Ladies and gentlemen, welcome to Pirelli's conference call, in which Pirelli top management will present the company's first half 2024 financial results. A live webcast of the event and the presentation slides are available in the Investor Relations section of the Pirelli website. I remind you that the Q&A session will follow after the presentation. Now, I would like to introduce Mr. Marco Tronchetti Provera. Please go ahead, sir. Good evening to all. The result for the first half of 2024 confirm the effectiveness of our strategy. We strengthen our positioning on high value, now 77% of revenues, fully seizing growth opportunities across both channels and markets, and leveraging innovation and brand strength. We've increased profitability among the best in the industry, thanks to the effectiveness of internal levers, price mix, and efficiencies. Finally, we have improved the cash trend compared to the first half of 2023. A careful management of working capital is a result of structural improvements made over time to reduce the impact of external risks. Outlook for full year 2024 is confirmed. We expect a moderated economic growth in 2024. However, geopolitical uncertainties and fears of new international trade tension still persist. High value, our reference market, confirms its resilience, with growth exceeding that of standard by about 7 percentage points. In this scenario, thanks to the implementation of strategic programs, we confirm the guidance indicated last sixth of March, targeting the upper end of profitability range. Now I'll turn the floor over to Mr. Casaluci. Please. Thank you, Mr. Tronchetti, and good evening, everyone. Pirelli closes the first half of 2024 with a solid performance in line with the targets. +4.6% the organic growth of the top line, thanks to a solid commercial performance. EBIT adjusted at EUR 539 million, +4% versus last year, with +15.6% profitability, improving by 0.5 percentage points year-on-year. A net result of EUR 231 million, discounting a non-monetary impact on financial charges of approximately EUR 69 million, connected with a hyperinflation accounting. A negative net financial position of approximately EUR 2.98 billion, in sharp reduction compared to June 2023, in spite of the payment of dividends for EUR 415 million in the last twelve months. EUR 218 million paid in the Q3 of 2023 and related to 2022 fiscal year, and EUR 197 million paid in the Q2 of 2024 and related to 2023 fiscal year. In the first six months of 2024, net cash absorption before dividends was EUR 519 million, in line with the seasonality of the business and including the impact from the acquisition of Hevea-Tec, roughly EUR 23 million. On the sustainability side, we achieved important results that confirm Pirelli's leadership and strong commitment in implementing the plan. People are our priority. In the first six months, we have reduced the frequency index of accidents at work by 35% compared to last year, thanks to actions on prevention and awareness. We launched the Pirelli Manufacturing Excellence program, in which key development plays a central role and will progressively involve all factories. The decarbonization plan continues in line with all expectations. We have reduced our CO2 emissions by 18% compared to the first half of 2023, thanks to our energy efficiency and machinery electrification projects in our factories. The involvement of our suppliers allowed us to gain lifecycle assessments covering 60% of the emissions related to purchased raw materials. By the end of 2024, over 90% of the electricity purchased by the group will be from renewable sources, compared to 80% at the end of 2023. As to product sustainability, in the next few slides, we will comment the latest news introduced at the Tire Cologne 2024 at the Goodwood Festival of Speed, as well as on the introduction of FSC certification in Formula One and cycling. Finally, as part of the Nature program, reducing dependence on water resources is playing a primary role. In the first half of the year, Pirelli recorded a 15% reduction in specific water withdrawal at the group level compared to the first half of 2023. Let us now analyze in detail our operating performance. With our commercial program, we have further strengthened our positioning in the high value segment and overperformed the market in the car 18 inches and above, strengthening on high rim sizes. On innovation, we have increased our original equipment portfolio with approximately 150 new homologations, mainly in the electric vehicle segment and bigger rims. We launched six new products in the car segment, of which one global, the P Zero Winter 2, and five which met specific regional requirements in terms of performance, mileage, and seasonality. On the operations program, we achieved gross benefits worth EUR 71 million, which fully compensate for the inflationary impact. We implemented actions to mitigate the impact of the Red Sea crisis through alternative routes and means of transportation, as well as supplies of raw materials from new South American and African suppliers. Finally, we are working together with our suppliers to guarantee the availability of natural rubber in compliance with the new European Deforestation Regulation. Let us now analyze each program in more detail. We further reinforced our positioning in the high value segment and achieved, in both quarters, +7% growth. More specifically, in the Q2, we overperformed the market. In the original equipment, Pirelli +4% versus market +3%, thanks to the growth of demand in the Asia Pacific region. In the replacement channel, Pirelli +8% versus a market +7%, where we gained shares in the major regions, thanks to the strong pull-through of the original equipment and renewal of product range. Our exposure to the standard segment is being reduced. Volumes of Pirelli cars 17 inches and below, -8%, versus a -1% of the market. We are counting to pursue our strategy based on a higher selectivity in the original equipment channel and growing focus on higher rim sizes in the replacement channel. The reduction of the standard channel was higher in the second versus the Q1. Also, taking into account the weakness of South America, which is one of Pirelli's major standard markets. Overall, in the Q2, our performance was in line with the car tire market, which remained positive +1%, yet with a smaller growth than the Q1, given the weakness of the standard segment I just mentioned. Talking now about our innovation program, we increased the range of our products with a high content of sustainable materials. After P Zero E, the new P Zero Winter 2 has launched, which is the outcome of our collaboration with BMW. This winter tire stands out for its content of natural rubber and recycled materials, which exceeds 50% of the total. It is the first of its category to be awarded with Class A in terms of rolling resistance, which is a fundamental feature for electric vehicles that can therefore save energy and have a longer mileage with a battery charge. Furthermore, our commitment in developing and supplying tires with FSC-certified natural rubber continues. I wish to remind you that this certification confirms that plantations are managed so as to preserve biodiversity and provide benefits to the locals who work in those areas. During the Goodwood Festival of Speed in July, Pirelli announced its collaboration with Jaguar Land Rover to supply tires made of FSC-certified forestry materials on a wide range of luxury cars. This is a new achievement in the collaboration started in 2022, sorry, 2021. In the first half of 2024, FSC-certified tires were introduced in the Formula One Championship, as well as in cycling, with the new P Zero, Pirelli P Zero Race RS. From 2026, 100% of the natural rubber used in the European factories will be FSC-certified. As to connectivity, Pirelli's journey continues. After agreements with McLaren and Audi, Pirelli has developed a new Cyber Tyre solution with Pagani, presented in mid-July, mid-July at the Goodwood Festival of Speed. This opens up a new phase in tire connectivity. For the first time, data collected by a sensor will be integrated directly with the vehicle's control systems to improve performance and safety, depending on the tire fitted. This continuous dialogue between tires and vehicle is made possible by software developed by Pirelli and integrated into the car's electronic control system, representing a major improvement in terms of performance and safety. For example, when the car is fitted with winter tires, the ABS can modulate its action to minimize braking distance. Also, with the semi-slick tires, the stability and traction control systems can take advantage of the increased grip to ensure higher performance. Finally, let's move to the efficiency program. EUR 71 million were achieved in the first half, approximately 50% of the full year target, which fully compensated for inflation. The main contributions come from the product cost projects, more specifically through design-to-cost programs and efficiencies achieved with the virtualization of tire development. SG&A, through the optimization of logistics and supply chain, and the organization project, driving the digitization of internal processes and employee upskilling. Lastly, the manufacturing project is generating, as expected, most of the benefits in the second half of the year as a result of plant automation, curing electrification, and reduction of energy consumption. Now leave the floor to Mr. Bocchio. Thank you, Mr. Casaluci, and good evening. Let's now get into the detail of the financial performance during the first half. Sales amounted to EUR 3.45 billion, +4.6% organic growth, due to a solid commercial performance in both quarters. We recorded a volume growth of 1.8%, in line with a full year target of +1.5% to +2.5%. As already pointed out by Mr. Casaluci, the lesser contribution from volumes in the Q2 discounts the standard weakness, whereas high-value growth was similar to the Q1. The price mix is clearly improving, +2.8% in the first half, above the full year target announced in March of around +2%. This trend was supported by the steady improvement in the product mix and the regional mix, which was especially positive in the Q2 when you consider the temporary weakness of South America. Exchange rates had a negative impact of -4.3% in the first half. However, this trend was more limited in the Q2, -3.7%, mainly discounting the volatility of emerging currencies. In the first half of 2024, the adjusted EBIT amounted to EUR 539 million, up 4.2% year-on-year, with a 15.6% margin. The improvement by 0.5 percentage points, compared with the first half of 2023, is due to internal levers. More in detail, we recorded a positive impact of the commercial performance, volumes plus EUR 24 million, and the price mix, plus EUR 60 million. Efficiencies equal to EUR 71 million, fully offset input cost inflation equal to -EUR 68 million, while the lower cost of raw materials for EUR 36 million contributed to cover the impact of exchange rates, equal to -EUR 62 million. Finally, the amortizations impact was equal to -EUR 14 million, while the other costs impact, -EUR 25 million, was mainly related to marketing, research and development, and inventory reduction. In the Q2, the adjusted EBIT margin was 15.8%, a 0.3 percentage point improvement year-over-year, thanks to the effectiveness of our internal levers. Let's now review the net income trend compared with the first half of 2023. Operating performance, whose dynamics has just been described, improved by EUR 22 million. The non-recurring and restructuring costs and the result from equity participations also improved. Net financial charges discounted the non-monetary impact of forex and hyperinflation. Out of the EUR 176 million net financial charges, approximately EUR 69 million are non-monetary. This phenomenon is due to the misalignment between inflation and exchange rates in high inflation countries. A realignment with our expectation is expected over the course of the year. Finally, the tax reduction for EUR 22 million reflects the Patent Box benefits not included in the first half of 2023. In the first half, the cash flow before dividends was -EUR 519 million, in line with the business seasonality. It improved by approximately EUR 38 million compared with the first semester of 2023, when we exclude the impact of Hevea-Tec acquisition that was worth about EUR 23 million. The net operating cash flow, -EUR 279 million, compared to -EUR 302 million in the first half of 2023, reflects the operating performance, improved compared to last year, investments of EUR 144 million, while it was EUR 124 million in the first half of 2023, mainly going into high value, mix, and quality improvement, and to support the sustainability plan.... The working capital, -EUR 863 million compared to -EUR 876 million, is in line with the business seasonality, and it reflects a careful inventory management with an incidence on sales of 21%, despite the impact of the Red Sea crisis, and the usual seasonality of trade receivables, 14% weight on revenues, and trade payables, 22.5% weight on revenues. In the Q2 of 2024, the net cash flow before dividends was positive by EUR 154 million, basically in line with the Q2 of 2023, when it was EUR 157 million, despite higher investment, EUR 90 million in the Q2 of this year against EUR 70 million in the same period of last year. Finally, it is noticeable the impact of dividend distribution, EUR 197 million in the Q2, while in 2023, dividends were paid in the Q3. As of June 2024, the group's gross debt amounted to EUR 4.16 billion. Considering financial assets of approximately EUR 1.18 billion, the net financial position is equal to approximately EUR 2.98 billion. Liquidity margin amounted to around EUR 2.4 billion, of which EUR 1.5 billion in committed credit lines, not drawn. Our liquidity margin allows us to cover financial debt maturities until Q1 2027. The cost of debt calculated over the last 12 months is 5.29%, mainly discounting the negative impact of euro interest rates compared to the first half of 2023. Lastly, our fixed variable mix remained balanced with approximately 50% of our debt at fixed rate. Sustainable finance accounted for approximately 69% of the group's gross debt. That is 85% when we consider financial debt at holding level. After June thirtieth, a sustainability-linked bond of EUR 600 million has been issued with a 5-year tenor. The notes have a 3.875% coupon and a yield of 3.95%. Demand from investors exceeded 4.6 times the offering. In July, Pirelli used the proceeds of the bond to prepay financial debt with maturities in 2024 and 2025 for the same amount. All the above considered, the liquidity margin on a pro forma basis would cover maturities until Q1 2028. Finally, we are glad to share that in June, Standard & Poor's confirmed our rating to BBB- and improved our outlook from stable to positive, while more recently, Fitch upgraded our credit rating one notch to BBB with stable outlook. I now leave the floor back to Mr. Casaluci. Thank you, Fabio. Thank you, Mr. Bocchio. Let's move on the outlook for 2024. We confirm our expectations on high value to grow mid-single digit. In the replacement channel, growth is being driven by high-value regions. In original equipment, growth is being driven mainly by Asia Pacific. In the standard segment, we are forecasting a decrease in demand, -1%, discounting a greater weakness than expected, both in original equipment, due to a reduction in car production at global level, and in replacement because of weak demand in standard regions. The total full year 2024 car tire market is therefore expected to remain flat year-over-year, with a slight decrease in the second half, -1% versus a +1% of the first half, due to the standard segment, -2% versus a flat first half. On the contrary, high-value trend is positive, with a mid-single-digit growth rate, in line with the first half of the year. In this scenario, we confirm our strategy to gain more share in high-value segment and cap the exposure to the standard. Based on the results achieved in the first half of 2024 and the scenario described, we confirm 2024 targets and expected profitability to be in the upper end of the range, thanks to mix improvement. More in detail, we expect revenues between EUR 6.6 billion and EUR 6.8 billion, volumes up between +1.5% and +2.5%, with high value growing at a mid-single-digit rate, while our exposure to standard keeps on decreasing. Price mix between +2% and 2.5%, and taking advantage from the ongoing improvement of product mix. Forex confirmed between -4% and -3%. Adjusted EBIT margin now expected to reach the upper end of the previous guidance, approximately 15.5%, with the same margin as in the first half of the year. Investments of approximately EUR 400 million, around 6% of revenues, devoted to technological upgrade of our plants, mix improvement, and sustainability. Net cash generation before dividends expected between EUR 500 million and EUR 520 million, thanks to operating performance and efficient working capital management. Net financial position equal to -EUR 1.95 billion, with an expected leverage of approximately 1.3, against the 1.56 in 2023. I now leave the floor to Mr. Tronchetti for the final remarks. Thank you, Mr. Casaluci. The results of the first half and the outlook for the whole year confirm the strength of Pirelli within the tire industry. In a highly volatile external context, we are leveraging on our distinctive characteristics: leadership in high value, a segment which is confirming its growth trend, a strong drive to product and process innovation, an iconic brand, a solid partnership with OEMs, both traditional and innovative, based on our ability to always meet increasingly challenging requirements, and an efficient manufacturing footprint, less exposed to supply chain disruption risks due to our local for local strategy. These characteristics and our business model make us confident in delivering the plan and achieving a better performance than peers. So this ends our presentation, so we may open the Q&A session. Thank you. [Operator's Instructions]. The first question is from Michael Aspinall of Jefferies. Please go ahead. Thanks. Good evening, gentlemen, and everyone on the call. Michael here from Jefferies. Well done on the quarter and higher guidance. Just starting on the new margin guidance, it implies slightly lower margins in 2H versus 1 H. Is there anything specific that would drive that, or is that just allowing some room in the case that raw materials continue to increase or volume softened or something else, for example? Hi, hello. Thank you for the question. I will take this, this question. Raw material for this year have a peculiar trend because we saw in the first half a positive impact. This positive impact of the raw material in the first half compared to previous year was coming from commodities, with some negative impact coming from the Forex side. For the second half of the year, we expect a different trend, both in quarter three and in quarter four, because we expect a negative comparison basis, a negative variance on the commodity side, and this coming mainly from natural rubber and from oil derivatives and butadiene. And on top, there will be, we are expecting still some negative impact on the Forex. Ov erall, we are expecting a full year on the raw material, which is going to be probably slightly negative on the full year base compared to previous year. Okay, great. Thanks for that. One more from me. Factory saturation is at 88%. Should we see that as something that you need to take action to change, or should we see that as there to provide room for growth as high value continues to grow at mid-single digit level? Yes, thank you for the question. Of course, we keep on growing with our high-value capacity in order to be able to catch any possible opportunity of growth in the high value. But just to fix a couple of numbers today, in 2024, our high-value capacity represents roughly 57% of our total... Sorry, 57 million out of 75 of our total capacity. And we always use around 10 million, so thirty- less than 30% of this capacity to produce standard. This is allowing us, from one side, to have always the highest possible saturation of our plants. On the other side, to be ready to catch, also in the short period of time, any further opportunity to grow on the high value, which remains our priority. Thank you. Thank you. The next question is from Monica Bosio of Intesa Sanpaolo. Please go ahead. Good evening, everyone, and thanks for taking my questions. I have three. The first is on China. The car market in China is expected to decrease by 6% in the Q3 and to be flat in the Q4. So I was wondering, the original equipment, China should be negative. I was wondering if you can give us any color on the replacement market trend in China in the second half. And do you expect to further growth in the region, thanks to your customer mix, or should we expect that the market share gains will occur more in USA? Just any color would be useful. My second question is on the dealers situation overall, and mostly in Europe, and especially as for the winter tires. Are your inventories low? And the very third is the price mix drop-through on the year, if you can give any indication on this. Thank you very much. Thank you for the questions, and, I will start from the first one. The Chinese market, I always talk about the high-value market, of course. The Chinese market, in the second half, is expected to slow down compared to the first half, you're right, in the original equipment, but this is mainly due to a less favorable comparison versus last year. And it will anyhow remain positive market, in the range of the, mid-single digit. And also, the high-value market is expected to have, in the second half, a less favorable comparison versus last year, but, remains anyhow, a positive market, while the standard is expected to be negative, in China. We target to gain market share, as we are doing, in the first half. These will remain, our priority. We have so far a good pace of growth in the Chinese market, thanks to our pull-through strategy and also to the enlargement of our distribution network. [Crosstalk]. As far as winter is concerned, so the second question, I have to say that the winter season is a bit early to arrive to a conclusion, of course, because we just started the pre-booking phase, but the first signal are very positive as far as the Pirelli performance. The winter stock was quite low at the beginning of the pre-booking season, thanks to a very good sell-out season in the Q1 in Europe, in winter. T he order collection is moving in the positive directions. That is opening good expectation for the Q3, while the last quarter of the year, as always, it will depend on the weather conditions so it's not possible to have a clear understanding now. The drop-through is expected to remain around 60%, stable during the year. Thank you very much. Thank you. The next question is from Martino De Ambrogi of Equita. Please go ahead. Yeah, thank you. Good evening, everybody. The first is a follow-up on the price mix. Could you split price and mix in Q2 and for the rest of the year? I suppose the increase, let me double-check if I understood correctly, the change in the price mix for the full year, just slightly improved, is essentially because of region slash standard weakness in South America. So this is my first question. You are right. The good performance of the Q2, the 3.3 that we just presented, is based mainly on mix, with a solid performance on the product mix. Which is confirmed from first to Q2, and then is also expected to remain stable in the second half, which is the core of our business model. On top of the usual product mix positive performance, in the Q2, we had the positive contribution coming from the reduction of the standard, mainly driven by South America. We don't expect to have the same positive contribution on the region mix in the second half, because the comparison versus last year will be more favorable in South America. While, of course, we confirm the positive performance on the product mix side, also in the second half. As far as the price is concerned, in the first half, the performance has been more or less stable compared to last year, in both channels. Thank you. Okay, thank you. M y second question is, focusing on the standard tires. Because they are constantly declining in the last four quarters, and the market is going worse than initially expected. So the 7% to 8% return on sales is still achievable for this year? And still on standard, could you provide what is the break-even point in terms of sales, roughly, and the contribution of Russia? Y es, of course, we confirm the profitability on standard that you mentioned. We are not where we would like to be, around the 10%, double-digit profitability, but we will maintain the target for the following two years. And we will accelerate as much as possible the exit from the standard. But that's because it is a volatile segment, is decreasing, and is exposed to the trade down, and the price pressure. Just to give you a number, today in Europe, the 55% of the standard market is in the hands of Tier One and Tier Three brands. So the standard market in Europe is a Tier One market for no more than 45% of the total volume. 10 percentage point below the situation of 2019. So the trade down is there, and that's the reason why we want to exit, and we want to keep the focus on the high-value market, introducing more and more specialties and technologies on our product, and basing our strategy on the innovation and technologies, as always. The weight of Russia. I change the question, and not referring to the break-even point, but constantly declining, but what is the end game for the standard, so the arrival point one day? The arrival point is to remain. But But let's also consider that the definition of standard itself will change in the future. But for the foreseeable future, in the following 2-3 years, we wanted to target no more than 10% of standard in our high-value regions. We are very close to this target, so we still have opportunities to decrease the standard presence. But in North America, Europe, and Asia Pacific, we want to arrive at the weight of, on volume of, 90% in a high value. That's the target. Of course, South America, Russia, are mainly standard markets, so it's a completely different story. In these markets, we in South America target to improve more and more efficiency of our industrial footprint, and to be there in order to catch any opportunity of growth in the high-value markets that will come. The car park of Brazil is accelerating in the direction of the premiumization. This will take time, but the weight of SUV, mainly SUV, is growing year after year, and a lot of investment has been announced by the car makers in the region, mainly in Brazil. W e will remain with our leading position, and we target the double-digit profitability on the region, of course. Thank you. [Crosstalk]. Sorry, Russia? Yes, I was forgetting. Russia, we maintain the same approach. So as we declared, we have completely stopped any kind of investment with the sole exception of HSE. And it, the weight on our result of Russia is below the 4%, around 4%, so it's not meaningful anymore in our total results. And, the saturation of the factory is running around the 70-75%. We manage by cash the company, so we basically generate cash flow to pay salary and suppliers, and we are well-balancing between debt and cash in the country. So that's the way, and we monitor continuously the development of the situation. That's all. Thank you. The next question is from Harry Martin of Bernstein. Please go ahead. Oh, yeah. Hi, good, good evening, everyone. A couple of questions, please. The first one is on your industry outlook. So you say that you expect the premium replacement volumes to grow at mid to high single digits, led by demand in all high-value regions. I noticed from the monthly data that you released, that the North America eighteen-inch and above market was negative in June, at -1%. So do you see that as a one-off, or is there anything else in North America that we just need to keep an eye on? And then the second, the second question is, is really, you know, a longer-term, high-value one. We're clearly in a period where OEM product launches are slowing down, but getting the OE fitments on premium vehicles remains very important for you and competitors to access the very high-value first and second replacements. So my question is, it feels like that dynamic with less production is gonna make competing for those OE fitments even more competitive than ever on premium vehicles. So is there... Should we worry at all about pricing and margins in the OE channel, or do you feel like there's still a lot of discipline in the market? Thank you. Sorry, I lost the second question. The first is, Yeah, can you repeat, please? Okay. Both questions or just the second one? No, no, only the first one is related to the North American market, and the third, the price on the OE is clear. The second? T he final question was a broader question. You know, does the reduction in OE production volumes and the fact that it is still a really, really important part of your strategy give any risk to pricing and margins and rationality in the OE channel? T hank you. So, starting from the first question, North America market, you're right, we do expect a slowdown in the second half of the year, but this is basically due to the comparison versus last year. So there is no measure impacts on the North American market that we are worried about. It's simply a less favorable comparison versus last year. The second half of 2023 was extremely good in North America. While our selective approach on the regional equipment is mainly driven by our evaluation on the integrated profitability of the regional equipment and the replacement. After years and years on this business model, we understood our capability to have the pull-through rate in the replacement channel. W e know, we assume to know the capability of each original equipment project to generate pull-through demand in the aftersales. E very time there is the opportunity to enter in the original equipment business, we try to understand both the profitability of the original equipment, and the expected demand and profitability on the replacement, and we make these integrated evaluation of the business. That's the reason why we decided to accelerate our exit strategy from some synergistic original equipment business, mainly Europe, while we are accelerating our growth in Asia and in North America, mainly driven by EV players and also business with high content of technology, like extended mobility solution, like noise-canceling system solution. This is driving our original equipment strategy. But we don't see margin pressure on the price, on the contrary. Being focused where there is a technology, we try to protect as much as possible the value of our product, because the competition is concentrated on capability to create innovation, technology, and performance instead of pricing. Thank you. Thank you very much. The next question is from Michael Jacks of Bank of America. Please go ahead. Hi, good evening. Thank you for taking my questions, and congrats for the robust set of earnings in a difficult market. On the cost side of the equation, you've done really well on efficiencies, but production inflation was a little bit higher than expected. Could you please share some color on what the main driver was there? Was it mainly due to higher shipping costs due to the Red Sea situation? And how do you expect this to develop in the second half of the year? And then my next question is on Forex. EBIT in Q3 and Q4 last year was very negatively impacted by that. What is your latest expectation for H2 at an EBIT level? And then finally, just on raw mats, just want to confirm, you now expect a net negative raw mat impact, for the year, meaning that the headwind in H2 will more than offset the tailwind in H1. I'm wondering, is this just a planning assumption, or is that based on actual current raw material prices? And finally, if that is the case, are pricing increases a potential consideration, to cover raw mat inflation? Thank you. I will take the questions. So the inflation impact in the, the first half has been of about EUR 68 million, and it was pretty aligned with the, with the expectation, because, at the end of the day, for the full year, we are expecting, an overall, value of about, one hundred and forty, one hundred and, thirty-eight million euro, so pretty aligned with the expectation. The driver of the inflation, were mainly two. The first one is related to labor cost, so with the labor contract negotiation that took place, in the second part of 2023, and now at the beginning of 2024. And the second main offender on the inflation is related to the local logistic cost, not really related to the international transportation, but the local logistic cost. This is due mainly to the labor cost and the impact of gasoline cost on the local transportation. This impact is expected to be pretty stable quarter-over-quarter. So in H1, as I was saying, we had an impact of EUR 68 million negative, and we are expecting a roughly similar impact for the second part of the year. So overall, we are expecting about EUR 140 million of negative impact from inflation on input cost, which is roughly, which will be roughly, compensated by the efficiency program that we have, we have in place. On the second point of your question related to the FX, as you, as you saw, the impact of the FX on the top line in the Q2 has been negative by 3.7%, which was a slight decrease compared with the 4.8% of the Q1 of the year. And this was due to the very high volatility in Latin American currencies, especially from the Argentine peso, which is representing about 3% of the sales of the group. And then given the devaluation of the Russian ruble, partially mitigated by a revaluation, a partial revaluation of the US dollar. For the second part of the year, we are expecting a second half with any impact on the top line, which will be still negative, but better than in the first half. So overall, Forex on the top line of the first half has been -4.3%. What we are expecting for the second half is to be between -2.5% to -3%. So we confirm the range of the guidance for the full year, which is a negative impact between -4% and -3%. I have to say that we are expecting a different trend in this impact between quarter three and quarter four, because we are expecting a quarter three, which is gonna be more aligned with the values that we saw in the first half, while we see, we expect a softening of the negative impact on the effects for quarter, quarter four. Last one was related to the raw materials. On the raw materials? Yes, that's correct. Yes, on the raw materials. Yeah, raw materials. Yeah, the raw material. I was saying previously that we are expecting for the full year, a slightly negative impact on the raw materials. That means that for the first half, we accounted for a positive impact of EUR 36 million, out of which about EUR 55 million coming from the commodity, pure commodity impact, and EUR 18 million coming from the negative impact of the Forex related to the raw material. On the second part of the year, we are expecting commodities impact to be negative, and this negative is related to the trend of the natural rubber, natural rubber on the butadiene, and even on the oil derivatives, because the brand is stable at around, we foresee $84 to 85. Obviously, we are taking into consideration that there is a time lag between the commodity price we see on the market and the impact of these commodities in our cost of goods sold. Usually, depending on the raw material, we have a time lag, which is between 3-5 months. On top of that, we are still expecting a negative impact on the Forex, on the raw material for the second part of the year. A little bit less negative than in the first part, but still negative. Thank you. That's all very clear. Could I just ask you if you could also just please comment on the expected impact of Forex on EBIT, in the second half of the year? Thank you. Sure. The Forex on EBIT. On EBIT, we are expecting a less negative impact compared to the first half. On the first half, we had an impact on EBIT by Forex for about EUR 62 million. While for the second part of the year, we are expecting a lower impact, even considering the fact that on the EBIT, for us, it is a significant impact coming from the Mexican peso. And as you may remember, starting from the end of May, beginning of June, there has been a significant devaluation of the Mexican peso following the election in Mexico. So for the second part of the year, we are expecting still a negative impact, but much less negative than compared to the first half of the year. Thank you very much. The next question is from Akshat Kacker of JP Morgan. Please go ahead. Good evening. Thank you for taking my questions. Two, please. The first one on pricing. If you can just talk about the overall pricing levels on the high-value replacement side of the market, please. One of your competitors recently warned of heavy promotional activities in the US, and they're seeing overall higher pressure on the industry, both in US, US and Europe. So just interested in understanding how confident are you of maintaining that price stability in the market in the second half of the year? And the second question is on your high-value OE business. You grew volumes by 1% in the first half. Could you just talk about how do you see the second half progressing in terms of volume growth and what regions are driving that growth, please? Thank you. T he growth versus the market has been 1 percentage point, so we overperformed the market by 1 percentage point, but... Sorry, percentage point. But the growth on the high value itself was higher. I give you the 7%, right? 7%, yes. That's the growth. And we want—Thank you so much. W e want to target, as we did in the first half, to overperform the market also in the second half. How we will reach this target, we have different strategies region by region, but the core of our business model remains the same. We want to improve more and more the content of technology and innovation of our products, partnering with the most important car makers in the world of premium and prestige all around the world, and leveraging on the pull-through rate. On top of that, we are introducing replacement product lines to match the needs of the different consumers, region by region. For example, in North America, we know that there are customers that look for mileage and all-season products. S ometimes, preferring this choice to the original equipment homologation. That's the reason why we introduced it in North America, a new All Season Plus lines to match these needs. Today, our All Season Plus, both in the Cinturato and Scorpion, are leading the ranking of evaluation of the most important magazines in terms of mileage performance, and this is allowing us to gain market share. Mainly United States, that is one of the most important targets of growth for the coming years. It's not only a question of products, it's also a question of brands, where we are growing in terms of awareness and consideration in United States. Thanks also, not only, but also to the growing popularity of the Formula One, where Pirelli, since 2011, is the sole supplier, and also growing in terms of production capacity and enlargement of our distribution network. As far as price is concerned, we fully know, of course, the promotions of our competitors in the last years, but we have a different strategy. I tried to explain our strategy, so we stay focused on the high-value segment, where there is value and where the technology and the brand of our products make the difference, and that's what we do. Following our leadership in this segment, we try to keep the most efficient strategy in terms of also price power. But that's all. We don't give the press detailed information on the price performance by market. In the future, we can give you the detailed performance of the past months. Thank you so much. Thank you so much for the details. Just a quick clarification. The first question, I was trying to get to your high-value OE growth expectations in the second half? I n the original equipment, in the second half, we expect a performance better than the first half. So all in all, the market is a high-value market, is expected to perform in the second half, the same level of the first half. I would say around 6% to 7% growth of the total market. But while in the first half, we had an overperformance of the replacement, running with a pace of growth of around 9%, while we had a weaker original equipment in the range of 3%. We do expect in the second half to see the two channels more rebalanced, with both channels running more or less with a pace of growth of 6%. This is mainly due to a more favorable comparison, mainly in Europe, where we do expect a recovery of the original equipment, high-value market. And also less favorable comparison, in the replacement channel, mainly due, as we said before, to North America. That's very clear. Thank you. The next question is from Edoardo Spina of HSBC. Please go ahead. Good evening. Thank you for taking my question. The first one is on, if you can remind us, the revenue exposure to winter tires for 2023, and how that was split across the quarters, so we have a better idea what to expect. And the second, questions are on the Cyber Tyre. I actually have three on, on this. First, if I can ask at the moment, the three car models you show, McLaren, Audi, and Pagani, are the only ones with the Cyber Tyre? If not, can you give us an indication for the exposure? The second question is more to understand, why is this product not more popular already with the higher volume car makers? Is that because the technology is not ready? Is it a matter of very high cost? Can we expect significant growth from this at some point in the future? The very last question on this is about the data. Do you get any access to data if you install a Cyber Tyre, either on the aggregated data or specific by vehicle? If not, can you reach this data at some point from the consumer, the car maker, in order to have a better management of the supply chain? Thank you very much. I'll take the question about the winter tires. Looking at the numbers of last year, I can say that, in... On the total, the winter tires accounts for about 11%-12% of the overall net sales and volume of the company. Obviously, there is a significant difference between half one, which is much lower, and the second half of the year, which is much higher. But on average, you may consider between 11% and 12%. Thank you. I will move to the very interesting question on the Cyber Tyre. Thank you so much. We, we trust a lot on this project, and, w-we do understand that we are, despite a lot of investment we did in the last year to develop this technology, we do understand we are still in the introducing phase of the technology. So the technology, the more we become mature, the more we'll be able to penetrate it in the, in the car industry. Of course, we see this technology fitting the prestige and premium segment more than the synergic, which is perfectly aligned with our strategy. We are in the McLaren, the Audi, and the Pagani, but, in 2024, we have been able also to introduce in Tesla, this technology, and so, this is a premium segment. So this is helping to enlarge the presence of the product, and I'm sure you will see in the coming years, maybe also months, an acceleration on the introduction of this technology. Data are different. Data are different, project by project, and this is strictly related to the requirement of the car makers. For some car makers, the cyber technology is useful to improve safety, for example, aquaplaning or braking distance. For others, it's useful to improve service, for example, introducing the concept of predictive maintenance related to the tire wear measurement, and so on. So this is depending on the car maker priorities and the product specification that we define project by project. Thank you. Thank you. T here are no more questions. Can you confirm it? Mr. Tronchetti Provera, there are no more questions registered at this time. Thank you. Thank you very much, and thank you to everybody, and have a good evening. Thank you. Bye-bye. And also, good holidays for the lucky guys that are going on holiday. Yeah. Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your devices. Thank you.