Operator: Good morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the doValue Nine Months 2026 Financial Results Presentation. As a reminder, all participants are in listen-only mode, and after the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Daniele Della Seta, Head of Investor Relations and M&A of doValue. Please go ahead, sir.
Daniele Della Seta: Good morning, everyone. I am Daniele Della Seta. I am joined by Manuela Franchi, our Group CEO, and Davide Soffietti, our Group CFO, as we present doValue's Q3 2026 financial results. Results which are consistent with the messages outlined at our Capital Markets Day last month. Manuela will begin with an overview of our performance and key market dynamics. Davide will then provide a detailed review of the third quarter financial results, cash generations, and financial structure. We will conclude as usual with a Q&A session. Thank you for joining us today. I will now hand over to Manuela.
Manuela Franchi: Good morning, everyone. Four messages stand out on page 3. First, Digital Collection continue to grow profitably and to broaden its client base. On a pro forma basis, Digital Collection generated approximately EUR 70 million of EBITDA in the first nine months, ahead of our initial expectations. We are also seeing the first revenue synergies with our NPE business. The NPE unit recently set up within Digital Collection in Germany has generated EUR 1.5 billion of NPE servicing gross revenue in the third quarter.
Manuela Franchi: The amount is still small, but it shows that the Digital Collection rollout in Germany can be extended to the NPE business. Second, group profitability improved with the highest third quarter EBITDA margin since 2022, driven by Digital Collection and by cost discipline in the NPE and VAS businesses. Third, our cost base continue to flex with revenue across all regions. In Spain, costs fell faster than revenue.
Manuela Franchi: In Italy, cost action absorbed most of the revenue decline. In the Hellenic Region, costs grew more slowly than revenue. Finally, Value-Added Services accelerated in the quarter. Under our new revenue classification, which now includes REO, VAS revenue reached EUR 32 million, up 5% year-on-year, compared with a 4% decline over the first nine months. Growth in the original VAS perimeter in both Italy and the Hellenic Region more than offset the planned scale back of REO servicing. VAS generated EUR 104 million of revenue in the first nine months and represented 18% of group revenue in the third quarter. Page 4 recalls the framework presented at our Capital Markets Day. Our 2027 to 2029 business plan is built around three value engines. The first is Digital Collection, the group growth engine.
Manuela Franchi: We expect the business to continue expanding across clients, sector, and geographies, reaching between EUR 155 million and EUR 165 million of EBITDA by 2029. The second is our NPE business, where the priority is to establish earnings through a lower cost base and implementation of a more automated AI-enabled operating model. We are targeting between EUR 120 million and EUR 130 million of EBITDA by 2029. The third is value-added services, which provide a stable and recurring source of diversification. We expect this business to grow at a mid-single digit rate and generate between EUR 50 million and EUR 60 million of EBITDA by 2029.
Manuela Franchi: Together, these three businesses support our target of EUR 330 million to EUR 350 million of group EBITDA by 2029, with a margin of up to 40%. Our financial framework targets sustainable leverage of between 2x and 2.5x, together with a progressive increase in shareholder remuneration. Execution is underway.
Manuela Franchi: The EUR 10 million share buyback announced at the Capital Markets Day was launched in October. Turning to page 5, the results are consistent with the starting points of the plan. In Digital Collection, the margin gains come from automation. In Germany, AI intervention increased by 117% year-on-year, raising inbound and outbound productivity by around 20%. Across the business, human contacts per file nearly halved since the beginning of the year, and revenue per FTE rose by 23%, so higher volumes do not require a proportional increase in resources. In the NPE and VAS businesses, EBITDA returned to growth in the quarter after a 24% decline in the H1, reflecting a better revenue trend and the cost actions taken across the group. Finally, leverage is on the path set at the Capital Markets Day, and Davide will cover it in detail.
Manuela Franchi: On the next page, we cover commercial activity in NPE servicing and Digital Collection. Starting with NPE servicing, GBV under management stood at EUR 151 billion at the end of September, broadly compared with the EUR 153 billion at year-end 2025, on a like-for-like basis using the Santander perimeter under the new contract. New business was lower than last year as fewer NPE transactions came to market, but the EUR 4.3 billion secured in the first 9 months largely replaced the natural amortization of the portfolio. It was split between EUR 2.1 billion of new mandates and EUR 2.2 billion of forward flow from existing clients. Turning to Digital Collection, file volumes continue to grow, with 7.2 million new files onboarded in the first 9 months of 2026, including 2.2 million in the Q3. Buy Now, Pay Later remains one of the main growth drivers.
Manuela Franchi: Referral volumes from our anchor client increased by more than 80% across its new geographies, with strong growth in the UK, Norway, and Austria, and operation launched in Finland. Growth is also spreading to other sectors. In Germany, utilities revenues increased by 48% year-on-year, while telecom revenue almost doubled. In the UK, telecom revenue increased by 25%. Insurance, a new vertical that started from zero, will likely be a recurring source of business. Since the beginning of 2026, we have added 7 new clients across financial services, e-commerce, telecom, and utilities, and we have started already managing core clients in Spain and in Italy, adding now to Greece. With that, I will hand over to Davide.
Davide Soffietti: Thank you, Manuela, and good morning, everyone. Let us now turn to the financial performance of Q3 on page 8. Gross revenue increased by 46% year-on-year to EUR 180 million, mainly reflecting Digital Collections. In the NPE and Value-Added Services businesses, gross revenue declined by 5% compared with the 13% decline in H1. Net revenue increased by 35% to EUR 148 million. The difference between gross and net revenue growth reflects the operational model of Digital Collections, where a larger share of cost is recorded through outsourcing fees. Outsourcing fees represented 18% of gross revenues in the quarter, compared with 11% in the prior year period. EBITDA, excluding non-recurring items, increased by 70% to EUR 65 million, with a margin of 36%, 5 percentage points higher year-on-year. Digital Collection contributed EUR 25 million of EBITDA in the quarter.
Davide Soffietti: In the NPE and Value-Added Services businesses, EBITDA grew by 5% year-on-year despite the lower revenue base, as cost savings more than offset the decline in net revenue. The improving profitability also reflects the strong execution of our voluntary exit plan, which has involved more than 150 FTEs since the beginning of the year. Let's now move to page 9. Non-NPE activities represented 53% of group revenue in the quarter, driven by Digital Collections and Value-Added Services. Digital Collections generated EUR 63 million of revenues in Q3, representing 35% of group revenue. Revenue increased by 13% compared with Q2, supported by the continued boarding of new files. Looking at the revenue by region, the Hellenic Region generated EUR 55 million of revenue, up 9% year-on-year. Servicing revenue returned to grow, while Value-Added Services grew 22%.
Davide Soffietti: In Italy, revenue was EUR 52 million, as the year-on-year decline continued to narrow thanks to growing UTP and Value-Added Services, which were up 21% and 10% respectively year-on-year, and now represent more than half of revenue in the country. Finally, revenue in Spain declined to EUR 10 million, reflecting the deliberate scaling back of REO servicing in favor of more focused and higher-margin activities. Turning to costs on page 10, total operating expenses increased by 36% to EUR 115 million, entirely due to the consolidation of Digital Collection, which contributed EUR 38 million of cost in the quarter. In Digital Collections, the cost base was broadly stable on the quarter, so revenue growth translated into a 39% EBITDA margin, up from 31% in Q2. In the NPE and VAS businesses, operating expenses declined by 10% year-on-year to EUR 77 million.
Davide Soffietti: HR costs decreased by EUR 4 million, while administrative expenses were down 14%, mainly driven by 35% reduction in SG&A. At the same time, we continue to invest selectively in IT to support automation and the transformation of our operating model. Looking at the regional performance, Italy preserved the most recent profitability despite the lower revenue base. EBITDA declined by only EUR 2.5 million compared with an EUR 8 million reduction in revenue, as operating costs decreased by 12%. Excluding group costs, EBITDA was EUR 14 million, broadly stable in Q3 with a 26% margin. The Hellenic Region delivered EBITDA of EUR 28 million, up 13% year-on-year, as revenue grew faster than costs, with a margin of 51%. In Spain, EBITDA more than doubled to EUR 2 million despite lower revenue.
Davide Soffietti: The margin increased to 22% from 7% in Q3 of the last year, reflecting the benefits of the strategic step-back of REO servicing and the 34% reduction in the cost base. Moving on to page 11. In the first 9 months, EBITDA, excluding non-recurring items, grew by 15% to EUR 157 million. The margin was 33%, slightly below last year, mainly reflecting lower disposal activity in the first quarter compared with Q1 2025. On a pro forma basis, including Digital Collection for the full 9 months, the group generated EUR 185 million of EBITDA with a 34% margin and EUR 19 million of ordinary net income, supporting our full year 2026 guidance. Moving on page 12, let me take you through the main items between EBITDA and group net income on an ordinary basis.
Davide Soffietti: Depreciation, amortization, and net impairment increased by around EUR 7 million, mainly reflecting the consolidation of Digital Collection, the related preliminary purchase price allocation, and our investment program. Despite this increase, EBIT more than doubled to EUR 38.3 million compared with EUR 18.3 million in Q3 of last year. The EBIT margin rose from 15% to 21%. Net financial expenses increased by EUR 6 million to EUR 17.1 million. This mainly reflects the additional cost of debt incurred to fund the acquisition of Digital Collection, including the temporary additional burden associated with the holding the receivables portfolio pending its disposal. As a result, earnings before tax increased to EUR 21.2 million from EUR 7.2 million last year.
Davide Soffietti: Income taxes increased to EUR 13.6 million, mainly reflecting the taxes associated with the profit generated by Digital Collection, while minorities increased by approximately EUR 1 million, reflecting the contribution attributable to our partnership with BPER, Banco BPM, and Eurobank in Greece. Overall, ordinary net income returned to positive territories at EUR 3.3 million compared with a loss of EUR 0.4 million in Q3 of last year. Non-recurring items amounted to EUR 8.7 million and mainly related to the pre-financing of the term loan and the bond tap completed in July, as well as costs associated with employee exits. Moving to page 13, free cash flow remained positive in Q3, which is typically our weakest quarter for cash generation, while Q4 is the strongest. Starting from reported EBITDA of EUR 64 million, CapEx amounted to EUR 10 million. EBITDA less CapEx was therefore EUR 53 million, a cash conversion of 84%.
Davide Soffietti: The bridge also includes EUR 31 million of principal collection from the Digital Collection owned portfolio. Until the disposal is completed, this collection remains part of the ordinary operating activity of the business. This is why collections are included in operating cash flow, while portfolio purchases are treated as an investing cash flow and shown separately below free cash flow. In the quarter, collection largely funded the EUR 38 million invested in new portfolios, reflecting the strong intake of new files. Since consolidation, Digital Collection has generated EUR 30 million, EUR 3 million of cash, even after the continued investment in portfolio. Moving to the bridge, lease payments amounted to EUR 5 million, and redundancy payouts were EUR 3 million. Net working capital absorbed EUR 60 million, while other asset releases absorbed EUR 30 million. These two movements mainly affect three items.
Davide Soffietti: Around EUR 15 million of transaction-related effects, such as acquisition costs and accruals related to the recent refinancing transaction. EUR 7 million of VAT payment in Greece, which we expect to recover from the tax authority, and EUR 16 million between timing effect of management incentive payout and other tax payments. On working capital, we had expected to collect around EUR 20 million of receivable in the quarter, which would have turned the EUR 6 million absorption into positive contribution of around EUR 60 million. Unfortunately, due to technical issue, 2 clients postponed the amounts on 5 October 2026, so the benefit will be reflected in Q4.
Davide Soffietti: Cash flow from operation was therefore EUR 39 million compared with EUR 21 million in Q3 of last year. After EUR 20 million taxes and EUR 15 million of financial charge, free cash flow was positive at approximately EUR 5 million compared with -EUR 9 million in Q3 2025.
Davide Soffietti: Financial charge related mainly to the coupon on 2030 bond and fees on the refinancing. Below free cash flow, the bridge includes EUR 38 million of new Digital Collection portfolio purchases, net of EUR 3 million related to acquisition. Cash flow before dividends and debt repayment was therefore -EUR 27 million. Overall, in a seasonality weak quarter, the group continued to generate positive free cash flow. Digital Collection also continued to generate cash while supporting significant new portfolio investments. Q4 is normally our strong period of cash generation. This seasonality, together with the planned portfolio disposal, supports the deleveraging path that we will discuss in the next page. The net debt on page 14 stood at EUR 882 million at the end of September, with reported net leverage at 3.1 times. Net leverage was nevertheless stable quarter-on-quarter thanks to higher EBITDA. Deleveraging remains a top financial priority.
Davide Soffietti: Assuming the planned disposal of the Digital Collection portfolio had been completed at the end of September for EUR 130 million, the midpoint of the EUR 120 million to EUR 140 million range previously indicated, net debt would have been approximately EUR 760 million and net leverage approximately 2.6 times. This is already within our updated pro forma guidance range of 2.4 times to 2.6 times before any Q4 cash generation. Our liquidity position remains solid, with a current liquidity buffer of EUR 229 million, including EUR 92 million of undrawn revolving credit facilities. The financing transactions completed during the last year have also extended our maturity profile. The new term loan and the bond issued in connection with the acquisition mature in 2031, leaving the group with no material refinancing needs in the near term. The average cost of debt is currently 6%.
Davide Soffietti: The planned portfolio disposal remains the key next step in our deleveraging path. With that, I will hand back to Manuela for the outlook.
Manuela Franchi: Thank you, Davide. Let me conclude on page 15 with our outlook for the remainder of the year. Based on the performance delivered in the first nine months, we are on track to achieve our 2026 EBITDA updated pro forma guidance of EUR 270 million to EUR 290 million. The group generated EUR 185 million of pro forma EBITDA in the first nine months. The bridge on the left shows that the Q4, broadly in line with last year for the NPE and VAS businesses, together with Digital Collection performing within its 2026 quarterly range, would bring us towards the upper end of the guidance.
Manuela Franchi: Importantly, the lower end of the range is protected even under a more conservative scenario in which the NPE and VAS business repeat the 15% decline recorded in the first nine months and Digital Collection perform in line with its weakest quarter of the year, we would still deliver approximately EUR 270 million of EBITDA. Achieving the guidance, therefore, does not require a material acceleration in the NPE and VAS businesses. On leverage, we reiterate our year-end updated pro forma guidance of 2.4x to 2.6x pro forma for the portfolio sale. On the disposal process, we have identified investors and received non-binding commitments. The negotiation phase has been completed, and we are now finalizing the transaction structure with our legal advisors. We continue to target signing by year-end. To conclude, we are in line with the trajectory presented at our Capital Markets Day.
Manuela Franchi: Digital Collection is ahead of our initial expectation. The NPE and VAS businesses return to EBITDA growth, and cost reduction are supporting margins. This concludes our presentation. Thank you for your attention, and we will now be happy to take your questions.
Operator: Thank you. This is the Chorus Call conference operator. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and 1 on their touch-tone telephone. To remove yourself from the question queue, please press star and 2. First question is from Tommaso Nieddu, Kepler.
Tommaso Nieddu: Hello, and thank you a lot for taking my questions. I have a few. The first one is on coeo that delivered a 39% EBITDA margin in Q3, and that when we compare it with Q2 and H1 pro forma, it is quite impressive. My question is, how much of this improvement is structural and reflects operating leverage rather than favorable collection or timing? Is this 39% a sustainable margin level going forward? The second question is still on coeo and looking at cash flow generation. It seems you have been quite active and faster on collections on coeo compared with the previous quarter. Can you comment on that as well? The very last one, you indicate that the negotiation has been completed and transaction structure is being finalized. What are the remaining conditions to close before year-end?
Tommaso Nieddu: Also if you can confirm whether the expected cash proceeds remain in the EUR 120 million to EUR 140 million. I see, but I guess with, I see on the presentation, you put EUR 130 million, but I guess with coeo overperforming, that could lean on the high end of this range. Thank you.
Manuela Franchi: Good morning, Tommaso Nieddu. The coeo growth in EBITDA margin, there are no one-off elements in this growth. This is in line with the trajectory we had indicated in the Capital Markets Day, where the final EBITDA margin for the Digital Collection business was going to end just below 50% at the end of 2029. It is the result of the automation that this business is inherent in itself. The fact that with the improved and growing number of files, there are only limited additions to the HR costs, but all is handled for the vast majority automatically. It is a structural change to the EBITDA margin and drives to the levels we have indicated. In terms of cash flow, this is also consistent with what we had said during the Capital Markets Day.
Manuela Franchi: The fact that the main client has delivered milder growth, still growing, but with better quality, this is because the underwriting strategy has been more conservative, and this has resulted in better files delivered to us in terms of cash associated to this file. We had also mentioned a statistic in the Capital Markets Day that the collection rate had gone up H1 from H1 from around 65% to above 70%, and this is reflected in the collection rate as well. In terms of portfolio sale, what we are finalizing is just the debt structure of the portfolio. We have the investor, we have the debt provider, and we confirm the year-end guidance. We have indicated EUR 130 million, which is just the middle point of EUR 120 million and EUR 140 million as an illustrative example.
Tommaso Nieddu: Okay, thank you.
Operator: Next question is from Antonio Gianfrancesco, Intermonte.
Antonio Gianfrancesco: Yeah, good morning. Congratulations for the results, and thank you for taking my question. The first one is on the legacy NPE and VAS perimeter, because the EBITDA returned to 5% growth inter-quarter, but this mainly thanks to cost decrease. I am trying to understand how much of this cost reduction should we consider structural and how much additional cost savings are still to come over the next few quarters. My second question is on the integration between Digital Collection and the traditional servicing platform, because you had highlighted that coeo's new launched NPE unit in Germany already generated EUR 1.5 million of revenue in this quarter, if I am not wrong, while you are also bringing Digital Collection capabilities into doValue's existing market.
Antonio Gianfrancesco: I was wondering how much of this cross-selling between the two platforms is actually already embedded in the 2029 plan, and how much we should consider as sort of upside. Thank you.
Manuela Franchi: Thanks, Antonio, for your question. On the legacy, the improvement is true. It is also related to the cost reduction. There are two elements to this cost reduction. One component is related to the accrual of the bonuses, and as you know, we always highlighted this area as an area of flexibility we had in case the performance were not in line with the budget. But two-thirds is structurally, it is a reduction in number of FTE and reduction in the operating costs. This will continue with the program we have identified on the NPE side of higher agentification and automation of the processes. This will deliver additional exits in 2027, 2028, with that process of additional reduction of cost that will stabilize the business going forward.
Manuela Franchi: In terms of the positive results of the NPE division, obviously this is driven by the growth of the side of NPE in the German market. So, it confirms that our bet on this opportunity was positive. The enlargement of the business of coeo in the region in Southern Europe has already started, so we are active already operating on the new clients, so it is not just a wishful plan. In terms of deploying the AI capabilities to our traditional operative model, we think that only some can be applied, because the business are quite different. So the project of automation we have on the NPE side uses only some of the characteristic of coeo. Some others are specific to these asset classes, not that coeo model can be replied.
Manuela Franchi: On the other hand, coeo will help us to develop new business opportunities in Southern Europe, which are part of the Digital Collection business growth we have in the 2029 plan, like the work with utilities, telecoms, and also consumer finance, small tickets in general, which will be managed directly with the coeo model and not through what we call reimagination of the NPE operating model. So, there are areas of overlap in the operating model where we will benefit from coeo, and areas where the innovation from the IT standpoint will follow separate paths, but still in delivering the efficiencies. As we know, and we try to explain, these are businesses that have different characteristic bottom-up, so certain features can be replicated, but some others not. It would be superficial to assume that everything will finally fold in the same.
Antonio Gianfrancesco: Okay, very clear. Thank you.
Operator: Next question is from Simonetta Chiriotti, Mediobanca.
Simonetta Chiriotti: Hello, good morning. One question on free cash flow generation. Looking at the press release, operating cash flow was EUR 40 million in the nine months versus EUR 32 million in the H1, implying EUR 8 million of cash generation in Q3 and EUR -26 million of free cash flow in the quarter. Including coeo collection, free cash flow in the period was positive by EUR 5 million. My question is, what should we expect following the disposal of coeo portfolio? Put differently, is it fair to assume that the underlying business would have generated approximately EUR -26 million of free cash flow in Q3 had the portfolio not been within the perimeter? Thank you.
Davide Soffietti: Hi, Simonetta. Just to clarify, no, we have included the collection because the collection, what we receive from the portfolio we buy, the portfolio we purchase are in the balance, as a value, as investment. We also collect the residual amount. Going forward, as we anticipated during our Capital Markets Day, we figured out these two elements will disappear because we not own anymore the portfolio, so the collection will be in the benefit of the investor. We only will get the fees out of those portfolios. The negative impact of the continuous growth of the portfolio is the fact that we guided the market during Capital Markets Day would be roughly EUR 45 million of cash out related to the transfer of this portfolio, because coeo will invest helping the growth of this portfolio to get back the service increase.
Davide Soffietti: From 2027 onward, assuming that we are going to sell the portfolio at the end of the year, we will have only this cash out of EUR 45 million average year by year.
Simonetta Chiriotti: Yeah. On this quarter, if we go back to page 13 of the presentation, could you just elaborate a bit more on the other assets and liabilities? It is EUR 17 million linked to transactions, EUR 7 million of VAT payments. Is it correct? There is another roughly EUR 6 million. What do you expect on these items? I have not understood well when you explain. Is there something that will be recovered by year end? Thank you.
Davide Soffietti: Yeah. On the VAT increase, the EUR 7 million is we are accumulating this credit, so that will be recovered for sure for tax authority, but will not be recovered by the end of the year because we need time to get it back, so will come during 2027. The other amount are other temporary absorption, mainly correlated to the working capital dynamics in other countries. Then we have a small effect coming from the financial position because we are accruing more interest, including the TFR. All in all, what we have said that we have elements that are non-recurring, like the transaction cost, the EUR 16, EUR 17 million that was already included in our guidance full year would be EUR 22 million. The VAT payments is something that is only temporary, so we will recover in the next years.
Davide Soffietti: That is the working capital dynamics, so that also that one, we have a guidance to have a positive contribution, or as I was mentioned, we have collected EUR 12 million in the 1st of October. That amount by the end of the year will be positive, thanks to the positive contribution on that working capital.
Simonetta Chiriotti: Thank you.
Operator: Next question is from Davide Giuliano, Equita.
Davide Giuliano: Hi, good morning and thank you for taking my question. The first one is on the Italian region. Can you give us more color on the underlying trends for Italy's year-on-year improvement compared to H1 2026 dynamics? Are there any elements that have partly mitigated the unfavorable seasonality? The second one on Italy and Hellenic Region for Q4, in particular, if you can comment on the trend that you expect for these two regions in Q4. The last one, if you can comment if there are any updates on the servicing of tax credits. Thank you.
Manuela Franchi: Good morning, Davide. On the Italian region, if you recall, we had EUR 27 million of EBITDA in H1. So the Q3, despite being usually a very weak quarter, given that one month the courts are closed, which is the month of August, has been able to deliver around EUR 13 million of EBITDA, which was similar to the Q2, which is a full month of activity. This is driven by three elements. One, a pickup on the collection, especially in the month of September, due to an active management of our portfolio. Second, a significant growth of value-added services and on the first cluster, so especially driven by the growth in collection from the UTP element. Second, as I said, the value-added services which are boosting very good profitability and growth above our expectation, especially on the master servicing side, where we are gaining market share.
Manuela Franchi: Third, clearly a lot of attention on the cost side to be able to offset the backlog of lower collection on the first part of the year. So, the trajectory for year-end for this business is in around, as we got for EUR 60 to EUR 70 million, depending on the final collection at year-end. So the variability is only on the collection side. On the Greek front, the performance on the core business, without the safety, is progressing very well. They are ahead of expectations. On the collection side, they continue to grow, and this is the result of the portfolio that have been onboarded last year that are now bringing the results. On the cost side, they are performing better than it was in the budget.
Manuela Franchi: The only variability is around the safety that, as you know, have been concentrated much more than in the past in the last quarter, given the Katseli Law event in H1 where the market was waiting, so didn't guide to any sales from the investor side in that period of time. This is the only element where we are trying to accelerate all the transaction by year-end, but there is always that uncertainty. Also in Greece, you might have seen the recent decision of the parliament, it was last week, regarding a set of new rules for servicers. Clearly, this will have an operating burden, which doesn't mean an operating cost, but more activity there to be able to satisfy all the requirements, which are mostly related to information to borrowers on their position.
Manuela Franchi: The flip side of that will be fines if you are not following all the requirements of the new law. This is the only positive, the only news that happened in this period of time. Regarding the servicing of tax credits, as we have said in the Capital Markets Day, they are a function of adding a specific license. We are monitoring now small opportunities to acquire that license, because it requires a track record of five years that obviously in that space we don't have. The plan is for AMCO, through the state-owned companies, is to issue an RFP in Q1 for the allocation of first tranche of tax credit that will move to AMCO by the end of this year.
Davide Giuliano: Thank you.
Operator: As a reminder, if you wish to register for a question, please press star and one on your telephone. Next question is from Davide Rimini, Intesa Sanpaolo.
Davide Rimini: Good morning, and thank you for the presentation and for taking my questions. I have two follow-up questions. The first one is on cost performance. Q3 pointed at a minimum acceleration in efficiency with personal administrative costs down double digit year-over-year on a like-for-like basis. I was wondering whether these savings are attributable already to the initial implementation of the agentification program that you mentioned at the Capital Markets Day, and whether the Q3 run rate provide comfort to the EUR 15 million, EUR 20 million of cost reduction targeted for this year, or potentially could be exceeded this target.
Davide Rimini: The second follow-up question is regarding the leverage target pro forma that you have confirmed, and I was wondering whether, given 2.6 at the end of September, considering the back book sale, and considering the highlighted seasonality that pointed to a stronger free cash flow generation in Q4, I was wondering, is there any element that we should have in mind while targeting still 2.4, 2.6, given that the end of September you are already pro forma at 2.6? Thank you.
Manuela Franchi: Thank you, Davide, for your question. On the cost side, clearly we did not wait to the Capital Markets Day to start our efficiency program. We had started earlier on, given that we had been working on the business plan for at least six months. You are correct that we are already seeing the effects of the agentification program, especially on the Greek side, which started earlier on, and also on the Italian front, more on the last quarter. Clearly on the cost side, we will make better than the original guidance for this year. This is an area where we focused early on, because while the market tailwind, now we can do as much as possible, but we are exposed to the macro conditions.
Manuela Franchi: On the cost side, these are levers that we control, and it was important to act upon them as soon as possible. On the leverage, we have usually a Q4 that has a very strong contribution, so this should sustain our target we have given that the pro forma is already at 2.6 times. Davide can provide additional details for the year-end component.
Davide Soffietti: No, just the main contribution, as was mentioned before, it will come from ordinary cash flow of the doValue business or positive working capital dynamics, recovery on the temporary consumption of cash flow in Q. So, the range comes mainly because we need to recover this amount, we are on track, and then which vary according to the range we gave on the EBITDA, between EUR 270 million, EUR 290 million, also to deliver fully on the cash flow and on the portfolio sale, we will have a range depending on the EBITDA level. So, this is why the range is still reasonable, and we think will be respected.
Operator: For any further questions, please press star and 1 on your telephone. Mr. Della Seta, gentlemen, there are no more questions registered at this time.
Daniele Della Seta: Thank you, everybody, for joining. Have a good day.
Operator: Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.
