Ladies and gentlemen, welcome to the Bossard Group presentation of Bossard's Semi-Annual Result 2025 Conference Call. I am Sergeant, the Chorus Call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and then one on your telephone. For operator assistance, please press star and two. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Dr. Daniel Bossard. Please go ahead. Thank you very much, and welcome to the Semi-Annual Results Webcast 2025. Today, we would like to provide you an overview of the highlights 2025. Stephan Zehnder will give you an overview on the financials before I will continue with the Strategy 200 progress, a little bit of insight into the U.S. tariff impacts, and finally with a focus on 2025, followed then by a Q&A session. I'm happy to start with the highlights 2025. Basically, we have two areas. One is the overall market developments and then what happens within Bossard. On the market development side, you have all heard and seen a challenging market environment with ongoing geopolitical and economic uncertainties. We had an initial stabilization in Q1, but this was until the debates on global trade came on with the tariffs, which caused demand to decline in Q2 in general. We saw regional differences. We saw, for example, Asia in general, India, Malaysia booming. India because of long-term geopolitical trends shift from China to India, but also Malaysia, which provided quite some incentives for companies moving over from China to Malaysia, namely the semiconductor industries, which created positive demand dynamics. Europe and America, we had the tariff headlines, as mentioned before, which caused pretty high planning uncertainty. We saw weakening demand, especially in export-oriented and cyclical industries. We saw a significant Swiss franc appreciation and, of course, depreciation of the euro and U.S. dollar accordingly, but also a sustained demand for automated data-driven C-parts management solution because of inflationary trends in many countries, namely in the U.S. Automation was and is in high demand. On the Bossard side, we see also, of course, a challenging market environment, as just mentioned, but also a lot of opportunities, speed in certain verticals like aerospace, like railway, like electronics, robotics, but also in certain countries, as I just mentioned before. There's still tons of opportunities. We benefited from a strong demand in Asia. The group, of course, drove growth in Europe through the acquisitions, as we announced earlier. We also faced a sales decline in America. We see an accelerated implementation of Smart Factory system services across the globe, which enhances our customer relationships and differentiates us further in the market. We did take advantage of the ''Make in India'' trend and nearshoring in Malaysia, particularly in the semiconductor electronics verticals. We saw a strong pipeline and conversion in the aerospace field, so it's airplanes, helicopters, drones, etc. Also, of course, the acquisition of Ferdinand Gross in Germany, which adds EUR 80 million sales on an annual base with roughly 260 employees. This is a bit the highlights of the market and Bossard. With that, I'd like to move on to the financial review, which will be provided by Stephan Zehnder. Stephan, please. Thank you, Daniel. Good afternoon, ladies and gentlemen, and also welcome from my side to this conference call. As Daniel mentioned, the first half of 2025 was marked by a challenging market environment driven by geopolitical and economic uncertainties. After signs of stabilization in the first quarter, the ongoing trade conflicts and tariffs led to a decline in demand during the second quarter. We saw different trends, sales trends in different regions. In Asia, the Bossard Group benefited from the positive demand dynamics. In Europe, successful acquisitions led to the satisfactory growth, whereas in America, a decline in sales was recorded. In these volatile market conditions, the Bossard Group achieved sales of CHF 547.9 million in the first half of 2025, an increase of 7.6% compared to prior year, whereby the currency impacted the sales development negatively by 2.3%. The appreciation of the Swiss franc over the recent months has resulted in an increasingly negative impact during the first half of the year. In the second quarter alone, the negative currency effects amounted to 5.6%. Organic sales declined slightly by 1.3%. The acquisitions made over the course of the last 12 months contributed 11.2% to the sales growth. Despite a demanding and uncertain economic and geopolitical situation, Bossard benefited again from having a broad and global customer base and being less dependent on a single industry. The Bossard Group grew well in the railway, aerospace, and semiconductor-related electronics industries. Also, the demand for digitalized and automated C-parts management systems did continue. With Smart Factory solutions, Bossard and its customers are able to make a valuable contribution to increase their productivity and profitability, especially when labor costs increase and greater resource management is becoming more challenging. In the first six months of 2025, the business performance was not only influenced by the challenging market environment, but also by accounting adjustments related to the acquisitions. The so-called purchase price allocation, or in short PPA, is mainly related to inventory with a temporary negative impact on the gross profit of CHF 3.1 million in the first half of the year. Despite the increased volatility and price intensity, the adjusted gross profit margin, excluding PPA effects, amounted to 33.2% and was therefore holding well at prior year's level of 33.3%. The gross profit margin, including the PPA effect on inventory, was at 32.6%. In line with the group's growth, sales and administrative expenses increased from CHF 111.4 million- CHF 123.1 million. At the same time, the number of full-time equivalents increased from 2,886- 3,129 due to the acquisitions made. The increase in costs was primarily due to the acquisitions and the investments in the rollout of the new ERP system. This included also higher license fees to accommodate a greater number of system users and expanded commercial support required during the implementation phase. Investments under Strategy 200 continued with particular emphasis on digitalization and efficiency improvements. Regardless of the challenging market environment, the lower gross profit margin caused by the PPA effect and higher costs had an impact on profitability. The adjusted EBIT, which excludes PPA effects on inventories and intangible assets, reached CHF 58.8 million in comparison to CHF 58.1 million, which results in an EBIT margin of 10.7%. Including these effects, EBIT was at CHF 55.5 million, corresponding to an EBIT margin of 10.1%. The financial results amounted to CHF 5.6 million in comparison to CHF 3.1 million in the previous year. Even though net debt increased markedly, the overproportional increase in the financial result is fully attributable to the strengthening of the Swiss franc, which led to negative currency impacts. Compared to prior year, net income decreased from CHF 42.4 million- CHF 38.7 million. As already mentioned, we experienced different sales developments in the three market regions in the first half of the year. In America, Bossard recorded an 11.4% decrease in sales, amounting to CHF 114 million for the first half of 2025, compared to CHF 128.6 million in the previous year. In local currency, sales declined by 8.4%. While there was a positive sales trend to observe in the electronics sector, demand remained weak, especially in the areas of electromobility and agriculture. In addition, the constant changes in tariffs and news led to market uncertainty, which had a negative impact on demand. The appreciation of the Swiss franc had an additional negative impact on our results. In Europe, sales increased by 14.8% and in local currency by 16.6% to CHF 373.4 million, compared to CHF 293.8 million. When adjusted for acquisitions, there was a 2.9% decline in local currency. This trend is becoming more pronounced in the second quarter due to tariff challenges and broader economic uncertainties. The aerospace and railway sectors achieved satisfactory growth rates. Bossard was able to further expand its market position in both industries and further strengthen the aerospace sector with last year's acquisition of Aero Negoce International. In Asia, Bossard recorded a sales increase of 10.9% and a strong growth of 15% in local currency, reaching sales of CHF 96.5 million compared to CHF 87 million in the previous year. The region maintained its upwards momentum into the second quarter, as evidenced by a sustained double-digit growth rate. In India, the company benefited from the ''Make in India'' initiative, while in Malaysia, customer nearshoring, particularly with the semiconductor and electronics sectors, contributed to this success. Growth in China was driven by rising demand, notably from the electronics and machinery sector. Additional promising opportunities were identified across automation and robotics, and new local customers were acquired, supporting Bossard's advantage from growing intra-Asian trade. Upon review of the balance sheet, total assets rose from CHF 835 million- CHF 914 million. This is primarily attributable to the acquisitions completed during the comparative period. The equity ratio decreased from 47.4% in the prior year to 39.1%. The reduction was also driven by the goodwill paid for the acquisitions. Under the accounting standards applied, Bossard is netting the goodwill from acquisitions against the equity, which amounted to CHF 48 million in the comparable period. Without considering this impact, the equity ratio would have been at 42.1%. Even though the equity ratio decreased, it still underscores the group's continued solid capital structure. We expect that the equity ratio will increase again over 40% over the course of the second half of the year. Compared to last year, the operating networking capital increased from CHF 479 million- CHF 502 million. Whereas in relation to sales, the capital intensity increased from 47.9% in 2024 to 49%. However, adjusted for acquisitions, the operating networking capital as a percentage of net sales decreased from 47.9%- 46.4%. With a focus on the balance sheet ratios, year-over-year net debt increased from CHF 239 million- CHF 347 million. The increase was primarily related to the higher operating networking capital and the acquisitions made in the comparison period. The gearing net debt measured against equity increased from 0.6-1, whereas net debt in relation to EBITDA increased from 1.9x-2.8x, which is noticeably beyond our conservative set long-term funding ratio of 2x. The KPIs are closely watched and managed with a clear focus to improve in the coming months. In the first half of 2025, total capital expenditures amounted to CHF 16.8 million. Thereof, CHF 1.8 million were spent for office and warehouse maintenance and investments related to ESG initiatives. An amount of CHF 3.8 million was allocated for replacement investments within ongoing operations. We invested CHF 3.1 million in smart devices, installing them at our customer sites as part of our Smart Factory solutions. We invested a substantial amount of CHF 8 million into our digitalization initiatives. The biggest share of this investment was dedicated again to the rollout of the new group-wide ERP system. In May and June, we have successfully completed rollouts at Bossard Aerospace in Germany and Bossard Vietnam. Additional deployments are planned for the second half of 2025 in Poland, the Czech Republic, Austria, and India. Finally, a look at the cash flow statements. Despite the lower profitability, the cash flow from operating activities before changes in the networking capital increased slightly from CHF 55 million-CHF 56 million. On the opposite, the cash flow from operating activities decreased from CHF 46.3 million-CHF 32.7 million. This was mainly due to the less pronounced decrease in operating networking capital compared to last year, and in this case, especially inventory, but also due to the acquisitions made. Cash flow from investing activities totaled CHF 77.1 million compared to CHF 33.4 million in the prior year and was significantly higher due to the acquisition of the Ferdinand Gross Group at the beginning of the year and somewhat higher investments in property, plant, equipment, and intangible assets. Overall, the first half of 2025 resulted in a negative free cash flow of CHF 44.4 million after the prior year's positive free cash flow of CHF 30.9 million. Without considering the cash out for acquisition, a free cash flow of CHF 14 million was achieved. With that, I would like to hand over again to Daniel. He will provide you a brief update on the progress of the Strategy 200 and where we focus at in 2025. Thank you for your attention, and Daniel, please. Thank you, Stephan. Happy to step in. Strategy 200 is probably known to most of you. It's an ambition that we follow by 2031 when Bossard turns 200 years old. That's why it's called Strategy 200. It is about accelerated, profitable, and sustainable growth based on our proven business model, organically and through acquisitions. To provide you a little update or view on the long-term development, I'd like to highlight the following chart. It shows the 20-year development of the Bossard Group in sales and in EBIT margin. A few things to highlight here. One is the red bars that you see here are the global recession, which is basically a PMI below 50. You see 2009, 2020, 2023, 2024, and into 2025 are still in the red zone, which basically means headwind. The second is you see the overall developments coming from an area of CHF 400 million-ish- CHF 600 million-ish- CHF 800 million-ish-C HF 1 billion-ish sales in the last couple of years. Step-by-step development. The third thing is the EBIT margin developments that we've seen over the years have been from a neighborhood of 5% up to kind of 10-12%. Always, whenever we face some headwind, always a bit under pressure, also given the investments, the special investments that Stephan just iterated before. What we haven't also shown here is the currency effects. In the last 20 years, we have seen a depreciation of the dollar and the euro in the neighborhood of 30% also over these years. Just to give you a bit of a perspective into the last two decades and where we are today. With that, we also grew with acquisition, and we announced the acquisition of Ferdinand Gross at the beginning of the year, which provides us an additional EUR 80 million of annual sales with a customer base in many traditional industrial areas, but namely also in the railway industry. Ferdinand Gross is a major supplier to Deutsche Bahn for infrastructure and railway maintenance, and in that sense, for us, a very good investment into the future, particularly in the maintenance of railways. Ferdinand Gross has a strong market presence in Germany, but also it enhances our strength in Hungary and Poland. The deal was closed in January 2025. The strategy, after all, also is about achieving relevant market shares in our key markets through our seven strategic initiatives, which are, by the way, also described in detail in our investors' handbook available online. The seven initiatives include the topics you see here on the slide, but we would like to highlight two elements, which are, one, the operations engine, and, second, the sales engine. I'm starting with the lower part on the operations engine side. On the operations engine side, we have overall continued to implement the ERP system Next E365 in 14 business units across the globe. So 36% of the business is now covered with the new ERP system. In the first half year, we have successfully rolled out the aerospace Germany unit and Vietnam, and Poland, Czech Republic, Austria, and India are planned for the second half of this year. We plan another nine rollouts in Europe and Asia by the end of 2026. By then, we should have a business coverage of 2/3 or 67%. Furthermore, on the operations engine side, we use AI to further innovate process automation and intelligence tools to increase our efficiency and transparency. On the sales engine side, next, we continue our focus on growth verticals, which are verticals like railway, robotics, semiconductor equipment, and aerospace. There is a strong shift towards digital lead generation and higher conversion rates using our existing CRM system globally and also enhancing and enabling our people to use it more effectively in order to increase the conversion rate of our pipeline. Basically, do more with less people. The demand for Smart Factory and automated data-driven C-parts management solutions was carried on. This is on the sales engine side. Furthermore, talking about Smart Factory, you know our Smart Factory Logistics services, which are here to avoid stockouts and reduce inventory costs. We have had this service in place for 27 years. Looking at the numbers on the next slide, we have now a base of around 475,000 smart devices installed, doing roughly CHF 275 million in turnover through the system. This is about 27% of our sales with a bit more than 1,100 customers globally. This trend continues, and we have also won 33 new customers in the first half of 2025. Shifting over to Smart Factory Assembly, this is a new service, a relatively new service since a few years, which is here to avoid mistakes and increase efficiency in assembly by providing electronic work instructions to our customers. Looking at the numbers here, we have been able to grow by nearly 50% overall and are currently working with over 100 customers and over 250 systems installed. This system is growing exponentially. You can imagine the need for automation is increasing, and with this, we can also create further peace of mind at customers and create further customer loyalty. Particularly also with the current trend of higher prices and inflation, this has a certain additional importance right now. Now, also connected to the U.S. tariff impacts, which will create some inflation, here the situation is the following. Overall, we are looking at around $50 million of imported parts into the United States. Here, we're not under the reciprocal tariffs, but we are clearly under the aluminum and steel tariff regulation, which is in place since March 12, 2025. At that time, 25%, and since June 4, it's actually doubled up to 50%. Right now, we're in the regulation of 50% tariffs on aluminum and steel, which is valid for fasteners. In addition, we've seen a U.S. dollar depreciation of about 10% since then, accelerating. That means we have to face a cost increase of about CHF 35 million with those tariffs. We have the clear guideline to pass through the price increases to customers. That means price increases to customers of 10%- 30%. You can imagine that's not a walk in the park. Coming back to large customers, telling them to increase prices by 30% is a negotiation process, which we started in March, which then finalizes at the point where you agree on price increases over a certain period of time because you still carry stock. This takes some time. The full effect we can expect to come in around September because, again, also those price increases have some lead time. The clear guideline is to pass on all the price increases to customers. We try to localize imports. Basically, instead of importing parts to buy locally, we realized that this is not possible due to limited capacity in the U.S. or due to much higher prices, up to three times higher by sourcing them in the United States. That's literally impossible. The EU imports are still under negotiation. China imports are kind of negligible because they make about CHF 2 million, and we can widely localize in China. Whatever we import from the U.S. to China, we can basically localize in China. I think what's even more important is the global insecurity around those tariffs and the market shifts. That weighs high on Mexico and Canada because a lot of customers in Mexico and Canada have shifted their production over from Asia closer to the United States, to Mexico or Canada. Now they have to decide whether they expand their production. Due to the tariff insecurity, they wait. Basically, they wait for the dust to settle and see what happens. A lot of our customers are insecure. They don't invest further. It means also they don't ask for more fasteners right now. This tariff regulation impacts the global economy. Swiss, EU, and China exports to the U.S. are impacted by those tariffs. In a nutshell, we pass on the price increases. Our expectation is that this has a wider negative impact on the global economy, which we need to manage. With that, I'd like to close up with a focus for 2025, which is basically clustered in four areas, one being the sales engine. We put a little flash to it because this is probably the most unpredictable right now because of the whole geopolitical situation. Our ambition is to grow above market average with the industries that are growing above market average, which is railway, which is semiconductor business, which is electronics, and aerospace. On the operations engine side, I've already mentioned the successful introduction of our ERP system in seven more business units in 2025. This is a huge project involving hundreds of people and quite a high investment. We will go through this. We have already implemented half of the units almost, as you've seen. This is very important moving forward this year. On the cultural side, we're further anchoring our guiding principles, which means better collaboration across the globe using the same amount of people to do more. Also, on the sustainability side, obviously, we still need to comply with the reporting standards, CSRD, which we do. It's quite some effort. We continue that. We do what we think is right to do, and we also report what is needed to report. The main focus being for this year on the sales engine and the operations engine. With that, I'd like to have a few words on the midterm financial targets. Again, our organic sales growth target is above 5% in the mid to long run following the Strategy 200. Our operating profit margin, EBIT, is still targeted at 12%- 15%. For that, for sure, we also would need some tailwind at some point. Also, the high investments being passed. We have an equity ratio of about 40% on our target. As you know, whenever we had an acquisition, this can fall below shortly, but we'll recover fast. We stick to the dividend payout ratio of 40% of net income for the future. With this, I'd like to close, and I'd like to open for a Q&A session. Ladies and gentlemen, we'll now begin the question- and- answer session. Anyone who wishes to ask a question may press star, followed by one on your telephone. You'll hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. Anyone who has a question may press star, followed by one at this time. We have the first question coming from the line of Christian Bader from Zürcher Kantonalbank. Please go ahead. Yes. Good day, gentlemen. I have three questions, and I'd like to do them one after the other. First of all, I would be interested to hear whether you could give us some flavor about how the demand developed in the third quarter so far. That's my first question. Thanks for the question. We have certain industries, and that's a good question, by the way. We have certain industries where we are confident that it will grow further and nicely, which is, as mentioned, in the aerospace, which is in the railway, where we have a longer-term order book, which is one of the few we have in Bossard. Usually, our visibility is very, very short. We know there are verticals in the robotics and electronics sectors which are growing, and there are markets like India and Malaysia which are growing nicely. For the rest of the regions, we simply don't know what's going to happen with all the tariff impacts now, particularly on the EU. Our visibility usually is less than a month. With all the short-term turbulences that we see, given particularly through the tariff impacts, it's very hard for us to predict any quarter three right now. In that sense, probably not a satisfactory answer for you, but there are elements which are growing nicely, and we're doing as much as possible to focus on that. Yet if the EU, and particularly Germany, France, and UK will see further signs of weakening, then of course it will impact also the overall economic development. For the U.S., again, not easy to say. We expect the agricultural business probably to improve again from the beginning of next year. We don't see any signs yet so far. On the EV side in the U.S. as well, we don't see any major signs of recovery so far. Yet we're winning new business after all, but again, we don't know how the U.S. economy is going to play out. Maybe not a satisfactory answer, but maybe an honest answer that we simply don't really know what's going to happen in Q3. Okay, thank you. My second question has to do with the U.S. business. I'm sorry if I've missed all the details, but maybe if you could, I've made the following comment. Your direct impact is $50 million of costs, and you have a, let's say, cost effect from the tariffs of $35 million. You want to pass it on, and the potential benefit from you kicks in as of September. Are these the right, let's say, notes that I made? More or less, yes, absolutely. I mean, we import goods for about $50 million. On those, we pay 50% tax, plus we have the depreciation of the dollar, plus we have some other taxes that we have to continuously pass on. That's pretty much correct. The impact will probably happen in Q4, something like that, with the price increases. We're trying as much as possible to pass on those price increases. That's correct. Okay. Two more questions for me. First of all, Ferdinand Gross GmbH in Germany, you made some comments, some interesting comments about it. I'm just wondering, I mean, this is a brand new company for you. How smooth is the integration? Do we need to do some sort of adaption or any integration action on the IT side or anything really that we can expect for the near term? Near term, we're not going to integrate the systems because Ferdinand Gross is running smoothly, well, and efficiently. They're also good at winning new projects. We are not going to touch Ferdinand Gross from a systems perspective and from an infrastructure perspective. Of course, we're using synergies on the procurement side. We have a program to use those synergies as much as possible and as efficiently as possible by working together on the procurement side, obviously, but also on the sales side to look at the common customers and to enhance each other whenever we can. We will not introduce our ERP system in Ferdinand Gross in the near future. I see you right. Thank you. The last one for me. I mean, Asia has been the only region which showed some growth very recently. I was just wondering, I mean, how much more organic growth can you achieve in Asia overall before you need to, let's say, acquire new sites or companies? I think it stands and falls with China. India is growing nicely. Malaysia is growing nicely, double digit. If China comes back, and could be, we don't know, this could add another couple of percent of organic growth. Growing through acquisitions in Asia so far hasn't been so easy because we haven't found the partners, the quality partners that we have been looking for. Traditionally, we have been growing mostly organically in Asia. I guess there is some more potential with China. Of course, if you want to make the huge jumps, you would have to look into acquisitions. Again, it's not easy, and it's not so simple to find the right partners. Merry career. Thank you very much. That's it for me. Thank you. Thank you. The next question comes from Sebastian Vogel from UBS. Please go ahead. Good afternoon. I have three questions. I would ask them one by one. First question is, since you have shown on this one slide the PMI reference, in that regard, the PMIs for Europe, they have improved over the last couple of months, while your growth in Europe was rather going down if I compare H1, sorry, Q2 to Q1 in that regard. How you would explain the mismatch there? Can you say again? Sorry, I'm not sure if I understood acoustically. Sorry. Yeah, the PMIs in Europe have improved over the first six months for this year. Of course, on a low level, but nonetheless. At the same time, your growth rates in Europe were going down, right? That Q2 growth rate in organic terms was below the Q1 organic sales growth rate. I was just wondering how you would explain the mismatch there. I can only explain to lead times, to time lags we see here because the PMI clearly indicates three- six months lead indicators. In that sense, that's probably the explanation. In general, the PMI is, of course, an underlying important factor for our business. That's how I would explain it. Got it. Coming back to the point on the tariffs in the U.S., what you meant before. If you try to bring it down on the pricing side, would it mean that for your U.S. business on aggregate, you will then increase prices by around 5%- 10% or something like that? Would it be a way higher number? Can you give us a little bit of a ballpark how we should think about the price increase angle on a U.S. aggregate basis? Yes. It's somewhere between 10%- 30%. I would say somewhere in the middle, probably, as an aggregated number. It depends a lot whether, of course, customers use imported parts or not. Also, actually, for locally sourced parts, prices will go up because the local manufacturers have to import aluminum and steel as well from abroad. They pay again those 15% on the raw materials, and their final products will also go up by 5%, 10%, or whatever percent. The inflation will come for sure, and whatever we will face and have to pay, we will pass on to customers. I would say somewhere around those 15% I would expect. Got it. Here's a last question on my side. If I look at the organic sales growth rates in May and June, and if I compare those numbers with the average for the second quarter, was it in any way different in any region, or was actually the quarter average, so to say, for the different regions quite reflective of what was seen also by the end of the quarter? Yeah, it was quite reflective. I would say Asia is still growing pretty strong, maybe accelerating a bit. Europe rather going slightly weaker, not much, but slightly weaker. The U.S. is still down, as we have seen in the first quarter. Got it. Many thanks. Happy to go back to you then. Thank you. As a reminder, if you wish to register for questions, please press star followed by one on your telephone. There are no more questions at this time. I would now like to turn the conference back over to Dr. Daniel Bossard for any closing remarks. Yes, thank you very much, and thanks a lot for attending our semi-annual webcast for 2025. Whenever there are questions left, please don't hesitate to contact us. We're happy to provide you information. With that, I'd like to wish you a nice afternoon or evening and look forward to talking to you next time. Thank you very much.