Rai Way S.p.A.

this is the conference operator welcome and thank you for joining the right way full year 2025 results presentation all participants are in listen only mode and after the presentation there will be a q a session at this time i would like to turn the conference over to mr andrea moretti head of ir please go ahead sir thank you operator and good evening

At today's conference call, we will present RightWay's 2025 full-year results, operating achievements, as well as our 2026 guidance. Today's hosts are CEO Roberto Cecatto, CFO Adalberto Pellegrino, and our Chief Corporate Development Officer Giancarlo Benucci. Please, Mr. Cecatto, go ahead.

Good evening from me, too. The fourth quarter and more in general, the entire 2025, confirmed the sound and stable fundamentals of our business. This year, further supported by cost control actions and non-court benefits. As you may remember, in March of last year, we provided an outlook for 2025 guiding for a broadly stable adjusted bid day. We have largely exceeded the target. And while it's honest to say that a big part of the bid came from non-core items, let me say that the operating performance also proved to be better than expected, in particular in the traditional business, both in terms of top line and opportunity to optimize the cost base. Consequently, as shown on slide 4, we maintained the upward trend in our key metrics even during the startup of diversification initiatives, which are already starting to contribute to our medium and long-term growth. More in details, looking at the overall financial result, the 2.4% year-on-year increase in revenues reflects the contribution of both our ANCO customer Rai, supported by inflation and the gradual expansion of the DAB network. and by third-party clients, which on an underlying basis rose by 4.4% over the full year and by, let me say, a remarkable 10% in Q4. Third-party revenues rose We're driving by, first, the excellent performance in the tower hosting of radio broadcasters as they are rolling out DAB networks. Second, the growing utilization of our EP fiber backbone for connectivity services. And finally, by the diversification initiatives which generated over 1 million of Euro revenues in 2025. In terms of adjusted EBITDA, as mentioned earlier, the increase compared to 2024 of over €6 million in absolute terms was driven by these factors. The traditional business contributing approximately €5 million, also thanks to the reduction in external costs. The expected higher absorption of approximately 1 million from diversification initiatives, which we nevertheless managed to contain despite the more gradual revenues evolution. And finally, as anticipated, the level of certain non-core items, which contributed positively to grow for approximately 2 million and 2.5 million euros. The net profit saw a slight decline due to the expected rise in depreciation and amortization and reported one-off costs for over 4 million euros. Excluding the one-offs, we could say that the profit would also have raised the horizon. In terms of capital expenditure, the maintenance component was higher than usual and of course confirmed the recurring level of around 6% of revenues due to some extraordinary activities, for example, relating to passive infrastructure and the cyclical renewal of certain IT components. The development component on the other end stood at around 30 million euros, consistently with the refacing already discussed in the last November conference call. The recurring cash generation to equity holders stood at around 118 million euros, broadly in line with last year, despite the above-mentioned temporary fluctuation in maintenance capex. If we were to consider the over-the-cycle figure for maintenance capex, the trend will still show growth to a level above €120 million. As for the dividend distribution, in line with our usual policy, we confirm the payout of basically the 100% of the profit generated, meaning €0.33 per share. I would like to point out that with this year's distribution, we will have essentially returned to the shareholders the full capital invested in the IPO in 2014. To be precise, 95%. Moving on the operational business update, I would like to focus on the recent progress made on the development initiatives included in our plan. Within a context anticipated during our November call involving certain delays relating to authorization processes or market condition, which we do not believe will undermine the rational or long-term potential of our project, the company has not remained passive. And recent months have brought some positive updates. Regarding the traditional activities and assets, the extension of the radio network for RAI is proceeding smoothly. As of December 2025, it has achieved population coverage of approximately 70% with 179 sites compared to the initial 56% with only 62 sites. and the full scale target of 85%. For the photovoltaic project aimed to creating value from our real estate portfolio, we are receiving permits for the first four sites totaling over 12 megawatt. You can see that on slide six. Let me say that considering the various legislative changes to the authorization procedures occurred while we were working on that, so it took more time than previously planned. But we have already placed a purchasing order and we are about to start construction with the installation time of around six months and first revenue contribution expected by the end of 2026. And in 2026 and early 2027, we expect to receive further authorization, so we can consider 2028 as the first year of full-scale contribution from such a large project, in which we plan to invest more than 30 million of euros, and we expect the round rate contribution to a BDA in the region of 4 million euros. Let's now move to diversification, to slide seven. Today's focus is on data center, in particular on the long-awaited successful completion of the regulatory process for the high-scale data center in Pomezia. It followed the positive outcome of the so-called Conferenza dei Servizi and the signing of the concession agreement with the local council. The authorization set out the physical footprint and size of generator, so the shape, for a project with four independent modules covering 70,500 square meters, 16 data holes, four per each module, and an IT load of approximately 35 megawatt. In parallel, we are also working with the electricity grid operator to define a timeline for high voltage availability. However, the initial phase, at least for the first 6-7 MW, we will rely on the medium voltage line and our own photovoltaic system, which is among those mentioned earlier. Bear in mind that the authorization itself has already generated a significant initial value. A site with an approved project holds a not negligible worth. Let me say that we have an independent expert check that estimated the actual value at 15 million of euro. However, this is not the end goal. we are now starting engaging with prospects also in order to identify the best strategy to develop the asset. Indeed, this asset is authorized, which therefore guarantees a significant reduction in time to market. It's an optimal size and modularity making it compatible with both hyperscale and more enterprise-oriented use. issue flexibility regarding the fit out therefore it's fully a compliant ai compliant if necessary and requested it is located in rome that is a strategic location from several perspectives And last but not least, it has access to our proprietary edge architecture, including regional data center and fiber optics, capable of supporting AI inference and other low latency applications. We are confident about the project's appeal to hybrid scalers, cloud operators, and larger companies. But let me say that our aim is to balance the risk-reward profile of the investment while ensuring the scalability of railway business. Coming back to the mention in the slide four for the regional data center, let me say that we are waiting for a wider adoption of latency-sensitive application, for instance, also AI inference. And completing our network through the hyperscale, we are primarily targeting enterprise customers. As you may recall, in order to improve the commercial effectiveness of this segment, we have expanded our offering to include infrastructure as a service solution. This solution combines physical data centers with virtual storage and computing, essentially data center, server, and the virtual environment. And the move is actually helping to reduce our customer decision-making times and to better channel infrastructure requirements, primarily those underpinning the cloud into our asset. It's a fragmented market with a large number of opportunities, albeit with a small average value. So over time, we expect to see a gradual increase in the contribution to our figures. Our commitment to sustainability has certainly not changed in 2025. On the contrary, its principles have become an increasingly integral part of our business management We will provide an update on the progress of the plan later, but I am pleased to announce that we have achieved one of the key objectives, so the carbon neutrality. I will now hand over to Adalberto for all the details on this year's financial performance, and I will be back at the end to discuss the outlook for 2026. which i anticipate to be in line with the positive trends of the recent years and for some closing remarks please alberto the floor is now yours