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[Audio Gap] on left to right, it shows the revenue breakdown by segment, by type and by location of customers. First, by segment on the pie chart.

CA contributed 41%, DPS, 43% and USS 16%. Now DPS spans both local and international customers as well as commercial domains such as critical in infrastructure and not just defense domains. Hence, the DPS segment revenue of $2.8 billion, you can see on the bar chart, sorry, on the pie chart, differs from the Defense revenue of $2 billion on the bar chart in the middle.

Now in the center, we show revenue by type. Commercial revenue rose from $4.1 billion to $4.6 billion or 11% year-on-year. Defense revenue from $1.8 billion to $2 billion or 12% year-on-year. On the right-hand side, we show revenue breakdown by customer location. Asia contributed 55%, U.S. 14%, Europe, 23% and Others 8%. Revenue to customers in Europe increased were those of U.S. reduced largely as a result of the divestment of LeeBoy in September last year. But importantly, the overall group revenue increased 11%, as I have described.

Slide 7. This 11% revenue growth is contributed by all segments. Excluding LeeBoy, it would be 14%. Excluding both LeeBoy and the weakening U.S. dollar, for which many of our revenue are denominated, group revenue would have grown by 15.5%, close to 16%. So a very healthy underlying revenue growth.

Slide 8. EBIT. EBIT grew by a very strong 23% year-on-year to $738 million. On a rebased basis, excluding LeeBoy and our share of Citycab, both of which were divested last year. EBIT grew 27%. [indiscernible] test for underlying performance is cash flow. Here, our operating cash flow grew very strongly at 26% from $761 million, first half '25 to $960 million first half '26. And this underscores the strength of our core business. So the accounting numbers are very straightforward. EBIT rose 27%, I would drag into what are the drivers of that growth, but the cash also grew 26%.

Slide #9, net profit. Net profit improved from $403 million in first half '25 to $512 million in first half '26. An impressive 27% year-on-year improvement. Now this is enabled by one, stronger product and margin mix; two, higher productivity. We have aimed to secure about $200 million a year in productivity. We have already secured more than $150 million in the half year. And lower finance costs as we generated more cash flow, as I described, we are able to pay down debt and reduce interest costs. We are indeed very encouraged by our growth momentum and are confident of finishing the year strongly.

By that, remained strongly in terms of earnings, not just top line. DPS is targeting a similar growth momentum as they did in first half '25. CA expects continued strong earnings growth rate and USS will have a stronger second half. So offset all segments are poised to finish the year strongly.

Slide 10, let's move on to business segment discussions. Commercial Aerospace revenue grew 15%, $2.7 billion, and this is at halftime, $2.7 billion. This was driven by stronger engine MRO, the sales and spare sales. CA EBIT grew by a very strong 29% to $288 million on the back of higher revenue, better product mix and cost savings.

Slide 12. Next on DPS. DPS revenue grew 7% year-on-year on a reported basis. However, on a rebased basis, which is the underlying growth, DPS revenue grew 14%, 14% year-on-year to $2.8 billion. This is largely because LeeBoy was divested in September last year. And hence, for the full first half of '26 we do not enjoy any LeeBoy revenue. Digital business, spanning cloud, AI analytics and cyber achieved 27% revenue growth year-on-year from $367 million to $468 million in first half '26, $468 million, just for the digital business aspect. This shows an increased momentum given that in 2025, Digital business revenue grew 15% year-on-year and now 27% if you compare first half '26 to first half '25. We are about 1 year ahead of schedule, and we'll achieve our targeted 2029 annual revenue for digital business of more than $1.3 billion, not in '29, but in '28 or earlier.

International defense wins amounted to $1.2 billion for first half '26 compared to more than $600 million for the full year of 2025. So by this year-end, since we have achieved $1.2 billion in first half '26, we will be well above 2x of the full year 2025 wins, which is more than 600. So last year, we are more than 600 million. First half, we are already $1.2 billion. We have half a year to go, and hence, we will exceed 2x 2025 wins. On a reported and rebased basis, DPS EBIT rose 10% and 16%, respectively to $404 million, ahead of its revenue growth.

Slide 13, moving on to USS segment. Revenue grew 15% to $1.1 billion, and this is contributed by both URS and Satcom. USS EBIT improved from a low base of $12 million to $46 million and boosted by stronger revenue across both businesses. Satcom cost reduction initiatives, which we have explained previously, were completed by end of the first half of this year with $63 million of annualized cost savings, and these are starting to accrue. I will cover Satcom in greater detail in the next slide.

Slide 14. The iDirect improved its financial performance in first half 2026. Revenue grew 18% year-on-year, increasing from $117 million to $138 million. Cost savings initiatives, as I mentioned earlier, $63 million on an annualized basis were completed in first half 2026 as planned. This puts iDirect on track to becoming EBIT positive. IDirect intuition portfolio of products and services continues to gain traction with customers. We secured strategic wins in Asia and Europe, supporting mission-critical operations for government and defense contractors. While our new software-defined modem is gaining good adoption with U.S. and international government and defense customers. This new software-defined modem is a key differentiator, which enables multi-way form multi-orbit operations on a single edge platform. Protecting customer investments, as mission requirements and networks evolved.

INTUITION [ Foresight ], which is a trade name for this single pane of glass that there have introduced, have increased traction with customers. It does so by delivering AI driven intelligence that helps customers simplify their network operations. So it is a network management system through a single pane of glass so that they can have a hybrid more dams and they can manage their network through intrusion for site. This allows them to scale their networks and also do so more efficiently. So as a result of both our cost initiatives and product initiatives and customer traction, we target for Satcom subsegment to be EBIT positive in 4Q '26 and in the year 2027 as well.

Slide 15. This next section is about contract win and order book. Our contract wins totaled $7.6 billion for 1 half '26. This was contributed by DPS, $3.6 billion, CA $2.9 billion and USS $1.2 billion. Our order book stood at a robust $35.7 billion as at end June 2026. Now we have included the NJTA E-ZPass contract this quarter. But of this $35.7 billion of order book, $5.7 billion is expected to be delivered over the remainder of the year. Based on the current sales pipeline and barring exceptional events, we expect contract wins for Q3 '26 and 2 half '26 to be strong.

Slide 17. This slide details our new contract wins for second quarter '26. In the quarter, the group secured new contracts worth $1.2 billion for CA, $1.2 billion for DPS and $0.5 billion for USS. As I said, the NJTA E-ZPass service contract was awarded to TransCore and included here, it was awarded in September 24, but we have not included at that time. due to some ongoing legal appeal the incumbent service provider who lost the contract. It was not -- it has been recognized in the order book now more than a year after the customer affirm that the contract remains awarded to TransCore and this was in April '25.

And also the commencement of the contract, there was already a notice to proceed and contract and revenue has been accruing since May '25. This contract also includes options for 2 further 1-year extensions, valued at USD 0.4 billion or [ SGD 0.5 ] billion, which have not yet been included in the group's order book according to our policy because the option is for the customer to exercise. But the base amount has been included in our order book.

Slide 18 -- 19. the Board has declared a higher interim dividend of $0.05 per ordinary share for the quarter ended 30th June 2026, which is a sign of our confidence for a strong 2026 financial performance and dividends. The record date for the second quarter interim dividend is on August 2026, and payment will be on 4rth September 2026. Additionally, the Board has planned to pay out a dividend of $0.05 per ordinary share for the third quarter ended 30th September 2026. So we used to pay $0.18, if you remember, as a base dividend in 2025. So it was like [ $446 ]. This year, first quarter was 4. Second quarter, we have now declared 5. So it's higher. Third quarter the board plan to declare 5 and then for the final dividend, we will use our dividend policy to compute, and this is how it worked.

For a total dividend on '26, it will be based on $0.18 as a base which is last year's ordinary dividend and about 1/3 of the year-on-year incremental net profit per share. So the base will be 2025 BOP net profit of $851 million. And then depending on how much is the net profit in 2026, we use that number minus $851 million. And that difference we will take 1/3 to be paid out as dividend. And of course, if we have already paid 3 interim dividend, the balance will be paid in the fourth quarter.

Okay. The final dividend will be proposed in February '27, subject to shareholders' approval. Slide 20. Last but not least, this is the group CEO's message, and let me read it out to you. The group achieved strong revenue and earnings growth for the first half. Our earnings growth rate outpaced, in fact, well outpaced the revenue growth rate. The robust performance was underpinned by the strength of our businesses and disciplined execution. We are encouraged by our growth momentum and are confident of finishing the year strongly. At the same time, our strengthening order book and robust pipeline of opportunities, stand us in good state to drive continued revenue growth.

Slide 21, a summary. We delivered a strong set of results for first half '26. Both revenue and earnings year-on-year growth rate was strong. In fact, earnings growth rate outpaced revenue growth rate. Order book continues to strengthen to $35.7 billion and this will provide revenue visibility. Based on the current sales pipeline, we expect contract wins for 3Q '26 and 2 half '26 to be strong. We are confident of finishing the year strongly. Our midterm 2029 goals remains well on track. Interim dividend $0.05 per share was declared for second quarter '26 and is also planned for third quarter '26.

This marks the end of my presentation. Thank you so much for your attention. I will now hand over to Vincent for his key remarks. And can we invite the exco-members to the stage. Thank you.

Thank you, Cedric. The panelists this morning are Vincent Chong, Group President and CEO; Jeffrey Lam, Group Deputy CEO; Cedric Foo, Group CFO; Mervyn Tan, Group Chief Operating Officer, Technology and Innovation and President of Defense and Public Securities; and Tan Lee Chew, Group Chief Commercial Officer, Market Development and President, Smart City and Digital Solutions.

I will now hand it over to Vincent to deliver his remarks. Vincent, please.

Okay. Good morning, everyone, here at ST Engineering hub. And for those who join us online, thank you very much for joining us this morning. Now Cedric has covered the key financial numbers, so I won't repeat them.

Now behind the strong first half 2026 results, there are a few things about how we grew that matter more than the headline figures. And I plan to focus on those points in the next few minutes. First, as Cedric mentioned, First half 2026 was the strongest first half results that we have seen -- we have experienced on record, also with a higher quality of growth. And I think that's an important point. The robust results were driven by our strong underlying performance and cost savings across all 3 segments. And more importantly, this is not a one-off high but a reflection of the higher quality, more durable earnings base that we will continue to build. As we grow and expand our scale, we are becoming more efficient. So more of our revenue growth flows through to the bottom line.

Now if you recall, in 2025, we had a full year unit OpEx, which defined as the total operating expense divided by total revenue. We had 10.2%, which was at a record low. And in first half of this year, the unit operating expense expressed as OpEx over revenue went down to 9.1%. Really a show of the continuous improvements that we have made productivity gains as well as procurement savings and in many ways, also supported by efficiency in our processes, in many cases, enabled by AI. So that's what gives us confidence in the quality and not just quantity of our growth. We are confident of finishing the year strongly, as Cedric mentioned.

So just to recap, for second half of 2026 our DPS segment is targeting a similar growth momentum as first half '26. Commercial Aerospace segment is targeting a continued strong growth rate in second half. And our USS segment will have a stronger first half -- second half, I meant compared to first half of 2026.

Now second, the demand behind our business is structural in nature. As I've mentioned on many occasions, in the Commercial Aerospace segment, air travel keeps growing, while new aircraft demand continues to outstrip supply. So aircraft fleets fly longer, driving demand for our airframe and engine aftermarket services. The growing fleets also support strong demand for our nacelle and composite floor panel businesses.

In Defense & Public Security segment, Governments are investing more in security and resilience and that's playing directly to our strengths. Our digital business spanning cloud, AI analytics and cyber is growing well ahead of plan because we are positioned where the demand is heading. In fact, based on the trajectory we're saying -- seeing and as Cedric already said, our Digital business is tracking about a year ahead of our 2029 revenue target of more than $1.3 billion by then. And the pace of urbanization continues to drive investments in smart mobility and critical infrastructure, where we are seeing good momentum across our rail and road mobility businesses, and these are multiyear tailwinds and our USS segment is well positioned across all of them.

Earlier on, I mentioned AI. Now AI runs through our businesses in 2 ways, 2 main ways. We are a developer of AI-enabled solutions with it built into the products we deliver. For example, across defense, cybersecurity and Smart Mobility and beyond. We are also a user of AI, applying it across our own operations, making them more efficient, resulting in lower cost in our operation. And AI is not new to us. It is core to how we compete and how we grow. And you would recall that we have been sharing more details about our digital business, including AI analytics since 2021 Investor Day conference.

Third, we execute with discipline. We are thoughtful about the commitments we make, and we are consistently delivering on them. The discipline behind all of it is that we continue to drive sustainable and profitable growth. And such discipline runs across the group, and you will see that come through in our very strong track record in the years past.

Fourth, on contract wins, looking beyond the last quarter, and we encourage you to look beyond the last quarter, Second quarter of 2026, new order wins was lighter than previous quarter because contract awards are lumpy by nature. We have been talking about this point very consistently. As the timing of contract awards moves with customer funding and procurement timing and variability between quarters is quite normal. So we don't get to focus on any quarter, be it up quarter or down quarter, and we look at long-term trends, which remains intact.

As we move through the third quarter, opportunities that we have been pursuing are already converting into contract awards. Recent announcement examples include the [ Toon Brown Line ] project in Taiwan for Mobility Rail and 40 mm ammunition contract in the U.K. In international Defense, we secured $1.2 billion of wins in the first half about twice the total wins achieved for the whole of last year as we -- in line with our target with additional opportunities progressing through the pipeline.

Our -- in first quarter this year, if you recall, we shared the pipeline of opportunities that we have for International Defense, and we said that the pipeline size was USD 11 billion over the next 18 to 24 months as of first quarter. And that pipeline remains intact. In fact, we expect the pipeline to come through in the next 15 to 20 months because 3 months ago, it was 18 to 24 months. Now the time line is in the next 15 to 20 months. So basically, it's not changed. So we remain very confident that the opportunities are there for us to capture.

Now these developments -- it reinforced our confidence that underlying demand remains healthy and that our pipeline continues to be robust. And even if the timing of awards does not always align neatly with a particular reporting quarter. Many of our -- the opportunities in our pipeline remain active. In fact, we expect our contract wins for full year 2026 to be similarly robust as full year 2025 with potential upsides. But of course, the market will develop as they do. But basically, based on what we know of today, we expect the full year 2026 contract wins to be as robust as '25. And potentially, there may even be upside, okay?

Now barring unforeseen events, we expect order wins in 3Q, third quarter and the second half of this year to be strong, as Cedric already mentioned. Now that brings me to our final point in terms of the attributes that are working in our favor. Our growth outlook is grounded in the strength and resilience of our business and in what we are building and delivering. The external environment, we all know will remain challenging, but our confidence rests on the strength of our portfolio, the durability of demand across the markets that we serve and our proven ability and track record in delivering long-term profitable growth.

Now this is backed by our very strong order book equal to nearly 3 years of our financial year 2025 revenue, giving us clear visibility on revenue and earnings in the coming years. Taken together, these positive factors put us in a strong position as we enter the second half of the year and support our expectation of finishing 2026 strongly.

Finally, the group's performance continues to be underpinned by strong and consistent cash generation, which allows us to reinvest for growth while delivering sustainable dividends to shareholders. The higher interim dividend for second quarter 26, which Cedric just walked you through, and our intention to continue growing dividends in tandem with profit growth reflects that commitment. We remain on track to achieve the growth trajectory we set out at our Investor Day for 2029. And in the long-term growth of the group, maybe does give you a quick update on where we are on our 5-year plan.

We are tracking our 5-year targets very well. Commercial Aerospace revenue and group net profit more than 1 year ahead of plan. So we achieved them more than 1 year ahead of plan, at least 1 year ahead of the 2029 plan, with the rest tracking well, including the digital business, which we are already ahead of plan by about a year. And we also expect the next few years for net profit to continue to outpace revenue by up to 5 percentage points higher than revenue CAGR because I want to address this proactively. Some may think are we upfront loading the net profit growth, which has outpaced revenue growth in the last couple of years, we front-loading it such that the weighted average is still up to 5 percentage points. The answer is no, we are not upfront loading it. We had 2 strong years and first half of this year is very strong, but we -- remaining time spent until 2029, we expect net profit to continue to outpace revenue by up to 5 percentage points per our 5-year plan. And hopefully, we can do even better than that.

So on that note, we will take your questions, and we will first open the floor to those who are here with us at ST Engineering hub, and then we will switch over to those who join us virtually. Thank you.

Thank you, Vincent. Our analysts and media online, please raise you hand -- please click the raise your hand icon and we will place you in the queue. For members and participants here, please do remember to state your name and the organization you are from before you ask your question.

We have the first question, please.

This is Rachel from UBS. Congratulations on the strong first half sale results. I have a couple of questions. One for Lee Chew, one for Jeffrey, one for Mervyn and one for Cedric. Sorry, Vincent, you don't have a question.

So first question would be to Cedric. So last year, you said -- last year, you delivered orders of close to $19 billion. So when -- I guess it's also for Vincent. So when you say that the order wins are expected to be as robust as 2025, can I confirm that you expect your order wins to be something along the lines of like $20 billion or plus?

Well, I mean, as robust as '25 means at that level that we displayed in 2025, which was a very healthy level, as you already mentioned, it was $18.7 billion, I think. We expect the full year new contract wins to be circa in that region. Yes, so we didn't give other figures. So [indiscernible] which will be very strong and there are potential upsides, as I mentioned. But we will see how the year pans out because we are still not near the end of the year yet. So maybe in third quarter, when we finished the third quarter, we have a market update at that time. We will give you another update on our outlook for the rest of the year.

I was just trying my luck. Okay. And I guess to Jeffrey, I know that Cedric mentioned in his second sentence that there was a scale effect as well as a strong operating leverage. Maybe could you elaborate on how you achieve these productivity gains? And were they concentrated in a single segment?

To Mervyn, could you update us on where you are in terms of your international defense business? Also, outside of IBD, where are you seeing the biggest demand?

And finally, for Lee Chew. For USS, we saw this huge swing in profitability and EBIT basis. So how much of this would you attribute to the Satcom segment? And the Nick, sorry, yes, how much of this would you attribute to the Satcom segment? And could you elaborate a bit more on how the -- how the EBIT will run -- will trend towards profitability. That means what do you expect will drive your EBIT on Satcom from a loss to a breakeven or even profit in '27?

Okay. Thanks for the very comprehensive set of questions. But first, before I hand over to Jeff, productivity gains were achieved across the group not just limited to Commercial Aerospace. As you also heard, just in Satcom alone, we have achieved or we have captured annualized savings of $63 million as of the end of first half [indiscernible] going arsogoing forward, those will come through. But productivity gains apply across the group, but we can let Jeff talk about the effects for our commercial aerospace.

And then -- after that, we will have Mervyn talk about international defense business where we are and what's the biggest demand outside of international defense. There are a lot going well for us. including the digital business, as we mentioned, especially with the growth in AI, AI analytics, which is very encouraging.

And then finally, Lee Chew will give you share insights on USS, URS as well as urban solutions as well as Satcom, which are both doing well.

Okay. So maybe Jeff will start with you.

Well, we are very fortunate to operate with a backdrop of steady long-term growth in the [indiscernible] vision industry. And so we have been continually investing both in capability and capacity. So if you look at our very diverse geographic footprint and capabilities today. And you see how we are adding on new capabilities. For example, in the 350, A350, 320 new capabilities across engines, airframe and components. That gives us a lot of scale synergy and product synergy that we can increase and improve productivity on. At the same time, if you look at our capacity growth, as we speak, we continue to build new capacity in engine overhaul in Singapore, new airframe maintenance capacity in Singapore, in China and in the U.S. So we're not slowing down in terms of how we're building capability and capacity across the network.

In addition, with the productivity focus that we have that Vincent spoke about and how we are implementing increasing AI enable equipment and also tooling up our workforce we do expect to continue to grow with the market growth.

So to add on to Jeff's point, across the group, our procurement and productivity savings in first half alone is well above $150 million. If you recall, every year, we target $200 million. And I've mentioned that year-on-year, year after year, we continue to outperform that target. And the first half of this year is more than $150 million. I'm just being a bit conservative, actually, it's well above $150 million in savings alone which help us to be more efficient and more competitive in the way we go out competing for new businesses, which is an important attribute for us to win in the marketplace. Our costs must be competitive. We must continue to look at lean operations, making sure that our processes are efficient and productive.

Thanks, Jeff. Mervyn, please.

Thank you very much for your question, Rachel. Well, I will start the comments on the international defense front, right? And I start by referring you back to the first quarter where we highlighted the slide, which Vincent mentioned, where we showed you a pipeline of approximately USD 11 billion of opportunities now in the next 15 to 20 months. And I would like to reiterate that those opportunities continue to be intact. And in fact, I cannot go into the details, but some of those opportunities, we are in a quite intense negotiation right now. So we are quite confident that some of this pipeline eventually will turn into new wins for us.

But I just want to pivot from there to talk about the other opportunities that we see in the international market. not least our counter drone business, which saw us entering into a very exciting new market for us on the international front, where we see strong demand especially given recent conflicts that we saw in the Middle East where Air Defense, counter-drone capabilities come to the [indiscernible]. And as we highlighted previously, we have won several international contracts on that front in the Asia Pacific region. We offer quite a range of the capabilities on that front ranging from detection capabilities, command and control capabilities and stitching and ending with, of course, interventions, both kinetic as well as nongenetic response. And we find that this is a market that is likely to scale in the future, given the challenges that sovereign nations face on that front. And I think a lot of the defense budget will go into that space.

So now that we have had a foothold into that interesting market we are very optimistic that this will gain momentum in the near future. People think from counter-drone. I'd like to talk about our [ munitions ] business especially on the 155 mm and 40 mm front, we have seen repeat customers for our 40 mm, as well as new customers. The U.K. is one of the examples that we just won in the July -- and then Czech Republic also is a repeat customer that was also reported in the July time frame. And I can't share too much details right now, but potentially, there will continue to be even more and more significant munitions sales in the near future, which goes back to the point that Cedric as well as Vincent made that we are confident about our third quarter as well as fourth quarter for this year. A big part of it is driven by opportunities on the nation's front. I hope I responded well to your question on international defense.

And now I want to pivot to discussing opportunities beyond international defense. We see huge demand, as Vincent highlighted earlier on the digital solutions business. And a big part of that comes from the demand from our AI analytics as well as cybersecurity needs of customers as well as on our data center and GPU infrastructure business. And when we talk about the demand, not just on the government front, but also commercial, not just local but also on the international front.

As more companies and governments push towards greater digitalization as well as having greater demand for AI infused solutions, I think we are well positioned as Vincent highlighted that this is a growth area, and we are quite glad that we have started our investments into building the capabilities and capacity for this space much earlier before the demand picked up. And therefore, we are now able to write the tailwind of some of these demands that are coming in.

Also I'd like to highlight that we also go beyond the Defense business in Singapore. There's strong demand from the public security and safety sector as well. Governments, including the home team, there's huge demand for our products. And you will have seen some of those reports of our wins over the last few months on that front. But a big part of it is really the demand for more digitalization of the solutions. And as I said earlier, we are well positioned to capitalize on this new wave of demand that is coming in. So those are the areas beyond international defense that we are quite confident of being able to write that wave that is there. Thank you.

So [indiscernible] the USS EBIT improving that we [indiscernible] contributed both by URS, Urban Solutions as well as Satcom. Having said that, the question around Satcom, let me just give some perspective there. We have been updating that since the beginning of the year, we've initiated a series of activities to manage costs. And you heard from Cedric earlier that the plan to have annualized savings of $63 million was completed at the end of first half.

Obviously, the positive impact of the cost initiatives, which we implemented from Q1 also was felt in the first half set of results. The lower depreciation and amortization expense that arose from our impairment of iDirect in September of 2025 also accounted for the improvement that you saw in a year-on-year compare there.

The other question around how do we look at that momentum and how do we continue to build towards a positive EBIT in 2027. The annualized savings that we talk about from the cost initiatives will support that target as we go into -- as we execute the remaining of second half and as we go into 2027.

We are also seeing good momentum in the adoption of INTUITION. We have been releasing some announcements pertaining to defense and common contracts, which Cedric also alluded to, it might not be that well known, but we do have a very strong track record in our satellite communications capabilities as it relates to EU nations and NATO member states. So 20 of the 27 EU nations actually are served by ST Engineering iDirect comps solution and 24 of the 32 NATO member states use the communication -- the secure communications devices from iDirect as well.

So we saw that in Q2, the continued investment to enhance secure and resilient comps capabilities is front and center for Europe as well as for Asia. We look at our robust pipeline and that obviously also underscores our confidence as we look at turning around not just EBIT from cost, but also growth in revenue. So more and more, we are seeing customers resonating with standard space, the interoperability, secure comps that we are putting forward. But even on the commercial side, they are seeing the resilience that comes with multiple waveforms that we support multiple orbits that our technology and platform supports.

Thank you, Rachel, for your questions, yes. Okay, we'll get a second question, and I will make sure everyone has time and then to ask your questions. We'll answer a second question, then we'll go online and we'll come back to the fiscal meeting arena, if it's okay with you guys. Please.

Thank you so much. Congrats on the results. This is Meg from CGS. So I have 3 questions. One on Commercial Aerospace. Thank you, Jeffrey, for the color on the productivity savings. But we also hear from you on the product mix changes as well in first half how has this mix changed? And how do you see that progressing into the second half?

And then my second question on the order wins. So again, just following up on the previous question. So if we -- assuming even if we are flat year-on-year, so that implies about 11 billion order wins into the second half or a roughly $5 billion-ish win per quarter. Is that the right way to understand there could be lumpiness, but is that the right way to think about it? And which segments are you like -- just trying to understand where is this confidence year-on-year like because I think we were previously at 4.5, 4.9 rate and now to going above 5, where is the confidence coming in from?

And thirdly, on USS. So given that we've achieved the $63 million annualized run rate, and we've gotten the EBIT at about $46 million for first half. So is it fair to say that the second half could be stronger on the back of completion of these cost savings?

Yes. Well, I think we can answer in the reverse order. We get Lee Chew to talk about the savings. And we already said that second half for USS will be stronger than first half. I'll give -- let Lee Chew give more color on that. And then we will save Jeff for the last in terms of product mix and how they look at Commercial Aerospace going to the second half.

Now other wins -- we didn't say flat year-on-year. We say it will be as robust as 2025, and there may even be a potential upside on the timing of some of the programs. Where is the confidence coming from? The confidence stems from the fact that we are in 3 growth structurally growing segments that has long-term good growth traction, be it in Defense and Public Security, Commercial Aerospace or Urban Solutions and Satcom. As I said in my opening remarks, these are structural demand that will -- that underpins our confidence and our track record in securing growth, delivering growth, profitable growth gives us even more confidence that the years ahead will continue to be very positive. And if you just look at our track record in terms of new order wins, order book despite the quarterly ebbs and flows are trending in the right direction.

In the northeast direction when it comes to order book and new order wins, northeast. And when it comes to cost, it's going in the southeast direction OpEx over revenue and that's -- these are signs of businesses -- business that is very well run and well executed. And it's not over 1 year, but over many years, over business cycles, even during the toughest time of COVID pandemic we deliver resilient results because of the discipline that we apply in execution, investments, making sure that it gives us good returns from our investments and also making sure that we do continuous improvements, efficiency, productivity, and we have also been very candid to the market when we see headwinds and challenges we talk about it. And we see [indiscernible] we also share with you.

Keep in mind that business cycles will keep coming in and out, but our resolve and our focus on delivering sustainable growth remains unchanged. And we'll stand us in good state in the years ahead. So it's a more elaborate answer than what you're expecting probably. But keep in mind that we remain very confident that the order wins will continue to be robust not just second half, but also going into 2027 because of the universe of opportunities that we are addressing as a group across 3 segments, all 3 segments.

Yes. Maybe I can just hand over to Jeff to talk about [indiscernible].

I'll be short and sweet. We have many multiple products and market segments. I would say all segments are holding steady with some segments actually doing very well. If you look at the engine MRO market where the [ CFM56 ] engine has not peaked in shop visits, expecting to peak in 2028. And with the LEAP engine ramping up very quickly, you can see a huge amount of growth in that area. And our [ nacelle ] deliveries, steadily following the OEM deliveries, which continued to grow despite continuing supply chain challenges, it's continuing to grow and addressing some of these challenges head on. So these are 2 key drivers of our product growth market.

Meg, I hope we've addressed your questions for now. Maybe we'll take a question online. Yes.

Luis from Citi has a question.

Just 2 questions from me. EBIT margins for the half, once more quite strong and strengthening. Just wanted to get a sense of whether you expect EBIT margins for the group to continue to improve? And if so, which divisions would be leading the improvement?

Second question is more of a housekeeping one. As Cedric mentioned that DPS International wins are more than doubling this year from last year. Could you give us a level of -- or the international order wins last year?

So Luis, just to confirm, you wanted to know how much was the order win for international defense in 2025?

Correct. Yes. When that's going to more than double. For first half, it's $1.2 billion, but just wondering what level it's doubling to this year.

For the full year of 2025, we secured more than $600 million worth of international defense wins. And I think earlier this year, we said that we target to double that for 2026 as of midpoint of '26 we already doubled and we expect in the next 2 quarters, more upsides to come as we mentioned. I hope that address your question on the international defense wins.

And as I -- as Mervyn and I both mentioned, the pipeline remains robust and intact. And we are going after every opportunity that is addressable by us. And then EBIT margin will continue to strengthen. If you think about the -- what I've mentioned earlier, that we think we are confident that net profit -- a growth CAGR will continue to outpace revenue growth CAGR. So from that standpoint, margins will continue to strengthen and it's going to be generally so because our 3 segments are all targeting for stronger performance in the 5 years that we planned from through 2029. Of course, at the right time, we'll published another set of 5-year plan. But for now, the current 5-year plan talked about our 2029 targets. And we expect margins to continue to strengthen.

For the various reasons that we talked about, we have more scale, our margin and project mix that we can see is going to support that. And we also have productivity savings that we expect to come our way. We expect our cash flow to be strong and which also drives reduced lower interest costs, which we talk about. And we also had another point where we say in the 5-year horizon, we expect the amortization of intangible assets to continue to come lower in that 5-year range. So hopefully, that answers your question on EBIT margin profile Luis.

We also have a question from [ Roy ] [indiscernible].

Congrats on the very strong results. I have 2 questions. Yes. Sorry, yes, 2 questions. First, I think one question was not answered just now was regarding the color for the USS second half outlook. I understand the revenue growth is guided to be higher, potentially, these are from both Urban Solutions and the Satcom business. So could you please elaborate where -- for the Urban Solutions growth, where does it come from? That's the first question.

The second question is for Jeffrey. Could you please remind us regarding your capacity expansion growth rate in the next few years and the current utilization in terms of the booking of the [ hunger ] slots and also the engine workshops lots, yes? So these are the 2 questions.

Okay. So I'll let Jeff answer the question. But for USS, we talked about second half expecting -- we are expecting second half to be stronger. As you asked about URS, I think some quarters ago, we talked about our major projects for mobility that will kick into full gear and that's one contributing factor for our URS business to be gaining strength in the next few years.

But I'll let maybe start -- Lee Chew start the discussion going, yes. Lee Chew, please.

Yes. Okay. Let me just comment on the USS second half performance. I know Vincent has said that, maybe Roy wanted to hear it from me. Second half is expected to be stronger than the first half, both in revenue as well as in EBIT. And we did say in the slides that we are targeting Q4 EBIT to be positive for Satcom. So in totality, as we look at USS, it's typically second half weighted and that is supporting the claims and also our confidence that we will deliver both on the EBIT and revenue front, a stronger second half versus what you are seeing in this first half results.

The question around what is shoring up the URS revenue. So I would say that we are delivering against a very strong order book, which we talked about last quarter as well. I think last quarter, we said that our order book is more than 4.5x of our 2025 revenue. And obviously, at that time, it excluded the NJTA into the order book itself. And part of our focus in Urban Solutions is ensuring that we execute well for the contracts that we have on from the customers. And in the Urban Solutions portfolio, as you know, it comprises of Mobility, Smart Mobility, both road and rail. It also has the smart utilities and infrastructure. We have projects globally, ranging from the Middle East to the U.S. to Asia, and our confidence in delivering a stronger second half comes from the fact that we are executing to each of these projects diligently.

We announced a $840 million win with the [ Taoyuan Brown Line ] project. We also said that work will commence in Q4. So we know that as we continue to win these new orders, and as we execute the projects in line with the customer's time line, these will give us visibility to our strength in the revenue that will convert. So hopefully, that answers your question, Roy.

Well, we come back to the -- thanks, Roy, for your questions. I mean we come back to the location, ST Engineering hub, and we maybe invite Lorraine to ask the questions. Lorraine, please?

I think was there still a question for Jeff.

Across the MRO network, we are achieving close to 90% utilization today. And if I look at the capacity expansion, over the next 18 months, I would estimate we are targeting around close to 20% capacity expansion across the MRO network.

Okay. Lorraine.

Yes. So with the -- Lorraine Tan from Morningstar. With the operating cash flow looking better I'm just wondering whether the group is looking at how they will allocate any excess cash going forward? Are there opportunities for bolt-on acquisitions or other such acquisitions? Are there [ HAPS ] gaps that would help make securing the $11 billion pipeline more achievable or more specific. Just wondering if you can provide a little bit more on that.

Yes, we will -- maybe I'll let Cedric talk about it, but how to put it. We have a very strong balance sheet and we have very good access to capital when we need them when the opportunities come. There's no limit or no constraint today in our ability to capture the opportunities that are out there, including the pipeline of international defense opportunities, the USD 11 billion that you mentioned, there's no constraint today. But of course, a very strong operating cash flow gives us much more flexibility. Well I invite Cedric to help us to share more on this topic.

Yes. I mean, as I said, when we have excess cash, first order of business is fulfill our dividend promise, right? So we have a very clear dividend policy. We'll allocate it to that. Then what remains is, can I pay down my debt or can I reinvest for growth? Now this is a question where if you have a very fixed target, you kind of deny yourself an opportunity to consider growth, right? So every growth opportunity has different attributes, even if it's an M&A, is it valued correctly? Is it a strategic fit? Do we have a right to play? How short term is the payback? Cultural issues. There's so many things to be considered.

So I would say that we are always open to opportunities not just to reinvest, but also to divest as we have done 20 businesses in the last few years so that we get into higher quality revenue, higher quality earnings, as Vincent described, right, where we have the right to play and right to scale. I think that's perhaps have been our focus.

As Vincent said also, we have access to short-term capital. We have a U.S. commercial paper program, which is very competitive, very liquid. In fact, we are only one -- the only industrial company in Singapore that has a U.S. dollar commercial paper program. We also have a lot of access to long-term funds. We have rated AAA for our bond issue, AAA. I don't think you can -- I think we have a good access to very competitive financing. So that definitely is not a constraint. Even if we use up the cash, we still have access for further growth if we choose to do so, yes. But every growth opportunity must be done with discipline, very careful and clear cavity of strategic thought and also into areas where we see growth and we have a right to play.

I think fortunately, just to jump in on some of the questions that were asked, we are in the right sectors. AI, something we have done in terms of machine learning for many, many years, especially in the defense business. Modern defense, man unmanned teaming. We have demonstrated that at our Air Show. And recently, we have won 2 international counter-drone facilities.

And in terms of urbanization, as you have seen in Taiwan, we have won so many contracts, thanks to Lee Chew and team. International Defense, strong tailwinds. Commercial aerospace is structurally growing both from an OEM production rate as well as MRO because aircraft are used for longer, so are engines. So there are a lot of tailwinds here and hence, our confidence to give you the numbers we have in the 5-year plan. And now we're telling you many areas are ahead of that 5-year plan.

And the 5-year plan excludes M&A and when the right opportunities come our way, we do have the ability to capture them through acquisition if needed. So we are constantly looking at acquisition opportunities. We must make sure that the acquisition opportunities are in line with our strategy and that they give us the required returns or if they meet certain strategic objectives. And if they all meet the attributes or deliver those attributes, then we will certainly have the capacity to go after them or capture them.

So Lorraine, I Hope we've addressed your questions or do you have further questions at this time. Okay. Maybe we get -- do you have a question, Jason? No. Yes. And then after that, we go to Paul.

I just have 3 short questions. So first one is for Jeffrey. I wanted to get a bit more color on commercial [indiscernible] margin. So I understand that you really covered productivity and the product mix, but there's been a little -- there's no mention at all on pricing. Maybe if you could share how pricing has been trending over the past few quarters and it has actually contributed to margin expansion?

Second question is for Lee Chew. Thank you for sharing the milestones that is required for the Satcom business to turn a positive EBIT. But I wanted to get a sense of, as you look at the business over the medium term, what kind of EBIT margin do you think can be sustainable given that the commercial landscape still remains relatively challenging to say the least.

Yes. And last question is for Mervyn. So I mean, can you maybe share some of the key lessons that you have taken from the recent U.S. Iran conflict. How do they differ from other recent conflicts? And maybe have these developments change your views on which capabilities will be the most relevant? And if traditional platforms could slowly become slightly less relevant?

Okay. Well, it's an interesting question. I'll let Mervyn address but we are well positioned with the portfolio of products that we have in the defense space that we can say. Then maybe we start with Commercial Aerospace on margin and then the effects of pricing. And then a follow-up by Lee Chew on the Satcom question regarding Satcom EBIT margin. Jeff?

So Commercial Aerospace, we operate in a very competitive global market. So our contracts are with major airlines and lessors, and we compete directly with sizable global players. So the market pricing continues to be highly competitive in a situation of bid to win or bid to lose bid and lose. So I would say that in terms of margin expansion is driven primarily by product mix. And of course, [indiscernible] has mentioned a lot about our scale efficiency as well as our productivity initiatives. All this contribute to our margin expansion.

And if you recall, we were working towards a double-digit EBIT margin for commercial aerospace. And in the first half of this year, we've actually achieved that thanks to the support of our customers. And we endeavor to continue to address and to grow our ability to be profitable. Thank you.

Thank you, Jeff. We'll go to Lee Chew, please.

Yes, Jason. So I think beyond taking the business profitable, which is obviously top of mind. We, as an organization, will need to stay a job to continue to drive up profitability. And the reason why I say that is if you follow the path that we have taken not just from a technology standpoint in rolling out intuition, both at the core at the edge, the software-defined modems the [indiscernible] site, which is a [ singerpane ] of glass for both network and service management.

We've also gone out to market to say we will be offering as a service. So INTUITION and [indiscernible] is a new business model that we have introduced to the market. And we believe that business model will open up markets that have not typically or traditionally been our Satcom customers. So it's not an easy answer -- it's not an easy question to answer because we need to see how the market will continue to evolve. As our customers, our satellite operators, regional as well as international works their strategy of competing with the vertically integrated providers. But we do know that the strategy of having standard space the strategy of having a platform that is multi-orbit, more dams that will not lock in customers because they only need one hardware now and it's not dependent what kind of wave forms they need to operate in their environment. Those are elements of our strategy that would give us inroads, not just into the existing installed base that we are servicing, but also potentially new customer base.

So with scale, profitability will also improve and come. So I guess, maybe I will say that we're working all the different pipes. We believe that, that is the right path to get us to not just profitable business, but to an improved profitability, and we'll update you as we progress.

All right. Thanks, Lee Chew. Mervyn?

Thank you very much, Jason, for your question. On the issue of key lessons of the Iran conflict, what capabilities are using more relevant these days. I think the one that strikes quite clearly to move observers of the Iran war is that the ad defense capability, especially the counter-drone space, probably is top of mind.

If I go beyond the Iran conflict to also look at the Ukraine war, the use of drones and drone warfare as an offensive weapon redefines air power in terms of being able to deliver capabilities from the Sky that are a lot more cost effective and quite asymmetry in terms of [indiscernible] in terms of the targets that they are impacting and influencing the outcomes on the battlefield. So I spoke about the counter-drone capability that we have built and which we have entered into a new market.

So I think we're well positioned because of the new demand that come from observations of the Iran war, where air defense capabilities no longer are defined by expensive ground-based air defense solutions, missiles, et cetera, against traditional air power threats, but rather much more lighter and more flexible counter-drone solutions that can be offered by primes like ourselves as well as start-ups. That's why we're also working with startups and looking at how we can integrate some of their capabilities in the full suite of offerings that will form part of our counter-drone package that we will be able to market to our customers. And so far, we have got successes on that front.

On the drone warfare bid, the offensive bid, you also know that we have started to go beyond just medium-sized drones to much smaller drones that can be operated by the soldier in the battlefield, [indiscernible] as well as [ Atos ] series of small drones that already see some local use is also something that we are promoting for overseas customers as well. So I would say that the drone warfare is one of the very obvious key lessons from the capability standpoint that step up from the recent conflict in Iran and Ukraine.

The other is actually in the digital space, right? The warfare on the battle field these days, I think it's a lot more complex compared to the past. And therefore, having that situational awareness of what's going on and being able to make the right decisions, command and controlling your forces on the ground is also an important aspect of what we see as a lesson learned from the Iran conflict. And again, I think our business in ST Engineering is well positioned to write the tailwind from this demand. Our AI-enabled insights from our combined control solutions that we provide to our customers, allow for the data analytics that is not possible in the past.

So that some of these insights that can be -- that come up from the analytics will allow the commanders on the ground to make better decisions, decisions that they couldn't have been able to make without their AI-enabled capabilities to enable cognitive abilities of our commanders beyond that was traditionally humanly possible.

Situational awareness using satellites is another area that we see as important. And that goes to our satellite business, especially observation satellites as well as Lee Chew's business in terms of satellite communications, connectivity, no point being able to do the observation about not being able to communicate to your forces at the edge to act on those situational awareness and knowledge. So I would imagine that the space arena is becoming more and more critical, both -- and that's a tailwind for us in terms of our ability to build more observation settlers as well as satellite communication connectivity, the hubs and modems that will allow for the information to be passed down to the forces at the edge.

There is a tendency to think of [ ARMOR ] capabilities as being less relevant in the future. But from what you see in Ukraine, the both sides continue to use armor forces in order to move trips around. So we -- our own observation is that armor continues to be relevant, especially armored fighting vehicles, that is able to carry troops on the ground because ultimately, it is the forces on the ground that will cover the area that you that you win and you want to be able to move these forces in a protected manner quickly across the battlefield and armored fighting vehicles are the way to do so, whether it's tracked or wield and which is the reason why we do see quite a significant amount of demand for our armored fighting vehicle solutions, both in Europe as well as in the Middle East.

Another area I would like to talk about, not so much capability per se, but rather the recognition that in order to fight a war of extended length especially the attrition warfare that you're seeing in Ukraine relies a lot on your ability to have your own indigenous supply chain, right? Because a lot of that capability in order to sustain a long -- prolonged war requires you to build that industrial capability within your own sovereign nation so that you don't have to depend on others and that's something that we saw in Ukraine. And that's something that you also see in Iran warfare, especially when demand for air defense capabilities are depleted at a rapid rate in -- for the countries that are being attacked, right?

So we do see that as an opportunity as well because a lot of the Middle East as well as Eastern European countries where the industrial defense base is not as mature, that's where they are looking at building up their local capabilities, and we are well positioned to be able to leverage that new demand that comes from them because we are always -- our strategy where we look at international customers is that we like to partner the local industry so that we are able to sort of share some of our technology so that they can also build up some of the indigenous capability, which is desired now and a key lesson learned from the recent conflict where your supply chain resilience is core. That positions us well because our strategy is really to work with the local partners, to build out their capability, create good jobs for their people, which is political interest to their leaders on top of building capabilities and selling that capabilities that we have in Singapore.

So I would say that the lessons that we see in recent conflicts all give us that confidence that we are putting our emphasis in the right areas, especially in our strategy towards reaching out on the international defense market front. I hope I answered your question.

Thank you. Maybe we go to Paul now.

[indiscernible] stand so long. Just 2 accounting questions. There was a bit of a swing in the translation losses first half last year and first half this year. Maybe a trouble said just a bit of explanation. And also the decline in amortization was it related to just either [indiscernible]

Okay. We can -- Cedric.

As I pointed out, the U.S. dollar did weaken if you look at the average weight in '26 versus first half '26 versus '25%. And therefore, at the revenue level, when you translate U.S. dollar to Sing, you have a smaller Sing dollar. So it does affect us. In fact, at the group level, if you take into weakening U.S. dollar into account, our growth is actually higher than 11% or 14%. It's more than 15.5%.

So there's some effect on that. But in terms of hedging, in terms of cash flow hedges, we have always have a very good hedging policy to look at whether we are net long or short a certain currency. So in U.S. dollar, for example, we are net long U.S. dollars. So we will sell U.S. dollar forward. So that will have much less impact on because we protect our margin by doing it this way in a wet manner, actually. So that's one.

So I would say the currency impact is not great, but it does have some minor impact on the top line for us because of a weakening U.S. dollar. Then on the amortization, yes, iDirect is one of them with some impact. But of course, as you have CapEx in the past, you would also have amortization that's involved, anything that is capitalized. So that -- basically, I think CapEx-wise, we are looking somewhere in order for the full year of '26, something like $500 million, $600 million, which will include right of new assets which are basically leases, but now classified as on the balance sheet, as I said. So those will also be -- those are the ballpark numbers.

Of course, if it does grow higher than that means that we have unforeseen investment opportunities, [indiscernible] asked just now, and we will do so with great discipline and we have great IRR. So even if it go up, it should be a good thing.

Just a quick follow up. So that the translation loss to gain that flows through the P&L?

The true impact, right? I mean one is that -- as I said, the revenue side, it does hit, but we don't hedge that. But on the net long let short side in terms of your revenue and cost mismatch, right, in particular currency. So for example, we collect more U.S. dollars than we spent U.S. dollar then we are long U.S. dollar. So if we don't hedge this by buying it forward at a fixed rate, then our margins will be affected. So that we hedge.

But even if we hedge, we don't hedge 100% and forever the lag of the contract. We hedge in a wedge manner. So in the first 6 months, we'll try to be hedged about 80% to 100%. In the next 6 months, we will try to be hedged 60% to 80% and so forth. So there are some parts that are still not hedged, and therefore, there will be some impact on the EBIT as well. But it'll be much minimized compared to a nonhedged position. I hope I answered.

Thank you, Paul. Any other questions? Yes.

Two, a quick follow-up on order book and margin. Another one for International Defense. Firstly, for the order book, can we have a breakdown of order book by segments so that we can assess the order duration and capacity tightness for each segment.

And second question is for Commercial Aerospace MRO. The margin for engine, can we understand the margin for engine is higher than airframe so that may -- our expansion on the capacity for engine MRO could drive the margin expansion further.

And thirdly, for International Defense segment, what's our key competitiveness. Yes, we understand that we have partnership with local partners to do local production. Besides that, what measure we plan to do to penetrate more new markets like hire more international background, people to penetrate new markets or we have more ample capacity compared with those European or Middle Eastern competitors or our key products like Bronco or [ Terex ] is more competitive with our product -- our competitors' products.

Well, so thanks, Herbert, for -- first of all, for attending our earnings review for the first time. Welcome. So thanks for your questions. We don't -- you have 3 sections on order book by segments. And then you have margins on engine MRO versus airframe MRO and International Defense, our key competitiveness.

Now I'll let Mervyn talk about this because we do have a very unique differentiating attributes when it comes to international defense. Mervyn talked a little bit about it. We partner with strong local partners. That's a very important attribute. We do local production in partnership with a local partner, where possible to create the job opportunities and retaining the industrial capabilities. We also share intellectual properties, which are important aspect of having self-reliance and resilience for the country that we work with. So I'll let Mervyn talk a little bit more.

Now order book, we do not disclose by segment. But suffice to say that all 3 segments have robust order book. The one time that we give more example actually in the first quarter of this year, we said that U.S. order book is more than 4.5x 2025 revenue. So book-to-bill is more than 4.5x. And if you add the NJTA contract of $1.7 billion that we added to the order book in end of second quarter, plus the brown line for Taiwan of $840 million that we secured in third quarter, not yet in our order book. you can see that the order book for USS alone is already very robust.

So we kind of like you can do the calculation and math on what that order book is. But we do not disclose by segment at this time. suffice to say all 3 are at a very robust level.

So with that, I will hand over to Jeff to talk about the MRO margin situation.

Well, it's a difficult question only because we have different product mix, different geography, different contract types. So my straight answer is the margins are similar.

Well, thank you very bit for your question, and welcome. First time here, right? Yes, I don't know where to start because I think in terms of key competitive advantage, we have quite a fair bit, right? I spoke about partnering the local partners that are there and all those advantages in terms of being able to provide good jobs, being able to leverage on their networks, being able to help them in their ambition towards being supply chain resilient. Those are factors that are important considerations for international defense sales.

But on top of that, actually, some of these markets where they have a less mature industrial defense base is where also we find cheaper labor and lower cost in terms of some of the materials that we need for our manufacturing because they're closer to source, right? So cost effectiveness is probably one of our key competitive advantage.

The other is in terms of performance of our platforms and solutions. I would always like to highlight our Bronco solution that you mentioned, Herbert, right? And it is actually one of the most capable platforms, tracked vehicle that can provide that combat service support requirements for many militaries. And if you look at the literature, there's really not many competitors out there in terms of the kind of performance that can be provided by our Bronco platform. I can [indiscernible] invest in one hand the kind of competitors that we have on that front, which is the reason why we -- there's a lot of demand and interest in the Bronco platform that we're offering.

Even on the maritime arena, in terms of performance, one of the key characteristic of our products is the fact that we are able to and quite a significant capability in the water with a very small number of crew. And a big part of that is the special design that we have, incorporating a lot of technology into our solution because in Singapore, we have a very small population. So in terms of the number of sellers, [indiscernible] as well as soldiers, we have much smaller numbers compared to European countries and in the Middle East for example.

And some of the Eastern European countries like Estonia, Lithuania, they also don't have a large population and some of the Middle Eastern countries, like Qatar, for example, they don't have a lot -- a big local population, too, right? So some of that design, there is a lot more economic, which we leverage a lot of technology in order to reduce the crewing requirements actually appeals to some of these customers that have similar constraints by us in terms of manpower resource. So I spoke about cost. I spoke about performance.

Finally, I want to talk about capacity, right? Because of the war that you see in Europe and Ukraine, actually, a lot of the countries that supported Ukraine are trying to replenish their own defense capacity to levels that were before the Ukraine wall. I would say to levels that were even higher than before the Ukraine war because the realization is that post World War II, they have enjoyed their [indiscernible] dividend and have reduced in terms of their investment in defense but those have gone up significantly. So many of these countries are trying to replenish themselves to levels even higher than before the Ukraine war.

And many of them are losing their own local industry in order to provide that resupply of leveling up of numbers to levels higher than even by the Ukraine war. And that creates an opportunity for us, which is the reason why in many of the competition that we see one of the value proposition for us is that we are able to meet their demand schedule at a much faster pace. Why? Because a lot of the other traditional competitors, they have capacity constraints because they are replenishing their own country to levels higher than before. At the same time, there's quite a lot of orders that they have received because there's overall increase in defense spending and overall demand. And that creates the opportunity for us to add a new proposition, which is that we are able to meet the demand schedule of the customer. So whether in terms of cost, whether in terms of performance, whether in terms of capacity, I would say all 3 are part of our competitive advantage.

The final one is really the post-sale support that we provide. The very fact that we are able to win the MRO in Qatar and MRO is Maintenance Repair and Overhaul Services is really a post-sales capability that we provide to our customers, right? And that requires quite a significant about of -- a bit of engineering competencies, our design in terms of past provisioning, our design in terms of the technical workshop, our ability to help to manage and make sure that even after we sell you the platform, the availability as well as the serviceability of the platforms continue to be very strong even after years of operations. And that also is a strength of ours and together with the other 3 attributes that I mentioned earlier, put us in a good position to be able to have that strong pipeline, hopefully, to convert into wins in the near future.

So over -- thank you, Mervyn. Overarchingly, Singapore also has a very strong brand name, trusted brand name. We have a legacy or heritage of 6 decades of strategic partnership with the Singapore Armed Forces. That gives us good brand awareness and good brand strength as we address the international market. thanks, of course, to our very important customers enter Singapore military, Singapore Armed Forces and the military of the Ministry of Defense. So all that work together that make us very competitive in the international arena for defense competition or other defense product competition, defense projects.

Maybe we let -- we ask one -- I have one final question in the room before we adjourn the meeting. Any other questions at this time? I know there are no more questions online as I understand. Go ahead.

Want to squeeze in one. I think generally, you give one slide on the overall capital management, which I didn't see in the slide deck. If you can just quickly highlight on your capital management, especially with lower growth targets that you have?

Please go ahead.

Yes. The -- because of our strong cash flow, our total debt has come down we are now at our end first half '26, we are at about $4.7 billion. And our weighted average financing cost is about 3.4%, 3.5%, so which is very healthy. That tower is all quite well spread out. And as I said, we have very good access to short-term funds in terms of the U.S. commercial paper and the bond market because we are rated AAA, so in good hands, basically.

There was an [ MTN ] that was due in May this year because of the interest rate environment, we decided to defer that but on the other hand, because we have access to U.S. commercial paper, a very large program size, we can use it to reach it, in fact, at lower cost. But of course, it's a shorter tenor alone, but it's at a lower cost than if we had compared to if we had issued the bond at that point in time.

Do you see the debt level -- I mean, overall, the debt metrics gearing, et cetera, to be at this level? Or do you think it can go down.

Yes. Again, it depends on -- I mean, dividend we will fit fully back it up. It depends on investment opportunity, right? So if we do invest, then, of course, we are not shy to tap on the facility. But just to state right now, we are not looking at anything large investment in the likes of TransCore and things like that. That's not [indiscernible] right now. But we -- it behooves us to always look at good investment opportunities because we won this trajectory to go well beyond '29, '39, '49, right? That's also why we invest in R&D conscientiously. So it depends on that.

But barring that, then, of course, our strong cash flow will allow us to reduce debt. So we can see improved metrics going forward, especially our debt over EBITDA has improved, if you can look at it over the year significantly.

Yes. And of course, our strong balance sheet and cash flow gives us -- gives us a lot of flexibility. Investing cash in the business gives us good returns. And just last year alone and the base operating performance level, our return on capital employed is 11%, very strong. So if there are good growth opportunities for us to invest our cash we will have the ability to do so. Or if the best disposition is to pay down debt, we will also do so, but it gives us a lot of flexibility after paying dividend to our shareholders. So that is a commitment.

Access to debt, actually, in some cases, not in an excessive way we'll reduce the weighted average cost of capital. And therefore, generate even higher economic value add. So -- and avoid -- and this leverage provider always is not in excess, helps the return on equity. And last year, our ROE is something 28% and we believe this year will be higher than 28.7% return on equity.

Okay. Well, on that note, we will now adjourn the meeting. I want to thank all of you for being here, and thank you for your active participation in today's results briefing. And for those of you who join us online, thank you very much. We'll talk for next time. Thank you.

Good morning. Welcome to ST Engineering's Full Year 2025 Results Briefing. We will begin with a presentation by our Group CFO, Cedric Foo; our Group President and CEO, Vincent Chong, will then give his remarks. After that, we will end today's session with a Q&A from the analysts. Without further ado, may I invite Cedric to give his presentation, please.

Yes. Thank you. First of all, welcome to ST Engineering's Full Year 2025 Results Briefing. Good morning to all participants, whether you are in person here or via the webcast. Slide 2. Before I begin, I would like to bring your attention to Slide #2, which states, amongst others, that the group's actual performance, outcomes and results in the future may differ materially from those expressed in forward-looking statements herein.

Slide 3. This is our agenda for today. I'm very pleased to present our '25 full year results covering the following topics: group highlights, business segment discussions, portfolio management, productivity, contract wins and order book, debt, dividends and outlook.

Group highlights. Slide #5. In the second half of 2025, we continue to streamline our portfolio with 4 significant divestments. We also recorded noncash impairments relating to our Satcom business. These actions with the one-off effects affected our reported financial statements and distorted the group's underlying base operating performance. To enable our stakeholders to better assess the financial performance underlying our continuing businesses, we will be using the term BOP, or base operating performance, throughout this presentation. Some of you call it by other names like clean or underlying, but it means the same thing, or non-GAAP.

On a BOP basis, we delivered an excellent set of results for 2025. Here are some highlights. Revenue reached $12.3 billion. BOP net profit surged to $851 million. This translates to year-on-year growth rates of 9% and 21%, respectively. We also achieved contract wins of $18.7 billion, which is 49% higher year-on-year, lifting our order book to $33.2 billion or 16% higher year-on-year.

During the year, we recognized one-off noncash impairment of $689 million, partially offset by divestment gains of $301 million. These figures were reflected in the reported P&L statements. Importantly, the group generated strong cash flow, $1.7 billion from operations and about $700 million from divestments. These cash resources enabled us to, firstly, return value to shareholders via the special dividend as recommended by the Board; secondly, pay down debt to $4.8 billion; and thirdly, reinvest in our growth. Informatively, our return on equity for 2025 is 28-plus percent.

Slide 6. This slide shows the reported P&L, and I will not dwell too much because of the distortions from one-offs. At the revenue level, unchanged from base operating performance, with second half '25 revenue up 12% on the left and full year '25 up 9% on your right. Reported EBITDA, EBIT, PBT and net profit are lower year-on-year, primarily due to one-off items recorded during the year, such as impairment losses and divestment gains. And these impairment losses do hit many lines of the P&L, except revenue. Nevertheless, we are pleased to report a positive second half '25 net profit after taking in all the one-off effects of 2 half '25 as we have guided.

Slide 7. Now this slide shows base operating performance or BOP. On a BOP basis, 2025 was a very strong year, which reflected the strength and resilience of our underlying businesses. For the second half of 2025, which is on the left, the group achieved very strong growth, 12% growth in revenue, 9% growth in EBITDA, 16% growth in EBIT, 21% growth in PBT and 22% growth in net profit. For second half 2025 growth over first half, which is not shown here, which is a half-on-half, second half '25 versus first half '25, net profit was $448 million or 11% higher than first half '25 of $403 million. This represents good trajectory going into 2026. In other words, the second half is -- have higher and better numbers than first half.

For the full year 2025, the group also performed very well, 9% growth in revenue, which crossed the $12 billion mark for the first time, 10% growth in EBITDA, 16% growth in EBIT, 20% growth in PBT and 21% growth in net profit. As the year-on-year revenue growth rate for second half 2025 was 12%, as you can see in the slide, and higher than the 9% growth for the full year 2025, as you can see on your right, the operating momentum is indeed very strong.

Slide #8, revenue by segment. On the left, the pie chart shows the revenue breakdown by segment for 2025. 40% was contributed by Commercial Aerospace, CA in short; 43% was contributed by Defense and Public Security, DPS in short; and 16% was contributed by Urban Solutions and Satcom, or USS. DPS as a segment includes both local and international customers. It also covers commercial domains, including public security, safety, critical infrastructure and others. Hence, DPS as a segment has a revenue of $5.3 billion in 2025 on the left, is different from the revenue derived from defense products and solutions, which is in the middle of the chart of $3.8 billion. So in other words, the $3.8 billion is a subset of the $5.3 billion.

Revenue by type in the center, it shows revenue for the past 2 years. Commercial revenue increased from $7.8 billion to $8.6 billion. Defense revenue increased from $3.5 billion to $3.8 billion. On the right-hand side, revenue by customer location. The table shows revenue by customer location. Asia contributed 55%. It went up. U.S. down 19%, partly because of Leeboy, MAE and lower PTF in the U.S. Europe 20%, and others 6%.

Slide #9. This slide shows the year-on-year increase in group revenue by segment. In 2025, our revenue grew from $11.3 billion to $12.3 billion, an increase of 9%, contributed by all segments. If not for the weaker U.S. dollar average rate in '25 versus '24, the group revenue would have grown more than 9%. It would have grown by 10% year-on-year.

Now from another perspective, on a rebased basis, if we exclude Leeboy revenue, which was divested in September last year, from both the 2025 Leeboy's revenue and 2024 Leeboy revenue, we just rebased everything, our underlying continuing businesses would have grown by 11% instead of 9%.

Slide #10. This slide shows BOP EBIT. EBIT grew 16% year-on-year on a BOP basis, driven by effective execution, business growth and cost savings across the group. After accounting for one-off items during the year, reported EBIT is lower. This -- these items relate to portfolio actions taken in 2025. On a rebased BOP basis, if we exclude EBIT of Leeboy and our share of [indiscernible], both these companies were divested, for both years, '25 and '24, the underlying businesses grew 18% year-on-year.

Slide 11, net profit. On a BOP basis, net profit grew 21% year-on-year to $851 million. On a rebased BOP basis, again, excluding the net profit from Leeboy and share of [indiscernible], the underlying businesses grew 24% year-on-year, that almost 1/4.

Next, we move on to discuss business segment. Slide 13. For CA, revenue grew 14% to $5 billion. I think Jeff is very proud of hitting that $5 billion, very close, but really almost there. This growth was contributed by stronger sales from engines, MRO and [indiscernible]. In terms of contract wins, CA secured $5.8 billion, and this is on your right, of new contracts in 2025, of which $1.7 billion was secured in the fourth quarter alone. You will notice that the contract wins exceed the revenue drawdown from the order book, which is a good sign.

Slide 14, Commercial Aerospace EBIT. On a BOP basis, EBIT for CA grew 22%, very strong, to $487 million, outpacing the revenue growth we talked about of 14%. So revenue grew 14%, but BOP EBIT 22%. So clearly, this is driven by higher margins. On a reported basis, EBIT for CA was $542 million. This is the last bar on the chart, and that includes the divestment gain on STACO of $56 million.

Next, DPS, Slide 15. For DPS, revenue grew 8% to $5.3 billion. On a rebased basis, revenue grew 11%. The growth was contributed by all subsegments. In terms of contract wins, DPS secured $9.1 billion new contracts, very large number, in 2025, of which $2.5 billion was signed in the fourth quarter 2025, reflecting continued demand from both domestic and international customers. Again, I want to highlight the contract wins of $9.1 billion far exceeds the revenue drawdown from order book for this period of $5.3 billion. So very, very healthy, more than replacement rate.

The Qatar MRO contract, which we just announced this morning, to maintain different fleets of land platforms for the Qatar Emiri land forces is a very significant win for us. Why? Because in addition to the contract value of $470 million, this contract demonstrates the trust and confidence placed in us to maintain the operational readiness of critical land assets of an international military organization. So from that perspective, it is a breakthrough, and we hope this will lead to even more successes. And such MRO revenues are also recurring in nature, which is helpful.

Notably, our international defense contract wins have also doubled year-on-year, underscoring the growing contribution from overseas markets. We continue to work on many international defense projects, and there are many irons in the fire. We target to double international defense contract wins in 2026 year-on-year. We hope to do better than that.

Slide 16, Defense and Public Security EBIT. On a BOP basis, EBIT for DPS grew 14% year-on-year to $725 million, outpacing revenue growth again. This is driven by strong business growth and higher margins, so Commercial Aerospace, higher margins, DPS higher margins, 2 of our largest segments. On a rebased BOP basis, if we exclude the EBIT of LeeBoy and share of CityCAP, the underlying segment EBIT grew 18% year-on-year.

On a reported basis, EBIT for DPS was $919 million, including the divestment gains for LeeBoy and CityCap net of impairment loss in [indiscernible].

Now the third segment, Slide 17, USS, Urban Solutions and Satcom. For USS, revenue grew 4% to $2 billion. The growth was contributed by URS, which is our URS mobility, rail and TransCore, partially offset by Satcom. URS performance was supported by steady project deliveries across railroad and Smart Mobility solutions. This pace of delivery for Smart Mobility will accelerate in the coming years. Why? Because it's underpinned by a $5 billion order book already secured, already in the bag for rail and tolling contracts in Taiwan, Thailand and the U.S. And these deliveries will pan out in the coming few years. This $5 billion figure excludes the New Jersey Turnpike Authority back office service contract with a value of up to USD 1.7 billion, including options. [indiscernible] will talk to this a little later, but we basically have been executing to this contract and collecting revenue already. But we did not recognize it because we want to see how it develops in the coming months, and we are continuing to assess it.

In terms of contract wins, USS secured $3.9 billion of new contracts in 2025, of which $0.5 billion was secured in the fourth quarter alone. Again, the contract win, similar to the other 2 segments, far exceeds the revenue drawdown from order book, $3.9 billion versus $2 billion. And this provides very clear visibility to revenue growth in the coming years.

Slide 18. On a BOP basis, USS EBIT declined by $8 million to $32 million, mainly due to higher losses in the Satcom business. This was partially offset by continued growth in Urban Solutions, which is well positioned to grow because of a solid multiyear order book as we discussed earlier. On a reported basis, EBIT for USS was minus $556 million due to direct impairment loss, net of divestment gain of [indiscernible].

Slide 19. We have been providing you update on Satcom, and we will do likewise in this briefing. Allow me to walk you through the transformation progress within the iDirect Group and provide an outlook for Satcom in 2026. First, on the left of your slide, there is good revenue momentum into first quarter '26 at a minimum. On the commercial and government markets, we are expecting a stronger first half 2026, underpinned -- for a stronger first quarter 2026, underpinned by secured orders across multiple commercial and defense customers. These orders, including customers in Saudi Arabia and Europe, will deliver year-on-year revenue growth in 1Q 2026 compared to 1Q 2025.

Intuition, which is our multi-orbit platform, is gaining good traction, for example, with customers like Verizon and AI Telecom of Mexico signing up to this program. Separately, iDirect government was qualified under -- by the government to participate in the U.S. MDA Shield contract, strengthening our position in the government segment. So on the left, on the revenue side, the outlook looks good.

We are targeting for stronger year-on-year growth, not just in first quarter, which we have good visibility, but also in the first half of 2026 year-on-year and the second half of '26 year-on-year. We will keep you posted as the year progresses. Second, on the right-hand side, that's the cost outlook. Actions relating to about $43 million of annualized savings were successfully completed in 4Q '25 and 1Q '26. And these are beyond what we brief you in earlier years where there were rationalization occurring in iDirect. So these are recent actions taken in 4Q '25 and 1Q '26, producing $43 million of annualized savings that are already flowing into the bottom line.

Now the second set of actions relating to the remaining $20 million are on track. The items have been identified. We are executing towards it, and we expect to complete it by second quarter 2026. Therefore, we can expect an annualized total cash savings of $43 million plus $20 million, which is $63 million to accrue in full commencing from third quarter of this year. So on an annualized basis, from third quarter of this year, second quarter next year, we should see a flow down of $63 million of cash savings.

Our priority is to continue focus to support customers and to turn around the business while we evaluate the best path forward for our Satcom business, including strategic actions. Nonetheless, revenue and cost savings is no regret and remain a top priority for [indiscernible].

Next, Slide #10 -- Slide 21, sorry. For financial year 2025, we completed several strategic divestments, Leboy, CityicapP, SPTel and Starco, which collectively generated net cash proceeds of $705 million. These divestments strengthened our cash position for the year. While these divested units will no longer contribute to group EBIT in 2026 after the divestment, the year-on-year reduction in this EBIT is expected to be fully offset by interest and tax expense savings as the cash proceeds were applied towards reducing debt. If we apply some of this towards reinvestment, and we can repeat our return on equity of 28.7%, I think you will have even more accretive EBIT going forward.

Slide 22, productivity. Our OpEx over revenue growth has been trending well over the years, scale effects, continuous improvement, procurement savings and so forth. In 2025, we achieved a new low of OpEx over revenue ratio of 10.2%. As our revenue grow, we continue to experience scale and network effects. Together with productivity gains and cost savings, this helped to mitigate inflation effects in certain areas and help us improve margins as we have shown.

Slide 24, contract wins and order book. Slide 25. We secured $18.7 billion of new contracts, a new record. The group ended the year with a robust order book balance of $33.2 billion, another record. Weaker U.S. dollar and Sing dollar as at end of 2025 compared to end of '24 resulted in a $0.5 billion downward adjustment to the order book. So had the exchange rate been constant, '24 and '25, our order book would look more like $33.7 billion. From this, about $9.9 billion is expected to be delivered in 2026.

Now some of you will recall that in last year in '25, it was $8.8 billion to be recorded in the next year. So this number is creeping up quite fast.

Slide 26. This slide highlights some of our major wins in 4Q '25. And in this period, the group secured $4.7 billion worth of new contracts, $1.7 billion from CA, $2.5 billion from DPS, $0.5 billion from USS. This brings the total contract value for the year '25 to $18.7 billion.

Next, debt management. The company did gear up to seek growth. And some of the major acquisitions we did was MRAS, which is performing very well today, TransCore and so forth. And because cost of debt is always lower than cost of equity, I think it makes sense to gear up to make sensible accretive acquisitions. But since then, we have been performing well operationally, generating the cash flows that I talked about. And hence, our debt level has been dropping from $6.5 billion in '22 to $6.1 billion to $5.8 billion to $4.8 billion. And additionally, the credit metric and rating agencies like to use debt to EBITDA has been dropping from 5.2 in '22 to 4.2, 3.6, 2.7. So hence, our credit rating remains very strong at AAA stable by Moody's and AA+ by S&P.

Next, Slide 30, dividends. For 2025, the Board has recommended a final tax-exempt cash dividend of $0.06 per ordinary share as well as a special dividend of $0.05 per share for the financial year ended December '25. Payment of the final dividend is subject to shareholder approval at the upcoming 2026 AGM. The ex dividend date to be eligible for final dividend is 28th of April 2026. If approved, shareholders will receive their dividend on 13th of May 2026. For the first 3 quarters of 2025, we have already paid out 3 interim dividends of $0.04 each, totaling $0.12. This brings the total dividend for 2025 to $0.23 if you add the final dividend. And as previously shared, the 2026 total dividend shall be determined by the sum of 2 elements. Firstly, $0.18 per share, which is our ordinary dividend as a base. And you add to that 1/3 year-on-year incremental net profit, which we have communicated at Investor Days, but using the 2025 BOP net profit of [ 851 ] as a base and then on a per share basis, adding that to $0.18 will be the dividend guidance that we are giving for 2026. And all the net profit parameters will exclude one-off effects of major divestments and impairments. I think that truly reflects the underlying performance and how we will share the underlying performance with shareholders.

Finally, Slide 32 is the message from our Group CEO and President. In 2025, the group delivered excellent set of underlying performance, reflecting the strength and resilience of our businesses. We continue to streamline our portfolio through several divestments, recycling capital and enhancing our focus on our core businesses. Looking ahead, supported by strong growth momentum and a robust order book, the group is very well positioned to deliver on our strategic objectives and 2029 targets. This marks the end of our presentation. Thank you very much for your attention.

Thank you, Cedric. May I now invite our panelists up on stage, please. The panelists this morning are Vincent Chong, Group President and CEO; Cedric Foo, Group CFO; Marvin Tan, Group Chief Operating Officer, Technology and Innovation and President, Defense and Public Security; Tan Lee Chew, Group Chief Commercial Officer, Market Development and President, Smart City and Digital Solutions; and Jeffrey Lam, Group Chief Operating Officer, Operations Excellence and President of Commercial Aerospace. I will now hand the floor over to Vincent to deliver his remarks. Vincent, please.

Well, good morning. Welcome to the SP Engineering Full Year 2025 Results Briefing. Very good to see you. And for those of you who signed online, thanks very much for joining. And for those who celebrate the Lunar New Year, let me just wish you a very happy Lunar New Year of the Fire Horse. Hopefully, that brings us all good health and prosperity in 2026 or the year of the Fire Horse.

Now building on the financial results covered by Cedric just moments ago, I will focus on a few key takeaways. First, our 2025 results demonstrated the underlying strength of the group's business. Our base operating performance, or BOP for short, broke new highs, including our BOP profit before tax, which passed $1 billion, as Cedric already shared. On a BOP basis, 2025 was a very strong year with robust revenue and net profit growth. The fundamentals of the business continued to strengthen through the year. And revenue, we didn't really call this out, but I'll share with you. Revenue would have been 1 percentage point higher if not for the weaker USD, U.S. dollars in '25 versus 2024.

2025 was also a year of active portfolio actions. The divestments generated net cash proceeds and gains and our decisive steps or were decisive steps to streamline our portfolio, recycle capital and sharpen the group's focus. We also made impairments relating to the iDirect Group and JetTalk, which we -- which were noncash in nature, following a reassessment of near-term assumptions of the business in a challenging operating environment, which we discussed extensively in November last year.

Building on the strong first half, underlying performance was sustained through the second half with continued year-on-year growth. Subsequently -- or sequentially, underlying performance reflected continued revenue momentum with underlying net profit growth outpacing revenue growth, as Cedric highlighted. Taken together, the group remains confident in achieving our 5-year plan targets as set out during our Investor Day last year.

Beyond financials, technology and innovation remains central to how we compete in the various domains, and many of you would have seen this being reflected in our multi-domain capabilities showcased at the recent Singapore Air Show, where we had very good customer engagements. This reflects sustained investments over the years in strengthening our core engineering and technological capabilities, building our R&D ecosystem and innovating in areas that translate into real customer outcomes, which in turn underpins our long-term growth.

Let me just next talk about the next -- the 3 segments. For Commercial Aerospace, in a highly competitive environment where customers place exacting demands on capability, reliability and delivery, our strong performance in 2025 reflects not just a continued recovery in the aviation market post-COVID, but how this business has been built and positioned over time across both OEM subsegment, particularly our [indiscernible] business, and our MRO activities. We have continued to optimize our global network, as we have shared with you across our facilities in Singapore, China and the U.S., particularly for our hangar capacity, expanding where demand is growing and streamlining where needed, while maintaining a strong and competitive MRO footprint globally and sharpening execution across the network. This includes capacity and expansion in our engine MRO operations in Singapore, alongside our early investments in LEAP engine MRO capabilities, which have strengthened our ability to support customers as the LEAP fleet continue to expand.

This is evident in the scale of the Commercial Aerospace business today with a revenue of $5 billion, which is more than double its pre-COVID level and is further validated by strong contract wins during the year, as Cedric walked you through. Together, these outcomes reflect both the strength of our customer value proposition and our consistency of execution in this business.

Next, moving on to the Defense and Public Security segment. The segment delivered a strong full year performance with contributions across its subsegments. Following strong first half, the second half revenue moderated to 5% year-on-year growth, reflecting the timing of project deliveries that is typical of the business as well as the divestment of LeeBoy in September last year. And if you rebase the revenue for DPS without LeeBoy, second half, we would have grown by 9%, as Cedric also mentioned.

On a rebased basis, adjusted for LeeBoy, full year revenue and BOP EBIT growth remained really quite robust. At a subsegment level, Land Systems rebased revenue grew 4% year-on-year, rebased without Leeboy, I meant. All other subsegment revenues also grew. You can find those information in the latter half of the analyst PowerPoint presentation that you have a copy.

Contract wins for the [indiscernible] segment were strong at $9.1 billion. And while wins can be lumpy by nature, it depends on timing of projects at the customer end. The segment benefits from good revenue visibility, supported by ongoing programs. Digital Systems and Cyber continue to benefit from demand for secure, digital and cyber-enabled solutions across defense, public security and critical infrastructures. We continue to see good traction in international defense markets. Though progress remains program timing driven, as I mentioned, it really depends on customers' project timing. And we are engaged with customers at a mature stage in a couple of other programs, and we'll update the market when appropriate.

We marked a key milestone in our international defense business with our entry into the Qatar defense market, as Cedric already mentioned, as you would have seen the announcement this morning. It's a 5-year MRO contract for the Qatar Emiri Land Forces. The win reinforced the fact that Middle East is a key market for us as we articulated during our Investor Day. While the digitally enabled end-to-end MRO program for the Qatar Emiri Land Forces highlights our capability to deliver long-term technology-driven land forces support. Later on, Mervin can shed a little bit more information on this particular contract, which is a key win for us.

Now turning to Urban Solutions and Satcom. Urban Solutions performance was supported by steady project execution and increased delivery momentum, particularly in the second half as projects progressed. Beyond near-term delivery, what gives us confidence is the structural relevance of this business. As urbanization accelerates globally and cities modernize critical infrastructure, demand for integrated technology-enabled smart mobility and urban systems continues to grow. This gives us good visibility on business growth, particularly across the smart mobility pipeline.

On the iDirect Group, as Cedric has outlined, we are seeing improving activity heading into 2026, supported by secured orders and progress on the intuition multi-orbit program. We are targeting a stronger year-on-year first half revenue for our Satcom business, as Cedric already mentioned.

On the cost side, we have already implemented about $43 million of annualized cost savings for our Satcom business, which are flowing through to the bottom line, with the remaining actions -- which will be flowing through to the bottom line with the remaining actions on track. In total, these initiatives are expected to deliver about $63 million of annualized cash savings, reinforcing our focus on cost structure. Our priority remains supporting customers, executing the turnaround and evaluating the strategic path forward for the Satcom business or, in particular, the iDirect Group.

Overall contract wins of $3.9 billion for the USS segment well exceeded the 2025 revenue, as Cedric pointed out, supporting good revenue visibility, particularly for Urban Solutions. Importantly, this visibility is supported by a strong pipeline of major smart mobility projects, which are moving progressively into delivery. We have shared that these programs are expected to drive a meaningful step-up in Urban Solutions revenue in the coming years as large-scale rail and tolling projects advance through their delivery phases.

And next, in terms of order book and new orders secured, we secured wins of $18.7 billion last year, strengthening our order book to $33.2 billion at year-end. Our record order book is a clear leading indicator of revenue growth in the years ahead. And finally, on dividend, our Board of Directors has proposed a final dividend of $0.06 per share, bringing the total ordinary dividend for financial year 2025 to $0.18 per share, together with a one-off special dividend of $0.05 per share. Subject to shareholders' approval at the AGM, shareholders will receive total dividends of $0.23 per share for financial year 2025. This is consistent with what we announced at the third quarter 2025 market update in November last year. As we have mentioned at our Investor Day presentation, our dividend policy reflects our focus on realizing value and returning that value to shareholders as the group's profitability continues to strengthen.

Finally, our strong underlying results and BOP performance in 2025 speak to the clarity in the group's strategy and disciplined execution of our businesses. We will continue to well execute our strategy, maintain financial strength and return value and return value to shareholders while continuing to keep a long-term view of our business strategy and growth. On that positive note, we will now take questions.

[Operator Instructions] May we have our first question from the room, please?

[indiscernible] Roy and then we go to Lori.

Roy from UOB Kay Hian. First, congratulations for the very strong core performance. I have 3 questions each related to different segments. Okay. So the first question is for the Defense segment. I understand, Cedric said, we expect to double the international contract wins. We already doubled this year, and we will try to double next in 2026. So could you please share with us what is the international Defense revenue as a percentage of your total Defense revenue? And also in terms of your contract double -- doubling your contract wins, could you please share the scale of your contract wins for international Defense in 2025? That's for the Defense segment.

For the Urban Solutions and Satcom segment, I understand for iDirect, there will be -- sorry, $63 million of cash cost savings initiatives. I want to double clarify this one. Is it -- does it include the previous $15 million amortization savings from the impairment or is on top of that? And it seems to me based on your $63 million savings, even without potential disposal, you may also be able to turn around the operation this year. I also would like to clarify on that.

And the last question is for Commercial Aerospace. I see for the second half, there is improving in your operating margins, even excluding the disposal gains from the [indiscernible]. This improvement in operating margin year-on-year, I would like to know what is -- what caused the improvement, and whether this is sustainable in 2026?

Okay. Thank you, Roy, for your questions. I'll, of course, point to my colleagues for the Commercial Aerospace question. I'll let Jeff answer as the third answer. And then we talk about USS. So first of all, the $63 million cash savings is over and above the amortization and depreciation savings. I'll let Lee Chew go into a little bit more details.

And then on your questions on DPS, we do not disclose international defense revenue as a percentage of total defense revenue. But we will let Marvin talk about the scale of international defense wins in 2025. Maybe we'll start with Marvin, then we go to Le Chew and then followed by Jeff.

Thank you very much, Roy, for your question, and happy New Year to you, and thank you, Vincent. Well, I would say that the doubling of our international defense win for 2025 is a significant milestone for us. And in terms of the figures, I would just highlight that it's more than SGD 600 million, okay? And that's a double from 2025 numbers -- 2024 numbers. And looking ahead to 2026, as you already heard from our announcement this morning, our MRO win of -- for the Qatar Emiri Land Forces land platform maintenance requirements amounts to about SGD 470 million. So taken together, we are quite confident given the prospects that we are looking at, some of which are in quite advanced stages of discussions that we would be able to achieve in 2026, a doubling of that SGD 600 million that we have achieved in 2025.

The source of my confidence come from what Cedric highlighted earlier about multiple irons in the fire, right, and some of which are in the advanced stage. Maybe I'll just quickly give you a sense of some of these opportunities that we are actively pursuing right now. So the MRO for the Qatar Emiri Land Forces is a win for us today. And beyond that, we are hoping that in the MRO space for land platforms, especially in the Middle East market, this would be the vanguard towards having more opportunities, not just within the Qatar Land Forces, but also to provide the same capability for other Middle Eastern militaries in that region.

But beyond the land platform MRO, we are also looking at potential new builds for ship platforms for many of the customers in the Middle East as well as beyond. I would say that we are in quite advanced stages of conversation and discussions regarding potential new ship builds for another Middle Eastern country. And still in the area of new ship build, we are also pursuing quite actively opportunities for ship build to a European country as well as another country in the Asia Pacific region, okay?

On land platforms, as I highlighted in the last quarter, we are in active pursuit for customers for our Bronco as well as our Terex platform. For the Bronco platform, as I highlighted previously, we are partnering with Leonardo as well as Ares for the Italian future all-terrain vehicle platform program. And that is something that is active right now, and we are in close conversation with partners there in order to fulfill the specific requirements of the customers. But beyond the Italians, we are looking at other opportunities in the European theater, which I highlighted previously, which includes Finland, which includes Austria, which includes Sweden, who are all actively -- have active interest in our Bronco platform.

For the Terex platform, we are also in active pursuit of opportunities in the Middle East market, and we are in active conversation with the users there. And hopefully, some of these opportunities will turn into new wins for us. But beyond the new build for ships as well as land platforms, we are also -- some of you may recall that we announced a first overseas satellite win for UAE last year, right? That was in the third quarter, and we are hopeful that we will be able to add more satellites to other customers as well as current customers in the Middle East.

Beyond that, we are also actively pursuing MRO opportunities for our military aircraft platform as well as potential C-130 upgrades, particularly in the Middle East as well as North Africa region. And you would have been keeping track of our successful sales of our munitions including the 155 mm as well as 40 MM, which has seen new customers globally, including in the Americas, in Europe, in Middle East and in Asia Pacific. So taken together, given that we have already clocked the Qatar MRO win under our belt, which amounts to close to $500 million, which we announced today, we have high confidence that we will be able to exceed the $600 million -- more than $600 million international business wins that we achieved in 2025 and to continue the momentum for more international business win at least twice the amount that we achieved in 2025 for 2026. Yes. I hope I answered your question, Roy.

So certainly, we're targeting to double that contract win figure in 2026 and hopefully, for international defense wins and hopefully, we can do better. Well, we'll see because sometimes for -- oftentimes for defense projects, the timing depends on customers' prioritization. So we don't have full control, but we certainly have quite a few opportunities that are being actively worked upon. And hopefully, we can share more news in time to come.

So I think Vincent mentioned the fact that the cost savings of $63 million is on top of impairment savings. And as we look at these cost savings, cash flow improvement, obviously, from an EBIT standpoint, we expect the EBIT to improve in 2026 as well. Cost management is a critical component of the turnaround effort. And I think your other question was, based on this, what is the progress against the turnaround? Cost element being one. The other that we also talked about in Cedric's update is revenue. And we are seeing secure orders that will give us a year-on-year growth in quarter 1 of 2026. And we talked about the fact that we are targeting a revenue picture for the first half to be stronger and obviously targeting to do the same in the second half as well. So that, together with the cost management, will set us on the right path to deliver even better turnaround than we had originally been forecasting and hope. So we'll keep you posted as we go along in the year. But so far...

On the revenue growth and the [indiscernible].

We are on the right -- we are on the right path, and we will obviously update, but we feel good about the revenue traction in the first quarter. We're targeting stronger first half and also stronger second half and cost reduction efforts are bearing fruit. So we'll update in due course, but it's certainly in the right track -- on the right track.

Okay. My turn, Roy. So straight to the point, excluding divestment gain, our second half revenue was actually up 12% over first half. So there's already strength on the top line. And then we also had -- we had good ramp-up on the engine revenue because we built new shop, we introduced new capability. We saw increased nacelle delivery in the second half, right? And we also didn't have costs associated with the closure of our mobile facility in the U.S. right? Okay.

So Lorraine, next.

Yes, great set of results, particularly on the margins, very impressive. Just following up on the trend of Roy's questions, maybe starting a couple of questions. One for Jeff. Looking at the commercial Aerospace margins, I think core margins is 9-plus percent. It seems to be back to pre-pandemic levels. I'm just very curious how much of that would -- and I note Cedric's productivity enhancement chart. But I'm just wondering how much of that is also due to operating leverage and also product shift -- product mix in a sense? And if there's -- going -- looking forward, if there's room for further margin improvement, is that mainly coming from productivity then? That's for Jeff.

I just want to follow up with Marvin. Previously, you mentioned there's a structural change in defense demand. Our indication is that the demand is actually pretty -- much stronger than expected upfront. I'm just wondering when you look at the growth prospects going forward, I mean, this might be crystal ball gazing, but do you sense that this will continue for the next 5 years? Or do you have feeling that things -- after this inertial -- let's say, after this initial spurt, if things will sort of normalize if threats are perceived to be mitigated in that sense?

Okay. So on your first question, just recap the trending for our EBIT margin for commercial aerospace has shown consistent improvement over the last few years. You just recap, right? In 2023, we're 8.6%, 2024, we had 9.1%, 2025 is now 9.8%. And we have said -- and Jeff has said many times that we are targeting EBIT margin of more than 10% -- above 10% as our target, and we are certainly making progress. I'll let Jeff speak more to that. As a second answer, maybe we'll go to Mervin first, whether we see defense demand is structurally changing. And I think we obviously hope that the conflicts can subside. The question about defense industry is related, but it's a separate track in our view because there's a structural change in how countries are looking at defense spending. And I think this upward trend is going to last some time. We'll get Mervin to share more insights.

Thank you very much, Vincent, and thank you, Lorraine, for your question. We continue to stick to our assessment that the increase that we see in the investment in defense for various countries to be a structural shift. And the reason for that is supported by some of the conversations that we have with our, what we call the [indiscernible] directors of the various countries. [indiscernible] directors are essentially the leading individual of countries that are -- who have the responsibility of acquiring arms for their respective countries. And from those conversations, we assess that even if the current wars end, specifically the ones that we are seeing in Ukraine, the perception of threat, I believe, remains, especially in the European theater. So some of the conversations revolve around countries preparing for the reemergence of that threat even after the threat in Ukraine has subsided. It may come up in some other locations in Europe. I won't go to the specifics of it, but like I said previously, what we saw in the NATO Summit in June last year, where the nation states reached a historical decision to increase defense spending to 5% of GDP by the year 2035 is all [indiscernible] one. It's a telling one. I think in recent history, we have never seen, at least after the cold war, we have never seen such commitment by disparate states of NATO committing to spend up to 5% of their GDP.

And individual states, even like Germany, openly say that to reach that 5%, their interim target is to hit almost 3% by the year 2029. But even beyond Europe, you see increased defense spending in other regions as well. The Japanese are now spending about 2% of their GDP on defense and the Japan being the third or fourth largest economy in the world, spending 2% of their GDP on defense, I would say, is quite unprecedented for a country like Japan. And they used to have a spending pattern of less than 1% of GDP, given that their defense force built up is primarily for self-defense given Article 7 in their constitution.

Beyond Japan, we see the Canadians now looking at building quite significantly their own defense industry. And of course, when you build up your own defense industry there, you're looking at partners that will be able to help support transfer of technology and as well as sharing of technology in order for them to build up their own defense industrial base. And they are spending up to 2% of their GDP as well, which is also quite a significant increase from the past.

And in the theater that we are actively involved in the Middle East, all, if not, I think almost all the countries have pledged to spend a lot more in defense over the next 5 years. So I think, one, given the kind of pledges that alliances like NATO is making with regards to long-term defense spending, i.e., 5% by 2025; two, countries beyond NATO looking at increasing their defense spending as a percentage of their GDP; and number three, from the feedback that we get when we talk to all the different [indiscernible] directors, Europe, in the U.S., in the Middle East as well as in our region, you get a very strong sense that this commitment to rearm and to sort of reconstitute the defense capabilities is structural in nature.

And our assessment continue to be that even if the current war subside, such defense spending patterns or accelerated defense spending patterns will likely continue. So that augurs well for our Defense and Public Security business, which is the reason why we are confident to be able to double our new wins for 2026 over 2025, building on our doubling of our new wins from 2025 from 2024. So that source of the confidence is supported by the data that we are seeing.

Thank you, Mervin. Yes.

Lorraine, in many ways, you actually answered your own question because you mentioned operating leverage, which is the kind of scale that we are achieving and the product mix. In addition, obviously, we continue to work very hard on productivity gains, applying the latest technology in digital and AI. Our target, as previously communicated, is to grow Commercial Aerospace revenue at more than 2x industry growth rate, which is estimated at around 3% to 4% today. As can be seen from our latest results, our revenue outpaced our target and grew 14% year-on-year. Even though there may be short-term fluctuations in growth rate, I am optimistic that the market continues to be robust and steady. From an EBIT margin perspective, as Vincent has highlighted, we have always targeted double-digit margin, and we are progressively achieving -- getting closer to achieve that outcome, right? Thank you.

Thank you, Lori, for your questions. Anyone else? Okay, Jason, and then after that, Hong.

Jason from DBS. Just 2 questions for me. So the first one is for Jeff. So maybe if you could share an update on the progress of new hangers and engine shop capacity expansion. What kind of uplift in percentage terms to provide to -- in terms of capacity that will be coming on stream over the next few years? So that's the first one for Jeff.

Second question is on the Urban Solutions and Satcom business. So this is for you, [indiscernible]. So maybe I was hoping you could provide some color on the kind of operating profits that the Urban Solutions subsegment has been able to achieve over the past few years, given that segmental operating profit figures are being dragged by Satcom. So it's hard to decipher, it's hard to tell the extent of growth that the core business has been able to achieve. And it's been a few years since [indiscernible] acquisition now. Hoping you can provide an update whether it's tracking your initial targets and whether you are still on track?

Okay. So Jeff will be able to give you an update on the capacities and for the new capacities that we are adding. For USS, we do not disclose operating profit at the subsegment level, but I think for URS is strengthening as you can tell. We are -- as we already mentioned, we also have a very strong pipeline of projects that we are delivering against in the Smart Mobility segment. So we expect URS to continue growing. And of course, the acquisition of TransCore was a good acquisition for us. We are on track to achieve what we set out to achieve the objectives of the acquisition. And we mentioned to you before, the order book of TransCore compared to when we first acquired it has more than doubled -- about doubled, excluding the New Jersey NJTA EasyPass back office project that we have started but have not recognized in the order book. So we are certainly on track, but [indiscernible] can give you more color about our URS business, not just tolling, but also urban mobility in the rail space, which we are really doing quite well.

Okay. All right. So you learned that we did rationalize the mobile facility in the U.S. in terms of optimizing our operations. But currently, we are building at 3 different sites for airframe maintenance capacity. One is Changi Creek in Singapore. Second is Pensacola hangar, construction continues. And third, our new [indiscernible] joint venture continues to build its second hangar. So over the coming years, we do expect to increase net capacity for airfreight maintenance by double-digit percentage. In addition, on the engine shop that we opened in Singapore last year, that will give us in the next few years, additional capacity of about 50% to overhaul engines, right? And you can already see the growth that we saw last year from -- in terms of engine maintenance work that was also driving a lot of the MRO growth. Thank you.

Okay. So maybe I'll start with TransCore. We have achieved the acquisition milestones in the first couple of years post acquisition. Obviously, TransCore is now part of the URS business. And to Vincent's point earlier, we are seeing good robust traction and growth in the Urban Solutions business. I guess that's what you meant when you say the core business. If you look at what we have shared in quarter 1 of 2025 and what we've reiterated today, we talk about the fact that just the mobility part of the business, looking at an order book of $5 billion, that's a subset of what we ended in terms of order books for 2025. So we see that as we look at the strength of the new contracts in Urban Solutions as well as the strength of our order book, the revenue and EBIT for this core business will increase with the major contracting to be delivered over the next few years. So in that context, this business, the Urban Solutions business with TransCore integrated as part of it, is tracking well and within expectations.

So [indiscernible], maybe you want to talk a little bit about the synergies, too. Post acquisition, after having TransCore as part of our network, we have secured wins for TransCore in the Asia Pacific region, which speaks to the synergy that this acquisition brought us.

Yes. So I think we have announced that TransCore won a contract in Southeast Asia early last year. And then we also announced a contract from Transport for New South Wales to deliver the next-generation multilane free flow tolling system. The synergies that we looked at as we acquired TransCore was to bring the tolling solutions from the U.S. into Asia Pacific. So we've seen that come through for Southeast Asia, also extending to South Pacific in Australia. On top of that, we are seeing that momentum also carrying forward into opportunities and RFPs that we are working on outside of Asia, outside of the United States into Middle East and so forth. So our teams are working together because, obviously, our footprint for Urban Solutions is not just restricted to Southeast Asia as well. So the teams are working together to extend the adjacencies of our capabilities, both from a road and rail perspective for Urban Solutions as well as the tolling part in road from TransCore.

Do we have anybody -- any questions from those who participated online? Then we'll come back to the physical attendees, if it's okay.

Yes, we have Louis from Citibank.

Congrats on the results. I have 3 questions on the 3 major segments. First off, for DPS, we noticed that half-on-half movements, ever since second half 2024, Marine Systems and Digital and cybersecurity have been consistently on upward trajectory, while land and defense and aero swing between the halves. But given your order win momentum recently and after the announcement today, do you see that changing so that everything will be essentially improving half-on-half from here on?

The second question is on Commercial Aerospace. It seems that aero structures and system revenues in second half '25 have rebounded nearly back to the levels of first half '24. Is this largely due to nacelle, or is even TTF starting to pick up at this stage?

And the last question for Urban Solutions essentially is, if we can get an update on the New Jersey Pipe contract issue? Is there any time lines or milestones we should look out for then you'll be able to put it as official order book?

So let's have Mervin answer your first question. Luis, thanks very much for your question. And then we'll get Jeff and subsequently Chew to answer the other 2 questions that you had. So Mervin, please?

Thank you very much, Luis, for your question and being online to listen to our presentation. I would say that your observation that for the digital kind of business where it tends to be more consistent in terms of new wins, right? Yes, I think that's correct. Because typically, the digital solutions kinds of wins, including cyber, of course, tend to be smaller and more consistent in nature. So to have consistent wins across quarters, across half-on-halves is quite expected. But I would say that for the engineering side, where we are looking at land platforms, ship builds as well as even defense aerospace kinds of business, the tendency for the wins tend to be lumpy and episodic. They can be large in nature, sometimes big and sometimes small. And I would say the timings of those wins are rather irregular.

As Vincent pointed out earlier, some of these larger kind of contracts for land, marine or defense aero takes just long gestation times. And when they come in, they can come in quite episodically. And certain periods, there will be none, other times, there will be significant projects that we may win. So it can be quite episodic. And I would say that it's quite different in terms of the nature compared to projects that are in the digital space. Therefore, I would say that whether you're comparing quarter-to-quarter or even half-to-half comparisons or updates may not be as useful as it doesn't really reflect the underlying momentum of our defense business.

I think a more useful gauge you should look at would be at the DPS level, our quarter-to-quarter reported wins, which you would have registered has been quite -- getting quite significant momentum over the last few quarters. I think those would be a better indication of our strong momentum that we have gathered over the last few quarters where eventually, many of these reported wins will translate to revenue. So I would say that don't look at it quarter-to-quarter or month-to-month at the subsegment level, look at it from the perspective of the entire DPS new wins quarter-to-quarter, and that will give you an indication of the strong momentum that we are enjoying currently. I hope I answered your question, Luis.

The aero structures and systems revenue in second half was stronger than in first half due to both nacelle and PTF revenue growth. Having said that, the PTF revenue in second half of '25 is still weaker than in 2024, right? So as we look forward, we are hopeful for the market recovery, and we continue to look out for the signs of this recovery.

Luis, for the New Jersey Tmpi Authority back office project, while the court appeal is ongoing, actually, the contract award has been given to us, it's signed, and we commenced project work in the middle of last year. As it relates to when we are going to add that to our order book, we are reassessing it, and we'll do that on an ongoing basis.

So basically, we're in a good position because the project has started and the work has started. But as far as when we recognize the order book, we'll continue to assess on an ongoing basis, okay?

Okay. So any other -- we'll come back to the room and then we go back to the online participant again. So we say Hong Han, maybe.

Congratulations on a very strong set of results. I have questions regarding Qatar MRO contract wins and iDirect with respect to the Shield program. So 2 questions on Qatar MRO, right? I want to try to understand with regards to the MRO solutions that you provide. Is that agnostic of the military equipment your customer use? Or is that limited to a specific type of weaponry? I'm trying to -- I ask this question because I want to understand in terms of your addressable market and how it could apply to other potential customers as well.

Second question on this MRO solution is, why is the tenure just a 5-year contract? It seems rather odd and short. We thought that MRO with regards to military tend to have a 10-, 20-year tenure.

The last question with regards to iDirect would be on the Shield program. It looks like there's a lot of things going on there. Can we try to understand in terms of the addressable market that you're looking at and some near-term prospects?

Okay. All right. Thank you, Hong Han, for your question. We'll let Mervin start first and then followed by Lee Chew. Mervin, please?

Thank you very much, Hong Han for your question. Happy New Year to you. Thank you for your questions for the Qatar MRO because it gives me an opportunity to sort of highlight how pleased we are with this new win, right, as highlighted by Vincent earlier and also Cedric, is that this is an important win for us, not -- on a few fronts. First of all, it is the first breakthrough that we have into the Qatar market. That's number one. Number two is that I think more important than just a platform win, this is an MRO services win. What it means to us is that actually, you require more trust on the part of the customer to entrust the maintenance of critical assets and critical platforms of your land forces to a foreign supplier like ourselves. So it sort of underscored not only the confidence that they have in terms of our technical capabilities, but I think more importantly, the trust that they have that we will be able to respond effectively in terms of logistics support, in terms of technical support should the forces that are using these land platforms are caught into operations.

It's not easy for them to make a decision. And therefore, their decision to award us this contract underscores both confidence, but more importantly, trust that they have that we will be there to support them in actual operations, right?

On the technical competency front, I would say that the competencies are quite agnostic of the platform, but the technical solution are specific. So our MRO support is not just for one fleet of platforms. It's actually across different fleets of land -- different land platforms for the Qatari Emiri Land Forces. I wouldn't tell you the numbers because I don't think my customer is comfortable for me telling you the numbers. But I would say that it will be in excess of 5 different kinds of platform types.

The competencies are agnostic because the technical capabilities that we have acquired over the years for MRO, of course, supporting the SAF, have come in quite useful. And that includes things like the design of the workshop, things like how we are able to leverage digital solutions in order to digitalize the MRO processes, cut down manpower, et cetera. Our philosophy of how we provision for spares, which is something that is an acquired skill after many years of support that we have provided to the SAF, right? So those kind of qualities, whether in the technical space, whether in terms of our process and procedures, in terms of our design of digitalization, process and procedures in terms of spares provisioning, those are not trivial and those are quite critical competencies that are agnostic to the platform that we support. Because those philosophies and capabilities that we leverage on in order to support the Qatari Land Forces, those are agnostic capabilities that we have acquired over the years, right?

But the solution translating from these agnostic competencies into the specificities of the technical solutions for the different kind of fleets, right, that the Qatari Land Forces have, those are, of course, specific, okay? Those are specific. So we have to apply ourselves to some of the platforms where we already have competencies because the SAF have the same platforms, but we also have to apply those same competencies to support platform fleets that are first time for us. That means the SAF doesn't operate those, but they operate those platforms, but they have entrusted us to apply our competencies to come up with technical solutions for those platforms.

So I hope I answered the first part. On the question of why it's a 5-year contract, I would say that this is the comfort level of the customer. But I will tell you that MRO services is very sticky, okay? As you can imagine, after what I described in terms of the competencies, the design of the workshop, the designs of the philosophy of how you do spec provisioning, the relationship that we have with the OEM that supply these platforms to the Qatari forces. So I would not be too concerned that it's a 5-year contract. It's the first time they are doing this. So you can imagine from their perspective is that they want to try it out, right? But as a supplier, I'm very confident because it's easier to change a platform type from one to another. It's very difficult to change your MRO partner from one to another.

So I wouldn't put too much weight on the fact that it's 5 years. I would say that, that's because it's the first time for both of us. So we want to try it out. But I would say that I'm fairly confident that after these 5 years, we will be able to do a sufficiently good job to be able to continue to provide the service beyond the 5 years.

Well, thank you, Mervin. We are confident of our capability to add value and support the Qatari Emiri Land Forces. Let me also recap that the MRO contract covers digitization of maintenance workflows, anomaly detection, feed analytics. So it's not just a mechanical part, but it's going to be digitized as well, which plays to our strength because we do that very well over time. So we will be able to very well support the Qatari Land Forces for sure. So we are yet to...

So on the iDirect front, we are obviously very thrilled that iDirect Gulf has been qualified to supply the Shield contract, and this Shield contract is with the U.S. Missile Defense Agency. What it allows us to do is to be qualified to compete for task orders over the next 10 years. What has been announced is that the ceiling of this whole program is $151 billion. Of course, it's hard to crystal ball what that market share for us is going to be. But I think the important thing is that as part of our growth strategy in iDirect Gulf and Defense, we want to make sure that we engage early in government programs. So this is one of the examples of the programs. We are obviously also very laser-focused on building our government network. I think over the last few months, if you're following some of our press releases, you would see that, in November, we talked about our expanded leadership with Black Cat Systems, more for the Australian Defense Force to set together -- to set up together an advanced technology demo lab to look at innovations.

In later part of 2025 in December, we talked about how our EPW, the European Protected Waveform program achieved a major milestone because we were able to complete the over-the-air testing successfully. In January of this year, we talked about this Shield contract. And then just very recently, we talked about how our manufacturing competency center in Belgium was selected by Raytheon to support NATO's ESSM Block 2 program. So that's the focus that we have, looking at how we leverage this increased demand for sovereign networks as well as this increased demand for secure communications. And so all of this will be part of that growth trajectory that we envision.

Thank you. We have a few other hands in the room. So we'll take time to cover all your questions, and then we go back to online later. Siew Khee, and then after that, we come to [indiscernible], since you have the mic. And then we'll Siew Khee, We'll cover all.

Zhiwei from Macquarie. Congratulations on a very good set of results. I have one question and it's on the defense side. It kind of follows up on what Luis was asking just now. So your defense -- the gist of the question is how do we think about your defense margins going forward as you increase the amount of contract wins that you have? And I'll expand a little bit on where I'm coming from.

So as Luis said that most of your revenue growth has come from 2 areas, which is your digital systems and cyber as well as your marine, right? And that have been helping to lift your margins to the about 13% EBIT margin range. So I understand the MRCVs will help to improve margins, and it's not too difficult to see that digital systems actually have very high -- carry high margins with it. Now as you win your more other contracts, let's say, land systems, right, [indiscernible], if I look at your peers, their EBIT margins are closer to 10%. So how -- do I expect a certain form of dilution as these lumpy contracts come in to kind of keep your margin it is or even drag it down? Or can I still expect further improvements in your defense margin, if you see where I'm coming from? Also, you also have the Hunter AFV program that comes off this year and it's replaced by the Titan. So I'm also not sure how that affects your margins.

Is that the only question you have? Okay. All right. Mervin?

Okay. So thank you very much for your question, and happy New Year to you. And you can imagine how difficult it is for me to answer that question given the kind of product mix that I'm responsible for in DPS. I sell things from digital systems and like cloud solutions, AI, cybersecurity, data diodes, all the way to armored fighting vehicles, ships and all that. So your question is particularly challenging because I'm not sure what specificity in terms of your product that you are referring to. But suffice to say that I think there was a bit of a misinterpretation there where you said that we are only -- most of our wins come from digital systems, cyber and marine.

[indiscernible] delivered an improvement in margins, at least that's what we observed just from the financial statements. So I'm trying to understand, as your product mix changes, you sell more broncos, you sell more Terex, right? How does that margin evolve?

Okay. Okay. But I'm also selling more Terex yesterday.

Yesterday?

Yes. Because like, for example, we just won the contract, right, for the Terex for our Singapore Armed Forces last year. So but -- so I would say that I don't think that our margins would change significantly, I would say. In fact, over the last few years, I was looking at those numbers, and our margins have always been in the low teens. If you look at 2025, low teens, if you look at 2024, low teens, you look at 2023, low teens. And in that space of the few years, the product mix and services mix that we have contracted and converted to revenue are very diversified. And moving ahead, I would say that, that diversification will continue. So it won't come from just one specific business area, but we'll continue to deliver a very diverse range of products and services across our 5 business areas. So on that account, I would expect the margins moving forward for 2026, 2027 to continue to have that diversity, and therefore, to continue to have that comparable margins.

In our Investor Day targets, we said that net profit growth rate will be up to 5 percentage points higher than revenue growth rates for various reasons because I think the discussion now gets into very specific platform types. But at the higher level, with scale, with productivity that we have been showing that we are managed to achieve and then with scale of operations with product mix and margin, our net profit growth will continue to strengthen at a rate that is faster than our revenue growth holistically as a group for those reasons. So that applies across the 3 segments.

Yes, can we have Siew Khee?

I'll just cut it to 2 questions. The -- just on strategic review and options for iDirect, where are we now? Whether there's any like time line pushing to the right in what we wanted to do? Is there any stumble block in that process? That's my first question.

And the second question is on -- just going back to the MRO on defense side. Given that this is a major breakthrough, was it an open bid? How did they use to do their MRO? Was it internally? And what were the deliverables that allow them to -- I know that they trust you, but was it like cost optimization that you can actually give the customers to actually engage you instead of doing themselves or who were the previous provider? And what sort of CapEx or scaling that we need to actually do to be there to do this service?

Yes. So let's answer -- you have 2 questions. One is strategic actions for iDirect, right? The other one is Qatari Emiri Land Forces, how did they -- how did this opportunity arise? So when we talk about -- let's talk about Satcom strategic actions. We already mentioned that we are evaluating. There's never an assurance or definitive outcomes that we expect. So we'll continue to evaluate. Meanwhile, it is important for us to continue our turnaround, continue to focus on taking care of our customers, continue to focus on improving our revenue and cutting our costs. Whether strategic actions come at what time, I think we'll let the -- let this particular topic take its own cost, and we'll update as and when we have any, but the evaluation continues, right?

The Qatari MRO contract. First of all, we are deeply honored to be selected. In talking to our partners and users and customers, they have high confidence in our ability to help them improve on their MRO performance. We won't go into details of who is the current provider. Those are, I think, customer information that we shouldn't get into. But suffice to say, they have high confidence that we will be able to add value to help them improve on their performance. And that, I think, is an honor that we have to execute against that expectation, which we are very confident that we will be able to do a good job. And then with that, there will be more opportunities that will come to us. And this is an important, I think, first step in the MRO space, especially for the Middle Eastern market.

Okay. I hope that at least address your question for now, and we can come back to you if you have further questions later.

It's Da Wei from Morgan Stanley. I have 2 questions. First one is actually at a group level. I know we saw a series of portfolio management activities this year or 2025. Are we at the optimal level at this point? Or should we actually expect more on a going-forward basis?

The second is actually on Commercial Aerospace. Congrats on a very strong growth. And I know you mentioned -- Jeffrey mentioned that we are adding capacity, et cetera. It sounds like there's significant capacity that's coming through. Can you also share some commentary with regards to the demand outlook? How should we think about the potential take up for all this capacity that's coming and the pricing with regards to that? And actually have further questions on defense bridge, but I think we can take it offline over lunch.

Yes. And the first question, can you repeat the last part? I want to make sure that we get your question.

So are we at the optimal level with regards to the portfolio at this point? Are you thinking of...

Portfolio.

Yes, potentially more divestments or...

Okay. Okay. Then we'll get -- I'll answer that question, and then I'll get Jeff to address your question on aerospace demand and pricing margin. As we mentioned oftentimes, portfolio evaluation is a continual process. We constantly look at the businesses in our portfolio, and we look -- we do so through several filters. First of all, is the business strategic still -- still strategic to the group? If it is, is it performing to our expectations financially? If it is, do we have a long-term expectation that you will continue to grow to a better scale, global scale. Then with those answers, it inform our decisions on whether or not it's a long-term keeper in our portfolio. We also ask ourselves whether a particular business when they -- based on their performance, whether it is worth more to a bit different owner than is it to us. Then we make that determination.

It's an ongoing process, a business that we decide to have within our portfolio at a certain point in time might not be a business that we want maybe when the external environment changes. That's how we have been managing our portfolio. In the last 8, 9 years, we have either stopped, divested or shut down more than 20 businesses. We also, at the same time, acquired new ones that are strategic to the group. So -- and that will allow us to allocate capital efficiently, ending up with a portfolio that gives us the best value. So that is a continual process. So that, of course, in the years ahead, we'll continue to do the same. So we'll get Jeff to answer your questions on commercial aerospace. Da Wei, I hope I have answered your question.

Thank you for a very relevant question. The market -- the aerospace market is largely driven by the size of the fleet and the flying demand of the public. So as you can see, every year, the fleet size grows with new deliveries, and there will obviously be retirements. But there is a strong order backlog of over 10,000 aircraft that is yet to be delivered. And the OEMs are striving to deliver as many new aircraft as possible at a high growth rate. Although there are supply chain challenges in the short to medium term, there is a strong and steady demand for new aircraft based on the demand for flying.

Secondly, as the fleet grows, the MRO demand also grows. As the fleet ages, the MRO demand also ages. So driven by the growth of the aircraft fleet in the market, there is also a strong growth in MRO demand that is steady and long term. As forecasted by the analysts, there is this -- MRO market growth is in the range of 3-plus percent for the next 20 years CAGR.

And then thirdly, because of the fleet growth, there is also a growth in demand for financing. So there is -- the world's fleet is largely financed now. Over 55% of the fleet is financed as leased aircraft by the financing industry in support of the airlines. So this segment of business also grows. So what I have mentioned is actually aligns with our 3 segments of business, including the OEM product business; secondly, the MRO maintenance business; and thirdly, the leasing business. So we are plugged into all of these 3, and we continue to expect a steady, robust growth in the coming years. There is obviously competition in the market, but we are used to global competition across all of our business segments. We face global competition in any business that we try to win. So I think the positioning and the outlook is positive.

Any other question. Jesse?

Jesse from Bank of America Securities. My first question is, given we have witnessed very robust order wins last year, could we actually accelerate the review of our 5-year target? Or alternatively, what business trajectory scenario would prompt us to revisit that target as it may no longer align with our expectation?

And second, more for Mervin, regarding to the Qatar MRO contract. Was it considered as part of the addressable -- international addressable market we mentioned before at $11 billion? If not, how should we think about the new revenue pool or addressable market after this initiative or contract win?

Okay. So I think they are all related questions. Maybe I'll take it and then we can invite Mervin to give you a little bit more insight. So we don't revise our targets in between that regularly because I think it is long-term plan. And as we mentioned, there's always an upside, downside risk to that set of targets and the external environment continue to change. What we have done in the last few -- many years, I think since 2018 when we first had our Investor Day meeting, we set a 5-year target. And then 3 years later, we had a second Investor Day in 2021, where we took stock of our progress towards the first set of targets. And then we set a new set of targets. In 2021, we set a new set of 5-year plan targets. And then last year, we set another new set while giving our stakeholders and shareholders an update of how we did versus the 2021 set of targets, and we'll follow this cadence.

Suffice to say that at this time, we are not changing our targets despite the divestments that we have made. First of all, our 5-year targets are based on constant portfolio basis, excluding M&A and excluding acquisitions and excluding divestments. And we said that if there are divestments or new acquisitions, at the appropriate time, we'll adjust the targets. At this time, despite the divestments, we are not adjusting those targets because we are confident that we will have other growth levers that will allow us to pursue the same set of targets.

As far as the defense pipeline of $11 billion is concerned, that pipeline was assessed prior to the announced increases in defense spending, especially in Europe. So directionally, you would think that the pipeline or the addressable market for us would have increased, which is also consistent with what we are seeing. So instead of updating that pipeline figure, we will update you as and when we win new contracts because they will be much more tangible. So I hope I answered your question. We are not adjusting the targets. We are very confident that we are on track to achieve them, and we will give progressive updates as and when we have new wins so that you can better calibrate our progress against those sets of targets.

Jesse, thank you.

Anyone else in the room with questions? Okay. So if not -- is there anyone else? Okay. If not, we'll adjourn the meeting. Let me just recap that we have really had a very strong set of underlying performance in 2025. And with a very strong order book, we are confident of our growth trajectory in the years to come as we have already articulated during our Investor Day and during our regular updates with you. We'll keep you posted of noteworthy developments. And on this note, thank you very much for joining us today, and we wish you a very good weekend ahead, today's Friday. Thank you very much.