portion that's linked to previous acquisition, but we refer to reflect it by saying 50% payout ratio.

The objectives are summarized here. So part of our activity, 75% recurring where we have visibility today. These are numbers that we control well. We control the costs on this portion, 120 to 180 bps on EBITDA margin, we're very comfortable for the equipment. We don't know. Depending on the day, we wake up and say, tomorrow morning, it's going to bounce back. And then there's negative announcement, positive announcement. If you ask the question on Monday, I'd say we're far more optimistic; on Tuesday, I'll say we're more pessimistic. We don't have a crystal ball, but maybe there's something that plays in our favor. After a while, people get used to that, they're beginning to look at things pragmatically and say, what am I going to do now the situation is clear. It's something that over time is set to improve because now in every country, people have visibility, clarity on tariffs, customer relations, which will make them more comfortable because there'll be less uncertainty.

Now the 3 of us are on hand, should you have any questions. Now for those of you attending remotely, feel free to ask questions. We have our Investor Relations team who will relay the questions to us. Feel free to ask questions in English or French. They will be translated into French for us, and the answers will be translated into English for your benefit.

When it comes to synergies with Gerber, a lot has been done already. The design machine market is quite sluggish at the moment. But do you have a unified platform?

Well, based on our estimates, the synergies come to over EUR 40 million a year. And the main source of synergies is the fact that there's cross-selling potential. We can also sell SaaS software packages to Gerber customers. And also, we've streamlined equipment, and we're selling more and more Lectra branded equipment.

Our U.S. customers of Gerber, they see -- they can see the difference of they're switching to Lectra equipment for which the profit margin is much higher. And also, there are synergies when it comes to costs, we've been able to optimize all of these services teams. So over EUR 40 million synergies in 2025. So -- and we've used that money to invest into SaaS. And this is why we are well positioned when it comes to SaaS.

So we are replacing 2 ranges of products by just one. Of course, it will take time, migrating the installed base in terms of sales support and that's important. And the second aspect, when it comes to the future, we only have a single R&D plan. So whenever we develop a product, it covers both installed bases, whereas in the few years that followed the Gerber acquisition, it took a lot of work, ensuring interoperability between the 2 ranges of products. Now whenever we design a new product, we develop it just once, and it applies to both installed bases. So this means untapped potential in terms of synergies.

I have a question regarding EBITDA. When you said that you intend to increased the ratio from 120 to 180 countries. That means you're planning to increase EBITDA from 17% to 20% in 2028.

At the moment, we stand at 15.1% looking at the ForEx on December 31. So yes, this does mean over 20% in 2028.

[indiscernible] I have 3 questions. First of all, Valia, the adoption or conversion rate, what do you anticipate by 2028? And also in your guidance, do you also consider penetration of the installed non-Lectra equipment base?

Second question, when it comes to, Valia, but also the other SaaS offers, do you intend to revisit the sales organization? Have you taken initiatives already to that effect? Yes or no?

And third question, regarding launch metrics. This is probably your software package that has the most exposure to generative AI. So what are your solutions?

Let me take the first question regarding Valia. As we said before, we have about 70 customers that currently use Valia for production purposes. And Valia is their only process workflow when it comes to Lectra equipment, whether Lectra or Gerber or any other third-party equipment. So there are no limits when it comes to our ability to ensure operability with non-Lectra equipment. So if we look at the number of products that have been processed by Valia, the more equipment we connect, the higher the subscription rate and the more value we create for the entire customer production process.

So as I tried to explain before, there's a lot of potential when it comes to helping our customers migrate towards Valia. We had fewer than 10 such Valia customers. We announced a disruptive revolutionary solution at a time when a lot of customers had already finalize their budgets and see the pace of growth in just a few months. We have customers that are already using Valia's predecessors, and we need to support them as they migrate towards Valia and also our installed base needs support migrating to Valia.

Now from a sales point of view, from the point of view of go-to-market, I'm talking about sales, marketing and customer success teams, they need to work together because they are increasingly specialized solution by solution. In other words, each customer has a contact person. But then we have presales and customer success teams that specialize offer by offer, product by product because it's more relevant to work this way. We're able to better showcase the value we provide and so we can better support our customers and their users when it comes to the new solutions that they embrace.

So that's a shift. It's a group-wide shift, and this affects legacy Lectra equipment, but everything we're doing with Gerber, [indiscernible] and launch metrics. So we present a united front when dealing with customers. And who are our discussion partners, the C-suite level individuals, COOs, CEOs such as the [ EdCom ] CEO. So we need to speak the same language with our customers. And it doesn't matter who the person is, what they specialize in, what their job is. So we initiated that transformation last year, and we will fast track it even more in the coming years.

And could you please remind me what your third question was? Launch metrics, yes. Now ARR grew by 9% over the first 9 months of the year, rather over 12 months. And that remained unchanged, 9% growth in ARR over 12 months. And the total increase in ARR is 12%. So we're seeing a 9% growth rate. And this means that the other solutions are performing even better. Do the math. So there's huge potential for adopting these new solutions.

And Generative AI is not a technology that scares us because we've already integrated it into Lauchmetrics and other offers. It's great for generating graphs and images and visuals and -- but it needs to be based on data that should be understandable for this type of AI. And that's what Lauchmetrics does. It analyzes everything that's happening in terms of social media, all of the paper, all of the press clippings so as to be able to provide insights to customers so that they can better manage marketing investments [indiscernible] shows the value provided by Lauchmetrics to those brands. Just because some brands aren't doing too well, it doesn't mean they stop investing. On the contrary, it's the right time for them to transform themselves and the solutions we provide in our portfolio are the drivers behind that transformation.

I have 3 questions. First of all, a follow-up question to the previous one. You talked about your road map. Have you tried quantifying over the next 3 years, the proposed penetration rate of Valia for your installed base, we're talking 9,000 or so machines? Also the growth in profit margin. Is it mostly driven by your SaaS offers? Or is there continuous efforts in terms of reducing costs and labor costs and also M&A? On the M&A front, anything you're targeting over the next few years? Is it mostly SaaS in the short term? Or are you going to target technology building blocks rather? And also, you talked about market cap being too high. Could you give us KPIs? What's the threshold beyond which an acquisition is too expensive for you to agree to make it?

We are confident when it comes to our growth -- our projected growth between 2026 and 2028. Maybe this doesn't answer your question, but we are convinced of the value Valia provides. And over 2026, 2028, it's hard to quantify. The scenarios are based on the pace of buy-in by our customers. If we get back to what we said in October regarding fashion, we had 17 customers and a few more in furniture and automotive. So we almost doubled the number of customers in Q4. This time, Q4 is very encouraging because the pace of buy-in is much faster than expected, but things are still difficult because we're looking at every information system. A lot of factors involved. So it's hard for us to estimate the pace of adoption. So if we compare Valia with its predecessors, the growth in ARR in 2025 was 31%, which is pretty palatable already. I mean the figures aren't huge, but 31% is nothing to sneeze at.

So are we able to quantify? We'd rather not say at this point because the range of assumptions is extremely broad. Things can go really well. They're going well now. We've gained traction on the market already, but we can't possibly know what the future holds.

When it comes to your question on EBITDA, yes, clearly, one factor is our SaaS business, the fact that we're developing because for most of the solutions, we've achieved critical [indiscernible]. And that's when we generate an extra EUR 100 in revenue, we have between EUR 60 and EUR 80 that go into EBITDA. So critical size, critical mass is an important factor. In other words, mature companies such as Launchmetrics have developed their EBITDA much more as opposed to a growing software companies such as TextileGenesis. So the growth EBITDA mix is improving. So when you add up EBITDA and increase in ARR, this exceeds 40%, at least for mature lines, TextileGenesis, [indiscernible] and Launchmetrics in 2028. That's our compass.

When it comes to costs, and this is in line with recent years, there's a source of savings, the synergies between Lectra and Gerber and those synergies will continue to materialize. I'm talking about maintenance, of course, but also equipment. And also, we will optimize costs across the board. This is something that we're keeping a close eye on. So more and more synergies will emerge as we design products that apply to both Gerber and Lectra equipment.

We also have specialized teams vertical by vertical, solution by solution. And more and more, we lie at the heart of our customer strategies. And so our customers, they want to meet with our top regional heads. Max, Javier, myself, they only want to talk to the top people. So we organize meetings, and this is how we get the ball rolling. And very often, in our meetings, we meet with several members of the Executive Board, and we have strategic discussions. That wasn't the case several years ago, not necessarily. And this encourages us to continue as [indiscernible] in our customer strategies.

Now when it comes to SaaS, usually, the ROI for customers is 24 hours. It is 24 hours for the customer to generate ROI. And just 24 hours, they generate more money than the cost they paid. And that means a lot. When it comes to Launchmetrics, we use it to optimize marketing budgets which is the lead expense item for all luxury and fashion brands. And now we're able to quantify ROI by using Launchmetrics. The marketing budget is much big used in the past. People try to optimize what they were doing. Now they get to optimize their costs. And this means they need less money to -- for the same scope of activities. They're able to better optimize their marketing budgets. And this is how they improve their operational ratios. In 2025, we had the lowest churn rate for Launchmetrics than its entire history. And this shows how much value we generate for customers.

Now I'll let Max answer regarding acquisitions.

We will pursue the same strategy as since 2017, we target mostly start-up companies in the [indiscernible] universe with key Industry 4.0 technologies, IoT, big data, AI, et cetera. So we're looking for start-up companies that can support, supplement and enrich our product portfolio. In fashion, we have a pretty extensive offer, design, manufacturing, marketing, traceability, et cetera. So what we want to supplement is coverage of our customers' process -- manufacturing processes.

Now 2 years ago, we could have said that the market cap was in line with the market. So 10, maybe 15x ARR. Today, multiples range between 4x and 6x. It depends on how healthy the company is. It's not me saying that is the market. And obviously, we don't want to pay too much for companies simply because they've added AI to their pitch because there's a difference between dreams and reality. So we are extremely cautious. We tread carefully. We really want to create value for our customers and also for our teams because we're bringing specific expertise and also we want to generate value for our shareholders. And we're not going to make an acquisition if we don't take all 3 boxes.

If we look at our track record, first of all, the Gerber acquisition went off without a hitch. The figures show that. Customers as well, we lost pretty much a 0 customer. And we've held on to all the teams we wanted. The only people who left the group were hired by the private equity group to ensure the turnaround. So we consolidated our teams. We shored up our customer base, and we generated a lot of synergies.

And if we look at our 2 key acquisitions over the past 3 years, TextileGenesis and Launchmetrics. TextileGenesis improved penetration when it comes to traceability and sustainability, which are highly sensitive aspects, 80% market share for the top brands. If we look at the entire traceability market, over 60%. And the rest of the competition, they have to share what's left. So we've gained a leadership position that's very strong over the past 3 years. And also the pricing system depends on the volumes that transit through the platform. And this will naturally increase over the next 3 years simply based on existing customers without even factoring in new customers. At the moment, there are 4 billion products. So by product, I mean a particular piece of apparel for a given colorway for a given size. So 4 billion products transited through the platform and 23,000 companies are logged into the platform, and we charge textile manufacturers and brands. So on both sides of the -- on the other side of the spectrum.

And in the middle, access is free because we wanted to create a community. Eventually, we will build. But at the moment, we have 23,000 companies that use TextileGenesis as a platform every day. And some of our customers go through our platform for 100% of their offers. So we know what that brings.

When we bought TextileGenesis, a lot of people -- I remember we paid EUR 30 million for this company, whose ARR was only EUR 1 million and a lot of people had questions about that. But we -- that was a sound move. We've proved Launchmetrics, EBITDA was negative, negative double-digit EBITDA. And now it's plus 20%, up from minus 20%. See, we've really focused on profitability and growth remains significant. So our target was 10%. We generated 9% growth considering the circumstances is pretty good in terms of ARR. So we're able to -- we've been able to combine that growth with an improvement in profitability.

When it comes to our latest acquisitions, we have proven our ability to make acquisitions that generate value for Lectra. Now we bought a small company in the past, Kubix Lab, a team of 4 people, 0 revenue when we bought them, and now it's a linchpin of our offer. And at the time, we paid EUR 8 million for it. So compared with today's ARR, yes, we're talking 0.0-something percent of the ARR. So we tread very carefully. In this type of situation, I understand that some of you may be scared and -- but we'll never prioritize our egos or let our dreams get away from us.

Launchmetrics, we talked for 2 years. We did our due diligence. It was our top target out of 200 companies that we screened, and we continued discussions until we felt ready we felt confident that the agreement would be favorable to us.

So I think we'll be very prudent, very cautious today. We have situations. I think the valuations will align at some point. We have the 2 factors, private equity saying, I want to multiply my initial investment, but life is no longer like that. And then we have founders pitch, I've got AI in there. So it's more -- in terms of AI, we know it better than they do. So we can separate the speech from the reality and very often the words exceed the reality.

Yes. I just got a question too clearly on this [ Kubix ] upstream will feed into Valia downstream for product. Launchmetrics, how is it going to fit into the grail would be to integrate everything, right? That's what we're working on with the customer. To give you an example, when our customers design collection, they no longer start with design. They start by analyzing the market to who they're going to sell at what price. What's the breadth, the depth of their. We're no longer the day where fashion is driven by style. Fashion is now driven by the go-to-market, and that's where we have our offer with net Launchmetrics that comes into play this ability to understand what the trends are, how brand can position itself, set itself apart from the competition, what price through what channel we'll sell it. That's how we set up these collection plants, how we produce the garments in the right quantity.

I see with Kubix and Valia, but how is it going to happen? How is it going to be sold, invoiced? We have solutions by circle, [indiscernible]. They each have the critical persona, the model. The business model is very often business-driven product process, quantity, the peers were monitoring. And at the end of the day, all the value linked to the product transits via Kubix Link, be it in the market, creation, manufacture or traceability. We have customers who've already integrated Kubix Link and Launchmetrics.

As I said last time, customers have included the samples of Launchmetrics, the analysis by Launchmetrics on the trends, product categories, various level breadth and depth of collections and Kubix mix, that's active and available. We're going to go further. How to combine everyone? Today, they use one solution, one platform. We want them to work around the same data with the same language, and that's possible with Kubix Link. It's a collaborative platform. We rates all the product data where they come from Lectra or non-Lectra solutions.

Take another example, as Daniel said, we have over 20,000 23 actors in the fashion supply chain. In textile genesis, they declare who they are, their audit certificate, their production capacity. We retrieve that automatically in Kubix Link. We don't need to ask our customers to enter that data. We link it to the manufacturing production [indiscernible], company was involved at such time for such product. For tomorrow's product, it's additional insight to know what player could be the best place to produce the product that will be in your wardrobe in a few months. So that integration is largely already present.

In the next 3 years, we plan to step up that integration. It will create value. And as Max said, we have a pricing scheme that's based on usage, the value added that we produce the outcome and not the number of users. Most of our solutions, number of users is unlimited because we realize that the more we have people who use our solutions, there's more the flow that transits and the more money we get, we're paid in proportion to the flows.

Next question.

Yes, we've got a number of questions that have already been answered. I see one on ARR growth. Do you think it might be even higher in 2026? 15%. We said our ambition is to achieve 15% average growth per year over the next 3 years. Of course, the higher the nominal base is higher, the higher that percentage will be there. We strong believers in that. We've launched solutions, Valia, TextileGenesis, which will nurture this potential growth of ARR. As Daniel said in his conclusion that 15% number may seem ambitious, but it's realistic. And we can think that there are pretty mature solutions where we control growth at Launchmetrics, we are at 9%. If it's not so good, it will be 8%. If it goes well, it will be 12% or even 14%, but we're not going to exceed those types of numbers given maturity on Valia, it's very open. We don't know if the growth will be 10%, 20%, 50% per year? We'll see that gradually. The 15% seems to us to be realistic. Our goal is to be at 15% or north of 15% as a target for the next 3 years.

There's a question on Launchmetrics and this 9% performance. How do you explain it? It's viewed as an adverse performance. And what are the prospects in terms of top line growth and EBITDA growth. The target was 10%; with today's troubled times, 9%. I don't think it's subpar performance. I think it's good performance. Launchmetrics, EBITDA is above budget. If I remain on a rule north of 40 some of EBITDA plus ARR is above what we set by way of a target for 2025. We upped EBITDA more than expected with ARR growth. It's 1 percentage point below because we better optimize costs and pulled all the items.

When we look at the large luxury companies, we're talking about an ARR in hundreds of thousands of euros. And for the mega players, it's between EUR 1 million and EUR 5 million per annum, and there hasn't been any churn on those solutions. So there's very great confidence of the luxury market. And the most challenging market is at the beginning. There were other targets such as the fashion press that's faring less well and where we have no development today. But when we look at customers who initially are Lectra in fashion and luxury, the growth rate is higher for all those reasons, we're very confident. What's more we believe that it's not an adverse performance. It's performance that's quite honorable compared to the situation.

Just to return on the orders front, which is your daily concern. One day, you're optimistic, the next less so. When I look at Q4 there's a degree of stability in the U.S. Europe is flat and Asia is down. So in the year, there was a real reversal in the 3 areas. How do you view all that? The lead indicators and the fact that adoption in the U.S., it's perhaps stronger. And you mentioned that in China, it was difficult with automotive and reduced number of manufacturers. What can we have by way of onboarded information on the latest trends? What can we project your reasoning in scenarios just to assist us?

Well, firstly, when we look at the Americas, we tend to think the United States, our #1 center for us is Mexico. Even our U.S. customers manufacture essentially in Mexico. So the revenues in Mexico. Very often, the Trump administration talks about manufacturing in the U.S., U.S. brands. There's big confusions. Most U.S. brands manufacture in Mexico, perhaps more Europeans in the U.S., but we confuse the fact that the brand is American. Our #1 manufacturing center is Mexico.

The greatest problem was all the [indiscernible]. Is the NAFTA deal going to continue or not? Today, it's in place. There's a June 30 review clause that's what worries people. If it's adopted in the agreement maintained, we should return to normal. The potential is there and things will grow. That's for automotive.

Fashion in the U.S., there's practically 2% of fashion items sold in the U.S. made in the U.S., practically 0, but Mexico or Central America, there'll be manufacturers who are in the same situation as automotive with favorable tariffs. So in the U.S. and in the Americas, there are 2 positives, stability in tariffs and an exemption for many products in Mexico and a ramp-up of other markets in the figures of Olivier, aeronautics, military, security, a whole slew of things that are promising business is highly developed in the U.S. So today, we have reasons to be more optimistic on the rebound in the U.S. that isn't at all driven by the situation we had in '25.

In Europe, well, the fears were unfounded, a fashion company. I'll cover the 2 main markets, fashion, European fashion exports 20%, 30% to the U.S. Tariffs are up 5%. That's 1.5% of growth margin. You have to divide by 2 because it's on the transfer price and not the sale price to the end user, real impact less than 1%. So unfounded fears. We're back to normal in Europe on fashion. So it's really the mindset and confidence in the future that's at play because the situation is rather good today.

In automotive, it's more strained. European manufacturers are under pressure. The Chinese are arriving. For Lectra, if we have a Chinese customer with a plant in Europe, it's not very different from the European customer with a plant in China, European markets. It's not European brands. It's those who manufacture in Europe. Trends are stable as we've seen, there are those who need to change, change strategy and produce differently as they continued now with product development cycles of 3 years and manufacturing systems that date back 20 years, we have Chinese brands that are at the cutting edge. What can create positive effect is the new effect. New Chinese industries will have to gear up and equip. Our competitors don't have presence in Europe. So we're favorite in the Chinese ecosystem in Europe.

And then our historic clients in automotive in Europe need to change. So in Europe and Americas, we could see a return to normal rapidly, barring any upheaval. In Asia, it's more challenging. The country that's benefited the most of late is China. We were at the same tariff rate on the eve of the Trump announcement, and we need obviously to read the rooms of the messages, not the impression that we have at face value for the press releases, there are companies that are being favored. April 2 announcement, the Indians felt they were in favor, limited tariffs and then 50% penalty slapped on them for buying Russian oil. And now officially, they're no longer buying Russian oil. But I have my doubts. I was in India a fortnight ago, even the officials weren't aware of that, but they're going to stop buying Russian oil. And so tariffs have gone from 60% down to 18%, 18%. They're the most favored nation in Asia. So that's creating a lot of turmoil.

When I take Indian clients, they've gone, okay, now our hour has arrived in April, are we going to be able to pay the wages next month? So we can think that, that situation will stabilize. And one of the advantages for us when we look at the glass half full or empty is that we're far stronger in countries that are favored by the new tariff deals in terms of market share and strong in India, Sri Lanka, Bangladesh and stronger than China in Vietnam. So all that will play in our favor because the shift in the market, if it plays out, that's where the most advanced [indiscernible] about MAS, MAS has 23 plants and over 100 Lectra equipment. So European players with Lectra cultures when he has 4. The mammoth players that have 100, 150 piece of equipment amongst the only ones who didn't stop investing during the period.

We look at these companies present everywhere. Well, they do natural hedging because they produce in many countries. It takes them time to shift. They've better distributed or shifted production for the U.S., for Europe and Asia. So optimize the tariffs. So they'll emerge winners. There'll be market consolidation, very strong in Asia for fashion. So there are a number of things that are positive that lead us to hope for this rebound that will occur in places, Europe, United States and certain Asian countries where we're far stronger.

So if I look at things going forward, I'm optimistic. If I look in terms of timing and maybe a comment additionally, 100 announcements made by Trump, 0 were implemented as announced. To know what's happening, you have to go on the custom side, read the implementation orders, and they're very different. Sometimes they bear no relationship whatsoever to the press releases and announcements. So all that is under control. We've understood the impact before the others. Everyone were taking the statements at face value. China is the only country in the world that hasn't seen its tariff increase. It doesn't sound natural. The advantage factually is that the countries favored by the new situations are countries where we have far higher market shares and a far stronger presence in the customer. So it makes me optimistic. Obviously, we refuse to make forecast.

We just had 2 pieces of good news on India Bangladesh, far from negligible important countries that's going to relaunch investments. We can have further news tomorrow.

Aleksander Peterc, Bernstein. Just a couple of questions. One just a detail. When I look at your Valia offer, you say that it's kind of agnostic equipment. What's the percentage of non-Lectra that you're connected? Is it marginal? It's important priority? And second about your guidance when you say that we keep what we can model ARR there. We're seeing very good growth, okay. But on the nonrecurring side, when you say that the scenario today have no visibility, so it's flat. Is the situation where it can decline further or we reach the bottom, we don't know how long it's going to last?

First one for Max.

We announced that compatibility only a few weeks ago. End of October, we just announced it. We came out from that announcement in China. So we're really at the beginning of that shift amongst the 70, about 10 customers with non-Lectra equipment connected. It's a small percentage. If we look at the potential, you'll see that we have 9,000 Lectra equipments, natively IoT and 5,000 non-IoT compatible and the others, there's thousands, dozens of thousands after that for us. It's going to be a quest to not only connect those pieces of equipment, explain to our customers how by replacing those equipment with new Lectra generation, they'll be more efficient and reduce their cost. That's the past for us.

Now the ratio is currently very low, but will increase quickly. The great thing for customers is they only have a single workflow of data and equipment. At the moment, they're specializing their workflows based on the type of equipment. This is why I mean it's a true revolution. You need to change your process and your mindset. So we are confident and our customers are very excited. And we know we will phase it in, but there's huge potential.

Now based on the initial implementations of Valia, initial figures show even though we can't really mainstream, the materials gains has increased by 50% as opposed to cutters that are not Valia equipped. And this means customers recoup their subscription costs very quickly. So -- and the time it takes to develop the product is divided by 5. You can make a decision only one week ahead of time instead of 5 weeks ahead of time. And you can fulfill orders very quickly. And the true value generated by Valia is about everything else. Customers realize they're going to make money off Valia, but the real benefits materialize later.

In terms of equipment, this is not a scenario, let's be specific. We have a calculation. We have an assumption if the number of equipment and systems is the same as before. If we bear in mind inflation, this is what we end up with. And we let customers decide what they want to do because we don't have a crystal ball. We can't possibly make forecasts. We'll see what happens.

Can things be worse? Of course, in absolute terms, say there's a war that breaks out. You don't know what's going to happen when Trump threatened to invade Greenland and called Europeans enemies of the U.S., and we thought we were long-standing France. Yes, things can get difficult. There's a war in the Middle East. Yes, there can be an impact. If the -- if the war between Ukraine and Russia comes to an end, this could actually be good for us.

We don't know what the future holds. We are all hands on deck. And we're seeing minus 19% for equipment in 2025. It's not good, but at least it's not minus 50%. Remember, overnight from -- when we went from March to April, we lost 70% of our equipment orders. And now it's only minus 20%. So barring a major development, it's not going to be worse, but things could actually be much better, but it takes a while before customers assimilate the news and change their budgets. So I'm very optimistic when it comes to the next 3 years. If good news materialize in April, but it takes until September before customers assimilate the news. We may have to wait an extra year. So we're not sure about the phasing.

We firmly believe there's going to be a recovery. We just don't know when and how big that recovery is going to be. And we refuse to make forecast because [indiscernible].

Any questions? Any other questions? If you have to leave, we totally understand. I have a question regarding the dollar. What happens if the dollar continues to go down lower than 1.17.

Well, we hedge 100% of our balance sheet, but not future flows every time we give information based on dollar parity because there can be a potential impact on the conversion of dollar-denominated figures into euros. So if we look at the management report for every EUR 0.05 in terms of the dollar going up or down, the impact on revenues is EUR 1 million and the impact on EBITDA is EUR 4 million. So when there are wide dollar fluctuations, there can be a huge impact when it comes to the competitive landscape, a number of competition of dollar-denominated business, and we need to look at the sale price. But otherwise, no major changes when it comes to our policies.

And this brings me to the next and final question. The competitive landscape. How is the competition positioning themselves relative to you, relative to your performance? Maybe we should start with equipment because usually when we get that kind of question, it's usually about equipment first. We have small customers across the world, but they're very small. Our main competitors come from China. In China, there's one big player called [indiscernible]. They're held by a company called [indiscernible]. They're a listed company. And [indiscernible] made that acquisition, [indiscernible], which was #3 back in the day, the #3 provider of cutting equipment. That was a German company. So [indiscernible] is a very strong company. They're an industry player. They're fully capable of improving their unit costs spectacularly. And now they're #1 when it comes to sewing machines. And in China, they're very strong because they use their network of sewing machine distributors.

So they sell quality products, but they provide 0 services. And also, they're not good with software. That's their weak point. So what really matters when it comes to equipment nowadays is the onboard software. Now when it comes to China, we have between 30 and 40 smaller competitors. Max, and I attended the Shanghai Trade Show on March 6. I've been going there for years. And 2 years ago, there were 40 competitors represented there. This year, 40 as well, but 20 of them are new. Because there were 20 new ones because they came in and replaced 20 companies that went belly up. So if you take the average value of EUR 60,000, multiply that by 50, we're talking EUR 3 million at 30% margin, there's EUR 1 million in margin. If they sell EUR 100 million, that's EUR 2 million in margin. With this, they pay production, R&D services sales teams. There's no way they can survive very long.

So the downside is that these competitors are driving prices down because customers are thinking maybe it's better to pay for just 1/3. It will get the job done. We'll see what happens in a few years. But in a few years, because there's 0 maintenance on the machine, productivity goes down because -- the equipment looks great on day one for the demo, but performance deteriorates very much over the years. And as a result, all those smaller players are unlikely to survive. Maybe 2 or 3 of them will have longer lifespans, but I'm telling you, a lot of them are going to go belly up because market conditions are tougher and tougher.

So in 2 years' time, chances are over 50% of them will have disappeared. So the competition in China is exacerbated because those companies are so desperate. They're willing to give the product for free for a whole year because they made the products, and they can't seem to be able to sell them. And the prices are so low, they make no sense, and that's how they hope to survive. And there's no way they will survive. I gave you the figures. I can't see why any company can survive. I mean, it takes us EUR 12 million to develop a new cutting machine. And in total, they spend EUR 300,000 a year, no way. There's such a strong disconnect. There's no way they can make it.

Now maybe a lot of customers will decide, okay, well, that kind of equipment is good enough, it will get the job done. Well, at this rate, just use manual pair of scissors, it will get the job done, too. Now customers have seen the difference in terms of profitability and productivity. And they see the difference between Lectra cutting machines and the competitors' products. I mean, look at the textile savings. You use much less material. It's day and night in terms of productivity gains. And that is why [indiscernible] like I said, they are our top competitors in China. And of course, somebody had to take second place. But as far as the others are concerned, we don't see them as any kind of threat because they basically self-distruct. It's a price war, and they're fighting over the same customers.

On the software side, just to wrap up, now create, and that's our core business. It's been our core business since 1983, 1984 pretty much. We've been #1 when it comes to computer-aided design, and we're very strong in the European market, thanks to the Lectra software. Gerber was #1 in the U.S. So we are very strong in the U.S. as well. And so our market share is difficult to estimate, but probably above 65% in Europe and in the U.S. Why? We don't look at our global market share. We only look at customers. When it comes to premium brands and luxury brands, we're closer to 80%, 90% market share. But if you look at the entire market, we still have a very strong position as opposed to Asia, where our position is weak because customers bought locally produced software, which was much cheaper. So much for design, for creation. Like I said, in Asia, we're not the preferred player because the economy there is different. But in the U.S. and in Europe, we are very strong.

When it comes to automotive production, global market share, over 2/3 when it comes to textile coating machines and about 50% for leather, over 2/3 for airbags, our market share is very significant. And in [indiscernible] competition, they're sharing the rest of the pie amongst themselves. Things can always shift, but I think we are very comfortable.

If we look at markets, there is no equivalent to Launchmetrics. We are very strongly positioned. And we've talked about TextileGenesis. We have vast market share when it comes to traceability. Our competitors are start-up companies to receive funding from private equity, and this scares a lot of major luxury players because they don't know how sustainable this is. So we are the preferred player.

And Kubix Link, just to wrap up, we've seen the impact of the latest publications by [indiscernible]. As you know, I'm not a fan of their financial disclosures. I said that many times. I mean, always having to read the footnotes. But if you look at what they said about the product, it doesn't work at all. It will work initially because it changed the management structure, great. But I don't know where that is. The thing is customers made their decisions on December 31, not a year later. So if you look at their disclosures, at least in Europe, we secured 60% of contracts. It was 1 in 10 against [indiscernible]. We would win in 10% of the time 5 years ago, now 60% of the time. Now Prada, Burberry, they use the biggest PLM systems in existence, particularly in the luxury segment, and we have customers that are extremely satisfied with our products.

So we're starting to grow in the U.S. We're very well established in Europe. But we're starting in the U.S., and we have 0 presence in Asia. But in the meantime, we only have one major customer, and that customer is losing steam for various reasons. Their technology has aged and their sales methods can work short term, but cannot establish a strong long-standing relationship with customers. So we feel really good about the competition.

Our #1 problem is the macroeconomic environment. It's not the competition. Needless to say that macroeconomic environment, particularly when it comes to equipment sold in Asia, Asian customers prefer cheaper solutions because if you're running out of cash, is it better to have a cutting system or no cutting system? This means that we may lose contracts to smaller, low-cost competitors, but not because of the technology. Our technology is much better.

Okay. This brings the Q&A session to an end. If you would like to talk some more, come and see us directly. Thank you so much for attending today's session, whether you're here in person or logged in online. Thank you.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]