Q2 2026 Stevanato Group SpA Earnings Call

August 4, 2026

Lisa Miles: Of today's presentation and in our press release. The company undertakes no obligation to revise or update these forward-looking statements, except as required by law. Today's presentation may include non-GAAP financial information. Management uses these measures internally to assess performance and believes they may be helpful for investors in evaluating the quality of our financial results, identifying trends in our performance, and providing meaningful period-to-period comparisons. For a reconciliation of these non-GAAP measures, please refer to the company's most recent earnings press release. With that, I'll hand the call over to Franco Stevanato.

Speaker #1: Of today's presentation and in our press release. The company undertakes no obligation to revise or update these forward-looking statements except as required by law.

Speaker #1: Today's presentation may include non-GAAP financial information. Management uses these measures internally to assess performance and believes they may be evaluating the quality of our financial results, identifying trends in our performance, and providing meaningful period-to-period comparisons.

Speaker #1: For a reconciliation of these non-GAAP measures, please refer to the company's most recent earnings press release. And with that, I'll hand the call over to Franco Stevanato.

Speaker #2: Thank you for joining us. Today we review our second quarter performance, share an update on market trends in our two segments—including our investment projects—and discuss the current environment.

Marco Dal Lago: Thank you for joining us. Today, we review our Q2 performance, share an update on market trends in our two segments, including our investment projects, and discuss the current environment. Our Q2 financial results were largely in line with our expectations, highlighted by solid revenue growth and a better mix of high-value solutions that drove expanded margins and adjusted EBITDA of 26%. Revenue grew 8% year-over-year, driven by a 9% revenue increase in the Biopharmaceutical and Diagnostic Solutions segment, which offset a slight decline in engineering segment. Revenue from high-value solutions grew 16% and represented 45% of the total company revenue in Q2 2026, driven by a 30% increase in revenue from biologics, the fastest-growing end market. Revenue related to GLPs was approximately 22% to 23% of total company revenue.

Franco Stevanato: Thank you for joining us. Today, we review our Q2 performance, share an update on market trends in our two segments, including our investment projects, and discuss the current environment. Our Q2 financial results were largely in line with our expectations, highlighted by solid revenue growth and a better mix of high-value solutions that drove expanded margins and adjusted EBITDA of 26%. Revenue grew 8% year-over-year, driven by a 9% revenue increase in the Biopharmaceutical and Diagnostic Solutions segment, which offset a slight decline in engineering segment. Revenue from high-value solutions grew 16% and represented 45% of the total company revenue in Q2 2026, driven by a 30% increase in revenue from biologics, the fastest-growing end market. Revenue related to GLPs was approximately 22% to 23% of total company revenue.

Speaker #2: Our second quarter financial results were largely in line with our expectations, highlighted by solid revenue growth and a better mix of high-value solutions that drove expanded margins and adjusted EBITDA of 26%.

Speaker #2: Revenue grew 8% year over year, driven by a 9% revenue increase in the biopharmaceutical and diagnostics solutions segment, which offset a slight decline in engineering segment.

Speaker #2: Revenue from high-value solutions grew 16% and represented 45% of the total company revenue in the second quarter of 2026. Driven by a 30% increase in revenue from biologics, the fastest-growing end market.

Speaker #2: Revenue related to GLPs was approximately 22% to 23% of total company revenue. As we disclosed this morning, we completed the diversity of our California-based subsidiary BARDA Seabreewer, which specializes in contract manufacturing services primarily for consumables and point-of-care diagnostic applications.

Marco Dal Lago: As we disclosed this morning, we completed the divestiture of our California-based subsidiary, Balda C. Brewer, Inc., which specializes in contract manufacturing services primarily for consumables and point-of-care diagnostic applications. This initiative represents another step consistent with our long-term goal to continue optimizing our footprint and accelerating the transition towards more complex, differentiated, and integrated drug delivery systems. On behalf of management, I would like to thank the Balda team for their dedication and contribution to our group over the years. Demand for injectable biologics remains strong, with more than 9,000 injectable assets in the global drug pipeline undergoing clinical evaluation or registration, and more than 60% of those are biologics. Our strategy is firmly anchored in the higher value subsets of the market, and the business is positioned as a leader in biologic applications.

Franco Stevanato: As we disclosed this morning, we completed the divestiture of our California-based subsidiary, Balda C. Brewer, Inc., which specializes in contract manufacturing services primarily for consumables and point-of-care diagnostic applications. This initiative represents another step consistent with our long-term goal to continue optimizing our footprint and accelerating the transition towards more complex, differentiated, and integrated drug delivery systems. On behalf of management, I would like to thank the Balda team for their dedication and contribution to our group over the years. Demand for injectable biologics remains strong, with more than 9,000 injectable assets in the global drug pipeline undergoing clinical evaluation or registration, and more than 60% of those are biologics. Our strategy is firmly anchored in the higher value subsets of the market, and the business is positioned as a leader in biologic applications.

Speaker #2: This initiative represents another step consistent with our long-term goal to continue optimizing our footprint and accelerating the transition toward more complex, differentiated, and integrated drug delivery systems.

Speaker #2: On behalf of management, I would like to thank the BARDA team for their dedication and contribution to our group over the years. The man for injectable biologics remains strong.

Speaker #2: With more than 9,000 injectable assets in the global drug pipeline undergoing clinical evaluation or registration, and more than 60% of those are biologics, our strategy is firmly anchored in the higher value subset of the market and the business is positioned as a leader in biologic applications.

Speaker #2: The rapid growth of biologics, GLP therapies, and the increasing patient adoption of the self-administration of medicines is reshaping how pharmaceutical companies approach product development and commercialization.

Marco Dal Lago: The rapid growth of biologics, GLP therapies, and the increase in patient adoption of the self-administration of medicines is reshaping how pharmaceutical companies approach product development and commercialization. Drug delivery systems are playing an increasingly strategic role in the success of injectable therapies. As a result, we see strong customer demand for integrated solutions that combine device innovation, manufacturing expertise, and supply chain reliability. We believe our broad portfolio of drug delivery platforms and our end-to-end capabilities position Stevanato Group well to support this evolution. With this goal in mind, we are extremely happy that one of our pharmaceutical customers has received regulatory approval in several European countries for a liraglutide-based therapy that incorporates our proprietary Alina variable-dose pen platform. The approval represents an important commercial milestone for our proprietary drug delivery systems and includes two Alina variants for both diabetes and weight management applications.

Franco Stevanato: The rapid growth of biologics, GLP therapies, and the increase in patient adoption of the self-administration of medicines is reshaping how pharmaceutical companies approach product development and commercialization. Drug delivery systems are playing an increasingly strategic role in the success of injectable therapies. As a result, we see strong customer demand for integrated solutions that combine device innovation, manufacturing expertise, and supply chain reliability. We believe our broad portfolio of drug delivery platforms and our end-to-end capabilities position Stevanato Group well to support this evolution. With this goal in mind, we are extremely happy that one of our pharmaceutical customers has received regulatory approval in several European countries for a liraglutide-based therapy that incorporates our proprietary Alina variable-dose pen platform. The approval represents an important commercial milestone for our proprietary drug delivery systems and includes two Alina variants for both diabetes and weight management applications.

Speaker #2: Drug delivery systems are playing an increasingly strategic role in the success of injectable therapies. As a result, we see strong customer demand for integrated solutions that combine device innovation and manufacturing expertise and supply chain reliability.

Speaker #2: We believe our broad portfolio of drug delivery platforms and our end-to-end capabilities position Stevanato Group well to support this evolution. With this goal in mind, we are extremely happy that one of our pharmaceutical customers has received regulatory approval in several European countries for a LiraGutide-based therapy that incorporates our proprietary Alina variable dose pen platform.

Speaker #2: The approval represents an important commercial milestone for our proprietary drug delivery systems and includes two Alina variants for both diabetes and weight management applications.

Speaker #2: This important customer project also embeds our world-class cartridge technology into the Alina pen platform, harnessing the power of our integrated capabilities. Our proprietary devices are manufactured at our facility in Germany, which plays a pivotal role in serving our global pharma and biotech partners.

Marco Dal Lago: This important customer project also embeds our world-class cartridge technology into the Alina pen platform, harnessing the power of our integrated capabilities. Our proprietary devices are manufactured at our facility in Germany, which plays a pivotal role in serving our global pharma and biotech partners. While Alina addresses the need for a variable dose pen platform, we also see a growing market opportunity for treatments that require strict patient adherence to dosing regimens. In response to customer feedback, we recently introduced the Ora to meet this need. The Ora is a novel multi-use, fixed-dose pen injector system compatible with prefilled cartridges delivering volume up to 3 mL. This new product will take time to get to commercial stage, but we see this as a promising future opportunity. Our customer needs are clear.

Franco Stevanato: This important customer project also embeds our world-class cartridge technology into the Alina pen platform, harnessing the power of our integrated capabilities. Our proprietary devices are manufactured at our facility in Germany, which plays a pivotal role in serving our global pharma and biotech partners. While Alina addresses the need for a variable dose pen platform, we also see a growing market opportunity for treatments that require strict patient adherence to dosing regimens. In response to customer feedback, we recently introduced the Ora to meet this need. The Ora is a novel multi-use, fixed-dose pen injector system compatible with prefilled cartridges delivering volume up to 3 mL. This new product will take time to get to commercial stage, but we see this as a promising future opportunity. Our customer needs are clear.

Speaker #2: While Alina addresses the need for a variable dose pen platform, we also see a growing market opportunity for treatments that require strict patient adherence to dosing regimens.

Speaker #2: In response to customer feedback, we recently introduced Diora to meet this need, Diora is a novel multi-use fixed-dose pen injector system compatible with prefilled cartridges delivering volume up to 3 ml.

Speaker #2: This new product will take time to get to the commercial stage, but we see this as a promising future opportunity. Our customer needs are clear, pointing to a solution that enhances patient usability and adherence, directs the supply chain, provides a better answer to new drug product requirements of modern formulation, and, lastly, increases the combination product sustainability and cost-efficiency profile.

Marco Dal Lago: Point to a solution that enhance patient usability and adherence, de-risk supply chain, provide a better answer to new drug product requirements of modern formulation, and lastly, increase the combination product sustainability and cost efficiency profile. We believe we have the right set of expertise and competencies to support our customers with a broad and unique value proposition. Let's turn our attention to the Engineering segment. We are pleased with the continued operational and financial progress in the business. Our Q2 results demonstrate that the initiatives taken under the optimization plan are yielding positive results. Overall, the operations have stabilized, and we are continuing to execute our optimization plan. As we mentioned last quarter, the teams are laser-focused on sales and marketing efforts to expand our opportunity set. We made good progress during the Q2 in winning new orders.

Franco Stevanato: Point to a solution that enhance patient usability and adherence, de-risk supply chain, provide a better answer to new drug product requirements of modern formulation, and lastly, increase the combination product sustainability and cost efficiency profile. We believe we have the right set of expertise and competencies to support our customers with a broad and unique value proposition. Let's turn our attention to the Engineering segment. We are pleased with the continued operational and financial progress in the business. Our Q2 results demonstrate that the initiatives taken under the optimization plan are yielding positive results. Overall, the operations have stabilized, and we are continuing to execute our optimization plan. As we mentioned last quarter, the teams are laser-focused on sales and marketing efforts to expand our opportunity set. We made good progress during the Q2 in winning new orders.

Speaker #2: We believe we have the right set of expertise and competencies to support our customers with a broad and unique value proposition. Let's turn our attention to the engineering segment.

Speaker #2: We are pleased with the continued operational and financial progress in the business. Our second quarter results demonstrate that the initiatives taken under the optimization plan are yielding positive results.

Speaker #2: Overall, the operations have stabilized, and we are continuing to execute our optimization plan. As we mentioned last quarter, the teams are laser-focused on size and marketing efforts to expand our opportunity set.

Speaker #2: We made good progress during the second quarter in winning new orders. We are consciously optimistic, but sales cycles are longer today than in previous years.

Marco Dal Lago: We are cautiously optimistic, but sales cycles are longer today than in previous year. Let's turn to an update in our growth projects in the US and Italy. In the Q2, we remained focused on scaling and executing our growth investments with a disciplined approach, strengthening our operational maturity while expanding capacity to meet customer demand. Starting from Fishers, we recently completed the initial performance qualification on the first EZ-fill Vial line, and we expect to launch customer validation in the near term. The build-out for our first device program remains on track, and we continue to expect commercial production to begin later this year. As these initiatives come together in Fishers, we're expanding our commercial capabilities and reinforcing our position for future growth. Turning to Latina, the syringe ramp-up is ongoing as we continue to validate new customers.

Franco Stevanato: We are cautiously optimistic, but sales cycles are longer today than in previous year. Let's turn to an update in our growth projects in the US and Italy. In the Q2, we remained focused on scaling and executing our growth investments with a disciplined approach, strengthening our operational maturity while expanding capacity to meet customer demand. Starting from Fishers, we recently completed the initial performance qualification on the first EZ-fill Vial line, and we expect to launch customer validation in the near term. The build-out for our first device program remains on track, and we continue to expect commercial production to begin later this year. As these initiatives come together in Fishers, we're expanding our commercial capabilities and reinforcing our position for future growth. Turning to Latina, the syringe ramp-up is ongoing as we continue to validate new customers.

Speaker #2: Let's turn to an update in our growth projects in the US and Italy. In the second quarter, we remained focused on scaling and executing our growth investments with a disciplined approach, strengthening our operational maturity while expanding capacity to meet customer demand.

Speaker #2: Starting from Fishers, we recently completed the initial performance qualification on the first easy fill via line, and we expect to launch customer validation in the near term.

Speaker #2: The build-out for our first device program remains on track, and we continue to expect commercial production to begin later this year. As this initiative came together in Fishers, we are expanding our commercial capabilities and reinforcing our position for future growth.

Speaker #2: Turning to Latina, the syringe ramp-up is ongoing as we continue to validate new customers. In addition, our next generation R2400 cartridge line is expected to be completed and installed in the next couple of months, with commercial production expected in 2027.

Marco Dal Lago: In addition, our next generation, LU400 cartridge line, is expected to be completed and installed in the next couple of months, with commercial production expected in 2027. In summary, our Q2 results were in line with our expectations, reflecting the continued strength of our strategy. We are positioning the business around the most attractive areas of the market, particularly biologics, GLP-1 therapies, and integrated drug delivery systems. The divestment of Balda C. Brewer, Inc. and our continued investment in platforms such as Alina and other premium products reinforces our focus on higher value, differentiated solutions that address the evolving needs of our pharmaceutical customers. At the same time, we are making progress in improving the Engineering segment and advancing our growth investments. I'll turn the call over to Marco for a review of our financial performance.

Franco Stevanato: In addition, our next generation, LU400 cartridge line, is expected to be completed and installed in the next couple of months, with commercial production expected in 2027. In summary, our Q2 results were in line with our expectations, reflecting the continued strength of our strategy. We are positioning the business around the most attractive areas of the market, particularly biologics, GLP-1 therapies, and integrated drug delivery systems. The divestment of Balda C. Brewer, Inc. and our continued investment in platforms such as Alina and other premium products reinforces our focus on higher value, differentiated solutions that address the evolving needs of our pharmaceutical customers. At the same time, we are making progress in improving the Engineering segment and advancing our growth investments. I'll turn the call over to Marco for a review of our financial performance.

Speaker #2: In summary, our second quarter results were in line with our expectations, reflecting the continued strength of our strategy. We are positioned in the business around the most attractive areas of the market, particularly biologics, GLP-1 therapies, and integrated drug delivery systems.

Speaker #2: The devastatory BARDA see brewer and our continued investment in platforms such as Alina and other premium products reinforces our focus on higher value, differentiated solution, that address the evolving needs of our pharmaceutical customers.

Speaker #2: At the same time, we are making progress in the improving the engineering segment and advancing our growth investments. I'll turn the call over to Marco for a review of our financial performance.

Speaker #1: Thanks, Franco. Before I begin, I'd like to clarify that all comparisons refer to the second quarter of 2025. Unless otherwise specified. Let's start on page 10.

Marco Dal Lago: Thanks, Franco. Before I begin, I'd like to clarify that all comparisons refer to Q2 2025, unless otherwise specified. Let's start on page 10. In Q2 2026, revenue grew 8% to EUR 302 million, both on a reported basis and at constant currency rates. This was driven by a 9% growth in the BDS segment, which offset a 2% revenue decline in the engineering segment. Revenue from High-Value Solutions increased 16% in Q2 to EUR 135.9 million and accounted for 45% of total revenue. In Q2 2026, gross profit margin increased 60 basis points to 28.7%. This was driven by the combined improvements in Latina and Fishers, which led to an increase in High-Value Solutions and improved marginality in engineering segment. This was partially offset by the expected increase in depreciation, higher utility costs, and to a lesser extent, currency headwinds.

Speaker #1: In the second quarter of 2026, revenue grew 8% to $302 million. Both on our reported basis and at a cost and currency rate. This was driven by a 9% growth in the BDS segment, which was set at 2% revenue decline in the engineering segment.

Speaker #1: Revenue from high-value solutions, increased 16% in the second quarter, to $135.9 million. And accounted for 45% of total revenue. In the second quarter of 2026, gross profit margin increased 60 basis points, to $28.7%.

Speaker #1: This was driven by the combined improvements in Latina and Fishers, which led to an increase in high-value solutions. And improved marginality in engineering segment.

Speaker #1: This was partially offset by the expected increase in depreciation, higher utility costs, and to a lesser extent, currency headwinds. In the second quarter of 2026, we completed the sale of our California-based subsidiary BALDA Sea Brewer.

Marco Dal Lago: In Q2 2026, we completed the sale of our California-based subsidiary, Balda C. Brewer. We specialize in contract manufacturing services for consumables and point-of-care diagnostic applications. As a result, the company recorded one-time expenses of EUR 12.2 million in connection with the sale and related transaction costs in Q2 2026. The subsidiary was expected to generate revenue of approximately EUR 30 million in fiscal year 2026, and the transaction is expected to be accretive on the full year margins. The sale of Balda C. Brewer, and to a lesser extent, higher startup expenses, unfavorably impacted the group's operating profit margin in Q2. On an adjusted basis, operating profit margin increased 250 basis points to 18%. As expected, the tax rate in Q2 2026 was higher compared with the same period last year.

Speaker #1: We specialized in contract manufacturing services for consumables and point of care diagnostic applications. As a result, the company recorded one-time expenses of $12.2 million in connection with the sale and related transaction costs in the second quarter of 2026.

Speaker #1: The subsidiary was expected to generate revenue of approximately $30 million in fiscal year 2026, and the transaction is expected to be accretive on the full year margins.

Speaker #1: The sale of BALDA Sea Brewer and to a lesser extent, higher startup expenses unfavorably impacted the group's operating profit margin in the second quarter.

Speaker #1: But on an adjusted basis, operating profit margin increased 250 basis points, to 18%. As expected, the tax rate in the second quarter of 2026 was higher compared with the same period last year.

Speaker #1: As a reminder, the prior year period benefited from a tax incentive, which lowered the Italian statutory corporate income tax rate in fiscal year 2025.

Marco Dal Lago: As a reminder, the prior year period benefited from a tax incentive, which lowered the Italian statutory corporate income tax rate in fiscal year 2025, but the incentive was not available in 2026. Additionally, there is no corresponding tax benefit on the sale of Balda C. Brewer, which contributed to the increase in the effective tax rate in the quarter. As a result of the one-time expenses related to the divestment and higher taxes, net profit totaled EUR 23 million, and diluted earning per share were $0.08 in Q2 2026. On an adjusted basis, net profit increased 20% to EUR 37.6 million, and adjusted diluted earning per share increased to $0.14. Adjusted EBITDA increased 21% to EUR 78.7 million, and adjusted EBITDA margin increased to 180 basis points to 26% in Q2 2026. Moving to segment results on page 11.

Speaker #1: But the incentive was not available in 2026. Additionally, there is no corresponding tax benefit on the sale of BALDA Sea Brewer. Which contributed to the increase in the effective tax rate in the quarter.

Speaker #1: As a result of the one-time expenses related to the divestment and higher taxes, net profit totaled $23 million, and diluted earnings per share were $0.08 in the second quarter of 2026.

Speaker #1: On an adjusted basis, net profit increased 20% to $37.6 million. And adjusted diluted earnings per share increased to $0.14. Adjusted EBITDA increased $21% to $78.7 million.

Speaker #1: And adjusted EBITDA margin increased $280 basis points, to $26% in the second quarter of 2026. Moving to segment results on page 11. In the second quarter of 2026, revenue from the BDS segment increased 9% to $266.2 million.

Marco Dal Lago: In Q2 2026, revenue from the BDS segment increased 9% to EUR 266.2 million and grew 10% on a constant currency basis. Strong growth in premium Nexa syringes and, to a lesser extent, Alba syringes and EZ-fill vials led to a 16% increase in revenue from High-Value Solutions. To EUR 135.9 million, which represented approximately 51% of segment revenue. Revenue from other containment and delivery solutions increased 3% to EUR 130.3 million, mostly driven by growth in standard syringes and bulk cartridges, as well as variable compensation tied to a customer contract. Gross profit increased by EUR 6.6 million in Q2 2026, reflecting the combined improvements in the new plants as we continue to ramp up operations, which led to an increase in High-Value Solutions. These positive trends were partially offset by the expected higher depreciation and increase in utilities costs, and to a lesser extent, currency headwinds.

Speaker #1: And grew 10% on a cost and currency basis. Strong growth in premium NexSys syringes and, to a lesser extent, Alba syringes and DC fill vials led to a 16% increase in revenue from high-value solutions, to $135.9 million.

Speaker #1: which represented approximately 51% of segment revenue. Revenue from other containment and delivery solutions increased 3% to $130.3 million, mostly driven by growth in standard syringes and bulk cartridges, as well as variable compensation tied to a customer contract.

Speaker #1: Gross profit increased by $6.6 million in the second quarter of 2026, reflecting the combined improvements in the new plants as we continue to ramp up operations.

Speaker #1: Which led to an increase in high-value solutions. This positive trends were partially offset by the expected higher depreciation, an increase in utilities costs, and to a lesser extent, currency headwinds.

Speaker #1: As a result, gross profit margin decreased by 10 basis points to 31.1%. The operating profit margin was impacted by the sale of BALDA and declined 330 basis points to 15.8%.

Marco Dal Lago: As a result, gross profit margin decreased by 10 basis points to 31.1%. The operating profit margin was impacted by the sales of Balda and declined 330 basis points to 15.8%. In Q2 2026, revenue from the Engineering segment decreased 2% to EUR 35.8 million due to lower sales in pharma visual inspection and glass converting, which offset growth in the assembling lines and after-sales activities. In Q2 2026, gross profit margin improved by 540 basis points to 12%, and operating profit margin increased 370 basis points to 2.9%. Ongoing efforts under our business optimization plan led to a strong margin expansion as the segment continues to make steady operational and financial progress. Margins also benefited from improved operating results and the favorable mix in our Danish operations from newly secured projects in 2026, which is helping to refresh the project portfolio.

Speaker #1: In the second quarter of 2026, revenue from the engineering segment decreased 2% to $35.8 million due to lower sales in pharma visual inspection and glass converting, which offset growth in the assembling lines and after-sales activities.

Speaker #1: In the second quarter of 2026, gross profit margin improved by 540 basis points, to 12%. And operating profit margin increased 370 basis points, to 2.9%.

Speaker #1: Ongoing efforts under our business optimization plan led to a strong margin expansion as the segment continues to make steady operational financial progress. Margins also benefited from improved operating results and a favorable mix in our Danish operations.

Speaker #1: From newly secured projects in 2026. Which is helping to refresh the project portfolio. While margins improved in the quarter and the team is making good progress in refreshing the backlog and the pipeline, we continue to remain somewhat cautious due to the elongated sales cycle and project phasing.

Marco Dal Lago: While margins improved in the quarter and the team is making good progress in refreshing the backlog and the pipeline, we continue to remain somewhat cautious due to the elongated sales cycle and project phasing. Please turn to the next slide for a review of our balance sheet and cash flow. We ended the quarter with cash and cash equivalents of EUR 78.6 million and net debt of EUR 360.3 million. We believe we have adequate liquidity to fund our strategic priorities through a combination of cash on hand, available credit lines, cash generated from operations, and the ability to access additional financing. For Q2 2026, capital expenditures totaled EUR 52 million, mostly related to growth, investment in the new plants, and for our Alina device program in Germany, and contract manufacturing activities. In Q2 2026, net cash flow from operating activities totaled EUR 31.9 million.

Speaker #1: Please turn to the next slide for a review of our balance sheet and cash flow. We ended the quarter with cash and cash equivalents of $78.6 million.

Speaker #1: And net debt of $360.3 million. We believe we have adequate liquidity to fund our strategic priorities through a combination of cash on hand, available credit lines, cash generated from operations, and the ability to access additional financing.

Speaker #1: For the second quarter of 2026, capital expenditures totaled $52 million, mostly related to growth, investment in the new plants, and for our Alina device program in Germany.

Speaker #1: And contract manufacturing activities. In the second quarter of 2026, net cash flow from operating activities totaled $31.9 million. Cash used in property, plant, and equipment and intangible assets was $65.7 million.

Marco Dal Lago: Cash used in property, plant, and equipment and intangible assets was EUR 65.7 million. Consequently, the company reported negative free cash flow of EUR -32 million for Q2 2026. Please turn to the next slide for an update of our full-year guidance. The divestiture of our California-based subsidiary has been considered in our full-year guidance, with a reduction revenue for fiscal 2026 of approximately EUR 15 million. This revenue reduction is partially offset by better-than-anticipated currency translation and higher organic growth in our core business. As a result, we now expect revenue in the range of EUR 1 billion to 160 million, to EUR 1 billion 280 million. The divestiture, while small, is expected to be accretive to margins at the central point of our guide, and we now expect adjusted EBITDA between EUR 335 million to 345.2 million.

Speaker #1: Consequently, the company reported negative free cash flow of $32 million, for the second quarter of 2026. Please turn to the next slide for an update of our full year guidance.

Speaker #1: The divestiture of our California-based subsidiary has been considered in our full year guidance. With the reduction of revenue for fiscal 2026 of approximately $15 million.

Speaker #1: This revenue reduction is partially offset by better than anticipated currency translation. And higher organic growth in our core business. As a result, we now expect revenue in the range of $1,260,000,000 to $1,280,000,000.

Speaker #1: The divestiture, while small, is expected to be accretive to margins at the central point of our guide. And we now expect adjusted EBITDA between $335 million and $345.2 million.

Speaker #1: We are also narrow in the range for adjusted diluted EPS. Which now expect to range between $60 to $62 for the fiscal year. Our full year 2026 guidance assumes the following.

Marco Dal Lago: We are also narrowing the range for adjusted diluted EPS, which we now expect to range between $0.60 to $0.62 for the fiscal year. Our full-year 2026 guidance assumes the following: The BDS segment is expected to grow on a reported basis, high single digits. Engineering is expected to decline by mid-single digits to low double digits. High-Value Solutions are expected to range between 47% to 48% of total company revenue. Free cash flow is expected to range from breakeven to EUR +20 million. We are updating the tax rate for 2026 and now expect a tax rate of approximately 28.2%, adjusted for the divestment. The higher tax rate is expected to be offset by lower-than-anticipated depreciation and amortization and financial expenses. I will now hand the call back to Franco for closing remarks.

Speaker #1: The BDS segment is expected to grow on a reported basis by high single digits. Engineering is expected to decline by mid-single digits to low double digits.

Speaker #1: High-value solutions are expected to range between 47% to 48% of total company revenue. Free cash flow is expected to range from break-even to positive $20 million.

Speaker #1: We are updating the tax rate for 2026, and now expect a tax rate of approximately 28.2%, adjusted for the divestment. The higher tax rate is expected to be offset by lower than anticipated depreciation and amortization, and financial expenses.

Speaker #1: I will now hand the call back to Franco for closing remarks.

Speaker #2: Overall, we are pleased with our performance in the first half of fiscal 2026, which was in line with our expectations. It further highlights the continued strength of our core business and our ability to capitalize on the market opportunities in biologics, which remains the most attractive and fastest-growing end market.

Marco Dal Lago: Overall, we are pleased with our performance in the H1 of fiscal 2026, which was in line with our expectations. It further aligns the continued strength of our core business and our ability to capitalize on the market opportunities in biologics, which remains the most attractive and fastest-growing end market. This momentum reflects strong demand for premium containment and delivery solutions, serving complex injectable therapies, including biosimilars, monoclonal antibodies, GLP-1 therapies, and other advanced treatments. With the rapid rise of patient adoption of drug delivery devices, pharmaceutical customers are increasingly seeking integrated partners that can combine device innovation, manufacturing expertise, and supply chain reliability. Platforms such as Alina support this strategy by demonstrating Stevanato Group's ability to bring together drug containment and delivery device capabilities in a differentiated, commercially relevant solution. We believe we are uniquely positioned to respond to this market opportunity.

Franco Stevanato: Overall, we are pleased with our performance in the H1 of fiscal 2026, which was in line with our expectations. It further aligns the continued strength of our core business and our ability to capitalize on the market opportunities in biologics, which remains the most attractive and fastest-growing end market. This momentum reflects strong demand for premium containment and delivery solutions, serving complex injectable therapies, including biosimilars, monoclonal antibodies, GLP-1 therapies, and other advanced treatments. With the rapid rise of patient adoption of drug delivery devices, pharmaceutical customers are increasingly seeking integrated partners that can combine device innovation, manufacturing expertise, and supply chain reliability. Platforms such as Alina support this strategy by demonstrating Stevanato Group's ability to bring together drug containment and delivery device capabilities in a differentiated, commercially relevant solution. We believe we are uniquely positioned to respond to this market opportunity.

Speaker #2: This momentum reflects strong demand for premium containment and delivery solutions, serving complex injectable therapies, including biosimilars, monoclonal antibodies, GLP-1 therapies, and other advanced treatments.

Speaker #2: With the rapid rise of patient adoption of drug delivery devices, pharmaceutical customers are increasingly seeking integrated partners that can combine device innovation, manufacturing expertise, and supply chain reliability.

Speaker #2: Platforms such as Alina support this strategy by demonstrating Stevanato Group's ability to bring together drug containment and delivery device capabilities in a differentiated commercially relevant solution.

Speaker #2: We believe we are uniquely positioned to respond to this market opportunity. Overall, we are squarely focused on growing our premium high-value solutions in both drug containment and drug delivery systems to best position the company to capture the rising opportunities in injectable therapies, particularly biologics.

Marco Dal Lago: Overall, we are squarely focused on growing our premium high-value solutions in both drug containment and drug delivery systems to best position the company to capture the rising opportunities in injectable therapies, particularly biologics. Our goal is to move further up the value chain and deliver sustainable, profitable growth, expanded margins, and long-term shareholder value.

Franco Stevanato: Overall, we are squarely focused on growing our premium high-value solutions in both drug containment and drug delivery systems to best position the company to capture the rising opportunities in injectable therapies, particularly biologics. Our goal is to move further up the value chain and deliver sustainable, profitable growth, expanded margins, and long-term shareholder value.

Speaker #2: Our goal is to move further up the value chain and deliver sustainable, profitable growth, expanded margins, and long-term shareholder value.

Speaker #3: Thank you. This is the conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone.

Operator: Thank you. This is the conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star 1 on their touch-tone telephone. To remove yourself from the question queue, please press Star 2. Please pick up the receiver when asking questions. Anyone who has a question may press Star 1 at this time. We kindly ask you to limit to one question and one follow-up only, and join the queue again for any further questions. We will pause for a moment as participants are joining the queue. First question is from Michael Ryskin, Bank of America.

Speaker #3: To remove yourself from the question queue, please press star, then two. Please pick up the receiver when asking questions. Anyone who has a question may press star, then one at this time.

Speaker #3: We kindly ask you to limit to one question and one follow-up only, and join the queue again for any further questions. We will pause for a moment as participants are joining the queue.

Speaker #3: First question is from Michael Rishin, Bank of America.

[Analyst] (Bank of America): Hi, this is Avantika on for Mike. Thank you for taking our question. You updated your BDS growth outlook from high single digits to low double digits to now high single digits. Can you walk us through what drove that change and whether it reflects only the divestiture or any other changes in the underlying business? Thank you.

Speaker #4: Hi, this is Avantika Ann from Mike. Thank you for taking our question. You updated your BDS growth outlook from high single digits to low double digits, and now to high single digits.

Speaker #4: Can you walk us through what drove that change, and whether it reflects only the divestiture or any other changes in the underlying business? Thank you.

Speaker #2: Yes. Thanks for the question, Avantika, Marco, speaking. The updated guide has already reported basis. We updated to high single digits. Nevertheless, the organic growth is still double digit because we reduce by approximately $15 million related to the disinvesture.

Marco Dal Lago: Yes, thanks for the question, Avantika. Marco speaking. The updated guide on the reported basis, we updated to high single digits. Nevertheless, the organic growth is still double digits because we reduce by approximately EUR 15 million related to the divestiture, and on the other side, we increase for approximately EUR 8 million related to the lower currency headwind. You probably remember at the beginning of the year, we started the year with estimation of EUR 18 million of currency headwind on the top line, all related to BDS segment. After H1, with approximately EUR 9 million currency headwind, we can see now H2, more balanced. We have a total currency headwind in the model of approximately EUR 10 million.

Speaker #2: And on the other side, we increase for approximately $8 million related to the lower currency headwind. You probably remember at the beginning of the year, we started the year with estimation of $18 million of currency headwind on the top line.

Speaker #2: All related to BDS segment. After the first half of the year, with approximately $9 million currency headwind, we can see now the year the second part of the year more balanced.

Speaker #2: So we have a total currency headwind in the model of approximately $10 million. So $8 million favorable in currency. $15 million headwind related to the divesture.

Marco Dal Lago: EUR 8 million favorable in currency, EUR 15 million headwind related to the divestiture, and we increased a couple of million our organic growth in our core business.

Speaker #2: And we increased our organic growth in our core business by a couple of million.

[Analyst] (Bank of America): Okay, great. Thank you for that clarification. As your GLP-1 exposure continues to increase, are you seeing growth broaden across the non-GLP-1 biologics as well, or is still GLP-1 the primary growth driver for HVS?

Speaker #4: Okay, great. Thank you for that clarification. And then, as your GLP-1 exposure continues to increase, are you seeing growth broaden across the non-GLP-1 biologics as well, or is GLP-1 still the primary growth driver for HVS?

Speaker #2: Yes. Thank you for the question. We all know that GLP-1s are a phenomenal drug class, and we expect them to continue to represent strong, long-term, durable tailwinds in the coming years.

Franco Stevanato: Yes, thank for the question. We all know that the GLP-1s are a phenomenal drug class that we expect to continue to represent a strong long-term durable tailwind the next years. Where Stevanato Group is laser-focused in this moment and in next year to come is on biologics. Biologics is a phenomenal opportunity for Stevanato. Just to give you some numbers, in the industry, there are more than 9,000 injectable assets in the global drug pipeline, and more than 60% are going to be in biologics through injections administration. The reason why we are heavily invested through our plants in Europe, US, we are heavily invested in order to expand our proprietary devices in term of drug delivery system is a key platform in order to try to maximize our leadership position in the next year to come in biologics.

Speaker #2: But where Stevanato Group is laser-focused at this moment and in the next year to come is on biologics. Biologics are a phenomenal opportunity for Stevanato.

Speaker #2: Just to give you some numbers, in the industry there are more than 9,000 injectable assets in the global drug pipeline, and more than 60% are expected to be biologics administered through injection or self-administration.

Speaker #2: So the reason why we are heavily investing through our plans in Europe and the United States—we are heavily invested in order to expand our proprietary devices in terms of drug delivery systems, specifically the EZ-fill platform—is to try to maximize our leadership position in the years to come in biologics.

Speaker #2: In 2026, we are delivering 6% of growth in biologic, most of the reason is because we are the early stage are more revenue that we are generating for client that are in phase two and phase three.

Franco Stevanato: In 2026, we have delivered 6% of growth in biologics. Most of the reason is because we are the early stage, are more revenue that we are generating from clients that are in phase II and phase III. We have started a big strategic goal is to be 5 in this molecule that will represent a tailwind the next year to come.

Speaker #2: But we are starting the big strategic goal is to be five with in this molecule that will represent a tailwinds the next year to come.

[Analyst] (Bank of America): Great. Thank you so much.

Speaker #4: Great. Thank you so much.

Speaker #3: Next question is from David Windley at Jefferies.

Operator: Next question is from David Windley, Jefferies.

David Windley: Hi, good morning. Good afternoon. Thanks for taking my question. Wanted to follow up on that and your comments in the release in your prepared remarks about a move toward premium high-value solutions. Franco, I was hoping, one, you could talk about which products in your portfolio you consider to be the premium products within high-value solutions, and then presuming Alina is one of those, how many countries and what is the size of the opportunity with this recent approval of Alina for liraglutide? Thanks.

Speaker #5: Hi. Good morning, good afternoon. Thanks for taking my question. Wanted to follow up on that and your comments in the I think in the release in your prepared remarks about a move toward premium high-value solutions.

Speaker #5: So, Franco, I was hoping, first, you could talk about which products in your portfolio you consider to be the premium products within high-value solutions.

Speaker #5: And then presuming Alina is one of those how many countries and kind of what is the size of the opportunity with this recent approval of Alina for Liraglutide?

Speaker #5: Thanks.

Speaker #2: Thank you, David. First of all, let me share that we are so excited and proud because it took in Stevanato eight years to develop and to launch on the market this Alina product.

Franco Stevanato: Thank you, David. First of all, let me share that we are so excited and proud because it took in Stevanato 8 years to develop and to launch on the market this Alina product. We start with our R&D department in 2000, 8 years ago, even more. This is why in 2016, we acquired the what so-called Balda in Germany that today is going to become a sort of a hub in order to produce this IP product for Stevanato.

Speaker #2: We start with our R&D department in 2008 years ago, even more. This is the reason why in 2016, we acquired the so-called Balta Germany.

Speaker #2: Today, it's going to become a sort of hub in order to produce this IP product for Stevanato. So, the fact that now we were validated in Europe, in many countries, for this Alina product—both for diabetes and for weight loss management treatment—is going to recognize that Stevanato today is playing in what we so-called Champions League.

Franco Stevanato: The fact that now we were validated in Europe, in many countries for this Alina product, both for diabetes and for weight loss management treatment, is going to recognize that Stevanato today play in what we so-call Champions League, because we are not serving any more of the product through the CMO business model, but we are serving our IP product, and the difference that has Stevanato, that we don't sell only the drug delivery system, we are selling what we so-call integrated system approach, where there are always our glass cartridge inside.

Speaker #2: Because we are not serving anymore the product through the CMO business model, but we are serving our IP product and the different that have Stevanato that we don't sell only the drug delivery system.

Speaker #2: We are selling what we so-called integrated system approach where there are always our glass cartridge inside. Today, we are delivering our Alina pen and our cartridge to what's so-called a system integrator are a specialized partner that are going to take care what is related to the devices, the cartridges, and the filling and the regulatory support in order to help many big international biosimilar clients, both in Europe and United States, to launch on the market this biosimilar.

Franco Stevanato: Today, we are delivering our Alina pen and our cartridges to what so-call a system integrator, are a specialized partner that are going to take care of what is related to the devices, the cartridges, and the filling, and the regulatory support in order to help many big international biosimilar clients, both in Europe and United States, to launch on the market this biosimilar. Today, Alina is having very strong traction for what is related to liraglutide, what is the treatment of the weight losses. What I would like to underline, we are at the very early stage because before this validation, there were a lot of prudent approach for many clients about the functionality of this device. Today, this official registration is opening and boosting the traction of other validation worldwide, and where all this production we are going to produce to our plant in Germany.

Speaker #2: Today, Alina is having very strong traction for what is related to Liraglutide, what is the treatment of the weight losses. But what I would like to underline, we are at the very early stage because before this validation, there were a lot of prudent approach for many clients about the functionality of this device.

Speaker #2: Today, this official registration is opening and boosting the traction of other validation worldwide and where all this production we are going to produce through our plant in Germany.

Speaker #2: Like I already mentioned last year, we already started last year to renovate and upgrade one big area of production in order to store in heavily industrial production for Alina in the next years.

Franco Stevanato: Like I already mentioned last year, we already start last year to renovate and upgrade one big area of production in order to store in heavily industrial production for Alina in the next years. In parallel, also, we start to develop and launch our Deora, that is an evolution of our Alina product that is perfectly fitting for certain treatment where patients, they need a strong accuracy of the doses. This is the reason why this is the product we are already registered on Alina, is further helping to boost the medium-term adoption. I want to say, sorry to use my Latin approach, that this is going to be maybe one of our most big milestones in 2026.

Speaker #2: In parallel also, we started to develop and launch our Deora that is an evolution of our Alina product that is perfectly fitting for certain treatment where patient they need a stronger currency of the doses.

Speaker #2: And this is the reason why this is the path that we are already registered on Alina is for the helping to boost the middle term deduction.

Speaker #2: So I want to say sorry to use my Latin approach that this is going to be maybe one of our most big milestone in 2027, 2026.

David Windley: To follow up, I presume your enthusiasm suggests to me that Alina and, I'll get the name right, Deora-

Speaker #5: So, to follow up, I presume your enthusiasm suggests to me that Alina—and I'll get the name wrong, Aora—are premium products. I'd love to hear, what are the other ones that you consider premium within high-value?

David Windley: To follow up, I presume your enthusiasm suggests to me that Alina and, I'll get the name right, Deora-

Franco Stevanato: Yeah

David Windley: are premium products.

Franco Stevanato: Correct.

David Windley: I'd love to hear what are the other ones that you consider premium within high value, and if you would-

David Windley: I'd love to hear what are the other ones that you consider premium within high value, and if you would, of the 47% to 48% of revenue that is high value, what percent of that is currently premium high value? Thank you.

Speaker #5: And if you would, of the 47 to 48 percent of revenue that is high-value, what percent of that is currently premium high-value? Thank you.

Franco Stevanato: Sure

David Windley: of the 47% to 48% of revenue that is high value, what percent of that is currently premium high value? Thank you.

Franco Stevanato: Alina is in the range of premium product. The revenue around Alina already captured in our guidance 2026, and most probably in the next year to come, Alina will generate a double-digit revenue growth in the Alina product. Where we are also facing a strong traction, strong success on the market is what we call our Alba syringes, because we launched these syringes many years ago for certain ophthalmic application. Today, we see more and more strong traction customers that are going to adopt the monoclonal antibody. Also here, we are heavily investing in capacity, David, here at the plant in Piombino Dese. In the next phase, we are going also to move industrial capacity into the plant in Fishers in order to serve the biologic market directly from Fishers.

Speaker #2: Alina is in the range of premium product. The revenue around Alina are already captured in our guidance 2026. Most probably in the next year to come, Alina will generate double-digit revenue growth in the Alina product.

Speaker #2: Where we are also facing a strong traction, strong success on the market is what we call our Albus ranges. Because we launched these ranges many years ago for certain ophthalmic application.

Speaker #2: Today, we see more and more strong traction in customer that are going to adopt the monoclonal antibody, also here we are heavily investing in capacity, David, here the plants and immunodase and the next phase we're going also to move industrial capacity into the plants in fishers in order to serve the biologic market directly from fishers.

Speaker #5: Okay. Thank you.

David Windley: Okay, thank you.

Speaker #2: You're welcome.

Franco Stevanato: You're welcome.

Speaker #3: Next question is from Paul Knight, KBank Capital Markets.

Operator: Next question is from Paul Knight, KeyBanc Capital Markets.

Speaker #5: Congratulations, Franco. The long-term potential, I think, is obvious. We obvious with Latina and fishers want to capacity utilization will fishers and Latina operate this year.

Paul Knight: Congratulations, Franco. The long-term potential, I think is obvious with Latina and Fishers. What capacity utilization will Fishers and Latina operate this year?

Speaker #2: So today, the demand that we have in fisher Latina is quite in all the 2026, in particular for syringes and next alba and cartridges, bulk cartridges ready to fill is quite stronger, robust pole in for both plants.

Franco Stevanato: Today, the demand that we have in Fishers, Latina is quite, in all the 2026, in particular for syringes, Nexa, Alba, in cartridges, bulk cartridges, ready-to-fill, is quite strong or robust for both plants. The way that we plan our investment are dedicated with capacity and program that we have with customer. All the number of line that we have installed and validated in Latina, we are continuing to install and do the validation throughout the 2026. In Fishers, are with a direct program where the clients do the audit, they do the validation, and then we have dedicated lines. Our approach is always to maintain certain free capacity in order to enhance our plans, to have the flexibility also to do the sampling and the validation for the future program that we are going to start to host the next year to come.

Speaker #2: The way that we plan our investment are dedicated with capacity and program that we are with customer. All the number of line that we have installed and validated in Latina, we're continue to install and do the validation throughout the 2026 in fisher are with the direct program where the clients is to the audit, to do the validation, and then we have dedicated line.

Speaker #2: Our approach is always to maintain certain free capacity in order to enhance our plans to have the flexibility also to do the sampling and the validation for the future program that we're going to start to host the next year to come.

Speaker #2: So all overall, the message is demand is robust, is stronger. But also it's important to keep some space in order to perform the validation.

Franco Stevanato: All overall, the message is demand is strong, but also it's important to keep some space in order to perform the validation.

Marco Dal Lago: As a reminder, Paul, Marco speaking, we plan to fully ramp up Fishers by the end of 2028. We still have a way to go there and improving our production and financial performance throughout our next quarters.

Speaker #5: Advisor reminder,

Speaker #4: Paul, Marco speaking. We plan to fully ramp up fishers by the end of 2028. So we still have way to go there. And improving our production and financial performance throughout our next quarters.

Speaker #5: And then could you Franco give us an update on your creating centers of excellence within engineering or where are you in that program?

Paul Knight: Could you, Franco, give us an update on, you were creating centers of excellence within engineering, or where are you in that program?

Franco Stevanato: Sure. Today, we, regarding the engineering, we have two centers. One is in Italy, specialized in visual inspection machine for customized line for certain assembly technology. Denmark is going to be specialized in particular for the sophisticated high-speed line for assembly. The optimization plan initiative that we start more than one year ago, they are delivering positive results that, in fact, you see, Paul, are translating also in our revenue, in our marginality, that are much better in this quarter. This is starting to be a signal of trending for the future quarters. From engineering point of view, the organization and the team are really moving the right direction.

Speaker #2: Sure. Today, we regarded the engineering, we have two center. One is in Italy, specialized in visual inspection machine and for customized line for certain assembly technology.

Speaker #2: And Danmark is going to be specializing in particular for the sophisticated high-speed line for assembly. So the optimization plan initiative that we start more than one years ago, they are delivering positive result.

Speaker #2: In fact, you see Paul are translated also in our revenue and our marginality that are much better in this quarter. And this is starting to be a signal of trend for the future quarter.

Speaker #2: So, from an engineering point of view, the organization and the team are really moving in the right direction. But also, what we are starting to see is a positive signal, because we are more and more making good progress in winning new orders, both with our historical clients and also by starting to build a rich pipeline for new clients, in particular for vision inspection.

Franco Stevanato: Also what we are starting to see positive signal because we are more and more having a good progress in winning new orders, both with our historical clients, and also we are starting to build a rich pipeline for new clients, in particular, for vision inspection. Our goal is really to have a quarter by quarter some improvement in term of revenue and marginality in order to be back to original numbers with more and more in 2027. Also here, the division has started really to deliver good signal of internal revenue marginality.

Speaker #2: So our goal is really to have a quarter by quarters and improvement in term of revenue and marginality in order to be back to original number in more and more in 2027.

Speaker #2: But also here, the division has started really to deliver good signal of in term of revenue marginality.

Speaker #5: Thank you.

Paul Knight: Thank you.

Franco Stevanato: Welcome.

Speaker #2: Welcome.

Speaker #3: Next question is from Larry Solo. CJS Securities.

Operator: Next question is from Larry Solow, CJS Securities.

Larry Solow: Great. Good afternoon, everybody. Just a couple questions. Can you give us a little flavor? You said you mentioned GLPs 22.3% of revenue. Can you just speak GLPs versus non-GLPs in the high-value products or biologics growth, give us an idea what that was. Sounds like GLPs grew faster than overall growth. Can you give us any idea of that?

Speaker #5: Great. Good afternoon, everybody. Just a couple of questions. Can you give us just a little flavor maybe just on you said you mentioned GLPs 22, 23 percent of revenue.

Speaker #5: Can you just speak GLPs versus non-GLPs in the high-value products or biologics growth? Give us an idea what that was. Sounds like GLPs were grew faster than overall growth.

Speaker #5: So can you give us any idea of that?

Franco Stevanato: Sure. Franco speaking. The revenue inside of the BDS segment around biologics represents approximately 42%. In 2022, we were approximately a little bit less than 20%. Today, we are more than 42%. In this moment, GLP-1 is representing a very visible revenue contribution side of biologics because it is already commercial. We are serving two big originators, and we are actively moving in order to maximize our validation through all the biosimilars, both to our syringes Nexa, cartridge SA2 filler. We have many programs around our drug delivery system. It is also true that we are so engaged with several hundred of clients, both big organizations to small startups, in order to really try to maximize our penetration in all the biologics space.

Speaker #2: Sure. So today, Franco speaking, the revenue inside of the BDS segment around biologic represent approximately 42 percent. So we move where in 2022, we were approximately a little bit less than 2020 percent.

Speaker #2: Today, we are more than 42 percent. In this moment, GLP-1 are representing a very visible revenue contribution side of biologic because it's already commercial.

Speaker #2: We are serving too big originator and we are actively moving in order to maximize our validation through all the biosimilar, both to our syringes Nexa, cartridges, say to fill, and also we have many program around our drug delivery system.

Speaker #2: It's also true that we are so engaged with several hundred of clients, both big organization to small startup in order to really try to maximize our penetration in all the biologic space.

Speaker #2: So today, in the biologics space, we have delivered plus 6 percent, like it was mentioned before. But because most of these programs are at early stage, they're not representing a big revenue generation.

Franco Stevanato: Today, in the biologics space, we have delivered +6%, like I was mentioning before, but because most of these programs are at an early stage, they have not represented a big revenue generation. If I can give you a sort of projection, GLP-1 is a well-established opportunistic tailwind that will continue to grow in the next years. Biologics, it will be much more spread to many clients and many therapeutic areas. If you go to combine all these opportunities, it is going to be much bigger in next year to come compared to GLP-1.

Speaker #2: If I can give you a sort of projection, JP1 is a well-established opportunistic tailwinds that will continue to growth in the next years. And biologic, it will be much more spread to many clients and many therapeutic area.

Speaker #2: And then if you go to combine all these opportunities, it's going to be much bigger in next year to come compared to JP1.

Speaker #5: Okay, great. And then a follow-up just on the Alina, if I could just a clarification. So it sounds like this approval culminates several years of work and this validation feels like you're not building in a lot of revenue specifically to this approval this year, but this validation opens a door for a lot for several other approvals.

Larry Solow: Okay, great. A follow-up just on the Alina, if I could, just like a clarification. It sounds like this approval culminates several years of work and this validation. It feels like you are not building in a lot of revenue specifically to this approval this year, but this validation opens the door for several other approvals. I imagine this is multi-year stuff, you must have other customers in the queue. Is that fair to say?

Speaker #5: And I imagine this is multi-year stuff, so you must have other customers in the queue. Is that fair to say?

Speaker #2: Yeah, absolutely. In terms of investment—so, in terms of revenue—revenue around Alina is already captured in our 2026 guidance. What we can tell you is that we are heavily investing in the industrial and commercial capacity in our plants in Germany over the next 12, 24, 36 months in order to be able to serve this growing demand.

Franco Stevanato: Yep, absolutely. In terms of investments, in terms of revenue around Alina are already captured in 2026 in our guidance. What we can tell you that we are heavily investing with the industrial commercial capacity in our plants in Germany, the next 12 to 24 to 46 months, in order to be able to serve this growing demand. Like I mentioned to you before, we count that Alina, he will help to generate double-digit revenue around Alina product in next year to come, focalized in what we call our premium High-Value Solutions product.

Franco Stevanato: 24 to 46 months, in order to be able to serve this growing demand. Like I mentioned to you before, we count that Alina, he will help to generate double-digit revenue around Alina product in next year to come, focalized in what we call our premium High-Value Solutions product. Today, we have done the first registration with a certain number of clients, first in Europe. In the second part of the year, we will receive additional validation in North America. What is more important, the fact that now we have this registration on the market is helping to boost and push other traction from other clients, in particular in biosimilars space, for what is related to weight loss management treatment. This is the real strategic. Our industry usually is a little bit prudent and conservative.

Speaker #2: So like I mentioned to you before, we counted that Alina, he will help to generate double digit revenue around Alina product in the next year to come, focalize in what we call our premium high-value solution product.

Speaker #2: Today, we have done the first registration with a certain number of clients first in Europe, the second part of the year we will receive additional validation in North America.

Franco Stevanato: Today, we have done the first registration with a certain number of clients, first in Europe. In the second part of the year, we will receive additional validation in North America. What is more important, the fact that now we have this registration on the market is helping to boost and push other traction from other clients, in particular in biosimilars space, for what is related to weight loss management treatment. This is the real strategic. Our industry usually is a little bit prudent and conservative.

Speaker #2: But what is more important, the fact that now we have this registration on the market is helping to boost and push other traction from other clients, in particular in the biosimilar space for what is related to weight loss management treatment.

Speaker #2: So this is the real strategic. Our industry usually is a little bit prudent and conservative. Since there is no real product on the market, some clients, they are waiting.

Franco Stevanato: There is no real product on the market, some clients, they are waiting. Now that this is proved, it is opening a big opportunity next year around our IP product.

Speaker #2: Now that this prove is opening a big, big opportunity next year around our IP product.

Speaker #5: Got it. Great. I appreciate that. Thank you.

Larry Solow: Got it. Great. I appreciate that. Thank you.

Speaker #3: Next question is from Brendan Degan, CT.

Operator: Next question is from Brandon Begun, Citi.

Lisa Miles: Brandon?

Speaker #4: Brendan? Oh, yes. Thank you. Excellent, Brendan. Yes, we can.

Brandon Begun: I can hear me.

Brendan Digan: I can hear me.

Lisa Miles: Oh, yes. Thank you. Excellent, Brandon. Yes, we can.

Speaker #5: Sorry about that. I don't know what happened there. I was wondering if we could start off by unpacking the engineering performance in QQ. It's all a nice revamp up in 1Q and kind of towards the lower range of the commentary provided.

Brandon Begun: Sorry about that. Don't know what happened there. I was wondering if we could start off by unpacking the engineering performance in Q2. I saw a nice rebound up in Q1, and kind of was towards the lower range of the commentary provided on the Q1 call. I wonder if you could unpack that a little bit, also kind of go into how kind of customer decision timelines have evolved throughout the quarter and what kind of the backlog looks like as we head into H2 of the year.

Brendan Digan: Sorry about that. Don't know what happened there. I was wondering if we could start off by unpacking the engineering performance in Q2. I saw a nice rebound up in Q1, and kind of was towards the lower range of the commentary provided on the Q1 call. I wonder if you could unpack that a little bit, also kind of go into how kind of customer decision timelines have evolved throughout the quarter and what kind of the backlog looks like as we head into H2 of the year.

Speaker #5: On the 1Q call, so I wonder if you could unpack that a little bit, but then also kind of go into how kind of customer decision timelines have evolved throughout the quarter and what kind of the backlog looks like as we head into the second half of the year.

Speaker #2: I understood a question, sorry, because there was a lot of noise in the microphone. You ask how is the situation with the backlog compared to the first part of the year to the second part of the year?

Franco Stevanato: I understood a question, sorry, because there was a lot of noise in the microphone. You ask how is the situation with the backlog compared to H1 to H2?

Speaker #5: Yeah. So just as you can unpack the engineering performance in QQ.

Brandon Begun: Yeah. Just if you could unpack the engineering performance in Q2.

Brendan Digan: Yeah. Just if you could unpack the engineering performance in Q2.

Speaker #2: See, today we have a healthy pipeline. That is going to be step by step translate in order so if you combine from the beginning of the year to the second part of the year, we are starting really to more and more move this pipeline into order.

Franco Stevanato: See, today, we have a healthy pipeline that is going to be step-by-step translate in order. If you combine from H1 to H2, we are starting really to more and more move this pipeline into order. In fact, we have a very strong progress in winning new orders, in particular for what is related to vision inspection machine, in particular in Europe, in Asia, and technology for assembly for drug delivery system in Europe, US. We see quarter after quarter a progression of the two enlarge the confirmed orders compared to what was the order intake. The trend is starting to become better and better quarter after quarters.

Speaker #2: In fact, we have a very strong progress in winning new orders, in particular for what is related to vision inspection machine. In particular in Europe, in Asia, and as technology for assembly for drug delivery system in Europe and United States.

Speaker #2: So we see quarter after quarter a progression in order to enlarge the confirm orders compared to what was the order intake. So the trend is starting to become better, better quarter after quarters.

Brandon Begun: Got it. Thank you. I wonder if we could touch on the gross and operating margin assumptions for the full year. I believe, given the divestiture, I was wondering if you could just touch on those. I believe the last guide had around 0 to 30 basis points for gross margin and around 50 for operating. How does that change, with the divestiture? Thank you again, and congrats on the quarter.

Brendan Digan: Got it. Thank you. I wonder if we could touch on the gross and operating margin assumptions for the full year. I believe, given the divestiture, I was wondering if you could just touch on those. I believe the last guide had around 0 to 30 basis points for gross margin and around 50 for operating. How does that change, with the divestiture? Thank you again, and congrats on the quarter.

Speaker #5: Got it. Thank you. Then I wonder if we could touch on the growth and operating margin assumptions for the full year. I believe given the divestiture, I was wondering if you could just touch on those.

Speaker #5: I believe the last guide had around 0 to 30 bips for gross margin and around 50 for operating. So how does that change with the divestiture?

Speaker #5: Thank you again and congrats on the quarter.

Speaker #2: Yes, thanks for the question. Regarding our guidance, I'm staying at the midpoint of our guidance. Our plan is to expand reported gross profit by approximately 50 basis points.

Marco Dal Lago: Yes, thanks for the question. About our guidance, I am staying at the center point of our guidance. Our plan is to expand reported gross profit by 50 basis points approximately. If we exclude the one-timer event in Q2, our plan is to increase our adjusted operating profit of 110 basis points compared with last year. As mentioned in our press release, adjusted EBITDA margin at the center point of the guidance is expected to be at 26.8%, expanding 170 basis points compared with last year. This is driven by slightly improved margin in our BDS segment, improved gross profit margin in our engineering segment, and disciplining cost management in SG&A and R&D expenses.

Speaker #2: If we exclude the one-timer event in second quarter, our plan is to increase our adjusted operating profit of 110 basis points compared with last year.

Speaker #2: And as mentioned in our press release, adjusted bid the margin at the center point of the guidance is expected to be at 26.8% expanding 170 basis point compared with last year.

Speaker #2: This is driven by slightly improved margin in our BDS segment, improved gross profit margin in our engineering segment, and discipline in cost management in SCNA and R&D expenses.

Brandon Begun: Great. Thank you.

Brendan Digan: Great. Thank you.

Speaker #5: Great. Thank you.

Speaker #3: Next question is from Mark, ETOC, Stephans, Inc.

Operator: Next question is from Mark Atock, Stephens Inc.

Mac Etoch: Hey, good morning, and thank you for taking my questions. Maybe just to follow up on the previous answer, I think you touched on it a little bit, the variable compensation that you highlighted within the presentation deck, how much was that and how much of a benefit was that to Q2 margins?

Speaker #5: Hey, good morning and thank you for taking my questions. Maybe just a follow-up on the previous answer. I think you touched on it a little bit.

Speaker #5: But the variable compensation that you highlighted within the presentation deck, how much was that and how much of a benefit was that to QQ margins?

Speaker #2: Thanks for the question. Marco speaking. So the variable compensation is tied to one specific contract with the long-lasting customer. It provides a fair compensation for a reduction in volumes compared with the committed volumes from the customer.

Marco Dal Lago: Thanks for the question. Marco speaking. The variable compensation is tied to one specific contract with a long-lasting customer. It provides a fair compensation for a reduction in volumes compared with the committed volumes from the customer. As a reminder, under the contract terms and condition, we have protection in place for changes in forward forecast. Variable consideration compensate us for the cost we had in the quarter, in H1 in term of capacity reservation, workers, labor, depreciation, and so on, so forth, plus a fair compensation of the missing margin.

Speaker #2: And as a reminder, under the contract terms and conditions, we have protection in place for changes in forecast. So variable consideration compensate us for the cost we had in the quarter in the first half of the year in terms of capacity reservation, workers, labor, depreciation, and so on and so forth.

Speaker #2: Plus, a fair compensation of the missing margin.

Speaker #5: Thanks for that, Marco. Maybe just to bear down a little bit more on that. Is it possible to quantify how much of a benefit it was to the quarter?

Mac Etoch: Thanks for that, Marco. Maybe just to bear down a little bit more on that, is it possible to quantify how much of a benefit it was to the quarter?

Speaker #2: No, it's not impacting in significant way the quarter. It's a fair compensation of the missing margin and the cost we had.

Marco Dal Lago: No, it's not impacting in significant way the quarter. It's a fair compensation of the missing margin and the cost we had.

Speaker #5: Got it. Okay. I appreciate that. Thank you.

Mac Etoch: Got it. Okay. I appreciate that. Thank you.

Speaker #3: Next question is from Carl, Tim Rush, Morgan Stanley.

Operator: Next question is from Carl Timras, Morgan Stanley.

Speaker #5: Hi. This is Jason Offer Callum. Thank you for taking our questions. So maybe it's a question on the bottom brewer divestiture. Could you just walk us through the strategic rationale for divesting the business and the business profile?

[Analyst] (Morgan Stanley): Hi, this is Jason off for Calum. Thank you for taking our questions. Maybe just a question on the Balda C. Brewer divestiture. Could you just walk us through the strategic rationale for divesting the business and the business profile? What was the growth profile of that business, and what was the HVS, non-HVS mix for that business? Appreciate the comments that the spinoff was margin-accretive, but was wondering if you could quantify that margin uplift. Thank you.

Speaker #5: What was the growth profile of that business and what was the HVS non-HVS mix for that business? And appreciate the comments that the spinoff was margin creative, but was wondering if you could quantify that margin uplift.

Speaker #5: Thank you.

Speaker #2: Thank you. So, when in 2016 we decided to enter the device space, we asked for two decisions. First, to acquire BALDA, where the main target was the industrial hub in Germany.

Franco Stevanato: Thank you. When in 2016 we decide to enter in the device space, we asked for two decisions. First, to acquire Balda, where the big target was the industrial hub in Germany. When we acquired this company, we discovered there was also a smaller operation in California, in south of Los Angeles. We call Balda C. Brewer, specialized more in contract manufacturing of standard consumable products. When we are starting to develop our R&D center in Milano, more and more our attention focus was to move the standard diagnostic in order to better serve molecular diagnostic. The real goal is really to build a value proposition for our biologic clients in injection in order to deliver not only the glass EZ-fill, also together with the drug delivery system.

Speaker #2: And when we acquired this company, we discovered there was a source of a smaller operation in California in south of Los Angeles. So we call BALDA Seabrewer specialized more in contract manufacturing of standard consumable products.

Speaker #2: So, when we started to develop our R&D center in Milano, more and more our attention focused on moving the standard diagnostic in order to better serve molecular diagnostics. But the real goal is really to build a value proposition for our biologic clients in injection, in order to deliver not only the glass we build, but also together with the drug delivery system.

Speaker #2: Now we are in 2026 where most of our investment are in order really to build capacity for drug delivery system. These plants that is not anymore strategic for Stevanato because it don't have any particular strategy to serve this biologic market.

Franco Stevanato: Now we are in 2026, where most of our investments are in order really to build capacity for drug delivery system. This plant that is not anymore strategic for Stevanato because it don't have any particular strategy to serve this biologic market. We have decided to pass to this program of divestiture in order really to remove some industrial setup not strategic for our biologic clients. About the model, we had previously in our model approximately EUR 30 million revenue for the year and slightly +EBITDA. That's why, let's say, our margin is more accretive with the divestment. This initiative is really represent another step in order really to move the value chain and the product portfolio of Stevanato, our industrial setup, more versus some accretive high-value solution product in order to better serve the biologic market.

Speaker #2: So we have decided to pass to this program of divestiture in order really to remove some industrial setup and not strategic for our biologic clients.

Speaker #1: And about the model, we had previously in our model approximately 30 million revenue for the year. And slightly positive a bit. So that's why we are let's say our margin is more accretive with these investors.

Speaker #2: This initiative is really represent another step in order really to move the value chain and the product portfolio of Stevanato our industrial setup more versus some creative high-value solution product in order to better serve biologic market.

Franco Stevanato: This is one another step, like what we have already done last year. We started to slow down a little bit our attention in Europe for the standard ampoules.

Speaker #2: This is another step, like what we have already done. Last year, we started to slow down a little bit our attention in Europe for the standard impulse.

[Analyst] (Morgan Stanley): Great. No, thank you for the color. I guess maybe just a question on generic GLPs. We've seen patents for semaglutide expire in 2026 in Canada, India, Brazil, and some early generic GLP launches. I'm wondering, will generic GLPs largely use High-Value Solutions as the current branded GLP-1 drugs? Could you just talk about the opportunity from the generics?

Speaker #5: Great. No, thank you for the color. I guess maybe it's a question on kind of generic GLPs. We've seen patents for some of glutide expire in 2026 in Canada, India, Brazil, and some early generic GLP launches.

Speaker #5: I'm wondering, will generic GLPs largely use high-value solutions as the current branded GLP-1 drugs? Could you just talk about the opportunity from the generics?

Speaker #2: So today we serve the GLP-1 market to our originator, to our biosimilar. We serve the syringes Nexa, we serve the cartridges, plasma mostly cartridges say to fill, and also we are starting to maximize with all the biosimilar that are entering the market.

Franco Stevanato: Today, we serve the GLP-1 market to our originator, to our biosimilar. We serve the syringes Nexa. We serve the cartridges in Balda, mostly cartridges EZ-fill®. Also, we are starting to maximize with all the biosimilar that are entering the market. Today, we see that all the biosimilar, they're practically using the same type of administration term injection. Stevanato is acting to serve to this biosimilar that are still at the early phases through syringes Nexa, cartridges EZ-fill®, but even more, we are starting really to deliver what we call the fully integrated system. We are going to add also our proprietary device like Alina®. This is valid for practically all the region. Like I was mentioning before, we started to serve some European market.

Speaker #2: Today we see that all the biosimilar they are practically using the same type of subministration in terms of injection. Stevanato is active to serve to these biosimilar that are still at the early phases through syringes Nexa, cartridges to fill, but even more we are starting really to deliver what we call the fully integrated system where going to add also our proprietary device like Alina.

Speaker #2: So this is valid for practically all the region like I was mentioning before. We started to serve some European market. Now the next phase is to be North America, Latin America, exactly for this type of configuration where there will be or either our syringes or there will be our cartridges plus the Alina

Franco Stevanato: Now the next phase is to be North America, Latin America, exactly for this type of configuration, where there will be only our syringes, or there will be our cartridges plus the Alina product.

Speaker #5: Great. Appreciate the color. Thank you.

[Analyst] (Morgan Stanley): Great. Appreciate the color. Thank you.

Speaker #3: Next question is from Chad Whitavroski, TD Cohen.

Operator: Next question is from Chad Witkowski, TD Cowen.

Speaker #5: Hey everyone. Beyond the BALDA divestment, are there other segments or SKUs that you view as non-core and could potentially be under strategic review currently?

Chad Witkowski: Hey, everyone. Beyond the Balda divestment, are there other segments or SKUs that you view as non-core and could potentially be under strategic review currently?

Chad Wiatrowski: Hey, everyone. Beyond the Balda divestment, are there other segments or SKUs that you view as non-core and could potentially be under strategic review currently?

Franco Stevanato: At the moment, we don't have relevant initiative under the radar. It's also true that if you look from the day of the IPO to today, we invested more than EUR 1.3 billion, mostly around high-value products. It's also true that if you look at the strategy of organization, starting from sales, R&D, product management, operation, and supply chain, the goal is to build a leadership position in biologics. Indirectly, there are step-by-step, a little bit less attention, what we call non-high-value products or certain bulk activity. Make an example, ampoules that we sell from Europe, from Brazil, some other standard plastic component for the diagnostic, where step-by-step, we would like really to reconvert and to use this space in order to better serve our EZ-fill platform, our drug delivery solution.

Speaker #2: At the moment, we don't have relevant initiative under the radar. It's also true that if you look at the from the day of the APO to today, we invest more than $1.3 billion mostly around high-value products.

Speaker #2: It's also true that if you look at the strategy of the organization, starting from Sales, R&D, Product Management, and Operations and Supply Chain, the goal is to build a leadership position in biologics.

Speaker #2: So indirectly, the step-by-step a little bit less attention in what we call non-high-value product or certain bulk activity, y, make an example, Ampus, that we serve from Europe, from Brazil.

Speaker #2: Some other standard plastic component for the agnostic where step-by-step we would like really to reconvert and to use this space in order to better serve our easy fit platform or our drug delivery solution.

Speaker #2: For sure, this is something that we'll do step-by-step gradually because we want really to evolve our value proposition in the next one, two, three, four years.

Franco Stevanato: For sure, this is something that we'll do step-by-step gradually because we want really to evolve our value proposition in the next one to three, four years. Today, no other relevant initiative.

Speaker #2: But today, no other relevant initiative.

Speaker #5: Got it. That's helpful. And then yeah, I was encouraging to see the Alina approvals. Is there an incentive for pharma customers to order from providers who offer both the glass combined with the proprietary device?

Chad Witkowski: Got it. That's helpful. Yeah, it was encouraging to see the Alina approvals. Is there an incentive for pharma customers to order from providers who offer both the glass combined with the proprietary device? Are these approvals symbolic of maybe a broader shift over time, where companies who offer more integrated solutions are positioned stronger in a market that's historically been pretty fragmented?

Chad Wiatrowski: Got it. That's helpful. Yeah, it was encouraging to see the Alina approvals. Is there an incentive for pharma customers to order from providers who offer both the glass combined with the proprietary device? Are these approvals symbolic of maybe a broader shift over time, where companies who offer more integrated solutions are positioned stronger in a market that's historically been pretty fragmented? Thanks for the questions.

Speaker #5: And are these approvals symbolic of maybe a broader shift over time where companies who offer more integrated solutions are positioned stronger in a market that's historically been pretty fragmented?

Speaker #5: Thanks for the questions.

Curtis Moiles: Thanks for the questions.

Franco Stevanato: Today, overall, there is a trend of the pharma industry to outsource as much as they can the supply chain. They can use specialized CMO, they can use company like Stevanato that will serve integrated offering. This is today, there is more and more a visible trend where pharma customer, they try to outsource a big portion of supply chain. The advantage of this system integrated provider, they are very proactive that they don't perform only the filling. They're helping this biosimilar, international biosimilar company, really to take all the type of activity in order really to collect the devices, the cartridges, do the filling, regulatory support in order to enhance this biosimilar to localize in the go-to market. More and more, we see this trend in the industry today. Stevanato practically, what do we do?

Speaker #2: Today all overall, there is a trend of the pharma industry to outsource as much as they can the supply chain. It can be they can use specialized CMO, they can use company like Stevanato that will sell the integrated offering.

Speaker #2: So this is today there is more and more a visible trend where pharma customer they try to outsource a big portion of supply chain.

Speaker #2: The advantage of this system integrated provider they are very proactive that they don't perform only the filling. They're re helping this biosimilar international biosimilar company really to take all the type of activity in order really to collect the devices, the cartridges to the filling, regulatory support in order to enhance this biosimilar to focalize in the go-to-market.

Speaker #2: More and more we see this trend in the industry today. And Stevanato proactively what we do, we use our tech center, we use our specialized hub in Italy, United States, in order to try to capture as much as we can big pieces of this supply chain and increase our value proposition.

Franco Stevanato: We use our tech center, we use our specialized hub in Italy, United States in order try to capture as much as we can, big pieces of this supply chain and increase our value proposition.

Speaker #3: Next question is from Curtis Miles, BNP Paribas.

Operator: Next question is from Curtis Moiles, BNP Paribas.

Curtis Moiles: Hey, thank you for taking my questions. First, just on GLP-1s, obviously that stepped up again as a percentage of revenue compared to Q1 2026. Maybe you can talk about how you're seeing that progress through the year and whether your mid-teens growth guidance remains intact there.

Speaker #5: Hey, thank you for taking my questions. So first, just on GLP-1s, I mean, obviously that stepped up again as a percentage of revenue compared to 1Q26.

Speaker #5: So maybe you can talk about how you're seeing that progress through the year and whether you're sort of mid-teens broke and it remains intact there.

Speaker #2: Okay. Starting from the guidance, we can see a double-digit growth compared to last year. So still significant growth. About the overall market situation, I will hand over to Franco to.

Marco Dal Lago: Okay. Starting from the guidance, we can see a double-digit growth compared to last year. Still a significant growth. About the overall market situation, I will hand over to Franco to elaborate more.

Franco Stevanato: Sure.

Franco Stevanato: Correct. Today in the industry, what we see, the GLP-1 is really what we call at the beginning of this journey, because if you look at all the potential opportunity that we have through our originator clients, even more with the biosimilars are very active in any region of the world, I think that we are really at the tip of the iceberg. Today there are less than 10% of patient penetration, now total potential addressable patient, that is 1.5 billion. We expect that this will continue to represent a strong long-term durable tailwind for all the industry, including Stevanato. The strategy of Stevanato is really to maximize our penetration through the originator like we have done in the past with insulin, and in parallel, try to maximize our presence, our validation in all the biosimilar, not only to our EZ-fill platform, also with our drug delivery system.

Speaker #2: Correct. Today in the industry, what we see that the GLP-1 is really we are really what we call at the beginning of this journey.

Speaker #2: Because if you look at all the potential opportunities that we have with our originator clients, and even more with the biosimilars that are very active in any region of the world, I think that we are really at the tip of the iceberg.

Speaker #2: So today there are less than 10% of patient penetration in a total potential addressable patient that is 1.5 billion. So we expect that this will continue to represent a strong long-term durable tailwinds for all the industry, including Stevanato.

Speaker #2: The strategy of Stevanato is really to maximize our penetration through the originator, like we have done in the past with insulin, and in parallel, try to maximize our presence in biosimilars—not only through our EZ-fill platform, but also with our drug delivery systems.

Speaker #2: Because I think in the next 5 to 10 years, there will be a lot of opportunity to stay in double digits, only through GLP-1 in the next year.

Franco Stevanato: I think the next five to 10 years, there'll be a lot of opportunity to stay in double digits only through GLP-1 in next years. What is important, again, to underline for the second time, that the GLP-1, we want to have a very strong opportunistic approach, but it's limited to one therapeutic class. The real goal of Stevanato, and the reason why we have done the IPO in 2021 in order to finance and build this huge hub in United States and increase the capacity in Europe, is because all the biologic market is growing spread to several tens of hundreds of clients in several therapeutic areas. Is where we want really to play a visible role with all our integrated value proposition.

Speaker #2: What is important again to underline for the second time that the GLP-1 we want to have a very strong opportunistic approach, but it's limited to one therapeutic class.

Speaker #2: The real goal of Stevanato and the reason why we have done the APO in 2021 in order to finance and build this huge hub in United States and increase the capacity in Europe is because all the biologic market is growing spread to several tens of hundreds of clients and several therapeutic areas.

Speaker #2: It's where we want really to play a visible role with all our integrated value proposition starting from easy fit product, syringes, cartridges, and via and move up the value chain to our drug delivery system and to certain client through our tech center we are starting to perform most of fill and finish for non-human use.

Franco Stevanato: Starting from EZ-fill products, syringes, cartridges, and vials, and move up the value chain to our drug delivery system and to certain clients through our tech center, we are starting to perform also fill and finish for non-human use. This is where we really want to focalize SG the next five to eight years.

Speaker #2: This is where we really want to focalize SG the next 5 to 8 years.

Speaker #5: Okay. Thank you. And then moving to the BDS gross margin, I'm just wondering, is this sort of Q2 level a good jumping-off point for the remainder of the year as in should we see it ramp a little bit from here or could it maybe come off a bit?

Curtis Moiles: Okay, thank you. Moving to the BDS gross margin. I'm just wondering, is this sort of Q2 level a good jumping off point for the remainder of the year? Should we see it ramp a little bit from here or could it maybe come off a bit?

Speaker #2: Yes, respect for BDS. To match or overtake the gross profit margin we had in 2025. So we're expecting Q3 and Q4 further margin expansion in our BDS segment.

Marco Dal Lago: Yes, we expect for BDS, to match or overtake the gross profit margin we had in 2025. We're expecting Q3 and Q4 further margin expansion in our BDS segment, driven by the growth in Fishers and Latina, and driven by the fact that we expect a stronger H2 of the year, a better leverage on our fixed expenses, again, mainly driven by Fishers and Latina.

Speaker #2: Driven by the growth in features in Latina, and driven by the fact that we expect a stronger second half of the year. So a better leverage on our fixed expenses.

Speaker #2: Again, mainly driven by features in Latina.

Curtis Moiles: Got it. Thank you.

Speaker #5: Got it. Thank you.

Speaker #3: Next question is from Matt Lero. William Blair.

Operator: Next question is from Matt Larew, William Blair.

Speaker #4: Hi, good morning. Thanks for taking my question. Obviously, a lot has been covered. Just one for me. I know you had a press release a few days ago on the Alina approvals.

Matt Larew: Hi, good morning. Thanks for taking my question. Obviously, a lot's been covered. Just one for me. I know you had a press release a few days ago on the Alina approvals. You've mentioned it a couple of times today. I know that these were already approved, so I'm curious if these are new or different configurations and thus perhaps, new share opportunities for Stevanato. Again, you've covered it a little bit, but just what these approvals mean for you in terms of long-term aspirations in the device space. Thanks.

Speaker #4: You've mentioned it a couple of times today. I know that these were already approved. So I'm curious if these are new or different configurations and thus perhaps new share opportunities for Stevanato and again, you've covered it a little bit, but just what these approvals mean for you in terms of long-term aspirations in the device space.

Speaker #4: Thanks.

Speaker #2: So practically, Matt, with this approval in Europe, there will be an additional approval in the second part of the year in the United States.

Franco Stevanato: Practically, Matt, with this approval in Europe, there will be an additional approval in the second part of the year in the US, we are going to start to deliver to certain number of clients. We have a big number of clients who are going to start to deliver our Alina pen for this liraglutide product together with our cartridges. Translated in number, we are starting to generate revenue with that through selling Alina in 2026. Even more, there will be a progression because these clients are launching the product on the market. The configuration could be Alina product in a different format and with our cartridges.

Speaker #2: We are going to start to deliver to a certain number of clients. We have a large number of clients. We are going to start to deliver our Alina pen for this Elira glutide product together with our cartridges.

Speaker #2: So, translated into numbers, we will start generating revenue from selling Alina in 2026. But even more, there will be a progression, because these clients are launching the product on the market.

Speaker #2: The configuration to be Alina product in the different format and with our cartridges.

Speaker #4: Okay. Thank you.

Matt Larew: Okay, thank you.

Speaker #2: You're welcome.

Franco Stevanato: You're welcome.

Operator: Miss Moiles, gentlemen, there are no more questions registered at this time.

Speaker #3: Maeve Miles. Gentlemen, there are no more questions registered at this time.

Speaker #1: Thank you very much to everyone for joining us for Stevanato Group's second quarter 2026 earnings call. We look forward to speaking with you in the future and enjoy the rest of your summer.

Curtis Moiles: Thank you very much to everyone for joining us for Stevanato Group's Q2 2026 earnings call. We look forward to speaking with you in the future, and enjoy the rest of your summer.

Lisa Miles: Thank you very much to everyone for joining us for Stevanato Group's Q2 2026 earnings call. We look forward to speaking with you in the future, and enjoy the rest of your summer.

Operator: Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.

Q2 2026 Stevanato Group SpA Earnings Call

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