Half Year 2026 Cabka NV Earnings Call

August 13, 2026

Operator: Good morning, everyone, and welcome to the Cabka H1 2026 results conference call. With us today are CEO Alexander Masharov and CFO Mark Letterie. Alex and Mark will both make a short presentation, after which we will go to Q&A. For those of you following the call via the webcast, you will be able to submit your question via the Q&A module. You can find a copy of this presentation online at investors.cabka.com. At this time, all participants joining via conference call are in a listen-only mode. To ask a question during the Q&A session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference call is being recorded.

Operator: Good morning, everyone, and welcome to the Cabka H1 2026 Results Conference Call. With us today are CEO Alexander Masharov and CFO Mark Letterie. Alex and Mark will both make a short presentation, after which we will go to Q&A. For those of you following the call via the webcast, you will be able to submit your question via the Q&A module. You can find a copy of this presentation online at investors.cabka.com. At this time, all participants joining via conference call are in a listen-only mode. To ask a question during the Q&A session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference call is being recorded.

Speaker #1: Good morning, everyone, and welcome to the Cabka H1 2026 results conference call. With us today are CEO Alexander Asherov and CFO Mark Letteray. Alex and Mark will both make a short presentation, after which we will go to Q&A.

Speaker #1: For those of you following the call via the webcast, you will be able to submit your questions via the Q&A module. You can find a copy of this presentation online at investorcabka.com.

Speaker #1: Apologies—investors.cabca.com. At this time, all participants joining via conference call are in a listen-only mode. To ask a question during the Q&A session, you will need to press star 11 on your telephone; you will then hear an automated message advising your hand is raised.

Speaker #1: To withdraw your question, please press star 11 again. Please be advised that today’s conference call is being recorded. As is standard, this presentation is subject to the usual disclaimers regarding accuracy, completeness, and forward-looking statements.

Operator: As is standard, this presentation is subject to the usual disclaimers regarding accuracy, completeness, and forward-looking statements. You can also find more details of these disclaimers on the investors section of our website. I would now like to hand over to Alex, who will take you through our operational highlights for the H1 of 2026.

Speaker #1: You can also find more details of these disclaimers in the Investors section of our website. I would now like to hand over to Alex, who will take you through our operational highlights for the first half of the year 2026.

Alexander Masharov: Good morning to everyone joining us, and welcome to our H1 results presentation. In the first 6 months of this year, we delivered revenue growth, materially stronger profitability, and a return to a positive net result. Most importantly, operational EBITDA grew significantly faster than revenue. This demonstrates the operating leverage within Cabka business model and the impact of our improved product mix, disciplined execution, and the structural cost measures implemented through our Shift program. These results were only possible because of the commitment and hard work of our people across the company. As such, I would like to take this opportunity to thank all Cabka employees for their resilience, dedication, and continued focus through the H1 of the year. We achieved this performance against a volatile market backdrop.

Alexander Masharov: Good morning to everyone joining us, and welcome to our H1 results presentation. In the first six months of this year, we delivered revenue growth, materially stronger profitability, and a return to a positive net result. Most importantly, operational EBITDA grew significantly faster than revenue. This demonstrates the operating leverage within Cabka business model and the impact of our improved product mix, disciplined execution, and the structural cost measures implemented through our Shift program. These results were only possible because of the commitment and hard work of our people across the company. As such, I would like to take this opportunity to thank all Cabka employees for their resilience, dedication, and continued focus through the H1 of the year. We achieved this performance against a volatile market backdrop.

Speaker #2: Good morning to everyone joining us, and welcome to our H1 results presentation. In the first six months of this year, we delivered revenue growth, materially stronger profitability, and a return to a positive net result.

Speaker #2: Most importantly, operational EBITDA grew significantly faster than revenue. This demonstrates the operating leverage within Cabka's business model and the impact of our improved product mix, disciplined execution, and the structural cost measures implemented through our Shift program.

Speaker #2: These results were only possible because of the commitment and hard work of our people across the company. As such, I would like to take this opportunity to thank all current employees for their resilience, dedication, and continued focus through the first half of the year.

Speaker #2: We achieved this performance against a volatile market backdrop. Geopolitical disruptions in the Gulf created significant movements in energy and raw material markets, and contributed to longer customer decision cycles toward the end of the second quarter.

Alexander Masharov: Geopolitical disruptions in the Gulf created significant movements in energy and raw material markets and contributed to longer customer decision cycles towards the end of Q2. More recently, raw material prices have eased from their peaks, and we are seeing early signs of customer and tender activity picking up. I will return to the market environment and our outlook later in the presentation. Our priorities remain clear: disciplined execution, sharper customer and product focus, and innovation that creates measurable value for our customers. These priorities are the foundation for sustainable growth, stronger profitability, and improved cash generation. Getting down to the numbers themselves. Revenue increased by 6% to EUR 95.5 million, with Europe being the principal driver of growth and positive development across all major product lines. Reported revenue in the US declined by 7%.

Speaker #2: More recently, raw material prices have eased from their peaks, and we are seeing early signs of customer and tender activity picking up. I will return to the market environment and our outlook later in the presentation.

Speaker #2: Our priorities remain clear: disciplined execution, sharper customer and product focus, and innovation that creates measurable value for our customers. These priorities are the foundation for sustainable growth, stronger profitability, and improved cash generation.

Speaker #2: Turning now to the numbers themselves. Revenue increased by 6% to €95.5 million, with Europe being the principal driver of growth and positive development across all major product lines. Reported revenue in the US declined by 7%.

Speaker #2: However, on a currency basis, the underlying performance was broadly stable. Supported by continued progress in contract manufacturing, the most important number on this slide is operational EBITDA.

Alexander Masharov: However, on a constant currency basis, the underlying performance was broadly stable, supported by continuing progress in contract manufacturing. The most important number on this slide is operational EBITDA. It increased by 50% to EUR 13.6 million, while the operational EBITDA margin improved by 410 basis points from 10.1% to 14.2%. This improvement was not driven by a single factor. It reflects the combination of higher revenue, a stronger product mix, disciplined cost management, and the benefits of the Shift measures implemented over the past 18 months. More importantly, this improvement also reached the bottom line. As such, Cabka recorded a net profit of EUR 1.2 million, compared with a net loss of EUR 4.7 million in the H1 of 2025. Let me also spend a moment to emphasize that 83% of our raw material intake now comes from recycled material.

Speaker #2: It increased by 50% to €13.6 million, while the operational EBITDA margin improved by 410 basis points from 10.1% to 14.2%. This improvement was not driven by a single factor.

Speaker #2: It reflects the combination of higher revenue, a stronger product mix, disciplined cost management, and the benefits of the shift measures implemented over the past 18 months.

Speaker #2: More importantly, this improvement also reached the bottom line, as such Cabka recorded a net profit of $1.2 million euros compared with a net loss of a $4.7 million euro in the first half of 2025.

Speaker #2: Let me also spend a moment to emphasize that 83% of our raw material intake now comes from recycled material. Not only is this in excess of our 80% target, but it also gives us a real advantage relative to our competitors, given the recent volatility that we have seen in virgin plastic prices as a result of the war in the Gulf.

Alexander Masharov: Not only is this in excess of our 80% target, but it also gives us a real advantage relative to our competitors given the recent volatility that we have seen in the virgin plastic prices as a result of the war in the Gulf. in Europe, we showed strong progress with 18% growth in revenues. The growth was broad-based across Portfolio, Customized Solutions, and contract manufacturing. Customized Solutions was the stronger contributor, up 41%, supported by a broader customer base and the addition of new product programs. Over the past 18 months, we have dedicated significant attention to the Shift program. The main structural measures have now been implemented, and their impact is visible in the H1 results. This does not mean that our work on productivity and costs are finished. We will maintain strict operating discipline, with progressively shifting more management attention toward the discipline and profitable growth.

Speaker #2: In Europe, we showed strong progress with 18% growth in revenues. The growth was broad-based across portfolio, customized solutions, and contract manufacturing. Customized solutions was the stronger contributor.

Speaker #2: Up 41%, supported by a broader customer base, and the addition of new product programs. Over the past 18 months, we have dedicated significant attention to the shift program.

Speaker #2: The main structural measures have now been implemented, and their impact is visible in the H1 results. This does not mean that our work on productivity and costs is finished.

Speaker #2: We will maintain strict operating discipline, with progressively shifting more management attention toward disciplined and profitable growth. In the U.S., as already mentioned, the underlying constant currency performance was broadly stable.

Alexander Masharov: In the US, as already mentioned, the underlying constant currency performance was broadly stable, with continuing progress in contract manufacturing. We have also strengthened our commercial leadership and market coverage. Our new US managing director started on 1 July, and we have reinforced the sales organization. Our objective is clear. Stronger commercial execution, better customer proximity, and improved utilization of our US capabilities. We will provide a further update on the development of the US business at our capital market update on 24 November. On sustainability, PPWR legislation on sustainable packaging in the EU was applicable as of yesterday. Cabka's Reusable Transport Packaging already meets the criteria with 83%, as mentioned, of our intake coming from recycled material. This positions us well ahead of our peers and is reflected in our EcoVadis gold score, placing us in the top 5% of companies assessed worldwide.

Speaker #2: With continued progress in contract manufacturing, we have also strengthened our commercial leadership and market coverage. Our new U.S. managing director started on July 1, and we have reinforced the sales organization.

Speaker #2: Our objective is clear: stronger commercial execution, better customer proximity, and improved utilization of our US capabilities. We will provide a further update on the development of the US business at our Capital Market Update on November 24.

Speaker #2: On sustainability, PPWR legislation on sustainable packaging in the EU was applicable as of yesterday. Cabka's reusable transport packaging already meets the criteria with 83%, as mentioned, of our intake coming from recycled material.

Speaker #2: This positions us well ahead of our peers. And is reflected in our ECOVADIS Gold score placing us in the top 5% of companies assessed worldwide.

Speaker #2: I would now like to spend a moment on the development of raw material and energy markets during the first half. As is known, geopolitical disruption in the Gulf created significant volatility in oil, energy, and raw polymer markets.

Alexander Masharov: I would now like to spend a moment on the development of raw material and energy markets during the H1. As known, geopolitical disruption in the Gulf created significant volatility in oil, energy, and raw polymer markets. Towards the end of the Q2, this uncertainty contributed to longer customer decision cycles and affected the timing of new orders and tenders. This is reflected in our outlook and will influence the phasing of business into this Q4. More recently, virgin material prices have eased from their earlier peaks, and we have seen encouraging signs of tender activity returning. We nevertheless remain prudent regarding the timing between renewed customer activity, confirmed orders, and recognized revenue. With recycled materials representing 83% of our raw material intake, Cabka has lower direct exposure to virgin plastic prices movements than our competitors who rely predominantly on virgin materials.

Speaker #2: Towards the end of the second quarter, this uncertainty contributed to longer customer decision cycles and affected the timing of new orders and tenders. This is reflected in our outlook and will influence the phasing of business into the third quarter.

Speaker #2: More recently, virgin material prices have eased from their earlier peaks, and we have seen encouraging signs of tender activity returning. We nevertheless remain prudent regarding the timing between renewed customer activity, confirmed orders, and recognized revenue.

Speaker #2: With recycled materials representing 83% of our raw material intake, Cabka has lowered direct exposure to virgin plastic price movements compared to our competitors, who rely predominantly on virgin materials. However, recycled material costs are not completely insulated from movements in energy, transport, and broader polymer markets.

Alexander Masharov: However, recycled material costs are not completely insulated from movement in energy, transport, and broader polymer markets. We therefore continue to manage procurement and customer pricing with discipline in accordance with contract mechanism and current market conditions. Our priority is to protect long-term customer relationships while maintaining appropriate margins. Energy costs also remain elevated and volatile. We are taking active measures through procurement, consumption management, and targeted operational initiatives to mitigate their impact. With that, I will hand over to Mark, who will take you through financial performance in more detail. I will return afterwards to discuss our outlook and priorities for the remainder of the year.

Speaker #2: We therefore continue to manage procurement and customer pricing with discipline in accordance with contract mechanisms and current market conditions. Our priority is to protect long-term customer relationships while maintaining appropriate margins.

Speaker #2: Energy costs also remain elevated and volatile. We are taking active measures through procurement, consumption management, and targeted operational initiatives to mitigate their impact. With that, I'll hand over to Mark, who will take you through the financial performance in more detail.

Speaker #2: I will return afterward to discuss our outlook and priorities for the remainder of the year.

Speaker #1: Thank you, Alex, and good morning, everyone. I'm pleased with the progress that we have made in the year since I joined Cabka. The group's performance has seen 6% growth in sales, converted into 50% more EBITDA, and a significant jump in profit to a positive net result.

Mark Letterie: Thank you, Alex, and good morning, everyone. I am pleased with the progress that we have made in the year since I joined Cabka. The group's performance has seen 6% growth in sales converted into 50% more EBITDA and a significant jump in profit to a positive net result. We have maintained a stable cost base and stable net debt since the start of this year. Alex has already given you some headlines on our sales growth, and before I go into more detail in the coming slides, I would like to focus on the EBITDA performance. Our operational EBITDA has improved to EUR 13.6 million, representing a 14.2% margin. This is a considerable year-on-year improvement and puts us firmly on track to reach our 15% target. Our higher EBITDA is also a function of improved product mix.

Speaker #1: While we have maintained a stable cost base and stable net debt since the start of this year, Alex has already given you some headlines on our sales growth.

Speaker #1: And before I go into more detail in the coming slides, I would like to focus on the EBITDA performance. Our operational EBITDA has improved to €13.6 million, representing a 14.2% margin.

Speaker #1: This is a considerable year-on-year improvement and puts us firmly on track to reach our 15% target. Our higher EBITDA is also a function of improved product mix.

Speaker #1: For example, our CabQ branch, which we launched last year, has contributed to the margin improvement. This is a product where we see potential for future growth moving forward.

Mark Letterie: For example, our CabCube range, which we launched last year, has contributed to the margin improvement, and this is a product where we see potential for future growth moving forward. You will note that our working capital has been under some pressure, which is in part due to higher material costs. However, we will continue to focus on further reducing our debt from current levels in the second half of the year. Net income from operations came in at EUR 1.2 million, which is a EUR 5.3 million improvement compared to the first half of last year. Turning now to our product segments. I would like to flag that our growth has been largely volume driven, with only a limited impact from pricing. The Portfolio segment as a whole has seen modest growth in comparison to Customized Solutions and contract manufacturing and is not yet where we would like to see it.

Speaker #1: You will note that our working capital has been under some pressure, which is in part due to higher material costs. However, we will continue to focus on further reducing our debt from current levels in the second half of the year.

Speaker #1: Net income from operations came in at €1.2 million, which is a €5.3 million improvement compared to the first half of last year. Turning now to our product segments.

Speaker #1: I would like to flag that our growth has been largely volume-driven, with only a limited impact from pricing. The portfolio segment as a whole has seen modest growth in comparison to customized solutions and contract manufacturing.

Speaker #1: And it is not yet where we would like to see it. As such, this remains an area of focus for new products. In saying that, within both our portfolio and customized solution segments, we have a strong footprint in mobility-based products, bringing in €2.8 million in revenues in each category.

Mark Letterie: As such, this remains an area of focus for new products. In saying that, within both our Portfolio and Customized Solutions segments, we have a strong footprint in mobility-based products, bringing in EUR 2.8 million in revenues in each category. In contract manufacturing, Alex already mentioned we have seen a strong performance in the US, and we also see a big improvement in Europe. This growth in both Europe and US contract manufacturing sales is the result of a conscious decision to use contract manufacturing to improve our capacity utilization. Looking at our performance in ECO, revenues have been broadly flat. However, the segment is more profitable and better managed. Here we can look in more detail at the performance in the US.

Speaker #1: In contract manufacturing, as Alex already mentioned, we have seen strong performance in the US, and we are also seeing significant improvement in Europe. This growth in both European and US contract manufacturing sales is the result of a conscious decision to use contract manufacturing to improve our capacity utilization.

Speaker #1: Looking at our performance in ECO, revenues have been broadly flat. However, the segment is more profitable and better managed. Here, we can look in more detail at the performance in the US.

Speaker #1: Although the headline figure for the US shows a negative performance, I would like to flag that, in local currency terms, overall performance was broadly in line.

Mark Letterie: Although the headline figure for the US shows a negative performance, I would like to flag that in local currency terms, overall performance was broadly in line, actually growing slightly compared to H1 2025. As already mentioned, our focus in H1 has been on improving our capacity utilization and profitability by growing our contract manufacturing business. This has been a successful strategy, and we will continue to target this as a lever for future growth, coupled with an increased focus on Customized Solutions and Portfolio as our new head of US sales looks to boost commercial momentum in the region. Having covered the regional and segment-level sales performance, let me now take you through how this translated into the overall income statement. As discussed, sales increased by 6% to EUR 95.5 million. More importantly, gross profit grew faster than revenue, increasing by 11% to EUR 49.5 million.

Speaker #1: Actually growing slightly compared to the first half of 2025. As already mentioned, our focus in the first half has been on improving our capacity utilization and profitability via growing our contract manufacturing business.

Speaker #1: This has been a successful strategy, and we will continue to target this as a lever for future growth, coupled with an increased focus on customized solutions and our portfolio, as our new Head of US Sales looks to boost commercial momentum in the region.

Speaker #1: Having covered the regional and segment-level sales performance, let me now take you through how this translated into the overall income statement. As discussed, sales increased by 6% to €95.5 million.

Speaker #1: More importantly, gross profit grew faster than revenue, increasing by 11% to €49.5 million. This lifted our gross profit margin by 220 basis points to 51.9%.

Mark Letterie: This lifted our gross profit margin by 220 basis points to 51.9%. Operating expenses remained broadly stable at EUR 36 million despite the growth in sales. This combination of a higher gross margin and disciplined cost management drove the improvement in operational EBITDA to EUR 13.6 million. After depreciation and amortization of EUR 9.3 million, operating income improved to a positive EUR 4.2 million compared with a net loss of EUR 0.6 million in H1 of last year. The net financial result also improved from a cost of EUR 2.9 million to EUR 2.3 million. Bottom line, this resulted in a positive net result of EUR 1.2 million, representing a year-on-year improvement of EUR 5.3 million. Turning to net debt. The strong EBITDA performance generated EUR 6.8 million of operating cash flow after correcting for the impact of working capital, taxes, and non-cash adjustments.

Speaker #1: Operating expenses remained broadly stable at €36 million, despite the growth in sales. This combination of a higher gross margin and disciplined cost management drove the improvement in operational EBITDA to €13.6 million.

Speaker #1: After depreciation and amortization of €9.3 million, operating income improved to a positive €4.2 million, compared with a net loss of €0.6 million in the first half of last year.

Speaker #1: The net financial result also improved, from a cost of €2.9 million to €2.3 million. Bottom line, this resulted in a positive net result of €1.2 million, representing a year-on-year improvement of €5.3 million.

Speaker #1: Turning to net debt, the strong EBITDA performance generated €6.8 million of operating cash flow after correcting for the impact of working capital, taxes, and non-cash adjustments.

Speaker #1: This cash generation was offset by our net investments, as well as interest and financing outflows. As a result, net debt remained broadly stable at €62.8 million.

Mark Letterie: This cash generation was offset by our net investments as well as interest and financing outflows. As a result, net debt remained broadly stable at EUR 62.8 million, compared with EUR 62.6 million at the end of 2025. As mentioned earlier, reducing, or rather managing debt remains a priority to help improve our leverage position, which is net debt over EBITDA. Unfortunately, our net working capital increased somewhat in H1. Much of the increase was related to the sharp increases in raw materials prices, which we discussed before, and as a result of this, inventory and prepayment of suppliers rose. We have also seen some increase in trade receivables, partly as a consequence of higher sales. Going forward into H2 of the year and beyond, we expect to see an improvement in the trade payables number. Turning now to our CapEx.

Speaker #1: Compared with €62.6 million at the end of 2025. As mentioned earlier, reducing—or rather managing—debt remains a priority to help improve our leverage position, which is net debt over EBITDA.

Speaker #1: Unfortunately, our net working capital increased somewhat in the first half. Much of the increase was related to the sharp increases in raw material prices, which we discussed before.

Speaker #1: And as a result of this, inventory and prepayment of suppliers rose. We have also seen some increase in trade receivables, partly as a consequence of higher sales.

Speaker #1: Going forward into the second half of the year and beyond, we expect to see an improvement in the trade payables number. Turning now to our CapEx.

Speaker #1: We have maintained our disciplined approach to CapEx spending that we initiated under the SHIFT program. We have also changed our focus from upgrades and capitalizable projects to more routine, preventive repair and maintenance spending.

Mark Letterie: We have maintained our disciplined approach to CapEx spend that we initiated under the Shift program. We have also changed our focus from upgrades and capitalizable projects to more routine preventive repair and maintenance spend, which obviously is directly expensed rather than being part of actual CapEx spend. What this means is that two-thirds of our CapEx is now dedicated to investments in our growth. In addition, we realized EUR 3 million in proceeds from asset disposals during H1. This related to sale and leaseback transactions, which allows us to allocate capital more efficiently. I am happy to answer any questions that you may have, but first let me hand back to Alex, who will talk about our outlook and guidance for H2 of the year.

Speaker #1: Which, obviously, is directly expensed rather than being part of actual CapEx spend. What this means is that two-thirds of our CapEx is now dedicated to investments in our growth.

Speaker #1: In addition, we realized €3 million in proceeds from asset disposals during the first half. This related to sale and leaseback transactions, which allow us to allocate capital more efficiently.

Speaker #1: I'm happy to answer any questions that you may have. But first, let me hand back to Alex, who will talk about our outlook and guidance for the second half of the year.

Speaker #2: Thank you, Mark. As we look to the second half of 2026, I can tell you with confidence that Cabka's performance is on track with our stated goals.

Alexander Masharov: Thank you, Mark. As we look to the H2 2026, I can tell you with confidence that Cabka's performance is on track with our stated goals. Our H1 has delivered on top line growth, increased profitability, and cash flow generation, which reinforces our confidence in our full year ambitions. For the H2, we continue to expect an improvement in revenues and a higher EBITDA margin than in 2025. We intend to hold a virtual capital markets update on 24 November, at which we will share more detail on our strategic roadmap, progress towards targets, and commercial insights. Thank you for your attention, and I would like to hand over to our moderator who will open up the lines for questions.

Speaker #2: Our first half has delivered on top-line growth, increased profitability, and cash flow generation, which reinforces our confidence in our full-year ambitions. For the second half, we continue to expect an improvement in revenues and a higher EBITDA margin than in 2025.

Speaker #2: We intend to hold a virtual capital markets update on the 24th of November, where we will share more detail on our strategic roadmap, progress towards targets, and commercial insights.

Speaker #2: Thank you for your attention. I would now like to hand over to our moderator, who will open up the lines for questions.

Speaker #3: Thank you. We will now begin the question-and-answer session. If you wish to ask a question, you will need to press *11 on your telephone and wait for your name to be announced.

Operator: Thank you. We will now begin the question and answer session. If you wish to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. If you wish to ask a question via the webcast, please type it into the box and click submit. We will take our first question. The question comes from the line of Ellis Acklin from First Berlin. Please go ahead. Your line is open.

Speaker #3: To withdraw your question, please press star one one again. If you wish to ask a question via the webcast, please type it into the box and click Submit.

Speaker #3: We will take our first question. The question comes from the line of Ellis Acklin from First Berlin. Please go ahead, your line is open.

Speaker #4: Yes, good morning, gentlemen. Thanks for the presentation and the opportunity to speak this morning. I'll kick things off with two topics for right now.

Ellis Acklin: Yes. Good morning, gentlemen. Thanks for the presentation and the opportunity to speak this morning. I will kick things off with two topics for right now. Firstly, I will ask one at a time. Just your comments on Q3 and demand. I understand you are now expecting a softer Q3, but at the same time, you are talking about a slight pickup since the end of the H1. Does that suggest that maybe this is more of a timing issue, or are you seeing any sort of underlying demand destruction there?

Speaker #4: Firstly, awesome, one at a time. Just your comments on Q3 and demand. I understand you're now expecting a softer Q3, but at the same time, you're talking about a slight pickup since the end of the first half of the year.

Speaker #4: Does that suggest that maybe this is more of a timing issue, or are you seeing any sort of underlying demand destruction there?

Speaker #1: Yeah.

Speaker #5: Thank you for your question. Let me tackle that one. You know, when we say Q3 is softer—softer than the first two quarters—H1 was close to €48 million of revenue per quarter.

Alexander Masharov: Thank you for your question. Let me tackle that one. When we say Q3 softer than the first two quarters. H1 was close to EUR 48 million of revenue per quarter. We do not expect Q3 too much debt. We maintain our guidance for the full year because we operate in a seasonal business, and in every year, Q3 is a bit weaker than other quarters. That is just the way business is. So yes, to your question regarding softer Q3, it is a bit softer comparison to what we had in the H1, but the guideline for the full year is still the same.

Speaker #5: We don't expect too much debt in Q3. We maintain our guidance for the full year. Because we operate in a seasonal business, every year Q3 is a bit weaker than the other quarters; that's just the way the business is.

Speaker #5: So yes, to your question regarding a softer Q3, it's a bit softer compared to what we had in the first half. But the guidance for the full year is still the same.

Speaker #4: Okay, very good. And then regarding the cash conversion and the working capital, I understand you had some pricing headwinds, particularly related to the inventory.

Ellis Acklin: Okay. Very good. Regarding the cash conversion, the working capital, I understand you had some pricing headwinds, particularly related to the inventory. Would it be fair to say that the inventory is strictly related to that, or is there some buildup there as well? Can we maybe expect, is there any room for reversal of that effect in the H2 of the year? That ties in to whether or not we might be able to expect any meaningful deleveraging by the end of the year.

Speaker #4: Would it be fair to say that the inventory is strictly related to that, or is there some buildup there as well? And can we maybe expect—is there any room for a reversal of that effect in the second half of the year?

Speaker #4: And then that ties into whether or not we might be able to expect any meaningful deleveraging by the end of the year.

Alexander Masharov: I will let Mark add to whatever comments I have. Look, for us, inventory is a strategic decision to make sure we know how to supply our customers. I think last year we fell short a little bit in terms of the supply over the demand we had because we had insufficient inventory. We control inventory very strictly. It was a constant decision to have slightly more inventory this year to actually get more revenues and to have our top line higher because then we can serve more customers. Can we always change this? Yes, we can, but we make those decisions on a weekly, monthly basis, and it very much depends on the demand. That is how we move.

Speaker #5: I'll let Mark add to any comments I have. Look, for us, inventory is a strategic decision to make sure we know how to supply our customers.

Speaker #5: I think last year we fell short a little bit in the supply over the demand we had because we had insufficient inventory. We control inventory very strictly.

Speaker #5: It was a conscious decision to have slightly more inventory this year to actually get more revenues and to have our top line higher, because then we can serve more customers.

Speaker #5: Can we always change this? Yes, we can. But we make those decisions on a weekly or monthly basis, and it very much depends on the demand.

Speaker #5: That's how we move.

Speaker #4: Okay, so if I understand you correctly, there is some buildup in there as well. It's not strictly pricing-related.

Ellis Acklin: Okay. So if I understand you correctly, there is some buildup in there as well. It is not strictly pricing related.

Alexander Masharov: Of course, there is a price relation as well. Sorry, I have not mentioned this yet, but yes, of course, raw material prices have increased, specifically virgin one, which is not affecting us so much. But of course, part of it is the raw material prices, even in recycling materials, they went up. So yes, there is a percentage there. To be honest, I do not want to disclose that percentage to the call here.

Speaker #5: Of course, there is a price relation as well. That's why I haven't mentioned it yet, but yes, of course. Raw material prices have increased, specifically in the Region One, which is not affecting us so much, but of course part of it is the raw material prices—even in the recycled materials, they went up.

Speaker #5: So yes, there is a percentage there. To be honest, I don't want to disclose that percentage on the call here.

Speaker #4: No, that's fair enough. That's very helpful in and of itself. Thank you for that one.

Ellis Acklin: No, that's fair enough. That's very helpful in and of itself. Thank you on that one.

Alexander Masharov: And-

Mark Letterie: And- Let me also add to what Alex explained. You asked about the deleveraging. That process is ongoing, right? That's why I specifically mentioned that we manage our debt position. Of course, the leverage is a combination of the EBITDA and the net debt position. While we were not able to reduce the debt position by much, our leverage position improved quite a bit because we improved our EBITDA. We'll continue to focus on deleveraging. Managing our networking capital is definitely an important lever there.

Speaker #5: And let me also add to what Alex explained. So, regarding the question you asked about deleveraging, that process is ongoing, and that's why I specifically mentioned that we manage our debt position.

Mark Letterie: Let me also add to what Alex explained. You asked about the deleveraging. That process is ongoing, right? That's why I specifically mentioned that we manage our debt position. Of course, the leverage is a combination of the EBITDA and the net debt position. While we were not able to reduce the debt position by much, our leverage position improved quite a bit because we improved our EBITDA. We'll continue to focus on deleveraging. Managing our networking capital is definitely an important lever there.

Speaker #5: But of course, the leverage is a combination of the EBITDA and the net debt position. And while we were not able to reduce the debt position by much, our leverage position improved quite a bit.

Speaker #5: Because we improved our EBITDA, we'll continue to focus on deleveraging. And managing our net working capital is definitely an important lever there.

Speaker #4: Okay, great. That's helpful. If I can sneak in just one more real quick, and then I'll hand it over to the floor again. Regarding the US RTP development, you mentioned there were some currency headwinds there that sort of distorted the overall performance.

Ellis Acklin: Okay, great. That's helpful. If I can sneak in just one more real quick and I'll hand it over to the floor again. Regarding the US RTP development, you mentioned there were some currency headwinds there that sort of distorted the overall performance. Then there was also something about some one-off effects maybe in the sales. Is there any way you could quantify those more specifically, to give us a cleaner read on the actual results adjusted?

Speaker #4: And then there was also something about some one-off effects, maybe in the sales. Is there any way you could quantify those more specifically to give us a cleaner read on the actual results?

Speaker #4: Adjusted?

Alexander Masharov: Can you repeat the second point? The first one, yes, you are right. In dollars, our US business was flat. The reported decline in translation, the euro strengthened around 6% between the two periods. This is an underlying adjusting for a revenue item in the prior year base. What was-

Speaker #5: Can you repeat the second point? Because the first one, yes, you're right. In dollars, our US business was flat. The reported decline is due to translation; the euro strengthened around 6% between the two periods.

Speaker #5: So, this is an underlying adjusting for revenue item in the prior year base. So,

Ellis Acklin: Yeah. Okay. Alex, I was curious if you would be willing to quantify what those effects were so we can get a cleaner read on the actual results when they are adjusted for those.

Speaker #4: Yeah, okay. So, Alex, I was curious if you would be willing to quantify what those effects were, so we can get a cleaner read on the actual results when they're adjusted for those.

Speaker #5: Yeah, let me jump in here. That was around $1 million US dollars. Where we had a positive headwind in 2025, that was not repeated in 2026.

Mark Letterie: Yeah. Let me jump in here. That was around $1 million where we had

Mark Letterie: Yeah. Let me jump in here. That was around $1 million where we had a positive headwind in 2025 that was not repeated in 2026.

Ellis Acklin: Okay

Mark Letterie: a positive headwind in 2025 that was not repeated in 2026.

Speaker #4: Okay. And that's just from the effects, then? Okay. All right. Well, good. Thank you very much. I'll—

Ellis Acklin: Okay. And that is just from the FX then. Okay.

Mark Letterie: All right.

Ellis Acklin: Well, good. Thank you very much.

Mark Letterie: That was an-

Speaker #5: That was an.

Ellis Acklin: I will hop back in the queue and let someone else go.

Speaker #4: I'll hop back in the queue and let someone else go.

Speaker #5: Yeah, no, just to clarify, that was an accounting correction in 2025. Next to that, we also had headwinds from ethics.

Mark Letterie: Yeah. Just to clarify, that was an accounting correction in 2025. Next to that, we also had headwinds from FX.

Speaker #4: Gotcha.

Ellis Acklin: Got you.

Speaker #2: Thank you. Once again, if you wish to ask a question, please press star one-one on your telephone. We will take our next question.

Operator: Thank you. Once again, if you wish to ask a question, please press star one one on your telephone. We will take our next question, and the question comes from Luc Van Beek from Degroof Petercam. Please go ahead. Your line is open.

Operator: Thank you. Once again, if you wish to ask a question, please press star one one on your telephone. We will take our next question, and the question comes from Luuk van Beek from Degroof Petercam. Please go ahead. Your line is open.

Speaker #2: And the question comes from Luc van Beek from Degroof Petercam. Please go ahead, your line is open.

Speaker #6: Yes, good morning. A couple of questions from my side. First of all, can you expand a bit on the mix improvements? You mentioned the CapCube that is driving more high-margin revenues.

Luc Van Beek: Yes, good morning. A couple of questions from my side. First of all, can you expand a bit on the mix improvements? You mentioned the CabCube that is driving more high-margin revenues. Do you have other products that also grow well with high margins? Also, can you indicate if there is still a lot of low-margin products that you are phasing out? The second question for now is on the cost savings, which are going very well. You indicated that you expect further cost savings to continue. Do you expect those to be sufficient to offset the cost inflation, or should we expect cost to move up with a lower percentage than inflation going forward?

Luuk van Beek: Yes, good morning. A couple of questions from my side. First of all, can you expand a bit on the mix improvements? You mentioned the CabCube that is driving more high-margin revenues. Do you have other products that also grow well with high margins? Also, can you indicate if there is still a lot of low-margin products that you are phasing out? The second question for now is on the cost savings, which are going very well. You indicated that you expect further cost savings to continue. Do you expect those to be sufficient to offset the cost inflation, or should we expect cost to move up with a lower percentage than inflation going forward?

Speaker #6: Do you have other products that also grow well with high margins? And also, can you indicate if there are still a lot of low-margin products that you are phasing out?

Speaker #6: And the second question for now is on the cost savings, which are going very well. You indicated that you expect further cost savings to continue.

Speaker #6: Do you expect those to be sufficient to offset the cost inflation, or should we expect costs to move up, but with a lower percentage than inflation going forward?

Speaker #5: Hi, look. Thanks for the question. So let me—the mix effects, yes, we mentioned cup cubes. It also means that we utilize our low pressure machines in a higher percentage, which contributes to the margins as well.

Alexander Masharov: Hi, Luc. Thanks for the question. The mix effects. Yes, we mentioned CabCube. It also means that we utilize our low-pressure machines in a higher percentage that contributes to the margins as well. There are more products that are more profitable that we have produced in H1 and also will continue to do in H2. There are more products to come in H2 that I wouldn't like to share here due to competition and competitivity reasons. Yes, we are constantly working on improving our margins and bringing more profitable products into our product mix. It's part of what you see in H1, and that's just an ongoing business. Today, I'm quite proud to say we do not have loss-making products in our Portfolio. We stabilize that all the products that are produced have a certain margin. It differs from one to another.

Speaker #5: There are more products that are more profitable that we have produced in H1, and we will continue to do so in H2. There are more products to come in H2 that I would like to share here.

Speaker #5: Due to competition, for competitiveness reasons. But yes, we are constantly working on improving our margins and bringing more profitable products into our product mix. It's part of what you see in H1.

Speaker #5: And that's just an ongoing business. I am, to be quite proud to say, we do not have loose margin products in our portfolio. So we stabilized that.

Speaker #5: All the products that are produced have certain margins. It differs from one to another. But to the question, the answer is yes, there are more products than just cup cubes.

Alexander Masharov: But the answer is yes, there is more products than just CabCubes that contribute to that. The second question was regarding the cost measures. We are in the Shift program already 18 months, and I think we have been very successful in stabilizing those costs to the percentage and to the right size for our company. We don't have intentions to cut those costs more and more. We try to be more operationally effective and create more efficiencies within our processes. There is no intention to have radical cost restructuring or things like this. I'm quite happy with where the costs are today. I think it's challenging enough in the environment we live in. With inflation, we have to maintain those percentages on those costs. To go further will probably halt our business. What we should do is be more effective, but this is an ongoing effort.

Speaker #5: That contributes to that. The second question was regarding the cost measures. So look, we are in the Shift program already 18 months, and I think we have been very successful in stabilizing those costs to the percentage, and to the right size for our company.

Speaker #5: We do not have intentions to cut those costs more and more. We try to be more operationally effective and create more efficiencies within our processes, and there is no intention to have radical cost restructuring or things like this.

Speaker #5: I'm quite happy with where the costs are today. I think it's challenging enough, in the environment we live in with inflation, to maintain those percentages and those costs.

Speaker #5: To go farther will probably halt our business. What we should do is be more effective, but this is ongoing every time. Hope that answers the question.

Alexander Masharov: Hope that answers the question.

Speaker #6: Yes, and I have two follow-ups, if I may. So, one is on the US, where you sounded a bit more optimistic earlier this year.

Luc Van Beek: Yes. I have two follow-ups, if I may. One is on the US where you sounded a bit more optimistic earlier this year. It looks like you're winning customers, but they are a bit reluctant to already place orders, basically. Is that indeed the case? Do you see a widening of your customer base that does not immediately translate into revenues? Can you indicate when you expect that to start? The second follow-up question is on the maintenance CapEx. You mentioned there's a shift from, say, the investments to the P&L. But if you look at the P&L, the increase is relatively modest compared to the savings you record in your cash flow statement. Is that level sustainable, or should we expect a different pattern going forward?

Luuk van Beek: Yes. I have two follow-ups, if I may. One is on the US where you sounded a bit more optimistic earlier this year. It looks like you're winning customers, but they are a bit reluctant to already place orders, basically. Is that indeed the case? Do you see a widening of your customer base that does not immediately translate into revenues? Can you indicate when you expect that to start? The second follow-up question is on the maintenance CapEx. You mentioned there's a shift from, say, the investments to the P&L. But if you look at the P&L, the increase is relatively modest compared to the savings you record in your cash flow statement. Is that level sustainable, or should we expect a different pattern going forward?

Speaker #6: And it looks like you're winning customers, but they're a bit reluctant to already place orders, basically. Is that indeed the case, or do you see an inviting of your customer base that does not immediately translate into revenues?

Speaker #6: And can you indicate when you expect that to start? And the second follow-up question is on the maintenance capex. You mentioned that there's a shift from, say, the investments to the P&L.

Speaker #6: But if you look at the P&L, the increase is relatively modest compared to the savings you record in your cash flow statement. Is that level sustainable, or should we expect a different pattern going forward?

Alexander Masharov: Let me take the first part of the question, Mark will answer the second. Regarding the US, we are in a transition period in the US. New managing director has just started, and we have reinforced our sales or commercial team in the US with two more people. We already see that there is a better outlook for the future. I wouldn't like to say more about it. There is a lot of focus around the US business. There is a lot of opportunities as we see them. But every change takes a bit of time, and people need to get to know the business. I wouldn't like to elaborate more on that. I'll let Mark to answer you on the CapEx.

Speaker #5: Let me take the first question, and Mark will answer the second. So, regarding the US, we are in a transition period in the US.

Speaker #5: A new managing director has just started, and we have reinforced our sales or commercial team in the US with two more people. We already see that there is a better outlook for the future.

Speaker #5: I wouldn't like to say more about it. There is a lot of focus around the US business. There are a lot of opportunities as we see them.

Speaker #5: But every change takes a bit of time. People need to get to know the business, and I wouldn't like to elaborate more on that.

Speaker #5: I'll let Mark answer you on the capex.

Speaker #3: Yeah, thank you, Alex. And thank you for your question, Luke. So, I think an important message that we want to bring is that we are focusing our capex on growth.

Mark Letterie: Yeah. Thank you, Alex. Thank you for your question, Luke. I think an important message that we want to bring is that we are focusing our CapEx on growth, and we are more disciplined as regards to preemptive repair and maintenance expenditure. In our view, that is sustainable. We are currently investing below depreciation deliberately. That was the case since the Shift program started. Our asset base was built for higher volumes, and we try to fill that now with a better mix. Yeah, foreseeing additional investments in machines.

Speaker #3: And we are more disciplined with regard to preemptive repair and maintenance expenditure. So in our view, that is sustainable. We are currently investing below depreciation.

Speaker #3: Deliberately. And that has been the case since the SHIFT program started. So our asset base was built for higher volumes, and we are trying to fill that now with a better mix.

Speaker #3: And, yeah, foreseeing additional investments in machines. Okay, that's clear.

Luc Van Beek: Okay, that is clear. That's it for now. Thank you.

Luuk van Beek: Okay, that is clear. That's it for now. Thank you.

Speaker #6: That's it for now. Thank you.

Speaker #3: Thank you, Luke.

Mark Letterie: Thank you, Luke.

Speaker #1: Thank you. We will take our next question. The next question comes from the line of Yusama Tariq from ABN AMRO ODDO BHF. Please go ahead.

Operator: Thank you. We will take our next question. The next question comes from the line of Usama Tariq from ABN AMRO ODDO BHF. Please go ahead. Your line is open.

Speaker #1: Your line is open.

Speaker #6: Hi, good morning, team. Thank you for the opportunity. I have two small add-on questions. Firstly, related to the dividend—could you please kindly remind me: is the dividend payment on again from next year, or how is the structure going to be going forward?

Usama Tariq: Hi. Good morning, team. Thank you for the opportunity. I have two small add-on questions. Firstly, related to the dividend, could you please kindly remind me, is from next year the dividend payment again on? Or how is the structure going to be going forward? I believe this year there is a hold on it. My second question would be more in general with regards to new product development. I believe last update was with regards to the Cabka launch of a new circular pallet. Has there been new launches with regards to new product? If you could just elaborate on that front, that would be really nice. Thank you.

Speaker #6: I believe this year there is a hold on it. My second question is more general, with regards to new product development.

Speaker #6: I believe the last update was regarding the OSCAR and CAPCA launch of a new circular pallet. Have there been any new launches with regard to new products?

Speaker #6: If you could just elaborate on that front, that would be really nice. Thank you.

Speaker #5: Thank you so much. And let me take both questions. So, dividends—I think it's a little bit premature for us to speak about it.

Alexander Masharov: Thank you, Usama. Let me take both questions up. So dividend, I think it is a little bit premature for us to speak about it. I would like to see our results come in line with our expectations by the end of the year, and we will make that decision together with the board, I guess towards the end of the year when we will understand the full year results. It is always an open question if the results are good, and it is part of the decision-making. So I am sorry, cannot say at this moment of time. We only see strong results by the end of 2026. On your question regarding product development, this is what we live and breathe every day. Yes, correct. We saw Tosca, cooperation with Tosca starting, and we also had a mutual press conference in October. There are more projects like this in the pipeline.

Speaker #5: I would like to see our results come in line with our expectations by the end of the year, and we'll make that decision together with the board.

Speaker #5: I guess, towards the end of the year, we'll understand the full-year results. And it's always an open question if the results are good.

Speaker #5: And it's part of the decision-making. So, sorry, cannot say at this moment in time. We only see strong results by the end of 2026.

Speaker #5: On your question regarding product development, this is what we live and breathe every day. So yes, correct, we saw post-car cooperation with Tosca starting, and we also had a mutual press conference in October.

Speaker #5: There are more projects like this in the pipeline. I hope that in November, in our commercial market update, we can reveal more of those.

Alexander Masharov: I hope in November, in our commercial market update, we can reveal more of those. This is something we constantly do. This is our customer development program. But I cannot share more details, sorry, Usama, because it is just very sensitive from a competition standpoint.

Speaker #5: But this is something we constantly do. This is our customer development program. But I cannot share more details, sorry Osama, because it's just very sensitive from a competition standpoint.

Speaker #6: Thank you. That will be all.

Usama Tariq: Thank you. That would be all.

Speaker #1: Thank you. We will take our next question. Your next question comes from the line of Luke Van Beek from Degroof Petercam. Please go ahead.

Operator: Thank you. We will take our next question. Your next question comes from the line of Van Beek from Degroof Petercam. Please go ahead. Your line is open.

Operator: Thank you. We will take our next question. Your next question comes from the line of Luuk van Beek from Degroof Petercam. Please go ahead. Your line is open.

Speaker #1: Your line is open.

Speaker #6: Yes, I have a couple of further follow-on questions. One is on the widening gap between virgin materials and recycled materials. Do you see that leading to more competition for the raw material?

Luc Van Beek: Yes. I have a couple of further follow-on questions. One is on the widening gap between the virgin materials and the recycled materials. Do you see that that leads to more competition for the raw material, so the plastic waste? Does it impact your tipping fees? Secondly, can you give a rough indication of the revenue growth split by price and volume in H1? Finally, you mentioned that the Packaging and Packaging Waste Regulation has started yesterday. Customers have postponed preparing for that, until now, I guess. Do you see that they are now starting to move now that it is really in effect?

Luuk van Beek: Yes. I have a couple of further follow-on questions. One is on the widening gap between the virgin materials and the recycled materials. Do you see that that leads to more competition for the raw material, so the plastic waste? Does it impact your tipping fees? Secondly, can you give a rough indication of the revenue growth split by price and volume in H1? Finally, you mentioned that the Packaging and Packaging Waste Regulation has started yesterday. Customers have postponed preparing for that, until now, I guess. Do you see that they are now starting to move now that it is really in effect?

Speaker #6: So, the plastic waste—does that have an impact on your tipping fees? And secondly, can you give a rough indication of the revenue growth split by price and volume in H1?

Speaker #6: And then, finally, you mentioned that the BPWR has started yesterday. Do you see that customers have postponed preparing for that—well, until now, I guess—but do you see that they are now starting to move, now that it's really in effect?

Speaker #5: Well, let me start from the last question. There is simply a BPWR kicked in yesterday. Of course, there is a timeline to that. So if we see immediately a commercial effect, people jumping on orders—no.

Alexander Masharov: Well, let me start from the last question very simply. The Packaging and Packaging Waste Regulation kicked in yesterday. Of course, there is a timeline to that. If we see immediately a commercial effect, people jumping on all this, no, unfortunately not. I think companies are in the process, preparing, executing. As I said, it helps us, but it is not something that we believe is going to affect massively H2, for example, or the coming even year. It is a progress. It is something that we do, and we support all our customers through the journey. To your first question regarding recycled materials and raw materials, we do not have any effect from the tipping fee standpoint. We do have slightly, people who are dependent on virgin products, they do postpone part of the decision-making due to the go for products that are more recycled content.

Speaker #5: Unfortunately, not. I think companies are in the process of preparing and executing. It's part of the, as I said, it helps us, but it's not something that we believe is going to affect massively H2, for example, or even the coming year.

Speaker #5: It's a progress. It's something that we do, and we support all our customers through the journey. To your first question regarding recycled materials and raw materials, we don't have any effect from the tipping fees standpoint.

Speaker #5: We do have slightly more people who are dependent on virgin products. They do postpone part of the decision-making due to the Gulf War. For products that have more recycled content, we haven’t seen a big effect due to the raw material pricing.

Alexander Masharov: We haven't seen a big effect due to the raw material pricing. There was a price increase. We were quite fair with our customers when those raw materials went up, whether virgin or we went with pricing up, but when the prices went down, we went down. We were very open, and we were very transparent. The second question, I think, Mark, if you can jump in and answer. Alex said that is on the pricing?

Speaker #5: There was a price increase we were quite fair with our customers when those raw materials went up, whether virgin or we went with pricing up when the prices went down, we went down.

Speaker #5: So, we were very open and we were very transparent. And the second question, I think Mark, if you can jump in and answer.

Speaker #3: And Alex, that is on the pricing.

Mark Letterie: Alex said that is on the pricing?

Speaker #6: Yeah, price volume.

Luc Van Beek: Yeah, price volume.

Luuk van Beek: Yeah, price volume.

Speaker #3: Yeah, so as Alex mentioned, we did change our pricing once we saw a significant impact on the material cost. But we also changed it back down.

Mark Letterie: Yeah. As Alex mentioned, we did change our pricing once we saw a significant impact on the material cost, but we also changed it back down. Actually, the timing of our price increase was at the start of May. The orders that were coming in in the H1, they're not a significant part of the results yet, but there will be a little bit more effect from that in Q3. So on the half year results, there is a very limited effect from pricing.

Speaker #3: Actually, the timing of our price increase was at the start of May. So the orders that were coming in during the first half of the year are not a significant part of the results yet.

Speaker #3: But there will be a little bit more effect from that in Q3. So, on the half-year results, there is a very limited effect from pricing.

Speaker #6: Okay, and can you give a rough indication of the price increases in May? How much was it?

Luc Van Beek: Okay. Can you give a rough indication of the price increases in May, how much it was?

Luuk van Beek: Okay. Can you give a rough indication of the price increases in May, how much it was?

Mark Letterie: Yes. We actually did a price increase on material, where for the virgin materials, we had a more significant increase of around EUR 6 per ton, or a little bit more actually. On the recycled materials, we had a much smaller increase. And actually the virgin material surcharges, we were able to reverse because the material cost had stabilized and had normalized. So we have still a small increase on the recycled material side, but no longer on the virgin material.

Speaker #3: Yeah, so we actually did a price increase on material, where for the virgin materials we had a more significant increase—of around six, yeah, six euros per ton.

Speaker #3: A little bit more, actually. On the recycled materials, we had a much smaller increase. And actually, the virgin material surcharge we were able to reverse because the material cost had stabilized and normalized.

Speaker #3: So, we still have a small increase on the virgin material side, but no longer on the recycled material side, and no longer on the virgin material.

Speaker #6: Okay, thank you.

Luc Van Beek: Okay. Thank you.

Luuk van Beek: Okay. Thank you.

Speaker #1: Thank you. There seem to be no further questions from the audio. I would like to hand back to the room for the webcast questions.

Operator: Thank you. There seems to be no further questions from the audio. I would like to hand back to the room for the webcast questions.

Speaker #5: Thank you. I'll read them out. We have a few questions that I see. Number one: recyclers have reportedly been more competitive lately due to higher fossil virgin prices.

Alexander Masharov: Thank you. I will read them out. We have a few questions that I see. Number 1 is, recyclers have reportedly been more competitive lately due to higher fossil virgin prices. Why does not that seem to apply to Cabka? Well, yes, we do see that relative advantage. Virgin polymer prices rose much more sharply than recycled grades. With 83% of our raw material intake coming from recycled material, Cabka was comparatively better insulated. There is an important distinction. We are not selling recycled resin. We sell Reusable Transport Packaging, often through project, tender-based or some customer decision. So even if the relative economics of recycled material improve, that does not translate immediately into higher orders. That is the main issue.

Speaker #5: Why doesn’t that seem to apply to Cabka? Well, yes, we do see that relative advantage. Virgin polymer prices rose much more sharply than recycled grades.

Speaker #5: And with 83% of our raw material intake coming from recycled material, Cabka was comparatively better in solidate. But there is an important distinction: we are not selling recycled bins.

Speaker #5: Resin. We sell reusable transport packaging, often through project tenders or based on some customer decision. So even if the relative economics of recycled material improve, that doesn't translate immediately into higher orders.

Speaker #5: That's the main issue. In Q2, the broader uncertainty actually caused some customers to delay their investments because, even if price increases are in the virgin material, they usually translate slightly later into recycled materials.

Alexander Masharov: In Q2, the broader uncertainty actually caused some customers to delay the investments, because even if the price increases are in the virgin material, it usually translates slightly later into recycled material. Everyone was a bit more cautious. The material advantage is there. The timing of when that translates into revenue is slightly different, and I hope that answers the question. Yes, we have one more question. Am I correct that you managed to hire a new CEO in the US and a new Chief Commercial Officer? Can you elaborate on their background? Yes, great question. Just one clarification first. In the US, we appointed a new Managing Director. She started on 1 July, and we have also strengthened the commercial organization and sales leadership. The profile of our new MD is deliberately more commercially oriented. She comes from a big business.

Speaker #5: So, everyone was a bit more cautious. So the material advantage is there. The timing of when that translates into revenue is slightly different. And I hope that answers the question.

Speaker #5: Yes, we have one more question. Am I correct that you managed to hire a new CEO in the US? And a new Chief Commercial Officer? Can you elaborate on their background?

Speaker #5: Yes, great question. Just one clarification first: in the US, we appointed a new Managing Director. She started on July 1st, and we have also strengthened the commercial organization and sales leadership.

Speaker #5: The profile of our new MD is deliberately more commercially oriented. She comes from a business. We are in a turnaround phase there, in the US, and what we need now is a stronger customer proximity.

Alexander Masharov: We are in a turnaround phase there in the US, and what we need now is stronger customer proximity. This is why the new Managing Director was hired. She has better commercial execution and improved utilization of the business we are in from her past, and that is what we are looking for. The same logic applies to the additions on the commercial side we have done. We want people who can build the pipeline, convert those opportunities into growth, both in our core Portfolio and Customized Solutions. Yes, we have added two more FTEs with a very strong commercial background to add. It is still early days, but we are encouraged by the direction, and we will give a more detailed update on US at our capital market update in November. I think we will have sufficient information by then. Yes, and they need other employment.

Speaker #5: This is why the new Managing Director was hired. She has better commercial execution and has improved utilization of the business we are in from her past experience.

Speaker #5: And that's what we are looking for. The same logic applies to the additions on the commercial side we've made. We want people who can build the pipeline and convert those opportunities into growth.

Speaker #5: Both in our corporate portfolio and customized solutions. So yes, we have added two more FTEs with a very strong commercial background. To add, it is still early days, but we are encouraged by the direction.

Speaker #5: And we will give a more detailed update on the US at our Capital Market Update in November. I think we'll have sufficient information by then.

Speaker #5: Yes, and they did start their employment. Sorry, that was another— I don't see any more questions coming from our webcast, am I right? All right.

Alexander Masharov: Sorry, that was not there. I do not see any more questions coming from our webcast. Am I right? All right. With this, I would like to thank you all for joining in and listening in for our update. If there are no more further questions, we will end up this session, and we are looking forward to share with you more information on our capital market update in November. Thank you. Back to the operator.

Speaker #5: So with this, I would like to thank you all for joining in and listening to our update. If there are no further questions, we'll end this session, and we're looking forward to sharing more information with you on our capital market update in November.

Speaker #5: Thank you. Back to the operator.

Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.

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Half Year 2026 Cabka NV Earnings Call

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