Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Tinexta Q1 2023 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 and 0 on their telephone. At this time, I would like to turn the conference over to Mr. Josef Mastragostino, Chief Investor Relations Officer of Tinexta. Please go ahead, sir. Thank you, operator. Good afternoon and good morning to the folks in the U.S. Thank you for joining Tinexta's Q1 2023 results presentation. Here with me today, Oddone Pozzi, Group CFO. Good afternoon, everybody. As a reminder, all the relevant documentation of the Q1 2023 results can be downloaded from our company website in the Investor Relations section. For the purpose of this call, I will go over the Q1 2023 highlights and updates. Oddone instead will go over the Q1 financial results as well as the business units' performance, providing us with a deep dive. The last part of the call will be dedicated to Q&A. A recording of this conference call will also be available on our company website and it will be posted upon completion of this call. At this point, I will kick it off by turning to page four of the presentation. Let's start by saying that the comparative data for Q1 2022 have been restated in relation to the completion of the identification of the fair values of the assets and liabilities of Forvalue S.p.A., of Financial Consulting Lab S.r.l., CertEurope S.A., and of course, Evalue Innovación. The comparative data for Q1 2022 have also been restated for the reclassification in the results of the discontinued operations of the Credit Information & Management division following binding agreements for the sale subsequently concluded between August 2022 of Innolva and March 2023 of ReValuta, as indicated in our press releases. At this point, you can see that Q1 results were very robust. Revenues came in at over EUR 80 million, roughly EUR 86.1 million, growing 10% versus prior year. EBITDA adjusted came in at EUR 15 million, even more representing is probably EBITDA, which was EUR 13.5 million, growing 17% versus prior year. Net profit was very strong. It accounts in particular from the proceeds of ReValuta, and it came in at close to EUR 40 million for Q1. Net financial position was virtually zero or close to EUR 3.8 million versus the EUR 77.6 million of the fiscal year 2022. Turning to page five. Given that we already commented both on revenue and EBITDA, EBIT came in at growing 25.5% versus prior year at EUR 4.3 million. The net profit of continuing operation grew 57% and posted a EUR 2 million mark. Net profit, as we said, was EUR 40 million, and it was very strong, mainly driven by the capital gain from ReValuta. in terms of adjusted free cash flow of continuing operations, it came in at around EUR 23 million, substantially in line with the prior year. Even more representative is probably the LTM of the adjusted free cash flow of continuing operations, which was very healthy at EUR 50 million. The start of the year was very strong, with the top line growing in all business lines. Digital Trust continues to register strong quarterly growth. Revenues grew close to 12% versus the prior year. EBITDA grew even more around 12.3%. Outstanding was the EBITDA margin, which was 27.4%. Cybersecurity strongly rebounded, growing 14.9% in revenues and even more so in EBITDA, registering an exceptional growth of 79% versus prior year. The EBITDA margin was around 10.2%. Business Innovation grew 6.4% in revenues, and EBITDA came close to EUR 5 million, with a margin around 20.4%. In terms of the most recent events and updates, we remind the market that we completed the signing of the 65% of Ascertia. We will complete the closing very soon. We finalized the transfer of the 95% of ReValuta to CRIF, on March 7, and we completed the closing of the 20% stake in Defense Tech for approximately EUR 25 million. On page six, you see a graphic representation of the most important KPIs of the quarter. Again, most importantly, we think is adjusted free cash flow, was very strong for the quarter at around EUR 23 million. Now, I'll leave it to Oddone to start from page eight. Oddone? Hello. Good afternoon again, everybody. Thank you for joining us. As anticipated by Josef, as you can see here at page eight, the P&L of the group for Q1 compared to prior year. Definitely the revenue was up at 10%, basically aligned to our expectation. If we go in details of the revenue, definitely we had a very strong growth, both in Digital Trust and Cybersecurity, while Business Innovation continue on a single digit revenue growth. In term of cost, as you can see here, basically as a percentage of revenue is not changing too much, even though we have to consider that Q1 is the lowest quarter in term of revenue of EBITDA of the group. The EBITDA achieved EUR 50 million at 17.4%, growing 3% compared to previous year. We will deep dive later into result by business unit in order to analyze that. The stock option non-recurring costs are down significantly compared to previous year due to a lower M&A activities of deal completed during this period. Depreciation, amortization, and provision is growing compared to previous year, but keeping more or less the same incident incidents already. Financial income, as predicted, you know, during the presentation of the plan, you know, we started to invest our liquidity. As of today, we are investing our liquidity in time deposit, getting a positive income that is above 2% that is higher than the cost of our debt. In term of financial charges, as you may see in the document, in the quarter report, you know, financial charges we accounted here more costs for earn-out. This is again, even though it's a cost, it is a good sign. It means that the companies are performing better and as well as some leasing costs that are interest related to leasing costs are booked here. Net income of continued operation is growing from EUR 1.3 to EUR 2.1 million. During Q1, we completed the disposal of Credit Information Division. We completed the sale of ReValuta, posting a EUR 35.7 profit about this deal. The net profit is close to EUR 240 million. Definitely, if we move to the balance sheet, at page nine, definitely you will see here that we are keeping the net investment capital basically aligned to the end of the year. Our net financial position has dropped finally, as predicted, to 0 when, you know, basically we were helped by this, by the free cash flow of the business around the... this quarter, as well as the capital increase of Bregal that completed what agreed in during the agreement with them and the disposal of ReValuta. Shareholder equity went up to almost EUR 500 million. When we look at the results of Q1, definitely we are very happy of the performance. We will deep dive later, but revenue is going up. Digital Trust continue, for, you know, now is many quarters in a row where the revenue and the EBITDA are growing more than double digit. We had, basically, as predicted again, the rebound of Cybersecurity, where obviously here it is clear that the cost that we put in the P&L last year to enable the growth of the following year is now happening exactly as predicted. Very important here is to state that, you know, the business is developing as agreed. Business Innovation, I would say, is lower than previous year. Again, here we are talking about the business unit that is delivering the largest amount of EBITDA, and Q1 amounted for 10% of the total year. We have some kind of different scheduling. We have also to remember the last quarter, you know, the group was able to deliver 35% growth quarter on quarter. Net financial position going basically to zero is another important achievement that, you know, stands as a platform for future development as anticipated during our plan presentation. Net financial position, as you can see here, went down to EUR 3 million, and the free cash flow has been again, very positive, as we delivered basically 23 million of adjusted free cash flow in a quarter. Definitely, Q1 is one of the best quarter in term of free cash flow, as, you know, basically we collect all the revenue that we deliver in Q4. it was a very strong Q1, both in 2022 and 2023. For your reference, last year, we generated more than EUR 10 million out of the working capital. This year, we generated more than EUR 13 million out of the working capital, this is again, a very, very positive news. If we look at the bridge of our net financial position, the free cash flow from operation is close to EUR 23 million. Financial charges, again, very limited, most lately to, you know, lease interest related to leasing and earn-out. Then we have the disposal basically of ReValuta. No other major amounts here. We have the external investment in intangible asset through a partnership that we put together with CRIF. If we look at where we stand it, I'm going now to page 12, where we're standing, basically, one year ago. We had a total debt of EUR 230 million, now we are basically to zero. The company was able to, you know, through the disposals, you know, basically of Innolva and ReValuta. Basically at the end, we were able to cash more than EUR 170 million, and we had a free cash flow of EUR 50 million on LTM basis. That has been absolutely positive. Having said that, I would move to basically to business units. You know, as we can see here, basically Digital Trust continue to go up quite significant in term of revenue close to 12% and more than 12% in EBITDA. InfoCert, that is, you know, the most important part of this avenue is up of more than 15%. We had also good news from the Spain business that start, despite, you know, very little compared to the other business, despite was able to grow up more than 20%, as well as the business of Visura is very solid and stable and went up quite significantly. In term of EBITDA adjusted, you know, we were able to deliver a better result. In term of cybersecurity, the revenue started to go up quite significantly, and this was driven by the cybersecurity business compared to the digital business, and this is what actually we were expecting. As we anticipated here, basically we are late, six, nine months compared to our initial plans. Now I would say that Q4 2022 and Q1 2023 are aligned with our expectation. We are in the phase where we are delivering definitely a significant improvement of EBITDA. Obviously, most important part of the business is going to occur in Q3 and Q4, but, you know, we feel very confident about this. Business Innovation is kind of, you know, positive in term of revenue growth. In term of EBITDA, you know, we are slightly below. This part is a mix of revenue, as, you know, we are adding new businesses with a lower margin, and partially is, you know, the seasonality of the business compared to previous year. We are following this, but as you have seen very clearly during Q4 last year, the Q4 is the key moment of the business. This is what we are If we move to going a little bit deep diving on Digital Trust, we have to say that, you know, the performance at page 15, the persona was strong on all accounts, both in term of, you know, industry and products. Definitely, we are growing quite significantly in the public administration as well as we are performing such a consolidation in finance and utilities. We are growing very strong in the identity and onboarding service. At the international level, you know, we are continue to improve our sales into our European clients. We are not yet consolidating Ascertia, for which we are designing and we are expecting, you know, the closing not too far to happen. But already from the, you know, commercial standpoint, we are working very well and we are preparing, you know, the future consolidation of Ascertia. Again, this Q1 has been another very solid quarter for Digital Trust. Continue to grow double-digit both in revenue, EBITDA. Now this is, you know, we feel very, very comfortable on delivery of results of this activities. Cybersecurity, this is good news. I remember quite a lot of questions during the plan presentation. We, you know, Mr. Comastri with his team were able to put together a very, very clear and ambitious plan. Q1 has been delivered exactly what we expected. We are very happy about. Although the numbers, you know, still are small for the seasonality, we are very confident as, you know, the revenue came in a very organic way during the quarter. The pipeline is improving and also the cost control and delivery EBITDA has been perfectly matched with the plan. We registered a very positive performance, especially on the cybersecurity lines. I mean, both advisory implementation services and managed security services as well as product. This is a very, very good indicator. All the three companies of the business unit performed well, so this is a very positive situation. Part of the direct business, you know, we, during the months of March, we, Tinexta Cyber signed an important partnership with Google Cloud. This is even more, you know, an indicator that, you know, our business, our capabilities, our skill are recognized from such an important partner. This partnership will allow the business unit to consolidate its position as a reference of the cybersecurity arena in Italy. This will bring our solution to the Google Cloud marketplace. Let's say that, you know, again, the EBITDA delivered was more than EUR 2 million, basically doubling compared to previous year. I would say even more important, EBITDA in Q1 is already above 10%. This is, you know, a very good first step towards the delivery of the budget that we put together. Again, we can say here, as anticipated some quarters ago, we had, you know, a delay of six to nine months in delivering what expected. Now, you know, first three months, and I would say even April, is expected to be a month definitely aligned with our expectation. Business Innovation. You know, as you know, this is the business unit that is delivering the largest EBITDA during the full year. Q4 has been a very strong Q4. In Q1, we, as anticipated, we worked quite a lot in organizing ourselves. We ran the merge among five legal entities. We designed a new organization that will best fit our customer needs. We integrated, you know, the two main acquisition of 2022 that are Enhancers, Plannet, in order to develop the digital area of the business. Now, you know, we are basically approaching the market in an even more integrated manner, exploiting on the possible opportunity that are on the market. The revenue in the area of the Business Innovation was, let's say, positive in most part of the business. Warrant, you know, went up compared to previous year. The only area, but that was already anticipated, that is shrinking a bit, is the area of service to PME for internationalization. This is shrinking a bit, but this was something that was expected. In term of profitability, you know, this is a very scalable business, as you definitely understand. It means that during Q4, basically is a consulting business, but part of this consulting business is, you know, on as a success fee, the most important part of Warrant. You know, so Q1 and Q2 are, you know, let's say quite weaker quarter compared to the final part of the year. We do expect, you know, the again, Business Innovation to deliver as expecting during the. Honestly, very promising Q1. Very solid Q1, in InfoSec and cybersecurity. The business innovation delivering what we expect in as our calendarization. I would say stronger continue stronger cash conversion. I would say now we are at 0 net financial position. That has been a great achievement. It is a very important platform for future, for future development. Okay. Now we turn to the last part of the call. We can turn to page 19, where substantially following the very robust Q1 results, we are confirming our guidance. There's a summary page, and we want this to be very clear and crystal clear. On a 2023 versus prior year basis, revenues for 2023 are expected to grow organically anywhere between 11%-15%. EBITDA adjusted anywhere between 8%-12% versus prior year, and that is as of December 31st, 2022. The net financial position over adjusted EBITDA is going to be expected cash positive, with dividends in the realms of 30% of net profit. We remind the market that our plan, which was presented in March, includes an inflation estimate of around 6% for this year. On the bottom line, you see instead the 2025 outlook, which stays intact at low to mid double-digit on the revenue line. That is a 2022-2025 CAGR. EBITDA adjusted to be expected for the time period at double-digit, cash positive in terms of leverage ratio, and a dividend policy of around at least 35% of net profit by the end of the plan. On the 2022 and 2025 CAGR assumption timeframe, the assumed estimated inflation is around 3%. We wanted that to be clear to the market. On the other slide, on page 20, I won't go over them, but those are the divisional expectations that stand still as we speak. At this point, I will leave it to the operator to open the Q&A session in order for us to start answering any of the calls. 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 then one on their touchtone telephone. To remove yourself from the question queue, please press star then tw. Please pick up the receiver when asking questions. Anyone who has a question may press star and 1 at this time. Our first question is from Isacco Brambilla with Mediobanca. Please go ahead. Hi. Good afternoon, everybody. Thanks for taking my questions. I have two. The first one is on the strategic partnership with CRIF. Just if you can provide a bit more color on how the partnership works and potential contribution going forward? Second question is on CapEx. You had quite important investments in the first part of the year, of course, big part related to the CRIF digital software platform. Can you give us a sort of guidance on CapEx for this year? Thanks. Hello. Hello. Isacco. Oddone here. You know, if we talk about, you know, CapEx, I would say I will split this in two parts. In fact, as you may have seen, there is a part that is our recurring part that has been in the range of EUR 5 million, growing compared EUR 2.5 million of last year, perfectly aligned with what we expected. You know, we are expecting CapEx in the range of EUR 18 million-EUR 20 million per year. The EUR 13 million investment is, you know, a one-off CapEx. Basically has been an investment in a software, in a platform of CRIF, for which we announced there has been a, you know, a joint press release or where, you know, basically we enter into a partnership in order to work together to this. Basically the last part of the partnership that we engage. Basically we were, we acquire the software in order to provide services to CRIF clients and this is part of a commercial approach for which we are addressing our both customer on this. You may consider this more than a CapEx actually as a part of a little bit more as An acquisition of a part of a business. Definitely we already had revenues related to this and margin that help our results. The third question was? Sorry, Isacco, I miss you. Actually it was just a couple of questions. One on the CapEx and the other one... Okay. On the same call on CRIF partnership. I guess you already answered. Thanks, Oddone. Thank you. Thank you, Isacco. Our next question is from Renato Gargiulo with Intesa Sanpaolo. Please go ahead. Yes, good afternoon. First question on Digital Trust. You were mentioning growing the public administration market also thanks to NRRP. I was wondering here if you can assume an acceleration going forward, what's your visibility on that? In terms of profitability, you are seeing a positive sales mix in the first part. Would it be still a good profitability driver going forward, or as you were saying before, we should consider still operating leverage and scalability of the business as the main driver? The second question is on Defense Tech, if you have any update on that. You were anticipating that you were starting a common plan to develop industrial and commercial synergies. After the closing, I was wondering if you have any more indication. You were saying that in the business plan, you were not including any impact, if there could be any, coming from synergies over the next quarters. The third and last question, clearly on M&A, as you were saying, and now you are, you have almost 0 net debt. An update on your strategy, what are the main markets you are still considering? Could you make another potential acquisition in France or Spain or anything else? Thank you very much. Okay. Let's start from, you know, PA. Definitely, you know, Digital Trust is working honestly 360 degrees, trying to address both, you know... I'm talking about digital transformation management of course, is approaching large corporate banks and PA. With PA, I would say we are working very well. We are getting orders. We are getting new customers. We are not going to disclose. We are only to disclose them on commercial side. Definitely this is a continued activity of getting new order, new clients that is obviously helping us to increase our portion of recurring revenue and having a more and more stable and steady growth. PNRR is it was already part for this in of our expectations. So far we are very happy, very confident, and we think we will continue. Anticipating now if you can do 1% more or 1% less is too early, but it's not changing the picture. The company, the business unit is very solid. Is grow constantly and there are no big jump in term of revenues or EBITDA. The company is very solid, very strong. It is continual. Results are there. As well, the cash conversion is very positive. The second question, if I'm not wrong, was on sales mix. You're talking about the Digital Trust or the group as a whole? Yes. No, Digital Trust. Digital Trust. Oh, the sales mix is not changing too much. I would say that, looking at one single quarter, you know, also for us is not... You know, more or less, we have the solid, you know, split between off-the-shelf and digital transformation management. Digital transformation management is growing a little bit faster. You know, we are looking at this on a bit larger horizon. No, we do not expect a significantly change mix. Our strategy is always the same. We are addressing in a positive way. Maybe I will leave to Josef on Defense Tech or M&A. Obviously, for us, you know, new, is still an important achievement having achieved basically zero debt. The group is ready, is further ready, you know, even more ready, to run M&A. I would say that at this point in time, we are scaling up, you know, our targets of our investments. You have seen that with the Defense Tech, you know, if you combine the first part with the potential second part of the call, we are talking above EUR 100 million. Now, you know, we are and we did this important step already at the end of last year with the closing that just occurred. I would say that our strategy is always the same. Main focus on Digital Trust, on international development. You know, even Q1 is reinforcing our strategy. Second is potentially if there is an opportunity to support the international expansion of the Business Innovation. If we find out the right deal in Italy for Cybersecurity, we go ahead. If I have to think as a person of a location, definitely the opportunities we are pursuing, we may have internationally 40% are, you know, the most important targets as of now. During Q1 has been also completed the shared capital increase of Bregal that now accounted in total for EUR 100 million. Everything now is ready to continue our process to identify targets and then trying to complete the deal. Right. The other question, Renato, was on Defense Tech. As you, as you guys know, in April, we completed the closing of a minority stake, which is obviously 20%. EUR 25 million is the equivalent economic value of it. It must be said that, you know, we are talking about a listed company on the other side. Prior to any sort of closing and any sort of authorization in terms of, you know, from a legal perspective, we couldn't really do much now before that, even though we had already started our talks even before the deal. We are now a minority shareholder. We need to say that is a fact. At this point, we have open conversation, open tables, where we have a dedicated team on both sides of the companies that are obviously deep diving into the product offering, into the eligibility of the product offering from a Defense Tech standpoint, as well as from a Tinexta Cyber standpoint. Let us all recall what our CEO said during the March presentation to the market. Obviously, we are undergoing a full assessment of the technology, of the compatibility of the technology from Defence Tech, which obviously has a different type of audience versus a commercial audience that Tinexta Cyber has. I would say that we are fully in line with the execution part. Now, just to re-echo a little bit what Oddone just said, you know, everything that we said, I would say a month and a half ago during the plan is now happening and is now a fact. I think DefenseTech is exactly also in track, or on track, I would say, in terms of understanding how these synergies are actually gonna play out once the offering are gonna be, I would say, you know, united together, on the market. We really can't say much more than that. I'm sure the market can understand. We'll, we'll keep you posted, on any further developments. Yes. Perfect. Thank you. Yeah. Our next question is from Carlo Maritano with Intermonte. Please go ahead. Good afternoon, everyone. You already answered most of my questions. I still have one. I was wondering if you could help us understand, how much of the growth in Cybersecurity innovation is organic, and how much is coming from the small acquisition you completed, during last year? Thanks. I would say that, you know, is the growth, I would say is mostly organic. You know, we are not talking. The growth is coming all from the, let's say, cybersecurity part of business, this is very important. Now, you know, the company has been merged into the deal, and now it's very difficult to say because on one side, you know, some products of the company we acquired has been sold through the sales force of Corvallis. We consider basically as full organic and will be more and more during the year. Carlo? Can you hear me? Go ahead. Mr. Maritano, your line is still open. Okay. No. Okay. Thank you. Once again, if you have a question, please press star then one on your telephone. No other further questions? There's one question, sir, from T imothy Pedroni with Schroders. Please go ahead. Hi. Hello. Just actually a sort of broad question about AI, generative AI. Is there any thinking within the company about how, again, generative AI might impact any of your business divisions? I know this is a very sort of, yeah, broad discussion, but is there anything that you think that you might be, you know, aided or competed away from, you know, a large uptake of AI among, you know, from you or your customers? Just trying to understand how to think about this. This is a very good point. We have to say that, during Q1, You know, several companies of the group started, as each company has a very different focus and kind of customers and applications. Most of the company has already started some projects on AI. It has a tool to improve productivity or tool to fasten some activities. Now we are trying to, we let this kind of innovation to develop, and also but as a group also, we are trying to monitoring them and to channel in the right direction, not to duplicate efforts. In this period, I think it would be even more beneficial to basically let people thinking out of the box and trying to catch all the opportunity that AI can bring. Nothing still, you know, solid there. We have an innovation committee that has been held every month that keep the steps on this. As of today, we have no, let's say, products or solution to bring to the market based on AI, but, you know, all the companies are work on this. Got it. Thank you. You're welcome. Any other questions? Mr. Mastragostino, there are no further questions registered at this time. Okay. Well, thank you. We would like to thank you for connecting to Tinexta's conference call. If you need any additional information, please don't hesitate to contact us. Have a good afternoon to all of you. Thank you. Thank you, everybody. Talk to you soon. Bye.