Bilfinger Se Unsp/Adr

Good afternoon, ladies and gentlemen, and welcome to our webcast on Bill Finger's full year and Q4 2025 results. My name is Martina Kalkarke, and I'm joined today by our group CEO, Thomas Schulz, and our group CFO, Matti Ecke. We will start with the presentation of the quarterly highlights and also the full year financials and then open up the call to your questions. You will be able to ask your questions via telephone by pressing star and one. And you will also be able to ask your questions via the chat and I will read them out as usual. During the presentation, all participants will be on a listen-on remote and the event will be recorded also as usual. Now I hand over to Thomas.

Thank you very much, Martina. Hello everybody out of the sunny Mannheim here in Germany. When we look into the year 2025, we can say that we achieved all financial targets what we set out for the year. It was a year with clear market. Our market position expanded but in a very volatile environment. Our orders received went up 6%, revenues 8%, EBITDA margin up by 30 basis points and free cash flow significant up to 330 million euro. We propose a share increase from 240 to 280 euro per share. The outlook for 2026 we fix with 5.4 to 5.9 billion euro and the EBITDA 5.8 to 6.2%. On our list were in the last year acquisitions. We did three acquisitions and we announced one signing in that case for Turkey. When we then look into the targets a little bit more detailed, you see on the left side the revenue development, 24 full year to 25 full year. We achieved an 8% growth and a 4% organic. In EBITDA, we are up 13%. This proves that our system, our strategy with operational efficiency is actually working quite well. our free cash flow made a significant jump upwards from 189 to 330, which is a 75% increase. Our outlook was 300 to 360, but that was actually brought up during the year. When we then look into that, what we do as a company, you know that sustainability is the core. Efficiency is the core of the Billfinger Group to improve that on our customer sites and customer businesses. On that very lively slide, I would like to have your focus on the left down part, the greenhouse gas emissions, scope one and two intensity, measured in CO2 versus million euro revenue. And there we have a significant step improvement by minus 15% from 24 to 25. The second thing is in the middle of the slide you see more than 0.5% of our revenue as an investment in learning and development for our people. Our people are our asset, our people are our reputation, our competence and in that case our future. That target of course we fulfilled for 2025 and we will fulfill it for 2026 too. Above that, it's about safety. Safety is not only important that all our employees and people related are safe and in safe working conditions, it is actually for our customers a quite good KPI to see how our performance as a company, as a group on customer side is working. And we can announce with, yeah, quite a lot of being proud of our own people that we had one of the best years ever in the Billfinger Group. We actually improved the TRIF from 1.12 down to 0.91. and the LTIF significantly from 0.32 to 0.18, which is both world class and shows the position of us to help customers to get more efficient. Next thing is that we measure our business in four categories. Because for mechanical industrial service, the European taxonomy and classification out of Brussels just forgot about that part of the industry, which of course is quite important. So we introduced at the beginning of 23 our own classification, what you actually know when you buy, for example, a fridge in an electronic store. A is very environmentally friendly. D is not environmentally friendly. And here you see the year 23, 24 and 25 on the left side. And you see that we are in the categories with the darker blue color step by step going up when the gray one, which is actually the coal and fire energy generation related business, is slightly going down. To give you a little bit more information, you have on the right side some of the orders. For A, it's a clear energy generation, CO2 reduction, direct business. In B, it's enhancing energy efficiency. And in C is all the support for that work. If we then go further to the industry outlook and industry development, how is the business going? We use for quite a while the production index and you have that on the left side and it's indexed the first time here to the year 2023. Before it was 2019, the last year before COVID. And 23 is the first year after COVID, or we hardly can say it was completely over, but a good measurement. And you see four graphs, and the graphs actually symbolize the different industries. Of course, the most sticking out is, of course, the green one, pharma, biopharma, with quite an increased outlook to 130 up in the index up to 2030. Then you have energy, then you have oil and gas, and then you have chemicals and petrochem. On the right side, you see very much what our share is. The biggest industry we are operating now in is energy with 24%. The demand is okay and good. And then we have chemical and petrochem, which is 23%. Demand goes sidewards, and here the sidewards movement is predominantly out of Germany. We don't see a fervor going down, but we don't see a significant up, no matter that they are the first positive signs at the end of the tunnel. Then we have oil and gas with 18%, where the demand is good too. And of course, pharma, biopharma, where we still see quite a positive market. Important in that is our outsourcing potential, the potential where customers decide or could decide to give us, Billfinger, a big part or their complete maintenance business because we are experts in it. We do it more than 1,000 times per day, and that actually generates for the client a lot of positive profit impact. These outsourcing potentials are significant good in the chemicals and petrochem because they are, our customers are there for quite a while under pressure. And you see energy is good, oil and gas is good, and pharma and biopharma is good, and it's part of our growth story. Then we go further. It's about selected orders. We always show you three orders of different geographies and different industries. On the left side, it's from our dear client Borealis in Sweden. It's actually about the responsibility of Bildfinger to create an increase in production capacity in chemicals and petrochemicals. In the middle part, it's about energy. It's Estonia, our customer Utilitas. And again, it's about district heating. We in Bilfinger believe strongly that district heating is an ongoing positive development. And it makes actually from an energy point of view a lot of sense. On the right side, we have oil and gas out of Germany. It's the company Gasco. And it's about the reliability of the gas supply and gas infrastructure, which is nowadays more important than ever before. Out of that we go to innovation because we as an industrial service provider have a fantastic position by having most of our people permanently on customer side to create ideas and to make products out of it. This product what we show today is the Bilfinger acoustic corrosion detection system. When you are on a processing plant you have pipes, you have containers, you have storage tanks, with material in it, liquids, gas, powder, partly flammable, partly quite aggressive in the environment. And when you try to detect corrosion, which is of course important to know what happens, you have normally in a regular operation to empty all of that so that you can make your measurements. We developed, together with other partners, a special acoustic emission sensor where we can go in a current environment in operation into the plant and measuring the effect of corrosion as a potential threat, leakage and so on. That is not only reducing the downtime for the customer and bringing up cost savings for the client, it is a significant safer approach and fits very much into our safety story. Out of that, we come to the figures. On the top line is our more or less already quite famous opportunity pipeline, what we invented several years ago. It shows actually indexed to two years before the amount of possible opportunities for the Billfinger Group, judged by if they will, out of our point of view, happen and if we have a chance to take the order. And when you see the development of the fourth quarter in the last two years, we actually improved with that potential what we have in front of us to roughly 110 versus that what we had at the beginning of the year, at the end of the year 2024 or in the year 2025, or 23 and 24. When you look into it, a part of that improvement, of course, comes through our quite active M&A strategy, what we drive. Each M&A is, of course, adding us more potential. Out of that, the orders received. When you look here, we actually had a good year, but as it is typical for us as the Bilfinger Group, we have quite a fluctuation between the quarters in the order intake. It is based on the fact when milestones or contracts are dropping into a quarter from a timing or not. So out of that we had organically and unorganically a negative development versus the quarter four in 2024. But our order backlog throughout the year and versus the quarter actually improved by 5% or 4%, which shows a very good stable development of our group and is full in line with our growth story. Out of that, I would like to give to Matti, our CFO.

Yes, thank you, Thomas. Good afternoon, also from my side here. Yes, let's take a bit of a deeper look into the numbers. As Thomas said before, the orders received in the fourth quarter were a bit, let's call it softish, based on timing of contract awards and volatility in the markets that we have, I think, communicated quite well over the last two years at least. For the full year, orders received increased by 6% in total, 2% organically. The acquisitions play a role in here, but also we had a little bit of a negative impact from the weakening US dollar. Order backlog reached 4.3 billion after 4.1 billion in 2024, so a very nice increase. Revenue, a strong increase of 8% and 4% organically to 5.4 billion euros. growth in the energy sector, in the pharma and biopharma sector, and obviously due to the cost pressure, some decline in chemicals and petrochemicals. As part of our de-risking, we introduced to report our revenue shares by remuneration type. Early on, we just differentiated between projects and service and frame contracts. This year is a better picture. Almost 50 percent, 44 percent to be exact, is time and material. Close to 20 percent is unit rates. 70 percent is mixed. in the remuneration and only 20% is lump sum, which gives you a fairly good picture how well our contract portfolio is risk managed. On the profit side, our gross profit increased from 10.9% to 11.3%. That's an increase on the absolute terms of 13%. Again, what we announced during the strategy, product mix improvements, de-risking, standardization, all of this do drive our margin improvement across all segments. On the SG&A side, we remained stable across the year at 6.3%. However, we have to say that the acquisitions, the three acquisitions that we did in 2025, came in with higher SG&A ratios, which does give us opportunities for cost efficiencies in the future years. And EBITDA developed very well from 5.2% to 5.5%. And the last quarter at 6.1% was the strongest quarter sequentially. We had 4.5 in the first quarter, 5.5 in the second, 5.8 in the third quarter, and then 6.1% in the fourth quarter. So a very nice development sequentially. Important also is to look at the adjustments. As you know, we do report only reported numbers, but to give you a full picture here, we had last year a positive contribution from those adjustments of 7 million and this year of negative 8 million. So that's a swing of 50 million. If you factor that in, then you see the real operational improvement, which is then more than the 30 basis points here. If you refer it to EBITDA, then the improvement is 50 basis points. Take a brief look into the segments. You will know that we have changed the segment structure effective January 1, 2026. Here is 2025, so it's the pre-existing segments in Europe, a very large segment with revenue orders received of close to 4 billion. That's a slight decrease organically, but overall a 6%, a strong 6% increase. Revenue, very similar, organically a slight decrease, but overall 6% increase for the full year. Book to bill at 1.06. Stable, same as last year, 1.06. And the order backlog reached 2.9 billion, so almost 3 billion euros in the segment. On the profitability, in margin numbers, a slight decline. from 5.9 to 5.8%. But what I mentioned before in terms of the adjustments, here we have a swing of a total of 17 million. So again, if we look at EBITDA adjusted, that improved from 8.1% to 8.5%. You'll find those numbers in the backup to the slide deck. International, very nice performance across all KPIs. 17% increase organically, 13% in total when we look at orders received. We did quite well on frame contracts in the United States. The government customers still are hesitant to award contracts. We had the shutdown, shutdown ended, and then there was another one. So that takes a little while for this process to restart again. But very good new orders from oil and gas and energy industry in the Middle East. Revenue grew by 6%, 10% organically to $742 million. And the profit from a break-even position last year to almost 4% for the full year. And again, it's operational excellence that's driving margin expansion, not only in the United States, but also in the Middle East. And then technologies, also very nice performance on all KPIs, 6% increase in orders received, nice growth in nuclear and in biopharma and pharma, and the revenue increased by a stellar 17% to $856 million. Book-to-bill at 1.0 is lower than last year, but you know the business is more volatile than the other ones, so nothing to be concerned about. Profit very stable in the fourth quarter at 8%, but overall throughout the year from 6.2, 80 basis points up to 7.0%, a very nice performance in our technology segment. for the group net profit for the year. In 2025, we achieved 176 million for the full year. There's an impact in there that I need to mention. bought back shares from minority shareholders in one of our larger entities that had a negative impact on the financial result. And it had a negative impact on our tax rate. So consequently the earnings for the year and the earnings per share are down by 1% for 2025. Cash flow, I think Thomas mentioned it before, we achieved 330 million free cash flow for the year, a 75% increase, 110% cash conversion rate, Some positive effects in here, a large payment from a dispute in the United States that we settled in 2024 and the cash came in in 2025. So that certainly helped to improve the cash flow. But more importantly, our working capital efficiency that we measure in net trade assets over revenue has improved from 9.6% to 8.3%. as we had planned and announced it last year. On the net liquidity or net cash position, no change on the debt side. Very stable on the financial debt and also on the leasing liabilities. They fluctuate a little bit with the acquisitions. But we had payouts for the For the share buyback program, we had payouts for M&A and we had payout obviously for the dividend, but still we increased our net liquidity position from 88 million to 146 million by almost 60 million euros despite those payouts that we had. No change on net debt and consequently no change on the leverage. We're down to 0.5%. three at the end of 2025. Capital allocation, very important. No change there. Dividend, very important. We will propose two euros and 80 cents per share. That's up 17% from last year where we proposed and paid out two euros and 40 cents. We're funding our organic growth in terms of sales improvements, people development, innovation, digitalization. M&A plays a significant role, and more importantly, and as we announced at the Capital Markets Day, we will accelerate there. And then obviously, if something is left, then we have all kinds of options in terms of shareholder returns, but it's also very important that we maintain, no matter what we do, we maintain our investment grade rating. Let's take a quick look into 2026. The updated segment structure as shown on the left-hand side, the segments are in size more equal than before. Western Europe is about one third of the group, Central Europe a bit less than 50% and international is about 20% of the group. So it's more balanced than what we had before. We are working on a full restatement, and that restatement will be made available in the week of April 20 to everyone who is interested, and we will publish this on our website. So for the Western Europe segment, which includes countries Holland or Netherlands, Belgium, and the U.K., We see revenues of 1.8 to 2 billion for next year and an increased margin of 7 to 7.4%. Central Europe, which includes Scandinavia, the Nordic countries, Germany, Switzerland and Austria, we see a revenue of 2.5 to 2.7 billion and an increased margin of 5.8 to 6.4%. And for international markets, 1.05 billion to 1.2 billion and also an uptick in EBITDA margin of 4.2 to 5.0% and then reconciliation is just for completeness sake. So that I think are good targets and what it does for the group. I turn over back to Thomas.