Good afternoon, everyone, and welcome to the conference call of financial results of El.En. for the first half of 2023. Today's call will be recorded, and will be therefore an opportunity for questions at the end of the conference call. With me on the call, Andrea Cangioli, El.En.'s CEO, and Enrico Romagnoli, El.En.'s Chief Financial Officer and Investor Relations Manager. Before we begin, please note that there is a remark for management regarding future expectations, plans and prospects, and forward-looking statements. Certain statements in this call, including those addressing the company's beliefs, plans, objectives, estimates, or expectations of possible future results or events, are forward-looking statements. Forward-looking statements involve known or unknown risks, including general economic and business conditions, and the condition of the industry in which the company operates, and may be affected if assumptions turn out to be inaccurate. Consequently, no forward-looking statements can be guaranteed, and actual future results, performance, or achievement may vary materially from those expressed or implied by such forward-looking statements. The company undertakes no obligation about the contents, nor to update the forward-looking statements to reflect events or circumstances that may occur after the date hereof. But at this moment, I want to give the word to Andrea Cangioli. Please, Andrea, go ahead. Andrea, microphone. Andrea, [Foreign language]. Thank you. Thank you, Nicola. Thank you, Bianca. And thank you, everybody, to everybody who is attending this conference call after the release of this six months financials. I'm here with Enrico, and we'll go with a brief overview in generally touching also some number, and then Enrico will go back... will go deeper into the details of the numbers of this first six months of 2023. Beginning with the overall performance, the financial results as a whole continue to be very strong and positive, with consolidated revenues up roughly 6% and consolidated EBIT tracking the record 2022 levels, with a slight delay of 6%. With respect to the guidance we earlier provide, we are in line with the revenues and slightly off with EBIT. As the trend of the first quarter had already highlighted, the second quarter confirmed that in this 2023, our performance is excellent in certain areas, most of our business areas, I'd say, and disappointing in one single business area. To date, I mean, until June 30, 2023, the trend in sales and profitability exceeded the record benchmark of 2022 in the medical sector and in most of the activities of the industrial sector, with the only exception of the sheet metal laser cutting business on the Chinese territory. In terms of revenue, the results of the well-performing areas more than balanced the decrease in revenue of the Chinese areas, leading to the overall 6% revenue growth. In terms of EBIT, the improved performance in several areas could not prevent the consolidated result to mark a slight decrease from 2022. In the medical business, we continued to experience healthy levels of demand in all the market segments. We are observing now a normalization phase. The market environment is slowly returning to the normal standards we were used to live in before the pandemic, after the hype of the post-pandemic phase. The challenges and priorities we are currently facing are not anymore led by the desperate effort to fetch the materials needed to satisfy the buoyant demand that was inflating our order books to record levels, but they are focused again in the definition and execution of the product development and market access strategies, aimed to allow the group to take advantage of the overall positive trend expected in these markets. The markets and the customers need to be stimulated again with intense marketing activities, worldwide on-site visits, trade fairs, and congresses. The size offer of the open orders book is adequate to a good sales performance, but is not implying extended delivery terms as it was during 2022. The broader picture of the expected long-term growth of our markets is the reference for our strategies, investments, and targets. This current phase is also affected by the impact of the uncertainty of the economic trend as an effect of inflation, interest rate increase, and of the unresolved international issues, the war in Ukraine, and the development of the relations between China and the Western countries. The uncertainties stemming from these issues are not helping the capital goods markets, which, dealing with investments usually bearing a return over several years, obviously, are more at ease with a more stable economic environment. I'd like to also add that the research and development investments continue to be strong in order to continue competing through innovation of our product offering, and through an attractive offering for our customers, that due to the ingenuity and to the innovativity of our offer, usually are attracted by our products, also in periods where the economic trend is not generally so strong. Going to industrial business, the laser cutting business continued to perform very well in the Western countries and poorly in China. Cutlite Penta, which manufactures in its facility nearby here in Prato, laser systems for the Italian and the worldwide markets, with the exception of China, experienced once again record revenues, up 30% on the good performance of both the Italian and the international markets. Order bookings were good as expected, increasingly weighted on both international markets and higher power systems, which is good news because it implies higher margins on sales. Therefore, the trend is expected to be positive for the rest of the year, although with a lower growth rate, as the comparison benchmark of 2022 becomes more demanding in the second half of the year. By the way, we are currently attending FABTECH in Chicago, the most important trade fair for the U.S. manufacturing world. I can report a great success of our stand, displaying one of our high-performance laser cutting systems for sheet metal. Decrease in margins on sales is the main problem that we're facing today on the Chinese markets, and the key metric to improve in order to improve the current disappointing results. As we disclosed, our projection for 2023 were counting on a strong rebound of the Chinese market, which had been widely penalized in 2022 by the Zero-COVID approach and the subsequent lockdown strategy, which isolated China from the rest of the world, and also affected the day-to-day and business life, much more in 2022 than it had done in the acute initial phase of early 2020. As it is now clear and well discussed and analyzed, also outside of the technical debates of the financial newspapers, the rebound of the Chinese economy is not taking place, and the economic environment is facing unprecedented headwinds. Also, the support expected by the government policies has been lacking in the six months, or turned to be defensive rather than expansive. The environment is not helping us, but it would be not... It wouldn't be fair to blame only to the economic environment for our poor performance. We are experiencing a fierce competition on the domestic market, which is depleting the already slim sales prices and impacting on the sales margin, and subsequently moving upward the breakeven point, and making harder to reach the leverage effect that, based on the wide capacity investments of the last years and the increased sales volume and amount, had allowed the improvement in the local financial results. The isolation that forced of China, our Italian managers in the technical and sales departments, turned out to have inhibited the cooperation and cross-fertilization processes that had allowed the Italian and Chinese knowledge bases to be effectively shared for the benefit of both parts. The rapid changes in the Chinese markets would have required a rapid and coordinated response that only in recent months, we're now able to define and organize. Of course, the trend in the Chinese performance is also affecting the IPO process, which, barring the current financial results, could not achieve meaningful metrics in terms of cost of capital of the IPO share capital increase. The process is currently still alive and on hold, with the cumbersome compliance procedures to be reinitiated as soon as the results will outline the possibility of a successful IPO. Let me share with you a few figures on the laser cutting business unit in these six months of 2022. Revenues were flat at EUR 126 million, within which China was down from EUR 72 million to EUR 55 million, the latter also including the inorganic addition of KBF, roughly EUR 6 million. The Shenzhen- and KBF is the Shenzhen-based company specializing in laser system for the manufacturing of batteries for electric vehicle, that we purchased at the end of year 2022. EBIT for the cutting division was down in the six months from EUR 6 million to EUR 1.1 million, notwithstanding the excellent performance of the Italian Cutlite Penta. As said, I confirm that we are proactively working on cost reduction, revenue generation, product configuration, and market coverage in order to rapidly revert the negative trend of our Chinese business. Without getting into the details of the numbers, I would like to spend a few words on the restatement of the financial balances of equity and net financial position that we reported in our press release. The point is the share capital increase of Penta Laser Zhejiang, subscribed between October and December 2022 by four Chinese private equity funds. According to the practice adopted by Chinese companies in accounting for capital increases preparatory to IPO and to the guidelines of CSRC, the supervisory authority on Chinese stock markets, the paid-in amounts were booked within equity, notwithstanding the presence of the customer-customary withdrawal option available for the investors in case of failure of the IPO process. We are now acknowledging the prevalence of the IFRS principles and restating within financial debt most of the paid-in amounts, with the exception of the amounts related to one of the investors that executed a waiver of the option clause. Also, the interest that would be acknowledged to the investor in case of withdrawal, 6% per year, has been factored in the restated balance sheet balances and the profit and loss statement. What is important to underline is that this technical, in terms of financial reporting adjustment, has no relation with the poor performance of our Chinese subsidiaries. The restatement further contributes to the depletion of our net financial position, which is one of the topics I wanted to discuss within this call. The period change in the net financial position, anyway, is not affected by the restatement, and it highlights a reduction of the balance by roughly EUR 65 million, equally divided between the first two quarters. Since the second quarter was affected by the payment of dividends, EUR 18 million in total, the performance of current operations significantly improved from the first quarter, but it's still cash negative and needs to be reverted, or better, it is expected to be reverted in the next quarters. The main cash absorber was net working capital, with a strong increase over the six months. Within the components of net working capitals, the rolling out of the trade receivable components was physiologic, with the balance increasing by less than 5%, in line with the increase in the sales volume, and therefore, without a notable change in the days of sales outstanding metric. The main contributors to the increase were inventories and trade payables. The former increasing by EUR 23 million, and the latter decreasing by EUR 24 million. The grounds and roots for this trend are to be identified back in 2022, with the booming demand and the desperate struggle to timely source materials in order to allow decent delivery. There's somebody talking. Sorry, excuse me. Excuse me. Can you switch off the microphone? Thanks. The grounds and roots for this trend are to be identified back in 2022 with the booming demand and the desperate struggle to timely source materials in order to allow decent delivery terms to customers, and also in the proportionally wide parts, purchasing planned support of the expected 2023 sales expansion. In 2022, we deliberately increased the current purchase volume, the purchase volume commitments, and we reduced the average payment terms to vendors in order to gain a competitive advantage on a market where the ability to timely deliver was constituting an exception. In the first months of 2023, we confirmed this strategy. Now that the supply chain's constraints are being removed and lead time seem to return to normality, we are returning to the normal purchasing standards. In the meantime, we had a progressive increase of inventories, including a progressive increase of what we could define safety inventory. Upon expiration of the payment terms, vendors were paid, while also due to the normalization of the market cycle, it will take some time to liquidate this so-called safety inventory. It is important that you know that to our best and current knowledge, there is no higher obsolescence risk in this safety stock, but in certain cases, it might take a while to be used due to fluctuations from the expected demand for specific product lines, but that will be eventually absorbed in the production processes cost of goods sold. Concerning inventory, we're also registering an increase at the end of June in finished products, in finished goods, anticipating manufacturing of certain long-term planned customer orders in order to optimize our production capacity management throughout the year. Moreover, apart from the three main components of net working capitals, trade receivables, inventory, and trade payables, a significant role in cash absorption was played by deposits from customers and to suppliers, which jointly recorded a cash absorption of EUR 10 million in the six months, mainly reflecting the reduced amount of the order books in China and of the order books in Italy, concerning the order books bearing down payments, which means the order books related to the so-called 4.0 tax cuts. I am done with my general introduction. Please, Enrico, you can go ahead with your report. Okay. Thank you, Andrea. As usual, I'm going to give you some detail on our last financials. As you can see in this slide, the revenue increase of 5.7% at EUR 345.6 million, with an increase higher in the medical sector, 8.5%, than the industrial sector, 2%. The gross margin amounted to EUR 131.5 million, up by 8% compared to the EUR 121.8 million of first half of 2022. Sales margin recorded a slight improvement in the medical sector, above all, due to a better mix of products sold, but also thanks to price increase that mitigated the inflation effects on costs. On the other hand, the margin of the sales in the industrial sector suffered a decline, above all, to the difficulties on the China market, already mentioned by Andrea. More competitive by the 2022 crisis, from which it is struggling to emerge. Operating expenses increase, increased on the impact on sales from 8.5% - 8.9%. The main reasons are the sales and marketing expenses for trade fairs and congress, encouraged by both medical and industrial companies. Staff cost increased of EUR 8.2 million, but with a slight increase as impact on sales. The cost for stock option and share-based payment to employees, contribute to the cost increase. In the 2023, this amount was, EUR 1.6 million, compared to the EUR 0.5 million in the first half of 2022. At the end of June, there was over 2,200 group employees, and the most part, 91 units, derives from the employees, from the employees of the new acquired KBF company, acquired at the end of the year, in Shenzhen. When the other new hires mainly concern Asclepion in Germany, a company that grew 29% in the first half, and Quanta System, the company grew 20% in the first half of 2023. EBITDA was equal to EUR 45.7 million, down 3.3%, on the EUR 47.2 million as June last year, and EBITDA margin was equal to 13.2%, down from the 14.4, as for, the 2022. Depreciation and other accruals increased due to the investments made in the past years, and for bad debt reserve, while it reduced for warranty expenses, mainly due to the slowdown of turnover in China. The overall impact on sales is more or less stable. EBIT showed a positive balance of EUR 38.9 million in the first half, down from the EUR 41.4 million of 2022, with an impact on turnover decreasing from 12.7% - 11.2%. It should be remembered that the 2023 EBIT is impacted by higher notional costs for stock options and share-based payments, as already said before, assigned to employees, directors, and collaborators of EUR 1.2 million, compared to the 2022. Pre-tax income, affected by negative Forex, mainly on U.S. dollar, and by interest expenses calculated on the fair value liability introduced in Penta Laser Zhejiang at the end of 2022, showed a positive balance of EUR 37.8 million, down from the EUR 41.6 million. Net income was EUR 25.7 million, down from the EUR 28.4 million of last year. In terms of balance sheet, this balance sheet, as you can see in the column of 2022, showed already the number restated. And we can see in this slide, the impact of the restatement that affected the net financial position, and with the same amount, the total net equity for EUR 15.2 million, without any change in terms of net capital employed. We can see that the main reduction in the net financial position is in the net financial position that move from the EUR 75 million at the beginning of the year to the EUR 10 million at the end of June 2023. In terms of cash flow, the phases of significant absorption of working capital, as mentioned by Andrea, by the group operating activities, continues, but marks a slowdown in the second quarter, which should herald the reversal expected for the second half of the year. The increase in working capital, in capital, absorbed cash for EUR 59 million in the half year, of which EUR 26 million in the first quarter, while the change in advance to customer, supplier, tax payable, and tax credit absorbed another EUR 50 million in the six month. Fixed investment amounted to EUR 8.5 million, down compared to the previous year, according to the forecast. The payment of dividend for EUR 18.9 million is an annual payment, which impacts the second quarter only. The significant contribution of current profitability flows, EUR 27.8 million in the half year, was able to limit the cash absorption determined by the items just commented on. The maintenance of good current profitability, the reversal of the trend in the expansion of working capital, and the absence of dividends to be paid, should allow a clear improvement in the net financial position at the end of financial year. Looking to the breakdown by business, the medical sector was 57% of the total sales, when the industrial was 43% at the end of June. The excellent result in sales of system for surgical application stands out, approaching 30% growth, in line with forecast and with the progressive recovery after the slowdown in the COVID period. Therapy and aesthetics are also growing in the residual, and other segment is expanding very rapidly, thanks, above all, to a return of interest in dentistry systems. The turnover for after-sales service and consumable marks a higher growth than the turnover for systems, thanks to the increase in the installed base, which physiologically entails a greater volume of technical assistance on the system and use of consumable, especially in urology, where every intervention require an optical fiber. Turnover growth in industrial sector is around 2%, and after years of progressive and rapid growth, which led it to constitute almost 85% of the sales in the industrial sector, the cutting sector is maintaining its turnover constant in the first half of 2023. This stability actually arise from two, profoundly different result, still brilliant, and growing very rapidly with Cutlite Penta in the Western market, Italy and Europe and the United States, and slowing down on China's territory, which represent approximately half of the group sales in the sector, and where there was a decrease in turnover in order of 20%. Laser marking continues to be sustained, exceeding 33% in increase in the first half, thanks to the excellent performance of both LASIT in marking for identification and OT-LAS for decoration and special processing with CO2 laser sources. Turnover in industrial sources is essentially stable, while the reduction in revenue for after-sales service and consumables is mostly due to the slowdown of the market in China. In terms of breakdown by area, the sales trend by macro geographical area for the two sectors highlight the best overall performance for the medical sector, especially in foreign markets, while in the industrial sector, the excellent sales performance in Italy and in Europe contrast with the slowdown in the rest of the world, due to the lower sales recorded in the cutting sector by Chinese company. Andrea, if you want to, you can comment the guidance for the year. Andrea, your microphone. Yes, yes, it's open now. Okay. Concerning the 2023 guidance, with all the prudence always needed due to the complex environment in which we operate, particularly today with respect to the Chinese market, we confirm for the full year 2023, the forecast of a slight increase in consolidated revenues compared to 2022. For what concerns EBIT, we are counting for the end of the year to maintain the same percentage gap or delay from the 2022 balances. We are now done with our prepared comments, and we are ready to answer your questions, if any. Andrea, we have some questions. The first one is from Giovanni Selvetti from Berenberg. Go on, Giovanni. Hi, everyone. Ciao, everyone, and thanks for taking my question. Hi, Giovanni. So the first question relates to the aesthetic division, really. So, EUR 114 million on the semester imply Q2 sales equal to EUR 58 million, which is a contraction of roughly 1.5%-2% year-on-year. Now, given the bullishness of some of your competitor in aesthetics, I was wondering whether you think that... I know that 2022 was exceptionally strong, but, if, if there's something that you see there, if you feel like you're losing a bit market share, or do you—how do you interpret the slowdown in Q2? And most importantly, if we can expect the same growth rate for the aesthetic division in the second half of the year. The second question is, of course, on China. I know it's difficult to have an idea about how the situation in China will evolve, and I know that it's not up to you. But I was wondering what are the action you are taking to stop the bleeding, really, going forward. So I'm not sure if I get it right, but I think that Enrico now was mentioning additional hirings in China. I was more thinking to ask whether it's reasonable to expect some firing or some cost-cutting if the top line does not improve. And, you know, as a final question on China, whether it's possible to quantify what is roughly the loss at the consolidated level that China is bringing. And the third one is on the net financial position, the debt. So apart from their statement of the capital increase of the Chinese private equities, there seems to be lately a constant working capital absorption. And while I kind of get it, you know, when you have supply chains that you kind of supplier maybe earlier or in advance, now that the situation is normalized, I was, you know, trying to understand how to interpret this, and if maybe there is a kind of more generous approach with clients in terms of receivable to present... to preserve, sorry, the top-line growth? ... Okay, thank you for the three questions. Yes, you are right. The aesthetic division marked a slight decrease in revenue in the second quarter compared to the second quarter of 2022. This is mainly due to one account, which decreased its volume markedly, and it's this account is related to sales of hair removal devices. Generally speaking, the trend of aesthetic continues to be strong. It will continue to be smoother, let's say lighter than last year, due to this single account. We do not have in the rest of the world particular problems. We have encountered more problems than in the past, especially in the Middle Eastern countries, where certain countries are struggling more than in the past to find currency to pay us, even though the demand would have been more solid. So in a nutshell, the trend that we forecast for the second half is more or less in line with the first half. If we will be some point over or some point down with 2022 will depend to specific trends. We are missing one very significant account here. For what comes- So sorry, sorry on this, but what kind of weight should we talk about? Like, it's like a big account? Big- Yes, it's an account which weighs for a few percentage points. For sure, we are not seeing a double-digit growth. I mean, net of this account, we wouldn't have seen a double-digit growth, because we had a lot this the loss on this account and a smoother behavior of the Middle Eastern country and somehow also the of the U.S. countries. This will continue, and I mean, the trend will be around the parity with 2022 in the second half. As I was mentioned during my presentation, as opposed to the situation of 2022, where we had huge order books, now orders are coming in a more regular way, but without piling up in huge order backlogs. Therefore, we have less visibility than we had in 2022. Nevertheless, we are extremely optimistic because, also due to the launch of new product, we have stimulated the market, and we have seen good results in terms of order acquisition, which, I mean, are very promising for the end of the year. Actions in China. As I mentioned, there are various actions that are taking place. When Enrico said that the number of employees increased, this is a technical increase. We acquired a company, and we acquired a company with 80 employees on December 31st, and therefore, if you compare June 30 with December 31st, this company is just added in. Doesn't mean that we hired new people in the other companies that are there, they are struggling. KBF, working on the electrical batteries for the batteries for electrical vehicles, is doing decently according to the plan. While who is struggling is the sheet metal business, where we didn't hire and where we started also, let's say, a review, which could end, which is going to end up with some also headcount reduction. But note, the problem that I highlighted is that we have a margin reduction. It means that we are manufacturing more or less the same volume of last year. So in terms of production, we didn't manufacture less laser systems. We simply had to bear lower prices on those laser systems. Part of the lower price is absorbed by the reduction in cost, but not in full, and this ends up in the reduction of margin. So the design and the sales network reorganization is one of the main topic in our organizational work. We are working in order to have the export part. You know, export from China is dedicated to the neighboring country and in minor part to the Western countries, but also this export part had great problems in its management during the lockdown, and so now we are reinstating the distribution network. For instance, in India, for instance, in Thailand and in Korea, that couldn't be followed with the attention that would have required during the year of the lockdown. We are also, since the... Even if the volumes are staying more or less flat, they are not growing. We also have due to the modernization of our production capacities and our ability- Say, through me, in my territory? Excuse me. Due to a better organization or production facilities, we could also reduce the number of plants that we use, therefore reducing the cost. So these are the main actions that we are taking. Concerning the financial result of the period of the Chinese business, just to say, in terms of EBIT, the loss. Just a second. Let me go and check it in the numbers. Was about EUR 4 million. So it. And differentially since last year, they were making money, it has been a great impact. Of course, you have to consider that I believe roughly EUR 1 million is non-monetary cost for assignment of stock to employees, so stock-based compensation, which is, of course, real for IFRS accounting purpose, but it's not an effective cost. About net financial position, yes, you're right. You're exactly right. The world is now changing. We do not have the hassle and the long lead times anymore, but we are. This is today, and this is starting to change in the first months of 2023. What we are now making comments about is the first six months of 2023, and as I mentioned, the trend has been defined by the actions taken in 2022 and in early 2023. Today, I see exactly what you say. We are reducing purchases because we have in-house the materials. We are also trying to get back to more normal payment terms with vendors, and we are positive. We see it that these actions will lead to an increase in the net financial position and a decrease of cash absorbed from by the increase of net working capital. Concerning your suggestion to be a little bit more generous with customers in order to improve the sales volume, so in terms of payment terms with customers, I am fully with it. We need to find a balance because there's a... there's also a risk involved. There's not only a financial variable. We do not have, in several cases, counterparts which are extremely solid financially. We are not necessarily able to access to protection in terms of letters of credit or warranties that are provided by supranational bodies or national bodies like we have in Italy. In Italy, we have a government entity called the SACE, which is able to protect our receivables in certain countries. So if I give more room to our customer, it's I need to make sure that he will be able to pay. So it's something that we're taking into consideration, but we do not want to expand the receivables because we do not want to increase the bad debt in the following years. I hope I have answered to your- Yeah, no, no, it's clear. It's clear. So you don't see, like, an increase in the accruals for, you know, maybe trade receivables, like write-off or anything like this? We don't have this problem now. We have more of a problem. What has changed in the world is this, that in June 2022 we had finished goods inventory zero, because as soon as something touched delivery area, somebody was ready to pay for it and receive it. Now, people are not willing anymore to pay in order to have the materials that way, and it's becomes more of a struggle to get the payments in order to deliver the scheduled program. So it's what had characterized our way of working until 2019, and as I mentioned before, we have a sort of normalization. So things are going well, but the hype that has been generated in the past in the post-COVID couple of years is now normalizing to a good sales trend, but to a normal relation with customers. And the normal relation with customers in our world includes that the customers wait until the very last moment before he pays for his deliveries. Okay. Thank you, Andrea. I don't want to steal too much time from the others. Thank you very much. You're welcome. Andrea, for the second question, we have Marco Ercole from Banca Ifigest. Go on, Marco, please. Yeah. Thank you, Bianca, and good afternoon to everybody. My first question is about if you could provide us with EBITDA margin on sales for the division, for the segment of, for the medical segment and for the industrial segment, if it is possible. And the second question is about the discount policies, because I remember from the last meeting that you told us that you just didn't increase the prices, but you stopped the discount policies on your customers. So I would like to know if you start to resume some discount policies on customer in order to increase the revenue and the volumes. And my last question is about the backlog. You already told us that you see less visibility on the year, but is it possible to know more about the backlog for the end of the year? And, I mean, do you have any forecasts about that? And would it be possible to have some numbers? Thank you. Okay. Concerning segment EBITDA, we never disclose the numbers. And it's information that has never been available. We might make it available in the future. Generally speaking, as we have an overall 13.2% EBITDA margin, you have to consider that EBIT margin is much higher. EBITDA margin is much higher in the medical field than in the industrial field. We usually report in terms of EBIT, where, I mean, we have a total, excuse me, 11.2% EBIT margin. Consider that the EBIT margin in the medical is south of 20%, while in this year, in which they performed, we performed poorly in industrial margin, the EBIT margin of the industrial is south of 2%, in terms of order of magnitude and in terms of proportion. As a standard operating level, what I told you about medical is what we currently operate, while the EBIT margin that I just mentioned below 2% is something which is affected deeply by the very poor performance of the Chinese facility. A more normal EBIT margin for that division would be, let's say, south of 10%. We never reached 10% in that particular business, but we never gave a report, a detailed reporting, and we just gave rough numbers. Concerning price increase related to volume increase, and discounts, yes, you remember well. The point was that in the medical business, we where prices are usually stable over the time, we introduced price increases in at the end of 2022 in several product lines. Those price increases were partially taken, partially not. Of course, one thing is to apply a price increase in a very, very brilliant and buoyant market situation like we had for all 2022. Quite different is doing it today, where the situation is still good, but it's normalizing. So I would say that the 10% price increase eventually impacted probably 30% of our sales. In industrial, the situation is different because due to the rapid reduction in the cost of goods sold of most of production, the price level trend has been decreasing over time. So in that area, rather than applying price increases, we stopped the price level, and we stopped applying discounts, and more than discounts, reducing price list year-over-year. But in the industrial business, we have, concerning price level, we have two trends which are defining how the business is developing under this point of view. In the Western world, the production of catalytic paint is shifting towards a higher average of number of kilowatts sold for each system, which makes the system more expensive, and so the price increases. Also, we're expanding the number of systems sold to international market, where also the prices are usually higher than Italy, where the market is very competitive. So we had also in this case an increase in prices due to the mix, notwithstanding the fact that for each price level, for each product, the price stays stable. Finally, you asked what we have in hand in terms of order books for the end of the year. We never disclose the entity of the order books. In the past years, we mentioned that the visibility of our order books was typically 60 days. In 2022, we reported that the order books was growing to a dimension, to an unprecedented dimension. And we, I believe at certain points, had order books, which were covering, depending on the market segments, four to six months. Now, especially in medical, we are returning to the more normal 60-90 days coverage of orders. For this reason, the forecast that we made, and for the end of the year, which underlies the guidance, which says that we will slightly increase the overall sales volume in 2023 compared to 2022, is supported to the current order books. We do not disclose and never disclose any specific figure on our order books. I'm sorry. Thank you. Thank you very much, Andrea. Andrea, next question comes from Benjamin Rousseau from Edmond de Rothschild. Go on, Benjamin, try for your microphone. Hello. Can you hear me? Yes. Yes, perfectly. Yeah. Perfect. Thank you for taking my questions. Three questions from my side. First question on the laser cutting business and the profitability of this sub-segment. If I understood well, you said earlier that EBIT decreased from EUR 6 million to - EUR 1.1 million in H1, if I understood well. But you also mentioned the loss of EBIT of EUR 4 million during this Q&A. So sorry, I was a little bit lost. So if you could just repeat again the impact on the weak China's laser cutting business on EBIT, I would appreciate. And also the reason behind this margin drop. It's only the pricing pressure that you have mentioned, which explains this margin drop? Or were there also some, I don't know, initial recruitments and capacity investments in China, which led to, another assumption of, of OpEx? And, and what about the, the other markets, Italy, America, the, in the industrial, sector? They, they were not able to compensate a little bit, I mean, the, the weak, China. Second impact on the currency impact, in H1 2023, if you could, let's say, give us, I mean, a, a rough figure of the, the currency impact on, on EBIT margin. Because I, I have in mind that last year, in 2022, there was a very favorable, FX, impact on, on profitability. And third question, what's your view on H2 for the industrial sector overall? So it was -5% in Q2, after +12% or 13% in Q1. So should we expect a further strong deterioration in Q3, or let's say -5% to -10% is a good assumption at this stage for H2 in the industrial sector? Thank you. Okay. In the cutting, I'm sorry, my exposition wasn't clear. I'm really sorry for that. The EBIT of the cutting division for the first six months was positive for roughly EUR 1.1 million, decreasing from the last year EBIT. EUR 1.1 million, roughly speaking, is a net result of +EUR 5 million, -EUR 4 million. +EUR 5 million, Italy and Brazil, -EUR 4 million, China. So, it's actually... What happened is actually what you said, that the excellent performance of countries like India balanced the losses in China. And the results was nevertheless positive. But of course, would have been much better and if China would have performed decently. Concerning the poor performance in China, yes, I confirm, there is no extraordinary expense for the exception of the EUR 1 million in stock-based compensation, which, it is not extraordinary, but simply, it would need to be adjusted in a pro forma financial report, not taking into account the IFRS adjustment. But the main issue is that for stable volumes of sales in terms of number of products sold, there is a decrease in average price and a decrease in the margin, due to the inability to reduce our cost of goods sold proportionally to the reduction in the prices. So this is the main problem. This is where we have to work, and we're working. We're working on the reduction of OpEx, but all mainly in the improvement of margin of sales, by identifying richer markets and by trying to better streamline our production process and reduce cost of goods sold. Currency, you will have a good memory, it was a significant impact in 2022 because the dollar, the U.S. dollar, suddenly increased in its value. This is not taking place in 2023. In the first six months, most of the currencies are basically flat. There is no impact on margins. There's only one significant shift in the currencies, which is an increase in the average exchange rate of the first six months of 2023 compared to the exchange rate of the first six months of 2022, is the Chinese renminbi. There's a 5.7 big increase in this case, but this is not affecting margin because, concerning the renminbi, it's mainly a translation effect. Since all the cost of the sales in renminbi are mainly in renminbi as well. About your last question, what are we expecting for the from the industrial business in the last quarter, since we marked in the overall industrial business a decrease in sales in the second quarter? I believe that, in the industrial business, we will not achieve the very sharp overall increase that we're expecting because China is underperforming. But also, we are gonna face a lighter benchmark with China in the second half, because the poor performance of China initiated from Q3 2022. Therefore, I believe that we, depending on the performance of China, we will see either a small increase or a small decrease, but we are not now in the position of determining a number. Overall, I believe that we will end up the year close to a flat performance in term of revenue, or with a small increase in line with the overall guidance. I would like also to mention, under this point of view, that cutting business is not the only business that we have in our industrial business, though it's worth roughly 80% or 75%, I believe, in the first half of 2023. We expect a very strong performance from the marking business and also from the laser source business. Those are smaller market, which account, I believe, in total to something like EUR 40 million in revenue over the year. But we believe that in that market, in these divisions, the sales amount will increase with good results in 2023 with respect to what we were able to do in 2022. Many thanks. Andrea, one more question from Andrea Randone of, from Intermonte. Go on, Andrea, please. Thank you, and good afternoon. My question is about new products. I mean, this year, you already mentioned that the pipeline was a bit weaker in the first half, but maybe stronger in the second half. And so after a general comment, I wonder if you can spend some words about the acne solutions, what, what, what are your procedures going on, going on in the U.S.? And the last point, always on new products, I mean, your results in the urology are very good. I mean, anything new also in this, in this segment? Usually it was very profitable segment. Again, if you can spend a few words on it, thanks. Thank you, Andrea. You give me the opportunity to mention something about new products, which in this presentation, which is more financially oriented, hadn't found an adequate space. New products are our life, are the base of our product development. We have significant new products in the pipeline. You remember well, 2022, together with the purchases of goods which increased our inventory, was also characterized by the need to redesign, to an extent, to redesign several products. And we had R&D and engineering absorbed by redesigning rather than designing new products, but it was swim or sink. If we couldn't redesign certain part of the products, we wouldn't have been able to deliver. Now we are back to the usual brilliant productivity of our R&D departments. We mentioned, and I mentioned already in other presentation, the launch of the PRO platforms, the PRO platforms, that were launched at the World Dermatology Congress in Singapore in July. Those platforms are improvements of the Again, which is our flagship platform for hair removal, of the Onda, our flagship platform in body shaping, and of Red Touch, our flagship platform in the treatment of pigmented lesions and in the tightening of the skin. Those incremental improvements, jointly with ergonomic and improvements on the system, are changed, radically changed those systems, and also already brought a wave of new purchase orders on these new devices. We have, very important, also new products dedicated for the U.S. market. Today, we have a very important customers of ours visiting our production site, and we will have a new body shaping device based on a new technology, which will be launched on the market as soon as we receive the clearance for selling in the United States. It should be something that should fall within the end of the year. And this product, which is called PHYSIQ 360, is really could be a game changer in the market. Finally, still talking of aesthetic, we are closely talking with the large account, which was missing when I was answering to Mr. Giovanni Selvetti's question before, in order to redefine the product, and to have a new wave of orders in 2024. I would like to say that we feel extremely strong and extremely confident in our ability to have a very strong pipeline and to attract customers with new product. Acne. Acne is a long-term project. We have, for the first time in the six months, an amount larger than zero in the sales of Accure system. It's something very small because we are talking of the preliminary launch which is currently being performed by our U.S. company, Accure, Accure Acne. But we are seeing after several years, finally, something move. Finally, something move. The company, Accure, got funded in order to start with its initial product launch. This is what we are supporting, and we are confident that the sales volumes will maintain low, but constant over the next six months. Upon success of the clinical results in terms of market results of the first unit installed to work on the market, because I need to recall that up to today, up to now, we were basically working with luminaries only. So we didn't have the system working on the market. Upon the expected positive results, Accure Acne should be able to finally start its launch program, which should take place in 2024. But it's too early now to define if and how large would be the volume that they will be absorbing in 2024. About urology, you're right, we did extremely well. We do not have new breakthrough products, but we are redesigning products in order to improve also our penetration in the market also through our OEM partners. We enlarged the number of OEM partners which rely on Quanta System for the stone devices and also for the BPH devices. We have a long-term project in the pipeline. It's a complex project. We have been talking with you, with investors, over a long time about this new short-pulse laser, which should improve the performances of the current reference product, which is the fiber laser, the fiber laser product. But this won't be available on the short term on the market. Nevertheless, we are quite optimistic on how the market are gonna develop in the next months. I think I answered your question. Yes, indeed. Thank you. Andrea, the next question comes from Emmanuel de Figueiredo from LBV. Go on, Emmanuel. Emmanuel? Are you still there? No. Okay, we give the floor to Andrea Bonfà. Andrea from Banca Akros. Andrea, go on, please. Hello, good afternoon to everybody. Ciao, Andrea. My question is, the first one is related to your potential cash generation in H2. I mean, you mentioned that you are aiming to recover part of the excess stock, or if it's possible to quantify this number, because in the first half you absorb almost EUR 60 million in the net working capital. And the second one is on the same subject. I mean, in a scenario where your sales, like, growth is, let's say, slowing down, do you expect to become more of a cash generating machine, or do you expect still that your working capital keeps absorbing and not allowing you to properly generate cash? That's a more long-term question. And the other one are related to the industrial laser. If you can elaborate how it's performing in Brazil and the U.S., in particular, when U.S. will become visible in the laser, in the industrial laser business. And if I may, looking at your Q2 2023 figures, it seems that both Italy and the rest of Europe have slowed down quite materially. If you can elaborate on those two market aggregate for the H2 2023. Thank you. Andrea, microphone. Andrea, microphone. You asked what is expected to decrease? The general economy, a specific market segment? I couldn't hear. I lost part of your question, but if I understood correctly, I was referring to the fact in a scenario where your sales growth rates are slowing down, so they are not anymore like they used to be in the recent past. If you are becoming a cash generating machine, because, I mean, in the past, the growth absorbed from a net working capital standpoint. So I'm wondering if in a more stable scenario, you should become a cash generating machine. So I want to know your standpoint on that. Okay, so let me start from the first question. How much are we planning to recover? Difficult to say, because it depends on various items. We have excess stock, this is obvious. Most of this excess stock is paid for already, so when we will sell it, this will transform us in a very good cash generator, because we would sell something we have already paid for. But there are two uncertainties. One is the extent of the demand, so how much we will sell, more or less we know. But most important is what we will sell for each product, because what is harming us is our, a huge variety of products, which is a great competitive advantage, but which is also a, a high stock inventory generator, since you have to program large volumes, to have safety stock for each of the product lines. So if the excess stock for each of the product line will, will be uniformly, released, it is quite, quite, logical that we should be able to release about EUR 20 million of inventory within here or, and the end of the year. I don't think this will take place. I don't think this will take place, because we will be able to release in full certain lines, but some of the lines will remain there, and in the meantime, we will be purchasing more materials for other product lines. Of course, if you look our financials in the first six months, we are not a cash generator, but now that we paid for all this material, I believe, since we are not going to increase the volume so much, and we will not have the need to over-purchase, as we were forced to do due to the contingency of 2022, we will believe we will return to be a good cash generator, as we have been in the past. The... I cannot give you the exact number, but I can confirm that the trend is the right trend. Was there another question? Yeah, Brazil and U.S. Ah, yeah. ... industrial laser and Europe and Italy, industrial laser. Hello. Brazil, I can tell you the exact figures of Brazil. Just a second. They did... In Brazil, Laura, just a second. I don't... So I need to find it in- In Brazil, we have Q2 with an increase in sales of 5%, and in the six months, we have an increase of 2% in sales.... yes. So in Brazil, the sales are slightly increasing, but not so much. The main increase were in Italy and the, and in the other countries. Also in the U.S., the number is increasing rapidly. It's not worthwhile mentioning it. We have great expectation for the U.S. going forward, and we will probably disclose the numbers going forward, because as I was mentioning to you before, it's the second time we have attended the trade fair, and we are encountering a huge success at this trade fair. Since we have already in place the initial skeleton of an effective distribution network in the United States, we plan to see good results in the sales on the U.S. market already from 2023, and increasing further in 2024. Concerning the sales in Italy and Europe, we are planning to see a wider increase in Europe, and a more stable trend in Italy, due to the fact that the incentives for the 4.0 are still present, but are not as compelling as they were before, and therefore, the demand in Italy will not at the very end the performance of 2022 in 2023. Thank you, Andrea. You're welcome. Andrea, we have not any other question in our list. I kindly want to ask to the floor if there are some other question. I've seen Emmanuel. Emmanuel, are you there? Emmanuel? No. No. No, no, he left the... The- Emmanuel? No. Okay, he left the- It looks like he left the conference. Do we have some other question from the floor? No. Then, if there are no more question, we finish this conference, and if you have some more question to investigate, please do not hesitate to contact Enrico Romagnoli. He will be happy to answer your question. Thank you for attending this conference, and we hope to have you all again next time. Good afternoon to everybody. Bye. Bye-bye. Bye-bye. Thank you. Bye-bye. Bye-bye. Bye-bye. Bye.