Morning, ladies and gentlemen, and welcome to the RENK Group AG H1 2025 Conference Call. At this time, all participants have been placed on the listen-only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Christian Weiß, from RENK Group AG Investor Relations. Thank you, operator. Good morning, everyone, and thank you for joining our H1 2025 conference call. I'm Christian Weiß from the Investor Relations team. Our CFO, Anja Mänz-Siebje, and our CEO, Dr. Alexander Sagel, will talk you through today's call and will be available to answer your questions afterwards. With that, I will hand over to Alexander. Christian, thank you very much. Ladies and gentlemen, also from my side, a very warm welcome and many thanks for joining today's call. Today's presentation consists of three parts. Firstly, we will provide a quick review of the highlights and financial performance of the first half of 2025. Secondly, we will guide you then through our key financials in more detail, including Q2 figures. Anja will take over this part later on. Thirdly, we would like to share with you a more forward-looking perspective regarding our 2025 guidance, upcoming key order intakes, our view on the German procurement process, as well as the key priorities for the rest of the year 2025. To sum it up, and before going into details, we are fully on track. Now, let's move into the presentation. Let me start with a short overview of the key highlights from the first half of 2025. First and foremost, we achieved a strong order intake of EUR 921 million, representing a significant increase of +47% compared to half-year one 2024. You can see some of the main drivers and projects for this strong order intake on the right part of the slide, and I think many of these projects are very familiar to you. I will not go through all of these, but of course, on top of this, our source transmission contract in the U.S. For an international customer, we sold transmissions and engines as well. We had various new contracts on the Navy segment. It is an ongoing developing story regarding spare parts, especially here in Europe for the MBT, for the main battle tank of the Leopard. Finally, and this was also a very important order, we got the contract for 52 transmissions for the Ajax IFVs, where 44, round about 42 to be correct, were for Latvia for the first procurement program, which is, from our point of view, a clear indicator of our growing presence in the Baltics, the so-called eastern flank of NATO. As a result, our book-to-bill ratio increased to 1.5 compared to 1.2 for H1 2024. Our total order backlog reached a new record level of EUR 5.9 billion for the end of June, coming from EUR 5.0 billion at the end of 2024, providing a strong visibility and confidence for the upcoming quarters and years. Like for the previous quarters, our defense segment was clearly the growth driver with high double-digit growth rates for order intake and revenues, and reflecting both the structural upturn in demand as well as our execution capabilities. In addition, we made good progress with the PMI process of SensorNet Engineering Systems, or how we call this company today, RENK America Marine & Industry. Lastly, we also initiated new strategic activities regarding our future product portfolio, for example, talking about our new strategic partnership with ARC or the series development and qualification of our next-gen main battle tank transmission. More on these two specific relevant technology projects later in the presentation. Ladies and gentlemen, let me now move to the overall group performance for the first half of 2025. Besides the already mentioned record order intake level, the revenues came in at EUR 620 million in H1 2025, corresponding to a +22% growth versus the first half of 2024, which is well above our 15% CAGR midterm guidance. Moreover, the adjusted EBIT increased by +29% to EUR 89 million, once again outpacing the revenue growth. A strong defense business, scale effects, and operational performance at our core production sites are here the main contributors. As a result, our adjusted EBIT margin improved to 14.4%, or 0.9 percentage points year- over- year. Having a quick look on the right side of the chart, you can see that our overall business development shows a further increasing share of our defense business and a stable aftermarket business. As you can see, the revenue split by sectors is now on a 12-month basis at a 74% level for the defense business and 26% for the civil business. The share between new build and aftermarket remains stable with a 62%-38% ratio. To sum it up, a very solid first half-year performance in terms of top line, momentum, and adjusted EBIT and related profitability. Moving on to slide three and having a quick view on how I call it pure defense play perspective. As already mentioned, our defense activities, which include both land and sea domain, remain the cornerstone or backbone of RENK's growth story. H1 2025 order intake rose by +46% year- over- year to EUR 694 million, while revenues climbed by +32% to EUR 462 million, reflecting not only a strong demand environment but also our ability to convert backlog into deliveries at increasing scale. Now, very quickly, before we go into more financial details by Anja, a few words about the individual segments. As said before, more financial details later by Anja. Starting with our VMS segment, which continues to be the main growth driver of the entire group. In the first half of 2025, we achieved a very solid order intake of EUR 681 million, reflecting a sustained customer demand across both new build and aftermarket. Operationally, the performance of our two main plants, VTA in Augsburg and RENK America in Muskegon, remains strong. In particular, RENK America reached in June a new monthly output record of 91 transmissions. If we convert this into daily production rate, it's above norms of four transmissions per day, underlining our improved manufacturing performance and execution capabilities, especially compared to our challenges we were facing in half-year one 2024. As a consequence, on the revenue side, the segment delivered a strong year-over-year growth of +32% in H1, with revenues increasing from EUR 295 million- EUR 389 million in H1 2025. Let's now turn to our marine and industry segment, which also delivered a solid performance in the first half of 2025, despite GDP-related headwinds for our industry segment and thanks to the good run of our Navy business. Driven by several larger orders of our Navy business, as mentioned before, the order intake came in at EUR 183 million for the first half year, reflecting an increase of +16% year- over- year. On the revenue side, the strong Q2 2025 helped to overcompensate our Q1 performance and shifting growth rates back into the positive territory. As a result, we realized the growth of approximately 9% year- over- year in H1, with revenues increasing from EUR 162 million- EUR 176 million in H1 2025. Last but definitely not least, our slide bearing segments. Like our industry transmissions, also the slide bearings were and are facing a challenging market environment. Nevertheless, slide bearings showed a robust market performance where the order intake reached EUR 66 million and where the revenues were even slightly above last year's level. The backbone of the slide bearing business remains the e-bearing segment, thanks to the unique material and surface technology competence of slide bearings. Finally, and before I hand over to Anja, a few comments on the total order backlog. At the end of June 2025, our total order backlog reached EUR 5.9 billion, a new all-time high for RENK, and we are very proud about this, by the way. This corresponds to a 4.7x coverage of our last 12 months' revenue and provides us with an excellent visibility for further growth going forward. Compared to a year in 2024, we could uplift the fixed order backlog by nearly EUR 300 million, driven by the strong order intake level mentioned before and overcompensating our increased output level from our operation. Our highly visible soft order backlog ended up at EUR 2.8 billion compared to EUR 2.2 billion at the end of 2024. Important to note that we have included, on a conservative basis, first volumes and projects from German procurement programs until 2029. We are currently entering into first discussions with our primes and do expect first orders during half-year one 2026. I will come to this point later in the third part of our today's presentation. Ladies and gentlemen, having said this, I would like now to hand over to Anja in order to have a much deeper look into our H1 and Q2 figures. Anja, over to you. Thank you, Alexander, and hello everybody. I'm glad to have the opportunity to guide you through our H1 financials. I will start with our group's growth metrics, followed by a closer look at the performance across our segments. In the first half of 2025, RENK generated an outstanding order intake of EUR 921 million compared to EUR 627 million in the prior year period. This significant increase of 46.8% was due to our military product portfolio, especially driven by our VMS segment, as mentioned by Alexander. To put this into perspective, we managed to acquire EUR 373 million in Q2, even after EUR 549 million in Q1 2025, and EUR 584 million in Q4 2024. Group revenue stands at EUR 620 million at the end of the first half year, also representing a substantial uplift of 21.5% or EUR 109 million compared to last year's period. VMS alone contributed EUR 94 million to this accomplishment. I would also like to point out our Q2 performance with an even higher 27.5% increase on a quarter-to-quarter basis. As already highlighted by Alexander, we added EUR 294 million to our fixed order backlog over the past six months, representing a 14% increase, continuously demonstrating our growth path. Let me continue with a look at our profitability and net debt ratio. On a year-on-year basis, RENK increased its adjusted gross profit by EUR 33 million- EUR 171 million. This represents a material growth rate of 24%, with a notable outpace of our revenue increase. Besides higher volumes and associated economies of scale, our operational efficiency gains laid the foundation for this development, especially due to VMS and our plans in Muskegon and Augsburg. Profitability was supported by M&I and slide bearings, both of which delivered robust contributions through their high-margin business activity. H1 confirmed our anticipated full-year performance as demonstrated by our 29.4% increase in adjusted EBIT, totaling EUR 89 million compared to EUR 67 million in the same period last year. Despite the ongoing expansion of our business, we maintained disciplined cost management with outstanding adjusted EBIT development yield, a strong adjusted EBIT margin of 14.4% compared to 13.5% in the same six-month period last year. As already stated, in relation to our Q1 2025, we see a net debt increase of 1.8x of LTM adjusted EBITDA, also at the end of H1 compared to 1.7x at the end of fiscal year 2024. Our cash position at the reporting date continues to be the main contributor, which is impacted by cut-off effects. We consider this development aligned with our current operational activities. Now, let's have a more detailed look at our segments. As already indicated, VMS continues to provide excellent results. Order intake in H1 amounts to EUR 680 million after EUR 410 million in the comparison period. This reconciles to an outstanding 65.9% increase year- over- year. Q4 2024 and Q1 2025 were already outstanding, so not surprisingly, Q2 could not keep the same pace. Nevertheless, it still added high volumes to our fixed order backlog related to our military product portfolio. Our segment's book-to-bill ratio has risen and amounts to 1.7x compared to 1.4x in the prior half year. VMS revenue numbers prove our assertion that VMS was the key driver of the group's revenue growth, both on a year-to-date and quarterly basis. Volume output in Muskegon and Augsburg developed in line with expectation and was facilitated by strong and efficient operational execution. VMS also strongly delivered on profitability. Adjusted EBIT and adjusted EBIT margin show a steep uplift, even outpacing revenue growth and enhanced by our strict cost management. Adjusted EBIT landed at EUR 66 million compared to EUR 45 million in H1 2024. Adjusted EBIT margin for the H1 period came in at 17% after 15.6% in the prior year. On a quarterly basis, Q2's margin was even higher at 17.5%, also compared to Q2 2024, with it 16.4%. Let's move on to M&I. M&I order intake during the first half of the year amounted to EUR 182 million after EUR 156 million in the comparison period. From a group perspective, M&I's marine solution represents a stable and reliable contributor to fixed order backlogs. The segment's book-to-bill ratio at the end of H1 remains stable at around one time, with a slightly improved growth momentum in the current year's period. M&I revenue in the first half year has grown notably by 8.7%, resulting in EUR 175 million after EUR 161 million in the prior period. The incline in industry-related applications was outpaced by marine business, which continues to show a solid growth momentum. Q2 performance heavily added to this performance compared to the Q1 dip seen earlier this year. The shift towards marine business also accounts for profitability increases reflected by higher adjusted EBIT and adjusted EBIT margin on a year-on-year basis, and even beyond our H1 revenue growth path. A quarterly adjusted EBIT margin shows a notable dip. This was primarily driven by our single customer relationship, resulting in a one-time expansion of the product offerings due to third-time components which carry lower trading margins. Last but not least, let's have a look at our third segment, slide bearings. Consistent with past performance, our smallest segment continued to deliver the highest profitability. Despite minor fluctuation, also growth indicators are holding steady. Demand for E and marine bearings continues to be on a high level. On a relative basis, however, we see a moderate decrease in order intake of -5.5%, which stands at EUR 66 million at the end of H1 2025, compared to EUR 70 million in the prior year. The segment's book-to-bill ratio remains stable at around 1.1x, still above one. Revenue in the first six months developed in a stable manner and came in at EUR 62 million after EUR 61 million in the prior year. As already mentioned during Q1, slide bearings' revenue trajectory is intact with a gradual but steady improvement for the six-month period. As indicated at the beginning, profitability remains high and above this level, both on a year-to-date and quarterly basis. However, in H1 2025, we have seen a moderate dip in adjusted EBIT to EUR 10.4 million after EUR 11 million in the comparison period, in line with a decline in adjusted EBIT margin. We view this as a short-term slowdown due to a slightly weaker product mix in the first half of this year due to the economic environment. After this close look at our segment, I want to continue with our adjustments. Operating profit came in at EUR 59 million after EUR 35 million, thanks to our volume and revenue growth I already mentioned earlier. When adjusted for PPA effects, we land at EUR 81 million compared to EUR 56 million in half-year 2024. Adjustments mainly relate to global process and system improvements, M&A-related activities, and other minor components, mostly due to consultancy fees. The overall level of adjusted non-PPA items is significantly lower compared to prior years. Let me continue with a detailed look at our net working capital development. Our net working capital at the end of the second quarter stood at EUR 340 million compared to EUR 284 million at the end of December 2024. After adjusting for cut-off date-related effects in trade receivables, payables, and prepayments, the remaining increase in net working capital is primarily attributable to higher inventory levels. The latter primarily relates to the VMS segment, reflecting work in progress as well as planned production requirements. As a result, net working capital as a% of LTM sales stands at 25.1% compared to 24.9% at the end of December 2024. Given our current growth opportunity, we currently also need to focus on customer expectations and delivery requirements. The increase in net working capital has a direct impact on free cash flow, which we will now examine in more detail. When taking a look at this bridge, only a few major effects are left over that are noteworthy. As you're already familiar with the convincing development of our adjusted EBITDA and the drivers behind the increase in net working capital, it is important to highlight that the latter significantly impacted cash flow due to capital being temporarily tied up. Capital expenditures into property, plant, and equipment amounted to EUR 11 million, representing 1.7% of revenue, remaining below our benchmark level of approximately 3%. I would like to highlight our measures to reduce our effective tax burden. Thanks to a control and profit transfer agreement between RENK Group AG and RENK GmbH, we could effectively make use of tax loss carryforwards of RENK AG amounting to EUR 11.9 million for corporate income tax and EUR 11.6 million for trade tax purposes. In addition to that, we now can capitalize until 2027 our U.S. interest carryforwards in total EUR 39 million due to a debt-to-equity conversion related to our U.S. entities. We expect that our effective tax burden will benefit going forward from the aforementioned measures. Interest payments in H1 2025 reflect a normalized level in line with our current financing structure. Taking all components into account, free cash flow was positive at EUR 11.5 million after a negative cash flow of -EUR 7.5 million in the first half of 2024. Beyond free cash flow, I would like to highlight significant cash outflow items in Q2 2025. Our investing cash flow was impacted by two major items. First, the purchase price payment for the acquisition of assets and liabilities of Cincinnati Gearing Systems amounting to EUR 23.9 million. Second, we acquired certain assets from a former supplier, Midwest Gear and Tool Inc., for a total consideration of EUR 6.2 million. With regards to our financing cash flow, I would like to point out our dividend payment of EUR 42.7 million in June this year. This item came in earlier compared to prior year due to our annual January meeting at June 4th, that is three weeks earlier than last year. At this point, let me thank you for your attention. It was a pleasure for me, and now I will hand back to Alexander. Yeah, thank you, Anja. Ladies and gentlemen, now a few words to our outlook. Starting with the guidance. Regarding our 2025 guidance, we do confirm both revenues of more than EUR 1.3 billion and an adjusted EBIT between EUR 210 million- EUR 235 million for 2025. Regarding our midterm targets, we are following in detailed discussions the future defense budget allocations and national procurement programs, especially for Germany, and will present our new 2030 midterm targets during our Capital Market Day in November this year. Moving now to slide, I think number 19, if I'm correct, where I want to provide a brief overview of some key order intake programs for the upcoming 12 months. I will not go through all of this, but I will explain maybe some of them. Very important for us, and we see this during the fourth quarter, the finalization of the SOAR 4 framework agreement, which certainly has over the entire lifetime the largest order volume potential up to between $800 million up to almost $1 billion over approximately three years plus one or two optional years, but we need to be careful. The order intake contracts will come on a year-by-year basis. We talk about also in the fourth quarter about Patria Service in the first order intake from Patria's APC. We talk about an additional MBT batch for K2 Poland. We talk about IFV programs where we need to be honest if we talk about Latvia. We already received in the first week of July the second batch, additional 42 IFVs from Tide Ajax. Of course, we are targeting various additional Navy programs. Also interesting, of course, the spare part development for VTA is obviously what we can see since February this year, an ongoing story, but we are also looking forward for a main battle tank test rig for the Netherlands Army and so on. Moving into the first half of 2026, we do expect first orders from Italy for the IFV and MBT programs and further orders based on K2-based support vehicles for Poland. Finally, Germany, where we do also expect to see the first major orders from main programs like the Leopard 2, Puma, Boxer, and Panzerhaubitze 2000 during the first half year 2026. On the next slide, and I think this is a good occasion, I would like to explain the German procurement process as we understand it from today's point of view in a little bit more detail. It's a complex chart, I know this, but nevertheless, please give me a try. Starting from the top of the chart, Germany's defense procurement process for the mentioned tracked and wheeled platforms, but also for the overall procurement process for all other types of systems and domains across all capabilities, will take place in two phases. First, during phase one, which is going up to 2029, 2030, Germany is focused on closing critical capability gaps, or in different words, getting ready to fight. During phase two, which is running up to 2035 and beyond, the execution of the NATO requirements is the key driver, increasing in volume. We expect first customer contracts between the German government and primes to be signed by the end of this year so that the first contracting between primes and RENK on the other side should then take place during the first half of 2026, leading to first order intakes for RENK. Revenue conversion will, of course, depend on the specific contract terms, for example, contract start time, overall time period, etc., etc., and will most likely not start before 2027. From our today's estimate, we do see order intake and subsequent revenue potentials between EUR 800 million up to EUR 1.8 billion for new platforms, +EUR 400 million up to EUR 900 million for aftermarket maintenance and the circular reserve. Please keep in mind that these ranges must be further validated during the upcoming months and contracting period. Ladies and gentlemen, let's move forward to the next slide. The overview of key priorities for 2025 has not really changed compared to the first quarter. Strong focus on operational performance, conscious capital allocation, preparing the future, and preparing for the upcoming programs from Germany and Europe. Nevertheless, please allow me to comment on two specific points. First, it's important to mention that we are right now during Q3 going live with our new production line concept here in Augsburg. The new line concept will provide us with greater flexibility, better capacity allocation, and increased production efficiencies. Second comment, the second half of 2025 will also play a major role in executing our technology and product strategy. With the new strategic cooperation with ARC Robotics and the start of the service qualification of our so-called next-gen main battle tank transmission, we are on the way to realize major milestones for our future business development and future market position. Regarding ARC Robotics, we signed in July an MOU for a strategic cooperation with focus on three main pillars. First, joint market exploration of ARC today's UGV portfolio. For example, if you take the U.S. market by using RENK's production footprint and RENK's market access as just one example. Second, further digitalization of our RENK's today's product portfolio. Third, the development of new own concepts for multipurpose UGV platforms between 5 tons- 20 tons. The joint teams between RENK and ARC have started working on these pillars, and we do expect first results during H2 2025. For your information, ARC will also take part at our Capital Market Day in November 2025. On the heavy platform side, we are moving forward with our next-generation main battle tank transmission, which features a fully digital drive train with drive-by-wire technology, which is based on a modular configuration concept and which defines with more than 1,400 kilowatts a new RENK benchmark in performance. We will showcase this new MBT transmission next week on a dedicated media roundtable on August 20th. Before, ladies and gentlemen, we move on to the Q&A session, let me briefly recap the key points of today's call. In the first half of 2025, we delivered a strong performance, improved on a record order backlog level of around EUR 6 billion, and we confirmed our guidance. A massive thanks to all RENK employees for this performance. Furthermore, we are in a great position to handle the expected increase in German and European defense budgets over the coming years. Our well-invested asset base, our improving operational performance, and a clear production strategy provide us capacity and flexibility to respond quickly to these opportunities. Finally, we have initiated major product and technology programs to secure our leading market position for the future. Finally, a small but important comment on our financial calendar as shown here on the last slide. Please make a big, big, and fat note for November 20th, 2025, for our second Capital Market Day, which will take place here in Augsburg on this date. Further information and more details will follow in due course over the summer months. However, we will provide updated information on topics such as sector strategy, update on the 2030 midterm targets, and the relevant and required capacity ramp-up, the production strategy, technology. I think I teased a little bit the topics just before, M&A, and more. Also, we are already looking forward to further engaging with you in many roadshows and conferences in the second half of this year, as you can see on this slide. Thank you very much for your attention, and we are now looking forward to your questions. Thank you very much. Ladies and gentlemen, we will now move on to your questions. Questions can only be placed via telephone keypad. If you would like to ask a question, please press nine, followed by the star key on your telephone. If you wish to cancel your question, please press three, followed by the star key. We already have a question. We start with Sebastian Growe from BNP Paribas Exane. The stage is yours. Good morning, everybody. Hi, Anja, and hi, Alexander, Christian. The first one is on the defense business and the German potential. You have raised the German potential by about $300 million, $400 million from the earlier provided range for the related upside potential in Germany. As you pointed earlier to the importance of the number of heavy brigades with the creation of the Q1 call, my question is, how has the number of brigades changed in that very, very assumption here? Especially in the wake of Germany having published its 3.5% defense spending target in 2029. More specifically, and especially also as there are five-digit numbers making the rounds in the media for tactical vehicles going forward, can you help us with the rough product mix that you expect here? I think you also depicted some of the products where you would see your transmissions going in. We could start there. Hi Sebastian, thanks for this question. Starting with the product mix, I think what we considered here are the for RENK relevant key platforms. If you talk about Leopard 2-based main battle tanks, if you talk about Leopard 2-based fleet support vehicles, if you talk about Puma, the Panzerhaubitze 2000, and the Boxer. I think on the volume side, and this is always depending, and for this reason, I depicted here these two phases. It depends if you consider just a demand, what you need in order to comply to phase one, closing a gap, or if you look on the total span of 10 years, including phase one and phase two. To be honest, I think this is the trigger in order to understand the numbers which are currently in the market and also to understand from our discussions with the customers, the planning, the procurement, etc., to interpret. I think on the upper end of our potentials, as you see it here, for the new vehicles and aftermarket MRO and circular reserve, on the upper end, we have, just to give you a little bit of flavor, we have included Boxers in the range of 3,500. We have in similar understanding on platforms like the Leopard 2-based, where we are depending, and here we need further clarification during the next month on volumes between a higher three-digit number up to a four-digit number, if you talk about 1,000, for example. This is the reason why we are also still having this range, if we look on the orange bubble for new vehicles. It depends if we consider only one phase, if we consider two phases, etc. For the overall estimate, if we talk about order intake potential, to make the conversion on revenues, it really needs more intelligence in order to understand how the contracts will be designed. For example, will we get or will the primes get contracts for the entire phase one or phase two, or will the contracting start only with phase one and then after, I don't know, two or three years, start the contracting for phase two? This, of course, implies how the revenue conversion will take place. For this reason, we are also working with a range. What is clear, we have a better visibility, and this is, I think, what you also can see if you compare to our Q2 numbers, where we had a range indicated between $1.2 billion and $2 billion, starting with the lowest potential of $400 million up to even higher. We have a higher visibility, but we still need to understand how the contracting will take place and how especially the contracting will consider phase one and two or only phase one. Regarding the very famous, and I used it, number of heavy brigades, I think this has changed a little bit depending on the phase one and phase two. From our understanding, during phase one, there will be no additional heavy brigade. What will be used is, or what most likely will be done by the customer, again, according to our understanding, is existing brigades will be filled up with a certain number of main battle tanks, Pumas, etc., etc. The overall number of heavy brigades, from our understanding, will not change during phase one, but the gaps will be closed and the heavy brigades will be expanded. This is different to what will take place during phase two, where indeed additional brigades will be built up and there are numbers three, five, six, whatever. All this still needs to be validated in more detail. I think it's important to understand that the old parameter, a multiply and the number of more heavy brigades, is not materializing and not working, again, according to our understanding, for phase one. This was a long answer, Sebastian. I don't know if I fully complied to your question. That was a long question, I appreciate that, color. Thank you for that. The other question I have is also referring to the same slide, and that is more in conjunction with what you also put out as the aftermarket and the potential around the circular reserve. The question here is apparently you're pointing to a number of $400 million to $900 million. If I'm not mistaken, I think 40% is a pretty good proxy for the circular reserve as opposed to what you would find with the original vehicle shipments. I've applied that to the $800 million to $1,800 million range for new vehicles on that slide. It seems there is no aftermarket potential back then. Question one, could you comment on my math and what do you see really with regard to the additional aftermarket potential? I think the aftermarket and MRO potential is more or less what we do assume on this 40% share. I think one observation is correct if you talk about the circular reserve. There are different discussions in Germany and on the circular reserve. In fact, to be honest, there are two aspects. We could talk, or the German customer is talking to have circular reserve on a vehicle basis, just in case you have a conflict, you have a fight, and a certain number of platforms are destroyed. You have a kind of circular reserve of vehicles to put them immediately in action. Of course, we are talking about a circular reserve for transmissions. In the assumption in this current level between $400 million to $900 million, I would consider that our assumptions so far regarding the circular reserves are more on the conservative side. For this, we need to understand better in detail the upcoming months, how the customer really wants to, or the end user really wants to apply a strategy for the circular reserve. For this reason, yes, I think on the aftermarket and MRO, we are on this 40%, but the circular reserve is most likely on the conservative side. Okay. If I may, really last question quickly on Europe. I think on the last quarter, Nicole, you put the total European potential at between EUR 1.5 billion up to EUR 2 billion. Apparently, with the update and upgrade you applied for Germany, it's rather moving towards EUR 2 billion, EUR 2.5 billion on a simple math. My question then is, how is your assessment really of the opportunity in Europe changed in the meantime? You mentioned Poland, for instance. What might be really a refreshed target for total Europe if you already have that available? No, we do not already have this available because we need to take care, to be also honest, to make a clear separation and baseline between what we already see as projects, which we already have in our acquisition roadmap even before February 2025, and what is really coming on top of this new. If you take, for example, the Italian programs, which is dominant, or if you talk about prominent, if you talk about the Polish main battle programs, let's stay for a second on the Italian ones. There's a huge project. I mean, as you know, about 1,000, 1,050 IFVs, the AICS. This is in our terminology. It's not a new project which is triggered since February 2025 because on this project, we are working almost one year. It's already in our normal project pipeline. For this reason, for Germany, it's very simple to make a clear cut what we have in our order backlog, in our soft order backlog, and what everything is coming on top. On the European programs, we need, again, as I'm always saying, more color from the customer, from the end user side about their procurement and capability strategy. We need really to separate in order to prevent double counting. Yeah, that makes sense. Looking forward then to the CMD and we'll probably follow up with more questions later. Thank you. All right. Thank you very much. The next question comes from David Perry from JP Morgan. Over to you, David. David, this stage would be yours. Sorry, I was on mute. Apologies, hi everyone. Sorry about that. I've got three questions, please. The first one, and I really hope this isn't a silly question. Just on slide 21, just so I understand it a little better, what is being shown in the orange bubbles? Is this a cumulative sales number? Is it an annual sales number? Is it an increment to a base plan? Can you just clarify exactly what the bubbles represent, please? Hey David, hi. Sorry for the mute problem. I always have the mute problem. My fault. No, no problem. We are really talking about additional volumes and cumulated volumes. In our consideration, we do assume we take phase one and we do take phase two. For this reason, the numbers you see here is a range for the total cumulated figures. We try to make it really clear because it's important to separate between new vehicles and aftermarket MRO and circular reserve. Why? The revenues coming from new vehicles, they have a certain timeframe. If the first orders are coming in half-year one, 2026, we most likely start delivering in 2027. After a certain time, until 2035 or even before, the total new number of vehicles, wherever this new number of vehicles will be in the very end, will be delivered. This is something, kind of revenues, which if we know the exact numbers, if we have them under contract, we can really chop on a year-by-year basis and plan the revenue conversion. The aftermarket MRO, especially the aftermarket MRO potential, is for sure not stopping at 2035, but it's running on a much longer timeline. I think it's important to understand and to make this difference also by doing analysis and scenarios, how total order intake potentials for new vehicles and aftermarkets, MRO, etc., etc., are converted on a year-by-year basis, especially when we talk about, for example, 2030 timeframe. This is exactly the intelligence, what we still need to do to get a higher, really a final higher visibility of the real numbers. There are many numbers. We are doing our research, if you want to call it. You have many numbers in the media. Then to draw it as exactly possible on an annual slice in order to understand where we will be in 2030. Long answer, I hope it worked. Okay, that's helpful. It's added onto a base plan that you already have. Absolutely. I'll ask second and third questions together, if that's okay. The second one was, you've said you'll give new guidance in November on 2030. Just to be clear, is there any risk it's lower than the old guidance, the $2.8 billion, or are we assuming it's upside that you're thinking about? That's the second one. The third one, which I know is going to be a bit sensitive, maybe difficult for you to answer, but can you give us any more information on the story in the press last week about the German export ban to Israel and what it might mean for your work there? Thanks. Very good questions. We do not see, I mean, again, we are doing our math and we have to do our homework. I give you my gut feeling. If you talk about the midterm targets, I think what we will see is a much clearer picture about what we will do and can do and realize on an organic level and that any kind of M&A will come on top of this organic level. If I just refer back on our Q2 presentation, we had indicated a range or ambitions between $2.5 billion up to $3 billion, and we had a massive chunk of M&A as a red bar included. I think today, from my gut feeling, we are in this range, even at the higher range, just from an organic perspective. We need to see what could be on top of this. I do not see that we are going a step backward to answer this clearly. If you talk about Israel, this is indeed a political question. First of all, I will answer very formal. RENK is a German, is an international company, but based in Germany, and we have a headquarter in Germany. We will fully comply with the German law and regulation. Full stop. If there's an export stop, we cannot export, even if we would like it, but we cannot. Full stop. As a kind of side note, it's also fair to say that the official embargo is so far not approved or released by the German Security Council. It's a decision from the Chancellor Merz. So far, it's a kind of export stop. You can also imagine that RENK is in contact with the key authorities from both sides, from the German or with the German government and political parties, of course, but also with the Israeli parties and government and ambassadors, because for them, to be also honest, it really is a pain. They need propulsion. They need drive systems. We try to understand what the next process is and to see what is the next roadmap. For RENK, we have, I think this is also no secret, I communicated this to German stakeholders, we started to develop a plan B because you need to understand we have long-term delivery contracts. We have hundreds of transmissions under contract. We have a responsibility to make this clear towards Israel. If we cannot produce them in Germany, we will relocate these volumes to a different plant, for example, to the U.S. This might take maybe eight to ten months, but if there's no move forward, we will do it because we have this business. I think this is pretty much what I can say at this point. Please expect my or respect my apologies that I cannot disclose more on the contracts. No, that's very helpful. Thank you very much. Appreciate it. Thank you. Next is Christoph Menard from Deutsche Bank. Please state your question now. Yes, good morning. Thank you for taking my question. On the last question from David, can you actually state or give us what% of group sales are made with Israel? I can't really figure it out from your geographical breakdown of sales. The other question I had is on the, you mentioned when you talked about your soft order backlog that you already included some of the German orders. A rough calculation comparing Q1 to Q2 presentation suggests $300 million. Is it what you included in terms of German orders? The last question is on slide 19 on the order intake in H2. You added a few new pictures to that slide. Does it suggest that your order outlook for H2 is actually improved versus your Q1 expectation? Yeah, those were my questions. Thank you. Christophe, bonjour. I will do my very best also to answer these questions. Starting with Israel, I think it's fair to say that somewhere between 2% or 3% is our share in our current product and business portfolio. I would say between 2% and 3%. The second question, regarding the value or the share of what we included as a first and as I said, conservative approach, what we included in our soft order backlog, I stated conservative. This is really at the low end and is not related to the numbers I have on which slide, slide 21, I guess. We started first discussions and even that we have even today a higher visibility compared to our Q1 presentation, we are, as you can imagine, still conservative in what we consider as a soft order backlog. It's clear that if you look on these programs, RENK is positioned. From today's point of view, because there are still months to go, there needs to be the first clear contracts to our primes. For this reason, we were very conservative in what we included in our soft order backlog. I think I understood this third question, Christoph, about our H2 order intake programs. We have to be fair. We all know that order intake can vary in the magnitude from quarter to quarter because if you take the example, during the end of Q4, just before Christmas, we got, not by a little bit by surprise, three main programs in Germany for K2, Poland, etc., which from our planning and assumptions we had allocated in 2025. Around $300 million just moved into Q4 2024. If we take the last three quarters, adding Q4 2024, Q1 2025, and Q2 2025, we had an, to be fair, exceptional run of almost $1.5 billion of order intake. We see that we will have relevant order intake programs, especially in the first quarter. This does not mean that we have no order intake in the third quarter, of course. We had during the last two to three quarters an exceptional order intake. Overall, it's also clear with the discussion of what we had before, if you just talk about the German programs, the order intake level will, of course, over the time grow. This is when we look currently on our map, we see an agglomeration of what we consider some of the relevant order intake programs during Q4 2025. My question, Christoph, did I answer your questions or did I totally fail? No, you did. Absolutely. If I may, I just had one additional, I mean, on your slide 21, the range you're providing is pretty wide on new vehicles. You mentioned on the call that you're talking potentially three to six additional brigades. This is what that range reflects in terms of new vehicles? At the very end, yes. Again, it's a little bit more complicated because of the capability upgrade. It's maybe a wrong word, capability upgrade, but I do not find a different one. Capability upgrade process according to NATO requirements for the Bundeswehr. We have a phase where current gaps are closed, where we, from our understanding, do not see adding of additional brigades, heavy brigades. We do see a phase two where there will be additional brigades. Overall, in the sum, we are talking about the numbers what I indicated before. These numbers, there is a variance in. We need to understand more in order to really make deep dives into today's and future Bundeswehr organization, if you want to call it, in order to understand what the real volumes at the very end will be. Thank you very much. Thank you. Thank you, Christian. Thank you very much. The next question comes from Joe Orchard from Rothschild & Co. Joe, the stage is yours. Thank you very much. Just the one question from me today, and it's about transmission production, where you reached four a day in Muskegon back in June. Is that rate sustainable for RENK America in H2? Is VTA also producing at that rate and will continue to do so in the second half of the year? Thanks very much. Hi, Joe. Thanks for the question. I mean, you were just referring, and I would start answering this question to the 91 or almost, no, even north of four transmissions per day as a build rate in run. I would say it would be sustainable if it would need it, but we do not need this high build rate to be also clear. We are running for 2025, as I always communicated, and this is our production plan, on a total number of transmissions to be built in our RENK America facility north of 600. We are fully on our production schedule, and we had to produce this high amount because we had delivery obligations. We do not need to run on this more than 4.0. For us, it's enough if we run on 3.5 transmission build rate. We are, so if you want to say for run, fully on plan. If you talk about VTA Augsburg, I'm always saying, and this is unchanged, we are running fully on our production plan, on our monthly production plan. We are running fully on our targeted annual production volume of north of 700. Of course, we have variances on a month-by-month basis. For example, in Germany, we have so many crazy national holidays in May. For example, right now, as I depicted this, we are changing from the old production line concept at VTA into the new production line concept. We see for one month, but everything is planned and according to plan, a little bit lower volumes. All I can say is, Joe, we are running according to our production and delivery schedule what we need for this year. Okay, great. That's fantastic. Thank you very much. You're welcome. Thank you. Next up is George McWhorter from Berenberg. George, please state your question. Good morning. Thank you for the questions. I have two, hopefully, quick ones. Firstly, on your aftermarket business, please, can you just provide an approximate split of the revenue that you generate in this business between aftermarket MRO and circular reserve today? The second one is on the U.S. Abrams tank upgrade opportunity. Please, can you provide an update there? Also, does the next-gen MBT transmission, would that be suitable for the Abrams tank? Thank you. Hi, George. Thanks for the questions. To your first question, if I understood it correctly, it was referring to the split between aftermarket MRO on one side and the circular reserve on the other side. To be honest, I think in our today's calculation, especially if you look, I mean, I'm just referring now on the new potentials we were just discussing during the last half an hour. The vast majority of this business potential is with aftermarket and MRO because from our today's perspective, we have included very conservative assumptions about circular reserve. From the M1A3, so far, there is no official statement. As you know, we from RENK, we are in the race with transmissions and damping systems. We do expect that hopefully during the next weeks, at least hopefully before the Capital Market Day, to be honest, we have a final official statement and decision. For the next-gen MBT, this is really something that started, to be also honest, last year with the ATREX. The ATREX, what we showcased on our booth at the Eurosatory in Paris, was a kind of concept study. In the meantime, we have done our homework. We have done a lot of cost initiatives in order to make sure our transmissions are in the future, not only price competitive, but even showing at least to be on the same margin level. We have further refined specific features like, for example, drive-by-wire. We have started now, but we started in the second half, or we started in July. In fact, it's not really for the first half year, but anyway, it's partnered. With RENK Group. We We started now the series qualification. One of these projects, the first project where we sent this next generation or next-gen MBT transmission in the race, is for the Italian main battle tank program. Highly competitive from a technology point of view and also attractive from the pricing level, without, to make this also clear, compromising on the margin side. That's helpful. Thank you. Thank you, George. Thank you. Next question comes from Carlos Iranzo Perez from Bank of America. Carlos, please state your question. Hi, guys. Good morning and thanks for taking my question. I appreciate all the calls that you gave on German procurement and PMS. Just wondering if you already have any early indication or estimate on how much you could benefit from Germany on the defense side of your M&I division. Thank you. Carlos, to be honest, I did not fully get the question. Did you? I heard M&A and Germany, or I heard something totally different. Yeah. Let me repeat the question. I was asking if you already have any early indication in terms of how much you could benefit from the German procurement on the defense side of your M&I division. I'm sorry. Yeah, no worries. Thank you. This is also, of course, a good question. We see, and I think I indicated this in the last call, we see going through different programs like the F127, additional volumes, etc., etc. We do see a potential of a low, low three-digit million euro order intake over the time horizon with a clear timeframe and vision. You can read this if you, I mean, if you Google for it, Marine 2035 strategy. If we take this, we see that somewhere at the lower end of a three-digit million euro potential is accessible for RENK. Understood. Thank you. You're welcome. Thank you very much. The last question comes from Sebastian Growe one more time. Sebastian, the stage is yours. Thanks for taking those quick follow-ups, hopefully. The first one is just on the German pipeline. Just to understand how you think about competition, if there are any changes probably going forward, if it's not for the shorter period, but then for the outer years, i.e., what fit rate have you assumed when you're talking around the 3,500 boxes, for instance? Is there a bigger number underlying, but potentially some transmissions would go elsewhere? First question. The second question is, or maybe we take it one by one. It's easier, probably. Yeah. Hi, Sebastian. I mean, I think for the first phase and for the next five, six years, to be straightforward, there is no alternative. There's simply no alternative for RENK. Of course, and this is in general, and this is not only specific for the German programs, we need to prepare for the next generation of our product. We need to prepare that we understand that from other sectors, potentially, the competitors are newly rising. I like competition, and I cannot change it. We can, from our own perspective, be active and develop the next generation of products which are, from a technical performance, absolutely benchmark, but also from the pricing side attractive. There are many reasons why they are like this, and again, without compromising on the margin side. In general, if competition is not here today, if there's an attractive market, there will be competition tomorrow. We have the number one. It's always the most difficult position. We need to defend our position. We need to do our homework, full stop. Just a comment, Sebastian, on the Boxer side. I think it's very important, also for evaluating potential business impact, to understand that the Boxer is a wheeled vehicle. The transmission, the main transmission in the Boxer, is indeed not from RENK. This is a transmission, I think, from ZF, if I'm correct. At least not from RENK. What we have from the RENK side is, in Germany, we call it Winkelgetriebe. It's an angular transmission in order to convert the forces in an optimum way. This is the most expensive part of the entire drivetrain, but you cannot compare the pricing level of a main battle tank transmission with the pricing level of a Boxer angular transmission. There's a huge difference, at least factor 10. That's helpful. She had made the comment now around those specific transmission types. How would you see the competitive environment and dynamics eventually changing with the massive unit output increase that we should expect for future business from the German army in particular? As I said before, we need to be, in general, especially if you look on the long-term run beyond 2035 and beyond, we need to be competitive on the technical side. We need to be competitive. We need to be the benchmark on the pricing side. We need to have the capacity to produce. Honestly speaking, and I mentioned this before, RENK is in a perfect position. We have capacity today. We can easily scale up. We have our supply chain under control. We do not need to build new plants. We can use our existing footprint. We have good conditions, but this does not mean that we lay back and wait until competitors are coming. Makes sense. Two quick ones. One with regard to the output target that you mentioned, or the way there for Augsburg, the north of 700 units. To me, that doesn't sound too different to what you might have produced in 2024. The real question that I do have is follow-up to the last Capital Market Day where you also talked about the productivity improvements that you had online, etc. Where do you stand on the journey? Have you been able to readily indeed take down the overall tech times, etc., and how much of a capacity leeway would you still have for 2026 all as equal? I mean, we are, I would say, and for this reason, I mentioned all and also the important step, what we are currently doing during Q3 right now in our plant here in Augsburg to change the line concept. I think what we have realized in the last 12- 14 months, if you just look on Augsburg, we are so-called low-hanging fruits. I think Dr. Schiller will provide much more color on this during the Capital Market Day. These low-hanging fruits already, I mean, led to efficiency increases. What we see, Anja eluded it before, to an outpacing of the revenue growth by the EBIT growth. You can see this really specifically if you look on the DMS quarterly or half-year basis. What is important for us, if you just stay now for the moment in Augsburg, is really to change into this new line concept. With this new line concept, we will go really on the next level of having a higher flexibility of line allocation. Today, we have one line with one transmission type. In the future, we have the capability to put many, I mean, two, three or four transmission types on this line. With this flexibility, we also get a higher capacity and we will have increasing efficiency. In a nutshell, and I'm always saying this, we are somewhere on the journey between having realized, looking on Augsburg, maybe a 30%, 40% level. The next level starts now with this line concept. I'm really looking forward to welcome you, hopefully, all of you, on the Capital Market Day. You know I'm doing marketing now for the Capital Market Day, because then you will have, of course, we will go through this new line concept. You can see and smell and touch the efficiencies live on the floor. That sounds good. The very last one is just on the non-defense part of the portfolio. Unfortunately, that's one that's apparently now fighting a bit more with difficult macro environment and probably then also it's fair to say competitive dynamics. The simple question is, what is your response to address those challenges and what has been referred to by yourself as non-core operations? Yeah. I mean, it's a matter of fact that in our industry business, independent if you talk about industry transmissions or bearings, we are facing the typical GDP-dependent or related economy sector-wise headwinds. Of course, we cannot change the environment, but we are fighting, of course, on an operational basis to save costs. I mean, the standard program. If the volumes are not there and your capacity is not really fully utilized, you need to start to work on cost side. We are doing the normal programs. I think what is important is that you see, for example, on the bearing side, even if the relative numbers appear to be high, the absolute figures are not really significant. Here really, despite the economic headwind, we still have a good position with our leading technologies. Overall, and this is also clear, and not talking about the temporary, I assume the headwind will disappear somewhere and somewhen, we are driving two different sector strategies, as I always comment on this. On the defense sector, we are going fully for profitable growth. It's the center of gravity for capital allocation. If you talk about M&A, if you talk about CapEx, if you talk about R&D, on the industry segment, which includes, again, bearings and industry transmissions, we are focusing on profitability and not on growth. If you want to call it on the industry segment, we are in a kind of consolidation mode. The team has clear targets to realize a certain profitability range. All measures are on the table, and this is exactly where we are working on. We hope we can give a little bit more color. We will give a little bit more color on the sector strategy during our Capital Market Day. Sounds good. Thank you. Here in Augsburg. Appreciate it. In Augsburg. Thank you very much. Ladies and gentlemen, thanks for participating in our conference.