At this time, it's my pleasure to hand over to Veronika Endres, Head of Investor Relations. Please go ahead. Good afternoon, everybody, and welcome to HENSOLDT's H1 2024 results call, which we are holding at our ESG site in Fürstenfeldbruck today. Thank you for joining us. I'm Veronika Endres, Head of Investor Relations at HENSOLDT, and with me are our CEO, Oliver Dörre, and our CFO, Christian Ladurner. Oliver and Christian will guide you through this presentation today, which will be followed by a Q&A session. And with that, I hand over to you, Oliver. Thank you very much, Veronika, and a cordial welcome from my side as well. I'm very excited to lead you into today's presentation after having passed the 100-day mark as CEO and the 200-day mark as a HENSOLDTIAN two weeks ago. When I briefly summarize the first half year at HENSOLDT, I can say with conviction that this company excels in many areas. My three key observations are, firstly, our technology is really impressive. For example, we receive high praise from the air defenders in Ukraine, where our TRML-4D shows outstanding detection, performance, and high reliability. Secondly, the entire HENSOLDT team is extremely motivated and determined to provide our customers with much needed capabilities. And thirdly, we enjoy a very solid support by our anchor shareholder, the German government, and our stakeholders in the political domain. To drive our company from great to excellent, I have already outlined my three focus areas for the medium term: operational excellence, digitalization, and internationalization in our 3M call. We have defined clear and tangible action plans, which we are now implementing with rigor. So let me outline a few of the measures we are putting in place. In operational excellence, we are focusing on delivery capability in both quantity and quality. We are taking care of the expansion and stabilization of the supply chain, initiating a transformation in engineering, and optimizing our approach to bids and project management. Further, synchronization of the ongoing transformational programs is another focus. We are also assessing our international presence with the intent to better align market potential and resource investment. Our clear goal is to do around 50% of our business in Germany, around 30% in Europe and with NATO partners, and beyond that, 20% in deliberately selected markets. We will also develop a consistent approach when it comes to sensitive countries and a standardized framework for export regulations, keeping the government to government agenda of the German anchor shareholder in mind. We are also developing a conscious focus on establishing our industrial presence internationally. A first step is an improved governance to better integrate our national entities, South Africa, France, and the U.K. And last, but certainly not least, we will make sure that our portfolio will become smarter, more digital, and software-enabled. Connectivity, system of system architectures, networking, and AI are elements that will support the transformation of HENSOLDT from a hardware-based to a software-defined provider of integrated sensor solutions. All these measures serve as a means to an end, and I will outline our path towards the HENSOLDT 2.0 at the end of today's presentation. It was very rewarding experience for me to meet some of you, our investors, at our U.S. and Canada roadshow in June. The most frequently asked question at all meetings addressed in defense is the defense spending in Germany. So let me give you some color on this topic. The special fund introduced in 2022 mainly served as startup financing for several important and strategic defense procurement projects. This trend now stabilizes and is reflected in the midterm budget planning of the German government. With a mix of budget increases, finance authorizations, and the special fund, the German government has sent a clear signal for its commitment to spend 2% GDP for defense, reaching approximately EUR 80 billion in 2028. And this commitment is underpinned by very concrete procurement plans. For example, the order of 20 additional Eurofighters that Chancellor Scholz announced at the Berlin Air Show, or two additional F-126 frigates that have recently approved by the parliament, as well as 105 additional Leopard tanks, also already approved by the parliament. I mentioned this in our 3M analyst call, and I can only repeat, defense procurement in Germany is no longer a question of if, but how. Naturally, breaking up the long-established mechanics of the cameralistic system takes some time, and yet, I am confident that we see a continuation of the current dynamics in German defense procurement. Let us not forget that the European market remains favorable as well. Clear shifts against Europe, European NATO members, plus Austria and Switzerland, will spend an additional EUR 700 billion-EUR 800 billion on defense by 2028, and 23 of the 32 NATO nations have reached the 2% GDP defense spend target this year. The alliance reconfirmed its commitment to Ukraine and its recent summit in Washington, authorizing a EUR 40 billion support package and pledging strongly for enhanced air defense capabilities in Ukraine. Let me now have a look at some business highlights. Order remained strong in the second quarter, driving our total order intake for the half year 2024 to more than EUR 1.3 billion, and our order backlog to almost EUR 6.6 billion. We reinforced our excellent position, both in the ground-based and naval radar segment, with orders for further TRML-4Ds within the ESSI initiative, SPEXER radar for Skyranger 30, self-propelled anti-aircraft gun, and the additional two F126 frigates for the German Navy. ESG also contributed to our strong Q2 order intake, with a contract for A400M material management worth EUR 45 million. In the second half of this year, we expect further dynamics in the armored vehicle segment, benefiting our optronics division. Our German customer is preparing to order Boxer infantry fighting vehicles that will be equipped with a Puma turret, featuring HENSOLDT optronics and self-protection, as well as also the already mentioned 105 additional Leopard 2 tanks. Of course, also featuring HENSOLDT's digital optronics. The Eurofighter business once again proves to be a solid contributor to our order intake, with another capability enhancement of the Mark I contract worth almost EUR 300 million. ESG has very recently signed the already eighth installment of its contract to operate the central German Armed Forces spare parts logistics, at least at 2028, called ZEBEL. Talking about ESG, let's have a look at the status of the post-merger integration. I can make this quite short. The PMI is a resounding success, and I see a lot of potential. We have achieved all day 100 milestones, and will even advance the integration of central functions from end of the year to October first. It is important that our central functions form a strong, supportive backbone for the new divisional setup that we communicated a few days ago. As mentioned, I see a huge potential in the integration of ESG, and I'd like to have a quick look at the unique capabilities of ESG that will contribute strongly to our multi-domain solution offering. ESG supports the German Armed Forces helicopters from introduction into service to phase out, offering full product life cycle support. The portfolio includes the CH-53, NH90, Tiger, Sea Lynx, Sea King, and the future CH-47 Chinook. In 2023, Germany has ordered 60 CH-47F Chinook helicopters, which will form the heavy lift rotorcraft backbone for the Bundeswehr from 2027 onwards. In partnership with Boeing, ESG is in charge for several integration services around these helicopters, guaranteeing their seamless integration into the infrastructure of the German Armed Forces. Let's not forget, this is only the first phase, where a new platform is introduced into service with the Armed Forces. With a lifespan of at least 30 years for a platform like the Chinook or the F-35, system support and service business provide us with enormous potential and high visibility of revenues. The strong partnership of ESG with US primes like Boeing, Lockheed Martin, is a strong asset for ESG and for HENSOLDT, opening new business potential on different platforms. With that, I hand over to Christian to guide us through the financials. Thank you very much, Oliver, and a very warm welcome also from my side. I'm happy to provide you now with our financials for the first six months of 2024. To begin with, I'm pleased with our financial performance. The first half year has been very strong and is totally in line with our expectations. As you know, we have successfully closed the acquisition of ESG, beginning of April, and I'm happy to report that ESG contributed as planned to our group performance. Group order intake developed strongly, with orders summing up to more than EUR 1.3 billion, an increase of 27%. As mentioned by Oliver, main drivers were the NNbS air defense system, TRML-4D and SPEXER radars, and as part of the European Sky Shield initiative, as well as our TRS-4D radars for the F126 frigates. Also, ESG contributed strongly to our order book, for example, with the material management contract for the A400M. Overall, the distribution of incoming orders was again well balanced between our home market, Germany and Europe. Revenue reached EUR 849 million in H1, marking an increase of 17%. This development was driven by sensors, and especially our TRML-4D radar. ESG delivered as planned too, with a contribution of EUR 82 million. The level of pass-through revenue further declined by 26%, resulting in an improved quality of revenue. With a figure close to EUR 6.6 billion, our order backlog again reached a new record level in our history. This continues to provide us with an excellent business visibility. The strong performance of our top line is also reflected in our profitability. Adjusted EBITDA increased to EUR 103 million, leading to an improvement of the adjusted EBITDA margin of 1 percentage point to 12.2%. Our core margin, excluding pass-through revenues, further improved to 13.2%. The increase was driven by the accelerated production of radar business, leading to further economies of scale. This was partly offset by investments in our growth and into our product portfolio of the Optronics business. Adjusted EBIT also benefited from the increased volume and set up to EUR 52 million, with an adjusted EBIT margin of 6.1%, respectively 6.6%, excluding pass-through business. This increase was partly offset by amortization of capitalized R&D expenses. Cash generation in the first half of 2024 was fully in line with our plan and following our usual seasonal profile, with an adjusted free cash flow of -EUR 145 million. Despite the growing business volume, we were able to realize a year-on-year improvement. And as already teased in our last analyst call, we have received first prepayments of our German customer in April, and we expect more to come. To sum it up, our bottom line further increased and developed as planned. Let's now have a look at our segments. In the sensor segment, the strong momentum in order intake continued in the second quarter, with orders summing up to nearly EUR 1.3 billion, exceeding the previous year's figures by 53%. Organically, the year-on-year increase amounted to 33%, driven by TRML-4D and SPEXER radars within ESSI, as well as our TRS-4D for F126 radars. As previously mentioned, the contribution from ESG was strong as well, with EUR 166 million, which corresponds to a book-to-bill of 2x for ESG. Revenue in the sensor segment increased significantly by 23% to EUR 745 million. Again, I want to highlight that due to the declining share of pass-through revenue, core revenue increased even stronger by 16%. Key growth drivers were the accelerating dynamics in air defense and our strong baseline business. Revenue of ESG developed as planned and contributed EUR 82 million to group sales. The margin performance of the sensor segment was again excellent, with an increase in adjusted EBITDA of 36% to EUR 117 million. The uplift in absolute margin of 150 basis points was driven by further economies of scale in our radar business, in particular for TRML-4D, and the decline of pass-through revenue. In the Optronics segment, order intake developed in line with our expectations and amounted to EUR 139 million. As a reminder, previously including major contracts for armored vehicles, as well as for periscopes and optical mast systems for the Norwegian Ula-class submarines. In terms of order intake, we expect to book several key orders for the Leopard and Boxer, Skyranger 30 in the second half of the year, as outlined by Oliver. Sales came at EUR 108 million. Main revenue drivers were ground-based systems, business, and high-precision optics, FSM in Germany. This was offset by the South African entity, where we are currently conducting a technology change and a realignment of its market strategy. Adjusted EBITDA Optronics summed up to -EUR 15 million. This development was driven by lower volumes in the South African entity. Let us be clear, we are not yet there where we wanted to be. We have a strong backlog, and further orders are expected to come. Nevertheless, in terms of execution, we have to improve, and therefore we have full management attention on that. First, we are running a monthly steerco with the Optronics leadership team to monitor the progress closely. Second, we are in close communication with our OEMs and the end customer to align on development and production plans. And third, we lay the foundations with our investments in the digitalization of the products, as well as internal digital logistics and sites for further ramp-up. We now see first movements in the right direction, and I will give you some color on this, now backed with concrete facts and figures. We are building the basis for transforming the record order backlog of EUR 900 million into sustainable growth. The production plans are set up, approved, and closely monitored. On this slide, you can see the planned increase in production units in our ground-based systems business in Germany for this year, and these are only three examples of many. As mentioned, the business is already growing year-on-year per H1. However, the seasonal profile is rather weak the second half of the year, where we'll see accelerating growth of the German business. For the full year, we expect a double-digit production increase of our land vehicle side, as well as for the M1 Abrams laser range finder. As you can see in the middle chart, we will also produce and deliver the first batch of our see-through armor system to our launching customer, KNDS, for the remote-controlled howitzer. With the initial integration, we are equipping our first customer with this revolutionary sensor solution, which provides a 360-degree central awareness picture for every crew member inside the vehicle. My key message on this slide is, our existing order book, paired with the current ramp-up of our production capacity in Germany, give us visibility and thus a high competence in the business development. And on top of that, the move to the new Optronics site in Oberkochen early next year will further support and accelerate the growth from 2025 onwards. Let's now have a brief look at our net debt development. Reflecting the partial funding of the ESG acquisition by new debt of EUR 450 million, net leverage increased to 2.8x in H1 2024, as expected. Excluding the new debt for the acquisition, net leverage will be at 1.5x. This shows that we are operationally on track, and that we will further the leverage to around about 2x by year-end 2024, as outlined in our guidance. Let me now come to our guidance for 2024, including the contribution of ESG, as introduced in April. First and foremost, we are fully on track to meet our targets, and therefore confirm our guidance for this year, as well as our guidance for the midterm for all KPIs. For 2024, we expect a book-to-bill between 1.1 and 1.2. Revenue to grow around EUR 2.3 billion, and please be reminded that the continued stronger growth in core revenue and a smaller share in pass-through sales than in years before. Adjusted EBITDA margin before pass-through between 18%-19%. And let me be more specific in this regard, we expect the margin to be at the mid- to upper-end of the guidance range. For adjusted free cash flow, we see a cash conversion of around 50%, net leverage at a level of 2x, and dividend payout ratio between 30%-40% of adjusted net income. Coming to a conclusion, let me mention the following key financial takeaways: Our impressive order intake of over EUR 1.3 billion leads an order backlog at an all-time record level of EUR 6.6 billion. This provides us with an excellent revenue visibility for the years to come. Our efficient project execution supports our excellent profitability. We have received first prepayments from our German customer in April, and there will be more to come. The integration of ESG is fully on track, and we are very pleased with the contribution to our group performance. Therefore, we confirm our guidance for all our KPIs, as explained, with adjusted EBITDA margin before pass-through, expected to be at the mid to upper end of our guidance range. Our outlook remains promising, and we are strongly positioned for the upcoming growth. We expect further major contracts to be booked in H2 2024, as explained. We have set a strong basis and good visibility in Optronics to execute the order book. And last but not least, all planned synergies for 2024 with ESG has been confirmed. This and the large scale increase of defense budgets globally, will generate long-term sustainable growth for HENSOLDT. Thank you very much, and I will now hand back to Oliver to give an update how we'll move forward to HENSOLDT 2.0. Thanks, Christian. Dear audience, I mentioned in my introduction that my three midterm priorities are first stepping stones in a comprehensive, strategic, and organizational transformation that will safeguard and prepare our future towards the HENSOLDT 2.0. The midterm priorities lay the foundation for us to deliver capabilities at our customers fast and at scale, and develop modular, cost-effective products, and more integrated and software-defined solutions. Together with our leadership team, we decided to use the addition of ESG to the HENSOLDT family as an opportunity to also evolve our divisional setup. In the future, we will have four divisions focused on our different types of businesses: radar, optronics, multi-domain solutions, and services and training. Our core product divisions, radar and optronics, will bundle our entire product business, including electromagnetic warfare, and continue to focus on developing innovative defense electronic products, and drive synergies through optimized cross-project operations.... The services and training division will mainly maintain its current structure for stability and growth beyond maintenance, repair, and overhaul. For example, including training and simulation, as well as new service business models. We will create a new division to scale solution capabilities as the growth engine, the new growth engine for our company. This clearly signals to our customers the required separation of our product and the manufacturer and platform-independent solution business. This multi-domain solutions division will be a docking point for our customers who think across domains, and we will combine the strength of our spectrum dominance and airborne solutions with ESG. All in all, the changes and challenges in our business environment are nothing but fundamental, and we have launched a project under the name of North Star, to develop a vision for HENSOLDT beyond 2030, to support our next strategy cycle. As the name suggests, North Star will guide us in an increasingly volatile market environment, and will prepare us for the next steps in European consolidation that we will continue to actively drive from a position of strength. Dear ladies and gentlemen, our customers expect us to remain a reliable partner, delivering much needed capabilities. Our political stakeholders expect us to become an even stronger player in the dynamic European defense and security landscape, and the capital market expects us to continue and even accelerate our growth. I am confident that the steps I have outlined today will serve as a transformational roadmap for HENSOLDT, from which we will all emerge even stronger, more agile, and better equipped to face these diverse challenges and seize the manifold and huge opportunities ahead. Thank you very much for your attention. We will now gladly take your questions. We now begin the question and answer session. Anyone wish to ask a question may press star and one on their telephone. You will be returned to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Anyone with a question may press star and one at this time. The first question is from Ross Law with Morgan Stanley. Please go ahead. Hi. Afternoon, everyone, and thanks for taking my questions. A couple from me, please. The first, just on the German defense budget assumption and your confidence in that base budget going from around 50 to 80 over the medium term. Then secondly, on orders. You flagged some key orders in the pipeline for the second half, worth almost EUR 700 million. What's the progress on these? And are awards likely to be front- or back-end loaded this year? Then lastly, on optronics, you provided some information about issues in South Africa. Can you just give some more color around what the facility does exactly, and what these issues have been? Thank you. Okay. Thanks, Ross. Of course, glad to answer, so we will share the answers. Let me start with the German defense budget. So as a matter of fact, as I showed on the slide, I think we're pretty confident going forward, because first, we definitely see that until 2027, we're still the extraordinary budget is phasing in, we are on the level of 2% GDP. And coming back to many engagements I have currently with politicians, I'm absolutely confident, as I said before, that it's not about the if, that we will then switch to sustaining these level of EUR 70 million- EUR 80 million over the time. What makes me confident, and I think that is actually what is also resonating with you, is, first of all, we see, and that is given also my long experience in the German market, that is really a paradigm shift. We see that recently, the German parliament has approved new programs, and they're about to run for 100 decisions this year, where we don't see actually the budget lines in the plan, but they are willing to really feed the demand that is clearly articulated from the Minister of Defense on behalf of all the stakeholders of the Bundeswehr. So the clear evidence is the F-126 additional two frigates, which we hadn't planned for this year, but which now came up also with the option, deadlines running out. Second evidence is the Eurofighter, which is not yet in the parliament, but with a clear commitment of Chancellor Scholz at the ILA exhibition, to buy 20 additional one. We have more coming up, as far as the vehicles are concerned. I will come to that, with regards to your questions on the orders. The second topic is that fuels my confidence is that, of course, many of the programs that we address, I mean, talking air defense, talking the vehicles for the German armed forces, are clearly priorities, where I would say the main direction has been set with some of the programs, looking at NNbS in Germany, where we have more batches to come in the next years. So I mean, there, there's no way back on these ones. As a matter of fact, the customer said A, so we will have to say B, C, D, as well. So in that regard, I think the decisions that have been taken, entering prioritize into air defense, into vehicle build-up, with regards to ship submarines, that decisions that were taken in the past are normative, also on the midterm, to walk the talk they are doing. And last is what we should not forget, probably, and I introduced that, our clear ambition of internationalization. So we have concluded phase one of our internationalization midterm priority initiative, entering phase two now, where also we are more systematically with an account management, shifting focus to Europe, also selling B2B, B2C. Secondly, have selected targets in global campaigns, where we look for a strong alignment, looking at Singapore, looking at India, looking at the Middle East, looking at Taiwan, for example, where we can secure from the beginning, in line with G2G agenda, that export issues will not be the case in these ones. So that's my take on the question one. Looking more on the orders. So coming to the land market very clearly, we are in very close discussions with KNDS, and of course, also, Rheinmetall. But I mean, looking at Leopard, looking at Puma, what I've outlined, the infantry fighting vehicles, we definitely see and the 105 Leopards as the first instance. We have the next to come, the Puma, Boxer, where we're pretty advanced, approaching the decision making. We have additional batch of Puma, where we have aligned already the schedule of deliveries. We are aligned on the specifications. We have taken, which of course we see our initial preparations in the team on the operational excellence. And I'm pretty sure that in the second half, and that is the progress, the maturity of the discussions, we will have the orders coming in, and probably with that, also some first cash milestones, advanced payments. And same applies for the sea. We recently heard on the orders, submarines, Minister Pistorius demanding four additional submarines. We have pretty mature discussions now, where we leverage on a good relation of ESG, looking at the F-127, where we expect also decisions this year, early next year, where HENSOLDT, with the support of ESG, could play a major role. And last but not least, also on cyber, a maturing, progressing on our deliveries on the PEGASUS program. We have started also with a backup, and that started at ILA exhibition as well, together with the Chief of the Air Force, looking at G2G agendas, and we have three customers identified, where with one of them, we're already in the RFI stage. So that means also we see that we can multiplicate the PEGASUS on the midterm. Yeah. Last, and least, Ross, thank you for your question. So first, maybe in terms of structure, we have to understand when you take the optronics segment, it's 80% Germany and 20% South Africa. And in South Africa, we currently see two topics. We have a technology change, so the gimbal technology changes in a generation. That means we cannot now do some revenues until the gimbal is fully developed. And the second one, and we've wrote it and commented, we are currently realigning market strategy. That means we are much more thoroughly than the years before, in which countries we export the gimbals, and this is how it behaves in South Africa. Nevertheless, I have to say, when you look at the H1 business and the Optronics German business, and this is a clear driver, and, Oliver was mentioning the orders which are coming in, they relate to Optronics Germany. We see now the first growth, and, going forward, with 80% of German Optronics business, we will, we will see growth in, in from a segment point of view. Thank you very much, both. Very clear. The next question is from Carlos Iranzo with Bank of America. Please go ahead. Hey, guys. Good afternoon, and thanks for taking my questions. I actually have two, if I may. The first one, on cash flow and PDPs. So how should we think about PDPs from Germany in the second half of the year? And then the second one, if you could please remind us the growth outlook for ESG and the midterm margin profile. Thank you. Hello, Carlos. So first of all, cash flow, second half. So you know that in H1, we are at the deepest level of our cash. So we have guided for 50% cash conversion, so this is quite good in line. So and we expect, of course, more advanced payment. They should be in the region of we have seen in H1, so this continues. But with that, of course, we invest further in working capital to prepare now for the orders we have gotten. So the conversion of the profit into the cash is in the range of the guidance, so this is ongoing. ESG, for this year, we see EUR 300 million for nine months, means that with the EUR 82, with also a very strong Q4, we are very, very good in line, and going forward, we see these 10% on ESG, quite similar to our organic business. When then you recalculate, from nine months to 12 months, and plus the 10%, we see next year around EUR 400, which we have guided also for, for next year. So this is on a very good track and well in shape. Okay, thank you. The next question is from Aymeric Poulain with Kepler Cheuvreux. Please go ahead. Yeah, good afternoon. I just wanted to go back on the German budget initial question and your forecast for 2025, which suggests slight increase compared to the EUR 80 billion. And I suppose in early July, there were a series of articles suggesting that the budget could be cut, especially the Ukraine part of it, the EUR 8 billion could be cut by half. Just wanted to have your take on that, and is there some offset that you see that were not necessarily put in the draft budget? And indeed, if the Ukraine help is cut, what would be the consequence for the radar business in particular and the margin outlook? Is there a sensitivity analysis you could give for this type of scenario? That would be the first question. And the second question, I think you gave the sales number for ESG, but you didn't give the EBITDA contribution for the quarter. Would it be possible to have that? And looking at the new structure, the four divisions that you plan to have, when do you think you'll be able to provide a pro forma? And indeed, what benefits should we assume from this new structure? Is it a commercial clarity benefit, or are there some specific costs to add to build this type of new infrastructure? Just clarify the rationale for the new division plan. Thank you. So first question, hello, Aymeric. Firstly, first question on the budget. So we have outlined next year, 2025. We still see the EUR 8 billion for Ukraine military support, and when you look at page four, the EUR 4 billion are then coming from Germany, and the rest of the EUR 4 billion shall be funded by the EU or the G7. There were also some discussions on that, that it will be funded from the frozen funds of Russia. So this, we still see the EUR 8 billion as quite stable, and I do not see now any impact on air defense. This is still vital, and I also expect further batches from Ukraine, in this regard. With that, we are on a good track with the margin. You have seen it now. Last year, we did around 19.9%. We are now one percentage ahead, and this is why we're quite confident that we are at the mid to upper range of the guidance. So this develops further, and we will see how this outlines. So the contribution of ESG for one quarter was EUR 9 million EBITDA, so this was fairly in line with our margin. Normally, you see around 14% EBITDA margin, so this is how you should model the ESG business. And last not least, I think I've understood it right, that you asked if the new divisional structure will have some additional costs, but this is not the case. It's just how we approach the markets and how we organize ourselves internally in order to create value out of the multi-domain solution, what is mainly also customer driven with the new focus, also on these, on these topics. Thank you. The next question is from Sash Tusa with Agency Partners. Please go ahead. Thank you very much indeed. Good afternoon. I've really a follow-up to Aymeric's question, I think. I don't think I quite understand the new divisional structure and specifically the multi-domain part of it. Should we expect a program like Pegasus to be in this, and so separated out from the core radar business? Okay, maybe, this is Oliver speaking again, and, great to have you here, Sash. I will give you a bit more insight on the new divisional setup, and then we'll, Christian will focus a bit more on the reporting segments and all of that. So yes, indeed, as you rightfully say, the multi-domain solutions division, I would say at that stage, and please maybe add an upfront disclaimer, we're in the middle of sorting that out. That is rather giving the guidelines or guardrails for the future setup, and we actually have kicked that off with our senior leadership meeting, which took place one week ago. We're working now with the division heads, as very clearly, this new setup is following three priorities. First thing is looking at our customers.... to be closer linked and looking at B2B, B2C customers to have a clear match. And as I outlined already, that is, of course, also reflecting the request of some of the partners of ESG, also growing in solutions where we have to have a stronger interdependency, a dependency, sorry, between the products and the solution business. So customer is one thing. Second thing is, of course, the business, and that has, again, two elements: business continuity. Of course, we want to sustain the strong business that we have today, but we also want to open the door strategically to develop the business and agilely answer the dynamics that we see on the markets. And last, of course, I mean, looking bottom line, it's also about cost efficiency. And that are the guiding principles, together with this four divisional setup that we have shared with our experts, and we are running that exercise now with the top leadership team in the next week, with the ambition to rather start in that direction in next year. So, coming back to multi-domain solutions, as you rightfully said, there will be, I would say, two sub-pillars in that. One is really looking at the customer, where we want to leverage on the very strong, conceptual, and also system integration-wide capability that we have with ESG in the land, in the air, in the sea, in the cyber, and the space domain. So that is also the divisional, or, in our nomenclature, it will be rather the business unit structure that ESG has today. That is what we want to bring the ESG business units with all their know-how into HENSOLDT. That is what we have in this one pillar, a very customer-oriented structure, where we look at solutions in the domains, and of course, there will be a bracket around that. Also, how do we work multi-domain to get the understanding, to interconnect with all the products that we deliver for the various domains? And indeed, as you say, there will be a second pillar where we would bundle our large programs together with some transversal elements that we have today, which we will further cultivate on airworthiness, on cyber, on cloud and IT technologies, and all of that, so that we kind of encapsulate that know-how in a very strong structure with, of course, operational mindset on one hand, but also the conceptual and customer mindset, in order to deliver solutions in the future effectively. Yeah, and, Sash, hello. First of all- Yes. Your question on the reporting. So currently, we have two segments, and you know, the product segments, we were discussing about that. In the Sensors segment, we have today the radar business and the SDAS business, Spectrum Dominance, where Pegasus is a part of it and the respective service. ESG is now part of the Sensors segment. So going forward for this year, we will not change anything on the segments. With the discussions what Oliver has outlined, we will also do a review regarding segments, technology-wise, and if we do an adaption. For the time being, it will stay constant, so Pegasus as well as ESG will be part of the Sensors segment. If there are any changes, we will inform end of this early next year if there is a change. Great. Thank you very much indeed. The next question is from Christophe Menard with Deutsche Bank. Please go ahead. Yes, good afternoon. Thank you for taking my question. I had actually, I think two left. The first one is on the operating leverage in sensors. I was positively surprised by the good margin performance and the incremental margin or the, I think we call it the drop-through margin, on your new business is 27%. Is it something that is only deriving from TRML-4D? And what does it correspond to? I mean, you're not finished in the ramp-up, so should we expect more of that operating leverage? That's the question. And what is the impact on the midterm guidance? And the second question is on the optronics. I mean, thanks for the detail, the color you provided about the rising volumes. Does it mean that those optronic systems, you actually build them when you deliver them, or is there any progress payment? Because H1 was actually not great in terms of sales. So should we expect just a bump in revenues as you deliver them because you're gonna build them as you deliver them? Thank you. Hi, Christophe. Thanks for your question. So in terms of operating leverage, yeah, it's nice when you, you surprised you in terms of profitability. So I have to say, we are good on track in this regard, and it's also it remains mainly on air defense and, and also in TRML-4D, but also in SPEXER and, and other products in this regard, where that we see good margins, and we are on a very good track in this regard. So but you also know that Q4 is our heaviest quarter, and we will see how this, how this develops, but I'm very confident that we do a good margin also this year. Going forward, there is potential, and we discussed it already several times. For the time being, I stay with that because and Oliver has outlined on that we are a high technology company. I can only reinforce this day by day. We have to take thoroughly investments in order to cope with this high technology and stay at the edge. But in terms of operating leverage, we see going forward, of course, opportunities. Let's see how we reinvest this and what is the impact on the margins. ... In terms of optronics, yeah, you're right. It's the revenue is strongly connected to the deliveries, and the deliveries now will ramp up in the second half year. So it's a Q4 is also here, the business is Q4 loaded, because in terms of deliveries, also the customer is still very focused on Q4. And with that, we will see a growth in Q4, especially in the optronics German business, and this will offset then the reductions of Africa. Thank you very much. The next question is from Simon Keller with HAIB. Please go ahead. Hi, everyone. Thanks for taking my questions. I have two, and they are both on the air defense area. Firstly, in the news, I read that there are a couple of TRML-4D orders pending in H2, for example, by Lithuania, but I think also Switzerland and Austria seem to be likely candidates. Yet, you did not put them on the expected order slide for H2. Am I wrong in assuming that they are likely to come, or is there any other reason? And secondly, on the SPEXER or Skyranger opportunity, I was wondering, is your radar always implemented on the platform, or what's the likelihood that the customer chooses your radar? Maybe can you give some midterm potential, like you did in the last call for the TRML-4D, i.e., how many customers are expected to choose the SPEXER radar, and also how many would they then need? Thank you. Okay. As a former air defender, Simon, I will try to answer your questions. This is Oliver speaking again. So, first on the TRML-4D, I think as we had clearly outlined in the introduction, we have today the German customer, of course, with NNbS, where now after the developments, we have major batches coming in. And of course, based on also a first batch, which is rather dedicated to surveillance, part of an urgent operational requirements, we also see more possibilities. Then we have Ukraine, as you also know, and yes, indeed, currently, we see that the first customers are moving in on the ESSI. So this is Latvia, it's Slovenia, it's Romania, we're discussing Estonia. Indeed, also, Switzerland has started a tender on a new air defense system, which is, I would rather say, orienting in the sense of ESSI. And, despite that, there is competition out there on the market, I'm proud to claim that our radar is the only one, really, despite probably US technology, European radar in strong operations day by day, also looking at the quantities we have contracted and deployed to Ukraine. And in that regard, I'm really confident, and I explained that in one of the previous calls, that we see only in the medium segment a rather EUR 2 billion potential to be addressed. We are currently doing the math on our future planning, where we more detailedly, as now the various nations are dropping in. We had many discussions at Eurosatory, at Berlin Air Show, where now we are consolidating this picture and see it moving in. And a very clear reference for our confidence is also that we are continuing, despite that we have increased from three radars to 15, we are continuing to put efforts in how could we scale. Also, strong discussion with UK, which also raised a strong interest in the medium segment on TRML-4D, and I think that's just a couple of nations where we are in mature discussions. And on top of that, I think it's a market that is just about to open. Second question on SPEXER. Here, at least on the first part, this is linked to the vehicle. And as a matter of fact, as time to market is very decisive today, and we're pretty advanced on the Skyranger, integrating it with Rheinmetall. We saw also in the recent orders that we have announced in the presentation, that yes, there has been a discussion, would we choose the HENSOLDT radar or are there other options? But when it came to looking at integration risks at time to market, the HENSOLDT radar was a natural choice, because it's very well integrated in the conceptual setup that we see today, and that is what we want to leverage on. In order to secure that for the future, we have, I would say, a very advanced concept that we can have a full antenna, half antenna, a quarter antenna. So that also with that, looking at different vehicles, different setups, we are very flexible to integrate our SPEXER technology into this short-range air defense environment, which I think is a very unique and strong selling point going forward. And for the last part of the question, I'm sorry, I can't give an answer at that time, but we will keep that topic and probably address it also to IR. ... Great, that's helpful. Thank you very much. The next question is from Yan Derocles with Oddo BHF. Please go ahead. Yeah, good afternoon, everyone. So maybe three, three left. One, maybe on your priority, internationalization, because if we analyze your order books, well, we do not have the full details, but I believe that Europe and Germany come from more than 80% of the total order book. So I wanted to know whether M&A will be in the future the focus, I would say, to improve the non-European position. So you are targeting 20% of your turnover mid-term, and I was wondering if M&A was the option to improve this part of your business. Then a question on ESG. Can you remind me when the earn-out will be paid, and what are the main underlying assumptions for this EUR 55 million payment? And maybe the last one for Oliver. We've seen that Leonardo was, I would say, talking to Rheinmetall about an alliance in land armaments. And I was wondering if this initiative was changing anything in your relationship with Leonardo now and ESG? Thank you. Okay. So, let me take the first one, internationalization, also to put a little bit more meat to the bone. Indeed, you rightfully described the dependencies, I would call it, and it's positive dependencies, on the German and probably Europe now with ESG moving in, as I have explained, that indeed also ESG now with a very high part of the business being related to Germany. I think with Germany, we're at roughly 2/3, almost 70% of our business today. And the majority of the business, despite a couple of customers globally, is then in Europe. So when I introduced in my presentation, the 50-30-20, that is, of course, a kind of guidance which I would see on the midterm, also to guide my international business development team, which so far successfully, but so far has been acting rather opportunistic. So how do we want to do that going forward? I think first thing is more focus. So part of the internationalization initiative that we're also doing with a consultant at the moment, is to provide, I would call it a clear matrix, where we outline to our teams, what are the countries that we want to address, and what are the solutions that we want to address, which again, so far has been very opportunistic. And I think if we apply more focus, and that is somebody who has been quite successfully, I would quote and claim, a VP sales and marketing in, in Thales for five years, I, I think it's all about focus, really tailoring your efforts, which will help us in, in the, in the very strong pipeline. As a matter of fact, we just had our order intake review, the first initial kickoff, two days ago. And I think if, if we really focus on our strengths and the strong leads that we have, we will be far more successful than only diluting across a manifold, a multitude of, of customers. Second thing, is looking at the how do we sell? And I think, also, coming from Thales, but also with Frequentis before, and working a lot in sales and business development, I was very much used to account management. And here is it really about strategic accounts where we go B2C, where we would rather systematically sell and interfacing between a central sales force and divisional sales leads, which naturally have to be with the products and the solutions. But I think to bring more efficiency in that cycle and a clear strategy leading our activities, will not only give us efficiency, but also help us to be more successful. And talking key accounts, I think as a product house with two divisions, and strong product business today, and still core business of products in the future, it's more important to systematically address the OEM, selling B2B. And I think here we can do better addressing shipyards. I think with the vehicle manufacturers, Rheinmetall, KMW have been mentioned, KNDS, we're also General Dynamics. So many of them, we have good relations, but I think we can more institutionalize those relations to bring the scale to the sales of our products, especially as also on the product portfolio with Quadome, you saw our recent success in UK. We are also entering new products, cost performance, not only addressing the high end, where definitely we can sell by volume if we really systematically develop our channels. And last but not least, yes, indeed, once we have recovered our leverage and everything, it remains that technology and internationalization remain our criteria for M&A. ... Yeah. Hello, Jan, your question on earn out. So there will be a second earn out component. It relates to the order intake of the ESG business 2024, and will then be paid if they reach a certain amount of orders by 2025, as opposed in the first quarter. On the last question, I mean, very clearly, it's probably too early to state. We're following the media and definitely, I mean, considering that Leonardo is our shareholder, but also a very good partner since many years, you know, Eurofighter, all of that. We are, of course, in close contact, close relation, as a matter, I can say I had a good alignment with the management a couple of days ago. So we are, and I think I have stated that in one of the previous calls, we are continuously evaluating what could be the cooperation. Because it's my true belief, and I said that we want to actively steer the European consolidation. So it's my true belief that consolidation should be an end to a means to an end, yeah? So it's all about cooperation, bringing Europe closer, bringing standardization on the market, making it more modular. And in that regard, I mean, looking at more than 100 tanks that will be delivered to Italy, which are now, of course, driven by Rheinmetall. Let's make sure, as we're the incumbent and the major technology provider for the Leopards, that we also engage with Leonardo, again, as a shareholder, our strong partner, to make sure that we support Leonardo in bringing the best tanks to Italy. And that is the discussions we are having, of course, not concluded. That is very clearly to say at that stage as a disclaimer. Very clear. Thank you very much. The next question is from Christian Cohrs with Warburg Research. Please go ahead. Hello, good afternoon. Thanks for taking my question. You're striving for an organizational transformation, you are in the midst of a major integration task with ESG. You are ramping up your business and preparing for future growth, and then your COO resigned a couple of weeks ago, and I assume that the COO is a key management position in the, yeah, operational phase you are currently in. So this, of course, can be a coincidence, but, I think it also raises questions, and it, I think it also needs to be addressed. And against this backdrop, maybe you can shed some light on that. Thank you. Yes, of course, Christian. So first of all, maybe just to repeat what I explained on the divisional setup. So the organizational transformation and the ESG integration is, I would say, a seamless transformation that we're doing at the moment. So that is actually why we're doing it. So I would not see, I would say, separate building lines for that. Second part of your question was, how does that interfere with the operational excellence, with scaling our business in quantity and quality? And again, also here, I would say, it is a means to an end. I mean, the operational transformation that we are doing is actually to catalyze many of the efforts that the team before I joined HENSOLDT took with HENSOLDT Go, which we kind of put in a broader framework now, and we're running that in the direction. So coming back to the COO, I think we put a press release on this one. So I would just refrain from entering those speculations, which were also in the media, that these things are together. Maybe it's just worth to note that the COO position that Celia Pelaz took was newly funded. So that means, the interaction, as you say, your concern, that now putting this function out could put a threat to the system in the sense of discontinuation, is not the case, because it was newly funded. We're running a couple of activities in operational excellence, which I think were initiated also on my behalf. And I can just assure you that especially with a very strong alignment between me and Christian, we will sustain these efforts that are ongoing, and I don't see any disruption on the case. It's rather a personal decision of Celia looking, and we have full and great respect of her achievements within HENSOLDT, the successes really that the HENSOLDT, as we see it today, takes her handwriting in many cases, as she was the Chief Strategy Officer, Chief Sales Officer. But again, now, a new setup, a very highly motivated team, which we could see at our recent sales leadership team, and I think a very united board here. So in that regards, no worries. We walk the talk, we run our way, and I definitely think in line with the guidance we have provided, HENSOLDT will continue on the success street. Okay. Thank you. Ladies and gentlemen, that was the last question. I would now like to turn the conference over to Veronika Endres for any closing remarks. Thank you all for listening today. As always, should you have any further questions, the IR team is happy to follow up. And with that, have a lovely weekend. Thank you and goodbye.