Arcadis Nv S/Adr

And gentlemen, thank you for standing by. I am Gail Lee, your chorus call operator. Welcome and thank you for joining the Arcadis Conference Call and Lab webcast to present and discuss the second quarter and half-year 2025 results. All participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a question and answer session. Anyone who wishes to ask a question may press star followed by one on their telephone anytime during the call. Should anyone need assistance during the conference call, you may signal an operator by pressing star and zero on your telephone. At this time, I would like to turn the conference over to Ms. Christine Dish, Investor Relations Director. Ms. Dish, you may now proceed.

Thank you, Gilly. Good day, everyone, and welcome to our 2025 Half-Year Results Conference Call. My name is Christine Dish, Investor Relations Director. With me on this call are Adam Brooks, Arcata CEO, and Willem Baars, Interim CFO. We will start with the presentation to be followed by Q&A. We would like to call your attention to the fact that in today's session, management may reiterate forward-looking statements which were made in the press release. Please note the risks related to the statements are more fully described in the press release and on the company's website. Now, please, over to you, Alan.

Thank you, Christine. Hello, everyone, and welcome to our trading update for the second quarter of 2025. Arcadis has delivered a solid set of results this quarter and in the first half of 2025. Our net revenues were organically stable year on year, and we saw continued strong demand in North America and Europe. Revenues accelerated for energy transition solutions, mainly in Europe. Water in the US was very strong, and large global technology clients are generating positive results for the business. This growth helped balance out a softer UK market in the period, which has been in a holding pattern ahead of the government's spending review, which is now concluded in June this year. As well as continued softness in the Australian infrastructure sector following a decade of sustained investments. Our backlog stood at 3.6 billion euros, resulting in year-on-year organic growth of 12%. This backlog reflects increasingly large multi-year projects, enhancing project visibility into 2026 and beyond. Our increased discipline and project selectivity at the pursuit stage has strengthened the quality of our backlog with a greater contribution from key clients, stronger alignment to our strategic growth areas and a higher margin profile. This strategic focus is reflected in the projects we are targeting, our order intake and quality of our backlog. As a result, we've positioned the business more towards high performance markets and clients. Margin was strong again in the second quarter, supported by expansion of our key clients program and increased contribution from the global excellence centers. We have remained disciplined through enhanced project selectivity and the execution of our strategy, with substantial investments made in digital, such as data platforms, AI, and digital asset management products, like Enterprise Decision Analytics, or EDA, and the launch of our new product, EDA Light, which I will talk about a little more later. We have also continued to invest in our people and new ways of working, including optimizing our resources workflow through our skill-powered organization program of skilling our people. Also, the announcement of a new GEC in Romania and the launch of the Arcadia Share program, which has seen 4,000 Arcadians already sign up in the first two months. Now let's have a look at the global business areas. Building on a strong demand in the first quarter, resilience has delivered a positive first half, with most significant contracts renewed in the first quarter. The 7% backlog growth was underpinned by key wins in energy transition, particularly in Germany, also in water and nuclear. In Europe, we have seen strong growth in German energy transition markets, which is driving near-term revenue acceleration. Our ongoing planning and technical advisory for Amprion on the Rhine Main Link energy route is critical in helping Germany meet its 2045 climate neutral energy target. In Q2, we secured additional scope on the project, resulting in a multi-million contracted value to our business. This strategic win will deliver 8 gigawatts of wind energy from Lower Saxony through North Rhine-Westphalia to Hesse by 2033. In North America, we have seen a continuing demand for water optimisation and climate adaptation services. Our expanding energy transition backlog is expected to support near-term revenue growth. and our margin benefited from disciplined project selection and effective cost management. Our work with the Ohio Environmental Protection Agency overseeing the lead service line inventory and replacement plan is a strong example of our water optimization expertise across asset management, advisory, and design and engineering. This project includes inventory review and development, tap car digitalization, predictive modelling, GIS software integration and dashboarding. Heading into the second half of 2025, we anticipate positive revenue momentum driven by energy transition projects with increase in AMP8 water orders in the UK and growing nuclear activity through partnerships on small and medium reactor delivery. In parallel, we are continuing to reposition our US environmental restoration portfolio shifting focus towards large, more strategic project opportunities, driving further margin improvements. Places. The places business demonstrated positive backlog development, which included a significant increase in large capital expenditure decision in some areas such as property and investment and industrial manufacturing impacted growth. However, increased government spending commitments now are creating pipeline opportunities in housing, defence, transport hubs, public facilities and healthcare, offering good visibility into the future. An example of work around investing in public facilities in the UK, where we have been appointed by the UK government to deliver, is the prisons estate expansion. This added two significant wins in tech and water and opportunities stemming from the increased capital investments in the UK over the coming years, points to a more favourable market business environment. The Lilly project I mentioned demonstrates our expertise in the pharma sector. This project brings together our industrial manufacturing and our architecture and urbanism teams and will enhance the global manufacturing network for injectable products to meet the rising demands for medicine in diabetes, obesity and future therapeutic needs. Further successes include the renovation of Amsterdam's iconic central station for ProRail, project management services for Tenet, and winning a design services framework for the expansion of London Gatwick Airport. The scale and breadth of these opportunities stemming from the US pharma sector, clarity on the European government spending, and a more stable market environment give us confidence that the places GBA is now positioned for improved performance in the second half of this year. And turning to mobility, this quarter saw a ramp up of major mobility projects in Canada and the US, helping to offset the slower activity in UK and Australia mentioned earlier. We are pleased to see the recent UK spending review confirm new opportunities for rail asset management, with significant increases in government commitment to local transport funding for areas outside London, as well as a confirmation of the east-west rail link between Cambridge and Oxford, and Midlands Rail Hub, both existing projects for Arcadis. A major success in the UK was a place on the framework for Northern Powerhouse Rail, which was also confirmed as part of the spending review. This is a critical pillar in connecting the north of England. The framework involves the delivery of multidisciplinary design and engineering services for major UK rail programmes, from outline scheme feasibility through to detailed design for construction, as well as incorporating modelling and benchmarking tools to optimise decision making and efficiency. In Canada, we were selected by Infrastructure Ontario to lead the development phase of the QEW Garden City Skyway Bridge twinning project, an essential step in supporting the future growth and improving the movements of people and goods in the Niagara region. The 2.2-kilometre twin bridge will add capacity, improve travel reliability and enable refurbishment of the existing structure, helping reduce gridlock. We're also seeing momentum on major projects such as Fraser River Tunnel in Canada, alongside key initiatives in the US and Australia that are now ramping up and delivering value. In Germany, integration of WSP Rail into our business is progressing well. WSP Rail's valuable pre-qualifications for Deutsche Bahn framework contracts are unlocking additional opportunities. While activity was slower in some regions during the first half of the year due to policy uncertainty, momentum is now building. Supported by our strong positioning in the US market, growing clarity around major programmes in the UK and Netherlands, and the mobilisation of several large-scale projects in the US, Canada and Australia. Collectively, these factors position us well for a stronger second half of this year. Looking at our intelligence business, the products there are increasingly embedded within our GBA delivery. They are becoming part of an integral offering to the long-term client relationships, driving opportunities into our business. These are not standalone capabilities, but a core component of our wider offering and continue to evolve as part of how we deliver smarter, integrated solutions to our clients. These products, particularly enterprise asset management and enterprise decision analytics, are now being deployed across our GBA client base, driving wins with organizations such as Amtrak in the US and City of Calgary in Canada. Meanwhile, products including Hotspot, Travel IQ, and our Tolling Solutions continue to generate recurring revenue and strengthen long-term client relationships. Clients are typically purchasing these tools for five to ten years, creating strong relationships with our teams. Looking ahead, I'm particularly excited about our new EDA Lite solution. This streamlined version of our EDA tool helps our consultants optimize portfolio data for clients, meaning we can quickly help clients solve problems like where to allocate capital spending or how to best achieve net zero targets. It produces fast results based on simple data that's setting up to gain traction with key clients across the water sector, such as Sardesp, and in financial services, such as Citi and Barclays. I mentioned the UK several times in my GBA update, so it's good to examine the UK and Ireland market as an instructive look to understand the headwinds in the first half of the year, and how the UK's strategy and focus our positions are strongly going forward. UK net revenue was 8% down organically in the first half, a 2% drag on growth for the group. But we are now confident performance will improve in the second half of the year. The long-awaited spending review released this June set out public budgets for the coming years and our relationship with key public sector clients positions as well for future investments. These investments are driving improvements in UK rail infrastructure, energy, affordable housing and healthcare services, with clients including Network Rail, HS2, Homes England, Ministry of Defence and NHS, all set to benefit from increased public spending. Moreover, we anticipate defence being a sector that can drive additional growth. The contracts related to AMP8 in the water sector started to materialise at the end of the second quarter and are set to ramp up as planned in the second half of this year. Projects with Wessex Water and Southern Water have demonstrated the potential of this sector, while our work in the nuclear sector, notably the recently approved Sizewell Sea and existing Sellafield sites, offer significant opportunities. And just last week, Arcadis has been appointed the lead delivery partner on Places for London. This is a subsidiary of Transport for London and is a major development programme which will need up to 250 Arcadians to deliver the project. And we'll see thousands of new homes, vibrant commercial spaces and enhanced public environments across London. This projected increase in public sector spending in the UK, coupled with strong activity from our large mobility clients in the US and Canada, as well as expected benefits from European investments that are beginning to materialize, all position Arcadis well for sustained growth in the coming periods. Looking at the major projects, over the course of the last 12 months, we secured a number of these major projects, While many of these began in the first half of the year, they will further mobilize and increase in scope in the second half of the year, driving revenue up in this period. In mobility, a number of medium to long-term schemes are now ramping up, shifting focus to North American projects following the gradual winding down of some major UK projects such as HS2. The Gateway Hudson Tunnel Project, a critical component of the larger Gateway Programme, the Fraser River Tunnel Project, a key component of the broader Highway 99 Tunnel Programme, and the Torrens to Dartington Road Project in Australia have all started in the first half this year and are mobilising fully in H2. All offer multi-year visibility up to 10-year contracts. The U.S. farmer market in our places business is equally starting to ramp up. Most significantly with the Lilly project I referred to earlier, the U.S. farmer business investments are expanding. In resilience, the Amprion project was the biggest energy transition project we have won to date. While initial orders have been called off on the AMP8 framework contracts and will further ramp up in H2. These projects represent approximately 10 to 15% of the total backlog, and the phasing will lead to accelerated revenue generation in the second half of this year, delivering over 20% uplift compared to the first half of this year. Further evidence of positive momentum supporting a return to growth. A range of global factors, including instability in some of our key markets, Delays in policy commitments, plus elections in the US, UK, Canada, Australia and Europe in the past 12 months, as we have said previously, have had an impact on our business. However, as we look ahead to the second half of this year, the more stable environment, particularly in Europe, and mobilisation of some of the major projects I've just mentioned, give us confidence in our ability to return to modest growth in the second part of 2025. And with that, I will now hand over to Willem Vaes, our interim CFO, to take us through the financial results from Q2.