Tinexta S.p.A.

Good afternoon. This is the Corusco Conference Operator. Welcome and thank you for joining the Tinexta Group Consolidated Results at the 31st December 2025 presentation. As a reminder, all participants are in a 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 by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Joseph Mastragostino, Chief Investor Relations Officer. Please go ahead, sir.

Thank you, operator. Good afternoon, everyone, and good morning to the folks connected from overseas. This is Tenexa's Fiscal Year 2025 results. Here with me today, Odone Pozzi, Group Chief Financial Officer. As a reminder, all documents related to the 2025 financial results are available for download on the investor relations sections of our company website. And you can connect to this call and to all other documents via QR code at the end of this presentation. Let's now turn to page three. For the purpose of this call, I will kick it off with the executive summary and business highlights. Adonai will review the fiscal year 25 financial results. I then will follow up with the BU outlook, and Adonai will wrap it up with 2026-2028 business plan targets. At the end of the call, we will be available for a Q&A session. Upon completion of this call, an audio recording will be available on our company website. Let us turn to page five of the presentation, which recaps a brief history and timeline of the MTO or mandatory takeover promoted by private equity funds Advent and Nextalia on Tinexus shares. In August, as you all know, Technoholding and the two private equity funds signed binding agreements for the transfer of a controlling stake equal to 38.74% of the share capital, subject to the two conditions present, namely antitrust as well as the golden power, which respectively came in in October and December of the prior year. The latter, which was granted on December 24th with the issuance of a prime ministerial decree requiring, among other conditions, for the disposal of the stake in the Teanexta Defense in favor of an entity deemed by the government capable of safeguarding the essential interests of national security and defense with reference to defense group. From the closing date of December 30, 2025, all information flows from Teanexta Defense to the parent company have been segregated and the stake has been transferred to a blind trust established in early January. At the same time of the closing of the transactions, triggering the launch of a mandatory takeover at a price of 15 euro CUM dividend per share, as well as the renewal of the Board of Directors, which was appointed by the shareholders meeting back in December of 25. At this point, maybe some of the most important elements for your information, they're all highlighted on this slide and they're all available on the website. The offer document has been approved by CONSOB on February the 19th with an acceptance period starting on February the 23rd. And just as a reminder, the acceptance period will last for 20 trading days and will end on March the 26th. Let's turn to page 6. Before I go over fiscal year 2025 figures, I would like to remind you that in accordance with IFRS, the defense group's contribution as of December 31st, 25 is classified in the income statement and balance sheet under discontinued operations and assets held for sale. This reclassification is also reflected in fiscal year 24 comparative data, but Donna will give you a more detailed explanation of the deconsolidation process while giving you an in-depth analysis of the financial results for the year. 2025 revenue grew by 4%, to $457 million, while EBITDA adjusted landed at $103 million, with a 3% decrease. Net profit adjusted from continuing operation came in at €36 million with a 3% decrease, actually, while falling to a negative €58 million on a reported basis, mainly due to some non-current impairment, which will be discussed more in that later during the presentation. Pre-cash flow on an adjusted basis from continuing operation was €70 million Growing 60% versus fiscal year 24, cash generation was reflected in the decrease in the net debt, which came in at $240 million versus the $322 million recorded in fiscal year 24. Net debt in fiscal year 25 also includes positive effects of the next defense debt consolidation, around $89 million in accordance AFRS. Leverage ratio sits at 2.33 times at the end of the year. It is important to note that results came in line with the preview already issued on January the 22nd of 2020. Turning to page 7, slide 7 shows the growth trends of Conexa key indicators over the last decade. with revenues growing on a CAGR base $14.25 at around 18%. EBITDA adjusted growing on a CAGR base, again, $14.25 at over 20%. Turning to page 8, results were in line with the preview as we just said. Revenues were $457 million, growing close to 4%, and EBITDA adjusted was $103 million, or declining around 3%, with a margin of 22.6%. The growth shown in digital trust was more than offset by slowdowns in cybersecurity and business innovation. EBITDA on a reported basis came in at $90.8 million with a 19.9% margin. EBITDA adjusted came in at $63 million, negative 6.68 million on a reported basis due to impairment of goodwill related to acquisition. Again, O'Donoghue will provide much more color on this later. As mentioned a few slides ago, net profit adjusted from continuing operations came in at $35.5 million, negative $57.9 on a reported basis. Net profit attributable to discontinued operations was equal to positive $12.1 million. The change in net financial debt to around $240 million is mainly attributable to cash flow generation as well as positive impacts from adjustments and, as previously mentioned, the deconsolidation of the defense group. Pre-cash flow adjusted from continuing operation was $70.4 million versus the $43.7 million recorded in the prior year due to lower capex and cash taxes paid during the period. On a divisional basis, on the center part of the slide, digital trust revenues grew by 7%, with EBITDA adjusted coming in at 5.6% and a margin of 31.2%, extremely healthy margin. mostly in line with the prior year. Cybersecurity revenues fell by 3%, with EBITDA adjusted decreasing by 4%, and EBITDA margin at 13.9%. In terms of BI, revenues grew by 3%, with a significant decrease both in EBITDA adjusted, minus 15%, as well as marginality, which came in at 24%. Finally, I would like to provide a brief overview of some of the key updates on the bottom. As we said, maybe it's worthy of mention, the fact that the board unanimously approved the issuer's statements regarding the MTO and deemed also on a unanimous basis the offered price fair from a financial standpoint. I will now leave the floor to Adona to provide more details on fiscal year 25 results.

Hello. Good afternoon, everybody. And as already mentioned by Joseph, let's move now to page 10 before entering into the analysis of 25 results. As mentioned by Joseph, following the DPCM of December 24th, we went through a different accounting for T-NEXT Defense following the FRS 10. So basically, the company has been deconsolidated since day one and also has been restated the financial figures of the year at the end of 24. Basically, at the end of 24, you will see as an asset available for sale, while at the end of 25, these assets available for sale has been accounted at short-term cash. So this means that is an asset held for sale, but following the prescription of the DPCM that was stating that the company would put on sale immediately in the short term after, you know, the move out from the control of T-NEXA. So, the correct accounting is reporting this within the net financial position as a positive asset. will be definitely sold. We will cash in. We will move from credit, financial receivable short term to directly to cash. So this is very important. So everything has been restated. All figures are really comparable. So the new perimeter has already changed. with the market is the full perimeter without defense tech. As already mentioned by Joseph, the year ended with revenue growing around 3 percent, so below our expectation, but still positive on organic basis. the EBITDA went down almost 3% and also the adjusted EBITDA and also net profit before adjustment has declined compared to previous year. Overall, the EBITDA adjusted close at $103 million. with an adjusted EBITDA margin at 22.6% reducing compared to previous year. And the net profit reported is negative by 45.8 million. I would say 70 of these are driven by impairment and related adjustment on the put-in-and-out positions. Very positive has been the free cash flow during the year, the extreme discipline in working capital management, as well as already uh anticipated to the market of a much more rigorous management of the capex allow the company to deliver 70 without the contribution of the fast tech seven more than 70 million from continuous operation of uh adjusted free cash flow in a very important draw compared the 44 million of the previous year So what happens to the P&L? We can walk through at page 12. Basically, as I stated, the revenues went up mainly, I would say, in two of the three divisions with the pace lower than one expected but still growing while we recorded a declining revenue in cybersecurity. In terms of costs, overall, the cost of service and our cost was handled more aligned with previous year, also with an improvement in terms of cost on the revenue, but this occurred mainly in commercial and G&A costs, while the third-party costs related to delivery of the business has increased quite significantly, as well as the increase of cost of salaries and personal costs went up quite significantly at 9%. And this was occurred especially in digital trust and in business innovation activity. And this has been mainly the driver of the decline in term of EBITDA that impacted the results. Other no recurring costs were aligned with previous year, while in the depreciation, amortization, and impairment, you had here a significant increase. As during the year, already in June and September, some impairment has been recorded following the weak development of activities in basically three companies that are all foreign companies like AGF primarily, and then also CETEROP and Aschezia in digital trust. During Q4, we had a shortfall in the success rate of activity of ABF that led us at the end of the day to the decision to develop a much more prudent plan compared to the previous one the continuous decline of the success rate driven by the very difficult financial situation in France, where the contribution to innovation to the companies has been significantly reduced, has driven to, like I said, to deliver a a much more prudent plan, and this obviously has impacted the fair value of the company. This is the reason why we had to run a full impairment of around 70 million in ADF. Further, let's say, impairment occurred in Ascerzia, also here driven by a weak Q4 that again led us to produce a much more prudent plan. With also a minor adjustment also on for value, the company is still increasing the performance compared to previous year. But again, also here the level of the plan that has been developed drove to a minor, to an adjustment of 6 million. On the other side, we had 23 million of positive impact in financial charges, between financial charges and financial income, because basically while we were reducing the level of the fair value of the company, also the level of the puts, the put and the outs has been reduced by 23 million. So overall, we can say that all the adjustment to the balance sheet of the group as recorded has driven an impact of 70 million, and this is exactly different from the positive of 35 million compared to the negative of 40 million. These are the main drivers of the results. You may see also that the net profit of discontinued operation Defense Tech has been recorded here. This is the combination of two different things stated in our Relazione. And so basically 3.6 is the results of the current, the 25 year of Defense Tech while The remaining portion is a recovery of the previous devaluation that we ran when we were doing the public offer. So this is the results of the company. And so in the following page, at page 13, you have here basically the adjusted figures taking out all the non-recurring operation. And I would say that the level of ABTDA has been already explained. The level of amortization of other intangible assets from consolidation, means from PTA, has been aligned with the previous year. I also went through the commentary of the 93 million of impairment, as well as the 2.1 combined to the 21.4 that is the benefit that we get on puts. If we move to page 14, you may see here in one single page basically the trend. that I already anticipated to you before working into much more details. Digital Trust has a growth in the range of 7% in terms of revenue, only 6% in terms of margin. Cybersecurity went down 3% in the revenue, being able to keep the decline of the ABDDA at 4%. while business innovation had a very, very weak year, mainly driven by cost management, cost and personal cost management. Digital Trust, overall, as we move to page 15, Digital Trust mainly delivered a revenue of 7% growth that is, you know, slightly below our original expectation, but overall we may say that this has been mainly driven by the performance, not positive performance from Ascetia. If we take out Ascetia, we may say that overall the company was able to grow in terms of revenue and profitability compared to the previous year, not at all far from the expectation. Very important is also looking in our business to the third bullet in line with our expectation as previously announced, the business unit dropped materially the capex that were extraordinary higher in 2024 to less than 14 million euros. So, like I said, we have more or less the same marginality. ABTDA went up around 6%, mainly driven by the performance of Ascensia and that we delivered here today. In cybersecurity, the performance has been not aligned at all with the expectations. The company was not able to keep the level of revenue of the previous year. Especially, we were facing insecurity solution issues a lack of capability to penetrate the customer and the market, and also we have some lack of profitability in some area of the activity. We were able more or less to keep the level of revenue in the digital space, portion mainly helped by some sales in proprietary product, basically the AML that is, you know, one of the most specific part of this business. But at the end, you know, in combination of the two, the company was not able to achieve the revenue targets and not even achieve the same level of revenue of the previous year. The company worked quite a lot on costs, especially on labor costs that went down compared to the previous year, a couple of million. We are talking about around 45 million euro of personal costs. So they went down. So they were also able to recover the natural costs cost growing of the inflation related to the personal cost. But this was not enough to keep the profitability that was missed compared to previous year of around 4%, keeping the same level of EBITDA margin around 14%, but still not achieving what committed at the beginning of the year. In business innovation, we talk several times during the year. Even last time when we issued the guidance, the manager of the group knew from a few days that a new issue of the rules for industry 5.0 could have been could have hit significantly the profitability of the company. At that time, we were all in a position to estimate a potential impact up to 3% of the profitability of the group in terms of EBITDA, and unfortunately, this occurred. So basically, here, definitely compared to the Last projections, we have been hit by the industry 5.0 last minute changes, changing of the rule, but it has been clear that overall the company was able to deliver a slight increase in terms of revenue, but in terms of cost management, the company, the again, already missed 3-4 million of revenue and profitability in the last part of the year without any opportunity to react in such a short term, but obviously this is the result. In terms of the French market, the situation is difficult. At the end of Q3, The level of the success rate of this kind of business was around 36%. And last year, the Q4 that was extremely positive with 50% of success rate drove the results up to 42% of success rate, enabling the company to deliver more than 3 million euro every TDAH. Q4 this year has been dramatically low in terms of responses, answers from the public bodies entitled to issue the contribution to the investors, and the success rate dropped to 31% in the Q4, affecting significantly the results of the year. What we are observing there is that Basically, the positive, the files that has been accepted by the public bodies went out last year with 36% fee for us that is linked to the level of investment in innovation. This year with 21%. It means that basically the government, the public bodies are approving only small contracts, and you can imagine that small contracts have by definition a much lower profitability, while the largest contract has been refused during this period. Combined, so we lost 3 million from ADS and the other 4 million from the other part of the business compared to previous year where industry 5.0 has definitely impacted the result. In terms of balance sheet, I already explained how we, how it has been dropped, the net financial position. and how much is accounted for the T-NEXA defense group. So, basically, this is already in the positive cash. Nevertheless, you know, the net financial position has been favorably impacted by the more than 17-year official cash flow that is very important here. achievement of the company, the company that's already distributed 20 million dividends overall during the year. The net investing capital obviously has been declined after this relating to the breakdowns of the goodwill of some companies and the consolidation of the defense group that brought the net investing capital back. below 600 million euro, while the good deal now is 370 million. Obviously, we had also an impact also into the shareholder equity. We have a decline of 34 million in the shareholder equity that is driven by the exercise of the call, the put, let's put it this way, of our minority shareholder, Banca Intesa, in the next Innovation Hub that led us to record a loss, the equity of 34 million, but in the end, the single balance sheet of... Tinexta Innovation Hub by 22 million, but this has been driven, again, the low performance of Tinexta Innovation Hub has driven a lower valuation of the group, and therefore, we recorded the loss while we accounted for the put of Intesa that is already in the net financial position as at the end If we move to page 19, I think already comment on the net financial position. If I go to the free cash flow, I may repeat here that, you know, we were able to increase significantly the cash generation of the group, very strong discipline in networking capital management, where we improved significantly also in business innovation. on top of other businesses. And we reduced invoice to be issued compared to the previous year. And also, we reduced the capex by 11 million. Overall, this led us to this result. I think that's all. I more or less explained what happened. and then I leave the floor again. Thank you.