Good afternoon. This is the Chorus Call Conference Operator. Welcome, and thank you for joining Lottomatica Group's first quarter 2026 results conference call. As a reminder, all participants are in listen only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star zero on their telephone. At this time, I would like to turn the conference over to Mr. Mirko Senesi, Head of IR at Lottomatica. Please go ahead, sir. Thanks, operator. Good morning to everyone. Welcome to Lottomatica Q1 2026 results presentation. I'm here today with our CEO, Guglielmo Angelozzi, and our CFO, Laurence Van Lancker. The floor directly to Guglielmo for the presentation. Guglielmo, please. Thanks, Mirko. Good morning everybody. We can start with page two of the presentation. Very happy to share with you another very good quarter. EBITDA continues to grow double-digit on a normalized level, and also revenues. We have a + 7% EBITDA also on a reported basis, notwithstanding the negative sports payout in the quarter. This is on the back of a very strong market. As you can appreciate from the two graphs on the below part of the slides. Online has continued to grow mid-double-digit in terms of bets and so total sports meaning online and retail. At the same time, we've performed well in competitive terms, as you will appreciate in a few minutes. Let's go to page three. Well, this is the list of the main items that we think is relevant to comment for the quarter. As I said, the market has been strong. Tail operators have continued to lose market share, particularly in iGaming. No issue from prediction market notwithstanding a recent sponsorship. They continue to be legal. The product consumer mismatch continues to be strong. We don't believe there is any market space and at the same time, sponsorship has basically no impact in enhancing local brands. Very good news on PWO market shares. IGaming, we've recovered half of the share that we lost through the migration. We're a bit behind in terms of iSports, but this is explained by the market trend on overall sports, meaning online plus franchise, which you know, franchise has been particularly strong in the last few quarters. It is the case also for us. If you look at total sports, we have recovered to pre-migration levels at 9%, and we'll see more detail in a few minutes. There's been a refinancing done with the important raising more capital, more debt, EUR 765 million. EUR 400 million was a refi and, you know, additional capital for general corporate purposes, including buyback and bolt-on acquisitions. The overall consequence of this that is that will lower our cost of debt from 5.3% to 4.9%. Page four, all that I have said, leads to, you know, strong confidence on us being at the top end of the guidance for 2016. Also in being able to confirm our strong commitment on capital returns, with up to EUR 1 billion to be returned to shareholders in 2026 and 2027, including dividends. The keywords are continued growth and continued returns to shareholders. Let's go quickly page by page to see the items, the relevant items that I mentioned a couple of minutes ago. Market, strong market momentum. You see the details here. iGaming grows mid-double digit. iSports grows mid-double digit. Sports retail shy of that, of course, in terms of bet, because that's the only thing you can look at, given the payout dynamic in the quarter. Page number six, you can appreciate the details of the tail operators progression and our progression in terms of market share. This is on iGaming on the tail operators. You continue to see the sharp decrease trend starting from it was progressing throughout the year, and it was an overall trend, but it has accelerated starting from the new concession. From 2024, 4.4 points, which is roughly 25% of the total market share that this cluster has been lost. We continue to grow market share. The 32.2% that you see there is including an additional bolt-on that we've made after Sportbet. We've done another deal with Bg ame, so this is a pro forma for that. You know, very good performance both organically and with our deals that allow us to quicker consolidate, take advantage of the erosion of the tails. Page number seven, you know, super fast, that's was basically I just commented a few minutes ago on prediction markets. There's a bunch of data points here that you can look at and that show why this continues. This is not at all an issue for us. I think we can go directly to page number eight, which is the progression on PWO. We've separated from iGaming and sports. You know, iGaming, half of the market share which had been lost due to the migration has been recovered, and there's a consistent path. It's not really there's not really volatility in the progression. Page number nine is the same trend for sports. You can see in the graph, sports as a total, completely recovered, and then the detail and the breakdown between iSports and sports franchise. There is still room to go in iSports, but this has been, you know, compensated by a more than favorable trend on sports franchise. This is the consequence of the trend that we have observed at an overall level in the market, and also as it was mentioned before by the fact that actually the retail recovery, the retail transition was structurally faster. As you know, our GGR to profitability to EBITDA contribution from the two segments is pretty much about the same. Actually this is very good news. Page number 10 is basically a summary. We wanted to recap and make sure we were on the same page. We're on the same page, and we fully appreciate the model, the business model of Lottomatica, the overall framework and setup. On one side, you have a very strong and resilient business model because of a bunch of reasons, including omni-channel, product tech, AI leverage, which results into top-line growth, cost control and scalability, M&A demonstrated M&A and integration capabilities. That's the core business part. We believe we have a very robust and steady capital structure, and as you've seen, we continue to optimize our financing costs, our balance sheet, and through that, the financing costs. We believe we have a smart capital allocation, meaning a good balance between organic growth compared to M&A and compared to the right shareholder remuneration. This results into growth and returns, which is, you know, it's the first page and the last page of this section of the presentation. We wanted to do an interesting exercise, I believe. We took all European-listed companies with market cap above EUR 5 billion. We went to filter those which have grown at least 10% with EBITDA. Those who have at least 30% EBITDA margin, those who have at least 75% of cash flow conversion. Really cutting the parameters at the top end of the range. You are left, and then those which have total shareholder returns of at least 100% in two years. You're left with three companies, which is, you know, of course, less than 1% of the almost 400 companies that we started with. That's basically the result of the model that you see on the left, growth and returns. I leave the floor to Laurence. Thank you, Guglielmo. On page 12, you can see that on a normalized basis, our revenues are up +10% and EBITDA +22%. On a reported basis, despite the payout headwinds, revenues were up +3% and EBITDA +7%. Just as a reminder, we are comparing a Q1 2026 with a very unfavorable payout to a Q1 2025 with a very favorable payout. I'd say our EBITDA margin has hit 39% due to the higher weight of online in this quarter. We move on to page 13. Here again, we see on a normalized basis how we have continued to see good growth for both online and sports. Still in double-digit territory. We are +17% for revenues online, +11% for sports franchise, on an EBITDA level, +29% and +21% respectively for online and sports. When you look at it on a reported basis, you can see what the impact of the payout affecting mainly the sports franchise segment. Whilst despite the unfavorable payout online, EBITDA has still grown by 18%. Gaming franchise is flat at a revenue level and slightly up, so +4% in Q1, partly due to bolt-ons, and distribution insourcing and also some timing of costs, which we will reverse throughout the course of the year. Page 14. On the left-hand side, you can see the total CapEx, including recurring and concession, amounted to EUR 39 million, of which EUR 25 million recurring, slightly higher than the previous year, and the EUR 14 million concession CapEx in line with previous year. On the right-hand side, you can see that operating cash flow reached EUR 196 million, up plus 6% from last year. This growth number, if we had a normal, in a normalized both 2026 and 2025, Q1 for payout would have been + 25%. Page 15. We closed the quarter here with a net financial leverage of 2.3 x and the cash of EUR 119 million. Looking at the bridge from the net debt as at the 31st of December 2025, you have EBITDA, then a negative working capital absorption in Q1, reflecting the typical seasonality of the business, CapEx, financial expenses and leases, then we acquired EUR 56 million worth of stock in Q1. Other, which also include extraordinary items in relation to the closure of our Serbian branch, which leads us to a net debt of EUR 2.052 billion on the 31st of March 2026, equivalent to a net leverage, as I said earlier, of 2.3 x. That's it on our side. Thank you, operator. I think we can open up for the question. Thank you. This is the Chorus Call conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touch tone telephone. To remove yourself from the question queue, please press Star and two. We kindly ask to use handsets when asking questions. Anyone who has a question may press Star and one at this time. That's Star and one. We will pause momentarily as callers join the queue. The first question is from Ben Shelley with UBS. Please go ahead. Hi. Good morning, guys. Thanks for taking my questions. I've got two, please. First, I hear you on the opening remarks. Could you expand a bit more on EBITDA margins in the quarter, specifically online EBITDA margins? Any color on the drivers there would be much appreciated. Then my second question on online bet growth of 15%. Could you talk about exactly what's behind that, particularly in iSports, where I don't think we've seen double-digit volume growth for some time? Thank you. Hi. Sure. Listen, on the EBITDA margin in online, it's, you know, 57.5% this quarter. Q1 has been a good quarter in terms of volumes, so that is one factor that contributes to the favorable margins. Also we are seeing the, you know, the full impact now of the synergies, you know, Q1 2026 versus Q1 2025, you know, of the synergies that we've realized for PWO. These are the main drivers. So in terms of bet growth in on sports, we have seen, first of all, we are also comparing periods, you know, two periods where with different with different payouts. You know, Q1 was very favorable, very favorable to us, and this Q1 2026 was very unfavorable to us. There is some payout dynamic also that impacts the bet growth. I would say that, you know, we've seen this continued growth since the beginning of the year, and there's no real other reason than some of the payout dynamics. We continue to believe that this segment in aggregate will continue to grow in the midterm at around 8%. Thanks, guys. The next question comes from Estelle Weingrod with JP Morgan. Please go ahead. Hi. Good morning, and thanks for taking my questions. Just again on the online margins, you mentioned in the past a level in the mid-50s would make sense longer term. Is it still the case or should we be looking at something a bit higher, high 50s or something? I have another question on the PWO market share evolution. May I ask why is iSports lagging the sports franchise in terms of the recovery versus pre-migration level, please? Thank you. Awesome. I can, I can, I can take both. On the, on the online margin, we have had one good quarter of good margins. I would still say that we're the mid-fifties, maybe in the midterm we're a bit at the high end of the mid-50s. We have scope definitely to potentially do a little bit better than that. Anyway, let's see how things progress also over the, over the course of the year. On PWO, on the market share, Planetwin365 is one of our most omni-channel brands of the whole portfolio. As, as you know, the shift between online and retail is much more between channels is much more permeable. Therefore the demand has moved, you know, in the past few quarters, more on the retail side than on the online side. I'd say, it happens in particular omni-channel, especially for highly omni-channel brands. We've continued to see this as well at the beginning of this year, where retail was very strong and online was doing well, but not as well as retail. We might see a reversal of this going forward. We'll see. As just as a reminder, as you already know, Estelle, it doesn't really matter to us from a profitability standpoint because when GGR moves from retail to online and vice versa, the contribution margin is very, very similar. We're quite indifferent to this shift. Thank you. The next question comes from Fabio Pavan with Mediobanca. Please go ahead. Yes. Hi, good morning. Thank you for taking my question. I have one on the, on your decision to update full year guidance, given your sort of approach. I think this is, probably, best news we have today. I was wondering if this is mainly driven by, stronger than expected market dynamics or higher increase in market share, better margins or mix of these three elements. Thank you. Thanks, Fabio. It's really a combination of all these factors. I'd say that volumes have been extremely strong in this first quarter, and we're seeing a continued growth after that. That gave us, it's definitely one of the elements that gave us confidence to put us at the high end of the guidance. The other element more on the cost side is we see some impact also from the closure of the Serbian branch, which has moved, which has contributed from a cost standpoint to increase the range of the position ourselves at the end of the guidance. I think these are the main drivers. I would say that probably the one of the determining factors has been this very strong market growth. Thank you. The next question is from Clark Lampen with BTIG. Please go ahead. Thanks very much. I have two quick ones, if I may. On the online margin trajectory over the balance of the year, just curious if you could share any perspective around the phasing and I guess sort of timeline for margin improvement over the balance of the year. Just curious if there are either comparison headwinds that we should be aware of the 2025 timeframe or any lumpiness on the network side or with fixed costs this year, maybe beyond I guess what you just mentioned with Serbia. Another, I guess, sort of clarification with volume growth over the balance of the year. I think if I heard you right before Laurence, in the first answer you mentioned that we should think about 8% over the balance of the year. Is that the right way of thinking about the embedded growth assumption for the online business? If so, is there anything meaningful factored in either 2Q or 3Q for World Cup tailwinds? Thanks a lot. Hey, Clark. On the online margin, if you look at the evolution over the quarters, obviously assuming that all else being equal, Q1 and Q4 are the strongest quarters of the year. Q2 and Q3 tend to be the, let's say, the weakest quarters of the year. You have a seasonality dimension that to take into account. The second thing I'd say is that because in Q1 you were comparing Q1 2026, where you have the full run rate effect of the synergies with a Q1 2025, where we were still in the process of implementing synergies. There's an element there that has that, you know, compares favorably when you compare the two quarters. In terms of volume growth, 8% is our sort of midterm view of the overall sports segment, including retail and online. You know, we'll this year, you know, we obviously we have our projections and which is what is ultimately reflected in the guidance, but we do have some tailwind from the World Cup that helps as well. Thank you. The next question is from Domenico Ghilotti of Equita. Please go ahead. Good morning. Two question. One on, is on the synergies. I would try to understand if we have to assume that the Q1 is at full run rate because you are mentioning the Serbian branch closure. I'm trying to understand if it was already driving results in Q1 or something that will be left and in case, how much we can expect from this action. Second, on the current trading, you made reference to very supportive trend also beyond the Q1. I haven't seen data so far, if you can share a little bit what's going on. Yeah. On the Serbian part, I'd say that it already reflects, it's all run rated. I should just assume that it's already run rated in Q1. For the second question, We have to wait for ADM data that comes out. I would not, you know, there's nothing surprising in the information. I think we will continue to see, we'll continue to see very, very solid volume growth throughout April. Very encouraging results already in May. Okay. Today. Thank you. The next question comes from Pravin Gondhale with Barclays. Please go ahead. Hello. Good morning. Thanks for taking my questions. Firstly, can you chat about the gaming franchise EBITDA margins driver this year? I mean, EBITDA margins were really strong in Q1 this year. What are your sort of outlook for rest of the year from here? Secondly, any update on retail concession tender you have to share? Thank you. Take the first one. On the gaming franchise, it's two impacts. One is the impact of the distribution and sourcing that improves our margins. As you know, we've continued to carry out that activity throughout 2025 and in early 2026. You see the benefit of that. There's also an element of timing of costs. You know, when you budget for the year, there's some costs may move between quarters, and this quarter has been a bit lighter on costs. You should assume that on the margin level, we'll continue to see at margin levels between 23% and 24%. Yeah. Pravin, I'll take the one on the retail concession. No updates compared to last time. As you know, there is a very solid framework which has been prepared by the regulator and, you know, but it's very hard to say if it's gonna be approved and when it's gonna be approved, as you know, you need the agreement with the regions in the end. You know, I think everybody's highly committed to that. You know, very hard to make forecasts. What we can say is basically two things. It's very robust, balanced, and constructive framework, as you all know. Second point, you'll need in any case, time to implement that and to execute upon that, because really it's a complicated process, so it takes time. The framework is there, and it's very good. Thank you. The next question comes from Chiara Pampurini with Intermonte. Please go ahead. Thank you. Good morning. I got a question about bolt-on acquisition. You said the proceeds of new bond issued are also for bolt-on M&A. My question is if you have selected some target, are you seeing some target or the other than Bgame? About Bgame, if you can share with us the market share gain you expect from this acquisition. If the operation was similar to that of Sportbet or had another structure. Thank you. I mean, when we talk about bolt-ons, we have an active pipeline that we continue to work on across the different segments. We look at gaming franchise, sports franchise, as well as online. That has, that has not changed in the sense that, as you can imagine, we won't have capacity to buy more than EUR 350 million of bolt-ons. It's, you know, we're talking about tens of millions that we can actually implement in maintaining price discipline. This is basically in continuity with the bolt-on activity that we've been carrying out for the last few years, sorry. With regards to Bg ame, it's around 0.7% of market share. Thanks. Thank you. The next question is from Andrea Bonfà of Banca Akros. Please go ahead. Hello. Good afternoon to everybody. I got just one clarification on your EBITDA guidance. Does it implicitly assume that in order to reach the top part of the EBITDA, that you count on a payout which will be lower than your you've been budgeting for in order to compensate the Q1 negative payout, or you're counting more on the mix side or on some lower cost side? Thank you very much. Hi. listen, it's a combination of both really. I would say, you know, we have faster top line growth that puts us at the high end of the guidance, as we said, we said earlier. Also, some better cost efficiencies as well as we're reaping some of the benefits of the some operating leverage as well. Okay. Thank you very much. The next question is from Richard Stuber of Deutsche Bank. Please go ahead. Thank you. Good morning. Just two for me. First, just a clarification again on your guidance. I think you've guided to the top of the EBITDA range of EUR 940 million-EUR 980 million. Is it fair to assume that you're also sort of guiding to the top end of your revenue range as well, the EUR 2.390 billion-EUR 2.460 billion? My second question is on the share buyback. I think you did EUR 56 million in the first quarter, so you're guiding towards about EUR 700 million over the next two years. Could you give us some sort of guidance in terms of how quickly that will ramp up? Any sort of guidance in terms of what sort of buyback you expect to do in the next few quarters? Thank you. Sure. Listen, we're comfortable around the EBITDA guidance at the high end. On the revenue side, we'll see. Depends on ultimately where we will, where we'll end up, because if at an EBITDA you have the confluence of both revenue growth as well as operating leverage and cost efficiencies. So for now we just maintain the high end of the EBITDA guidance and not a revenue guidance. For the buyback, we will do less than half this year, and more than half next year. Great. Thank you. The next question is from Andrew Tam with the Rothschild & Co Redburn. Please go ahead. Hi, good morning. Thanks for taking my question. You included Sportbet and Bgame in your market share statistics. Can I just clarify whether those are fully consolidated into your revenue and EBITDA? If not, if you did fully consolidate that, what that would add to your revenue and EBITDA growth? Thanks. Sure. We consolidated them in the market share. We don't, you know, we will start consolidating them at some point. It's for now, they're not in. I would say, like, if you look at the impact that it has on our EBITDA growth, it's at this point, I would say it's not material. Okay. Thank you. Okay. Operator, I think we are, we are done with the questions, so we can close the call.