Good day, thank you for standing by. Welcome to the GEA Group AG Pre-close call Q2 2026. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Oliver Luckenbach. Please go ahead. Thank you very much, Mel, good afternoon, ladies and gentlemen. Welcome to our Q2 2026 pre-close call. My name is Oliver Luckenbach. I'm the Head of Investor Relations at GEA, and my colleagues Rebecca and Eduard join me for today's call. As today's call will contain forward-looking statements, it will be conducted according to our disclaimer. I will not read the disclaimer, but please be aware of the cautionary language that is included in our safe harbor statement, which is part of our presentations you can find on the internet. We will now address topics which we also discussed during recent conferences and roadshows. Afterwards, you will have time to ask questions. Topic number one, guidance. We confirmed our group guidance for fiscal year 2026, which we released with our full year 2025 results in March. We expect organic sales growth between 5% and 7%, EBITDA margin before restructuring expenses 16.6%-17.2%, and the return on capital employed between 34% and 38%. No changes. Topic number two, customer industries. Food. The business is looking good. It's a broad customer industry with some smaller applications like poultry showing strength. On the beverage side, the picture is improving in both components and projects. Alcoholic beer is structurally softer, but we see a good momentum in non-alcoholic beer. Dairy processing. The pipeline continues to show activity across both projects and components. We see ongoing good market development with a big trend currently in protein-rich products. Dairy farming. The general market sentiment is okay, with U.S. and large farms being the growth drivers. Pharma has been a growth contributor in the first quarter. The business continues to look good depending on the application. On the new food side, we are optimistic that the positive development continues. We can make further progress later this year. Topic number three, order intake. We are very confident that 2026 will be again a good year for GEA in terms of order intake. The pipeline looks very promising across the board, in terms of large, medium-size, and base orders. This supports our confidence of a solid order intake in full year 2026. We had a good start into the year with an organic order intake growth of 6.4% in the first quarter. We see no reason why this trend should not have held up in the second quarter. Regarding the second quarter, in addition to a healthy development in small and mid-sized orders, we have booked two large orders with a combined volume in the mid-double-digit million euro. On the translational FX side, you should expect a smaller impact compared to what we have seen in the first quarter. Here it was -3.4%, for the second quarter, we only expect a slightly negative effect. Topic number four, sales. We started the year with an organic sales growth of 5.3% in the first quarter, and we do expect an acceleration during the year. As with order intake, translational FX effect should have become smaller. Best guess is also here that remains slightly negative in the second quarter. Also here in the first quarter, as a comparison, it was -3.7%. Topic number five, EBITDA margin before restructuring expenses. Our EBITDA margin guidance clearly indicates that we want to make further progress with regards to our profitability in full year 2026. After an already good start with a margin of 16.2% in Q1, we expect further progress in the second quarter. Just to remind you, last year in the second quarter, in the second quarter 2025, we had an EBITDA margin of 16.5%. That's it for my side, and I will now pass over to Rebecca. Thanks, Oliver, and hello, everybody. What to keep in mind for cash flow. That's topic number six. Just as a reminder, we expect CapEx of around EUR 240 million for the full year 2026, and in Q1, we had EUR 33 million. With regards to net working capital to sales, our target corridor is 7%-9%, and Q2 will most likely be within this corridor. As a reminder, Q1 2026 was 7%. Don't forget our dividend payment, which we had at the beginning of May, where we paid out our annual dividend of EUR 1.30 per share. The entire cash outflow for the dividend is around EUR 212 million. Number seven, some housekeeping information. Depreciation and amortization before restructuring expenses, we expect for the full year around EUR 230 million. In Q1, we had EUR 53.5 million. With regards to our financial results, we expect for the full year around EUR -30 million, and we had in Q1, EUR -6 million. The tax rate is expected for the full year between 28% and 30%, and we had in Q1, 29%. R&D for the full year, we expect around 3% of sales as R&D expenses. In Q1, we had 2.4%. Now we are happy to take any questions you might still have, and I hand back for that to Mel. Thank you. As a reminder, to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We'll now go to our first question. Our first question comes from the line of Klas Bergelind from Citi. Please go ahead. Your line is open. Thank you. Hi, Oliver and Rebecca. Klas here from Citi. My first one is on FarmTech. I think you said dairy farming is okay, and you mentioned the U.S., and then Oliver, I think you mentioned larger farms. What's going on in Europe at the moment? Obviously, feed costs are going up, meat-to-feed ratio is coming down a bit here. Is Europe still holding in or any changes there? That's my first one. Thank you. Let me maybe start. Thanks for your question, Klas. Yes, you're right. We have mentioned this. However, what we are still seeing is that also overall, the dairy farming business, let's say overall, it's nothing where we are, let's say, having a lot of headaches about. There are always some dependencies on food, milk price, milk to feed price ratio here and there, but nothing that is really right now a concern for us. Overall, what we said, it's a very healthy and also sound business we are seeing here. Obviously, you're coming up against a quite tough comp here in FarmTech. I heard what you said, that's sort of the group order level, do you still think FarmTech can grow in the second quarter? Yeah. At the end of the day, what I said, we are quite positive. There's no reason to assume that there's a, let's say, trend that has completely changed to what we have seen so far. Okay. My second one is on, obviously, you're still talking about the pipeline looks good, large, medium base orders, very confident, and this is sort of mirroring the comments from management during recent investor conferences. If you look at nutrition, and I'm thinking the order pipeline here, obviously, going into the fourth quarter, looking a little bit further ahead, we're up against a very tough compare, thinking about the Baladna order. Do you have those sort of food security, very large orders that are in the pipeline, like that kind of size that you think that you can realize later in the year? Yeah. As I've mentioned at the beginning, we are actually quite optimistic looking into our pipeline, let's say, across the board. In particular, also with you, what we are currently seeing and discussing in terms of large orders, that we're actually quite positive that also 2026, that should be a year with further growth in order intake. For sure, Q4 as a single quarter last year was a very strong quarter with order intake of more than EUR 1.8 billion. This will be hard, let's say, to top. You know it's always hard to predict finally when we will be able to book the orders. As I've mentioned, very good pipeline. We have already booked two orders in the second quarter. There's most likely more to come in the third quarter and probably also in the fourth quarter. Overall, Q4, it's a very high comp. On a yearly basis, I see no reason why we shouldn't be able to grow our order intake year-over-year. Yeah. Final point here, you did EUR 73 million in the first quarter. Now you talk about a mid-double-digit large order in the second quarter. Larger orders need to ramp a lot here in the second half. You seem very confident that you will land a lot then. Yes. That's good to know. Very confident on this. Yeah. Absolute final one is just a clarification. What did you say on sales growth? I got interrupted a little bit here when you talked about that for the second quarter. Sure. Yes. We said that after the start with an already good growth of 5.3%, which is already at the lower end, let's say, of our full year guidance of 5%-7%. We expect that we expect an acceleration during the year. We see no reason why this shouldn't be also the case then for the second quarter, because we want to get to this range of 5%-7%, or let's say, more in the middle to the higher end of this range. From that perspective, also quite confident what we have seen so far with regards to good order intake growth. Sorry, good sales growth. Perfect. Yeah. Thank you. You're welcome. Thank you. Once again, to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We'll now move on to our next question, and our next question comes from the line of Sven Weier from UBS. Please go ahead. Your line is open. Yeah. Thanks for taking my questions. Good afternoon. Thanks for doing the call. Oliver, you talked about beverage. That caught my interest because that's been quite a difficult market for quite some time, and now you start to talk about an improvement here. Can you elaborate a little bit further of what you're seeing there and what's? When you said the non-alcoholic part is driving it, can you go into some more detail about that? Yeah, I think also if you look into the newspaper, you can really read that at least in some regions, in particular in Germany, there is a certain kind of, let's say, lower demand for alcoholic beer, but on the other side, more demand for 0.0% alcohol beer, so alcohol-free beer. That is also a trend that, let's say, we have observed, and that's also something we are discussing with our customers for sure. Yeah. Maybe just one thing to add here, Sven. If you look at our Q1 results, we highlighted already for the division Pure Flow Processing in terms of the order intake growth in the first quarter, that the growth was also driven by the customer industry beverage. There are various customer industries, but beverage was one of the growth drivers in Q1 in Pure Flow Processing. Is the majority of your revenues in beverages from beer in general, or also non-alcoholic beverages? Alcoholic beer, alcoholic beverages make only a small amount for us in beverage. If you can think about it this way, like carbonated drinks, all that stuff, or juices, it's also beverage for us. Innocent is a well-known customer, so this also plays a role in there. Okay, thank you. Second point I had was just on capital allocation. Obviously, share has been a bit of a roller coaster during Q2. I was just wondering what management has said during conferences roundabout capital allocation. We obviously saw them buying shares quite a bit on a management level. Yeah, also the pecking order maybe between M&A and buying back shares. Yeah. Thank you, Sven, for this follow-up question. Regarding uses of cash, we have this clear, let's say, have divided it here into the four buckets. We said that CapEx is the first one, but you also know that over time, we also want to reduce CapEx as a percentage of sales from currently still more than 4% down to 2.5%-3%. We have also, I would say, very interesting and attractive dividend policy. We want to distribute around about 50% of our net profit to our shareholders as a dividend. Due to the fact that we are expecting rising earnings also going forward, this is also an attractive element of our stock. M&A is but I think it also tells a story that we haven't done anything because it also means that we are quite strict regarding our criteria. We look at our own multiple compared to the multiples of potential transactions and would only, let's say, do an M&A deal, an acquisition, if we are really convinced that it would also be attractive for our shareholders. Last but not least, for sure, we are a cash-rich company. We have a strong balance sheet, that's also something. Share buyback, we are looking into from time to time. From that perspective, that is what we are telling here. Yeah, some of our Board members, as you have said, they have used the opportunity because we also had no real, let's say, explanation for the, let's say, not so positive share price development after the release of our Q1 numbers. They have used the opportunity to buy some shares. That's correct, yeah. Is it fair to say that the lower the share price, the higher the pecking order maybe for buybacks then? It could change the pecking order a bit? Yeah. It's always hard to say. There are many things you need to consider, as you know. I've just described them. You also know that also in the past, we have not only talked about share buybacks, we also did them if we thought it would be the right timing. As I said, this is a topic that is always on a regular basis, also discussed on a board level. Yeah, that is the normal rule, let's say, we are following. As you know, in the past, in the meantime, we bought back more than EUR 700 million of our shares. It's also one of the means, one of the potential uses of cash for GEA. Yeah. Understood. Thank you. Thanks again. You're welcome. Thank you. We'll now move on to our next question. Our next question comes from the line of Meihan Yang from Goldman Sachs. Please go ahead. Your line is open. Hi, this is Meihan from Goldman Sachs. Thank you for taking my question. Just have one question on the margin side. Historically, if we see the historical seasonality, 2Q tend to be quite strong. Taking into the fact that you said at 1 Q call that in the first half is probably more of the delivery of the new equipment sales that you take order in full quarter last year, should we expect less strong seasonality pickup from Q- on- Q margin-wise? Thank you. I've mentioned the margin of the second quarter of last year, so Q2 2025, that was 16.5%. In the first quarter, we have achieved an improvement of around 40 basis points compared to the first quarter the year before. Overall, we want to improve our margin. It is correct that it's normally a little bit more weighted towards the second half of the year, but at least it's our, let's say, our intention is to show some kind of improvements always quarter also over quarter. From that perspective or from what I said, I think one can assume that you can also expect some margin improvement in Q2 this year over the second quarter of last year. Got it. Thank you. You're welcome. Thank you. We'll now move on to our next question. Our next question comes from the line of Adrian Pehl from ODDO BHF SE. Please go ahead. Your line is open. Yes. Thank you. Hi, everyone. Just a quick question actually on free cash flow. Thanks for the additional financial information you've been giving usually. I was just wondering if we should, besides what you said, take something into account, in particular on free cash flow, or does it follow the normal seasonal pattern, i.e., I guess should be improving over Q1? The second question very quickly, could you help us a bit with the restructuring amount that is due to hit the P&L in Q2? The last one is actually on NPE, as obviously, this one was a bit slower, I guess, than generally expected in Q1. Should we take into account that conversion from the backlog is improving already in Q2, expecting a better quarter from a top-line perspective? Yeah. Let me maybe start also with your last one on NPE. As you said, the starting to one was okay-ish, I would say. I think there's room for improvement. As we said, you can expect that there will be further, let's say, conversion of order backlog into sales already also starting with the second quarter and then also going forward in Q3 and Q4. On the cash side, maybe I would say that overall for the full year, we are quite optimistic that we will come out with a similar free cash flow like last year, so around about EUR 500 million. That has also to do with large orders where we get a lot of prepayments. We have talked about the pipeline, which is very promising also for the second half of this year. From that perspective, I think we can also be quite positive here. On the restructuring side, we are currently guiding for a level, let's say around about what we have seen last year. It's hard to say what exactly will be booked or has been booked in the second quarter. That's maybe something we can share on August 10th. Very quick one, half for understanding and half to dig deeper into it. You did say you booked larger orders with a double-digit million euro amount. That's specifically referring to the very large orders above EUR 15 million, right? Correct. Correct. Okay. It's probably- Yeah. ...I don't know, three, maximum four that you probably booked, I guess. No, sorry. I said we booked two large orders- Okay. ...with a combined volume in the mid double-digit million euro. This part I didn't get. All right. Okay. Thank you. You're welcome. Thank you. We'll now move on to our next question. Our next question comes from the line of Akash Gupta from JPMorgan. Please go ahead. Your line is open. Yeah. Hi, good afternoon, Oliver. Thanks for your time. Most of my question has been asked, just one follow-up, and that is on the order intake this year. I think, you have been guiding for order intake growing over last year. Last year, we had one very large order from Baladna. Of course, when you have a single order of that size, it can create a meaningful difference to a quarterly order intake. Therefore, my question is that when we look at the pipeline, I think you mentioned you have very strong pipeline for small, medium, and large projects. Can you say, do we have any project in pipeline of this Baladna order that you booked last year that can create big difference to a quarter? These large orders are more like, let's say, double-digit, high double-digit type of range, and therefore, we shouldn't be expecting that much volatility in quarterly orders. Thank you. Yeah. Thank you very much for your question, Akash. It's not that easy to answer. For sure, there are many, many different orders we are discussing with our customers and all across the board. Some also in the magnitude of, in the low triple digits. As you know, it's always hard breadth of our, let's say customer. You know this chart we like to show all the time is that we have so many [audio distortion] let's say, the confidence to make this kind of statement. Regardless if at the end of the year there will be an order in our books similar to the size we have seen, with regards to Baladna or maybe a little bit smaller. Overall, we see a very good and strong pipeline. Yeah. Thank you, Oliver. I think your line was breaking in between, I can follow up afterwards. No, probably not. We should, because then. Also quite strict in this, can you hear me now? I'm happy to repeat what I said. Maybe, Rebecca, you can mh- What Oliver was referring to, Akash, is actually the slide in our presentation where we're always sharing that the single largest customer is just about 2% of our sales. The actually top 10 customers to just account for really small percentage of our overall sales. Just highlighting how, let's say, independent we are from a single customer and therefore actually have this quite promising pipeline in different projects, across different regions and customers and customer industries. Thank you. Maybe if I can clarify, when we look at your pipeline, it's not like. If we have to look at the risk to your order intake guidance, then it's not like we are just looking for one or two large or very large projects that can make or break when it comes to. You have very diversified pipeline. Yeah. Exactly. Correct. Yeah. Yeah. That's not the case. Yeah. That is very clear. Thank you very much. You're welcome. We'll now move on to our next question. Our next question comes from the line of Uma Samlin from Bank of America. Please go ahead. Your line is open. Hi. Good afternoon, Oliver and Rebecca. Thank you for taking my question. I just have a follow-up on revenue conversion on NPE. I guess, last quarter. You mentioned today, well, the conversion was poor because of project phasing. Would we then expect Q2 to see already a normalized phasing in terms of both revenue and margins? Yes, maybe I just take that. In terms of the organic sales growth in the first quarter in Nutrition Plant Engineering, you're right, they started the year with -4.8%. What we already stated at that point of time, that we expect an acceleration in terms of sales conversion. Actually converting the order backlog into sales, also already starting with the second quarter. You know that we also kept the guidance for this division for the entire year. The guidance for Nutrition Plant Engineering in terms of organic sales growth is for the entire year, 7%-9%. If you start the year with -4.8%, you can assume what kind of acceleration needs to come. That's very clear. Thank you very much. I guess just a follow-up, given I couldn't hear you very well in the last answer on the order intake side. If I just ask a slightly different way. If we include the large order that you took last year, I guess because you don't have a single largest customer, so I guess that should not affect that you had a very large order last year with Baladna, should not affect your thinking on organic growth, I guess. No. So- Yeah. Your organic growth should continue to ramp up as you guide it, mid-single digits despite the large orders we saw last year. Is that a correct interpretation? With regards to order intake, I said that we are quite confident that we will grow our order intake versus 2025. Knowing that there was this very large order of Baladna. We haven't given any numbers here. In terms of sales growth, for this year, we are guiding organic sales growth of 5%-7%, and in general, more than 5% over the period 2024- 2030. That is what I can also confirm today. Yeah. Yeah. That's very clear. Thank you very much. Thank you. We'll now move on to our next question. We have a follow-up question from the line of Adrian Pehl from ODDO BHF SE. Please go ahead. Your line is open. Yeah, thanks for having me again. Actually, two very quick ones. One on the Middle East side of things, just want to make sure that there were no issues on the supply chain or any kind of impediments to the ability to ship in that country. Wording has not changed, I would assume. Secondly, on tariffs, I guess you are also queuing up in the line to get some refunds. I just wanted to hear a bit of an update on that situation and how it has progressed. Thank you. Yeah, I can start with. Yeah, please go ahead. Yeah. Yeah, I can start with the cost inflation side. As you rightly assumed, Adrian, there are no news in that regard. The wording has not changed. What we have seen that logistic providers were increasing their prices for transportation. As we shared with you, we charge transportation costs directly to the customer, we don't see an impact here for ourselves. Regarding, let's say, in general, let's say price inflation for energy-intensive raw materials, we do expect inflation coming in here or kicking in here, we are in active dialogue with our suppliers to negotiate against these price increase requests and counteracting these effects with targeted measures and where necessary, also with price increases. Keep in mind that we also have in the project business locked-in prices and on top price escalation clauses. No change in wording, just summarizing again what we told you so far. Regarding the refund, to be honest, Adrian, I have no new news here. Haven't heard anything so far, if you already got something back or not. Maybe that's something we can then also discuss on August 10th when we release our Q2 numbers. Yeah. Perfect. Thank you. You're welcome. There are no further questions at this time. I'll hand the call back to Oliver for closing remarks. I think there's one final question coming in just now. Thank you. Our next question comes from the line of Klas Bergelind from Citi. Please go ahead. Your line is open. Thank you. Sorry, I just want to clarify one thing there, Oliver. You said that obviously you talked about margin progression, further margin progression. To your knowledge, there is nothing that is boosting the margin or like, yeah, profits. Maybe this is margin neutral, actually, but there's nothing that is boosting profits from the tariff refunds? No. Yeah, it would be great to get some clarity when you report. Yeah EBITDA had something of that in it later. Yeah. Thank you. Sure. No, we will update you clearly. Thank you. No funding so far to be expected in Q2. Thank you. There are no further questions at this time, I'll hand the call back to Oliver for closing remarks. Yeah. Thanks again, Mel, the analysts and investors from participating. I think as you have heard, we are and remain very positive for our Q2 and also full year 2026 performance. With the end of this call, we will start our quiet period and are already very much looking forward to talking to you again on August 10th of the release of our Q2 2026 numbers. All the best from the entire investment team of GEA, talk to you soon in August. Bye-bye. This concludes today's conference call. Thank you for participating. You may now disconnect.