Half Year 2026 D'Ieteren Group SA Earnings Call

September 9, 2026

Speaker #1: Ladies and gentlemen, welcome to the D'Ieteren Group 2026 half-year results conference call. Throughout the call, all participants will be in listen-only mode, and afterwards there will be a question-and-answer session.

Operator: Ladies and gentlemen, welcome to D'Ieteren Group 2026 H1 results conference call. Throughout the call, all participants will be in listen-only mode, and afterwards there will be a question and answer session. Please note this call is being recorded. Today, I am pleased to present Francis Deprez, CEO, and Edouard Janssen, CFO. Gentlemen, please go ahead.

Speaker #1: Please note this call is being recorded. Today, I'm pleased to present Frances Depré, CEO, and Edward Jensen, CFO. Gentlemen, please go ahead.

Speaker #3: Good evening, ladies and gentlemen. Welcome to our Half-Year 2026 Results Conference Call. Let me start with the main messages I want to convey today.

Francis Deprez: Well, good evening, ladies and gentlemen. Welcome to our H1 2026 results conference call. Let me start with the main messages we want to convey today. First, D'Ieteren Group delivered a robust H1 2026. Our key performance indicator, adjusted profit before tax group share grew by 8.4% at constant foreign exchange rates. This performance reflects strong growth at Belron, PHE, and TVH, and is notably driven by lower financial charges providing further uplifts. This was partly offset by the challenging environment at D'Ieteren Automotive. In addition, cash generation remains solid with trading cash flow group share increasing by close to 12% to EUR 539 million, mainly driven by Belron. Free cash flow group share stood broadly around breakeven, reflecting acquisition spend at PHE, notably in Spain, and largely compensated by Belron's very strong free cash flow generation, which grew by 89% year-on-year.

Speaker #3: First, D'Ieteren Group delivered a robust first half of 2026. Our key performance indicator, adjusted profit before tax group share, grew by 8.4% at constant foreign exchange rates.

Speaker #3: And this performance reflects strong growth at Belron, PHE, and TVH, and is notably driven by lower financial charges, providing further uplift. It was partly offset by the challenging environment at D'Ieteren Automotive.

Speaker #3: In addition, cash generation remains solid, with trading cash flow group share increasing by close to 12%, to $539 million, mainly driven by Belron. Free cash flow group share stood broadly around break-even, reflecting acquisition spend at PHE.

Speaker #3: Notably in Spain, and largely compensated by Belron's very strong free cash flow generation, which grew by 89% year-on-year. Second, we confirm our full-year 2026 outlook.

Francis Deprez: Second, we confirm our full year 2026 outlook. We continue to expect low to mid-single digits year-on-year growth in adjusted profit before tax group share at constant exchange rates. The trends at D'Ieteren Automotive weakened throughout the first semester of the year and are not expected to improve in the second half. Yet the impact of this evolution is expected to be partially offset in the second semester by the other businesses. Third, we also announced that the shareholders in Belron are currently evaluating strategic options regarding the minority shareholder stakes in the company. Those options include, amongst others, a potential listing of Belron. I want to be clear on where we stand. No decision has been made at this stage, neither on any specific option nor on its timing. Let me be equally clear on our position. D'Ieteren Group's long-term commitment to Belron remains unchanged.

Speaker #3: We continue to expect low- to mid-single-digit year-on-year growth in adjusted profit before tax, group share, at constant exchange rates. The trends at D'Ieteren Automotive weakened throughout the first semester of the year and are not expected to improve in the second half. Yet, the impact of this evolution is expected to be partially offset in the second semester by the other businesses.

Speaker #3: Third, we also announced that the shareholders are considering strategic options regarding the minority shareholder stakes in the company. Those options include, among others, a potential listing of Belron.

Speaker #3: I want to be clear on where we stand: no decision has been made at this stage, neither on any specific option nor on its timing.

Speaker #3: And let me be equally clear on our position: D'Ieteren Group's long-term commitment to Belron remains unchanged. We remain fully supportive of its management team as they continue to execute on a profitable growth trajectory.

Francis Deprez: We remain fully supportive of its management team as they continue to execute on a profitable growth trajectory. As this process is ongoing, you will understand that we are not in a position to comment further today, and we will not also be taking any questions on this specific topic. We will keep the market informed in line with our disclosure obligations as the matters develop. Then there is the other piece of news on our CEO transition that you may have read in the press releases. For obvious reasons, I will not comment on that. All I can say is I have had a good ride over the past 10 years. Now, before we dive into details, let me highlight the key elements of the semester.

Speaker #3: And as this process is ongoing, you'll understand that we will not be in a position to comment further today, and we will also not be taking any questions on the specific topic.

Speaker #3: We'll keep the market informed in line with our disclosure obligations as matters develop. And then there's the other piece of news on our CEO transition that you may have read in the press releases.

Speaker #3: For obvious reasons, I will not comment on that. All I can say is I've had a good ride over the past 10 years. Now, before we dive into the details, let me highlight the key elements of the semester.

Speaker #3: At the group level, I already mentioned the 8.4% growth in our KPI at constant exchange rates and the close-to-12% growth in trading cash flow, group share.

Francis Deprez: At the group level, I already mentioned the 8.4% growth in our KPI at constant exchange rates and the close to 12% growth in trading cash flow group share. Also, as previously said, we are confirming our full year 2026 outlook based on the strong H1 results and the expected resilience of our portfolio year. Belron delivered another strong performance in the first half, a top line growth of 8.3% and adjusted operating profit growth of 16.5% at constant FX, which is 160 basis point year-on-year improvement in its adjusted operating margin, which reaches 23%. The adjusted profit before tax group share increased even by 32.5% at constant FX to EUR 306 million, further supported by lower financial charges. Second is D'Ieteren Automotive, clearly facing a challenging environment. The Belgian new car market was down by 2.4% and the market share of D'Ieteren Automotive declined to 21.5%.

Speaker #3: Also, as previously said, we're confirming our full-year 2026 outlook based on the strong H1 results and the expected resilience of our portfolio for the year.

Speaker #3: Belron delivered another strong performance in the first half, with top-line growth of 8.3% and adjusted operating profit growth of 16.5% at constant FX. This represents a 160 basis point year-on-year improvement in its adjusted operating margin, which reached 23%.

Speaker #3: The adjusted profit before tax group share increased even by 32.5% at constant FX, to €306 million, further supported by lower financial charges. Second, D'Ieteren Automotive is clearly facing a challenging environment.

Speaker #3: The Belgian new car market was down by 2.4%, and the market share of D'Ieteren Automotive declined to 21.5%. As a result, sales decreased by 10.8%, and the adjusted operating margin actually fell to 2.1%.

Francis Deprez: As a result, the sales decreased by 10.8% and the adjusted operating margin actually to 2.1%. The adjusted profit before tax group share was down two-thirds after a record year in 2025. To adapt the organization to a rapidly changing market environment characterized by increased competition, changing regulations, increased digitalization, and the evolution of mobility practices of consumers, D'Ieteren Automotive has announced last week to the Works Council its intention to implement a transformation plan, which could result in the loss of 344 jobs. PHE then continues on its compounding growth trajectory, with sales up 10.4%, including 6% organic growth driven by market share gains and 4.4% from acquisitions. This includes the acquisitions of two large AD Parts distributors in Spain, which closed at the end of May.

Speaker #3: The adjusted profit before tax group share was down two-thirds after a record year in 2025. To adapt the organization to a rapidly changing market environment—characterized by increased competition, changing regulations, increased digitalization, and the evolution of mobility practices of consumers—D'Ieteren Automotive announced last week to the works council its intention to implement a transformation plan, which could result in the loss of 344 jobs.

Speaker #3: PHE then continued on its compounding growth trajectory, with sales up 10.4%, including 6% organic growth driven by market share gains, and 4.4% from acquisitions.

Speaker #3: This includes the acquisitions of two large Adeparts distributors in Spain, which closed at the end of May. The adjusted operating margin reached 9.6%, and adjusted profit before tax group share increased by 18.4% to €107 million, now representing about 22% of the group KPI.

Francis Deprez: The adjusted operating margin reached 9.6% and adjusted profit before tax group share increased by 18.4% to EUR 107 million, now representing about 22% of the group KPI. TVH posted a very solid top-line growth, sales up 7.7% at constant FX, supported by positive volume trends in almost all the regions and equipment markets. The adjusted operating profits increased by 3.7% at constant FX, reflecting the benefit from volume growth, partly offset by subdued pricing and cost inflation, notably in freight. The adjusted operating margin stood at 13.7%, and the PBT adjusted group share number increased by 16.9% year on year, also supported by lower financial charges. Last, Moleskine. As you know, H2 remains seasonally more important.

Speaker #3: And then TVH posted very solid top-line growth, with sales up 7.7% at constant FX, supported by positive volume trends in almost all the regions and equipment markets.

Speaker #3: The adjusted profits increased by 3.7% at constant FX, reflecting the benefit from volume growth, partly offset by subdued pricing and cost inflation, notably in freight.

Speaker #3: Now, the adjusted operating margins stood at 13.7%, and the adjusted PBT group share number increased by 16.9% year-on-year, also supported by lower financial charges.

Speaker #3: And then last, Moleskine. As you know, H2 remains seasonally more important, but in H1, we showed encouraging signs of recovery with 6.2% organic sales growth, and the adjusted PBT group share of Moleskine improved to minus €4.7 million, helped by lower financial charges as well.

Francis Deprez: But in H1, we showed encouraging signs of recovery with a 6.2% organic sales growth, and the adjusted PBT group share of Moleskine improved to EUR -4.7 million, helped by lower financial charges as well. I will now hand over to Edouard to walk you through the group's KPI and financials in more detail.

Speaker #3: I will now hand over to Édouard to walk you through the group's KPIs and financials in more detail.

Speaker #1: Thank you, Francis. As you mentioned, our headline KPI, adjusted PBT group share, increased by 6.6% year-on-year on a reported basis, from €452 million in H1 2025 to €482 million in H1 2026.

Edouard Janssen: Thank you, Francis. As you mentioned, our headline KPI, adjusted PBT group share, increased by 6.6% year on year on a reported basis from EUR 452 million in H1 in 2025 to EUR 482 million in H1 2026. At constant exchange rates, growth was 8.4% year on year. As shown in the bridge, all segments except D'Ieteren Automotive contributed to the increase. The largest contribution came from Belron. Its adjusted PBT group share increased by EUR 75 million, supported both by strong operational performance and lower financial charges. PHE contributed an additional EUR 16.6 million year on year, TVH EUR 7 million, and Moleskine improved by EUR 2.9 million. Finally, corporate and unallocated also improved by EUR 8.2 million, mainly thanks to lower financial charges following the early repayment of the bridge loan in June 2025.

Speaker #1: At constant exchange rates, growth was 8.4% year-on-year. As shown in the bridge, all segments except D'Ieteren Automotive contributed to the increase. The largest contribution came from Belron.

Speaker #1: Its adjusted PBT group share increased by 75 million euro, supported both by strong operational performance and lower financial charges. PHE contributed an additional 16.6 million euro year-on-year, TVH 7 million, and Moleskine improved by 2.9 million euro.

Speaker #1: Finally, corporate and unallocated also improved by €8.2 million, mainly thanks to lower financial charges following the early repayment of the bridge loan in June 2025.

Speaker #1: This was partly offset by D'Ieteren Auto, where adjusted PBT group share declined by €72.7 million, in a difficult market environment already described by Francis, marked by a combination of lower volumes, negative price mix, tighter distribution margins, and negative operating leverage.

Edouard Janssen: This was partly offset by D'Ieteren Auto, where adjusted PBT group share declined by EUR 72.7 million in a difficult market environment already described by Francis, marked by a combination of lower volumes, negative price mix, tighter distribution margins, and negative operating leverage. Turning to the rest of our group share financials, sales amounted to EUR 6.1 billion, broadly stable year-on-year, up 0.7% at constant FX. Solid growth at Belron, PHE, TVH, and Moleskine was offset by the decline at D'Ieteren Auto. Adjusted operating result group share was broadly stable at EUR 663 million, or up 2.2% at constant FX. This again reflects strong operating growth at Belron and PHE, an increase at TVH, and the material decline at D'Ieteren Auto. Trading cash flow group share increased by 12% to EUR 539 million. Free cash flow group share stood close to break even.

Speaker #1: Turning to the rest of our group shared financials, sales amounted to €6.1 billion, broadly stable year-on-year, up 0.7% at constant FX. There was solid growth at Belron, PHE, TVH, and Moleskine, but this was offset by the decline at D'Ieteren Auto.

Speaker #1: Adjusted operating result group share was broadly stable at €663 million, or up 2.2% at constant FX. This, again, reflects strong operating growth at Belron and PHE, an increase at TVH, and the material decline at D'Ieteren Auto.

Speaker #1: Trading cash flow, group share, increased by 12% to €539 million. Free cash flow, group share, stood close to breakeven. Let's flag that the close to €150 million spent on mainly Spanish acquisitions at PHE was largely offset by the progression of Belron's free cash flow generation.

Edouard Janssen: Let's flag that the close to EUR 150 million spent on mainly Spanish acquisitions at PHE was largely offset by the progression of Belron's free cash flow generation. Moving to the group's financial position, the net financial debt of the corporate and unallocated segments stood at close to EUR 300 million at the end of June 2026, and slightly increased versus the end of December 2025. Excluding inter-segment loans, corporate and unallocated net financial debt was EUR 486.6 million. This includes the impact of the EUR 76 million waiver on the shareholder loan to Moleskine in the H1 2026, following last year's impairment charge and aligned with Italian statutory accounting rules. For the rest, the evolution over the semester mainly reflects cash outflows relating to the dividend paid to D'Ieteren Group shareholders, share buybacks, and the free cash flow consumption at the corporate level.

Speaker #1: Moving to the Group's financial position, the net financial debt of the corporate and unallocated segments stood at close to €300 million at the end of June 2026, and slightly increased versus the end of December 2025.

Speaker #1: Excluding inter-segment loans, corporate and unallocated net financial debt was €486.6 million. This includes the impact of the €76 million waiver on the shareholder loan to Moleskine in the first half of 2026, following last year's impairment charge and aligned with Italian statutory accounting rules.

Speaker #1: For the rest, the evolution over the semester mainly reflects cash outflows relating to the dividend paid to D'Ieteren Group shareholders, share buybacks, and the free cash flow consumption at the corporate level.

Speaker #1: These outflows were partly offset by dividends received from D'Ieteren Auto, Belron, and TVH. Now, let me hand over to you, Francis, to talk about the latest developments across the Group.

Edouard Janssen: These outflows were partly offset by dividend received from D'Ieteren Auto, Belron, and TVH. Now let me hand over to you, Francis, to talk about the latest developments across the group.

Speaker #3: Thank you, Édouard. As well, at group level, we continue to actively support our businesses across their strategic priorities, including M&A execution, financing, leadership transactions at PHE, TVH, Moleskine, and also ESG and IT.

Francis Deprez: Thank you, Edouard. At group level, we continue to actively support our businesses across their strategic priorities, including M&A executions, financing, leadership transactions at PHE, TVH, Moleskine, and also ESG and IT. Belron very much continued its focus on operational execution across all the strategic priorities across all the regions, and the famous Best of Belron competition, which celebrates technicians across the globe, took place in June in Lisbon again this year with a winner from Germany. D'Ieteren Automotive, as stated earlier, announced to the Works Council on 3 September its intention to implement a transformation plan designed to adapt the company to the profound changes affecting the automotive and mobility market. The business also recognized a EUR 47.2 million impairment charge on the retail to the dealerships, fully allocated to goodwill.

Speaker #3: Belron very much continued its focus on operational execution across all the strategic priorities, across all the regions, and the famous Best of Belron competition—which celebrates technicians across the globe—took place in June in Lisbon again this year, with a winner from Germany.

Speaker #3: D'Ieteren Automotive, as stated earlier, announced at the Works Council on September 3rd its intention to implement a transformation plan designed to adapt the company to the profound changes affecting the automotive and mobility market.

Speaker #3: The business also recognized a €47.2 million impairment charge on the retail, so the dealerships, fully allocated to goodwill. At PHE, the acquisition of 51% stakes in the two Audi parts distributors, mainly in Madrid and Galicia.

Francis Deprez: At PHE, the acquisition of the 51% stake in the two AD Parts distributors, mainly in Madrid and Galicia that Edouard mentioned, was completed at the end of May, reinforcing its leading position in Spain. PHE also strengthened its leadership team, Lilian Leroux joining as the Group Deputy CEO, and Cyril Flamant appointed Group CFO. At TVH, Giuliano Parodi started as CEO on 1 September, bringing new leadership to the business as it continues to execute its focused growth and operational priorities. At Moleskine, Silvano Sala Tescat took over as CFO on 1 September as well. Now let's run through the performance of each of the businesses, starting with Belron. It delivered another strong H1, driven by growth across all the regions, higher total job volume, increasing windscreen value, and growth in recalibration and value-added products and services.

Speaker #3: That Édouard mentioned was completed at the end of May, reinforcing its leading position in Spain. PHE also strengthened its leadership team, with Clément Leroux joining as group Deputy CEO and Cyril Flamant appointed as Group CFO.

Speaker #3: And at TVH, Giuliano Parodi started as CEO on September 1, bringing new leadership to the business as it continues to execute its focused growth and operational priorities.

Speaker #3: And at Moleskine, Silvano Salateschiat took over as CFO on the 1st of September as well. Now, let's run through the performance of each of the businesses.

Speaker #3: Starting with Belron, it delivered another strong first half, driven by growth across all the regions, higher total job volume, increasing windscreen value, and growth in recalibration and value-added products and services.

Speaker #3: Sales, as a result, increased by 8.3% year-on-year at constant exchange rates, or 4.7% on a reported basis. The adjusted operating profit reached €820 million, up 12.3% on a reported basis and 16.5% at constant FX, with an adjusted operating margin of 23% for the first semester.

Francis Deprez: The sales, as a result, increased by 8.3% year-on-year at constant exchange rates or 4.7% on a reported basis. The adjusted operating profit reached EUR 820 million, up 12.3% on a reported basis and 16.5% at constant FX, with an adjusted operating margin at 23% for the first semester. The adjusted profit before tax group share increased by 28.6% to EUR 308 million, supported by the strong operational performance and lower financial charges. Free cash flow increased by 89% to EUR 485 million, and the company distributed a EUR 194 million interim dividend to its shareholders. Belron also continues its deleveraging path. The leverage has now decreased to 4.3 times and its financing conditions have continued to improve. Now, looking first at the top line, the organic growth was 7.3%, which is driven by a 3.9% increase in total volume, job volumes, total job volumes, exactly.

Speaker #3: And the adjusted profit before tax group share increased by 28.6% to €308 million, supported by strong operational performance and lower financial charges. Free cash flow increased by 89% to €485 million, and the company distributed a €194 million interim dividend to its shareholders.

Speaker #3: Belron also continues its deleveraging path. The leverage has now decreased to 4.3 times, and its financing conditions have continued to improve. Now looking first at the top line, the organic growth was 7.3%, which is driven by a 3.9% increase in total volume, job volumes, total job volumes, exactly, favorable price mix, including continued increase in widescreen windscreen value, and a positive sales contribution from the VAPS.

Francis Deprez: Favorable price mix, including continued increase in windscreen value and a positive sales contribution from the VAPs. The company also has 0.7% growth from acquisitions and there was an adverse currency translation effect of 3.3%. The growth was actually broad-based across the regions. North America, which as you know represents more than half of its sales, delivered a 9.4% organic growth, reflecting successful execution of strategic priorities and improving demand in the insurance segment. The Eurozone and the rest of the world also delivered positive organic growth. Belron also continues to benefit from increasing vehicle glass complexity and recalibration penetration, which is now at 52.1%. You have to compare that to the 49, sorry to the 45.9% of H1 of last year. The VAP detachment rate is remained high at 24.6%.

Speaker #3: The company also had 0.7% growth from acquisitions, and there was an adverse currency translation effect of 3.3%. The growth was actually broad-based across the regions. North America, which, as you know, represents more than half of its sales, delivered a 9.4% organic growth, reflecting successful execution of strategic priorities and improving demand in the insurance segment.

Speaker #3: The Eurozone and the rest of the world also delivered positive organic growth. And then Belron also continued to benefit from increasing vehicle glass complexity and recalibration penetration, which is now at 52.1%.

Speaker #3: You have to compare that to the 45.9% of H1 of last year, and the VAPS attachment rate has remained high at 24.6%.

Speaker #3: Now, the strong top-line performance, combined with operational execution and positive operating leverage, drove the 160 basis point margin expansion to 23%. The adjusted operating result at constant FX was 60.5% higher year-on-year, and the company further benefited from lower financial charges related to the repricing of the term loans, ongoing deleveraging, and the leverage step-down credit booked in the first half of the year.

Francis Deprez: Now, the strong top line performance, combined with operational execution and positive operating leverage, drove the 160 basis point margin expansion to 23%. The adjusted operating result at constant FX was 60.5% higher year-on-year, and the company further benefited from the lower financial charges related to the repricing of the term loans, the ongoing deleveraging, and the leverage step-down credits booked in the H1 of the year. The free cash flow was very strong, EUR 485 million, up 89%, as I mentioned, year-on-year, driven by operating performance, working capital inflow, lower cash taxes, and lower cash outflow from adjusting items. The trading cash flow conversion remained high at 89%.

Speaker #3: The free cash flow was very strong, at €485 million, up 89% year-on-year as I mentioned, driven by operating performance, working capital inflow, lower cash taxes, and lower cash outflow from adjusting items. The trading cash flow conversion remained high at 89%.

Speaker #3: The net financial debt decreased to €8.34 billion at the end of June, and Belron pursued its deleveraging trajectory, with the senior secured net leverage ratio remaining at 4.3 times compared to the 4.5 times where we stood at the end of 2025.

Francis Deprez: The net financial debt decreased to EUR 8.34 billion at the end of June, and Belron pursued its deleveraging trajectory with the senior secured net leverage ratio continued at 4.3x compared with the 4.5x where we stood at the end of 2025. Edouard will now discuss the performance of D'Ieteren Automotive.

Speaker #3: Édouard will now discuss the performance of D'Ieteren Automotive.

Speaker #1: Yes, thanks, Francis. After two record years, D'Ieteren Automotive faced a much more challenging first half in 2026. I'll dig into that in just a minute.

Edouard Janssen: Yes. Thanks, Francis. After two record years, D'Ieteren Automotive faced a much more challenging H1 in 2026. I will dig into that in just a minute. Sales declined by close to 11% year-on-year, and together with negative operating leverage in tight distribution margins, led to a significant decline in adjusted operating profit to EUR 47 million. The negative operating leverage hit particularly hard in retail. Free cash flow improved versus H1 2025, but remained negative at -EUR 34 million, and the company's leverage ratio reached 1.7x at the end of June. Now, taking a quick view at the market, the pace of change since COVID is quite clear, with a slight market decline year-on-year and loss of market share for D'Ieteren Auto in the H1.

Speaker #1: Sales declined by close to 11% year-on-year, and, together with negative operating leverage and tight distribution margins, led to a significant decline in adjusted operating profit to €47 million, particularly hard in retail.

Speaker #1: Free cash flow improved versus H1 2025 but remained negative at minus €34 million. The company's leverage ratio reached 1.7 times at the end of June.

Speaker #1: Now, taking a quick view at the market, the pace of change since COVID is quite clear, with a slight market decline year-on-year and a loss of market share for D'Ieteren Auto in the first half.

Speaker #1: We also see the continued decarbonization of the Belgian fleet, with new energy vehicles now representing 57% of new registrations in Belgium, as well as a normalization of the biomix towards a growing share of private customers, where the AIR has less exposure, also in retail.

Edouard Janssen: We also see the continued decarbonization of the Belgian fleet, with new energy vehicles representing now 57% of new registration in Belgium, as well as a normalization of the bio mix towards a growing share of private customers where D'Ieteren Automotive has less exposure also on retail. These top-line pressures, combined with negative operating leverage and tighter distribution margins, led to a material decline in the bottom line. The adjusted operating margin declined to 2.1% from 4.5% in H1 2025, which was still exceptionally strong. The reported operating result was also impacted by a EUR 47 million impairment charge on retail, fully allocated to goodwill as a result of a lower than anticipated performance. Adjusted profit before tax group share declined by 67% to EUR 36 million. Although the contribution from any equity accounted entities improved, notably thanks to Volkswagen D'Ieteren Finance.

Speaker #1: These top-line pressures, combined with negative operating leverage and tighter distribution margins, led to a material decline in the bottom line. The adjusted operating margin declined to 2.1% from 4.5% in H1 2025.

Speaker #1: Which was still exceptionally strong. The reported operating result was also impacted by a €47 million impairment charge on retail, fully allocated to goodwill as a result of lower-than-anticipated performance.

Speaker #1: Adjusted profit before tax group share declined by 67% to 36 million euro, although the contribution from any equity accounted entities improved, notably thanks to Volkswagen D'Ieteren Finance.

Speaker #1: As mentioned earlier, last week, D'Ieteren Auto has announced its intention to implement a transformation plan to adapt the company to the profound changes that are currently shaping the automotive and mobility market.

Edouard Janssen: As mentioned earlier, last week, D'Ieteren Auto has announced its intention to implement a transformation plan to adapt the company to the profound changes that are currently shaping the automotive and mobility market. Such project could lead to the suppression of more than 340 jobs. More broadly, D'Ieteren Auto is also scrutinizing its whole cost base and in parallel is accelerating its 2030 strategy based on providing an integrated mobility ecosystem throughout the vehicle life cycle. On the free cash flow side, it has improved year-on-year to -EUR 34 million, mainly due to a modest working capital inflow compared with a significant outflow last year, partly offset by the weaker operating performance. Net financial debt increased to EUR 409 million at the end of June, mainly reflecting the distributions to the corporate segment, free cash flow consumption, and higher lease liabilities. Francis will now develop the PHE results.

Speaker #1: Such projects could lead to the suppression of more than 340 jobs, more broadly, D'Ieteren Auto is also scrutinizing its whole cost base and, in parallel, is accelerating its 2030 strategy based on providing an integrated mobility ecosystem throughout the vehicle lifecycle.

Speaker #1: On the free cash flow side, it has improved year-on-year to minus 34 million euro, mainly due to a modest working capital inflow compared with a significant outflow last year, partly offset by the weaker operating performance.

Speaker #1: Net financial debt increased to 409 million at the end of June, mainly reflecting the distributions to the corporate segment, free cash flow consumption, and higher lease liabilities.

Speaker #1: Francis, we'll now develop the P&G results.

Speaker #3: Thank you, Édouard. So yes, on P&G, it's continued its growth trajectory in the first half of '26, combining solid growth and good operating leverage.

Francis Deprez: Thank you, Edouard. So yes, on PHE, it continued its growth trajectory in H1 2026, combining solid growth and good operating leverage. At the end of May, PHE announced the closing of the transactions on majority stakes in two AD Parts distributors, Polaris and Reguera. There is one month's contribution from these in this half year number. Trading cash flows stood at EUR 45 million, and leverage increased moderately following the additional financing raised to fund the acquisitions. I must add that additional financing was very successful. France, which represents about 57% of sales, grew organically by 2.8%, while international activities grew organically by 11.2%, confirming the continued market share gains across the regions. M&A further contributed 4.4% to the total growth of 10.4% in the first semester.

Speaker #3: At the end of May, P&G announced the closing of the transactions on majority stakes in two other parts distributors, Polaris and Rigueira, so there is one month’s contribution from these in this half-year number.

Speaker #3: Trading cash flows stood at €45 million, and leverage increased moderately following the additional financing raised to fund the acquisitions. I must add that this additional financing was very successful.

Speaker #3: France, which represents about 57% of sales grew organically by 2.8%, while international activities grew organically by 11.2%, confirming the continued market share gains across the regions.

Speaker #3: M&A further contributed 4.4% to the total growth of 10.4% in the first semester. It's worth noting that, in France, higher fuel prices started to weigh on miles driven, with an impact on market volumes.

Francis Deprez: It is worth noting that in France, higher fuel prices started to weigh on miles driven, with an impact on market volumes. Adjusted operating profit increased by 16.6% to EUR 155 million, with an adjusted operating margin of 9.6% compared to the 9.1% of a year ago, and that was supported by positive operating leverage, a strong focus on costs in a context where inflation continues to weigh on transport and personnel costs. The adjusted PBT group share reached EUR 107 million, up 18.4% year-on-year. The trading cash flows stood at EUR 45 million, down from EUR 66 a year ago, despite a stronger operating performance, mainly due to higher working capital requirements, including additional stock built and some reduced factoring, as well as higher expansion CapEx. Free cash flow reflects mostly the acquisition spend, of course, and the large AD distributors that I mentioned before.

Speaker #3: Adjusted operating profit increased by 16.6% to 155 million euros, with an adjusted operating margin of 9.6% compared to the 9.1 of a year ago, and that was supported by positive operating leverage, a strong focus on costs in the context when inflation continues to weigh on transport and personnel costs.

Speaker #3: The adjusted PBT group share reached €107 million, up 18.4% year-on-year. The trading cash flows stood at €45 million, down from €66 million a year ago, despite a stronger operating performance, mainly due to higher working capital requirements, including additional stock built, some reduced factoring, as well as higher expansion capex.

Speaker #3: Free cash flow reflects mostly the acquisition spend, of course, the large other distributors that I mentioned before. Leverage only slightly increased and remains at a reasonable level at 3.5 times. With that, I'll hand back to Édouard to talk about TVH.

Francis Deprez: Leverage only slightly increased, remains at a reasonable level at 3.5 times. With that, I will hand back to Edouard to talk about TVH.

Speaker #1: Indeed. After a few tougher years, TVH is progressively recovering its growth trajectory with a top-line growth of 7.7%, as we said in the first half, and a 3.7% growth in adjusted operating profit at constant effect.

Edouard Janssen: Indeed. After a few tougher years, TVH is progressively recovering its growth trajectory with a top-line growth of 7.7%, as we said in H1, and a 3.7% growth in adjusted operating profit at constant effect. The adjusted operating margin stood at 13.7%, and adjusted PBT group share increased by more than 19% year-on-year on a constant currency basis. Trading cash flows stood at EUR 42 million and free cash flow at -EUR 8 million. Leverage remained broadly stable at 3.2 times. Reported sales growth of 5.3% is composed of 6.6% organic growth, 0.9% from smaller bolt-on acquisitions, and a negative currency translation headwind of 2.2%. Organic growth was driven by improved volume trends across all equipment markets served by TVH and in nearly all regions, except, of course, the Middle East.

Speaker #1: The adjusted operating margin stood at 13.7%, and adjusted PBT group share increased by more than 19% year-on-year on a constant currency basis. Trading cash flows stood at 42 million euro, and free cash flow at minus 8 million euro.

Speaker #1: Leverage remained broadly stable at 3.2 times. Reported sales growth of 5.3% is composed of 6.6% organic growth, 0.9% from smaller Bolton acquisitions, and a negative currency translation headwind of 2.2%.

Speaker #1: Organic growth was driven by improved volume trends across all equipment markets served by TVH, and in nearly all regions, except, of course, the Middle East.

Speaker #1: Adjusted operating result increased by 3.7% at constant effects, with the benefits from sales growth and positive operating leverage being partly offset by cost inflation, notably in freight due to higher oil price, and by controlled growth in other operating expenses.

Edouard Janssen: Adjusted operating result increased by 3.7% at constant effects, with the benefit from sales growth and positive operating leverage being partly offset by cost inflation, notably in freight, due to higher oil price, and by controlled growth in other OpEx. Adjusted PBT group share increased by close to 17% to EUR 44 million, 19% at constant effects, driven by the operational performance and lower net finance costs. As a reminder, in H1 2025, net finance costs are being increased by realized and unrealized foreign exchange losses. Moving on to free cash flow, it was at -EUR 8 million, notably due to working capital investment, reflecting stronger sales with increased trade receivables and inventory investment to ensure product availability and allowing top-tier service levels that characterize TVH.

Speaker #1: Adjusted profit before tax group share increased by close to 17% to 44 million euro, 19% at constant effects, driven by the operational performance and lower net finance costs.

Speaker #1: As a reminder, H1 2025, in H1 2025, net finance costs have been increased by realized and unrealized foreign exchange losses. Now moving on to free cash flow, it was at minus 8 million euro, notably due to working capital investment, reflecting stronger sales with increased trades receivables and inventory investment to ensure product availability and allowing top-tier service levels that characterize TVH.

Speaker #1: Net financial debt stood at 901 million euro at the end of June 2026, compared with 853 million at the end of 2025, mainly reflecting free cash flow consumption and the interim dividend paid to shareholders.

Edouard Janssen: Net financial debt stood at EUR 901 million at the end of June 2026, compared with EUR 853 million at the end of 2025, mainly reflecting free cash flow consumption and the interim dividend paid to shareholders. Francis will now cover Moleskine.

Speaker #1: Francis, we've now covered money scheme.

Speaker #3: Well, thank you, Édouard. H1 is seasonally not the most important part of the year for Moleskine, yet it's worth noting that there has been strong additional organic growth in the first half of the year, that we have €0.7 million adjusted operating results, and an improving adjusted profit before tax group share thanks to lower financial charges following the shareholder loan waiver of €76 million.

Francis Deprez: Well, thank you, Edouard. H1 is seasonally not the most important part of the year for Moleskine. Yet, it is worth noting that there has been a strong additional organic growth in the first half of the year, that we have EUR 0.7 million adjusted operating results, and an improving adjusted PBT group shares, thanks to lower financial charges following the shareholder loan waiver of EUR 76 million. The trading cash flow and the free cash flow slightly improves year-over-year. The new management team is driving a comprehensive action plan to unlock Moleskine's full potential after several years of underperformance. That program includes both strategic and operating initiatives, spanning brand strengthening, enhanced go-to-markets, omni-channel execution, operational discipline and efficiency, greater organizational alignment, and a revitalized digital marketing strategy. As mentioned in the highlights, the reported sales grew organically by 6.2% year-on-year.

Speaker #3: The trading cash flow and the free cash flow slightly improved year over year. The new management team is driving a comprehensive action plan to unlock Moleskine's full potential after several years of underperformance.

Francis Deprez: The trading cash flow and the free cash flow slightly improves year-over-year. The new management team is driving a comprehensive action plan to unlock Moleskine's full potential after several years of underperformance. That program includes both strategic and operating initiatives, spanning brand strengthening, enhanced go-to-markets, omni-channel execution, operational discipline and efficiency, greater organizational alignment, and a revitalized digital marketing strategy. As mentioned in the highlights, the reported sales grew organically by 6.2% year-on-year.

Speaker #3: And that program includes both strategic and operating initiatives, spanning brand strengthening, enhanced go-to-market, omnichannel execution, operational discipline and efficiency, greater organizational alignment, and a revitalized digital marketing strategy.

Speaker #3: As mentioned in the highlights, the reported sales grew organically by 6.2% year-on-year—a good performance, especially in the retail channel—and a recovery in wholesale, mainly in the US. This mix led to a slight margin dilution at the adjusted operating result level, and the adjusted profit before tax group share now stands at minus €4.7 million versus minus €7.6 million a year ago, primarily due to the lower financial charges, as mentioned before.

Francis Deprez: A good performance, especially in the retail channel, and a recovery in wholesale, mainly in the US. This mix led to a slight margin dilution at the adjusted operating result level, and the adjusted PBT group share stood now at -EUR 4.7 million versus -EUR 7.6 million a year ago, primarily due to the lower financial charges, as mentioned before. Net debt after the waiver stood at EUR 204 million. Let me quickly finish with the corporate and allocated segment. The adjusted operating results remain broadly stable at -EUR 1.4 million. The adjusted net finance cost improved significantly to -EUR 7.2 million as the group prepaid its June 2025, EUR 500 million bridge loan that was raised at the end of 2024. As a result, adjusted PBT group share improved from -EUR 16.7 million in H1 2025 to -EUR 8.5 million in H1 2026.

Speaker #3: Net debt after the waiver stood at €204 million. Let me quickly finish with the Corporate and Allocated segment. The adjusted operating result remained broadly stable, at minus €1.4 million. The adjusted net finance costs improved significantly to minus €7.2 million, as the group prepaid its June 2025 €500 million bridge loan that was raised at the end of '24.

Francis Deprez: The adjusted operating results remain broadly stable at -EUR 1.4 million. The adjusted net finance cost improved significantly to -EUR 7.2 million as the group prepaid its June 2025, EUR 500 million bridge loan that was raised at the end of 2024. As a result, adjusted PBT group share improved from -EUR 16.7 million in H1 2025 to -EUR 8.5 million in H1 2026.

Speaker #3: And as a result, adjusted profit before tax group share improved from minus 16.7 in H1 2025 to minus 8.5 in H1 2026. The corporate and allocated net financial debt position stood at 300 million at the end of June, or 487 million if you exclude the inter-segment loan.

Francis Deprez: The corporate unallocated net financial debt position stood at EUR 300 million at the end of June or EUR 487 million if you exclude the inter-segment loan. To conclude, H1 2026 was a robust first half for D'Ieteren Group. Strong performances at Belron, at PHE, and at TVH. The improvement at Moleskine and the lower financial charges overall more than offset the challenging conditions at D'Ieteren Automotive. We confirm our full year outlook. The trends observed at D'Ieteren Automotive weakened throughout H1 2026 and are not expected to improve much in H2 2026. Yet, the impact of this evolution is expected to be partially offset in the second half at the adjusted profit before tax group share level by the other businesses of the group.

Speaker #3: So, to conclude, the first semester 2026 was a robust first half for D'Eteren Group, strong performances at Belron, at PHE, and at TVH, the improvement at Moleskine, and the lower financial charges overall, more than offset the challenging conditions at D'Eteren Automotive.

Speaker #3: We confirm our full-year outlook: the trends observed at D'Ieteren Automotive weakened throughout the first half of '26 and are not expected to improve much in the H2 of 2026. Yet, the impact of this evolution is expected to be partially offset in the second half at the adjusted profit before tax group share level by the other businesses of the group.

Francis Deprez: We confirm our full year outlook. The trends observed at D'Ieteren Automotive weakened throughout H1 2026 and are not expected to improve much in H2 2026. Yet, the impact of this evolution is expected to be partially offset in the second half at the adjusted profit before tax group share level by the other businesses of the group.

Speaker #3: We remain focused on supporting each of our businesses in the execution of their strategic priorities and are now opening the floor to questions. Operator, can you please take over?

Francis Deprez: We remain focused on supporting each of our businesses in the execution of their strategic priorities and are now opening the floor to questions. Operator, can you please take over?

Speaker #2: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star, followed by the one on your touchstone phone.

Operator: Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press star followed by the 1 on your touch tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the 2. If you are using a speakerphone, please lift the handset before pressing any keys. One moment please for your first question. Your first question comes from Alexander Craeymeersch with Kepler Cheuvreux. Your line is now open.

Operator: Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press star followed by the one on your touch tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the two If you are using a speakerphone, please lift the handset before pressing any keys. One moment please for your first question. Your first question comes from Alexander Craeymeersch with Kepler Cheuvreux. Your line is now open.

Speaker #2: You will hear prompt that your hand has been raised. Should you wish to decline from the polling process, please press star, followed by the two.

Speaker #2: If you are using a speakerphone, please lift your hands before pressing any keys. One moment, please, for your first question. Your first question comes from Alexander Kremer with Kepler Chevreux.

Speaker #2: Your line is now open.

Speaker #4: Hey, good evening. Thank you for taking my questions. And first of all, thank you, Francis. It's not yet the finish line, but thank you for the years that I have seen the company grow.

Alexander Craeymeersch: Hey, good evening. Thank you for taking my questions. First of all, thank you, Francis. It is not yet the finish line, but thank you for the years that I have seen the company grow. Second is, of course, also good to see that you are leading on Belron. That is over-delivering once again. First of all, I wanted to get that off my plate. Now the questions. The first question that I would have is on Belron, of course. We see nice growth in USA. But of course, a part of that is related to sort of normalization of this claim avoidance. The question I have is, how long is the runway of the recovery of this claim avoidance normalization? Second question would be on auto. Automotive clearly was sort of squeezed on margin plus received a sort of market share loss.

Speaker #4: Second is, of course, also, it's good to see that you are delivering on Belron. That is overdelivering once again. So, yeah, first of all, I wanted to get that off my plate.

Speaker #4: Now, the questions. The first question that I would have is on Belron, of course. We see nice growth in the USA, but of course, a part of that is related to a sort of normalization of this claim avoidance.

Speaker #4: The question I have is how long is the runway of the recovery of this claim avoidance normalization? Yeah, second question would be on auto.

Speaker #4: Automotive clearly was sort of squeezed on margin plus received a sort of market share loss. Question I would have there is that the 2.1% EBIT margin that we have seen whether you expect this to be a trough margin?

Alexander Craeymeersch: Question I would have there is that the 2.1% EBIT margin that we have seen, whether you expect this to be a trough margin. Second question on auto would be whether that market share loss, which was of course somewhat related to models ramping up in the H2. Do you expect to recover some of that market share loss in the second half? Because it is quite far away from the 25% that was originally marked as the target two CMDs ago. Then the last question I would have would be on TVH. TVH volume growth is not translating into relative margin expansions yet. Margins were better than what we expected, but given the market dynamics going forward, do you expect a change in this margin development, whether the operating leverage from extra volumes would actually translate in margin increase? That is it from my side. Thank you.

Speaker #4: And the second question on Auto would be whether that market share loss, which was, of course, somewhat related to models ramping up in the second half, do you expect to recover some of that market share loss in H2?

Speaker #4: Because it is quite far away from the 25% that was originally marked as the target two CMDs ago. And then the last question I would have would be on TVH.

Speaker #4: TVH volume growth is not translating into relative margin expansions yet. I mean, margins were better than what we expected, but given the market dynamics going forward, do you expect a change in this margin development—whether the operating leverage from extra volumes would actually translate into a margin increase?

Speaker #4: That's it from my side. Thank you.

Speaker #1: Okay, well, thank you, Alexander, for those questions. Yeah, the first— and thank you also for your kind comments. On Belron, on the US, the running, the claims avoidance— well, claims avoidance, as we said, had stopped declining a while back already, and started to— not declining avoidance, but the claims started declining, and the claims started to go up again since quite a couple of months now, again.

Francis Deprez: Okay. Well, thank you, Alexander, for those questions. Thank you also for your kind comments. On Belron, on the US, the claims avoidance, as you said, have stopped declining a while back already again, and started to. Not declining. The claims started declining, and the claims started to go up again since quite a couple of months now again. So are we now completely back to fully normal? I would not say that yet, but what we see is that we see continued good development that people are having claims and are using their claims overall in the US. So in that sense, it is a very healthy development that we are seeing. But to put a timing on when that would be running out, that is really pure speculation from my point of view. On D'Ieteren Automotive, you talked about the market share loss. That is true.

Speaker #1: And so are we now completely back to fully normal? I would not say that yet, but what we see is that we see continued good development that people are having claims and are using their claims overall in the US.

Speaker #1: So in that sense, it's a very healthy development that we're seeing. But to kind of put the timing on when that would be running out, that's really pure speculation from my point of view.

Speaker #1: On automotive, yeah, you talked about the market share loss. That's true. Actually, we have not been held by the fact that we had less models being launched in the first half of this year.

Francis Deprez: Actually, we have not been helped by the fact that we had less models being launched in the H1 of this year, in 2026. We had a couple of models that were working very well last year, new ones. We do actually anticipate there is a couple of new models coming in the second half year. They have already been launched, by the way. The ID. Polo, the Cupra Raval, the Škoda Epiq. Nice, smaller electric vehicles. But once they are there, and of course, there is always a little bit uncertainty when you launch a new model. When exactly do you not only get the order, but you get the cars delivered and therefore can invoice them. So, what exactly will happen in H2, what exactly will be more for 2027 is always a little bit difficult to predict.

Speaker #1: In 2026, we had a couple of models that were working very well last year—new ones. And we do actually anticipate there are a couple of new models coming in during the second half of the year that have already been launched, by the way.

Speaker #1: The ID. Polo, the Cupra Raval, the Skoda Epic—nice, more smaller electric vehicles. But once they’re there, and of course, there’s always a little bit of uncertainty when you launch a new model: when exactly do you not only get the order, but do you get the cars delivered and therefore can invoice them.

Speaker #1: So what exactly will happen in H2? What exactly will be more for 2027 is always a little bit difficult to predict. But so in terms of market share, we do think that with the new models coming up, we have a good mix of brands and models available to work on our market share.

Francis Deprez: But in terms of market share, we do think that with the new models coming up, we have a good mix of brands and models available to work on our market share, and make it move higher again than at 30 of today. So we will see where exactly that will land going forward in the months to come. In terms of the margin as the trough. Well, as you have seen, we have announced the intentions of the management of D'Ieteren Automotive to prepare the future. Part of that is, of course, also addressing part of the cost base. So that depends a little bit on how that process will be going, and there is nothing to comment on that to say that.

Speaker #1: And make it move higher again than a territory of today. So we'll see where exactly that will land going forward in the months to come.

Speaker #1: In terms of the margin, is it the throw? Well, it's as you've seen, we've of the management of D'Eteren Automotive to prepare the future.

Speaker #1: Part of that is, of course, also addressing part of the cost base. And so that depends a little bit on how that process will be going.

Speaker #1: And it's nothing to comment on that.

Speaker #4: But for each, it's too early, and for H2, unfortunately, as we said, we expect a continued very tough situation, as in H1, right, for auto.

Edouard Janssen: It is too early and for H2, unfortunately, as we said, we expect continued very tough situation. Yeah, as in H1, right, for auto.

Speaker #1: Yeah. And then on TVH, sorry.

Francis Deprez: Yeah, and then on TVH.

Edouard Janssen: Moving on to TVH.

Francis Deprez: Sorry, go ahead.

Speaker #4: Yeah, thank you, Francis. Indeed, even though the performance is better at TVH, and we are happy to see growth coming back, the message as we observe it on the margin development is very much in line with what we had said at the beginning of the year.

Edouard Janssen: Thank you, Francis. Indeed, even though the performance is better at TVH, we are happy to see growth coming back. The message, as we observe it on the margin development, is very much in line with what we had said at the beginning of the year, if you remember. We were expecting, unfortunately, some margin dilution due to various factors, including freight costs, with fuel price related, and also some non-cash cost of goods sold increases, such as inventory write-downs, combined with some control on OpEx. That said, as well, what is important to remember is that while the volumes recover at TVH, pricing trends are not yet recovering besides in the US, where the tariff passed through, which, by the way, has had a diluted gross margin effect.

Speaker #4: If you remember, we were expecting, unfortunately, some margin dilution due to various factors, including freight costs—right—related to fuel prices, and also some non-cash cost of goods sold increases, such as inventory write-downs, combined with some control on OPEX.

Speaker #4: That said, as well, what is important to remember is that while the volumes recover at TVH, pricing trends are not yet recovering—besides in the US, with the tariffs passed through.

Speaker #4: Which, by the way, has had a dilutive gross margin effect. So there is also a bit of differentiation from country to country on the pricing and, hence, margin size. As we said, it's a more favorable situation in the US versus less so in Europe.

Edouard Janssen: But there is as well a bit of a differentiation country to country on the pricing and hence margin size, as we said. A more favorable situation in the US versus less in Europe.

Speaker #4: Okay, very clear. If I may squeeze in one more—and I know you can't say much about this potential listing, et cetera—but I was just wondering, you know, it was already published in the financial papers in January that the minority shareholders are looking for strategic options.

Alexander Craeymeersch: Okay. Very clear. If I maybe squeeze in one more, and I know you cannot say much about this potential listing, et cetera. I am just wondering, it was already published in the financial papers in January that the minority shareholders are looking for strategic options. There was no announcement in Q1 press release, which would have been sort of an easy thing to do. Today, the interest rates are higher now than in January. I am just wondering, as an outsider, what changed between, let us say, April and today, that this is now becoming a higher focus. Thanks.

Speaker #4: There was no announcement in the Q1 press release, which would have been sort of an easy thing to do. Today, the interest rates are higher than they were in January.

Speaker #4: So, I'm just wondering, as an outsider, what changed between, let's say, April and today that this has now become a higher focus? Thanks.

Speaker #1: Well, as you know, each time I got that question in the past, I basically said that the moment has not come, because at some point in the future, we may get a knock on our door to start talking about potential strategic options.

Francis Deprez: Well, as you know, each time I got that question in the past, I basically said that the moment has not come, because at some point in the future, we may get a knock on our door to start talking about potential strategic options. That is the difference is that now we are exploring the strategic options.

Speaker #1: Well, that's the difference, is that now we are exploring the strategic options.

Speaker #4: Okay, I will leave it at that. Thank you very much. And again, thank you, Francis, and the rest, of course. Thank you.

Alexander Craeymeersch: Okay. I will leave it at that. Thank you very much. Again, thank you, Francis, and the rest, of course. Thank you.

Speaker #2: Your next question comes from David Wagman with ING. Your line is now open.

Operator: Your next question comes from David Vagman with ING. Your line is now open.

David Vagman: Yes, sir. Good evening, everyone, and thanks for taking my question. First, thanks, Francis, of course. I refrain from asking a question on the change of CEO. I just have four quick questions. First on Belron, could you disclose the volume growth excluding recalibration? Basically, the previous communication. My question is basically how is the general volume of cars on which Belron is working evolving or did evolve in H1? Then second question on Belron. It is a bit related to the question of Alexander. What has Belron seen in the US on insurance claims? If you could quantify the insurance claims recovery. I understood from some auto services companies in the US that it was bottoming or let's say troughing, but not really yet recovering. What are you seeing basically in H2?

Speaker #3: It's a good evening, everyone, and thanks for taking my question and first, thanks, Francis, of course. A very fine from asking a question on the change.

Speaker #3: Obviously, you. I just have four quick questions. So first, on Belron, could you disclose the volume growth excluding recalibration—so basically, the previous communication?

Speaker #3: So my question is basically, how is the general volume of cars on which Belron is working evolving, or how did it evolve in H1? Then, second question on Belron, it's a bit related to the question of Alexander.

David Vagman: It is a bit related to the question of Alexander. What has Belron seen in the US on insurance claims? If you could quantify the insurance claims recovery. I understood from some auto services companies in the US that it was bottoming or let's say troughing, but not really yet recovering. What are you seeing basically in H2?

Speaker #3: So, what has Belron seen in the US on insurance claims? If you could quantify the insurance claims recovery, I understood from some auto services companies in the US that it was bottoming—or let's say troughing—but not really yet recovering.

Speaker #3: And what are you seeing basically in H2? Quickly related to Belron again, like how do you see the what was basically the progress you had on mobile recalibration and the progress in the cash market in H1?

David Vagman: Quickly related to Belron again, what was basically the progress you had on mobile recalibration and the progress in the cash market in H1? Then last question on D'Ieteren Automotive. On D'Ieteren Automotive, you have this restructuring just announced. Is it enough to put you back on track to achieve the 4% EBIT margin that was the target for 2028? Or is the Belgian auto market evolution really calling for a material downward revision of these objectives? Thank you.

Speaker #3: The last question on auto, on auto, so you have this restructuring just announced. Is it enough to put you back on track to achieve the 4% EBIT margin that was the target for 2028?

Speaker #3: Or is the badge and auto market, you know, evolution really calling for a material downward revision of this objective? Thank you.

Speaker #1: Okay. Thank you, David. On Belron, the volume growth, if you exclude the recalibration, is actually plus 0.4%. The insurance claims recovery we have actually seen uplifts in claims percentages is something we try and track on a monthly basis, so to say, to see what it is.

Francis Deprez: Okay. Thank you, David. On Belron, the volume growth, if you exclude the recalibration, is actually +0.4%. The insurance claims recovery, we have actually seen uplifts in claims percentages. This is something we try and track on a monthly basis, so to say, to see what it is. Always takes a while before you get the last month, et cetera. But we have seen, if I just look at H1 of this year, really encouraging positive percentage increases on the insurance claims that were happening. But I can't quote specific numbers to this day, but they have been clearly there. On the MSR and the cash progress. MSR, of course, in the US, was the first country that was launched. In the meantime, it has been launched in a couple of other countries.

Speaker #1: It always takes a while before you get the last month, et cetera. But we have seen, if I just look at H1 of this year, really encouraging, positive percentage increases in the insurance claims that were happening.

Speaker #1: But I can't go specific numbers today, but there have been clearly there. Then on the MSR and the cash progress, yeah, MSR is, of course, in the US was the first country that was launched.

Speaker #1: In the meantime, it has been launched at a couple of other countries. You may, if you were in France by any chance, the summer may have seen the advertisements on the MSR that we now also have in France.

Francis Deprez: If you were in France by any chance this summer, you may have seen the advertisements on the MSR that we now also have in France, and we have it in more and more countries now. The consumer and insurance feedback we get is actually very positive. So both the insurers like it very much as an additional service feature that we can go to the end customers, rather than having them come to us. And also the consumers enjoyed us very much. It actually helps on no-shows and things like that and so on to avoid that. So it's a very good way to be a better service company, which is the ultimate objective of Belron as it has been for many, many years. We're really pleased with the way MSR is being accepted by the market, both consumers and insurers, and it's progressing quite nicely.

Speaker #1: And we have it in more and more countries now. The consumer and insurance feedback, again, is actually very positive, yeah? So both the insurers like it very much as an additional service feature that we can go to the end customers rather than having them come to us.

Speaker #1: And also, the consumers enjoy that very much. It helps with no-shows and things like that, so it helps to avoid those. So, it's a very good way to be a better service company, which is the ultimate objective of Belron, as it has been for many, many years.

Francis Deprez: It actually helps on no-shows and things like that and so on to avoid that. So it's a very good way to be a better service company, which is the ultimate objective of Belron as it has been for many, many years. We're really pleased with the way MSR is being accepted by the market, both consumers and insurers, and it's progressing quite nicely.

Speaker #1: And so we're really pleased with the way MSR is being accepted by the market—both consumers and insurers—and it's progressing quite nicely. The cash, as you said, we've mentioned that Belron is growing thanks to its strategic initiatives, and cash is one of them.

Francis Deprez: The cash, as you said, we mentioned that Belron is growing thanks to its strategic initiatives, and cash is one of them. So cash is also continuing on its trajectory. On auto, honestly, as you know, the intention was declared by the management at an automotive. The process has been launched with the social partners, and it's really impossible to say anything meaningful about where that will lead to at this point in time. So we really have to first go through the process and work together with the other partners on the way forward.

Speaker #1: And so cash is also continuing on its trajectory. On auto, honestly, as you know, the intention was declared by the management in automotive. The process has been launched with a social partners.

Speaker #1: And it's really impossible to say anything meaningful about where we are or where that will lead to at this point in time. So we really have to first go through the process and work together with the other partners on the way forward.

Speaker #3: Okay. Maybe thanks, Francis. Maybe a very quick follow-up on that one. Is it, you know, like compared to the time at the CMD, so basically May 2025, has the evolution been, you know, like very significantly worse than you had feared?

Edouard Janssen: Okay. Thanks, Francis. Maybe a very quick follow-up on that one. Compared to the time at the CMD, so basically May 2025, has the evolution been very significantly worse than you had feared? Any particular evolution in specifically?

Speaker #3: Any particular evolution in, you know, specifically?

Speaker #1: Well, I think what has probably been different in the— I mean, we mentioned this in our tech center—there's what's going on with the consumer sentiment.

Francis Deprez: Well, I think what has probably been different, we mentioned it in our tech centers. There is what is going on with the consumer sentiment. There is what is going on with the regulation, et cetera. Take the example of the mobility budget as one example.

Speaker #1: There's what's going on with the regulation, et cetera. Take the example of the mobility budget as one example. This is something that was still very small and is being pushed more and more within Belgium, the mobility budget.

Edouard Janssen: Yeah.

Francis Deprez: This is something that was still very small, and it is being pushed more and more within Belgium. The mobility budget is a change in consumer behavior that does have an impact on that. What I think is also there, but that was somehow to be expected, that of course, the arrival of the Chinese brands is now more and more visible. I have always said that at some point in time, they will kick up in their market shares. Now we start seeing that in Belgium as well. The B2B market that we are maybe made it a little bit later than other markets, but this is starting to happen. Step by step, this increased competition forces us to prepare well for the future, so that we can defend our market leadership position that we have here in Belgium.

Speaker #1: Is it changing consumer behavior? That does have an impact on that. What I think has also there, but that was somehow to be expected that, of course, the arrival of the Chinese brands is now more and more visible.

Speaker #1: And I've always said that at some point in time, they will pick up in their market shares. And now we start seeing that in Belgium as well.

Francis Deprez: Now we start seeing that in Belgium as well. The B2B market that we are maybe made it a little bit later than other markets, but this is starting to happen. Step by step, this increased competition forces us to prepare well for the future, so that we can defend our market leadership position that we have here in Belgium.

Speaker #1: The B2B market that we are maybe made it a little bit later than other markets, but this is starting to happen. And so step by step, this increased competition forces us to prepare well for the future.

Speaker #1: So that we can defend our market leadership position that we have here in Belgium.

Speaker #3: Thanks, Francis.

Edouard Janssen: Thanks, Francis.

Speaker #2: Your next question comes from Michael Declercq with KBCS. Your line is now open.

Operator: Your next question comes from Michiel Declercq with KBC Securities. Your line is now open.

Speaker #4: Yes. Hi, I'm Hugh Declercq from KBC Securities. Thanks for taking my question, and also thank you, Francis, for the last couple of years. You leave a completely different company—in a positive way, I would say.

Michiel Declercq: Yes. Hi, Michiel Declercq from KBC Securities. Thanks for taking my question, and also thank you, Francis, for the last couple of years. You leave a completely different company in a positive way, I would say. I had some further questions. The first one would be a bit on the group outlook. You guide for low to mid-single digits, adjusted PBT growth. You are now at 8% plus at constant currency. I understand that the impact from D'Ieteren Automotive will continue in the H2, but that would basically imply almost 0% growth at the group level in the H2. I am just trying to understand the moving parts here. Is that maybe a further deterioration at D'Ieteren Automotive, or is that more the higher comparable base at Belron? Any color on that would be useful.

Speaker #4: I had some further questions. The first one would be a bit on the group outlook. So you guide for low to mid-single digit adjusted PBT growth.

Speaker #4: You're now at 8% plus at constant currency. I understand that the impact from Auto will continue in the second half, but that would basically imply almost 0% growth at the group level.

Speaker #4: In the second half, I'm just trying to understand the moving parts here. Is that maybe further deterioration at Auto, or is that more the higher comparable base at Belron?

Speaker #4: So any color on that would be useful. Then the second would also be on Belron. And sorry to come back on those, on the claims situation.

Michiel Declercq: Then the second would also be on Belron, and sorry to come back on the claims situation. If I look a bit at the motor vehicle insurance inflation in the US, we have actually seen that it is coming down in the H1 and continues to do so. Can you maybe tell us in terms of the claims filings, how much we are still below, let us say, the pre-inflationary period? That would be useful. And then also, I understand that you now guide for the volumes both in terms of core and ADAS, but I still model it as the core VGRR volumes. If we look at the H1, we have seen a very strong price mix effects, one of the strongest one in the recent years.

Speaker #4: If I look a bit at the, yeah, the insurance, the motor vehicle insurance inflation in the US, we've actually seen that it's coming down in the first half and continues to do so.

Speaker #4: Can you maybe tell us, in terms of the claims filings, how much we are still below, let's say, the pre-inflationary period? That would be useful.

Speaker #4: And then also, I understand that you now guide for the volumes, both in terms of core and ADAS, but I still model it as the core VGRR volumes.

Speaker #4: And if we look at the first half, we have seen a very strong price mix effect, one of the strongest ones in the recent years.

Speaker #4: I'm just trying to understand where there's some price yeah, some phasing of the price increase is still in there, or how, let's say, the almost 7%, how should we see this going forward?

Michiel Declercq: I am just trying to understand where there is some phasing of the price increases still in there, or how, let us say, the almost 7%, how should we see this going forward? Should that come down a bit? Or any explanation why this was particularly strong this quarter or this half year? Thank you.

Speaker #4: Should that come down a bit? Or is there any explanation as to why this was particularly strong this quarter or this half-year? Thank you.

Speaker #1: Okay. Eduard, you want to take the question on the PBT?

Francis Deprez: Okay. Edouard, do you want to take the question on the PBT?

Speaker #5: Yeah, sure. On the PBT, what we can say is that as we explained, right, as the year develops, there are always some pluses and minuses, right?

Edouard Janssen: Yeah, sure. On the PBT, what we can say is that, as we explained, as the year develops, there are always some pluses and minuses, right? As communicated clearly, I think the trends at D'Ieteren Auto have indeed weakened throughout the H1 of the year and are not expected, unfortunately, to improve in the H2 of the year. Hence, this will lead to a weaker, negative impact, let's say. That should be partially offset in H2 at the level of the adjusted PBT group share by the group's other businesses. Partially offset. That is very important, right? Clearly, we do not provide guidance on a half-year, on-year basis, but we give a growth rate range for our KPI on a full-year basis, and we have no reason to change that.

Speaker #5: And as communicated clearly, I think the trends at different auto have indeed weakened throughout the first half of the year. And not expected, unfortunately, to improve in the second half of the year.

Speaker #5: And hence, this will lead to a weaker negative impact, let's say, that should be partially offset in H2 at the level of the adjusted PBT group share by the group's other businesses.

Edouard Janssen: That should be partially offset in H2 at the level of the adjusted PBT group share by the group's other businesses. Partially offset. That is very important, right? Clearly, we do not provide guidance on a half-year, on-year basis, but we give a growth rate range for our KPI on a full-year basis, and we have no reason to change that.

Speaker #5: Partially offset. That's very important, right? Clearly, we do not provide guidance on a half-year-on-year basis. But we gave a growth rate range for a KPI on a full-year basis.

Speaker #5: And we have no reason to change that, also on the back of the strong performance delivered in H1, and despite these weaker trends at Auto, as you described.

Edouard Janssen: On the back also of the strong performance delivered in H1, and despite these weaker trends at Auto, as you described, which should be, again, partially offset in H2 by our other businesses. Despite, let's remember that there is a tougher comparable base for Belron, of course, in H2 versus H1.

Speaker #5: Which should be, again, partially offset in H2 by our other businesses and despite, let's remember, that there is a tougher comparable base for Belron, of course, in H2 versus H1.

Speaker #5: For the group as a whole.

Francis Deprez: For the group as a whole. Okay. On the Belron claims, I honestly do not have the answer to the pre-inflationary period, and now are we entirely back. It is not something I have here at hand, unfortunately. On the price mix, yes, it has indeed been quite nice at 7%. In the US, the pricing was notably supported by an increase in NAGS. Probably partially incorporating tariffs, I would assume. It is always a bit of a black box with NAGS. That may have increased more than usual in September 2025. The price mix was also supportive in the other regions across the boards. That is mainly windscreen complexity, I would say, and the car park and the type of cars that require service from us. So that is more or less what has been behind this, the 7%. We will see where the rest of the year will land.

Speaker #1: Okay. Then on the Belron claims, I honestly don't have the answer to the pre-inflationary period and how or if we are entirely back. It's not something I have here at hand, unfortunately.

Speaker #1: On the price mix, yes, it has indeed been quite nice at 7%. In the US, the pricing was notably supported by an increase in NAGs.

Speaker #1: Probably porcelain incorporating tariffs, I would assume. It's always a bit of a black box with NAGs. That may have increased more than usual in September 2025.

Speaker #1: And then the price/mix was also supportive in the other regions, across the board. And that's mainly linked to screen complexity, I would say, and the car park and the type of cars that required service for us.

Speaker #1: Now, so that's more or less what has been behind this 7%. We'll see where the rest of the year will land.

Speaker #4: Thank you. If I can maybe ask a quick follow-up. So you mentioned the NAGs price increases were in September of last year. Is there anything still expected for this year in terms of further price adjustments, or?

Michiel Declercq: Thank you. If I can maybe ask a quick follow-up. You mentioned the next price increases were in September of last year. Is there anything still expected for this year in terms of further price adjustments or?

Speaker #1: That's always not only a black box in how they calculate the percentages, it's also a black box in when they will change. So we will have to discover that together.

Francis Deprez: That is always not only a black box on how they calculate the percentages, also a black box in when they will change. We will have to discover that together.

Speaker #4: All right. Thank you.

Michiel Declercq: All right. Thank you.

Speaker #2: Your next question comes from Tim Rascal with Bank of America. Your line is now open.

Operator: Your next question comes from Tim Raskol with Bank of America. Your line is now open.

Speaker #6: Thank you. Good evening, gents. Three questions for me, please. So just on the automotive side, perhaps you can help us understand, excuse me, the scale of the actions you're taking.

Tim Raskol: Thank you. Good evening, gents. Three questions from me, please. Just on the automotive side, perhaps you can help us understand, excuse me, the scale of the actions you are taking. The 300 plus headcount reduction, what would that translate to in terms of a cost save? That would be extremely helpful. Then also within D'Ieteren Automotive, is it time for you to consider other strategic options, whether that is partnering with other OEMs or a more meaningful mix change to your own distribution versus third-party retail capabilities? I know you referenced a little bit more operational leverage in your own business in the statement. Then as regards Belron, just interested in your thoughts on margin potential. If you sustain your margin delivery that you have achieved in the H1, you are going to be fairly close to your 25% margin target well ahead of time.

Speaker #6: So, the 300-plus headcount reduction—what would that translate to in terms of a cost save? That would be extremely helpful. And then also, within Automotive, is it time for you to consider other strategic options, whether that's partnering with other OEMs, or a more meaningful mix change to your own distribution versus third-party retail capabilities?

Speaker #6: I know you referenced a little bit more operational leverage in your own business in the statement. And then, as regards Belron, I'm just interested in your thoughts on margin potential.

Tim Raskol: I know you referenced a little bit more operational leverage in your own business in the statement. Then as regards Belron, just interested in your thoughts on margin potential. If you sustain your margin delivery that you have achieved in the H1, you are going to be fairly close to your 25% margin target well ahead of time.

Speaker #6: If you sustain the margin delivery that you've achieved in the first half, you're going to be fairly close to your 25% margin target, well ahead of time.

Speaker #6: So again, just interested in your thoughts on where margins could go beyond that. And then, the final question is just perhaps some quick thoughts on the shape of the pipeline with regards to M&A opportunities for both PHE and TVH, please.

Tim Raskol: So again, just interested in your thoughts on where margins could go beyond that. The final question is just perhaps some quick thoughts on the shape of the pipeline as regards M&A opportunities for both PHE and TVH, please. Thank you.

Speaker #6: Thank you.

Speaker #1: Okay.

Francis Deprez: Okay.

Speaker #5: Yeah. On the question of the scale, D'Ieteren Auto, of course, as we said, it's too early to tell. It's a work in progress and interactions are ongoing with the unions.

Edouard Janssen: Yeah. On your question on the scale at D'Ieteren Automotive, of course, as we said, it is too early to tell. It is work in progress, interactions ongoing with the unions. However, if you look at the 344 jobs that were announced, compared to the total workforce, we would be in a 10% to 15% range. It is indeed a strict legal process, right? So right now only an intention has been communicated. What we can say as well is that as part of this intention, they are also working more broadly on the cost base. It was also announced as part of the intention, possible site closures, possible reductions across the cost, right? But that reducing marketing costs, reducing content costs, et cetera. All of that, very important to say, strict legal process, early phase of the negotiation with the social bodies.

Speaker #5: However, if you look at the 344 jobs that were announced compared to the total workforce, we would be in a 10 to 15 percent range.

Speaker #5: It is indeed a strict legal process, right? So right now, only an intention has been communicated. But what we can say as well is that as part of this intention, there are also working more broadly on the cost base.

Edouard Janssen: What we can say as well is that as part of this intention, they are also working more broadly on the cost base. It was also announced as part of the intention, possible site closures, possible reductions across the cost, right? But that reducing marketing costs, reducing content costs, et cetera. All of that, very important to say, strict legal process, early phase of the negotiation with the social bodies.

Speaker #5: It was also announced as part of the intention, possible site closures, possible reductions across the cost base, right? But that's reducing marketing costs, reducing consulting costs.

Speaker #5: Et cetera, et cetera. But all of that, very important to say, strict legal process, early phase of the negotiation with the social bodies. So right now, it's only an intention.

Edouard Janssen: So right now it is only an intention and to be continued.

Speaker #5: And to be continued.

Speaker #1: Yes. On the other strategic options to explore with D'Ieteren Automotive, while there is a Strategic Plan 2030 that D'Ieteren Automotive has and that it follows.

Francis Deprez: Yes, on the other strategic options to explore with D'Ieteren Automotive, well, there is a strategic plan 2030 that D'Ieteren Automotive has and that follows, and that is the one that we are pursuing basically. So there is not much else to say on that for D'Ieteren Automotive. On the pipeline of M&A at PHE and TVH, yes, there is always a pipeline of ideas for sure. In the markets where PHE is active, there are always opportunities. As you know, we have added Ireland last year as a geography. We are now at seven, eight geographies, so there is always ideas to both look at geographies, but also within the geographies that we are in.

Speaker #1: And that's the one that we're pursuing, basically. And so there's not much else to say on that for D'Ieteren Automotive. On the yeah, on the pipeline of M&A at PHE and TVH, yes, there is always a pipeline of ideas, for sure.

Speaker #1: In the markets where PHE is active, there are always opportunities. As you know, we added Ireland last year as a geography. We're now in eight geographies.

Speaker #1: So there's always ideas to both look at geographies, but also within the geographies that we're in. And we've now done two acquisitions in Spain.

Francis Deprez: And we have now done two acquisitions in Spain, but that does not necessarily mean that it is the end of the road. We do not necessarily have a national footprint yet, even with those two acquisitions, although we made a big chunk. There are clearly many ideas on the table. Of course, it always takes two to tango to see whether they make any sense from both sides. On TVH, the same. TVH has recently even strengthened its M&A team. So we have a nice pipeline of potential. Some of them are more active than others, but we have a good view of where we would like to add if we are able to do so. So it is quite promising, I would say. On Belron, the same thing.

Speaker #1: But that doesn't necessarily mean that it's the end of the road. We don't necessarily have a national footprint yet, even with those two acquisitions, although we've made a big jump.

Speaker #1: And so there is clearly many ideas on the table. But of course, we always take two to tango to see whether they make any sense.

Speaker #1: From both sides. And on TVH, the same. TVH has a nice recently even strengthened its M&A team. So we have a nice pipeline of potential.

Speaker #1: Some of them are more active than others. But we have a good view of where we would like to add we're able to do so quite promising, I would say.

Speaker #1: And then on the Belron market, do you want to say something?

Edouard Janssen: Belron margin definitely solid delivery in H1. Let us be clear. Let us not forget a few important elements. First, last year, H2 is a much tougher comparable. So let us remain humble and as well with the M&A effect that Francis talked about in September last year-on-year. So that is one factor. The other factor is let us remember that we had guided to the 2028 target being spread over multiple years for many reasons. Hence, yes, that seems like a realistic direction.

Speaker #5: Margin definitely. Solid delivery in H1, right? Let's be clear. But let's not forget that a few important elements. First, last year, H2 is a much tougher comparable, right?

Speaker #5: So let's remain humble and as well with the NAGs effect that Francis talked about in September last year, right? Year on year. Yeah. So that's one factor.

Speaker #5: The other factor is, let's remember that we had guided to the 2028 target being spread over multiple years, right? For many reasons. And hence, yes, that seems like a realistic direction.

Speaker #6: Very helpful. Thank you.

Tim Raskol: Very helpful. Thank you.

Speaker #2: Your next question comes from James Roland with Barclays. Your line is now open.

Operator: Your next question comes from James Roland with Barclays. Your line is now open.

Speaker #7: Hi. Evening. Two questions, please. Just firstly on the guidance on the adjusted PBT group share and those single digits and mid-single digits, which you've kept unchanged.

James Roland: Hi. Evening. Two questions, please. Firstly on the guidance, on adjusted PBT group share, low single digit to mid single digit, which you have kept unchanged, with autos weakening, but partially offset by the other lines. Can we assume that you are essentially pointing to the bottom end of that low single digit to mid single digit range? Considering consensus sits at the top of that at the moment. Secondly, on capital allocation. If we project into the mid to longer term in a world where Belron may well be listed, could you update us on your plans regarding group M&A and how you think about the portfolio at the moment? Clearly, there is a consolidation strategy that is ongoing in your TVH and PHE subsidiaries. How do you think about the group structure and the holding five subsidiaries that you have at the moment? Thank you.

Speaker #7: With autos weakening, but partially offset by the other lines. Can we assume that you'll effectively pointing to the bottom end of that low single digits and mid-single digit range considering consensus sits at the top of that at the moment?

Speaker #7: Secondly, on capital allocation, if we sort of project into the mid- to longer-term, in a world where Belron may well be listed, could you update us on your plans regarding group M&A and how you think about the portfolio at the moment?

James Roland: Secondly, on capital allocation. If we project into the mid to longer term in a world where Belron may well be listed, could you update us on your plans regarding group M&A and how you think about the portfolio at the moment? Clearly, there is a consolidation strategy that is ongoing in your TVH and PHE subsidiaries. How do you think about the group structure and the holding five subsidiaries that you have at the moment? Thank you.

Speaker #7: Clearly, there's a consolidation strategy that's ongoing in your PBH and PHE subsidiaries. But how do you think about the group structure and the holding of five subsidiaries that you have at the moment?

Speaker #7: Thank you.

Speaker #5: So on the guidance, clearly, what so we don't want to provide anything so precise, right? What we can say, that you can read as well in our wording, is that there was a better expected H1 versus H2 for various reasons.

Edouard Janssen: So on the guidance, clearly, we do not want to provide anything so precise, right? What we can say, that you can read as well in our wording, is that there was a better aspect of the H1 versus H2 for various reasons, and definitely a weakened situation at different D'Ieteren Auto expected to be partially offset by the other one. So, yeah. Not much more to be said at this stage.

Speaker #5: And definitely, a weakened situation at D'Ieteren Auto expected to be partially offset by the other one. So yeah, so not much more to be said at this stage.

Speaker #1: Yeah, that's to confirm. Confirmation of the guidance, basically, of the range. And capital allocation, group M&A, yes, of course, we are very much supportive of PHE, TVH, and the other businesses when they have meaningful M&A to do.

Francis Deprez: Yeah. That is the confirmation of the guidance, basically, of the range. Capital allocation, group M&A. Yes, of course, we are very supportive of PHE, TVH, and the other businesses when they have meaningful M&A to do. By the way, Belron did 15 small acquisitions as of on H1. Not to forget about that. As a group, we continue, as we have done, to always have a deal flow, to look at potential files, to see where we can go, and then have our very disciplined and systematic four-phase approach to see how far we go and whether we ultimately submit non-binding offers or binding offers, et cetera, pp. So that actually continues, that strategy. So it remains our intention over time to do both. To do and help grow our existing businesses, and at some point in time, we may add another growth pillar.

Speaker #1: By the way, Belron did 15 small acquisitions as well in H1. Not to forget about that. And as a group, we continue as we have done.

Francis Deprez: As a group, we continue, as we have done, to always have a deal flow, to look at potential files, to see where we can go, and then have our very disciplined and systematic four-phase approach to see how far we go and whether we ultimately submit non-binding offers or binding offers, et cetera, pp. So that actually continues, that strategy. So it remains our intention over time to do both. To do and help grow our existing businesses, and at some point in time, we may add another growth pillar.

Speaker #1: To always have a deal flow, to look at potential files, to see where we can go, and then have our very disciplined and systematic four-phased approach to see how far we go.

Speaker #1: And whether we ultimately submit non-binding offers or binding offers, et cetera, et cetera. So that actually continues—that strategy. So it remains our intention over time to do both.

Speaker #1: To do and help grow our existing businesses. And at some point in time, we may add another growth pillar that has not changed that strategy.

Francis Deprez: That has not changed, that strategy. Yeah.

Speaker #2: Your next question comes from ThisBerkelder with Auto. Your line is now open.

Operator: Your next question comes from Thijs Berkelder with Oddo. Your line is now open.

Thijs Berkelder: Yeah, thank you for having me. First question is on your outlook for segment. You only adjust the D'Ieteren Automotive outlook and are keeping the outlook for the other sectors unchanged. Is that correct? Secondly, on outlook, should I read something in you not repeating explicitly your 2028 ambitions? Should I maybe read this in light of the coming change in the CEO position? How sure can we be on that these 2028 ambitions still stand? Next to these outlook questions, I have a couple of questions on Belron. Can you maybe update us on the staff base at Belron versus year-end and the attrition rates taking place in that staff base? Can you maybe indicate what the staff costs in percentage of turnover have been, as well as potentially the extra marketing costs taken in H1, maybe because of higher costs related to the World Cup football.

Speaker #6: Yeah, thank you for having me. First question is on your outlook for the segment. You only adjusted the automotive outlook and are keeping the outlook for the other sectors unchanged.

Speaker #6: Is that correct? And secondly, on outlook, should I read something and you not repeating explicitly your 28 ambitions? And should I maybe read this in light of the coming change in the CEO position?

Speaker #6: How sure can we be on that these 28 ambitions still stand? Next to these outlook questions, I have a couple of questions on Belron.

Speaker #6: Can you maybe update us on the staff base at Belron versus year-end, and the attrition rates taking place in that staff base? And can you maybe indicate what the staff costs as a percentage of turnover have been?

Speaker #6: As well as potentially the extra marketing costs taken in H1, maybe because of higher costs related to the World Cup football.

Speaker #1: All right.

Edouard Janssen: All right. Yeah. With regard to the outlook questions. Simply, practically, in the middle of the year, we do not provide a detailed entity per entity. In this case, given the significant, let us say, deviation at D'Ieteren Auto, we wanted to make that very clear. But apart from that, we do not provide a detail. About 2028, no. Nothing to be said there about 2028. No changes on that trajectory. Nothing to be read. No.

Speaker #5: All right. Yeah. With regard to the outlook questions, so simply practically in the middle of the year, we don't provide a detailed entity per entity.

Speaker #5: And in this case, given the significant let's say deviation at D'Ieteren Auto, we wanted to make that very clear. But apart from that, we don't provide a detail.

Speaker #5: About 2028—no news, nothing to be said there. About 2028, no changes, right, on that trajectory. Nothing to be read. No, no.

Speaker #1: We're almost halfway through, basically, since April 25 when we talked about them. And so we're very nicely on track vis-à-vis those ambitions. And so they're very much still there to continue to be our medium-term guidance.

Francis Deprez: We are almost halfway through, basically, since 25 April when we talked about them. We are very nicely on track vis-à-vis those ambitions. They are very much still there to continue to be our medium-term guidance. Yeah. On the Belron side, by the way, the attrition rates of staff have actually continued to improve in most of the countries, not necessarily in all countries, but in most of the countries. So it is quite a good thing. Staff costs are, of course, a significant portion, given that the service business at Belron. You can easily be between 15% to 20% of the kind of direct labor costs that you have within Belron. That is very feasible. Advertising cost is the other one, which of course, the advertising costs are quite significant, as you know. They are in the single digit percent of sales numbers.

Speaker #1: Yeah. On the Belron side, by the way, the attrition rates of staff have actually continued to improve in most of the countries—not necessarily in all countries, but in most of them.

Speaker #1: That's quite a good thing. Now, staff costs are, of course, significant portion given that the service business at Belron. You can easily be between 15 to 20 percent of a kind of direct labor costs that you have within Belron.

Francis Deprez: You can easily be between 15% to 20% of the kind of direct labor costs that you have within Belron. That is very feasible. Advertising cost is the other one, which of course, the advertising costs are quite significant, as you know. They are in the single digit percent of sales numbers.

Speaker #1: That's very feasible. And advertising costs is the other one, which, of course, advertising costs are quite significant, as you know. They can be in the they're re in the single digit percent of sales numbers.

Speaker #1: We typically tweak it depending on what we need to do to kind of get the demand and the do-nothing ratios to work in our favor.

Francis Deprez: We typically tweak it depending on what we need to do to get the demand and the do nothing ratios to work to our favor. We are more looking at it as a way to develop the top line than as something where you say, "Oh, can I save some costs here and there?" It is really more a top-line enabler than anything else. We have continued to spend on advertising in H1. Absolutely.

Speaker #1: And so we are more looking at it as a way to develop the top line than as something where you say, "Oh, can I save some costs here and there?" So it's really more a top-line enabler than anything else.

Speaker #1: And so we have continued to spend on advertising in H1. Absolutely.

Speaker #6: Okay. Thanks.

Thijs Berkelder: Okay, thanks.

Speaker #2: Your next question comes from Jeremy Kincaid with Van Lanschot Kempen. Your line is now open.

Operator: Your next question comes from Jeroen KBC with Van Lanschot Kempen. Your line is now open.

Speaker #7: Good me. The first on TVH, you had a strong improvement in organic growth there, broad-based. Could you just go into some of the detail as to why it was so strong?

Jeroen KBC: Good evening, gentlemen. Three questions from me. The first on TVH. You had a strong improvement in organic growth there, broad-based. Could you just go into some of the detail as to why it was so strong? I suppose I am just trying to get an idea of how permanent this might be. I note that in the H1 2024, you had a similar

Speaker #7: I suppose I'm just trying to get an idea of how permanent this might be. I note that in the first half of '24, you had a similar increase in organic sales growth.

[Analyst]: increase in organic sales growth. It went from 0% up to 6%, 6.5%, and then we had 18 months of zero again. Just trying to understand how permanent this could be. My second question is on Moleskine and the debt waiver. If I understand the mechanics correctly, there was an impairment, which under Italian law means you are now at a certain debt-to-equity threshold, which required the waiver. My question is, where do you sit on this threshold now? If there were more impairments, would it be likely to see more debt waivers? My final question is, we have seen some announcements from the OEM vehicle manufacturers, and they have said that aftermarket glass is potentially not approved for their warranties. I was just wondering what Belron's position on that is, and if you are in any discussions with the OEMs. Thanks.

Speaker #7: It went from 0% up to 6%, 6.5%, and then we had 18 months of 0 again. So yeah, just trying to understand how permanent this could be.

Speaker #7: My second question is on Moleskine and the debt waiver. If I understand the mechanics correctly, there was an impairment which, under Italian law, means you're now at a certain debt-to-equity threshold, which required the waiver.

Speaker #7: My question is, does that where do you sit on this threshold now? And if there were more impairments, would it be likely to see more debt waivers?

[Analyst]: My question is, where do you sit on this threshold now? If there were more impairments, would it be likely to see more debt waivers? My final question is, we have seen some announcements from the OEM vehicle manufacturers, and they have said that aftermarket glass is potentially not approved for their warranties. I was just wondering what Belron's position on that is, and if you are in any discussions with the OEMs. Thanks.

Speaker #7: And then my final question is, we've seen some announcements from the OEM vehicle manufacturers and they've said that aftermarket glass is potentially not approved for their warranties.

Speaker #7: I was just wondering what Belron's position on that is and if you're in any discussions with the OEMs. Thanks.

Speaker #1: Okay. Well, on TVH, why so strong on the volume growth? I mean, there are a couple of factors. As you know, the kind of non–material handling verticals, like construction or agriculture, have been growth strategic priorities for TVH.

Francis Deprez: Well, on TVH, why so strong on the volume growth? There is a couple of factors. As you know, the kind of non-material handling verticals like construction or agriculture, have been growth strategic priorities for TVH, and we are having good traction on both of those, actually. So we have seen very nice growth rates in the construction segment that we are, where we are, in many cases, not necessarily that very well-known yet. We have added our catalogs. We have made sure we have the right SKUs on stock in all the different areas around the world where we are offering that. So we have seen very, very nice. So that is there to stay because we have now these models and makes within the construction industry in our catalogs. We have now the warehouses and the SKUs there. So customers have just discovered us for those type of spare parts.

Speaker #1: And we're having good traction on both of those, actually. So we've seen very nice growth rates in the construction sectors where we are, where we're in many cases not necessarily that very well known yet.

Speaker #1: We've added our catalogs. We've made sure we had the right SKUs on stock in all the different areas around the world where we are offering that.

Francis Deprez: We have added our catalogs. We have made sure we have the right SKUs on stock in all the different areas around the world where we are offering that. So we have seen very, very nice. So that is there to stay because we have now these models and makes within the construction industry in our catalogs. We have now the warehouses and the SKUs there. So customers have just discovered us for those type of spare parts.

Speaker #1: And so we've seen very, very nice and so that's there to stay because we have now these models and makes within the construction industry in our catalogs.

Speaker #1: We have now the warehouses and the SKUs there. And so customers have just discovered us for those type of spare parts. And in agriculture as well, we've actually seen very good progress again in the agriculture.

Francis Deprez: In agricultural as well, we have actually seen very good progress again in the agriculture. That was a bit more tough in the last couple of years, but we have seen nice growth in the agricultural spare parts very much. I would say the second thing that has really given extra dynamism, which I also believe is structural in nature, is that there has been a lot more commercial drive again within the TVH teams across the regions. I can talk about the way they talk about the key account management, the way they look at every single opportunity, the way we try to align the digital campaigns towards our websites and e-commerce on TVH. So it is really a very commercially driven culture, and I think that there is a very strong momentum at the moment, and I see no reason why that should change.

Speaker #1: That was a bit more tough in the last couple of years. But we've seen nice growth in the agriculture spare parts, very much. And I would say the second thing that has really given extra dynamism, which I also believe is structural in nature, is that there's been a lot more commercial drive again within the TVH teams, across the regions.

Speaker #1: I can talk about the way they talk about key account management, the way they look at every single opportunity, the way we try to align the digital campaigns towards our websites and e-commerce, our TVH.

Francis Deprez: I can talk about the way they talk about the key account management, the way they look at every single opportunity, the way we try to align the digital campaigns towards our websites and e-commerce on TVH. So it is really a very commercially driven culture, and I think that there is a very strong momentum at the moment, and I see no reason why that should change.

Speaker #1: So it's really a very commercially driven culture, and I think there's a very strong momentum at the moment, so no reason why that should change.

Edouard Janssen: Moving on to Moleskine.

Francis Deprez: Yeah, the threshold.

Speaker #1: Yeah, the threshold.

Edouard Janssen: Yeah, the threshold. Basically, your understanding is correct. That according to Italian statutory rules, yes, it led to that waiver on the debt, and in the future, long story short, the answer would be yes as well.

Speaker #5: Yeah, the threshold. Basically, your understanding is correct, right, that according to Italian statutory rules, yes, it led to that waiver on the debt. And in the future—long story short—the answer would be yes.

Speaker #5: As well.

Speaker #1: And then on the non-approval for warranties of aftermarket glass from OEMs, again, we as Belron hardly touch warranty jobs, yeah, because the warranty job, you typically go to your OEM dealer, otherwise you don't get kind of the payment organized for them.

Francis Deprez: On the non-approval for warranties of aftermarket glass from OEMs. Again, we as Belron hardly touch warranty jobs. Because a warranty job, you typically go to your OEM dealer. Otherwise, you do not get the payments organized for them, and they have conditions linked to warranty to do exactly that. So we are typically not affected by what is going on in the warranty business at Belron because we are de facto a specialist player, not linked to an OEM.

Speaker #1: And they have, of course, the conditions linked to warranty to do exactly that. So we are typically not affected by what's going on in the warranty business.

Speaker #1: At Belron, because we are de facto a specialist player not linked to an OEM. Yeah.

Speaker #7: Great, thank you. And will this be the case in the future, Francis?

[Analyst]: Great. Thank you. We will leave this with you, Francis.

Speaker #2: Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Andy Grobler with ENP Teraba.

Operator: Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Andy Grobler with BNP Paribas. Your line is now open.

Speaker #2: Your line is now open.

Speaker #8: Hi, good evening. Three from me as well, if I may. Firstly, on Belron—I know this topic has come up around claims. With the insurance companies having put up their deductibles as prices go up, do you think that you'll go back to historic levels of claims, or have those levels come down permanently through that process?

Andy Grobler: Hi. Good evening. Three from me as well, if I may. Firstly, on Belron, I know this topic has come up around claims. Just with the insurance companies having put up their deductibles as prices go up, do you think that you will go back to historic levels of claims or have those levels come down permanently through that process? Secondly, on D'Ieteren Automotive, just if you could talk through the extent to which there is gross margin pressure from Volkswagen as they deal with their own issues. To what extent is that in place, and do you expect that to continue? Thirdly, just quickly on Belron, cash flow was helped by much lower tax in the semester. How sustainable is that lower tax rate? Thank you very much.

Speaker #8: Secondly, on automotive, just if you could talk through the extent to which there is gross margin pressure from Volkswagen as they deal with their own issues, to what extent is that in place?

Speaker #8: And do you expect that to continue? And then thirdly, just quickly on Belron, cash flow was helped by much lower tax in the semester.

Speaker #8: How sustainable is that lower tax rate? Thank you very much.

Speaker #1: Let me start with the auto question on the gross margin pressure from Volkswagen. Of course, they have a lot of pressure, and they're trying to pass that pressure further down the value chain.

Francis Deprez: I will maybe start with the auto question on the gross margin pressure from Volkswagen. Of course, they have a lot of pressure, and they are trying to pass that pressure further down the value chain. We know that. We know that each time they launch new models, that they may reduce the distribution margin that is available for the bottom part of the value chain. But that is not new. This is something we have known since many, many years. But this is not necessarily pressure from Volkswagen. Given that there is more intense competition, of course, from time to time, we do have to give a little bit more discounts or make efforts for customers to make the choice in our direction. That is, I would say, at least as much a contributor to something that is purely passed on from the Volkswagen Group to us.

Speaker #1: We know that, yeah. We know that each time they launch new models, that they may reduce the distribution margin that's available for the bottom part of the value chain.

Speaker #1: But that's not new, and this is something we have known since many, many years. And what we also and but that is not necessarily pressure from VW, given that there is more intense competition.

Francis Deprez: This is something we have known since many, many years. But this is not necessarily pressure from Volkswagen. Given that there is more intense competition, of course, from time to time, we do have to give a little bit more discounts or make efforts for customers to make the choice in our direction. That is, I would say, at least as much a contributor to something that is purely passed on from the Volkswagen Group to us.

Speaker #1: Of course, from time to time, we do have to give a little bit more discounts or make efforts for customers to make the choice in our direction.

Speaker #1: And so that's, I would say, at least as much a contributor to something that is just purely passed on from the Volkswagen group to us.

Francis Deprez: I do expect that as they are progressing with their own restructurings and so on, that they will more and more again be in a position where they can offer competitively priced vehicles where you would not necessarily need that much needs for discounting. But this is a kind of a cyclical. We have seen this going up and down over the years, and so we are now in a phase where, yes, there is less gross margin available for a number of reasons that I mentioned.

Speaker #1: I do expect that as they are progressing with their own restructurings and so on, that they will more and more again be in a position where they can offer competitively priced vehicles where you would not necessarily need that much needs for discounting.

Speaker #1: But this is the kind of a cyclical we've seen this going up and down over the years. And so we're now in a phase where yes, there is less gross margin available for a number of reasons that I mentioned.

Edouard Janssen: Mm-hmm. With regard to the claims levels at Belron, what we can say is that we do continue to see the underlying premium environment remaining favorable, and hence claims progressing. This is, let's say, in relative terms and not in absolute terms. I think this is your question. So that relative progression is continuing, although it's not every month necessarily that it is progressing. But it continues. Important to flag that last year, it's in H2 that we started seeing this significant progression in the market with the whole insurance market having done the turn, et cetera. Hence, that comparable will be tougher as well year on year. Now moving on to your Belron cash flow and tax question. Clearly, there was a favorable, let's say, one-off in H1 of this year that we don't expect to see being repeated.

Speaker #5: With regard to the claims, the levels at Belron, right? What we can say is that we do continue to see the underlying premium environment remaining favorable.

Speaker #5: And hence, claims to progressing. But let's say in relative terms and not in absolute terms, right? I think this is what your question. So that relative progression is continuing, although it's not every month necessarily that it is progressing, right?

Speaker #5: But it continues. Important to flag that last year, it's in H2 that we started seeing this significant progression in the market with the whole insurance market having done the turn, etc.

Edouard Janssen: But it continues. Important to flag that last year, it's in H2 that we started seeing this significant progression in the market with the whole insurance market having done the turn, et cetera. Hence, that comparable will be tougher as well year on year. Now moving on to your Belron cash flow and tax question. Clearly, there was a favorable, let's say, one-off in H1 of this year that we don't expect to see being repeated.

Speaker #5: And hence, that comparable will be tougher as well year on year. Now, moving on to your Belron cash flow and tax question, clearly there was a favorable, let's say, one-off in H1 of this year that we don't expect to see being repeated.

Speaker #8: Thank you very much.

Andy Grobler: Thank you very much.

Speaker #2: Your next question comes from Mexin Legend with the group Peter Cam. Your line is now open.

Operator: Your next question comes from Maxime Lemerle with Degroof Petercam. Your line is now open.

Speaker #9: Hi. Thanks for taking my question. I have two main questions. The first one, relates to the automotive part. You mentioned that you don't expect to see any recovery in H2.

Maxime Lemerle: Hi, thanks for taking my question. I have two main questions. The first one relates to the automotive part. You mentioned that you don't expect to see any recovery in H2. Do you have any timeline in mind of when we could see the first positive sign of the restructuration? The second one is related to PHE. The leverage rose to 3.5. Is there any ceiling for you, or do you still have room to do further bolt-on M&A? Thank you.

Speaker #9: Do you have any timeline in mind of when we could see the first positive sign of the restructuration? And the second one is related to PHE.

Speaker #9: The leverage rose to 3.5. Is there any ceiling for you? Or do you still have room to do further bolt-on M&A? Thank you.

Speaker #1: Okay. Well, on digital automotive, of course, we don't know the exact timing of how these negotiations, discussions, and consultation periods will go with the social partners.

Francis Deprez: Well, on D'Ieteren Automotive, of course, we do not know the exact timing of how these negotiations and discussions and consultation periods will go with the social partners. It is difficult to say when you would start seeing effects on balance, at least of the other side. What we do know on the more commercial side, I would say the top-line side, as I mentioned before, that we get the newer models coming. As those new models will come, I guess you will successively start seeing again that we can work on our market share and therefore, hopefully also on the number of volumes that we can invoice.

Speaker #1: And so it's difficult to say when you would start seeing effects on that end, at least of the side. What we do know on the more commercial side, I would say the top-line side, as I mentioned before, that we get the newer models coming, and as those new models will come, I guess we will successively start seeing again that we can work on our market share and therefore hopefully also on the number of volumes that we can invoice.

Speaker #1: Yeah.

Speaker #5: On PHE, actually, we are very pleased, right, that PHE could do this nice acquisitions in Spain, right? It's very much part of their whole story and value creation story.

Edouard Janssen: On PHE-

Francis Deprez: PHE.

Edouard Janssen: Actually, we are very pleased that PHE could do these nice acquisitions in Spain. It is very much part of their whole story and value creation story of the bolt-on M&A, the synergies it brings too. They have an excellent capability of execution there. Let us not forget that on a pro forma basis, it would of course be a bit lower. Hence, yes, they continue to be able to continue to do their bolt-on M&A strategy, and we expect that to continue going forward. Let us not forget that when we bought PHE, they were at 4.5x leverage, and they have deleveraged progressively over time. Now, we like the around 3x, but as we said, 3.5x or even a bit more for future M&A is absolutely fine and welcome.

Speaker #5: Of the bolt-on M&A, the synergies it brings too. They have an excellent capability of execution there. And so let's not forget that on a pro forma basis, it would, of course, be a bit lower.

Speaker #5: But hence, yes, they continue to be able to continue to do their bolt-on M&A strategy. And we expect that to continue going forward. Let's not forget that when we bought PHE, they were at 4.5 times leverage.

Edouard Janssen: Hence, yes, they continue to be able to continue to do their bolt-on M&A strategy, and we expect that to continue going forward. Let us not forget that when we bought PHE, they were at 4.5x leverage, and they have deleveraged progressively over time. Now, we like the around 3x, but as we said, 3.5x or even a bit more for future M&A is absolutely fine and welcome.

Speaker #5: And they have deleveraged progressively over time. Now we like the around three times. But as we said, 3.5 or even a bit more for future M&A is absolutely fine and welcome.

Speaker #9: Perfect. Thank you very much.

Maxime Lemerle: Perfect. Thank you very much.

Speaker #2: There are no further questions at this time. I will now turn the call over to management for closing remarks.

Operator: There are no further questions at this time. I will now turn the call over to management for closing remarks.

Speaker #1: Well, thank you very much for all your calls and your questions. And looking forward to meeting on another occasion. Have a great evening.

Francis Deprez: Well, thank you very much for all your calls and your questions, and looking forward to meeting on another occasion. It is going to be a great evening.

Speaker #2: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating in NASA. You may please disconnect your lines.

Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.

James Roland: Please wait. The conference will begin shortly.

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