Good afternoon or good morning to everyone, and welcome to El.En. first Q1 2024 financial results conference call. Today's call will be recorded, and so there will be an opportunity for questions at the end of the conference call. With me on the call, Andrea Cangioli, El.En. CEO, and Enrico Romagnoli, El.En. Chief Financial Officer and Investor Relations. Before we begin, please note that there are remarks that management makes on the conference call about 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 conditions in the industry we operate, and may be affected should our assumptions turn out to be inaccurate. Consequently, no forward-looking statement can be guaranteed, and actual future results, performance, or achievements may vary materially from those expressed or implied by such forward-looking statements. The company undertakes no obligation about the content, nor to update the forward-looking statement to reflect events or circumstances that may arise after the date thereof. If you needed to ask a question, please book your question on the chat of Bianca Fersini Mastelloni. I will be pleased to introduce you following the booking order, but at this time, I want to give the floor to Andrea Cangioli. Please, go ahead, Andrea. Thank you, Bianca. Good morning, everybody. Thank you for joining us in this earnings call after the release of the Q1 2024 financials. Enrico Romagnoli is on the call with me, and will, as usual, provide the details on the financial reporting. The financial results released yesterday for the Q1 of 2024 are in line with the expectations, reflecting the trend that starting from the demand peak of mid-2022, slowly normalized, progressively losing momentum during 2023. Consolidated revenues were roughly EUR 149 million, down 7% on 2023. EBIT was EUR 14.3 million, down 15.7% on 2023, and equal to 9.6% on revenues. The essential summary is that in the quarter, we experienced softer sales volume in both industrial and medical markets, that sales mix changes provided for increased gross margin, and that increased expense in absolute terms for sales and marketing, and in relevant terms, as an effect of reduced leverage, led to a decrease in EBIT margin and EBIT. Enrico will provide you soon the details of certain non-recurrent entries, which improved gross margin and increased expense and accruals. In fact, at the EBIT level, there's a wash between one-time revenue and one-time expenses. As you might remember, we were up to a brilliant start in 2023, and then experienced progressive slowdown in the subsequent quarters. The expectation for 2023, excuse me, for 2024, included in our delivered yearly guidance, were, and still are, to recover the initially slower start with a progressive improvement over 2024. Before giving you some more color and details on the trend of our main market areas, I'd like to make a few remarks about the general economic environment in which we're working today. It wouldn't be fair to state that we're facing adverse market conditions, but it's evident that certain events and situation that have been casting a shadow on the brightness of the economic trend are proving to be much more persistent than we were expecting. I'm talking at first place of the interest rates level. It was given for granted that rates were going to be cut in the U.S. and Europe, but the event that investors are waiting in order to see a reduction in their lending costs is being procrastinated over and over. And in second place, the wars, the Ukrainian one, still very uncertain in its results, and the subsequent effects on the relations between the involved parties and their allies, of which we are really not part, and the same for the Middle East war, which is impacting on an area which is very important as well for our medical business. And of course, since for the market of capital equipment, high confidence in the future and low interest rates are helping a lot the investment decisions, we are not experiencing a phase where the general trend is encouraging investments. This said, in general terms, let's see the various businesses that operate with sensibly different market drivers, and therefore, market conditions. In laser cutting, the international markets continue to offer interesting sales opportunities for our products, while our two domestic markets, Italy and China, are struggling. We experienced a quarter which was flat in sales in China, where structural cost reduction allowed us to improve the bottom line, sharply decreasing in revenue and earnings on the Italian market. Finally, rapidly expanding on the international markets, where our offer can experience a softer competitive pressure, and therefore achieve higher sales margin levels. In Italy, we are suffering the awkward situation of the fiscal policies set forth by our government in support of investments in technologies. We knew that the so-called Industry 4.0 tax cuts were expiring after the reduction in 2023, and we were expecting a subsequent slowdown in sales, but we could not expect that the next fiscal support package was going to be announced, promised, but not put in place, or better, put in place without the needed information on scope, amounts, and eligibility procedures. In the short terms, this is constituting an additional reason for procrastinating investment decisions, waiting for the clear definition of the policy. Good news in this different geographic sales mix is that margin on sales improved. I'm still talking of laser cutting business. Net of the effects of the flood damages reimbursement proceeds, of which you will see the detail within the report, that improved the division's gross margin by 2.8 percentage points. Laser cutting division's gross margin on sales was up 3 points, from 21.1% to 24.1% compared to Q1 2023. The laser marking business for identification and traceability is continuing to undergo a very positive phase due to the general market demand, but I would also like to say, mostly for the very consistent approach selected by LASIT, our company in charge of this segment, to approach the market. The project of internationalizing the distribution is paying its dividends, exploiting the strategic goal of being closer to the customers in order to be able to identify their specific needs, and take advantage of the very structured and flexible facility of Torre Annunziata to provide them with the most effective customized solutions. LASIT and its subsidiaries were up 17% in revenue in the quarter, and are being accretive to consolidated margins on sales and margins as well. To complete the picture on the industrial sector, a few words about the current status of our Chinese activities. Financial results have been poor in 2023, and are improving in this early 2024, still with a red bottom line, but with the expectation to meet break-even in the next quarters as the effect of reduced fixed cost basis, and the progressive increase of higher margin bearing international revenue. ... Excuse me. Sorry, can you please, The IPO we had for a long time worked for is currently suspended, pending the return of more favorable circumstances. The financial results currently do not meet the standards, both under a Chinese regulatory and business perspective, to file a successful IPO. The private equity funds that had invested in Pentalaser, the mother company of the laser cutting division, with the aim of accompanying the company to the IPO, are exercising the withdrawal option reserved for them within the capital increase agreements. Negotiations are underway with the current private equity investors, and with other investors potentially able to replace them in supporting the company's ambitions. Turning to our medical business, overall revenue was down 5%, mainly due to a soft performance on the aesthetic market, in turn, mainly due to the soft performance of the hair removal business. In other aesthetic segments, like toning with Q-switched and picosecond lasers, mini ablative anti-aging, the sales volume was in line with last year. Most of the sales decline in hair removal is attributable to a weak demand from the United States. Two more comments about this trend: The first is that overall gross margin improved, since hair removal is the most competitive and lowest margin-bearing application in the segment. The second relates to our offer in the segment and to product range expansion and renewal, which is our main competitive weapon. This period has been fruitful for product launches, the most significant being the completion of the Pro Line of the DEKA systems for medical aesthetics. The Pro Line provide us to our customers a palette of systems based on various technologies, which improve performances and usability for body shaping, anti-aging, and hair removal. More products have been specifically designed for the US customers, and already bear the FDA clearance. I'm talking of improved performance hair removal devices, and a new revolutionary body contouring system. All these new systems are undergoing their initial phase in production, following or correspondently to their commercial launch. We have a very interesting backlog that will support the sales in the next months, as soon as production volume for these models ramps up. Surgical laser sales once again beat the corresponding quarter of the previous year, driven especially by sales in urology. In this segment as well, a new product launch took place in the quarter, with Quanta System announcing at the European Association of Urology Congress, the launch of the Cyber Ho Magneto, which will enable the most effective power delivery in the stone management devices. The closing comment about sales is related to a trend which is common to both industrial and medical sectors. The increase of what we call service sales, which includes all post-system sale revenues. We're talking of technical maintenance service, either built on a time and material basis or on a service contract basis, and the sales of consumables, where the system usage calls for mainly optical fibers for urological surgery, but also lamps and refurbishing for hair removal devices, and laser mix gas bottles for the semi-sealed CO2 laser sources for industrial applications. It is also notable that service revenues increased much more in the industrial business than in the medical, as an effect of the rapid increase of the installed base in the last years, with numerous systems reaching the end of the warranty period. The one-time expense depleting our performance in Q1 2024 is the accrual posted in With Us, the Japanese company dedicated to the local professional aesthetic market. This market and this company had been one of the most significant revenue and margins driver for the group, but not in the recent past. The accrual takes into account the financial downturn of our most significant customer, a chain of beauty salons dedicated to hair removal. This circumstance is undermining our residual activity on the professional aesthetic market in Japan, an activity that, due to competitive pressure on the specific segment, was currently limited to the servicing of the base, installed base only. We're examining the downsizing options. The effect on a consolidated basis of this event, and of its foreseeable to-date consequences, will not materially affect the business trend and the guidance. Cash flows have been a topic for El.En. during last year, with a strong cash absorption trend in the first half of the year, that was then partially absorbed by the excellent cash generation of the second half. Cash absorption in the first half and generation in the second half is the seasonal trend for our organization, and 2024 is no exception. The net financial position decreased by EUR 8.5 million in the quarter, mainly due to the dynamics of working capital, namely inventory increase in preparation of the stronger Q2, and also of down payments received from customer and paid to vendors. Capital expenditure was also a little above the quarterly average expected in the year, also due to contingent IFRS 16 effect connected with renewal of a building rental contract. We consider this trend physiologic and not concerning. We are not expecting the net financial position to improve in the Q2 as well. It's the quarter when we pay dividends to our shareholder and taxes to our government, while we expect the improvement in the second half of the year. I'd also like to briefly report about the activities we are carrying out in the field of sustainability. The 2023-2027 five-year plan was drawn up, identifying specific and measurable sustainability activities and objectives in the fight against climate change, circular economy, economy, promotion of a responsible supply chain, valorization of people, and contribution to the community. Confirming the commitment to sustainable development and that environmental and social responsibility are becoming an integral part of the group's business model. We also launched the projects that will allow us to align with the reporting regulatory requirements by the end of this financial year. At this moment, I'm done with my introduction. I'd like to give the word to Enrico for the financial report. Thank you, Andrea. Good morning, everybody, and as usual, I'm going to provide some details on our last financials. The group achieved in the Q1 2024 a total turnover of EUR 149.5 million, down 7% compared to the 161.4 of the Q1 2023. ...The slowdown in sales in the period was more marked in the industrial sector, as, as we can see in the slide, -10% than in the medical sector, -5%. The impact on sales of the two sectors remains the same as for the last year. In 2024, the weakness of foreign currency, mainly US dollar, renminbi, yen, again, euro, had a cumulative impact on the growth of approximately -1.2%, -EUR 1.8 million in absolute value. Gross margin stood at EUR 62.4 million, up 2.1% compared to the EUR 61.1 million as Q1, and with an impact on sales of 41.7%. The gross margin, as already mentioned by Andrea for the period, includes the other proceeds, the reimbursement obtained in relation to the damages suffered from Campi Bisenzio flood in November 2023, for an amount of EUR 1.9 million, equal to 1.3% of consolidated revenues. Even net of this not repeatable income, the mix of products sold lead to an improvement in sales margin from 37.9% to 40.4%. In fact, a removal, the most consolidated application, but with the lowest sales margin in aesthetic, decreased its relative weight compared to the other application, just as surgery, which has better margin, that increase its weight. In the industrial sector, the share of cutting, bearing a lower margin compared to the marking system, allowing sources which perform better in the period, decreased. At the same time, in the margin in the sales, in the laser cutting sector, however, improved due to the greater incidence of sales outside Italy and China. Operating expenses increased in the impact on sales, up from 8.7% to 10.6%, and the main reason are the sales and marketing expenses for trade fairs and congress, encouraged by both medical and industrial companies. The number of international trade fairs and conference, in which the group participated in the first month of the year, was significant and above average. Staff cost increase of EUR 1.1 million, +4.4%, up as impact on sales from 16.2%-18.2%, due to the lower turnover recorded in the period. As for 1.4 percentage points, the increase in personnel cost is determined by the increase in national cost for stock option plans for employees, equal to EUR 856,000 in the period, compared to the EUR 453,000 in the Q1 of 2023. In terms of EBITDA, the EBITDA was positive for EUR 19.2 million, decreasing by -8.2% compared to EUR 20 million of Q1 2023, and the EBIT margin in the Q1 was 12.9%, in line with the 13% of the Q1 2023. BIT for the quarter showed a positive balance of EUR 14.3 million, down compared to the EUR 17 million of Q1 2023. Its 9.6% margin on revenues was in slight decrease compared to the previous year, when the margin was 10.6%. The provision of EUR 1.6 million for credit risk, set aside by, with us, our Japanese subsidiaries, following the financial crisis mentioned by Andrea of its most important customer, had a significant impact on the quarterly EBIT, and in fact, offsetting the, proceeding, the positive effect coming from the reimbursement received for the flood. The impact of these accruals is 1.1% on EBIT margin. We recorded in net financial income, EUR 187,000, income, compared to a loss of EUR 459,000 recorded in the same period of last financial year. An improvement, essentially, due to the more favorable effect of currency exchange rates in the period. Income before taxes showed a positive balance of EUR 14.4 million, and recorded a 13.3% decrease compared to the EUR 60.6 million of Q1 2023. In terms of cash flow, the group net financial position remained widely positive for EUR 46.2 million, compared to EUR 54.6 million as of December 2023, decreasing by EUR 8.4 million. The increase in net working capital absorbed EUR 9 million, while EUR 10 million were absorbed by the change in other short-term asset and liabilities, including the increase in advanced pay to supplier, the decrease in advance received from customers, and the increase in VAT credits to the Italian treasury due to the increase in export. CapEx in the period were EUR 5 million. EUR 1.5 million were related to expansion of reorganization works at the manufacturing plants, and the same amount for equipment, vehicles, and other assets. As for EUR 1.5 million, the booking of new investment derived from the accounting of rental fees according to the IFRS 16 standard, with an effect on the net financial position, but not on the liquid position. Revenue by business, in the medical sector, the positive phase of surgical application continued +4% in the quarter, with EUR 20 million in revenue, due above all to urology systems. Aesthetics, with a turnover of EUR 48.4 million, compared to the EUR 55.6 million in Q1 2023, marked a decline of 13%, which is reduced to 10% if including service revenue pertaining to the aesthetics itself. The turnover of after-sales service and consumable was once again growing by 7%, tied to the use of laser system in urology. Optical fibers contribute to the positive trend of revenue in the medical service, which recorded sales for EUR 19.91 million versus 17.8 in Q1 2023. The therapy segment, managed by ASA of Vicenza, with revenue of EUR 3.7 million, marked a slight decline in revenues in the quarter, -5%, compared to EUR 3.9 million in Q1 2023. In the industrial sector, the laser cutting sector, which in the recent years recorded a long series of growth quarters, showed in the most, the most marked decline, -15%, with revenues at EUR 44 million, compared to the EUR 51.7 million in Q1 2023. The business unit of laser cutting, including the pertaining part of service revenue, showed a total turnover of EUR 47.8 million, compared to the 54.3 million in Q1 2023, minus 12%, and an EBIT of +EUR 1.2 million, compared to the -EUR 1 million of Q1 2023. The EBIT of Q1 2024 include EUR 1.2 million as non recurring proceeds, as part of the EUR 1.9 million reimbursement for the fraud mentioned before. The turnover of the Chinese activities remain substantially in line with the 2023 levels, limiting the losses, thanks to a reduction of structural cost and to the improvement of margin for the increases since outside China. The marking sector, with a turnover of EUR 6.4 million, compared to EUR 6.7 million in the same period, 2023, recorded a decline with a weak quarter in decoration application, also for the widespread difficulty in the period in the fashion system, and a growth for the business unit of identification and traceability system, managed by LASIT of Torre Annunziata. After-sales service revenue show a noteworthy acceleration, +24.3%, with sales for EUR 6 million, compared to the EUR 4.8 million in 2023, which depends directly on the rapid increase in the installed base. The trend in the sale of medium-power laser sources was very satisfying, growing by 12%. Sales by area. The sales trend by macro geographical area for the two sectors confirms a better performance in foreign markets than the Italian market. In fact, the sales trend in the medical sector shows a decline of 5%, mainly due to a market decline in the Italian market. Sales in the industrial sector were affected above all by the weakness of the Italian market, and to a lesser extent, by the European one, recording instead a recovery in the countries of the rest of the world, thanks to the stable trend of the Chinese market, the excellent performance of the Brazilian subsidiaries, and the rapid acceleration of the U.S. market. Andrea, please go ahead for the guidance. Okay, thank you. Now, to summarize, everything with the guidance, as you have read in our press release, after the Q1, we are in essence confirming the yearly guidance, which points to increase both revenues and EBIT compared to 2023. The initial remark we already today, two months later, the initial issuing of the guidance, takes into account what we have seen changing in these two months. We are still confident in the recovery against 2023 in the remaining quarters of this year, but certain macro trends that were supposed to support such recovery, namely the decrease in interest rates and the smoothing of the international and regional unrest stemming from the wars, are taking more time than expected to take place. It's exactly for this reason, and because of this, and not because of the slower results registered in the Q1, that hitting the guidance target becomes now more challenging than we were thinking two months ago. Bianca, I'm done with the prepared presentation and ready for the Q&A session. Okay. Okay, and we have received three persons in the list. Giovanni Selvetti is the first one from Berenberg Bank. Go on, Giovanni. Thanks. Hello, everyone, and thanks for taking my questions. So I have a few. The first one is on the Chinese market. In your press release, you talk about sales substantially in line to last year, with losses that were limited. I seem to recall that in the last quarter, excluding the impact of the legal costs, that China was back to a positive EBIT. So I'm trying to get a sense of operating leverage here. So what is the target amount of sales you need to do in China to break even, basically, right? Staying on China, you say that the balance of bank and postal deposit of Chinese company include roughly CNY 7.5 million of deposit banking, the issuance of bank bills for payments. I mean, what does that mean exactly? The third one is, maybe, Enrico said it before, I didn't get, if you can please quantify the expense for exhibition and fairs in the Q1. And then I think that the other one is more about, you know, the guidance. So I guess that today's performance is really about what consensus interpreted as a slow start of the year. So in order to avoid confusion, what are we speaking about the rebound in Q2? Is a rebound of 3, 4, 5% in terms of sales? Just to have a sense of what we can expect in the Q2 of the year, and so for the first half. And the last, really last one, is more of a general one, but if maybe can also explain the reason for the weakness in Italy. Recently there are some speculation that Prima Industrie and Salvagnini would like to build an Italian main player in laser cutting. Here the questions are, two, do you see an increased competition, there? And three, if they really want to build a national player, would you be considering selling? That's... I'm done with the question. Okay. Question number one, China. We were close to break-even in Q4, but we had the accrual that brought us below break-even in Q4, excuse me, 2023. Q1, it's seasonally a small quarter, especially China, where you have the New Year's festivity hitting China, and therefore, typically you have the lowest leverage effect on sales. For this reason, the fact of having improved but not met the break-even level in China, of course, is not satisfying, but confirms that we are on the way of meeting the break-even on a yearly basis because what we have in the Q1 is reduced revenues. If you give me a second, I'll try to give you a more detailed answer. Basically, in China, the revenues for the quarter were just over EUR 20 million. I believe that we need about 20% more, 20% to 25% more, I mean, closer to between EUR 25 million and EUR 30 million in revenue to get to break even, given the current margins. Of course, the level of break even lowers with the increase of sales on the international market, which are, as I mentioned, bearing higher margins. This is question number 1. Question number 2 is basically, maybe I try to explain, then Enrico, if I'm wrong, you will get it better. Since we are using certain notes to pay the suppliers, the bank is holding somehow in escrow some of our bank deposits until those notes are paid. Yes. Exhibition cost. The exhibition, if you want the sales and marketing in general in the Q1 2024 was including Congress, and fair and traveling expenses and so on, we are talking about of, more than EUR 5 million, EUR 5.1 million, compared to EUR 4.5 million of Q1 2023. Grazie, Enrico. Thank you, Enrico. Thank you. Concerning the short-term guidance, it's hard for me to give you a sense, because I am confirming a midterm guidance. I cannot tell you. I'm sure we will see an improvement of the Q2 financial results of 2024 against the Q2 2023, but I'm not in the position of giving you a figure, a figure on that. About Italy, the reason of the strong slowdown in Italy is mainly driven by the industrial market, but we slow down in medical market as well. Basically, I believe I gave quite an extensive description of the situation of the Italian market for manufacturing investments in early 2024. We were expecting a slowdown because the Industry 4.0 is losing its effect. We have several customers procrastinating investment decision, waiting for the rules for the 5.0 new tax cuts to be finally disclosed in details. As you know, the 5.0 is in place, but the details on how you file and how you get the monies and what you have actually to do are still uncertain. This, in a situation in which the market is not strong, because we are not in a situation of strong market, has slowed down the investment decision. For what concerns the medical market in Italy, we are in a situation which is normal. We had a slowdown, especially in the aesthetic part, in the aesthetics. We feel fairly comfortable that the situation, anyway, can keep at good revenue levels with good margins and good profitability of the activity in Italy as well. Concerning the Prima and Salvagnini deal, we know the two subjects involved in this potential deal. We believe that they have good reasons for merging since they are complementary on several of the business they work on. I mean, they... If the deal is confirmed, they will generate a single entity of the dimension of roughly EUR 1 billion in revenues, considering also the revenues generated by Prima with its Finnish structure. They are not a threat for us in terms of competition for what they are doing today, because the El.En. Group is widely complementary to both Prima Industrie and Salvagnini, since we compete mainly on the two-dimensional laser cutting systems, whereas Prima is mainly active in the three-dimensional cutting and has a very, very weak presence in the two-dimensional cutting. And we are complementary, because we have a significant production base in the Chinese territory, which is something lacking for both Prima, that tried to but never actually succeeded to create a real stronghold in China, and to Salvagnini. And Salvagnini doesn't have any facility in China. By the way, it is important to mention that we are complementary, especially to Salvagnini, and in the trend that we are pursuing, of integrating our 2-D laser systems within manufacturing cells, manufacturing cells, or larger manufacturing factories, which include not only laser cutting, but also the movement of the cut pieces, the storage, the nesting of the parts, in one word, automation. We have on the Chinese territory cooperated with Salvagnini on a few very good deals. Andrea? Si. We have one more question from Carlo Maritano, from Intermonte. Go on, Carlo, please. Hi, good afternoon, everyone. I just have a couple of questions. The first one is on guidance, a clarification on guidance. So you said that current situation makes it difficult to maybe achieve the initial targets. But you expect anyway to grow in terms of, say, EBIT this year, or you expect a flattish or negative EBIT compared to last year? And this is the first question. The second one is on the industrial business, especially in Italy. You already answered partly my question. So the delay in Industria 5.0, do you expect will last for at least a couple of quarters and to see some revenues by the end of the year? Or do you expect a longer term before starting to see revenues from these incentives? The final one is on the services business. So as you mentioned during the presentation, this is growing thanks to the increase the installed base. So do we have to expect in the future the incidence of services to grow given that the installed base is growing? So do you expect to account for more than 10-13% of revenues in the future? Thank you. Okay, let's start from question on guidance. So we confirm that our guidance is to beat 2023, both in revenue and in EBIT. We add that it's harder today as an objective than it looked like two months ago. About the expectation on the Italian market, we are positive in general, but this is completely detached from the 5.0. What I wanted to mention is that while, of course, we can attribute part of the success, especially in the year 2022, of the sales of manufacturing devices to the existence of Industry 4.0, today, the fact that nothing is clear about Industry 5.0 is simply procrastinating the investment decision to the point that I'm saying that today it would have been better if there was no expectation for such a tax cut, because, if there were no expectation to have future tax cuts, people would have invested because there was no reason to wait. And this, in this moment, they wait for something which could be also quite complex, especially for smaller investment to achieve, because as you might know, the 5.0 includes adding to the 4.0 requirements, also the power supply reduction, the power consumption reduction, which is complex, not only in achieving it technically, but also in documenting it. So it will cost to the investor to prove that the investment is leading to a saving in power consumption, and by this means, the incentive which will be provided by the 4.0, 5.0 will be lower due to the costs which are connected to the proofing to the proofing of this. And the other, the third question, the service business. The service business, yes, generally speaking, generally speaking, and we see this in an evident way in industrial business, where the installed base has been increasing very rapidly in the last two years. And we see it with a little delay with the increase of the installed base because they are covered for by warranty for a certain period. Now, the system exit the warranty period, and they start generating revenues. So the statement is correct for the general trend of technical service. So if the service line was technical service only, the answer would be definitely yes, it will increase, and it will increase its share. The point is that in our service aggregate, we do not have service as technical service revenue only, but we have also consumable revenue, and consumable is quite an important share of these service revenues. On this point, the trend is not necessarily tied to the installed base, but it's also tied to the usage of the installed base for the specific application for which the consumable is needed, and by the availability on the market of alternatives to the consumables that are provided by our group. Not necessarily we can lock up the customers to the use of the consumable that we provide, but under certain circumstances, certain customers can purchase their consumables by themselves. Generally speaking, the answer to your question is yes, but there are certain considerations, considering the actual composition of the sales aggregate we call service. Very clear. Thank you. Andrea, the third question comes from Andrea Bonfa, from Banca Akros. Go on, Andrea, please. Hello, good afternoon to everybody. I got a couple of questions. One is related to the growth of the industrial laser in the rest of the world. If you can elaborate a little bit more on the, let's say, 30%+ increase, is that China to the rest of the world, and in which countries? Obviously, Italy to the rest of the world, and again, in which countries, and I'm wondering what's the contribution in the Arab Brazil and in U.S., which is a market that you target in the past. And the second one, if you can just repeat the EBIT performance of the industrial laser business, which I'm not sure I quote very well, it was minus 1.2 or plus 1.2, and what was the component there of the Nordic Harin, if I am just to correctly. Thank you. Yes, first, so outside non-domestic sales, meaning domestic is Italy and China, increased rapidly in Brazil. We had record sales in Brazil, in the US, and here are the markets where we did very well for the Western markets, and then we did well in Korea and Australia for the markets served by, by China. For the second question, I don't think I gave any EBIT information. I think I gave you some gross margin information. ... Well, Puerto Rico provide- I did. I gave the- Ah,. Yeah. Okay, the business unit of cutting. I'm talking about the business unit of cutting. I say that, compared to the Q1 2023, that was, we had in the Q1 2024, we had, a positive EBIT of EUR 1.2 million, and this 1.2 million is, the contribution to this, the, this EBIT is, due to, 1.2 million of non-recurring proceeds. So excluding the non-recurring proceeds, reimbursement, of the damages, of the flood, in November 2023, the EBIT of the business unit was zero, compared to minus one million of last, of Q1 2023. Clear. Thank you very much, Enrico and Andrea. You're welcome. Bye, Andrea. Okay. Bianca? Sì. Next question comes from Andrew Lawford, from Fund Scouting. Go on, Andrew. Thanks. Thank you, Bianca. Just a quick follow-up question about the service revenue which you've already commented on. I noticed that it has expanded as a percentage of sales if we compare it in the Q1 to what you did in 2023. Is that a trend? I mean, can it get towards, say, 20% of revenue, do you think? And just if you could maybe comment on the margin dynamics of the service revenue. Do we generally expect higher margin from service revenue, or does it again depend on the distinction you made between technical service and the consumables? Thank you. Okay. We will have an increasing, let's say impact of service revenues on boxes, on systems revenues, if we maintain the same ratio of consumables revenue. It could increase. I believe we are already at a fairly high level, at a fairly high level. Concerning the margin, it is more or less comparable to the margin we have in system sales, so we don't have much difference, because, as I mentioned to you, as I mentioned when talking about, for instance, optical fiber sales, we are not necessarily alone. The customers are not captive, so we are not able to freely set the prices at whatever margin we want, but we have to keep market prices, and therefore market margins, in order to avoid to lose the revenue to alternative suppliers that might be entering our customer base for selling their consumable devices. Okay. Thank you. You're welcome. The last one comes from Lorenzo Capellotto, from Praude Asset Management. Go, Lorenzo, please. Hello. Thank you for taking my question. I have a couple, actually. The first one is, as far as I understand, you said that mostly the slowdown was in the Q1 was due to the problem with the incentives, in particular the 4.0 ended and the unclear picture regarding the 5.0. But if so, why all your sectors across the board, including the medical, went down in the Q1? If you can explain a bit better, what was the driver that made performing poorly also the medical segment? Second question is, I see that the labor costs are going up quite substantially, and so I was wondering, are you having troubles to hire new people and attract new talents? And so if you can give a bit of explanation on this front. And finally, in the worst performing in the Q1 was, of course, the cutting segment, and on this front, is it the slowdown due only to market factors, or a weakness in the sector, or are you experiencing higher competition from other competitor like Chinese, Turkish, which as far as we know, are they keeping growing, and they are putting pressure on you? And this is all from my end. Thank you. Okay. I'll start answering your first question, which answers also the third question. When I mention that the ending of 4.0 and the slow entrance of 5.0 is slowing down our sales, I am mentioning exactly one market only, the Italian market for industrial application. 4.0 is not applicable to medical applications, and is not applicable abroad, so I'm just saying that the area in which we had the strongest slowdown, which is Italy, cutting business, was also affected by this situation with incentives, and this is specific. The rest of the slowdown, I mean, I described it as a progressive slowdown that we experienced beginning from the initial months of 2023, which basically normalized the demand pressure after a peak of demand, which we experienced in 2022. The first months of 2023 performed well also with the momentum of the exceptional demand, which was the rebound after the COVID period that we had in 2022. Then situation normalized, and we have seen this normalization affecting our sales volume in a slow relative reduction to the previous years in the various quarters. And we have seen that order bookings would have led to a reduced amount of revenues in the Q1 of 2024 over the board, in, in more or less all the segment. Of course, there are exceptions, but as the envelope of all the revenues, we, we had noted it. We had also noted that order booking had, at least for our company, touched, let's say, a bottom, at the end of 2023, and order booking started again being stronger at the beginning of 2024, allowing us to forecast the revenue growth over the whole 2024, as an effect of this increased volume in order bookings, and also in the fact that in the following quarters, we will face a less challenging benchmark in the 2023 results. Concerning the increase in the expense for, for staff, for employees, of course, we, we were planning. We are always planning a midterm increase of our volumes of sales and productions. In order to support them, we have to hire people in R&D, in production, in all the, in all the functions. After three years and two years of increasing revenues, we also increased the number of employees, apart certain exceptions. Therefore, once you increase the employees over a year, when you, at the beginning of the following year, compare the expenses for employees with the initial expense of the year, you always have a you say, a comparison which shows up an increase. This is also due to what you're mentioning. We have to pay great attention to the general welfare of several categories of employees, because the market, especially for certain kind of employee, is becoming more competitive. It makes our employees cost more, and it makes also imposes a pressure on the general welfare of the employees, for which we have to provide them also some, let's say, environmental support to make the job that they are taking in our group more, more attractive. So the problem that you're mentioning is there. I'd like to say that we have this problem quite clear, and we believe that we have the appropriate policies to be able to provide and to effect that the appropriate quality of personnel stays into the group, which relies on the quality of its technicians, of its designers, of its engineers, in order to, to continuously improve its product range and to be able to grow due to its ability to innovate. If I can follow up? Sure. Regarding competition from China, Turkey, and... Can you add a bit of flavor to that, please? Sure. Competition of China is, of course, a theme, a topic. We all read newspapers. When we read that Fiat is gonna sell Chinese cars, or better, Stellantis is gonna sell Chinese cars, means that the local production, they don't feel they can compete with local production. The competition coming from the Far East countries has always been a theme in our market. The competition of Chinese manufacturers is very strong in China as well. I mean, we are Chinese manufacturers for the industrial market, but we are struggling in China as well. But the international markets-... are typically more articulated. We are, especially in industrial, dealing with a fairly large market, on which we can compete on, certain niches, in certain niches, where we are able to maintain, certain margins. In a way, our very, very fast growth in the past was accomplished also due to the fact that our product was somehow commoditizing, and we took advantage in being part of a business where the product was commoditizing and becoming cheaper because the market was becoming much larger. When the market becomes too commoditized, a manufacturer, a small manufacturer compared to the larger size of certain competitors, loses competitive advantage unless it concentrates on certain niches in where it can maintain the advantage of providing products that have superior characteristic, both in technical specification and in service provided to the customer, compared to the low-cost Far East competitors. Do you find other countries where that are competing with you, like Turkey, as I mentioned, or they are not part of the equation? Oh, no, no, the Chinese manufacturers of laser cutting systems are present worldwide. We, as Chinese manufacturer of laser system, are also selling worldwide. The point is that typically, Chinese manufacturers compete on a lower price level, on a lower market, market area. We compete on a higher price level and higher market area. The same applies when we sell on the same geographical market, products that we manufacture in China and product that we manufacture in Italy. They, let's say, theoretically, compete, but in fact, they are not competing on the same market segment, because who wants to buy an Italian-manufactured laser system with Italian cost and Italian performance, Italian services, typically is not interested in buying a Chinese-manufactured laser system. Yes, yes, I understand, but what I meant is, are there any other country which is as competitive as Chinese that are entering the market? Like, I don't know, Turkey or Poland. Yes, yes. You mentioned, today, the most competitive markets are China, Italy, and I believe probably Turkey. Also because each of these markets has local competitors, which have done a good job in opening up the market, and now have also Chinese competitors entering the market. Okay, thank you for your time. Oh, thank you for your questions. Andrea, we have one more question from Ludovico Latmiral from Samita Investing. I will read the question for him for a technical problem with his microphone. Then the question is: "Can you please comment also on the evolution of cash flow for the full year? Should we expect a reversal of working capital from the current level? Yes, I can comment, and I can confirm that, for the full year, the forecast is to generate cash for our internal programming reason and for the dynamics, the seasonal dynamics. Typically, the first and the Q2 are the top cash absorber in the year. There are reasons which are slower, lower sales volume in Q1, payout of dividends in Q2, higher record sales, let's say, on the year in Q4, which allocate most of the cash generation in the second half. For this reason, we note the cash consumption of the Q1, but we are confident that, given the trend that we expect on the year, we will return to cash generation in the next quarters, not in the second, but in the third and in the Q4, and for the full year. Just a moment, Andrea. I'm asking Lorenzo if it's everything you need indeed to answer. Okay, it's okay for you, for Ludovico. So, at moment, we have no more question. Just want to ask from the floor if there are more questions. Any other question? Then- Grazie. Thank you, everybody. Thank you. Thank you so much for- Thank you, thank you. We will wait for everybody on the 30th here in Florence. Maybe, Matyaka, you could recall. Yes. Maybe Christopher, maybe Christopher, do you have a question? No, I'm fine. I'm fine. I'm gonna come and see you soon anyway, so... Okay. Okay. Okay. Thank you so much to everybody for attending the conference. Bye. Bye. Thank you. Bye. Bye-bye.