Zumtobel Group AG

Good morning ladies and gentlemen and welcome to Zumtobel Group's conference call on our first nine months and third quarter results for our 2025-26 financial year. With me on the call today are Alfred Felder our CEO and Thomas Errath our CFO. Alfred will walk you through the highlights of the quarter while Thomas will discuss the financial performance. After the presentation both gentlemen will be available to answer your questions. In case you have not a copy of the report and the presentation, you may find both documents for download on our webpage. After the call, a playback of this conference call will be available on our webpage as well. And with this, I hand over to Alfred.

Thank you, Eric. Good morning and welcome ladies and gentlemen. Thank you for joining us today for our Q3 call. The third quarter was once again a challenging period for our business as market condition and the broader economic environment remained difficult, impacted by the geopolitical tensions, particularly now since last week, also the latest developments in the Middle East. However, in Europe, we begin to see signs of demand in new construction. but the recovery remains rather modest. The market climate continues to be shaped by the global uncertainty, and therefore still we are having, as we discussed also last time, longer decision-making cycles and reduced investment appetite. Before we move into the details of the financial side, as always, I would like to give you an update on a couple of Key projects, what we did in the last quarter, starting from the left side, that's the European Patent Office in Munich, where we also completed next to the first phase, the second phase in close collaboration with our strong network and lighting designers. Below that, an example of the office here in Barcelona, where we once again have demonstrated our expertise in creating high quality and contemporary work environments. So if you look at the right side, then you see here the Festhalle in Bern, Switzerland. That's the new Festhalle, a venue that has been created for the BAM Expo site that moves people culturally, economically and socially. And here Zumto will deliver the complete lighting solutions as the overall lighting partner for Bern, covering all areas from the concert hall and the foyer to the conference rooms. And data center remains a key growth driver for us. And you see it here on the example of Amazon, where we did again a tailor made facility for Amazon with our tailor made product. And finally, to conclude an example of a store here, the Levi's store in Paris, this project. Again, demonstrates the competence in our retail, creating really this brand enhancing retail environments that combines visual comfort, efficiency and architectural integration. Before we go into the numbers, just as we have passed now the Olympics in Italy, I would like to highlight what we did over there, because there's really something where technology, sustainability and the brand comes together. And I can proudly say out of the seven events or the seven places and venues, we as the Zumtobel Group have been involved in four. You see it here on the picture. One is the Pradazzo Ski Jumping Stadium. The other one is the Sliding Center in Cortina. And then in South Tirol, in Südtirol, in Anterselbe and Antholz, the arena for the biathlon. And then in the fourth one, the arena of Santa Giulia. For the Zumtobel Group, These games are more than a project. They are the opportunity to showcase how advanced lighting can enhance performance and improve the spectator and broadcast experience. and set new benchmarks in efficiency and sustainability. And the strategic impact extends well beyond the event itself. Visibility on such a global stage strength us in the brand positioning and open store for new projects around the globe in the years to come. On slide five now, let me give you an overview before Thomas goes into the details on the financial performance of the first nine months. A period that was characterized by, as I said already, the uncertainty in the economy and a weak market environment across the board. And you see this reflected also in the performance. The revenue for the group declined by 6.4% to $828 million to $775 million. On the segment level, the picture is as follows. Lighting segment generated 618 million euros, while the revenue of the components segment remains weak at the amount 200 million euros. The adjusted EBIT at 32.2 million euros, which corresponds now to an EBIT margin of 4.2%. The figures clearly show that we are still facing the variety of challenges, which makes it particularly important to focus on the resilience and sustainability within the Zoom Double Group. And that, of course, also includes what we reported, the ongoing review of our cost structures. This picture you know, we are continuing to work on these three pillars, the lean organization, the streamlined processes, the shared service center for the next year budget, We have also a quite substantial increase of function in the shared service, you know, that are both in Porto, in Portugal, and also in Serbia in two locations, Belgrade and in Nice. And we do target to save 40 to 50 million by 28, 29, with a portion coming in within this fiscal year and then basically the next two years to come. But the issue is that we are now building up the structure in the shared service center before we can transfer all this. But I also wanted to emphasize this is not just a cost cutting issue. exercises about optimization and improving of our separate in the future to get leaner, more customer focused. So in our overall commercial organization, we are convinced, ladies and gentlemen, that this measures, but we have introduced will strengthen our company in the future, especially hopefully within the next Yeah, quotas, the better market environment so that we are positioned here for the future. And with that, I would like to hand over to Thomas, who will then go through the Q3 results in detail.

Thank you, Alfred. Good morning, ladies and gentlemen. Let me start with the lighting segment. Q3 revenues in the lighting segment amounted to 190 million euros and were 3% below the previous year. Germany, Austria, France and UK recorded lower volumes coupled with price pressure. However, positive volume contributions were recorded in the Southern and Eastern Europe region, highlighted by Italy and Hungary, along with positive growth in Switzerland. Adjusted EBIT in the lighting segment increased from 1.9 million euros to 7.2 million euros. Our adjusted EBIT margin increased to 3.8%. Lower material costs and the decline in personal expenses more than offset the decline in revenues. Please keep in mind for comparative purposes that this year's research subsidy of 1.7 million euros was recorded in Q2 whereas last year this was recorded in Q3. Let me move to the component segment. Revenues in the component segment declined by 10.4% to 62 million euros in the third quarter. The difficult economic and geopolitical environment led to declining sales and also increasing pressure on prices. Adjusted EBIT in the component segment totaled minus 2 million euros. The adjusted EBIT margin stood at minus 3.2%. Lower material and transportation costs as well as lower personal expenses were unable to offset the decline in revenues. Again, please keep in mind for comparative purposes that this year's research subsidy of 1.8 million euros was recorded in Q2, whereas last year's Q3 figures included this research subsidy of the same amount. Slide 9 shows the Q3 result for the group. Revenues in the third quarter declined by 5.2% to 237.4 million euros, mainly as a result of declining volumes and price pressure. Adjusted EBIT stood at 0.6 million euros compared with minus 0.2 million euros in the third quarter last year. Adjusted EBIT amounted to 0.3%. Overall, lower material costs, lower personal expenses more than offset the negative impact from declining volumes. As already mentioned, for the segments, this year's research subsidy of 3.5 million euros at group level was recorded in Q2, whereas last year's figures included the research subsidy in Q3. Let's move to the EBIT bridge. Looking at the adjusted EBIT bridge, we start with the prior year adjusted EBIT of 41 million euros. The negative revenue impact totaled 38.5 million euros with the decline primarily caused by volume reductions, which is about two thirds and to a lesser extent by price pressure around about one third. Looking at our COGS, lower material costs and lower personal expenses had positive impact of 22.3 million euros. SG&A and research costs made a positive contribution to results, mainly due to lower personal expenses. As a result, adjusted EBIT decreased to 32.2 million euros. Slide 11 provides you with the information on our income statement. As I mentioned before, our adjusted EBIT stood at 32.2 million euros. Special effects were negative at 12.7 million euros. They include restructuring costs, mainly in connection with the closure of our US production site and our efficiency program. In addition, the special effects recognized in component segment reported in the second quarter include the impairment of goodwill, which was about 2 million euros impairment losses of capitalized development projects, 2.7 million euros. And on the other side, an investment premium of positive 1.4 million in Portugal. After the deduction of these special effects, our EBIT totaled 19.5 million euros. Our financial results amounted to minus 9.5 million euros and net financing costs amounted to minus 6.9 million euros. Other financial income and expenses totaled minus 2.6 million euros and included the interest expense for pension obligations, FX and hedging valuation. After the reduction of income taxes, our net profit for the first nine months amounted to 9 million euros as a consequence earning per shares equaled 22 euro cents let's now move to the next slide the cash flow statement Cash flow from operating results fell year on year from 69.2 million euros to 64.6 million euros, mainly due to decline in sales. The change in other operating items amounted to minus 36.4 million euros and resulted mainly from lower provisions for variable salary components and restructuring. Cash flow from operating activities stood at 36.8 million euros in the first nine months versus 48.8 million euros last year. Cash flow from investing activities amounted to minus 31.4 million euros in the reporting period. In addition to investments in property, plant and equipment, capitalized development costs of 11.5 million euros are also included. And as a result, free cash flow equaled 5.4 million euros versus 15.6 million euros last year. Cash flow from financing activities amounted to 10 million euros for the first nine months versus minus 36.3 million euros last year. The change compared to the prior year is primarily related to two factors. First, the increased utilization of the syndicated loan agreement and second, the loan from the European Investment Bank. A reduced dividend distribution also contributed to this effect. Let me finish with slide 13 and some comments on our balance sheet. The balance sheet structure remains stable. The equity ratio increased to 43.4%. Net debt rose in comparison with the year-end close to 131 million euros. Our debt coverage ratio is at 1.59. And with this, I hand back to Alfred.