Good morning, everyone, and thank you for joining the Esprinet Group Q1 2025 results presentation call. I'm Giulia Perfetti, Investor Relations and Sustainability Manager of Esprinet, and with me is Alessandro Cattani, CEO of the Group. Before going into the details, please note this webinar is being recorded, and after the call, the podcast will be posted on the Esprinet website in the Investor section together with the presentation. During the speech, your lines will be on listen-only mode, but at the end, there will be a Q&A session. Please note again that this presentation contains forward-looking statements, so I would like to draw your attention to the regulation note on page two regarding the information contained within the document. I will now turn the call over to Alessandro to present and comment with you the Q1 2025 results. Thanks, Giulia. Hi, everybody, and welcome to this new presentation for our Q1 2025 results. Let's jump into the numbers. The highlights of the quarter start with one positive piece of news. Sales performance was pretty positive for the Group, and this is confirming our positioning in the key markets where we operate. What is even more interesting is the fact that the Q1 data, market-wise, confirmed that the overall ICT spending environment is in good shape. We have recorded and reconfirmed the recovery in consumer demand, the return of growth of the PC segment, and the excellent performance of the market in the solution segment. Even more noteworthy is the performance of the Iberian Peninsula, where last year we recorded a minus 12% market-wise, and this year we have sharp growth, high double digits. Things are moving on pretty well. We grew in all regions and essentially in all product and customer service. We'd like to draw your attention on V-Valley, our value-added distribution branch, and Zeliatech, our green tech distribution branch, which respectively grew 12% and 16% against last year. As you probably know, we have embarked into a multi-year transition from a volume distributor into a value-add distributor, and the numbers in this area, both at the revenue as well as profitability level performance, are pretty good. We are transitioning, and therefore there's still quite a drag on our numbers from the volume numbers, the area distributed under the brand Esprinet. So screens, PC, smartphones, and devices, more or less everything else, consumer electronics, accessories, and printing devices. Gross profit was up 2% against Q1 2024, with a gross profit margin of 5.65%. The challenging portion of our numbers is at the EBITDA level, a bit adjusted and a bit of the same. There is no adjustment, 10.8%, and that was impacted by the high growth of our G&As. I will come back later on with more color on what is happening in the cost section. There is a huge impact of inflation on the EBITDA as well as EBITDA margins linked to, on one side, collective bargaining agreements that have been raised quite sharply in the second part of last year. This first part of the year, and definitely first quarter, is impacted by this year-on-year inflation on wages. There are also indexed costs on our rents that have been converted into both depreciation and financial charges according to the IFRS 16 accounting principle. We are experiencing a lot of pressure in that area. We have also had some seasonality in our cost structure, but I'll come to that in a moment. Cash conversion cycle is pretty much stable at 24 days, two days compared to Q4 2024, but that's mostly seasonal and unchanged compared to Q1 last year. Therefore, there's, as usual, a sharp increase in the net financial position of Q1 against the end of the year. Return on capital employed is unchanged against March last year. Looking forward, data for the market as of April, preliminary data are pretty good. Italy apparently market-wise grew 1.6%, and Spain 4.5% and 4.6%, and Portugal double digit. We have recorded solid growth, really solid growth. This will be a sort of a theme, a narration that we will have probably during the rest of the presentation in the year. Let's move to the sales evolution, and let's comment on this. We continue to execute the business strategy well in terms of volumes as well as gross profit margin. Portugal, after a tough year of restructuring, is back on growth, profitable growth this time, having shed a portion of low margin and high working capital absorption businesses. Morocco is still outgrowing the market. Italy is flatish in terms of market share, and Spain is down in terms of market share against the market, but essentially because of the smartphone performance. Without smartphones, we would have grown more or less in line with the market. You see down on solution and services and green tech. We do not have the market split into the two areas, but as you can see, we are growing in line with the market. What we are seeing in the market is a market that is recovering, albeit a very, very challenging and confusing macro environment. The expectations for the year are still pretty good in terms of market performance and of our performance within the market. What is challenging is the inflationary environment we are dealing with and the unpredictability of the market, which is creating a number of extraordinary pressures to our vendors. They do not know how to allocate their budgets across the world, and so there is a disproportionate pressure on sending products to Europe. We are fighting a hard war to predict the market and keep the working capital at bay. The unpredictability is absolutely outstanding, incredible. Just to give a figure, we recorded a high double-digit decline in February revenue-wise, followed by high double-digit growth in March. It's really tough for the channel to forecast what's happening and therefore manage what is already difficult in normal times to manage our working capital. That's the thing. That's a bad thing, but also a good thing because having a healthy environment and having a sales and marketing strategy that is performing well is good news. We have to work internally on addressing this inflation and the working capital issues. This is something where we feel more confident we will be able to do it because it's part of our DNA. We'll see it in a second. Let's look at three pillars or three dimensions. Esprinet, that means volume distribution, PC and smartphones in the screens area, devices, so consumer electronics and printing and accessories. Then V-Valley, value-add distribution solutions, server storage, networking, software, cloud, cybersecurity, and services. Then the green technologies distributed by Zeliatech. Revenue-wise, as you can see, we have pretty solid growth across the line. The EBITDA adjusted is affected mostly by the higher weight of the fixed cost on revenues, which drag on all product lines. Gross profit-wise, all the lines of businesses grew with the only exception of devices, which keep being extremely challenged, especially in the TVs as well as white goods area. Everything else grew in terms of gross profit margin. Even though there was a higher level of cost associated to the business, you can see that there was a pretty, pretty good performance. Take green tech, for instance, Zeliatech, they even grew against the first quarter last year. Zeliatech has a very peculiar distribution of gross profit performance across the year. There's a lot of so-called back-end margin that is linked to volumes, which is, from an accounting principle perspective, accrued only when we have 100% certainty of getting them. That normally happens either in Q3 or in Q4. Like for like, we are growing in terms of gross profit pretty healthily, considering that they had to absorb, as the rest of the businesses, quite a big amount of costs. In devices, we also have our own brands. Our own brands run a budget of advertising, and we had a concentration of costs in the first quarter. Q1 is also burned with a disproportionate amount of advertising cost compared to the rest of the year. What I can say is we are in, as of Q3, we are above budget in terms of performance because of this seasonality. Okay, if we go to the P&L summary and we dig into the cost structure, we see that the gross profit was down essentially nine basis points, mostly linked to mix and especially to the lower gross profit margin in devices. This is particularly noteworthy because we have been using more factoring, so there were more factoring costs booked into gross profit, even if the factoring cost percentage-wise were down because of lower interest rates. On the other side, we had another big impact of inflation on freights, especially in Italy. Although we had all these impacts, the big net effect on gross profit margins was essentially related to the different product customer mix. As I said before, all product lines with the only exception of devices, and in devices, mostly linked to TVs and white goods, were up in terms of gross profit. SG&A. SG&A is impacted mostly by a sharp growth of our personnel costs linked to these collective bargaining agreements increases that were active since Q2 last year. We had the advertising expenses on our own brands, which I mentioned before. We had some higher impact of variable costs on sales. We grew sales, so there's a little bit of impact also on variable costs. Variable costs account for roughly 50 basis points on revenues. We had to bear costs linked to regulations, ESG regulations. We also had to beef up our cybersecurity costs. We're starting to deal with certain artificial intelligence projects, mostly aimed at improving productivity. We're now going live in Q2 with some of these activities, which should bring results during the course of the year. As you can see, we have roughly 34 basis points of higher G&A on sales, and that is reflected mostly on the lower percentage of EBITDA. In terms of EBIT, we have the higher depreciation of the right of use of the new warehouse in Tortona, which was fully operational in terms of cost since Q2 last year. We bear also here the higher impact of depreciation linked to the reevaluation of the rents that we pay linked to inflation. In terms of net financial expenses, you see the higher impact of IFRS 16. This is partly linked to the cost of the Tortona logistic hub in Italy, as well as the level of utilization of, sorry, the level of higher rents that I mentioned before linked to inflation. As per the other financial income and expenses, interest rates started to decrease. We will probably see improvements during the course of the year. We have a positive effect linked to short-term financing, but we have also a bunch of mid and long-term financing, which expired and progressively is renewed at higher levels of cost. Here we had essentially higher costs because we used a bit more of average working capital during the quarter. We had gains on foreign exchange against losses of last year. Income taxes are substantially unchanged. As long as there is a different mix and weight of the different companies, the nominal group rate is higher. That is for the P&L. If we go into balance sheet, here we can see the performance in terms of working capital. There are basically two effects. One is linked to inventory. We had a higher inventory against last year. We are facing a monumental pressure from all vendors to ship products. They are convinced that the market will absorb them. There is an enormous question mark on where exactly and when. I mentioned before in Q1, February was down double digit, March was up high double digit. It is very difficult to forecast. We are trying to balance the situation with our suppliers. We are also having a different mix with more sales in the value spaces or value-add, where we normally run lower levels of inventory and so lower levels of financing from vendors. We are in the middle of a major and ambitious project to completely redesign our inventory planning methodologies. We have trained all the people in our group, more than 200 people in purchases. We are working with a consulting firm. We are buying new software to work on working capital management. We expect working capital management metrics to improve during the year, albeit the variability that we are experiencing in the market. We have grown in volumes, revenues in the retailer space, and we have increased our factoring programs accordingly. If you look at the numbers, here we go back to 2018 in terms of a graph. You see clearly the evolution in time. The level of inventory was down during the pandemic years, then was up. We are basically back to around 2018 with a very different mix. We have got very high support from vendors that moved from 55 to close to 90 days in terms of payment terms. We had to bear higher DSOs because moving towards value-add distribution over there, so far we're not being able to factor receivables as we did and as we are doing with the consumer portion of our sales. If you look at the following slide, the quarter-end metrics, you see the high variability. We're back to 37 days against 26 of last year, 41 of Q3. Mostly linked, as you can see, to partly DSOs and lower support from vendors mostly linked to product mix. This eventually impacts on our return on capital employed, which is back to the pre-pandemic period. We're working on redesigning, as I said, we began last part of last year, redesigning completely the demand planning processes and the interaction with vendors. With the new distribution setup, we have more skew towards value-add distribution. We think we need to change the dynamics, and this will hopefully bring good results in time. Now let's focus on what's happening in the future in our view. First and foremost, the backdrop. We already discussed about what's happening. Even if there's some major uncertainty linked to well-known American policies, both we and the sector analysts look at a future which we think should be good. There's been no fundamental changes in the overall structure of the industry, and we all remain pretty positive for the current year. As a matter of fact, the performance of the market of the first three months and our performance in the market in the first three months, as well as the preliminary figures of April and what we're seeing, by the way, in May, all point in the same direction. The market looks good, extremely variable, unpredictable, but trend line is very positive. That is driven by the same things which keep on being reconfirmed time and again. We have seen and we keep on expecting good growth in the PC segment, where we have the refresher cycle after the pandemic, and we have also the Windows 10 end of life. We have witnessed a recovery of consumer demand, which for our volume distribution portion, which is still huge, it's a good point. More importantly, investment by companies and governments in the digitalization of their processes, the investments in cybersecurity, the first projects in artificial intelligence, they are all running well, and analysts keep on estimating low or mid single-digit growth for the current year for the market. Things are moving in that direction. What is about pricing policies from vendors? We're not impacted by tariffs, but actually nobody really knows what is happening with tariffs. They keep on going up and down. Anyhow, assuming that there will still be a tariff war, this is not impacting us at all directly because almost nothing is really manufactured in the U.S. There are very, very few exceptions, supercomputers, for example. The vast majority, if not everything that we distribute, although sold by American companies, is manufactured and shipped by their Far East or Eastern Europe subsidiaries. No impact on tariffs. Unless component cost increases over time, Apple apparently is thinking about a price increase, which is not really linked to tariffs. It's mostly linked to the components costs. The real question mark is whether there will be a recession or not, or a slowdown, if not a recession, a slowdown in growth. That is an indirect effect of the incredible volatility and uncertainty in the market. So far, consumers are still spending. Most of our customers are telling us that the demand from their end users, companies in this case, is still pretty solid, even if, of course, everybody is extremely worried. Those companies that are either heavily reliant on exports to the U.S. or are invested in the U.S. have no clue whatsoever what to do in the future. That could be a drag mid-long term on overall demand, but not in a sense a result of the IT sector as such, but more broadly an impact on the economy. The data for April, as I mentioned before, are pretty positive, and we have recorded very solid growth. We are seeing a sort of schizophrenic behavior in our group. We're having top-line and gross profit margins that are performing pretty healthily in a reasonably good environment, which is still forecasted to be pretty solid and growing. We have this uncertainty impacting the behavior of suppliers on demand and therefore on working capital planning on one side. On the other side, we have inflation that we are addressing. That's what drove our 2025 group guidance. If we split again our activities within the three branches of our group, we have the Esprinet segment, so screens and devices, where our focus is on improving first and foremost working capital with all the big projects that we have in place to improve the situation. We are in active discussions also with vendors to have them share the burden of this uncertainty and not trying to push it down the line and therefore on us. We keep on working on optimization of our cost structure. It's already streamlined, but we keep redirecting people from Esprinet to V-Valley or Zeliatech whenever and wherever is possible. There are a number of AI tools that we're delivering into operation, moving into operation that hopefully should address certain activities that are semi-manual and turn them to a more static structure. The V-Valley segment, so solution and services, here we're hitting on all cylinders, and our focus here is getting new distribution agreements, growing market share, possibly also targeting acquisition in either geographies already covered or new regions. We keep on being engaged in discussions. There is a lot of uncertainty, so we are really cautious on where we move, but we see opportunities of growth. Zeliatech, the green tech segment, is advancing in its accelerated growth. We're sizing market opportunities, and we're looking at expansion also through acquisitions. Zeliatech is definitely focused at expansion not only in Italy, but out of Italy, of course. We have Spain, Portugal, where we need to move as soon as possible, and hopefully other regions of Europe. The real big point that drove us to issue a guidance, which we consider in brackets prudent, cautious, is the fact that we have this very uncertain geopolitical and macroeconomic scenario. Things are moving well, but we do not really understand what is going to happen. It could turn suddenly to an excellent year if wars stop and the tariff wars subside and new agreements are reached and stability is back on the table of decision makers among our suppliers, our customers, and the end user market especially, or it could still be a challenging environment. We are faced with a challenge on absorbing the inflation costs. But here, let's say cost management is part of our core competence. I think we will be able to do a good job in the coming month. We are redesigning working capital and having also a decrease in interest rates. We should be having improvements during the course of the year. For this reason, we have provided cautious guidance between EUR 63 million and EUR 71 million compared to EBITDA adjusted compared to EUR 69.5 million of last year. Within these targets, we have strong objectives of both cost optimization and definitely improvement of working capital. We really are focused 100% on this area. That is basically where we stand. Thanks, everybody, for listening to this presentation, and let's start with the Q&A session. Giulia, up to you. Thank you, Alessandro. Yes, we can start with the Q&A session. Let me remind that to ask questions, you should kindly book your speech and then unmute your microphone. First question from Mr. Store. Mr. Store, please go ahead. Thanks, Giulia, for taking my two questions. The first one is on your guidance. Basically, I understand that the picture on revenues is very much unpredictable at this time, but on the other end, we are probably much more control on your cost. If I'm not wrong, the additional, let's say, below gross profit cost, thank you, one, were EUR 5 million. What is embedded in your guidance for the full year on this, let's say, between gross profit and EBITDA cost? The second question is on Q1 results, the performance of Spain, good rebound, but we are still well below Q1 2023. And I was wondering the reason for that. You mentioned weakness on smartphone. Is just something related to this product category, or is there anything else we should be aware of? Thank you. Yes. Thanks. On Spain, it's mostly smartphone. We have been working on reducing our dependency on especially Chinese smartphone manufacturers. We had very bad working capital in those areas, and we sharply reduced our exposure to those brands. We had less market share on Apple as well, mostly linked to market decisions that we took because we are pushing our operations more into the value-add space, slowly balancing the two components, but having working capital in mind, return on capital employed essentially in mind. On Spain, it's mostly a smartphone situation. We are really doing fine on the other areas. In terms of guidance, cost or gross profit, we are forecasting growth in terms of revenues and gross profit for this year. We have embedded a cost inflation. Some of that has already been there during Q1, and there will be some other during the other quarters, less so we expect. The big question mark is how much in terms of higher gross profit we will bring home. Because from a competitive standpoint, we are really well positioned. Gross profit margins are pretty solid. They actually grew during Q1. If you look at our gross profit margin now and you compare it to the gross profit margin five years ago, we are definitely and significantly up. The big uncertainty is, will we be able to get the market share that we have in mind in a healthier or less healthier environment? That is the big question mark. If the market will ultimately be better than what we have forecasted in our midpoint, and our midpoint projections are not forecasting a particularly high growth of our revenues, then we will probably trend towards the upper portion. If the market will be much better, things could be even better. In this moment, any forecast on the performance of the market is complicated. It is complicated. We prefer to be cautious and hopefully to give good news during the course of the year rather than be bullish, especially after a challenging quarter, especially in terms of costs and risking having to bear the, let's say, pressure on us now and then even complaints later on because we were too bullish. That is basically where we stand. Thank you. Welcome. Mr. Paladino, up to you for your questions. Please go ahead. Remember to unmute. Thank you for the presentation. I have two questions. The first one is related to the— Mr. Paladino. Sorry. Sorry. Maybe you can hear me better now? Yes. Yes. Now, yes. Okay. Sorry. Yeah. Thank you for the presentation. I have two questions. The first one is regarding the devices segment. We saw a decline of 6% with negative EBITDA margin. I was wondering, when do you expect volume stabilization or margin improvement, if there will be? The second one is related with the first one. Maybe I did not catch it because you were talking about the role of your own brand strategy and seasonal investment in advertising, but maybe can you clarify the drivers specific to this cost impact in the devices segment? Thank you. Yes. Devices is made up of two big areas: consumer electronics, excluding smartphones that are recorded in screens, and so TVs, smartphones, audio or video products in general, gaming, and printing, printing and PC accessories. Printing is flattish in terms of sales. Actually, we outgrew the market. We got market share there, but it is a flat, rather declining category. Margins are pretty stable. The accessories, we did well. It is a market that is pretty unpredictable. Sometimes there are higher volumes and lower ones. The real impact is on consumer electronics. Consumer electronics is made up of two areas. The vast majority is what we sell of standard brands. I do not know, Samsung just to mention one, or our own brands. The performance of TVs and white goods in the market has not been good so far. We have underperformed also because the conditions in terms of working capital and profitability are not really good. It is hard to turn them into really profitable areas. We are in active discussions with most vendors to see if we can improve the overall situation of profitability and working capital management, or if we have to progressively withdraw from certain areas. I do not expect, frankly speaking, devices to have sharp increases in volumes unless these negotiations end up well or unless there is a particularly good surprise in the market, which, frankly speaking, in this moment, we do not really see. Margin-wise, the situation will stabilize gross margin-wise once we have a stable and defined set of markets that we will address, a combination of vendors, products, and customers. As for the advertising, it is 100% linked to our own brands. Our own brands, Celly, Nilox, Muitomas, we import from China and with very high gross profit margins. We're talking about high double digits. But then we bear all the costs of being a manufacturer. So we bear, among others, the cost of advertising. Advertising costs are a significant portion of the margin. I could say that we are talking about a few million euros per year. We had last year advertising cost in Q1 of roughly EUR 1.2 million. We overshooted with advertising in Q1 this year, and we had closer to EUR 2 million. Normally, these costs spread more or less equally across the year, actually second part of the year a little bit less. We anticipated to the first portion of the year advertising cost to accelerate growth in this product segment, which is having very high gross profit margins is very sensitive to volumes. If volumes grow, this can contribute significantly. We hope that during the course of this year, they will add value. Celly is performing extremely well. It's making a good profit. It's Nilox, which is Nilox Sport in particular, which is still a challenge because it's still heavily reliant on e-bikes, and the e-bike market has been a disaster across the board for everybody. That is why a portion of the drag on the devices margin is linked to that area. Thank you very much. Question? Oh, sorry. Okay. A A question from Mr. Ibalde. Mr. Ibalde, I give you the floor. Thank you. Good morning, Alessandro. Good morning, everyone. A question, Alessandro, about the inventories. I've seen inventories going up sharply compared to the end of first quarter 2024. You said there was a lot of pressure from the vendors. In an environment such as such a stable, why didn't you resist more increasing inventories? You were already in a situation where you had to bring down inventories following higher sales. The expectation was higher reduction of inventories through higher sales because the market was expected to recover. Instead, we are seeing an increase of inventories. In fact, the number, the day of products is back to 24 from 2022. I would like to understand what's behind what you said before, the pressure from vendors. The second question is, in the U.S., most of the big players like Apple, HP are facing a lot of cost increase because of the import price from China. It's not to be 140%, but it's going to be around 40%. Apple alone is moving production to India. It is very possible that they say that they will increase prices in the U.S. in the following months. What do you expect? Do you expect now that the selling price of the U.S. vendors will increase going into the second half of the year or not? These are the two main questions. Thank you. Thank you, Luca. On prices, we have asked all major vendors. I had discussions at either European or worldwide at quarter level with all our major vendors. The answer is essentially no. They will not raise prices in Europe. The only notable exception is Apple, which is considering price increases not only in Europe, everywhere, but apparently mostly because they claim they had higher manufacturing and component costs. Here is a technical aspect. The products are all manufactured in either China or other Far East countries and assembled, some of them, in either Eastern Europe or in Mexico. The tariff is an issue for the American market. For what we know, there has already been an increase in end-user pricing for the American consumers. The worry we had is, will the vendors raise prices less than needed in the U.S. and compensate this loss of margin in the U.S., raising prices in other regions of Europe? Apparently, nobody's doing that because the first one that is doing this will be outpriced in Europe or in other markets and not the U.S. Nobody's doing that. They're all raising prices and transferring more or less entirely the cost of tariffs into pricing just for the American consumers. That's what we have heard. As a matter of fact, that's what we have witnessed so far. By the way, it's something we will see in time whether there will be still tariffs or not. That's a big question mark. Anyhow, the impact on tariffs out of the U.S. is negligible so far, again, for this specific reason. Nothing is really manufactured in the U.S. It's sold by U.S. companies through their overseas subsidiaries and manufactured by third parties outside of the U.S. So on prices, we don't see this. Will it happen? Yes or no? As a matter of fact, given the system of pricing of a distributor in which we get a discount on the suggested end-user list price and we sell with a discount on a suggested end-user list price, any price increase, if volumes stay the same, for us is an opportunity of having higher revenues without having higher costs because our costs are essentially linked to quantities. The big question mark, if they raise the prices, which they are not doing so far, is whether demand in terms of quantities would stay the same or not. That is an unknown. It is something theoretical because nobody is doing it so far. Inventory is a more nuanced point. We have basically two areas, one which we call vendor-driven and one that we call company-driven. We have sales that are mostly spread on multiple customers and where the ultimate decision maker on whether to buy 150 or 150 units of a specific product is the distributor. Over there, we are working with improved techniques, and we're not really measuring the increases in volumes. Then there's the so-called vendor-driven, so-called by us, vendor-driven. That means large deals, especially in the retail space, but also government and sometimes special bids on large end users. Over here, you sit with the vendor, and the vendor says, "I need to bring this product into the market. Are you playing with me? Yes or no?" Here, we are essentially making a trade-off, and we're asking the vendor, "If we raise our inventory, you have to finance us more." That's the challenge. The point is, how much can we resist? How much can we accelerate on the sellout? Those are the decisions, more structural decisions that we are taking and that are behind also our guidance, which is indirectly affected by decisions that we are taking in the volumes that we will make in this vendor-driven, whether we will play this game or not, will influence the level of revenues and profitability and the level of working capital. We are working on this trade-off, and we have not yet final answers from all vendors and final decisions taken on all vendors by our side. It is a pretty complex equation, and we are working on that. We are confident during the course of the year, we will have improvements. But this variability in the expected volumes is not happening because we have these vendors that are, in some cases, really sort of, I would not say hysterical, but really troubled because they have global allocations where they have the American volumes that are a tremendous question mark. They are trying to find ways to achieve their targets by pushing in other regions. It is a big discussion ongoing. Ultimately, I think we will have a good result, but short term, we have rough seas to sail. Alessandro, thank you very much. Clear answer. Just one follow-up on the vendors' pressure on new products they want to sell. When you say they will allow you better financing, is it only financing? It means that you can pay longer pay time, or is it also a thing that if you do not sell, you can give back the goods you do not sell? No, giving back products is something that sometimes happens, but pretty seldom because otherwise, vendors would incur into issues with their revenue recognition. What they do when there is a pile-up of inventory, and they have done it with the industry, not only with us, multiple times, they put a lot of money on the table to discount and let the products go. That is the way they fix this problem. That is the reason why they are also so challenged because we are working with them on forecasts, and we say be cautious because if you overshoot and then the market slows down, then you will have to spend a fortune as you did in 2022 and 2023 to clean up the inventory of your partners. There is this big discussion ongoing. Some of them prefer to be more cautious, others are more aggressive. We're evaluating also on the basis of who's giving us the best kind of protection in terms of payment terms, margins, support in different ways. Based on that, we're making our decisions of allocation. Okay. Thank you very much. You're welcome. Mr. Nagyi, a question from you. Please, up to you. Hello everyone. Thanks for the presentation. Just two quick questions from my side. The first one is on the cost structure. We have seen an increase in SG&A costs that, however, are expected to normalize over the remaining part of the year as the impact from the increase in collective bargaining agreements started already in April 2024. To this point, it would be appropriate to consider that the Q1 figures could be a sort of proxy for the full year rate, assuming, I don't know, roughly 85% of these costs are fixed costs. The second one is on the revenue trends. You have mentioned about an increase in unpredictability. However, the underlying trend remains positive. In terms of business divisions, might we assume the organic growth to remain similar to what we have seen in Q1, for example, for Zeliatech and the V-Valley divisions that showed, again, a double-digit year-on-year growth? Thanks. Hello. On cost structure, as I mentioned, our variable cost on revenues are roughly 50 basis points. Then we have advertising, and I mentioned the number, and the rest is fixed cost. On fixed costs, year-on-year comparison, we think we will do better in time, but with these three numbers that I gave, I think you can work out the model. On the predictability, we have not released the figures on revenues, but the general expectation is that on Zeliatech as well as V-Valley, we are seeing a pretty—on V-Valley, we are seeing and forecasting a pretty vibrant market, and our target is to outgrow the market at least a little bit. We will see if it will be a little bit, a lot, or whatever. On Zeliatech, the market is—so far, we are in Italy alone. It is a more muted situation. Here we have both the, let's say, industrial, commercial, and industrial, as well as the residential market for solar panel installations. The residential is more challenged. It is heavily dependent on government incentives. The commercial is pretty healthier. Here, we are trying to outgrow the market, and we are outgrowing the market. Here, the plan is to accelerate by moving also in other nations, not only staying in Italy. The market here is pretty much European. With Zeliatech, in time, we need to be a European player and not an Italian one. That is what we have forecasted. That is for V-Valley and Zeliatech. The volumes are linked to Esprinet. Here we have PCs that are forecasted to grow pretty well, and we are outgrowing the market, by the way. The big question mark is around smartphones. We have walked away from most of the Chinese brands. Which portion of the market will be taken by Apple, Samsung, Motorola, and others? Which portion by the Chinese vendors? Unless we find good agreements with Chinese vendors, which is always an opportunity. Past experiences were not successful, very little margin, and ridiculous absorption of working capital. It all boils down in this area to devices performance. As I said before, I do not expect particularly good performance of the consumer electronics market where we are working, not because the market is not doing well, but because we are not getting the right return on capital employed in this area. Unless we fix it, we will have sluggish, if not negative, performance in terms of top-line growth here, mostly because we are walking away from these businesses. All in all, the market is difficult to predict. There are a couple of areas which are pretty solid in the view of everybody: PC performance and cybersecurity, and to a lesser extent, software. Those are solid areas. Consumer electronics, I do not think it would be a great area of growth. Zeliatech, we are growing aggressively, and then there will be market share growth from our side. We are doing pretty well, pretty well in Spain, in Italy. We're growing, especially in terms of profitability, in Africa as well. During the course of the year, if the market stays healthy, we should have a good top-line performance. If the market overshoots because the situation improves, we could have good news. Otherwise, we have tried to prepare the market today and swallow the bitter pill today with a lower guidance in case the market will turn more sour in time. That's more or less the idea. Thank you, very helpful. You're welcome. Okay. There are no more questions, so we can end the call. Thank you for participating, and see you next time. Thanks, everybody.