R Stahl Aktie

Good morning, ladies and gentlemen. My name is Holger Angrick, and I'm very excited to welcome you to the R. STAHL Earnings Call for the First Quarter of the Fiscal Year 2026. The results will be presented by the CEO, Dr. Claus Bischoff; and the Chief Commercial Officer, Tobias Popp.

[Operator Instructions] We will record this earnings call, and you will find a recording later today on the R. STAHL web page in the IR section and also on our research hub. We are covering R. STAHL and I will supply a link to our comprehensive research in the chat box in a few moments.

Thanks so much for joining this call, and I will now hand it over to Claus and Tobias. Gentlemen, it's all yours.

Good morning, ladies and gentlemen, also from our side. We warmly welcome you to our Q1 earnings call. My colleague, Tobias Popp.

Good morning.

And myself will guide you through the financial figures. And in the end of the call, we will give you an update about our future program, NEXUS.

Let's start with the overview and the financials of Q1 2026. We are reporting a stable and solid quarter, which is really a good news, taking in consideration the geopolitical and macroeconomic challenges out there. Order intake came as planned on a level of EUR 77.2 million. Of course, this is below the all-time high of Q1 2025 but it's significantly above Q4 2025. Sales remained stable at EUR 73.4 million, which is quite exactly the level we had last year. Notable is that Asia Pacific region was very strong due to onetime projects. Due to hard work on cost optimization, we increased EBITDA pre by EUR 3 million, and we are now at a level of EUR 6.7 million.

In parallel, net profit roses to breakeven. And, let's say, challenging news of today's call is that still free cash flow remained negative on the level of last year. This is mainly by expected after effect in our working capital. I come to this later. If we are looking on the income statement, as mentioned, we are better in profitability due to cost reductions. I really like to highlight here that our material ratio is now below 33%, which is, in my perspective, benchmark in the branch. And the team did here within the NEXUS program, a really good job to bring this on that level, and we continue.

So having this said, cost of materials now down to EUR 25 million, and we also could decline our personnel costs significantly by roughly 10%. Mainly this decrease is driven by cost-cutting programs initiated in 2025 but also we see now upcoming effects of the future program NEXUS, especially in other personnel costs.

On the other operating expenses, we are still high. This is something we have really to work on. Main reason is here that we still have a significant level of temporary workers that need to be addressed in the upcoming quarters. With the mentioned cost improvements, we are now in a positive EBIT, roughly around EUR 1.8 million. The financial result is a bit worse compared to last year due to a higher credit realization. At the end, EBITDA is at breakeven. We suffered a bit on the taxes because we had a significant project business in high-tax areas, which leads then also to a net profit at breakeven.

Overall, as I mentioned, good news EBITDA pre is coming up significantly, and we are now above 9% in margins. As we mentioned already last call, the target for us midterm is to come above the 10%. Free cash flow, here, we see from the improved net profit that we could stabilize the amortization on the same level and also the other income so that the cash flow itself is now on a significant good level, EUR 4.6 million compared to EUR 1.6 million last year. This is up of 3%. Then we have the big hit in the working capital. We have here roughly EUR 7 million. Main reason for this is expected spillovers from 2025 because in 2025, we planned a much higher 2026 salary level. We did a good job on bringing down costs but we could not terminate all the orders we had out to our suppliers. And this is now the spillover we have to work on.

Two key measures are in place. At the beginning of this year, we have now a corporate value stream responsible, which is carrying for plants, logistics and purchasing out of one hand. And the second is we are now have implemented a forecasting system that ensures that our working capital is aligned to the need of sales. Due to these key measures, we expect significantly down in the working capital in the upcoming quarter 2 and quarter 3.

Cash flow from investing activities, we reduced. But with the hit I mentioned already on the working capital, we still see then the negative cash flow on the same level of last year. To compensate then this negative cash flow, we had to work with debt so that net debt is increased now by EUR 5 million, so that we are now roughly around EUR 40 million in net debt.

Sales remained stable. Asia Pacific, very strong. Generally spoken, we are still faced with a rather conservative investment behavior across all our industries and across the countries, the regions. mainly caused by exogenous factors like geopolitical uncertainty, conflicts and internal factors like market and cost positioning. On the internal ones, we are working with our NEXUS program proactively.

In detail, Germany dropped quarter-by-quarter by 13.6%. The Central region dropped by 10.2%, Americas by 14.5%, Asia Pacific, on the other hand, had a significant positive peak due to the earlier mentioned project realizations, which was booked earlier in 2025. So overall, in consequence, the gross regional weighted sales remained stable at 73.4% (sic) [ EUR 73.4 million ], which is nearly the same level as we had in Q1 2025.

Moving to the strategy. Tobias and myself being in charge now for 4 months, did an amazing job to focus on shaping the strategy of R. STAHL. I was very happy getting with him a partner that has more than 30 years of experience in the company that could be linked with my experience, roughly 30 years in global industries so that we together can shape the future. And we were driven by our passion and our personal commitment to bring the company on the next level. We involved internal experts as well as excellences from outside, pushing the company forward and going for global excellence and future readiness for R. STAHL.

Outcome of this work is the future program NEXUS. We shared already and introduced in our earnings call 2025. Nexus will guide our way from today being an expert for components becoming a solution provider for harsh environmental and explosion protection in 2030. Key element here is that a solution provider, we will then have the chance to multiple cash our valuable competence by selling standard products, by adding to our standard products automatization, combining them to solutions and facilitating then over the life cycle of the usage of our products by services. This multi-caching will allow us to reach a sales level of EUR 500 million in 2030.

NEXUS is much more than a program. Nexus is our way into the future and to secure this way, it is a 3-stage execution. That means each of the 3 stages we will now share with you is self-consistent in terms of action fields and business contribution. We can ensure that we only go to the next step before we are solid on the stage before. So the following stage always then builds on the previous.

The stage #1, you see here on the screen is foundation and stabilization. The key task of this stage is to ensure that the company comes to a level that we are profitable even on a conservative sales level that we see in those days. Over and above, we will prepare the company for the following transformation by making the structures ready for transformation, by developing capabilities and by setting the stage on the processes.

The second stage will be the transformation and building. This is most dedicated to establish and facilitate our new market positioning as solution provider, multiple cashing our competencies. The heart of this market position will be a consequent focused portfolio on megatrends. Megatrends are customer needs that globally drive the market growth in our plan. Two examples, we see increasing needs for safety and regulations. And we see that in the harsh environmental, we see the push for fully automated operation becomes more and more critical. And these are significant chances we will address with our portfolio.

Being a midsized company, it's important for us that we have a structure that allows us to work efficiently with such a broad portfolio on a global perspective. Therefore, we will need a decentralized organization with a clear responsibility local to local. To be then effective in working, we need a digital operating model. The digital operating model will allow us to scale the excellences and the synergies globally on one hand side. And on the other side, we will enable our regions to act local and local so that we are really addressing the local customer needs so that we can gain global market share in the regions. Already in the past, the company was working intensively on enjoying international and global market chances.

If we point out here internationalization, it will mean much more. We go now to hunt and bring in global excellences, leaders, experts into the company, taking over really global responsibility so that we participate on global excellences for R. STAHL being a Waldenburg company. The technical and excellence is key of all what I mentioned. And here, we work significantly on combining our high-quality standard products with digitalization and adding then a new excellence area we call product realization. Here, the key element is, on one hand side, technology itself and products are important for market success. But what we underestimated in the past, it's also a must that we bring the products on time, on quality, on specification to our customers globally. And to address this, we established the global value stream organization. I point it out in details later.

Having now these 2 stages in place, the third one will be then the growth and scaling. That means all key elements we have then prepared. We can then scale by a footprint extension and by further market penetration, more and more bringing our value stream to a fully automated operation. Latest, at that point, we have also the excellence to address inorganic growth. Of course, if there is a chance on our way before, we will negotiate.

I'm more than happy that we really kickstarted this program already in Q1. The teams did an amazing job to already receive key milestones and key achievements. Tobias and myself are happy to share today in the call already some highlights. First of all, we achieved final financial stabilization, which gives us the freedom to act smoothly in the credit agreements. Key elements that we realized is now a working capital management. We consequently realized quick savings also in other personnel cost spendings, and we terminated our membership in Arbeitgeberverband Sudwestmetall to be more flexible in our cost adjustments, negotiating with the workers' council here on site.

Last but not least, we adjusted the guidance for 2026, taking consideration the challenges that are out there. Having this stabilization elements in place, we could then free up our mind to work on our program NEXUS that will be a solid base for our company transformation with the key elements I shared in the slide before and with a transformation concept where we work forward on practice that we means the key element of our concept we will introduce on daily work. And we will ensure that overall, this is a transformation from us to us. That means we, together with the leadership team and all employees of R. STAHL take the responsibility to make NEXUS happen.

First and very important implementation status of NEXUS was the establishment of [indiscernible] with our social partners. And in this business, we tied in objective external institutes that negotiated and valued with us the key needs of transformation and the key action field of transformation that we got here alignment and also together with the Supervisory Board is a very important cornerstone that we achieved because this is the aligned base now for further negotiation with the workers' council and the social partners to further establish NEXUS and to realize the cost savings.

The key of our future success is that we significantly improve and bring into a future manner the way how we work, our competencies and capabilities and our leadership. And leadership means also most prominent, fast and solid decision-making. Therefore, Tobias and myself established already in the structure now 2 boards. The first one is a governance board. This is exactly the board where we handle the transformation by us, for us, as I mentioned, together with the employees of the company.

And the second board is a business execution. Here, we ensure that we get fast and market-relevant decisions to further improve our excellence and our speed to market. With the key elements in terms of board, we have then the chance to further dig in and to work out what is a streamlined corporated structure for the company. And this structure will streamline our hierarchies and our functional setting. We will significantly reduce our hierarchies, and we will ensure that the salary level is rightsized and adjusted to the work and the responsibility of each employee.

With having this concept now fully developed, we see a cost down potential by EUR 5 million in this year compared to plan and EUR 20 million by end of 2027, then continuously per year. We need here to clearly lay out that these potentials are confirmed by experts. So they are optimized there, but in subject to the negotiation with our social partners. And I'm more than happy that we are now through the phase of workers' council elections. And I'm more than happy that we will see in close period of time, strong partners to be available on the social partners that we can negotiate and shape the future of the company together.

Let me point out the value stream again. I mentioned that already but in my opinion, this is a very important cornerstone for the excellence of the company. With Stefan Lang, Senior Vice President now for Value stream, we could hire beginning of this year, a very experienced expert who is now optimizing the operation of plants globally, logistics and purchasing out of one hand with one leadership team. So from the R&D side and from the sales side, we have one single person and one single organization of contact to make product realization successfully and efficient. This team already created a forecasting team, a forecasting tool that now ensures that the value stream with each element is aligned to the market needs.

And therefore, we get a much stricter, more flexible handling of our working capital. This value stream organization will be a key element to bring down our working capital and to improve our cash reliability.

Thank you, Claus. Talking about portfolio excellence. We talked earlier about that an independent service company will be a major building block on our NEXUS way forward. And the concept for that company is written in Q1. So we are good to go there. The partner -- we have as well established a partnership to develop the first smart data kit. I was mentioning earlier that we are approaching to extend our network in order to shortcut the one or the other learning curve. And then we have the involvement of defining. So we are heavily involved to define a new automation architecture. While we are product-wise independent, that fits perfectly good in our way forward. So in quarter 4, you can expect the first innovation corners.

So talking about further internationalization. So the first international leaders are brought in our top management, that is the make or break in order to go more international and to bring as well an outside in view in our management. Then we have corporate R&D activities in between the plants in order to really internationalize more on the R&D side. And then we brought as well the first key responsibilities abroad. In that case, the commodity purchasing takes part in India. We have as well founded a new service center in Tunisia that will speed up our IT activities there, and that will first -- will be the first steps to utilize our global excellence. The digital operating model is a really essential key on our way forward, and we did a lot of work in quarter 1. So for instance, we optimize our end-to-end digitalization. We had the first IE/AI applications defined and piloted, and we improved systematically our master data because the master data will be essential for all what we do around digitalization.

We will, of course, follow up on the digital twin journey. This is a really good approach way forward. We presented at this time several spin-offs of it. So all in all, we are getting much more digital in line with our future business model. As you can see, we already had a lot of things on the plate and happened in quarter 1. And here's a quick preview what's coming next. That means that will be the major points we are working on quarter 2 and show you later on the results on those. First of all, the execution of the negotiations with the worker council will take place. The election we heard are up and running, so negotiations to resume quickly. Target is to agree and to improve finance stability and performance, which helps our company framework-wise. So make or break is that to improve our financial stability.

Talking about Sales Excellence 3.0, this is the next level of sales operation, which is mandatory in order to get more international. This has a lot to do with efficiency using AI, for instance, using more digital data connections outside in and inside out. This is as well the establishment of a so-called market management, which will connect the outside world to the inside world in order to bring the market more in the company. And we will, of course, approach additional hunting areas in untapped areas close by. And we will penetrate the much deeper the market as we did before, showing our new things coming out of our first technologies. All in all, it will help us definitely to achieve our growth targets.

So the ACR strategy update as a third outlook, this has a lot to do with the refinement of our ACR strategy. This is all about finding the right priorities and going for those, defining key action fields for growth markets and establish as well a strong internal link to those markets because we need to fulfill the promises we make at the front end in our internal supplies. This is the key in order to get more out of the market. So focus, focus, focus is the next wave for ACR.

So the important message we wanted to share with you is we kick started now NEXUS, our way into the future. And the first results are already there. And also, it's clear that a lot of challenges are still in front of us. This is not a home run. This will be hard work but also clear stating to all our stakeholders but even more important to our employees. NEXUS with the milestones, with the key action fields has all for us ready so that we together can shape the future. It will be hard work, sure. But Tobias and myself are absolutely convinced even if we see the harsh world outside with geopolitics, macroeconomic effects. With NEXUS, we have our future in our hands, and we can make it happen by hard working together and working together more efficient and more successfully than others.

Tobias and I started today to share also in this call step-by-step the results that are coming up. And also, we gave you an outlook what we are working on now in Q2. We will continue this way and also bring you with us that you share our journey in the future and can enjoy quarter-by-quarter the outcome that we generate and our proceedings on the way forward of R. STAHL into the future.

Also, we like to invite you for our annual meeting, which will take place 16th of June, and Tobias and myself will have a chance to share more details with you about the program and about the proceedings.

To frame up today's call, let's have an outlook on our guidance for 2026. With the hard work and the clear direction of our future program NEXUS. We, as R. STAHL confirm our guidance for the fiscal year 2026 as shared in the earnings call 2025, even if the geopolitics since then get worse. And that means in detail, we still go for sales between EUR 285 million to EUR 300 million. EBITDA pre, we saw already that we are good in our way. So we confirm targets between EUR 22 million and EUR 27 million. Free cash flow, this is a key area that we need to work on, especially with our value stream organization, but we confirm here that end of the year, we see a balanced cash flow -- free cash flow. Equity ratio, we go for a slight decrease.

And again, we confirm this, taking consideration the risks we see in geopolitics and general economic development. So we are at the end now of our presentation.

And Tobias and myself, we are now open for your questions.

Thanks so much, Claus and Tobias, not only for your way of looking back on the just past but also on your detailed look into the future. We do have a few questions already. In case anybody else would like to pose any additional questions, feel free to use our chat box and enter them.

Let me begin with the first couple of questions that are looking back, starting with the top line, there was one question regarding your growth that you've seen in Asia. At some point, you mentioned that they were onetime projects in Asia. Can you be more specific? And do you expect more projects in Asia to come in this growth rate to continue going forward?

So the project we've been referring to was mainly that UPS job, what we presented last year that was booked in '25 and executed mainly in '26, early '26, as shown. And this is generally a good indication on the change we will have in Asia. So we've been there really mainly opportunistic in order to learn the market, in order to get a kind of idea on the landscape and on the heat map. And now we do that tactic, strategic and step-by-step in order to get more business out of those markets.

On the other hand, America was doing -- or the Americas were doing a little more on the soft side. What are you doing to turn this around and to maybe increase momentum there again?

Yes. You're right. We see that U.S., also saying North America is softening. And the challenge is here geopolitics. So we have still a value chain that is coming from Europe, we're importing to America, and then we're just finishing our goods that is the current status. And with the new organization, I mentioned the value stream organization, we are working on optimizing this value stream. That means bringing more value adding local to local. And by doing so, we are then not longer have the challenge of this taxes that are there, and we are much faster in the execution to customer, which is a significant competition aspect in U.S.

Let's move further down in the P&L for the first quarter. Looking at your profitability, EBITDA before special items improved quite significantly from 5% to 9.2% in the first quarter. Main driver here were lower material expenses and personnel reductions. How much of this improvement would you rate as structural rather than temporary?

What we see so far is structural, but it's, as I mentioned, an outcome of the cost-cutting program 2025. So it's structural on the personnel level, what was not addressed in 2025 is really, let's say, also working on the organization itself. So to make a move forward to leaner organization and to streamline the hierarchies. And this is something we address now within NEXUS, and this is something, as I mentioned, where we see huge potential to increase efficiency. But taking in consideration that this is a major step, this will also need intensive negotiations with our social partners.

Thank you. Let's continue with the EBITDA. The EBITDA before special items and the reported EBITDA, the difference between those 2 was rather small in the first quarter at only EUR 0.3 million. Should we assume that special items will remain limited over the coming quarters? Or should we expect higher restructuring on the NEXUS related costs in the fiscal year?

This most likely depends how we can work on our personnel cost structure. moving forward and especially how fast we can move forward in the negotiation with our social partners. This is the key element there.

And another question that kind of addresses the same issue. If the gap between pre-special items and post special items remains rather small, one person was wondering if it makes sense to disrupt the special items, EBITDA, the EBITDA pre. But I guess that's something that you can consider going forward.

I have one more question. And before I get to this to everybody who's attending this call, if you have questions, please feel more than welcome to enter them into the chat. We do have some more time to address additional questions.

The last question that I presently have is you aim to increase your international footprint and technical expertise. what end markets technologies are you targeting specifically? And regarding your -- and you've already talked a little bit about the sales offensive in Europe, Central Europe and Asia, but maybe you can elaborate a little bit more in depth going forward.

Tobias and myself aligned in our work on Nexus that we need to be focused in our internationalization. We are still a small company. There are huge potential on the market and our side, no doubt. But to be successful in terms of effectiveness and efficiency, we aligned together that we really need focus. And there, we said the most promising region from market perspective but also from our today's position is Asia. And therefore, also, we announced already that we now continue to build a new plant in India, which will be the hub for Asia.

And we're then now sitting with the team and Tobias will give you more details with the team to work on a next-level Asia strategy that we will bring up in one of the next calls. But what I said will not mean that the rest of the world, we take out of our scope. We will especially also work in North America to, let's say, increase our local to local footprint and also to come here to a very focused growth strategy. But relating to the questions about priority, international Asia first, and second step will be you U.S. by [indiscernible] approach, and Tobias will give more details.

Yes. So basically, we mentioned that earlier, it's about how we position ourselves on the markets. And there, we're talking roughly, and this is not black and white, 2 verticals. The one is more the infrastructure related. And there, we will present ourselves as a one-stop shop. That means you can get everything around explosion -- electrical explosion protection, including services, as we mentioned before. And the other pillar, the other vertical is then more the process-related one where we can highly differentiate, where we have our solution competence in the back and stuff like that. And those positions, we will place on the hotspots we are approaching in Asia.

Thank you so much. I do have one more question, which is focusing on NEXUS and the focus on efficiency and operational performance. If you were an investor, which concrete KPIs would you track over the next 2 or 4 quarters to assess whether Nexus is working, especially regarding working capital, free cash flow and order conversion?

I would recommend we need to follow up on the working capital so that we see here the improvement that we announced here, especially in the area of bringing, let's say, our stocks down. So with the measures we have in place, we need to be much better in those. This would be number one. And secondly, we, of course, need to see that the improvements we saw so far in EBITDA pre continues to go all the way up. So we know that the improvements we see in the moment are to a significant part driven by the measures already decided 2025. Now we need to show that with the NEXUS, EBITDA pre is also fueled by Nexus. So questions, recommendation to investor, I would have a focus on 2 EBITDA pre and working capital.

Thank you so much. I see that somebody is still typing. There might be an additional question coming up. I'll just bear with you for one second and see if we're going to answer that.

In Q1, the book-to-bill ratio was slightly above 1 order intake, EUR 77 million; sales, EUR 73 million. How confident are you that this positive momentum can be sustained through 2026? And where do you see the full year ratio setting?

So talking about the order intake, we are confident looking at the pipeline. So this is robust. Of course, on the short term, that is in relation to the uncertainty in the geopolitics and in the markets. But from that point of view, the second quarter, I'm positive there. And the sales is always running behind so far at the end of the day, the same conclusion there.

Thank you. I think this was the last question. At least I don't see any additional ones.

Wait a second, dramatic entrance. There is one more question, which reads, do you also expect special opportunities in the Middle East in the reconstruction of oil and LNG infrastructure?

Yes, we do. There is -- will be some MRO business coming up shortly. This is always the flip side of such crisis, nobody wants, but we will definitely have there some MRO business we can address approach and convert into orders.

Great. I think we're done with the questions. Only thing left for me to say -- next to the final remarks is thanks a lot to you, Claus and Tobias for the deep insights that you've shared with us. Thanks to everybody who joined this call and asked very interesting questions.

You will find a recording of this call, as previously mentioned later today on the IR page of R. STAHL and also on Research Hub. We will also send you a brief questionnaire, which we would love for you to fill out so that we can give feedback on this call. To the company, if you have any additional questions, please feel free to reach out to the IR department of R. STAHL or also to our analysts. And before we end this call, I do have to show a few more slides that are in the appendix of this presentation. So in case you look at it later, you can find additional insights. And please pay close attention to the disclaimer on Page 31.

Thank you so much to everybody who joined, and have a great day. Thank you.

Great day. Thank you for your attention.

Thank you very much. Bye-bye.

Good morning, ladies and gentlemen. Welcome to the R. STAHL earnings call for the fiscal year 2025. The results will be presented by the CEO, Dr. Claus Bischoff; and the Chief Commercial Officer, Tobias Popp.

[Operator Instructions]. Please also note that the earnings call will be recorded, and you will find the recording later today on R. STAHL's web page in the IR section and on Research Hub. We are covering R. STAHL and our supplier linked to our comprehensive research in the chat box as well in a few moments. Please also pay attention to the disclaimer on Page 2 of this presentation. Thanks again for joining, everybody, and I will now hand it over to Claus and Tobias.

Gentlemen, the floor is yours. Good morning also from our side, ladies and gentlemen, and a warm welcome to our 2025 earnings and investor call. My colleague, Tobias Popp, and myself will quickly walk you through our 2025 results, so that we have sufficient time to talk about our new strategy in our future program, [ Nexus ].

So starting with an overview of 2025. We had a very good first quarter. But then over the year, it becomes more challenging, mainly caused by economic and geopolitical uncertainties, but also from challenges we had internally. Overall, we saw that to a strong finish in the fourth quarter, we could limit our drop in sales and order intake roughly by 9% to 10%. The EBITDA, we could even help on last year level due to temporary positive one-timers, especially in our fourth quarter. The free cash flow, nevertheless, dropped down deeply and came to the breakeven point, mainly caused by an increase of working capital and we could not adjust it to a sales stop. Net profit, we came out around EUR 3 million.

Now going more in the details of our financials. First, top line KPI. We see overall high in our sales in 2024, and our results 2025, around EUR 313 million. This is roughly except the average if we are looking on all these 4 years. On order intake, we see, unfortunately, now third tier in a row a decrease on order intake and also on order backlog and especially, we see the deep decrease 2024, where we eaten up our order backlog for the 2024 sales.

As I mentioned already, key reasons for the decrease in top line are externally driven, but also we need to take in consideration that we significantly have to work on our market position and competitiveness because we have to take also in consideration that the future markets might be even more challenging than today.

Switching over to bottom line KPI. We see that since 2023, we have a really solid EBITDA premier. We could continue this also in 2025. As I mentioned already, this is around EUR 34 million, which is equal roughly to 11% margin. Also, if we are looking on the net debt side, we see an increase to roughly the EUR 35 million. But if we take this in consideration also in relation to EBITDA, we are still on a solid level.

Where we definitely have to work is on our free cash flow performance. If we ignore the one-timer of 2024, where we had positive effects in reducing our working capital out of the [ corner ] time. We see that overall for years, we are not significantly positively, and this, of course, is not acceptable if we are looking into a solid way on the future. So this will be a key action point we need to work on in the future.

Key data of income statement. We see that we are coming really from a good material ratio level. But we see also that we could not compensate the drop in sales, 100%, so we ended up by EUR 110 million in cost of materials. We need to take in consideration that this includes onetime effects, but anyhow, in terms of flexibilization of our costs in the future, we need to work.

On the personnel cost, we are traditional on a high level. We see here that even in 2025, we increased -- we need to take in consideration here that the increase is mainly driven by severance, costs caused by our personnel cutoffs. But anyhow, this will be a working field for the future. On the other operating expenses, we see we could work -- we ended up at EUR 63.7 million. Also here, we need to take in consideration, we had onetime expenses of EUR 3.6 million. So if we balance this, then we can say on the other operating expenses, we were able to flexibilize our costs.

Overall, the EBIT then decreases reasonably to the point I mentioned before, to EUR 6.6 million. We worked then very intensively on our duties so that we ended up on EBT on the breakeven point. Taking in consideration that deal taxes helps us a bit here on this point. We ended up on a net profit on EUR 3 million. And I mentioned already that if we, let's say, eliminate all the onetimers before, you see that the EBITDA level is very constant at 11%, what is, from my perspective, really good news from this income statement.

Moving now over to the cash flow, key data, we see that the net profit, as I mentioned, already came down to EUR 3 million. So we have been a decrease also in the cash flow to EUR 90 million, what is not only used primarily by the net profit but also by the related noncash items.

The changes in working capital I pointed already out. This is not an adjustment mainly on the material side. And we see then that the operating activities due to invest. We keep on the same level so that all in all, the free cash flow ended up and breakeven. To compensate the missing free cash flow, we need to use our debt so that the net debt increased to roughly EUR 35 million.

Having this said, I'd like to hand over to my colleague to Tobias, who will now guide you through the regional aspects of our top line.

Yes. Thank you, Claus. Talking about the regions. The sales decrease by an average 9.1% is in a nutshell mainly driven by significant less global investments over the year. When we look about the different regions in Germany, where we had a decline of 10.2%, that was, for instance, nearly no investment behavior in the chemical industry.

When you look at the central region, which was declining by 6.3%, basically okay, but the major projects have been missing completely. When we look at Americas with minus 13.9%. That was mainly driven by the pressure on oil price over 2025, which has significantly slowed down the investments in oil and gas there.

When we look at Asia Pacific, it's a slightly different situation there. It's a heterogeneous scenario, while India, for instance, I'm talking about a pharmaceutical behavior, was performing quite good. We had, for instance, in Korea, nearly no relevant export business in place.

Talking about coming slightly over to the strategy, I would like first to discuss about the market potential in general. When we look at our scope of electrical explosion protection, we are facing that against the potential in the market of roughly USD 10 billion. This USD 10 billion contains the IC, the [ NEC ] and of course, the harsh portion we are facing. And of course, it's segmentated in Asia, Americas and Europe.

And when we now scale it up in the direction of 2030, we foreseen there a development of EUR 13 million to EUR 15 million what lands in an average growth rate of 6% -- 6% to 9%, but we will be faced there as well with extended global competition. That means it will be much more defragmented as it is today. Nevertheless, we see us quite good position in that environment and look really forward to get more out of this potential.

Talking about our outperforming market position, you see at the right bottom where STAHL is as of today. At the left, we positioned some of the competition there, what we see mainly positioned on the quadrant one. While you have on the X axis, the customization on the Y axis, the solution and technology capability, our journey will be on the way to get a bit of complexity out and in parallel, driving our technology and solution business forward, and that will give us a unique position at the end of the strategic journey.

As Tobias pointed out, we have a growing market in front of us, and this is really the good news. The key question is how we, as R. STAHL can participate from this market group. Taking in consideration that we have significant knowledge in explosion protection, we need to find a way how we cash this out in a broader way and to bring us in a position that we can participate on the global growth.

Overall, this will end up in a position as a global leader for solutions in explosion protection and harsh environment. That's a huge step for us as R. STAHL and the key question is what do we need for this step. Of course, as Tobias as shown, there will be significant competition. Therefore, the key element for us is really to have a solid, outperforming market position. This market position must be fueled by a technology-driven portfolio.

We need a structure that helps us as a midsized company to act really [indiscernible] and to handle this portfolio. At the end, we need capabilities and innovative work styles to shape it as a company. All what I had said need a solid fundament. It means before we are talking about our way into the future, we need to ensure that our foundation today is solid. And therefore, before we go into the future, we need to work on our financial stability and on our operative performance.

All the actions and elements I pointed out will be framed until 2030 with our future program NEXUS. Taking in consideration the sophisticated elements in the broad context we are talking about, we decided not to have a big bank transformation. We will address this in a step-wise approach. And for Tobias and myself, it's important that is an inside-out activity so that this transformation is really driven by our employees. Of course, we will tie in certain experts to the porters.

Let us dig together a bit deeper into future program NEXUS. As I pointed out already, we have a stepwise approach. We see 3 main phases. Phase #1 is foundation and stabilization, more or less setting the stage. The key phase is Phase 2 transformation in building. It will start already in 2026, but fully results will be available around 2027, '28. Here, we establish and enable our market position as a solution provider.

The third phase will be then the further growth and scaling phase where we especially globally further grow and fully execute a scalable value stream. In this today's call, I only want to go shortly in Phase #1, which is already in execution. We work here together with our external partner, [ Alvares Marsal ], and our social partners to reduce the personnel costs, we saw already in this call that we have here a high level still. And thus, we need to structurally bring down.

Second point is that we will streamline the organization and the structure of the company and establishing here in the company capabilities to act future-orientated and to handle this transformation from the company inside organization. All of this will be executed in a, let's say, unfriendly world outside. I pointed out already the challenges from the market. So we are quite [indiscernible] in our sales planning here to keep it stable. But definitely, this first phase will address our net debt ratio and EBITDA pre margin.

Phase number two, transforming and building. As I mentioned, this is already the key element of the transformation and -- the North Star of transformation is our outperforming market positioning. This market positioning follows the mega trends that drive the market growth that Tobias pointed out.

Overall, we see 4 megatrends. Megatrends #1 is that the needs and the requirements for safe and secure operation increase dramatically all over the world. Secondly, we see a high requirement for efficiency, the value of digital data and the cost pressures being also a lot of challenges to the OEMs and the operators of our industries. And here, we have a significant chance to grow.

The third point is we see all over the world that the goodness to work is reducing. And especially if we talk about half environmental and unsecured environmental, this is even more dramatic. So we see in all our industry a strong move into automatic and autonomous operation, which is a third megatrend and is a megatrend that will fuel our market position.

Last but not least, we have the need for resilience and sustainability. If we sum all these 4 megatrends, the question is how we can build our market position in this frame of mega trends and here, from my perspective, this is important that we start at the core of our capabilities. So you see here already on this slide, if we move forward in the outperforming market position.

We start with our existing corporate tool. And we are already working intensively in streaming lining it and adding innovation on this portfolio. Two key areas I put here with us, these are new materials and functional integration of the components because if we can integrate the function, reduce interfaces, which are always challenges for quality, resilience and costs.

Based on this extended core portfolio, we will then at extended automation portfolio. One key element in this sustained portfolio is the smart data. Smart data means we are getting more and more in the digital world. and the mass of data overwhelms our customers. We are at connecting area between, let's say, the operational product and the control level, I come to this later, which gives us really a pole position to enter the smart data functionality to address new products and digital features.

Based on that, we will then move forward to connect different products to connect different functionalities to solutions. This will be for our customers and for the operators. There's a significant benefit because he can then come directly to us as a one-shop provider for solutions in harsh environment and explosion protection. This will be very important in the growing market because I mentioned with the megatrends, complexity of safety secure needs will increase. And for our customers and the operator, this area is not the key competence, but it's an area that is of high risk to his business. And therefore, we see here a major cornerstone for our growth that we can support end customers and operators here with a one-shop stop.

The fourth step will be then the internal international scaling of our product, but also our competence. A significant point will hear be that we are working intensively on growing a global partnership network. I'll come to this later. And this partner network will help us to enter new markets and will help us also to extend our competencies and our portfolio.

The fifth and last cornerstone in our new market position will be independent service company. Already today, we offer with our product service and support, but what we mean here is a complete different approach. It means really supporting the customer over the life cycle, it's a complete life cycle with capabilities and with a dedicated overall service from [indiscernible]. That means from planning over ordering over components to execution and also, let's say, maintaining and replacing.

These are the 5 cornerstones of our new market position. And one key element of this new market position is that this high level give us a chance to multiple cashing out our expert knowledge. It is coming from the core portfolio, but now it's really, let's say, stretched over the entire life cycle through extended automation portfolio, a solution providing internationalization and service companies that is rounding up all over the life cycle.

As you see here, this will be a market position that is very sophisticated, especially taking into consideration that we are acting here in a global content. This is a huge challenge for a company like us because we are a midsized company with, let's say, its limitations in, let's say, core structures and core capabilities. Therefore, one very important cornerstone for this success is that we established a structure that helps us with our, let's say, midsized structures to expand globally and to handle the sophisticated portfolio.

The structure will be a decentralized network. In this decentralized network, the headquarter, which is here in the center, dark blue, is moving in a direction of the governance fund. It means here, we are giving the strategy guidance, and we are ensuring by governance set scaling of synergies and accidents are implemented and executed. Based on this frame, and acting fully free in this frame, we then establishing independent local to local hubs. Independent means they really handle their P&L responsibility independently, and they are independently also responsible for business execution as long as they stay in the governance frame.

And then you see here, we have, let's say, modularization on the hubs. We have a full-blown organization with value stream with manufacturing with sales, we call local to local full-size hub. And we have also reduced variance we call [ Sales Hub ] where we most likely have on a P&L responsible sales execution. But also here, completely independent responsibility for execution and customer interfaces.

As I mentioned already, we are going for a full-sized digital service company, and this decentralized structure gives us also the freedom that we can integrate a fully independent company in our ecosystem here by defined interfaces. Beyond these interfaces, the digital service company will have the freedom to act on own governance, on own structures, own processes and capabilities. So that 100% is ensured that we have a dedicated execution to service from our understanding is a key matter of success.

Last but not least, this decentralized organization with us also enable to integrate global partners. As I pointed out, a key element of our new market position. And the key element is that we are here really global that we tie in all over the world, key competencies, key capabilities to fuel our market position.

As you see here on the dark blue arrows, a decentralized organization like this needs a very strong communication backbone that enables to handle this globally as a midsized company. And here, we developed our already established digital processes like SAP like PLM to a full-sized digital operating model. So that worldwide, the scaling and the government is deployed not by people talking to each other. It will be employed by a PLM system, where the governance is 100% digital and intrinsic and in SAP, it ensures that worldwide cash to order execution is 100% in line.

I hand now over to Tobias, who will give us more insight about this digital operating model.

Thank you, Claus. You already set the scene for the digital operating model. I would like to share some insights with you. What -- I would say we already achieved a quite good level of end-to-end digitalization in the main value stream. So the one task will be, of course, to bring that to the next level of operations by doing some well-selected extensions. So for instance, bringing SAP from [ R3 to S/4HANA ] and stuff like that, for instance, to bring the web shop with [indiscernible] to enrich the web shop with additional functionalities like having an online configurator as part of it, but there will be as well some more elements, some new elements in that landscape.

So you see at the left, for instance, the AI-driven part, which is mainly foreseen in the first wave at the front end that will allow us to really [indiscernible] closer to the customer needs in matter of providing their much better performance, much better reaction times and much better prequalification on demands from the market.

On the top, you see what Claus already mentioned, the PLM, that means the product life cycle management which is then the chance that we can really couple our basic R&D activities to things like local to local hubs that we mentioned before. So that will be really a huge enabler in order to support our internationalization. That will be our journey with the first wave. And of course, this is not the end. There will be much more of such models. There will be much more AI in the future but we will start with that scenario first.

We heard a lot about the [ organizatorical ] things, and we heard a lot about the local to local hubs. You see here the 2 main ones, which will be enlarged accordingly. So first of all, at the left Americas. And secondly, at the right, this is then our Asian hub in India. And they will have all the functionalities needed in order to provide a proper backup for the, let's say, front end, mean sales, in order to fulfill the promises we make there and in order to provide a second level when it goes then deeper in technology as we heard before.

In addition to those hubs, which will be enriched and empowered accordingly, we will build up as well a business service center and that business service center, which is foreseen in tune will provide us then different options in order to be quicker at the one or the other task we need to drive on our digital journey and on our performance journey. So it will definitely start with the digital side. That means software-based activities there in order to really speed up our AI activities and fulfill our application store with the necessary content.

That's to say about the internationalization, the hub structure. So Claus, I would like to go back to you.

Thank you, Tobias. After the journey of Tobias around the digital operating model and the organization. I invite you to have a stop buy with us on, let's say, 3 highlights of the technology-driven portfolio.

In last year's call, we introduced to you our automation portfolio, which is exactly the interface between control center, production operations and which handles the communication between the utility and analog. The company was really successful to implement, let's say, infrastructure on a communication side with our field switches and [indiscernible].

And exactly this product line brings us in a [indiscernible] position because as you see here, we are in the center of the communication. That means we are in the center of data. The challenge is only we need now application competence left or right, so that we can work with the data. And this is exactly the way we are now started to work on to extend our automation that with partners we extend our knowledge left and right with the application and competencies. And by doing so, we can then build on the base of communication new electric products that ensure safe operation, respective functions dedicated to hazard areas.

As you see here, we are already in there, but we will extend this with our partners also to the field level and what is very important in the new world in a feedback level, that will, let's say, in a digital world, given status of the processes so that they can be optimized. The max level will be the smart operations in the processes. That means with this feedback loop, now our customers and the operators has a chance in real time, optimizing the process.

You remember what I mentioned, mega trend of efficiency and effectivity, this is exactly the cornerstone, which stresses this needs because now we can even complex systems like ships like chemical facilities can be optimized overall with this feedback. The Asset Management brings this on the next level, because with knowing the data, smart data. That means not raw data, smart data means raw data that is connected with the knowledge of the application, give us a chance, especially with AI tools to learn.

So if we see a certain behavior of the data, in the past, we can predict what will be the future and also ensure that maintenance and diagnostics helps our customers. There will be a significant benefit to reduce downtimes and very important to avoid risks that might cause it damage.

At the highest level, we talk about [ AutomaSolutions ]. That means execution operation, all autonomous without human beings, and this will be a very important stage that sums up all and this comes also along with the functional integration. Let me show you one example for this solution integration.

The next generation we are working on is a control cube. Control [ group ] is, let's say, extension of our existing UPS that we have in our portfolio that we also deliver to offer applications where you integrate, you can say, all control, all key components that you can buy [indiscernible]. But now we are adding in all this world, you see it on the left side, the new features of automization and extended uses of smart data.

What's important is all these controls will be implemented in critical and half environmental. So there will be also the question, how can we ensure a continuous operation even if we have uncertainties in power supply. And therefore, we are working with partners on new better technologies, resilient per air and sustainable battery technologies. And we will integrate also here infrastructure and products from our partner.

So that is really then for the application you see in the top one shop stop. One last comment, the harsh environment, we see a huge potential in critical infrastructure. You all see from news that with a crisis from Iran, the critical infrastructure becomes more and more focused and this will be a significant good field for us. To make this happen, and this is something I really like to point out this passion in this call. We need to have in mind we need smart manufacturing. And having smart manufacturing, smart value is on the same importance level as a competence on the product side to bring it to a market success.

Last cornerstone, only short, the service company. Here, I'm happy to share with you, we are working already very intensively on setting up this new company, and we are bringing here together best of 3 words. Number one, we are bringing in knowledge and experts from R. STAHL also including the reputation of the brand. Second, we are working here really on a complete new company with a dedicated service structure. And third, I'm happy that we are working with a start-up company out of [indiscernible] that has a lot of knowledge of digitalization and scaling dedicated service in industry. I'm absolutely convinced that this will be really a big step forward for the company.

And what's also important, out of this service providing, we will learn a lot about environmental and the use cases of the end user. And this will also then fuel again our product components because -- as I mentioned, we learned about application about environmental and can fuel our product.

This would be for today an overview about, let's say, Phase 2. Phase 3 will start in 2028. This will be the further growth in scaling. Very important is here that we expand the footprint, especially in Asia and America. And increase our market penetration. Key element for this is that we work on a fully automated value stream based on the digital operating model, but also, let's say, with a higher automation degree on the manufacturing.

The chance we are always looking on is inorganic growth. It's here, let's say, a [indiscernible] 2030, might become also earlier. Let's see what opportunities out there. Overall, the first -- the third step will lead us in to the level I announced, we assume that we can come here in the level of EUR 500 million above and honestly saying, this is also my perspective, we will need this size so that we can work really on a proper global level.

With having this said, I'd like to come back at the end of today's presentation, again from 2030 to the outlook of 2026. Talking back in the coordinating system of NEXUS 2026 is a time of stabilization and foundation. Since you see also on the guidance for 2026, so we are quite conservative on the sales forecast. We see around EUR 285 million to EUR 300 million, also taking into consideration here the challenging geopolitical situation out there.

What I mentioned already, EBITDA pre, but even more the free cash flow will be something we have targeted, and we are working on. The key point is, as I mentioned, this will be something we need to work on also with the social partners. So this is nothing where we expect that we have a big impact already in solutions in 2026, but we will see the impact more upcoming in 2027.

So let me summarize today's call. We started with an overview about our financial performance. We then guided you through our future program NEXUS that and Tobias and myself are absolutely sure will bring us on the next level, especially because it's a program we set up to be executed from us to us. And hopefully, we could also share with you and bring you in the picture today that is a program that will address all elements that's needed for success, including the outperforming marketing position, technology-driven portfolio organization, decentralized network this digital operating model and key competencies, including also a full-blown service company that ensures that we can participate the market growth that is in front of us.

But I also like to say all this content we shared is nothing than an investor call presentation. If not, we succeed that the key shareholders of the company, the Board of Directors, we as Managing Board, the leadership team, employees and our key partners work together, stronger and more successful than our competitors. Because this working together, staying together and let's say, executing together with and these capabilities is in Tobias and my picture, the only way how we can ensure that all the slides that had been shown today could be brought to life.

I'm more than happy that we can continue our conversation that started I came out or Tobias and I came out on directors, meeting Board of Director meetings this week and also a good conversation with share stakeholders last week. They were very promising. And I'm looking forward together with Tobias to continue this journey. And now I stop talking and hand over to the Q&A session.

[indiscernible] back, but especially for the look forward that is supplied as within the insights you shared. We do have a lot of questions, so I will jump right into it.

The first question is regarding the international expansion. And the question is regarding the past and the future because it says that International expansion is such as nothing new as a topic for you. You've mentioned that previously in the previous years. What things have changed now that makes it different from the growth that you had supposedly envisioned in the past in the internationalization versus the growth that you can show now? And what structural changes are in place that ensure that the execution will be sustainable going forward? You've touched on that partially during your presentation, but maybe you can wrap it up in a few sentences.

A really good one. Let me start with the people and the first thing that Tobias and I changed that we brought international colleagues on the first leadership there. So that we really can ensure that thinking and acting in this company begins to be international. This is the first big change.

The second point is that with the new structure and the new government, we really ensure that responsibility is on the shareholders on the local organizations, yes. In my opinion, and this is a question in all the industry, we need to learn and let's say, to accept that the world is not longer following German rules of following, let's say, German perspective. We need to be more humble also as a company here and [ relay ] on our international colleagues, support our international colleagues that we really come to a local to local.

This is, in my opinion, really important cornerstone is local import for responsibility, but also execution. And last point, we will establish a global partnership network that ensures that we are connected globally and smart network is on the competent side, but also on the execution.

Thank you very much. A big almost pivotal point of your strategy going forward are partners that you are looking for or maybe already have some of them secured. The question is regarding, can you give a few examples for a potential partner that you are looking for or maybe already have on your radar screen? And are you currently working with partners in certain areas? And what are your experiences with those partners?

And the other question, which kind of ties in with that, what -- describe what kind of partners you're looking for on a global scale?

Let me point out 2 examples for a partnership. We are working on the service side, with a startup company coming out of the ecosystem of [indiscernible], it's called my technical service. This is a very young company that is focusing on service, dedicated 100% to industrial applications. And what I feel very important is that we succeeded to connect this company via this network concept with key experts for a long time as the key experts of the company. So we could, as I mentioned, bring here together, let's say, the 2 good things of different worlds. This is one good example.

Second good example is a company [ high tech ]. [ Hi-tech ] is a company, solution provider, more focused on automation on a fabric automation perspective. But they have really good ideas for retrofitting established processes and facilities. And our teams are working in a moment together on a solution to transfer with competence or to combine better saying competencies with the competencies of R. STAHL in explosive protection so that we can support, especially in Europe, our customers with a retrofit of analog facilities into the digital world. I'm happy that we can also, let's say, smaller at this point of time that we go for having the solution to be shown together on the SPS this year in [indiscernible].

Thank you. Let me continue with NEXUS. And you've elaborated on that in quite some depth looking at the EUR 500 million that you might potentially have in revenues in 2030. There were a lot of initiatives that you were talking about things that you need to change within your organization and new things that you have to form. Do you think that you might need additional funding for that? And the question reads, do you need fresh money for the NEXUS transformation? And also in that same context, maybe you could give us an overview of what measures you've already implemented so far as part of the NEXUS program.

That was quite a broad question, complex. Yes, let me start with your last part first. I'm happy that we are already on a good execution status in the foundation and stabilization perspective. We're working here with the partner [ IRS Marsal ] and the [ social ] partners. We shared today this week with the Board of Directors that we are now through, let's say, with the concept of a streamlined structure that will make us more agile that make us faster. And we will be happy that we can implement this fully within this year.

Secondly, I can say that we implemented, especially here in the company, 2 key elements, we call business and governance board. These are, let's say, market places where we insured past and cross-functional global decisions. You can just make your perspective Tobias and myself once a week, we are sitting or 3 hours in a meeting, and we are there just to make decisions or to listen to escalations.

So that we, let's say, ensure that globally, decisions are made fast and diseases are made fast in a way that we do in sophisticated decisions, connecting all perspectives of the company. The last example is, I point this already out. We have introduced global leaders with certain key positions. For example, the global response portfolio is already, let's say, a non-German, [ no reason ] colleague, from the market side, we have for market management, the global leader, it's an Indian person.

And the last point, for example, global commodity management for mechanics, global, the full global responsibility already enhanced to the [indiscernible] and it shows also, let's say, that we significantly make steps forward in the international.

To the point of investment, of course, you can imagine with the point I made in building up a fully digital operating model, bringing our portfolio on the next level to be really technology-driven, be 100% automatic and autonomous ready. This will be a significant step that, of course, will especially also on the manufacturing side will meet investments.

It's too early to talk about because it's important that we have a clear picture what we are talking about in terms of volume, but also on timing. But this will be a next step that we need to finalize around, let's say, today this year annual meeting.

Thank you for that. Looking at the market overall and your key asset to customers, the question is regarding customer loyalty and steps that you have undertaken to secure and expand on that. And it reads unfavorable market conditions are only one side of the coin. What specific steps has management taken to strengthen customer focus and customer loyalty, thereby laying the groundwork for future profitable growth?

Yes. Thank you for that question. I can -- we already raised it up mentioning the so-called business Board because the business Board will be then, let's say, the center where we bring the business means the customer in the company. So that will have, of course, 2 directions: the outside in, which is then, let's say, what the market needs from the company. And the inside out is then things like technology push and so on. That means what is where we can differentiate what is the things we would like to talk with the markets about? And this business board will be then the point where we bring the business together with the company in a structured, organized way and that will help a lot in order to bring as well markets in the company, which are not seen on the surface right now.

I have a follow-up question regarding the capital raise in relation with the NEXUS growth initiative. It focuses on leasing obligations and cash flow. It says leasing obligations have increased by roughly 22%, while the cash flow has dropped from EUR 50 million to roughly breakeven. What consequences does the company need to draw from this? And what is your view on the long-standing demand from external shareholders that R. STAHL must strengthen its equity base?

As I pointed out when we talked about the cash flow, and it's not only the cash flow, it's the entire bottom line, we need to adjust structures that we are better in working on drops or peaks in the market scenario because we all learned from the past that, let's say, the uncertainty and the instability in the market is the new normal. And what you can see in our 2025 results, there was a lot the company did. It was really good performance in adjusting, but the structures of the company were not allowing the employees to do the work we need to flexibilize in the extension and in the time that we needed to bring the cost down. And this is definitely something we need to work on.

I mentioned already, with [ IRS Marsal ], we made significant work to streamline the organization, to streamline also the decision processes so that we, first of all, become more agility. So the capability to [indiscernible]. Any things that will be in discussion also with the social partners that we find a way that we can also more flexibilize our costs.

Okay. Another follow-up question to the rights. Potential rights issue would be looking at sales beyond EUR 500 million or at EUR 500 million in 2030 and talking about inorganic growth on the one hand and lowering net debt, on the other hand, that seems to be slightly contradicting on the one hand, dishing cash out to acquire something externally and on the other hand, having net debt being lowered. Do you think that you can convince the main shareholder to accept a reduction in the shareholding, which probably means also a dilution if you do a rights issue?

Let me phrase my answer in that way. The first thing in today's call is only the starting point. We need to work intensively and this is, first of all, the job of Tobias and myself, but then also more as all the other stakeholders that we let's say, aligned together on this NEXUS program, so that we all have a common picture, what is it? And we have a buy-in that this is the right way for A. And this is in place, then the next step is how we bring it on the road. And these are, let's say, all the questions that you wrote in after that is then falling in place.

That is in the question, how do we finance it? And how can we align with shareholders? Let's say, on the same page in terms of content, but also on the same page on the port.

Thank you. Talking about one-offs in 2025, you mentioned, if I recall correctly, EUR 5 million for severance and million other operating expenses. Can you be a little bit more specific as to how these are composed? What part goes in there?

There's no good English transformation for this word. This is an employee capital program that was decided and executed in 2025. This was addressing roughly 80 people, and we have costs in the onetime for, let's say, transfer [indiscernible] itself, but also for the several let's say, one example.

Thank you. Talking about 2030 and NEXUS and EUR 500 million in revenues. Do you already have an idea of what your margin expectation on the EBITDA level would be EBITDA pre for 2030?

Let me talk about, let's say, the EBITDA level and margin level, let's say, a bit easier, let's say, also recalibrate this with the entire, let's say, point I think on 2030, when we have the portfolio in place when we have the new organization in place, and we have been really a fully digital operating model our target must be clear to come to a double-digit margin based on EBITDA.

Thank you. Let's stay with EBITDA for a second and look at the EBITDA outlook. Which cost category or cost categories do you see as having the greatest potential for savings? And how do you expect personnel costs to develop now that you have a reduced head count and without onetime expenses in 2026 such as [indiscernible] payments?

When we talk about, let's say, the financial figures, we saw that still our biggest portion is personnel costs. And this is something we need to work structural-wise on this. We placed already last year cutoff program, and we are now at a point where you where we need to work on this on a structural means it's not a question of, let's say, pure cutoff. Head count is something where we need to streamline the structure of the company to improve our operated performance, to use digital tools.

And one thing that we also need to use more it is a global footprint. And Tobias [indiscernible] internationalization landscape, you saw already, we are working now on [ Best-Cost Country ] locations. We have started to build a new factory in India. As I mentioned, we are moving over the global responsibility for commodity buying mechanicals into the India area, and we are working to build a service center internal service center, so for administrative services, Indonesia.

Now this is our approach where we work in the most important point that is, let's say, reducing the personnel costs, but allow me here also to add -- and to make clear, if Tobias and I, we are talking about reducing the personnel costs, it's not a matter of exclusively laying off people. This aspect of personnel costs is quite a soft one. And the situation we are in Germany, we need to work on the entire aspects.

That means we need to work on a flexibilization of the cost that we are becoming here better and one point is also on flexibilization of payments so that if things are challenging, we can also participate in, let's say, reducing salary level. On the other side, if things are going good, of course, we can also ensure that employees participate in the probable. And this is something overall, where I can say we are in good discussions with the old partners, but still they are ongoing, so we cannot share more on today's call.

Let's stay with that topic just a little more. You already talked about the tariff partner shaft. And the question is reading how did employees react to the companies withdraw from the investment of the tarriff partner shaft?

Change process. We do a lot of communications these days. We try to bring a lot of people in the strategy framework, what we explained before in order to explain why we are doing what and that turns off more and more that we get multiplicators in the team as well.

I don't even know if you separate this out, but one question is regarding the harsh environment market segment, and it reads what potential in terms of revenues and earnings do you see in the harsh environment market segment?

The magic thing is to keep focused. So we did a lot of pilots in the last couple of months. We presented the one or the other in that format. For instance, the UPS we did, for instance, the nuclear power plant we did and those things will pay significantly in that future basket. But as said, it's -- we need to keep focused because we cannot be everything for everybody because there is a huge commodity market in the harsh environment but there is as well a nice niche for us where we can do a lot of business with. If it's things like those ones or others talking about offshore wind parks and stuff like that, there's a lot of -- there's a lot of nice things where the capability of STAHL can provide an added value to.

Looking at NEXUS in one of your slides, you actually showed the market growth on the one hand, but you said that competition within that market is most likely going to increase. And the viewer is asking what will you do to differentiate R. STAHL in the market to guarantee increased profitability and growth in a market that is increasingly competitive. You've addressed that during your presentation, but maybe in a few sentences as a wrap-up for that question.

I'd like to pick up also what Tobias said. I think the most important thing is that we develop outperforming market position. But we developed this coming from our core competence and core capability that we are not, let's say, screwup because there might be significant potentials outside, but we need step-by-step working along our key competencies and core capabilities. This is the first thing.

Second thing is we really need to be open-minded for new technology. I'd like to say, was the technology we today not even know the self problems, we think they are unfavorable today. And this is really something that is a [indiscernible] that the, especially for R. STAHL, but also from my understanding in the global German society that we are more positive and more risk open to use new technology to be open, maybe one or the other time it will fail, but the end, I'm absolutely convinced that the sum will make us successful.

And the third point is that we are open for partnerships because I'm absolutely convinced that this one shop stop solution that we are one partner for our customers, but also for the operators, will be a major hereto of success. And therefore, we need to be the one with strongest global network, and this would be the third point I like to highlight here.

Thank you. Let's look at 2026, 2027. The market environment remains challenging -- do you have any additional cost reduction measures planned over the next 2 years to, on the one hand, secure profitability and stabilize the results?

First phase is mostly dedicated to, let's say, manage costs and to set a stable foundation. So answer is yes. This is the entire first phase. And as we've shown, the elemental phase will be highlights in 2026, we will see the effect fully in 2027. This will be a starting book. But looking forward, I think, and we had a good conversation about this also in the Board of Directors is that we need in this company a culture in mindset, let's say, being cost effective with a continuous way of working to daily business is always to challenge ourselves.

Are we cost effective? What can we do? And I'd like to share with you, I had really good meetings even when I was here at lunch in the casino that conversation started with some of the employees were just asked, "Hey, guys, do you have ideas how you could improve your cost efficiency?" And I thought now they stopped talking, but the opposite also was the case. We started one conversation and ended up that we were sitting together and I got 2 word papers full written with ideas of these colleagues. And I was deeply impressed that the company has such broad ideas and it's up now to us within NEXUS to bring it on the road. So again, to sum up, managing the cost will be focused on Phase 1 and then continue in our daily work.

Thank you so much, which brings me to the last question for today. And that is, once again, circling around the capital structure of R. STAHL. It reads, you mentioned that you were in good or in good talks with the main shareholders. Will the shareholders support R. STAHL financing future growth? How much invest is necessary to achieve sales of EUR 500 million in 2030, you think.

As I mentioned, this is a good and right question, there will also be the right time to answer this. To answer the numbers what [ invest are ] needed, today is not the right time. But I could say we are at the starting point to discuss with already established shareholders and investors but we are also in a broad conversation with new kids on the block, so saying.

We are still in the initial phase but what I'm really happy is that, let's say, the genes and the main ideas both the program ex that I shared with you today where on [indiscernible], we are falling on a fruitful base. So I see a good potential, I'm quite optimistic that we will find partners also on the investor side to make it happen. And as one of the question are already pointed out, it will be also needed.

So this is definitely -- if you see our cash flow situation, it's quite clear, and it's not a silicated answer, but we cannot, let's say, fuel invest that we need out of our operating performance, investors from outside of the company. We published on a new one will be needed, and it's a need on a significant level. This is absolutely clear that there's nothing on that.

Thank you. Thank you, Claus. Thank you, Tobias. We are out of questions. If you have any closing remarks from your end before I do my closing remarks. This is your floor.

First of all, Tobias and myself, thanks all of the attendees for today's call. It was a pleasure for us to present the financial results, but also give first insights about NEXUS.

As we pointed out, it's the starting point. So we are looking forward to a broad conversation and it should be an open conversation because NEXUS is nothing that is, let's say, written in stone. That is something that should be our teams is question how we bring it to life and all feedback or input will help to make it a broader success today's call, please understand also as an invite for a further conversation. And good possibilities for follow-up is the next upcoming earnings call on end of May. And of course, also, let's say, mid of June than the annual meeting.

We enjoyed today's call Tobias and myself, especially because there was really a broad number of questions, really good questions. Thanks for that because I gave also a feedback that today's content was really something that was, let's say, well taken by all people dialed in, thanks for that. All to you, have a good week. And for all of us, hopefully, day by day, we are looking in a more safe world. Thanks.

Thank you so much, Klaus. Thank you so much to be us. Thank you so much for everybody who joined this call. Thanks for your great questions. I have a few slides that I just want to show while I'm doing my wrap-up on my end.

A couple of things. If you have any additional questions in the aftermath of this call, please feel free to reach out to the IR of R. STAHL. Or also, of course, you can talk to our analysts, if you have any more questions. In addition, we will send out or already have sent out a small questionnaire, a feedback form for this call.

We very much appreciate if you take the time to just fill it out so that we can supply the company with feedback about this call. And then, of course, last but not least, this call was recorded, and you will find it a little later today on the R. STAHL web page in the IR section and on Research Hub.

I wish you all a great afternoon, and thanks again for joining. See you all on May 7. Bye.

Ladies and gentlemen, I welcome also from my side, and thank you for joining our today's conference call. Our prepared slides are available under the Investor Relations section of our website, www.r-stahl.com. Shortly after we will have finished this call, a replay of the entire conference will be provided for download at the same place. Please be aware of our disclaimer statement, which you find at the beginning of the slide deck.

Next to me is the entire Management Board. New joining Dr. Claus Bischoff; Tobias Popp; and Dr. Mathias Hallmann, our Group CEO, who will now walk you through our presentation.

Okay. Good morning, ladies and gentlemen. A warm welcome from my side to this Q3 2025 Analysts, Investors and Press Conference Call. As always, we start with a quick summary.

Our order intake in Q3 remained at a low level of EUR 72.2 million. Prior year, we had EUR 74.4 million, but we also should have in mind that in the first quarter this year, we had roughly EUR 98 million. So second quarter, third quarter were significantly lower and we see weak demand from nearly all customer industries in all regions. That resulted in decreasing sales in all regions with a year-on-year decline of 10.1% to EUR 78.6 million.

Nevertheless, EBITDA pre improved by 28.8% to EUR 11.3 million because of cost reduction measures; EBITDA pre margin resulted at 14.4%.

Free cash flow fell by EUR 5.5 million to EUR 0.5 million, mainly due to build up of working capital. We come to that later. Net profit increased to EUR 2.6 million. Prior year was EUR 1.8 million and earnings per share ended at EUR 0.39, prior year EUR 0.28.

When we look into the details, we see the sales decline in all regions: Germany, down 15.9%; Central region down minus 3.5%; Americas, down 11.4%; and Asia Pacific down 17.3%. What's new to us is that especially Germany, which remained stable through all the crisis in the last couple of years, this time shows a significant decline. We have to admit that not only our core industry, the chemical industry is still under significant pressure, but also the pharmaceutical industry is getting under more and more pressure due to the global uncertainties with respect to taxes. Americas' the oil and gas industry, especially under pressure and Asia Pacific, no decisions on any big investments at this point of time.

When we look into our P&L statement, we see a total operating performance, which is almost on the level of last year. Here, we also see the work up of working capital, which is due to big projects we booked in Q1, and we have some finished goods or significant finished goods already in our warehouses for those projects, which are about to be delivered partly in Q4 and in Q1 2026.

Cost of materials are still under -- well under control, a little bit higher ratio due to the build up of unfinished and finished goods. Personnel costs include EUR 2.2 million of severance payments without those, where they would fell by EUR 0.8 million despite significant wage increases across the world. So, we see here the impact of our cost measures with respect to personnel. We also see it in our other operating expenses, which came down from EUR 15.9 million to EUR 14.6 million. That results in stable EBIT, stable EBT and then improved net profit of EUR 2.6 million. The other numbers we already discussed.

Free cash flow, the major impact is -- comes from changes in working capital, minus EUR 3.9 million, so that cash flow from operating activities is down EUR 6 million. Free cash flow is on a level of EUR 0.5 million then in comparison to EUR 6 million last year. And our net debt is increasing to EUR 40.5 million from EUR 29 million last year.

Already mentioned that we are working on structural measures to adjust to the ongoing weak market demand. In Germany, we started a socially bound structural personnel adjustment program using the tool of a Transfergesellschaft. 73 employees are or will be transferred into this Transfergesellschaft until end of February '26. That means, 73 employees have signed agreements. So, I think 58 of those are already in the Transfergesellschaft at this point of time.

Total onetime costs are slightly lower than EUR 5 million and will finally lead to a personnel cost reduction slightly above EUR 6 million at this point of time. But we are planning additional personnel cost measures or some of them are already implemented. We have partial reduction of weekly working hours starting this month, and we have closing weeks, closing days around Christmas. We also have tight expense control. Travel is limited to the absolute necessary and other operating expenses in total are under tight observation and control.

Our outlook, our guidance for 2025 remains stable. Sales forecast is around EUR 320 million to EUR 330 million. EBITDA pre is still expected between EUR 25 million and EUR 30 million. Free cash flow should be balanced, and we would expect a slight decrease of our equity ratio as long as pension stay or the interest rate for the pension provision stays stable.

The risks, we all know, it's the general economic development, the geopolitical conflict and some environmental risks. This is ongoing. We have to manage that since quite a while, so nothing changed.

That's it from my side. Now I and also my two colleagues are open for questions.

[Operator Instructions] The first question comes from the line of Nico Löchner from Solventis.

I have a few questions. You said the demand was weak from almost all customer industries. Which industries performed better then or had a positive development then?

I cannot really see -- I mean, there's one industry which remains pretty stable, that's LNG as part of the energy industry. All the others, especially the chemical industry in Europe, pharmaceutical industry, on a global level, India is very soft in the pharmaceutical sector. Oil and gas is particularly under pressure in North America. So the only highlight at this point of time, I would see in the LNG industry.

And do you expect additional costs related to the cost-cutting program in Q4 and 2026?

We will see additional costs with respect to the cost-cutting program. As you see, what we achieved in the first wave was pretty -- yes, the costs were pretty much under control, but we would probably see similar ratios that when we -- I have no numbers in mind how many people we might reduce in the future. But for example, if we have to reduce another 20, 30, then we would also see additional cost in the range of EUR 2 million to EUR 3 million.

So this ratio will be stable, but we haven't decided yet what's the final amount of people we have to reduce. We still hope that the economical situation will improve, then we can do more about temporary work hour reduction. If we come to the final conclusion that it's not going to improve in the next 6, 12 months, then we will probably go more into the structural direction.

So, you see no light at the end of the tunnel currently?

You know that saying, the light can also be the incoming train. I can't -- I don't know. I don't know whether it's the light at the end of the tunnel or it's the incoming train. We were expecting improvement, for example, in the chemical industry. What we see now and it's communicated in the press is that it goes further down.

I cannot see significant improvement in the pharmaceutical industry as long as our friend Trump is not giving away his taxes. It's huge taxes, for example, for India and China. And -- and also, when we look in the channel of our machine builders, which is a strong distribution channel for us, and they do equipment for the chemical, for the pharmaceutical and for the oil and gas industry, their order pipelines are getting dry at this point of time. So, despite the fact that some optimism is there in the general industry, we also have to admit that we typically -- we are late in the cycle. So, if the general industry is going to improve in the next 6 months, it will probably last another 6 plus 9 months more until we have those effects in our book.

And you want to achieve a balanced free cash flow this year?

Yes.

And is it mainly the reduction of the inventories to reach that number or other arrivals?

Yes. It's a reduction of inventories plus deliveries of big projects. So, which is finished goods, which will then be delivered, hopefully, in Q4 to our customers.

The next question comes from the line of Harald Hof from mwb research.

And I would like to do it also one-by-one. So, I'd like to start with the first question regarding the order momentum in Q4. Can you put some light or provide a little bit more color on this topic? Is it still going on weak? Or do you see at least a stable development compared to...

Stable on a low level.

Stable on a low level?

Yes.

And do you see any kind of change in behavior regarding the year 2026? Do you expect a recovery from the different industries? Or do you still have the impression that the order momentum and also the revenue generation will be weaker?

Our planning scenario is that, we remain on the level we have right now. And the answer is basically the same I just gave to Mr. Löchner. Even when the general industry may improve and some of the political uncertainties disappear, we -- it will take another 6 to 12 months until we see those effects in our books.

Okay. And we've discussed the pharmaceutical industries already. A follow-up question regarding this topic. Do you have any reason why the pharmaceutical industry is weak? Because it's normally a quite stable industry. It's also part of Trump's relocation to the America first situation that the new production facilities are expected to be relocated in the U.S.

I'll give you one very specific example. I've been -- I was in India last week. And the pharmaceutical industry is our biggest customer industry in India and 50% of their volumes go to the North American market. And they are significantly down because they have, I think, 35% of taxes. And so that's bringing significant pressure on them. And investments are not really taking place in the same amount in the U.S. at this point of time. I mean, those plans, they need time, then you need -- you also need the people doing it. At the end of the day, the whole industry is slowing down in this uncertain situation.

Okay. That's a quite specific example. And, makes it quite understandable what's going on. A final question regarding -- from my side regarding the Q4. Looking at the severance payments, you provided on the slide that it will be like EUR 5 million full effect. We saw in the 9 months EUR 3.6 million. So you could expect a EUR 1.4 million for Q4. Is it...

No. No. The EUR 5 million we used for the 32 contracts signed. Those will have an impact of EUR 6-plus million in cost savings, not completely next year, but when they are all implemented by the end of the first quarter next year, then we have that full impact in the P&L.

We don't know at this point of time what impact we will see from additional measures, because as I just explained, we hope that we can dive through certain phase with other measures like reduced working hours. But we will need a certain portion of structural measures. And the final decision how much each has to contribute is not taken right now. But we would expect the ratio will be similar that we spend less in onetime costs than we save in cost reduction.

[Operator Instructions] Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Judith Schauble for any closing remarks.

Ladies and gentlemen, thank you for joining our today's conference call. With this quarterly statement, we disclosed the financial calendar for 2026. On February 24, we will publish the preliminary figures for fiscal 2025. And on April 16, will be the next conference call after publishing the annual report. We hope to talk to you again latest on this occasion. Have a great day. Goodbye.

Ladies and gentlemen, welcome to the R. STAHL Investors and Analyst Conference Call for First Half 2025. I am Jota, the Chorus Call operator. [Operator Instructions] The conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Judith Schauble, Investor Relations. Please go ahead.

Thank you, Jota. Ladies and gentlemen, welcome also from my side, and thank you for joining our today's conference call. Our prepared slides are available under the Investor Relations section of our website, www.r-stahl.com. Shortly after we will have finished this call, a replay of the entire conference will be provided for download at the same place. Please be aware of our disclaimer statement, which you find at the beginning of the slide deck.

And now I will pass on to Dr. Mathias Hallmann, our Group CEO, who will walk you through our presentation.

Good morning, ladies and gentlemen, also a warm welcome to this Q2 2025 Analyst and Investors Conference Call. I'll start with the summary. We had a quite difficult quarter driven by huge economic uncertainties. Our orders saw a massive drop to EUR 67 million, prior year, we had EUR 88.5 million. Some of you may know, we had EUR 98 million in the first quarter. So that's a drop of more than 30% to Q1, and we saw especially significant declines in the Central region and in Asia Pacific.

As a consequence, we saw decreasing sales with a year-on-year decline of 13% to EUR 77.9 million, and that all resulted in lower EBITDA, which came out at EUR 5.3 million and EBITDA pre margin of 6.8%, where we had 12.2% the year before. Free cash flow fell by EUR 6.3 million to minus EUR 9.1 million, mainly driven by the lower profitability. Net profit came out with a loss of EUR 2.5 million, prior year was EUR 3.7 million and earnings per share at minus EUR 0.38, prior year was plus EUR 0.57.

If we look into the regions, you see declining sales in -- mainly in Germany, in Americas, in Asia Pacific, not so much in the Central region where we were benefiting from a strong order backlog. But I just mentioned that especially in the Central region also the order entry went down significantly in the second quarter.

Looking then into the profitability or the P&L statement, we can summarize that we have 2 issues. The one is the top line and the other is the personnel costs. The top line came down, as mentioned, from roughly EUR 90 million to roughly EUR 78 million. That also resulted in lower total operational performance. Material costs look a little bit higher or they are higher, but that's mainly driven by a buildup of unfinished and finished goods, while we had in the last year and negative effect in the finished and unfinished goods, and that's clearly related then to the material cost. Overall, we see no problems in our material costs. Personnel costs remain almost stable as we have some severance of EUR 1.2 million in the second quarter. Without that, we would see reduced personnel costs. Other operating expenses are on the level of the year before and then all it boils down to the slightly negative EBIT and negative net profit of minus EUR 2.5 million as just reported.

As I said in the beginning, the problem clearly comes from the top line, which is significantly reduced against last year. Even we had, again, inflation between last year and this year. So the actual decline is even a little bit higher. And on the other hand, we see inflation in our cost structure. So this is something we are working against, and we will come to that pretty soon after the next slide.

Free cash flow already mentioned is negative. The main effect comes from the net profit, where we fall down from EUR 3.7 million last year to minus EUR 2.5 million. That brings a change of EUR 6 million. Then we have a buildup of working capital in the second quarter. We expect that to come down in the consecutive quarters. Nevertheless, that all then results in a negative free cash flow of minus EUR 9 million. And that drives a higher net debt, which is now at a level of EUR 44.6 million.

It's already in the press. We are -- and some of you might have read it already. We are addressing our structural cost position at this point of time. And I just mentioned, we think we do have our material costs and our other operating costs well under control. What we cannot control easily is our personnel costs. We -- in order to reduce that, we closed one of our production sites, a small production site in Oslo. We did that during the second quarter. We saw a reduction of 12 employees there.

And in Germany, we started a socially balanced structural personnel adjustment program using the tool of Transfergesellschaft. Employees are transferred in this Transfergesellschaft, which is a new company in order to get further qualified for the open job market. They can remain there up to 12 months. The target we have is a reduction of around 80 employees until the mid of next year with a cost reduction of up to EUR 10 million per year. I think I should say it should not be less than 80 FTEs or employees looking at the current economic situation. The severance payments, we used for that in the second quarter totaled at a level of EUR 1.1 million.

That brings me to the outlook. We had to adjust our guidance for the year in the light of the current economic environment. We previously forecasted our sales on a level of EUR 340 million to EUR 350 million. We now expect EUR 320 million to EUR 330 million, which requires significant improvement, especially in Q2 and Q3. And we do see that in the month of July so that we feel safe at this point of time with this forecast of EUR 320 million to EUR 330 million. The EBITDA is now expected between EUR 25 million and EUR 30 million. Previously, we expected EUR 35 million to EUR 40 million. And we expect somewhat balanced free cash flow. Previously, we were expecting a middle single-digit euro million amount, a positive middle single-digit million amount. And we will see a slight decrease in our equity ratio under the assumption that the interest level for the valuation of our pension remains stable.

The risks are clear. We see the economical risks. We see the geopolitical conflicts. This is something we have to have an eye on. But at this point of time, I think this is a pretty stable outlook, and we are confident to achieve it towards the end of the year.

This is it. And now we are open for questions.

[Operator Instructions] The first question comes from the line of Harald Hof with mwb research.

Just 2 questions from my side. The first one is regarding the personnel cost effect. You mentioned the EUR 10 million in savings. Can you provide a little bit more color when do we see these effects? Do we expect them in H2 '25 already, at least partially? Or do we have some further one-offs regarding the payments for the employees?

And the other question is regarding the EPS for the full year. Part of your guidance is that you are expecting a decline in the equity ratio, which indicates that there's like -- yes, the net profit will come in slightly negative for the full year. Is that correct? Or do I misunderstand this?

Second question, correct. Yes. With this guidance and if we don't see positive tax effects or something, we would expect a slightly negative earnings per share. First question, effects from the personnel reduction. What we see right now is that we have the charges for the Transfergesellschaft, which we have especially in the second half of the year. But we already have some personnel cost reduction, but the main effect we will see in the year 2026.

The next question comes from the line of Klaus Schlote with Solventis.

I've got a question regarding the top line development. It looks like it's all macro driven, it's politics, it's trade restrictions whatsoever, but it's not really caused by your products or changes in the situation -- in the sector. So question is you're really depending regarding the top line only on the macro developments, really cannot steer against from a micro point of view? Or is it -- would you see that differently?

I mean you're absolutely right. In the long term and also in the short term, you can hardly work against the market. Certainly, we can, in the long term, try to get more market share, and we quite successfully managed that, especially in the DACH region and in Europe over the last couple of years.

But in the short term and in the midterm, we are heavily depending on the economical conditions. The competitive landscape didn't change. I don't think that we -- that new competitors, technological changes or anything is driving all that. We see nothing of that. It's just that we miss a significant portion of our business, and that's projects.

Normally, we have roughly 20%, 25% of our business is big projects. And what happens right now is these projects are in the market, the pipelines are full, the financing is there, the projects are in generally approved, but they are not starting. There's so much uncertainty in the market that everybody is holding back final decisions. This is what we see. We hardly see those projects happening, and that's really harming us.

The second effect, which is not that critical, but it's also part of the situation is the general weakness of the European economy, especially in the chemical field. This is also something where we are suffering from because we are historically very strong in the chemical industry. This is where STAHL came from, especially in the DACH region, and we all know that this industry is suffering. And those are the 2 main effects. But you're absolutely right, there is no change in the competitive environment.

What about the dollar, the U.S. dollar, which was devaluating over the last month? I think it's even exceeding the tax rate of 15%. How is that affecting you?

Not that much. We do have a factory. There are 2 things. First, we do have a factory in Houston. So we have quite some value added there. And when you look at the import part from our components, there's a lot of automation products and almost all automation players are coming from outside. There is almost no local competition, nobody really producing in the dollar area. So everybody has the same problems. The dollar is not really impacting us that much. It's the tariffs and even more the uncertainty in the market.

And what about your investment projects in Asia and as I remember also in the U.S., how is that proceeding? Is that finished yet or...

We started 2 significant investment projects. The one was the expansion of the factory in Weimar, our lighting factory, that's finished. The official opening will be in August, but it's already finished.

The second is a significant expansion in India, and that's ongoing. And we -- it's clear for us that we will continue with that because we do need a stronger footprint in that part of the region for the further expansion in that part of the region, but also to have a place where we can have some labor-intensive, not so much technology-intensive work done. And therefore, we have ongoing investments in India, and those will also continue in this situation.

Of course, the Asian market was quite weak for you.

It was quite -- it was quite weak, but we cannot base investment decisions only on a quarterly development. And India is not only for Asia. It's also important for the European sector, and it's important for North America. Even when we saw these -- we see these tariffs of 30% now from India to North America, we would not expect that those remain forever.

Regarding the personnel cost reductions, is that already on the balance sheet for the cost for reducing 80 people?

What we have in the balance sheet is severance payments of EUR 1.1 million, which we paid for roughly 30 people who have signed their contracts until the 30th of June. In the meantime, we have 20 more. Those will then show up in the third quarter from a severance pay perspective. And we do have a cash flow effect from the payments to the Transfergesellschaft, but they have -- they don't show up in the P&L at this point of time.

Okay. And then last point, you said you see improvement in Q3 and July, it's only just 1 month, but maybe some starting and kind of continuing improvement during H2. Can you put some more color on that? Where is it taking place the improvement? Can you locate that?

Yes, it's a general thing that now we will see in -- especially in Q3, deliveries from our order backlog, bigger projects in many regions. What we don't -- we saw a slight improvement in the order intake also in July. So it's 2 effects. The one is that we still have some significant orders in the backlog. The other thing is a slightly improving order intake. Both effects resulted in a quite strong July. Now we have to see what August and September will deliver, but we are slightly more optimistic than in Q2.

[Operator Instructions] Ladies and gentlemen, there are no more questions at this time. I would now like to turn the conference back over to Judith Schauble for any closing remarks.

Ladies and gentlemen, thank you for joining today's conference call. Our next conference call is scheduled for November 4, together with the publication of the Q3 interim report. We hope to talk to you again on this occasion. Have a great day. Goodbye.

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