Fincantieri S.p.A.

Good afternoon. This is the conference operator. Welcome and thank you for joining the Fincantieri First Health 2026 Results Conference Call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator requested star and zero on the telephone. At this time, I would like to turn the conference over to Mr. Folgiero, Chief Executive Officer and Managing Director. Please, go ahead, sir.

Hello, good afternoon. Welcome to Fincantieri First Out 2026 Results Conference Call. We are pleased to report another outstanding set of results. Marked by strong margin expansion, record net profit and continued leveraging driven by solid cash generation. These achievements further demonstrate the successful execution of our strategy and the group's ability to convert strong commercial momentum into sustainable and profitable growth. We deliver the further step change in profitability with EBITDA growing 12.5% and margin reaching 7.6%. Margin expansion was mainly driven by favorable pricing dynamics and efficiency measures in cruise, higher margin on defense programs currently under construction, as well as the increasing contribution of underwater. Net profit consequently rose to a record 102 million euro, almost tripling from first half of 2025 and reaching a level close to the all-time high of 117 million euro achieved in full year 2025. Commercial performance remains particularly strong. BAF secured the largest contract in its history with the Royal Saudi Navy Faults. BAF acquired a record order in Inkfish with Inkfish for a next-generation deep-sea research basin. while new major cruise contracts extended visibility on deliveries through 2039. In the France, just a few days ago, the Portuguese and Italian governments announced an agreement for the acquisition of three French Evo frigates. Our growth strategy continues to be supported by strong financial discipline with leverage ratio decreasing to one time. Significantly improving compared to the full year 2025, thanks to cash generation over the period. Looking ahead, the progress achieved in the first half fully supports the confirmation of our 2026 guidance across all targets. Finally, we are very proud about the strategic acquisition of NextGeo Solutions, WSense, Browstech, and DevCom announced earlier this month. Together, these transactions mark a new phase in the group's evolution and accelerate the creation of an international, fully integrated underwater champion, as I will explain in a few minutes. Let's now turn to page 4. Our commercial performance remains strong. Order intake reached €6.1 billion. in the first half of the year with a book-to-bill ratio at 1.3 times. Total backlog increased 17% year-to-date, while the backlog reached 43 billion euro. Total backlog and backlog guarantee approximately 8 and 4.7 years of work when compared with 2025 revenue. Please note that order intake does not yet include a number of major contracts signed during the first six months, particularly in cruise and underwater, which are currently reflected in the soft backlog as they remain subject to financing and other customary conditions. Including this agreement, we already exceeded the approximately €11 billion order intake presented with our capital markets day February. and, as I discussed shortly, additional opportunities continue to progress across all our businesses. Let's now move to page 5. In the first six months of 2026, we delivered 11 units from eight different shipyards across the group, demonstrating the strength of our industrial execution capabilities. At the same time, our order book continues to provide exceptional long-term visibility, with 92 units currently in portfolio and deliveries scheduled up to 2036, taking into account the cruise orders signed with MCLH and Princess Cruises in recent months, which are not yet effective. Delivery visibility extends through 2039. Let's now move to page 6, and let me briefly walk you through some of the most significant commercial achievements announced during the first half of the year and in recent weeks. In cruise, we secure orders for 9 vessels for Norwegian Cruise Line, Viking Cruises, Princess Cruises and 40 In defense, we continue to reinforce our positioning across strategic programs and geographies. Key developments include the initial contract under the U.S. Navy's LSM program, covering the first four vessels and paving the way for a future award of the construction contract, as well as the full combat upgrade of the Italian Navy's PPA units and the industrial agreements with Albania, Indonesia, and Croatia, further expanding our international footprint. More recently, the Portuguese and Italian governments announced the agreement for the acquisition of three Fremivo Frigues for the Portuguese Navy. In offshore and specialized vessels, we continue to demonstrate the benefits of our diversification strategy beyond the energy offshore market. Alongside the largest single vessel order in VATS history, secured with ink fish, We signed additional contracts in the fisheries, maritime infrastructure and specialized vessel segments, including an advanced third trawler for Roslund Rift and two multi-mission buoy and lighthouse maintenance vessels for Trinity House. Finally, underwater, PAS secured the largest contract in its history with the Royal Saudi Naval Force and Only a few days ago, we signed a contract amendment with OCAR for approximately 317 million euro covering logistic support initiative and vast countermeasured systems for the U-212 NFS Summary Program. Furthermore, we expect more underwater opportunities coming from the new acquisition announced. Moving to page 7. The positive tailwinds and solid performance delivered give us full confidence in our 2026 guidance trajectory. We confirm the targets for the end of the year. Revenue in the range of 9.3 to 9.4 billion euro. EBITDA in the range of 700 to 710 million euro, with an EBITDA margin confirmed at approximately 7.5%. Net profit in the range of 140 to 180 million euro. And finally, net debt adjusted to EBITDA ratio at approximately two times, which equals to 1.3 times, including the capital increase completed in February 2026. Let's turn to page eight for more color on the recent M&A announcement in the underwater. On July 2026, we announced the acquisition of NexGeo Solutions, WSense, DEFCON, and Grand Tech, a decisive step in the creation of a fully integrated international underwater champion. Thanks to these acquisitions, the group establishes the first vertical integrated underwater operator, capable of delivering end-to-end solutions across the entire value chain, Moving to page 10. Let me remind you that these acquisitions are largely financed through the ADV capital increase successfully completed in February 2026. The capital increase was approved by shareholders in 2024 and specifically conceived to support the group's inorganic growth strategy while preserving financial discipline. We successfully executed the transaction during a favorable market window before the escalating geopolitical tensions affected market conditions, and demand proved exceptionally strong, with the offering multiple times oversubscribed. Today, shareholders can clearly see the rationale behind that capital increase, as the proceeds are being fully deployed to create industrial value through the expansion of our underwater segment. Importantly, with the ABV proceeds only being supplemented by other available resources, the acquisitions have no impact on our 2026 leverage guidance, while strengthening the leveraging trajectory set out in 2028 and 2030 business plan targets. Let's turn to page 11. The first wave of acquisitions with Remazel & Bass laid a solid foundation for the development of the underwater segment, expanding Cinquantieri's presence across defense tool use and commercial applications, while delivering significant growth in revenue, profitability and cash generation. The second wave expands significantly the group's presence and capabilities across specialized services in marine survey, geoscience, and marine construction support, proprietary unmanned underwater and surface-grown technologies, and wireless communication systems for the internet of underwater tanks. By bringing together these eight market-leading companies, we are creating Europe's first fully integrated underwater ecosystem. a platform that can operate, connect, protect and govern the underwater domain by combining services, autonomous vehicles, sensors, communications, defense systems and strategic platforms into a single industrial capability. Moving to page 12, you can see the comprehensive portfolio of underwater solutions now brought together within our underwater segment. What makes this platform unique is not only the breadth of technologies offered, but also their ability to operate within a single integrated ecosystem, offering a one-stop-shop proposition. By combining services, autonomous systems, sensors, communication technologies and underwater and surface platforms, we can increasingly act as a front-end service provider, orchestrating integrated end-to-end solutions tailored to our customers' operational needs. This enables us to evolve into a prime contractor in the underwater domain. Moving to page 13, from a financial standpoint, the underwater segment has already delivered impressive results, strongly supported by the first wave of acquisitions, with Bas and Remazel providing outstanding contributions in terms of revenues and EBITDA. Building on the positive boost of the first wave, the second wave of acquisitions further enhances The segments scale, profitability and contribution to the group's consolidated results and enables us to anticipate by four years the original targets for the underwater segments for 2030. On a pro forma basis, revenue is expected to approximately 1.1 billion euro in 2026, increasing to 1.8 billion euro in 2030. EBITDA is expected at approximately €220 million in 2026, growing to €420 million in 2030. The EBITDA margin is expected to further increase from the current high double-digit marginality of the underwater segment, reaching 19.2% in 2026 and increasing up to 23% in 2030. The underwater segment is also highly profitable at group level, delivering on a pro forma basis an additional 60 million of net profit in 2026 and 130 million euro in 2030. With this, I will end the call over to Giuseppe for more color on financials. Please, Giuseppe.

Thank you, Pierroberto, and we move on to page 15 in S.A. that spent 6.1 billion euros in the first half of this year. These 6.1 billion euros mainly come from orders signed previously, but that became effective during the first six months of the year. We must know that on top of that, during the first month of this year, we signed orders in excess of roughly 12 billion euros Those orders, of course, are not effective, but they will become effective in the next 6 to 12 months, and this is a testament of the very vibrant commercial activity in our markets. And if we move to page 16, this commercial activity reflects very well on the total backlog, which at least almost 74 billion euros Both soft backlog and backlog increased. Backload is 43 billion euros, notwithstanding, of course, the activity and the revenues we booked in the first six months, and a soft backlog of almost 31 billion euros. We delivered 11 units this year from eight different shipyards, and we moved to phase 17, where we discussed revenues. Revenues reached and Alessandra Battaglia. In the second quarter of this year, of course, this is due to the progress of production activities that are related to the existing backlog, and this acceleration offsets the unfavorable comparison with the first half of last year, where we had the one-off revenue recorded for the two vessels for the Indonesian Navy. Revenue grew in the cruise business by almost 15%, driven by backlog execution and some progress on ships that were acquired at better prices compared to the past. Offshore revenues grew by 22.4%, compared to the same period of last year. Underwater posted a growth of almost 30% and also equipment system and infrastructure recorded revenues up by 16.2% at 720 million, mainly driven by mechatronics and the infrastructure business. On page 18, significant increase in EBDA. We reached 7.6% EBDA margin. Last year we reported 6.8 and this is a very strong increase with sheet building that improved materially to 7.5% supported both by favorable pricing dynamics and efficiency initiatives that we keep undertaking throughout the course of the year and as part of our and, of course, please note that this margin growth comes notwithstanding the revenues, the decrease in revenues in defense. So it's quite remarkable, let me say. Offshore EBITDA rose to 40 million euros, confirming the growth trajectory of the business, with the marginality broadly in line with the trend of recent years. We had a substantial growth of almost 30%, and the margin of 17%. And this confirms that this segment comes at a premium with respect to the other segment, the other business segments. Equipment systems and infrastructure segment delivered a strong contribution to the group's profitability with EBDA rising by 9.5% and EBDA margin reaching 6.5%. This is all across the three segments. On page 19, of course, significant growth in net profit, three times net profit levels on the first half of last year, and this is in track with the guidance, on track with the guidance that we gave for 2026. Net profit growth was supported by very strong operational performance that we saw on the previous pages, 102 million euros, and almost reaching the level of the full year 2025. I remind that we closed at 117 million euros in 2025. Again, strong operational results coupled with the reduction of the cost of debt and this is structural and ongoing and will further improve in the quarters to come. And of course this is also linked to the disposal of non-strategic joint ventures, non-strategic states in joint ventures that we had in China and a lower impact and this is structural again, a lower impact of asbestos related litigation costs. adjusted net result excluding those extraordinary non-recurring items was positive for 130 million euros compared to 48 million in the first half of last year. On page 20, net debt, adjusted net debt strongly improved compared to the end of 2025, reaching 750 million euros. Of course, this value includes the effect and I just know that would be 1.2 billion euros roughly and again this is as well supported by solid cash flow generation. Leverage ratio improved to one time compared to 1.9 EBITDA compared to as of last year, as of end of the year 2025 and this reads 1.7 excluding the effect of the capital increase. that was in capital negative at €723,000, slightly improving compared to end of last year, and this is thanks to the increase in work in progress and somehow higher trade receivables, trade payables, sorry. Now I leave the word back to Pierroberto for his concluding remarks.

Thank you, Giuseppe. Let me now summarize our takeaways on page 22. We delivered a strong performance in the first half of 2026, further reinforcing confidence in 2026 targets and beyond, which, as you may remember, we had raised in our Q1 2026 results. The structural improvement in profitability continues, with EBITDA margin reaching 7.6% and net profit rising to a record 102 million and the EURO, supported by margin expansion in shipbuilding and increasing contribution of underwater. At the same time, our growth is highly sustainable with solid cash generation driving continuing the leveraging. Commercial momentum remains strong with an impressive total backlog, solid order intake and contract signed year-to-date already reaching the full-year order intake target. while providing visibility through 2039. And more is to come, as we expect new major defense orders to be signed in the coming weeks. Finally, the acquisitions announced in July marked a decisive step in the evolution of our underwater segment, accelerating the creation of an integrated international champion, bringing together eight market-leading assets, providing end-to-end solutions in defense to unused and commercial sectors. These transactions are largely financed through the capital increase completed in February 2026, thus preserving the Group's financial discipline. Then we are now open to take your questions.

Excuse me, this is the CarScore conference operator. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and 1 for the touch-tone test. To remove yourself from the question queue, please press star and 2. We kindly ask to use handsets when asking questions. Anyone who has a question may press star and 1 at this time. Press star and 1. The first question is from

Antonio Gianfrancesco of Intermonte, Fisker Hetzer Hi, good afternoon and congratulations for a very strong release. Two questions from my side. The first one is on the SAVE program because I wanted to ask about this program also given the recent comments from the Italian government on recapting almost, I think, 15 billion euros under this framework. I was wondering whether this could actually accelerate the formalization of specific Navy programs such as DDX already in second half of this year. And second question is on the guidance, because you are already at 7.6 FBDA margin in the first half of this year and the process is already quite advanced versus the full year start. So I was wondering what is the main prudence embedded in the second half of the year and what you would need to see to consider another guidance revision in coming months. Thank you.

So, first question on the SAFE, on the second question I will leave the floor to Giuseppe. So, SAFE, I think that the trajectory of Italian government expenditure on the fence is independent from the SAFE adoption. So, I strongly believe that you know it is already expected for the 2026 and in particular 2027 and again safe as to do on the way you want to finance this if you want to have access to a measure that is financially convenient in term of cost of money and in term of maturity or not So my position is that the trajectory is there and will be there. With specific respect to the orders we are targeting for 2026, which are the ones that we have been somehow pursuing and we have more than once shared with the market, Those orders are not necessarily linked with the government decision to take or not this financial instrument. So, it is important, it is very important, there is a lot of debate, but at the end of the day, it has not changed very much what is happening for us in 2026, and for the years to come, the increase in expenditure is clear, expected, confirmed by the government in several occasions on a national, I would say, scene and in the international scene. Giuseppe, would you be that? Why we are so prudent?

No, I mean, yes, the results in the first quarter, in the first half were very good. They said before You must appreciate the level and the way we reach those results. Again, if the revenue growth improves and still waiting for the order acquisition in the defense business. So defense still has to kick in and contribute to further increases in marginality. And that is why those results are even more remarkable. in my opinion. As with the possible update of the guidance, stay tuned, but at the moment the guidance is what we said and we confirmed is roughly 7, 710 million euros in MTA with a margin of 7.5% period.

Let me also add that, you know, in a business like ours, SMS or reporter are like photograms. S.p.A., Pierroberto Folgiero, Giuseppe Dado, Felice Bonavolontà, Alessandra Battaglia Very clear. Thank you.

The next question is from Emanuele Gallazzi of Equita. Please go ahead, sir.

Good afternoon, everybody. I think there are two questions from my side. The first one is still on the naval business. We have seen the agreements in Croatia and Albania. Can you comment a little bit more on this opportunity and the potential timeline? And in addition, if you can also provide an update on on the commercial opportunity with the U.S. Navy. The second one is on the cruise, because it seems to me that, looking at your results, the momentum is building in the cruise sector, with a very solid performance in the second quarter, specifically in terms of profitability. Can you discuss a little bit more on the trend you see on the cruise sector and, generally speaking, on the mood of your client? Thank you.

Very good, very good. Again, Croatia, please consider that when you have to secure a target of orders, you participate to number of opportunities that are higher vis-à-vis your ultimate target. So I don't want to go again in the issue of Norway, in the issue of Poland, as if every tender we participate, then the market is waiting for us to take 100% hit rate, and therefore, if then we are not 100% hit rate, we have a problem in the commercial pipeline. So please let me be a little bit, I would say, boring in saying that in the business of securing large orders, if you want to secure X orders, We have to bid for Epsilon orders. And the difference between X and Epsilon is not an issue, is not a defeat, is not a bad news, is the way you manage businesses. So having said that, Croatia is a huge opportunity. It's the Adriatic Sea. You know how much we are strong in the Adriatic Sea. It goes without saying. It is the, I would say, extended Giulia Venezia Giulia Space. We have common roots. We have a lot of similarities. We have already a lot of synergies with that part of the sea, with the other side of the same sea. So there is a lot to do in Croatia. We are addressing that opportunity with a lot of emphasis. But again, don't take me that we are going to have 30 billion order in day because I don't have 30 billion of orders between Mugiano, Riva and Castellammare. So Croatia is a good opportunity. They are building kind of light corvettes and it is something that is going to be mature throughout 2027. Albania is a different story. Albania is an expansion of our construction footprint so we wanted to create in Albania a kind of additional shipyard with the government of Albania building the shipyard and with Fincantieri and local knowledgeable parties managing the shipyard in order to build their smaller vessels serving not only the very, I would say, light Navy ships, but also ships for other kind of constituencies, such as coast guard, or such as police when working at sea, and things like that. So, that is the strategy for that shipyard, which is a market that is growing a lot, which is a market that is made of high number of ships, different from the huge ships that are accustomed to build in our historical shipyards. So, in the Albania expansion there is a lot of strategy, but on top of the strategy there is also the, I would say, simultaneous opportunity to pursue and order from the Albanian Navy, which will be, by the way, channeled to the Albanian Joint Venture. So it's the ideal way to break the ice and to, you know, have this new, I would say, revamped shipyard starting production. and delivering the first ships with the idea of then replicating the same kind of small ships for other navies in other nations. So in Venice, a different story. Your third point on USA, USA is in the process of accelerating its Golden Fleet program. As we have specified several times, We are intrinsic, we are integral part of the U.S. revitalization of shipbuilding. The tangible evidence is the award of the LSM program, which is, again, a numerous one in terms of units, and Fincantieri is are selected and already at work. It is not all about LSM, so the shipyard will be included in the launch of other programs in this orchestration that the U.S. administration is envisaging in order to take advantage of the few experienced shipyards in U.S. Your fourth point on trends with respect to cruise. Cruise is apparently unstoppable in terms of growth. This is driven by the value for money proposition, i.e. the comparison between the cost of an equivalent holiday onshore vis-à-vis offshore. So if you look at what happened to the cost of tickets, cost of hotels, cost of restaurants, cost of accommodations at large, onshore vis-à-vis offshore, you understand why Cluj is so attractive. And if you consider that the addressable market for cruise liners, for cruise operators, is the tourism at large. So their idea is to increase the penetration of cruis over the overall, I would say, basket of holiday spenders, holiday money spenders, I would say. So there is a lot to do, conceptually they can grow a lot, because, you know, they can move from the market made of 40-45 kind of passengers per year, cruisers per years, all the way to the billions of tourists all over the world. So conceptually, the penetration can be higher and higher in this addressable market. Then the second trend in the cruise industry is not only this value for money arbitrage, but also the segmentation. So, in order to better address the market, typically you cut it into slices and you associate with each segment a specific offering. So, this is the second micro-trend. So, in order to convince the incremental tourist to become a cruiser, typically what you do, you segment. and in this respect Fincantieri is a fantastic partner because we can be a workshop shop for the several brands of each big player. So if you have your brand for luxury, your brand for upper premium, premium, contemporaries and basic, we can cover all to all, end to end, all your needs because we have a system of shipyards rather than a shipyard and every shipyard participating to the system can be the best, can fit at the best with the specific size of the ship. So for example, we build in Ancona, super luxurious ship, then we can build in Monfalcone, super large ship, then we can build in and Marghera, medium to big ships or medium ships in Cestri. So basically we can accommodate all the brands. So this is what is happening in the cruise. I think there is a third phenomenon, which is the substitution effect. So the cruise business has been very successful in the last 30 years, but you know you need to substitute your ships as soon as kind of obsolescence is taking place, but also technological substitution and new regulations. So the demand for new cruise ships is not only driven by the increase in the market share, but also is driven by the substitution, because we need to substitute older ships with newer ships, considering the regulation, but also considering the kind of look and feel If you are accustomed to be in a ship that is modern, that is attractive, that is full of entertainment, then you don't want to be on an older one with less of it, and again, with a kind of old generation. So what we are also experiencing is the substitution effect.

Very good. Thank you.

The next question is from Marco Vitale of Mediobanca. Please go ahead, sir.

Good afternoon. Thank you for taking the questions. First one is on naval business with revenues still on declining trajectory in the second quarter. on the constellation class cancellation. How is the underlying business progressing and when should we expect the segment return to growth? Second question is more high level on the underwater. How do you view your positioning in the segment after your deal and also taking into account the evolving competition after the several transactions that have been announced within the segment? Would you still target in part RM&A to strengthen your open order? Are you happy with that at the moment?

Thank you. So, on the defense, unfortunately or fortunately, The answer is very obvious. So you will see revenues after orders. It's difficult to see revenues before orders. I would say it's unlawful. So in order to have revenues, you have to have orders. So we are working in order to have the, I would say, materialization of orders in the very short term. and so I would say you will see the rollout of revenues accordingly. So as you know, we are expecting 5 billion. There are, I would say, very visible signals that these 5 billion are there starting from Portugal and not only from Portugal, the DDX is there, the LSS is there, the Caraship is there, so there are a number of opportunities that were, I would say, here and there, disclosed, and again, once those orders will be there, revenues will be there. So next year, for sure, You will see the acceleration in the revenues as a consequent effect to the acceleration in orders. On your second question, the underwater positioning and evolving competition, our positioning in the underwater is something that we have, that we try to explain very clearly during the dedicated presentation on July 6th. So basically the positioning is to create a platform that is a platform that can cover all the needs with proprietary technologies and at the same time being also able to provide services So to be a kind of prime contractor in the underwater, able to provide kind of underwater as a service. So you don't need to buy drones, you don't need to buy command and control, you don't need to buy telecommunications, you don't need to train your personnel, you don't need to hire people, I can do it for you. Because I am a I'm a service integrator. I'm a player that can do it for you and addressing your needs. So this is unique. There is no one on the market that can offer underwater as a service, ranging from defense to the dual use and to commercial services. This is the, I would say, highest Alessandra Battaglia, Alessandra Battaglia somehow regulated by the national content. So everyone wants drones, but everyone wants to have drones that are, you know, under my full control without black boxes. Without black boxes that can be switched off from FAN. So this is the key. understanding for certain critical technologies. Not for everyone, obviously, not for every technology, but for the key technologies, the competition is not driven by the price, but is driven by the, I would say, freedom of use and full control of these solutions. So this is not a normal business. This is a business that is managing a level of interest that is calling for technological sovereignty. Obviously, you have to couple technological sovereignty with competitiveness because nobody wants to throw money out of the window, but it's not a matter of I will buy something from far, I would like to buy something from near. This is what we are experiencing. And Italy is a very expert and knowledgeable place, having expert and knowledgeable industrial base that can validate technology and then can, you know, sell it to other countries that are, you know, compatible. Alessandra Battaglia, Alessandra Battaglia that the M&A waves we have executed are driven by a make-or-buy strategy whereby we had very clear which were the technologies that we wanted to address, that we wanted to cover, and we were very explicit on which are the source of distinctiveness. in this portfolio of technologies. We believe that our maker by strategy and the relevant M&A campaigns are done, are executed. Obviously, we remain opportunistically ready to pursue any other selective opportunities in case we Thank you.

The next question is from Tommaso Castello of Jervis. Please go ahead.

Yes, good afternoon and thanks for taking the time to answer to my questions. I have three questions. The first is a follow-up on shipbuilding and it is around the profitability, whether you expect marginality to keep at the same level throughout the remainder of the year despite a weaker defense mix. The second is on the drivers of margin pressure on the offshore and the equipment system and solution divisions. And then the third one is a reminder on the CAPEX guidance for the year. Thank you.

So the first point is on shipbuilding profitability. Shipbuilding profitability has been planned with the revenue mix. So, obviously, because again, revenues in our business is very, very, I would say, easy to plan because they depend on the order intake. So, we are very clear the mix in the revenues of 2026 because they were dependent on the mix of orders. So the answer is yes. So we can obviously confirm the guidance for the remaining part of 2026 and we don't have any issue related to the revenue mix. On your second question is about margin pressure on offshore and equipment service. We don't have any special concern. The margins in our offshore business is driven by the level of saturation of shipyards and is driven by the contribution of the Vietnam production chain vis-à-vis the Romanian production chain. So, it is expected, it is a business that we know very well, and I think that the numbers are stable and can only improve, so we don't see any issue or pressure downward. On your third point, CAPEX outlook for 2026, We didn't give a guidance on CAPEX. They are implicitly considered in the net financial position and in the net financial position to EBITDA projections. We don't have anything special to mention in that respect. The CAPEX for 2026 are driven by the maintenance CAPEX we have been expecting and projecting plus certain specific improvement in, for example, Monfalcone shipyard where we are in the process of finalizing the installation of the largest ever crane which will be so important in 2027 and beyond for the construction of, for the more efficient and effective construction of the largest cruise ships ever. So I don't see nothing more to signal.

Thank you very much and good luck.

Thank you.

The next question is from Gabriele Garbarova, S.p.A. Please go ahead, sir.

Yes, thank you. Good afternoon, Pierroberto and Giuseppe. Thank you for taking my questions. Just a couple. One is on the medium-landing ship program in the U.S. You mentioned it, Pierroberto, but I was wondering if you could give me some more color. I think the numbers are really... Big, there was this, let's say, recent announcement from the prime contractor you will be awarded four ships. So if you could, let's say, give me some more color on this, even considering that somewhere I've seen, I've read that some, possibly the government accountability office hypothesized that that the remaining part of the constellation program might be terminated. So I was wondering if, for instance, your yard on Lake Michigan could focus on a single program that is the LSM, for instance. The second question regards the P&L. There were 26 million of financial incomes from investments in the first half. I was wondering if it was possible to have some more information on this specific item. Thank you.

Thank you for your question. On the LMS, I think it's the continuation of the story we've been describing, so the program is a very large one. It is expected, if I don't go wrong, to be more than 30, something like 35, 36. Two shipyards have been identified, ourselves and another one. It's a kind of fast track program because they want to build many of those ships and four are in the process of being formalized, four ships. And in the meantime, in order to cut corners, we received a kind of pre-order in order to start placing, you know, designing and placing orders for the long lead items. So, the procurement of those components whose construction lead time are long and therefore you need to start producing as early as possible in order to avoid then extra time. So, the willingness to go is, I would say, witnessed by the award of this pre-order. On your second point, constellation class, I think there is still a lot of reasoning in U.S. about which is the right strategy for freegates. So, there are a lot of school of thoughts. Someone is even starting to think that constellation class could have been a good option, if you want my what I'm hearing here and there. There is then another school of thought regarding with respect to which it's better to start from an existing platform even if this platform has to be redesigned in order to be a combatant ship so meaning you need to be you need to add anti- and all the other warfare measures. You have to transform kind of into a heavy combatantship. So there are multiple schools of thoughts. We are obviously available to contribute to this debate upon request. But again, Golden Fleet is not all about LSM. and Constellation Plus. So there is a large number of different programs that are going to be launched. And again, the U.S. administration made no secret that they want to enlarge, accelerate and involve the few reliable shipyards in U.S. So I think as we have been saying since two years. The good news is that U.S. is revitalizing shipbuilding and the good news is that Fincantieri is being in U.S. since 20 years with three shipyards plus one and with a long-lasting expertise with the supply chain and the U.S. engineering setups. On your third point, which is the financial investments, I will give the floor to Giuseppe.

Yes, as I said before, we had those 26 million euros were capital gain from the disposal of our minority state in the joint venture we had in China. We also did in the MDNA of the six months result.

Okay, thank you very much. Very clear.

The next question is from Friram Krishnam from Deutsche Bank. Please go ahead.

Thank you. Can you hear me well?

Yes, please. Go ahead.

All right. Great. Thank you. So, I have just two questions. The first one is with regards to order. Now, S.p.A., Pierroberto Folgiero, Giuseppe Dado, S.p.A., Pierroberto Folgiero, Giuseppe Dado, Felice Bonavolontà, Alessandra Battaglia S.p.A., Pierroberto Folgiero, Giuseppe Dado, Felice Bonavolontà, Alessandra Battaglia have been disclosed or firmed up. So that's the first question. And the second question is with regard to the net debt leverage. So you have provided that the leverage would be 2x by end of 2026. And I believe that's based on the first tranche of cash outflow with regards to the M&A of 600 million. Just wondering what would the leverage number be if you include the second branch where you need to pay out another 300-400 million, I suppose, for the public tender offer for next year. What would be the after that is done? Those are the two questions. Thank you so much.

Okay. So, on the 5 billion order intake in the defense that we have been expecting for 2026, we are not announcing anything yet. So, it is expected to come. What is already visible, so it's not being announced, but very visible, is the announcement made by our government with respect to three gates to Portugal. So, not included in the backlog, not disclosed yet, but so on top, and in terms of what is inside the five billion, The first information is at your disposal, i.e. three frigates from Portugal. Then there are a number of expected orders from the Italian Navy, which obviously we are not in the position and in the condition to disclose, but the DDX is the destroyer, is there, and it's written in the public documents of the Minister of Defense, and the same is with respect to other kind of ships under negotiation with the Navy. So, again, five is a number that can include, or better, I can make five only including the ships I'm just hinting here with you. Giuseppe?

On NetDev, yes, we reiterated the guidance of NetDev levels of two times EBDA at the end of the year and we reiterated the guidance when we did the press conference on M&A and this is directionally and, of course, linked to also the timing of the closing of the deals as we are waiting for complete the anti-trust clearance and the golden power clearance, but directionally, as we later did that message, two times EBDA over EBDA by the end of the year.

Thank you.

The next question is from Lorenzo Di Patrizio, so thank you for America. Please, go ahead.

Hello, good afternoon. Thank you for taking my questions. So the first one would be on offshore. So you say in the release that the market will now normalize after a period of strong growth. Can you elaborate more on the reasons behind this? I thought, for example, the expected Oil and Gas Market Pickup could have helped there. And then second question on NextGeo. So I saw you had an announcement recently that the owners will transfer some of their stakes to you. So what does this mean for the phasing of your stake of NextGeo that we should expect for the end of this year and next year? When will you reach 100%? And then separately, what growth for this business should we expect for the next few years?

So first question on kind of outlook of the offshore business. The offshore business is mainly driven by I would say several different Alessandra Battaglia, Alessandra Battaglia had a kind of slowdown, and this slowdown is being more than compensated by what is happening in the oil and gas. So I believe that this is the first micro-trend that we have to acknowledge, i.e. the kind of ships are quite similar, in particular for the S.O.V.s and C.S.O.V.s, so support and service and construction of support. So are more or less similar if you compare oil and gas with wind. And again, this is quite visible. So I'm sure you are aware that there is a large wave of expected investments in the offshore oil and gas for several reasons, including the fact that, you know, we need more energy. and there are some debts due to, you know, recent years slowing down investment in oil and gas offshore. With respect to cable layers, the business of connectors is so evident, it is growing. There are other listed companies that can give you more visibility in that respect. What I can tell you is that it is not all about electric connectors. There is a lot to do in the fiber optic connectors, in the telecom connectors. So we are experiencing a lot of focus on the telecom. And again, the demand for cable layers is obviously a direct function of what is happening and how much this Let me also add that there is a lot of demand also because the maintenance of underwater cables is proving to be another priority that was underestimated in the past. So in a world that is so much dependent on those cables, the current capacity and capability to serve and to maintain is lower than needed. So we are also having a lot of solicitation, a lot of requests also for ships that are again connected with underwater cables but also with the kind of hybrid ability not only to lay cables but also to repair cables. On the other possible specialized vessels, I think the recent backlog is very evident. So we are having a huge contract for research vessels. Again, research vessels, it's another testament of what is happening in the underwater. So those research vessels are able to map seabeds, you know, interact with the seabeds in view of, for example, seabed mining, so going for surveys or other kind of missions that are to new businesses, new opportunities. and also the business of trolleys is going to be interested to Bard because they have an extensive experience and a very satisfied set of clients that are, you know, showing up periodically. So that's why we believe that there is nothing to be expected from the offshore business, and we believe that conversely it can be only upward, given the order intake, given the saturation of shipments we are expecting, and again, given the contribution of Vietnam to the blended marginality of BART. Your additional question is on MESRIO, on all the acquisitions we adopted an approach according to which we want to guarantee continuity to the managerial, I would say, endeavor by means of involving shareholders' managers, because they are shareholders' managers, in the new phase. So basically we wanted managers only shares reinvesting in the new phase, in the new company. And that's what we did, which means two things, which means that the company will take benefit of this continuation of activity of this management team that did fantastically, because next year was a company built from scratch something like 10 years ago capitalizing on the vast experience of the key managers and then they leased it a couple of years ago and again I think they did a fantastic job that's why we are so happy to have them on board not only as managers but also as shareholders With respect to your question on when it will be 100% owned by us, we gave extensive details in the press release issued something like a couple of days ago. So you will find there all the details. It's a traditional scheme whereby there are targets and there are puts and call, put and call options. So no rocket science. What is really important for you is to appreciate that there is a big alignment of interest between the new shareholders, the manager shareholders, and the management targets, which is what you need to do when you are managing such a valuable asset, such as NextGeo, made of references, but made of also human capital that is remarkable. By the way, what I'm saying applies identically on the other acquisitions. So it is the same for WSense, which is a very beautiful scale-up company. It is the same for RealTech, which is made of very, very smart and experienced team of managers, and it is the same with respect to DEFCON, which is truly ahead of the market in terms of naval surface rules.

Okay, thank you.

Gentlemen, there are no more questions registered at this time.

Thank you very much. Thank you very much for your time and your interest. Thank you.