Agfa-Gevaert NV

Ladies and gentlemen, welcome to the ACFA third quarter 2026 results conference call. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answer session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now, I will hand the conference over to Pascal Juery, CEO. Please go ahead, sir.

Thank you. Good morning, everyone. I'm sitting here in Marseille with our CFO, Declan Guerin, and with Viviane Dictus, our head of investor relations. So let me walk you through the Q3 results. But before we do that, we need, of course, to remind you that, indeed, following the announcement of the combination of our DPS business with EFI, This means digital printing solutions will be presented at the discontinued operations and therefore we have reorganized the reporting of the group for the continuing part along two segments. One of course is healthcare IT, so there is no change here, so the IT part of the business. And the second segment is Imaging and Advanced Materials, where we have regrouped actually the industrial part of the group. And today's results, of course, we are going to be focusing mainly on the continuing operation, even if we are going to give you as well a view on the performance of DPS. But as you know, DPS is going to be combined with EFI. We're expecting the closing to happen by So going to the results, I think the message I want to pass is the transformation of the group is on track. And Q3 is typically a rather weak quarter and this one was no exception. And as you will see, pretty contrasted performances according to the business. You will all remember that Q4 is typically the strongest quarter of the year. So if I turn to the performance, sales are flat, but as you will see, very contrasted in fact, because we've got good dynamism in some of our businesses, where in others we are suffering also from market environment or mixed impact. Adjusted EBITDA 1 million in the new continuing part. So indeed a weak quarter and we explain to you why it is so. Just also want to stress that our saving plan is absolutely in line with our expectations. We have saved 64 million. The main source of saving is coming from the reorganization of the operation of our film and chemical unit. but also with the review of our go-to-market in mainly film and digital radiology. We are still consuming cash and this cash consumption is purely coming from the cost of transformation of the group In the segment, LCIT sales up 11%, EBITDA also quite up versus last year, and more importantly for me, the continued momentum in order intake with plus 21% on the last 12 months rolling, actually. And in the same last 12 months, our cloud orders have more than tripled. So as you would see, really healthcare IT who are doing extremely well in the transition of the cloud if anything is accelerating. I should add that most of this increase in order intake is actually coming from new customers, new logos that we are adding every quarter to our order intake and pipeline. So it's a very positive development. Imaging and advanced materials, a more subdued performance, three businesses in this segment. Film and chemical will continue to be ahead of last year, actually, in spite of strong volume decrease. You also have some accounting impact related to silver that is having a negative impact on this quarter. and we should say that our DR business that is a subject of a go-to-market organization in 26 with the separation I would say from the film go-to-market is undergoing a kind of reorganization in itself a channel which is having an impact on our current performance and GHS Hydrogen as we know is a very weak year for us in 26 but I repeat immediately that we already have some visibility in 2027 and it's going to be a very significant rebound of the activity. DPS, again commenting on the performance although it's not part of the numbers and commenting. Sales are down but it's more a mix effect I would say. We had sales especially in the packaging area that were not repeated this year. What's more important is that even with cells below last year, actually EBITDA is up year on year and our ink cells also continue to show a good dynamism with an increase of 12%. So overall I would say we are entering the combination with EFI in a position of Good performance for the business as you know sales can be a bit lumpy quarter to quarter if we are down this quarter it's mainly due to equipment but we are going to make it up more than fully in Q4 and Q4 again for DPS is really the quarter of the year where we ship the most equipment and where we deliver the most EBITDA I'm gonna now turn the presentation to Declan who will walk you through the numbers

Thank you, Pascal. Hello, everybody, and very glad to be here on my first quarterly call. So do give me a little bit of latitude as I work through the numbers. So if we look to the headlines first in terms of revenue and adjusted EBITDA, again, just as a reminder, these are in quarter numbers. and overall flat quarter three 25 versus 26 on revenue but as Pascal mentioned some mixed impacts so healthcare IT marching ahead with double digit growth and the imaging and advanced materials retreating a bit. On the EBITDA line The percentages are far more dramatic obviously with smaller numbers but we've gone from 4 million down to 1 million in the quarter again with healthcare IT marching forward and imaging and advanced materials again following the volumes downwards. It's also worth just noting, I'll get into the details in the following slides, Thank you very much. Last year, and then on the EBITDA number, we had 22 million for the corresponding year-to-date period last year. This year it's 25 million, so up 18 million. Then if you take into account mix and other changes happening, roughly, roughly flat year-on-year if you look at the balance of revenue and EBITDA. Then moving on to the sales bridge and 210 to 210 in the quarter. Small pluses and minuses. We talked about healthcare IT. This is obviously growth in sales we show here, but also the 12-month rolling order intake is up 21%. which is a very, very good development. And we'll come back to the shape of that order intake a little bit later. Films and chemicals, down a bit, but, sorry, it's up a bit, but that is primarily the impact of silver pricing rippling through our numbers and not volume. So if you did a price volume thing, of course volumes are not in the same place at all. Digital radiology, it's a reorganization year we're in the middle of a reorganization and that will continue but we see the impact on our sales where it has retreated a bit as they look to prune the into boost the market product portfolio etc and then green hydrogen is back quite a bit from smaller numbers but it's back quite a bit mainly related to external factors market close and we expect that to come back as we go forward into next year then moving forward to the adjusted EBIT average and again just to remind these are the in-quarter numbers and as I mentioned in the summary we've gone from four million to one million but here because of the small numbers the waterfall looks a lot more exciting and again the volume increases that we've seen in healthcare IT have driven additional gross profit that falls mainly to the bottom line. But as the opposite direction we see in imaging and chemicals, a gross profit impact where it goes in the opposite direction. And again, in quarter, we've seen in the segment 18.7% margin last year in the quarter. This year it's 15.8%. it looks like a pretty dramatic drop but again when we look to the timing of the impacts of silver and other things year on year it's 20.6 versus 20.7 pretty much flat and then we got some R&D costs SG&A cost savings and other movements bring us to the one million at the end Okay, this is pretty much the same in table form. I won't go to the headlines above, adjust the EBITDA. It's just worth noting that there are some big movements below EBITDA in terms of adjustments, restructuring expenses, et cetera, that do ripple through financial statements. And this was the ACFA FODO financial settlement that we had last year. It's coming on the year-to-year numbers, just to note that. Then cash flow in the quarter we're minus 14 million and again this is primarily driven by transformation related cash outs and if we walk it across from the adjusted even down the quarter of 1 million to the minus 14 million at the opposite end we've had some changes in working capital so these have been positive but we know that working capital does move around from quarter to quarter, depending on what's happening in the business, et cetera. We also have the impact of factoring in here as well. And you will notice on the comments on the right that the movement between quarter two and quarter three is primarily a reflection of the DPS carve-out impacts. CapEx mainly capitalize R&D, healthcare IT, that is, Thank you very much. bits and bobs of other costs we've got tax believe it or not in spite of the net results of the group this is how subsidiary activities get taxed locally where we don't have tax shelters there's also some tax leakage that comes from those activities the adjusted free cash flow the 8 million that is a good number to look at so that's a cash conversion number of EBITDA but of course we have the pension liabilities as an ongoing cost that comes and then we've got adjustments of non-recurring items related primarily to transformation related cash out again which is an investment we see back into the numbers but it is a drag on cash flow. Table here I think I've spoken pretty much the most of this and again like I mentioned on the P&L on the cash flow Thank you very much. Thank you. The leverage in covenants and gross to net debt. Of course, when we look at the gross debt numbers for the group, it's dominated by pensions. then we have the leasing activity and then we have the net financial debt gross borrowings less cash that we have at hand and it's just worth noting on this few things so the pensions and the leasing numbers have been adjusted to reflect discontinued activities but the net debt number the red number that is obviously remains at the group level and the terms of the that's the 92 million in terms of the covenants so we we ended the quarter this is on a rolling 12 months basis at 1.9 times x versus the Covenant Max of 3. For interest cover, we were at 8.6x versus the minimum of 4 on this. In terms of liquidity headroom, we're at just under 96 million versus a 30 million minimum on this. So inside the Covenants, which is always good with some room, and it's also worth just noting again, even though it's been previously announced, and in August we extended our RCF agreement with our Club of Banks to the 1st of August 2030. So we have a long duration maturity on these arrangements as well. So that's good.