Hello, and welcome to the D'Ieteren Group Half Year Results Conference Call. Throughout the call, all participants will be in a listen-only mode, and afterwards, there will be an audio question and answer session. Please note, this call is being recorded. Today, I am pleased to present Francis Deprez, CEO, Édouard Janssen, CFO, and Nicolas D'Ieteren. Gentlemen, please go ahead. Thank you very much, and a very good evening to all of you. As you've heard, we are operating under a new setup as of September 1st. So we have extended our executive committee to four members, of which three are at the table here. So myself, Édouard Janssen, who I say welcome, because this is his first—or no, his fourth or fifth working day since December 1st—September 1st. And Nicolas D'Ieteren, Chief Investment Officer, who's been around with us for about eight years, but also very welcome here. And of course, Stéphanie Voisin, our Head of Investor Relations, is amongst us as well. There are three key messages I would like to take away from this evening's call. One is that, we had quite strong H1 2023 results. Our adjusted profit before tax group share landed 46.5% higher than last year, reaching EUR 549 million, and we also generated a solid cash flow. That's message number one. The second message I would like you to take away is that we're revising our guidance slightly upwards. We now expect to land above EUR 960 million for the entire year. That does include some restatements on the number of items, among which long-term incentive plans, for around small EUR 50 million or so. This is de facto a upward revision of a good EUR 10 million-EUR 15 million, more or less, of what we had said before. And the third message was the one on the extended executive committee, which I already mentioned. The key highlights in terms of numbers, the 46.5% increase in PBT group share, includes, of course, PHE for the first time, and if you exclude PHE for those six months, it would have been +25.6%. That's important to keep in mind. Our free cash flow numbers are solid. I'm talking about EUR 186 million, mainly driven by Belron, by the way, and also the sale of Mondial Pare-Brise, one of the things, the remedies that the European Union has requested us to do at PHE, as well as positive operational improvements, of course, at our activities. Now, this outstanding semester is really driven by strong operational performance and some scope effect of PHE. The strong operational performance, particularly noteworthy at Belron, where our adjusted margin reached 21.9%. Remember, we were at 18% in H1 of last year, thanks to higher sales, strong cost control, and good measures in top and bottom line, in an inflationary environment, as you recall, since a good 12 months ago. D'Ieteren Automotive also with a very strong result, boosted by the upturn in production at the Volkswagen Group on one hand, and therefore deliveries to our customers. Finally, I would say, market share gains on top of that, a positive price mix effect as well, and also growth of the other mobility initiatives at D'Ieteren Automotive. So that leads to a record margin of 5.4% at Auto, or 42% growth in a PBT group share versus last year, H1. PHE, for the first time in our numbers, contributing EUR 78 million to our PBT group share, with a very strong top-line development, including pricing initiatives for an inflationary environment. We'll talk about it later. TVH, not surprisingly, with the cyberattack that's behind us, has a lower contribution to the adjusted PBT versus last year. It was EUR 55.6 million last year, it's EUR 36.9 million, so almost EUR 37 million this year. It is mainly the cyberattack, of course, with the interruption of a good 2.5 weeks that has led to that. And then last but not least, Moleskine. As we already mentioned in Q1, more cautious inventory management by our large customers, both online accounts and retail chains, especially in the U.S. But, they have done good cost containment, and therefore were able to increase their adjusted operating profits with about 23%. Nevertheless, if you take into account the financing costs for the internal shareholder loan that we have with them, and from which they, of course, also are charged interest charges, we do land at a negative PBT, at the end for the H1. And so following these outstanding results, we do now expect, as I mentioned already, to land above EUR 960 million, for the full year. But you should realize there are some adjustments, accounting adjustments included in that number. And so what, what used to be EUR 900 million before was more around EUR 950 million-ish, if you take all those adjustments into account. And, and so that's from around EUR 950 million, we're talking basically now about above EUR 960 million. How much above? We will see. So the highlight numbers as of page four, +65% in our sales group share. The top of the bill is D'Ieteren Automotive, with +48% almost, followed by PHE, +17%. Of course, for us, it's the first time in our numbers, but if you compare to their numbers of last year, it's +17%. +12%, more or less, for Belron. Still flat, slightly growing, even for TVH, at +0.4% and -6% at Moleskine. The translation of that in adjusted operating results group share, which increased +60%. Again, D'Ieteren Automotive leading the pack with +52%. Belron increasing about 36%. Moleskine about 23% higher than last year. Then the negative effect, as I mentioned, at TVH, of about 26%, due to the cyberattack. On page 6, our adjusted PBT group share, plus 46.5%. Basically, positive contributions mainly from Belron Automotive and PHE versus last year... somewhat lower at TVH and at Moleskine, and then corporate allocated is not much. What I think is important to note on the right-hand side of page 6, is that by now, about half of the contribution to the PBT is non-Belron. Belron is, of course, still very important for us and will continue to be very important for us. But thanks to our evolved portfolio, the non-Belron port is also now about half of the PBT group share, and I think that's not very important to note. The free cash flow generation at the group level has been strong. It's about EUR 186 million versus EUR 208.6 million last year in H1. It's mainly Belron and the sale of Mondial Pare-Brise. Important to note, and you can see it from the chart, the blue of the D'Ieteren Automotive is negative on H1. Not a surprise, because we really are in a phase of the car market where we're receiving many cars. Some of them are even receiving earlier than planned, and they may sit on our parking lots for a couple of weeks before we can deliver them to our fleet customers. We also have some constraints in actually delivering all those cars to private customers, because we haven't been used with anymore for about a year and a half or so. Last but not least, in free cash flow, the TVH free cash flow is slightly negative, but clearly better than it was a year ago. Sorry, before ESG, the debt setup and the cash position, a table we show you each time. We are sitting on some cash at the D'Ieteren Group. It's the number you see on the right at the bottom. It's basically EUR 934 million kind of as a cash position, but it's not all pure cash because part of it is shareholder loan. So it's about EUR 600 million, a good EUR 600 million, that we have real cash at the group. Of course, we are happy to be able to use that in the coming years for either new acquisitions or for helping our activities continue to develop. On ESG, we continue to make progress. Almost all our activities are in the Science Based Targets initiative already. Moleskine is, Belron is, Automotive is on its way. TVH has been working mainly on renewable energy. They have quite some buildings, and they're putting solar panels everywhere. Belron is starting to electrify its fleet of vans. Automotive is, of course, through its activities, doing a lot towards Project ZERO. As a group, we also are not only participating in the Science Based Targets initiative, but we're also part of the Carbon Disclosure Program, for which we did an assessment in this particular year. I suggest we go a little bit more depth through the different activities before we open it up for questions. I would suggest, Nico, as you, of course, been following Belron for quite a while in the past as well, if you could take us through the Belron slides. Thank you, Francis. Belron had a great first half in 2023. Revenues increased by 11.5% to EUR 3,024 million, and that's on the basis of an organic growth around 10% and contribution for acquisition from M&A around 2%, and negative forex effect of -0.6%. We had double-digit growth in revenues in Eurozone and rest of the world, a bit less, around 7% organic in North America. Volumes were overall positive in the group, was 1.5%, driven by the recovery in the U.S. opportunities in Q2, specifically, and a continuation of a good trend in Europe. You know, the work price increases last year, they clearly helped Belron in the first part of the year. What also helped is the strong growth that we've seen in revenue coming from ADAS, so recalibration, where penetration increased to 35%, coming from 28.6% a year ago. And the sales from VAPS, so the value-added products and services, were broadly flat at 22% of total revenues. Oh, sorry, of attachment rate. The margin was very strong, so the adjusted operating results came in at EUR 673 million. That's a 21.9% adjusted operating margin. That's almost a 4% increase from last year. So coming both from the excellent top line growth that the company has experienced and several cost containment initiatives and measures taken over the last six months. The adjusted net financial costs are about EUR 100 million, and take into account the additional debts that we've taken on board in April this year, for a couple of months. Adjusted EBT group share are EUR 286.8 million. That's almost a 35% increase year-on-year. You also have the details on the adjusting items that are EUR 84.6 million and coming from, as usual, the amortization of customer contracts, employee costs in relation to the RSUs that were awarded in December in 2021, and also EUR 44 million coming from the fees to system integrators as part of the transformation program ongoing at Belron, and also some one-offs. In terms of free cash flow, excellent picture here. Belron had a free cash flow of EUR 409 million for the first six months. That's more than double the free cash flow of last year, coming from the increase in EBITDA, obviously, and also positive working capital development for EUR 47 million. ... and the lower cash outflow from adjusting items for the race, for the rest. And that's partially offset by higher cash interest. I've just spoken about these, and CapEx and taxes. So the net debt increased mainly from the dividend that we pay consecutive to the new, the new debt that we took on board in April. The net debt to leverage – sorry, the, the secured leverage ratio is at 3.03 x at the end of June 2023, and so a fairly nice deleverage compared to the situation a year ago. All right. Well, thank you, Nico, on Belron. Moving to D'Ieteren Automotive, and I'll go right away to page 19 to give you a bit more of the details. The car market in itself has really been going up. It's increased by 35%. Finally, I would say, the period of shortage of vehicle components and the lower production of the Volkswagen Group is behind us. In that environment, we managed to still increase our market share to 22.9%, so 64 basis points higher. And also in commercial vehicles, our registrations increased to 23%, with a market share close to 10%. You can see it in a 15-year time frame, almost at 2023 H1 is back to a better vintage than the last three years that we went through since COVID. And also, our market share has set for a third year in consecutive, an upward trend. The mix of cars on page 20, again, very much in line with the last couple of years. The fuel mix continues to go greener and greener. We're talking 44% of the total now in new forms of energy, of which hybrids was a significant chunk. There was a particular change in fiscal policy in Belgium on July 1, and so already last year, but also still this year, until June 3, we've seen lots of interest for hybrid vehicles before that fiscal rule changed. But also electric, 37% of the 44% were deliveries or registrations of electric vehicles, so that's really been taking off. The buyer mix is and has always been, but it's more than ever, a B2B market in Belgium. Two-thirds, really 67% in H1 this year. So this is, of course, special to Belgium. And the SUV mix continues to steadily but surely become bigger and bigger, and has actually surpassed now half of the market with 52%. Our market shares on page 21 went up nicely in VW. Lots of deliveries of the ID. models in the meantime. Audi is holding good, a bit lower because the Q3, the A4, the e-tron, they, they've been around for a little bit, and so you have a bit less uptick, I would say, from newer models there. Škoda, very nice performance. Cupra, in particular, very nice performance. Porsche remains very high. 0.9% is actually high in historical perspective. And as I said, in the SUV mix, we always had a bit of a delay as the Volkswagen Group distributor to sell many SUVs, but with 21.8%, I think we're really getting close to the market average. In new energy, we are the market leader, and I'm very proud to be the market leader at 27.8% across the sum of our different brands, of course, Volkswagen being the number two. But if you add Audi, Porsche Taycan, and Škoda Enyaq, we are clearly the number one in the markets in Belgium. The rebound in sales to EUR 2.7 billion is a 47.8% increase. The 5.4% margin already mentioned in adjusted operating margin is really great, EUR 147 million. That's a really nice number. As you recall, we always want to be above mid- to medium-term, we wanted to be above 4%. Well, we've really beaten the 5% this time around in H1. H1 is always a bit stronger than H2, but for H1, I'm not gonna complain. Our adjusted PBT with EUR 141.5 million is really a very nice, or EUR 143.2 million, if you include the equity accounted entities, is really a good number. There are some adjusting items, EUR 8.2 million, for which they're typically linked to this restatement that we've done around the long-term incentive plans, which also exist at D'Ieteren Automotive. The free cash flow at D'Ieteren Automotive, not surprisingly, has remained negative at the level of the free cash flow. It was slightly positive at the trading cash flow. There have, of course, been some acquisitions, EUR 24 million. We actually completed our footprint on the Brussels Antwerp axis with an acquisition in the Leuven area with Jennes, and that was the payment of EUR 24 million, mainly, I would say, but also some bike acquisitions we have, but these are smaller amounts. Of course, the biggest change for Auto to look at is the working capital linked to inventories. The inventories have continued to go up. You may recall that in December, we had a negative free cash flow that surprised some of you. I can tell you by the end of January, that free cash flow was clearly positive again. But as of February, we started getting deliveries again, and that hasn't stopped. So since February, we've been receiving cars and cars and cars, and we're pretty happy because they are cars that were sold with real customers behind. It explains the growth in sales. But we are in the phase of the markets where, given those higher number of deliveries, we have just more working capital tied up in the value chain between Volkswagen and first us as an importer, then towards the retailer, and then from the retailer to the final customers. We have also, and that doesn't make our life easier, quite some erratic deliveries. So several cars which are supposed to be delivered, let's say in October, we've already received them, or we've received them. We were supposed to receive them in July, we received them in April. And so that means that for, especially for lease cars, where the lease contracts still go on for a couple of weeks or months-... We have those cars longer on our parking lots, and that explains partly why, at this point of the market, we do have more working capital tied up. At the same time, we also have some bottlenecks still in delivering cars to our end customers, because since COVID, we haven't had those volumes anymore, and it takes us a couple of months to get that back to order, but that's getting better and better under control. So that's the free cash flow generation impact that we've seen. And there was some debt level at Otto as well. It's around EUR 310 million at that level, and that's a healthy ratio to have. It's about 1.4 x the EBITDA over the last 12 months. For PHE, again, I suggest to pass over to Nico, as he's very familiar with the PHE situation. Okay, so PHE, strong set of results for the company. Revenue came in a bit shy of EUR 1.3 billion. That's a 17% growth year-on-year, driven by 12% organic growth and 5% from acquisitions, mainly in Spain. France is about 75%--65%, sorry, of of the revenues, and international, 35%, and both grew organically at about 12%. The adjusted operating profit margin was a high mark of 9.5%, and adjusted PBT at EUR 82 million, sorry, at EUR 78 million. Adjusting items for PHE, this first six months are at EUR 35.3 million, and that's primarily the amortization of intangible following the PPA after the acquisition and expenses related to the cash-settled share-based payment. In terms of cash flow, cash flow was good at EUR 17 million, driven by a strong operational result, and the divestment of Mondial Pare-Brise, that we closed, in, in the first quarter. These positive effects were offset by a negative impact on working capital from a very conscious decision to lower the use of non-recourse factoring of about EUR 103.4 million, just to decrease the, the, cash interest expense. Capital ex-- CapEx was at 1.7% of sales. Nothing to really mention here. The net debt declined very slightly at EUR 1.2 billion, and, that's a lender-based debt ratio of 3.7 x. All right. Thank you very much. Then move to TVH, and I'll go right away to page 30, where you see a bit the table with the numbers from which I can tell the TVH story. So sales came in, slightly positive, 0.4%, or really flat, actually, yeah. It's 0.5% organic. The cyber attack is in there, but actually also the CIS region. So Ukraine, Russia, of course, did have some weight, around EUR 50 million, before the whole war in Ukraine. While, of course, there's not much going on in Russia at all, and actually we've stopped that activity, and of course, Ukraine is also at a very small level of activity. There's 1.2% growth on the external side, so some acquisitions that are starting to play their role, and a negative 1.3% currency translation effect in those top-line numbers. The adjusted operating result of EUR 106 million is about a 13.4% margin, so clearly lower than H1 of last year, and that's the cyberattack, but it's also the conscious decision during and after the cyberattack to not put our foot on the brake in terms of future investments. So the personnel and SG&A that TVH basically had on board, we are really counting on them to continue for the future. And so we have not, like in the COVID times, I would say, of 2020, taken drastic measures to put everything on a break from that point of view. There are, of course, some recruiting freezings and postponements on that sense, but things that are important for the future, that's true for IT investments. That's also true, by the way, for CapEx investments. We have continued to do them at, at TVH. There are some adjusting items at the operating profit level of EUR 53 million. Part of it is the PPA, that, of course, now you see in our numbers, coming through customer contracts and other intangible assets. They are also on an transformation program. It's called Innovatis at, at, at TVH. With the cyberattack, we've, of course, postponed the implementation of that plan, but in terms of development of new software selection and setting up all the process design for that program, that continues to go on, and so there are some fees linked to systems integrators, about EUR 8 million in our adjustments here. By the way, we have now also fully impaired the TVH Russia activity. We had done some impairment already last year, but the last EUR 6 million of impairments here are also being taken in adjusting items. So as adjusted PBT, we are landing at the EUR 37 million number that I have mentioned before. The finance costs, as you can see, have also gone up a bit from EUR 5 million to EUR 14 million, more linked to, I would say, an additional level of RCFs that they're using in general compared to last year and some of the rates that have evolved there as well. The free cash flow and net debt situation at TVH, still negative, but clearly better than last year, so - EUR 18.7 million, but better. The improvement came mainly from a stricter inventory management at TVH now. Now, the lower operating results, of course, work the other way with them, and the higher CapEx also works the other way with them on overall free cash flow. The CapEx expenditures is about 6% of sales. It's been mainly an automation project that was already ongoing from last year and that we've now completed in Waregem at one of their major warehouses, and then the Innovatis transformation program, for which of course doing the right things for the future. The net debt has slightly increased to EUR 907 million due to the free cash flow evolution. And then Moleskine, last but not least, in terms of activities, we have a 6% decline in sales. We have similar to what we told after Q1 cautious inventory management by our wholesale customers, our retail chains, and online accounts. That was particularly true in Q1, a bit less true in Q2, but still there, and so that explains the -6%. But despite this, cost containment has worked quite well, and so the management team has been able to improve the operating results just at 5%, almost 23%. And that leads to a margin of 11.3%, which is higher than the 8.7% of H1 of last year. We have the shareholder loan to them, and they are, of course, charged some interest charges on that. That is also somehow linked to the EURIBOR, and so leads to a higher non-cash financial charges for them. If you take that into account, the negative, the adjusted PBT, sorry, becomes slightly negative at -EUR 4.6 million with Moleskine in H1. The free cash flow generation has been actually quite good. Their cash conversion is over 60%. They reached EUR 5.9 million positive free cash flow because they are managing the working capital quite strictly, and the net debt has been quite stable. Again, it's a shareholder loan with us at around EUR 278.5 million. You can see the details on page 34 in terms of the different channels. Wholesale is the biggest editor, of course, this cautious inventory management plays the most. See the partnerships, we still see some cautious budgets from business customers in ordering customized notebooks. Retail has done really well. It's been a nice growth almost more than 22% at retail. E-commerce grew nicely in the U.S., but declined in Asia, as Asia was actually coming out of lockdowns last year. Last year, they were in lockdown; this year they came out of it, and so they have a bit less e-commerce there. Americas is the region where they have the most difficulty. Europe had a slight increase at Moleskine. I think I've talked about the operating margin already, and what that means, and I've talked about the profit before tax as well. In the free cash flow, I think I've also given the numbers already. You see the details spelled out on page 36. To wrap it up before opening for questions in corporate and allocated, not many big changes. We have a somewhat higher adjusted PBT of EUR 8.6 million. Our real estate is, of course, part of that. We had some expertise costs of PHE last year. We didn't have them, of course, then this year. We have also some adjusting items related to share-based payment schemes. Sorry. And the net financial income was linked to the inter-segment, financing interest that we have with the TVH and Moleskine. Sorry, I'm taking a bit of water here. But as closing remarks, we have this year our usual seasonality, meaning in H1, which is a bit stronger than in H2, but it has been amplified, particularly by deliveries at D'Ieteren Automotive in terms of cars. And, of course, in H1, we saw this pricing effects at both PHE and Belron, particularly strong in H1, and that will of course normalize a bit more this year. However, our KPI for the first half year is higher than the full year of 2021. If you really think about it, we've made progress on ESG. We are increasing our guidance for EUR 960 million and I recall that I've not actually gone through the page with the details of that, but there are a couple of details on the guidance updates for activity. For instance, at Belron, we are now quoting at least a 200 basis points increase in the margin where we had set 150 basis points before. We are basically talking about D'Ieteren Automotive, where now we anticipate a market of 480,000 new registrations for the full market, and so we anticipate very high volumes there, even if we have some capacity constraints to deliver. And at TVH, we do anticipate that we will be in a more lower volume growth environment and in a profit margin that will still be in decline for the full year compared to what we were used to. And at Moleskine, we see basically a gradual recovery in the coming quarters, leading to a lower sales growth for the entire year. And with that, I would suggest I open the floor to questions. Thank you. If you do wish to ask an audio question, please press star one one on your telephone keypad. If you wish to withdraw your question, you may do so by pressing star one one again to cancel. There will be a brief pause while questions are being registered. And we have a question from Alexander Craeymeersch, from Kepler Cheuvreux. One moment while we open up your line. To you and the whole team. At Belron, we saw the leverage decrease already to 3.1 x EBITDA, which is close to your 2025 targets. Does that mean that there's additional room for cash upstream to the group level? Second question on Belron would be that you mentioned that the margin increase would be 200 basis points at least versus 2022 for the full year 2023, but why did you not put this higher? Do you expect some margin pressure in the second half? And if not, where would you end in terms of guidance if you are able to maintain that those current margins? Then maybe on, on auto, could you maybe tell us, how the change in legislation in Belgium with the hybrids not advantageously, deducted from, deductible from July onwards, how is that affecting your order intake and, and your results going into the second half? And does that also lower your expectations for 2024? And then maybe second question on auto would be, how you sustainable your 5.4% margins are, considering that you initially guided for margin erosion. And then maybe one question on TVH, which would be, on the cyberattack. What was the impact, on the profitability? Because, I mean, looking just at the margin decrease there, would it be safe to assume that margins would have been the same as last year, at least, and that the cost impact was probably more towards EUR 35 million on the bottom line? Thank you for those questions. Thank you. Okay. That's already quite a handful of questions. On the first one, with the three-point leverage, you want to say something, Nicolas? Yeah, it's an easy, it's an easy one, so I can take it for this. Yeah, so we, as, as you know, we have agreed of a deleveraged trajectory path with our partners, and the mark for 2024 is at 3.5, 3.5x. So we are lower than that, so we'll see if indeed, by the end of the year, there will be room for further shareholder remuneration. Yeah, but typically, we do those things once a year. We've done our thing in April, so we're more looking at next year probably rather than anything else. But as usual, it's a number of factors that we're looking at, including the needs for Belron, the market conditions, and a couple things like that. But so we're not necessarily deviating from our normal rhythm, I would say, at Belron. On the 200 basis points margin improvements for this year, well, a couple of, a couple of points. So the, the pricing effects were, of course, quite noticeable in H1, and they will start to normalize because, we kind of have a, I would call it an anniversary, but we had, many of these things taking effect as of the summer of last year. And so, that basically will reduce and normalize the pricing effect we have there. At the same time, at Belron, we wanna make sure that we kind of get a little bit out of this yo-yo effect of recruiting technicians, and then, they're we don't need them a bit less in the winter, and then we take them back in and on board and have to train them and so on. Now that we finally have a bit lower turnaround, turnover ratios with them, we're gonna see to what extent we cannot play that a bit smarter, and that might lead to maybe some more marketing investments on the one hand or some lower productivity in a couple of months later. So as usual, by the way, in Belron, H2 has a lower margin than H1. This was not the case last year, but that was an abnormality. If you look at the many of the previous years, that was a normality, so you cannot take the 21.9% as the margin for the full year, so... And that's the reason why we're basically guiding to, to, to be, a bit above, the 200 basis points. All right. On the, on the, questions around auto, the hybrids, yes, everybody was, of course, fighting for orders for hybrids before the thirteenth of June, and we did our bit in that, and it worked very well. I think our order intake for H2, of course, you will have less hybrids orders, that's for sure, but we have enough other modules, I would say, in the catalog to offer. So you asked about impact for 2024. Not necessarily. I think the overall—we had a high order book at the end of December. We still have a high order book at the end of June. This was over 90,000 cars. Of course, that will go down, but, and the overall level of orders in the Belgian market will probably be a bit lower in 2023 versus in 2022. But, it's not something that—I actually would say that if you take the combination of our high order book and the level of orders that we anticipate to get in this year, this will set us up for a, for a good 2024. So, it's not that we're suddenly getting worried about 2024. The 5.4% margin, though, is, of course, not representative for the entire year, and so our slight margin erosion for the entire year, we are sticking to that. We're not expecting a high change versus that, because we're also having some restatements in our numbers. And so, that explains maybe the difference that you might see—that we don't change our guidance on the overall margin erosion. But typically, again, in the auto, H1 margin is higher than H2 margin. I think that was the case last year. We had 4.8%, I think, in H1, and then we ended up the year below 4%, and so we'll see where we'll land this year. And then in cyber, the cyber impact, well, we have about, I would say, an 85%, EUR 85 million top-line effect, probably, in terms of top line during those difficult weeks. That had a negative flow-through, of course, in those months, and you see that in our H1 numbers. I think for H2, we are now more driven by, I would say, what's going on in the different markets, the different verticals and the different regions that we are. And it is true that in several of the verticals and in several of the regions, we don't necessarily have the same volume growth anymore that we had across the board, I would say, in the last year. And also the full price effect that you may have had last year and early this year, we also have a bit less of. And therefore, we see a more differentiated picture between the different regions and the different verticals, I would say at TVH, and that what leads us to a somehow lower volume growth environment. Still volume still growth and still volume growth, but less than maybe what we have seen prior to the cyber attack. But that is now exactly the EUR 35 million number that you put in your, in, that you mentioned. It's really more I would really say, no, I mean, the margin decrease that we've seen in H1 is clearly linked to the cyber attack, and so we should not see that same delta going forward, of course. It's fair to say that margins would have been at 18%, excluding the cyber attack? I have not done the exact calculation- Operating. But, margins are. We're stable in our outlook, and that has not, in that sense, had not changed if we had not had the cyber attack. Okay, that's perfect. Thank you, Francis. And, again, congrats on the nice results. Thank you. Thank you. Our next question comes from David Vagman from ING Belgium. Please go ahead. Yes, hello, good evening, everyone, and thanks for taking my, my question. First, in general, overall, when looking at your full year guidance, I estimate this implies very little, little growth of the adjusted PBT in, in H2, and, and even I would say maybe low single digit, growth, adjusting for PHE. So, so if we could look a bit at each participation and, and, and, and of course, probably more on, on Belron margin, the discussion for H2 and, and on TVH. So if, if you become particularly careful about the, the end market. Then second question on the, the margin expansion at, at Belron. Could you explain us or quantify the impact of the LTIP, reclassification? So maybe another way to look at it alternatively, is to look at what was, what were the EBIT margin in H1 in 2022 and in 2022 overall, if they are being restated. So how, how the picture look like in terms of margin expansion, you know, on, on a restated, basis? Then last, question on TVH and the variability of cost there. What was the impact? I, I think you, you give some idea, but the impact of the, the total Innovatis impact on the adjusted EBIT, I, I think it's about EUR 12 million, if I'm correct. And what could be the impact for the, for the full year? Overall, yeah, if you could help us better understand the cost variability, so on the gross margin side, but also the OpEx, the SG&A, et cetera. Thank you. Okay. Thank you, David. So on the Belron margin, I mean, there is actually no restatement effect on LTIP or on the long-term incentive plans, because that was already, of course, they've been going on for a couple of years with their incentive schemes, and there's no change and no restatement whatsoever in their numbers. So it's more PHE and a bit of Otto, and so on, where you have that. Then at TVH, variability of costs. Well, the biggest cost is personnel, of course, and then SG&A. And in personnel, they are a growth company, and so of course, their recruiting plans have been ongoing, and they've been more playing with hiring freezes, I would say. Now, before continuing the recruiting, they're really turning every request 2 or 3 times around before saying: Is that recruiting really necessary? And so the variability of costs at the personnel cost, I would say, first of all, we had, of course, 2,000-3,000 of the 500 employees of TVH, they're based in Belgium. And so we had the inflationary adjustment at the first of January, as we all had, with around 11%. And so that's kind of a fixed cost. But then the number of people that you have is more about, are you gonna recruit less going forward, or are you not gonna replace when people leave? And so they've been becoming a lot more stricter. But it's not something where you see an effect immediately in 1 or 2 months. And so the way they can play with the variability of the personnel cost is just by postponing recruitments, basically, and asking people to have to do it with a bit less resources, so to say. Which you can only do to a certain extent, because it's an ambitious company with many projects, very important projects, and we want to continue to invest. And so it is not that it is a recruiting stop. The second part of the variability of cost at TVH is more the SG&A. And I think one of the elements that they have been spending money is the Innovatis program, and that program continues. And so even though they have delayed the deployment dates for that program, they are continuing to redesign processes, they're continuing to program the software, to select the software, to get ready for deployments. And so that means that the quote-unquote, "burn rate" of these things have not fundamentally changed. You could, of course, do that and put it on hold, but all you're doing is creating a bigger problem tomorrow. And so that's not necessarily what you're doing. On the growth margin of TVH, there is actually not much change. Their growth margins are actually good and solid. And if you see variations, it's more, as you said before, mixes you may have between the agri markets versus the MPA markets versus the construction market and so on. And so there, we have not seen big changes. There you are more dependent on how fast are you growing in the newer verticals versus versus not. Thanks very much. If I can come back on the overall adjusted PBT growth in H2, it's fair to assume that you expect only very limited growth in H2? Well, the growth in PBT is, is of course, a reflection of the fact that we anticipate continued great stuff at Belron, at Auto, and at PHE, but that somehow we are more cautious at Moleskine and at TVH. In particular, what we've kind of lost a bit at TVH will also have its mark on the full year. That's why if you take the sum of those elements, you may end up to the conclusion that you're ending up with. As I said, we're not saying around EUR 960 million, we're saying above EUR 960 million. How much above? We'll see. Mm-hmm. Okay, thanks very much. Thank you. One moment while we open our next question. We have a question from Michiel Declercq from KBC Securities. Please go ahead. Yes, hi. Thank you, and welcome, Édouard and Nicolas as well. My first question would be a bit on Belron and some comments that you gave earlier. Is it correct to assume, because you mentioned that you want to have a bit less yo-yo effect for the technicians, let's say. Are these technicians that were already hired in the first half of the year, and that this will continue to be employed in the second half, and because you have lower volumes, will create the margin pressure? Is that correct? That would be my first question. And my second question on Belron, a bit of a follow-up, is, I think in the first quarter of the year, in the first half, you had a bit of volume impact in the U.S. as well. How do you expect that to evolve in the second half of the year? Has your shortages been completely improved, or are you fully staffed right now? And then maybe a third question would be on the auto division. If I look at the deliveries and the sales from new vehicles, it looks like you have another very strong price increase or average price per vehicle. I was wondering if it's because of the EV or the hybrid boom, which come with higher prices. And my question will also be, do they have a big difference in growth margin? Or what part of the overall more than 5% margin was driven by growth margin improvements? So, these would be my questions. Thank you. Okay. Well, on Belron technicians, I mean, this really plays out more towards the end of the year, because we still have some very busy months in the summer, typically, and then in October-ish, and so on. So it's more towards November and December that you could have quote, unquote... And these technicians would not be sitting idle, yeah? So we would, of course, do the right marketing spend and see whether we can actually create the right number of jobs. So we're not gonna have people sitting idle. That's not at all the point. It's just that we had a relatively low volume increase in H1, and we actually did not overspend too much in marketing either. And so in H2, we do anticipate to spend a bit more on marketing, and see what the volume effect of that will be. And we will, of course, adapt our technician capacity to that. So that's what I meant with avoiding a little bit the yo-yo effect. And so the volume effect, as you know, we budgeted for not much volume increase this year. We had exactly that in quarter one. We had a bit more in quarter two, and I think we're seeing a more and more of a normalization for Q3 and Q4, from that perspective on. So that's what I meant. But we will be spending a bit more on marketing as well, and so you may see some productivity technician stuff in more November, December. That's why we think we would see a more normal margin, a trajectory at H2, but higher than before. So I did say at least 200 basis points higher, so it's not nothing at Belron. That's, I think, the Belron thing. On auto, average price increases. Well, our mix has been normalizing a bit more than a year ago. So yes, we are still delivering cars that come from an order book where there were few discounts to be given, where you do have electric vehicles, which on average are a bit more expensive than maybe their combustion engine equivalents. So yes, that price effect does play its role and does play its contribution to margins. Now, it's not that our gross margins are fundamentally higher than they were a year ago, that would explain the 5.4%. As I said before, it's a contribution of a number of factors at the import level, at the retail level, at the new forms of mobility level, that have contributed to the overall good numbers of auto. It's not only the mix of cars. Okay. Let's maybe quickly coming back towards the that margin on Belron in the second half. You mentioned that margins in the second half should still improve? Because if you take the 200 basis points, at least guidance, that would actually remain roughly flat compared to the second half of last year. It could improve compared to H2 of last year, of course, because you will not get to the 200 basis points if you would go down from here. But, last year in the second half, it was also around 18%, if I'm not mistaken, so. I think it was 18.5%, if I'm not mistaken. I don't have the exact number. Yeah, 18.5% in H2, which made us land at 18.2 in total for the year. And so you should compare the 200 basis points to the 18.2%, which was the number for the full year of last year. Okay. Yeah, I thought you were talking specifically about the second half, but that's, you know. Thank you. ... Thank you. As a reminder, if you wish to ask a question, please press star one one using your telephone keypad. One moment while we open up our next question. The question comes from Kris Kippers from Degroof Petercam. Please go ahead. Yes, good evening. Thank you for taking my questions. Out of the advantage, when you're later, a lot of questions have been asked. Two remaining from my side. Firstly, looking at PHE, what is the strategy going forward for the reverse factoring? What the amount that has been reduced is EUR 104 million, so what is still remaining? And would it imply that you would not reverse this going forward? My second question, also a bit cash flow generation driven. If you would take out all the exceptional items you had in H1, meaning the working capital hiccups in Auto, also indeed, PHE, but also certain CapEx effects, is it fair to assume that actually underlying free cash flow was actually quite strong? Just as a small follow-up, on the group level, we see a gross cash position now of about EUR 900 million. How will you spend it, given the free cash flow improvements, towards, I would say, yeah, Q1 2024, probably? Thank you. I can take the first one on the non-recourse factoring program. I think this program is around EUR 200 million today. It's used historically at a level around EUR 150 million. I think structurally, we're gonna be lower than that going forward, more in the EUR 100 million, and we see that as available liquidity, really. So we're not gonna change the program. It's still gonna be available, but it's just gonna run at a lower end at the number which is going to be structurally lower than historically. Yeah. Okay. Free cash flow. Yes. Yes. If you take out the exceptional, yes, you would have a nice level of free cash flow, of course. And on the cash, well, not all of the EUR 900 million is cash. Shareholder loan is in there, so it's EUR 612 million cash, and we will be using it as we have done in the last couple of years. That means we are always looking at opportunities to either add an additional growth platform to our group, or to help our existing activities in the development if they go beyond their free cash flow that they generate themselves. So we always have an open ear to their ideas and suggestions of the management teams over there. And so, while of course, continuing our dividend policy, which is unchanged, that means we wanna go up if results permit. No change in that either. Our capital allocation policy has not changed with the number of EUR 600 million cash that we have at hand today. Just coming back on that last question. If you look at some of your startups or, well, no longer that much startups anymore, but some, yeah, medium-sized companies, for example, is there one of those companies that could be, a candidate to become a, a new pillar going forward when you go, I would say, out of Belgium, for example, for some of them, on a pan-European level? Is that an option or is it not on the cards? You may be referring to some of the activities that indeed in Auto that are local today and could be coming- Correct. international tomorrow. I mean, honestly- Yes ... these are really much smokier things, so no, no, I'm not talking, I'm not thinking about that. So we'll be more thinking about, more transformative M&A at the level of one or multiple of our existing activities, not just the business development, for one or the other small, scale-up or startup. Yeah. Okay, very clear. Thank you. Thank you. We have one question. One moment while we announce you. The question comes from Mr. David Vagman from ING Belgium. Please go ahead. Yes, hello. Hello again. Sorry to come back on the Belron EBIT margin for H2. I didn't quite catch what you were saying. Do you expect the margin in H2 to be stable, compared to last year, I mean, year-on-year? I had a question on the Auto in general. Okay, we've seen this working capital fluctuation. We also see the CapEx increasing. How should we be thinking about the long term, some of the 2025 free cash flow targets? Any reason to be more cautious? Thanks. I honestly haven't done the calculations specifically for H2 at the moment, because it's, we're really focusing more on the full year number- Mm-hmm ... than on what specifically happened between July and December. But again, on the overall year, it should be 200 basis points higher. But I think if you do the math, that does reflect somewhat higher margin, I think, in H2, because we're 300-something basis points higher on H1. Mm-hmm. We were basically wanna get to 200. For six months, we need to do higher than last year as well. So yes, it should go up with a reasonable amount, I would say, a reasonable number. Thanks. The free cash flow, that's Auto free cash flow 2025 that you're asking, huh? Yes. Mm-hmm. Well, we, we... I, I, I do anticipate that this effect of more working capital in the system and, erratic, including, including early deliveries of cars, will persist throughout the end of the year and still part of next year. I would really hope that by the end of next year, we are really more in normal territory. So far, when you talk 2025, there is no reason to think that why the, the free cash flow profile of Auto would be structurally different than what it has been in the past. As you know, we've had, had multiple years where it was really a cash generator at D'Ieteren Automotive, and this is not gonna change once we go through this phase- Mm-hmm ... of erratic deliveries. Mm-hmm. And, and on the CapEx side, you, you're still, let's say, on track? CapEx at Auto is actually not that high, we have, I think we had. Sure ... 1% as part of it. So there's no nothing particular to note on the CapEx side of Auto. Okay. It doesn't need be. I mean, basically, in H1, you should know that the CapEx spend, to a large degree, was actually that we've added quite some vehicles at Poppy, the car-sharing activity. Which, by the way, we may still think whether we really want to keep this as an asset buy or it's not smarter to put it on a leasing formula. But we'll see a bit what we will do with that. But that has been the main driver, and this is really more of a one-off thing than anything else. We're not gonna- Mm-hmm ... adding thousands of cars in an environment where the competition has also increased for Poppy in Brussels, for instance. Okay. Very clear. Thanks a lot. Thank you. At this moment, we have no further questions. I will like to return the conference back to you. Well, thank you all very much. Thank you all. And wishing you all a great evening, and I'm sure we'll be in touch in the coming days and weeks, with at least some of you. Have a great evening. Thank you. This now concludes our presentation. Thank you all for attending.