Durr Ag Spon Adr

Welcome to the DER Conference call. Dr. Jochen Weyroff, CEO, and Dietmar Heinrich, CFO of DER-AG, will present the DER Group's figures for the first half of 2024, followed by a Q&A session. I will now hand over to Andreas Schaller, Head of Investor Relations of DER-AG.

Thank you very much, Heike. Ladies and gentlemen, welcome, and thanks for your patience. Good afternoon, good morning to those of you in the US. This is our Q2 earnings conference call, and as usual, with me on the call, our CEO, Jochen Weibauf, and our CFO, Dietmar Heinrich. And they will present the results of the second quarter and first half year, as well as the outlook, and we'll be happy to answer your questions afterwards. As always, our earnings presentation is available on our Investor Relations webpages, and we assume that you have it in front of you. Please be aware of our disclaimer regarding forward-looking statements on slide two. And now it is my pleasure to hand over to our CEO. Jochen, please go ahead.

Thank you, Andreas, as usual, for the short introduction and welcome also from my side. Let's start with the highlights of Q2 on slide five. Overall, it was a good quarter with a solid operational development and cash flow. We achieved a strong order intake of 1.3 billion euros, This brings us to a new record order intake for H1 of almost 2.8 billion. The main driver also in Q2 was our automotive business, where we received two large orders with triple-digit million-euro volumes and several orders of a double-digit million-euro size. We observe at this time that customers are awarding us mid- to long-term projects at an early stage in order to secure capacities. The project pipeline continues to look solid. Sales revenues were up 6% year-on-year to about 1.2 billion euros. The book-to-bill ratio stands at 1.22 after the first six months. The EBIT margin before extraordinary effects improved sequentially from 4.9% in Q1 to 5.2% in Q2. Our division's application technology and clean technology systems continued their strong margin performance. Your extraordinary effects in Q2 were temporarily higher than in Q1. They included one-time expenses for the divestment of Agamco and for capacity adjustment measures in production automation systems as we are realizing synergies. What is not included in the extraordinary effects in Q2 is the book profit from the sale of Agamco. This will come in Q3 and more than compensate for the increase in Q2. Free cash flow was solid in Q2, driven by the strong order intake and the continued disciplined networking capital management. Based on the positive development of the first half, we confirm our outlook for 2024. Looking at the high order intake level after six months, we see a good chance to reach the upper end of the guidance corridor for order intake, which is 5 billion euros. On slide six, we see the key financials for H1. Order intake increased by 8% and includes a consolidation effect of 146 million euros related to the BBS automation and INGECAR. Sales of 2.3 billion euros include consolidation effects of 167 million euros. The sales decline at HOMAC of about 14% was more than compensated. All other divisions grew organically. EBIT before extraordinary effects improved by 9%, and the margin was slightly higher year over year, despite the weakness of OMAC. Net income, however, declined by one-third due to higher PPA effects following the BBS automation acquisition and higher interest costs. In addition, as already mentioned, we had one-time expenses related to the sale of our GAMCO and capacity adjustments at production automation systems. The free cash flow of 44 million euros after six months is quite strong. This year, we benefited from the higher order intake and are well on track to reach our guidance. Let's take a closer look at the order intake on slide seven. I already mentioned the large automotive orders that we booked in Q2, as well as the consolidation impact from BVS Automation and INGECAR. These were the main drivers for the 16% growth in Q2 year-on-year. Especially the development in automotive, where customers are securing capacities, is remarkable and largely disconnected from current production levels. And the pipeline continues to look solid also for Q3. On slide eight, we see the geographical distribution of order intake. The Americas and Europe were quite stable, and Germany grew strongly due to the large order we received in Q1. It is interesting to note that the automotive demand is geographically well distributed. We received four large orders in the first half year, and they were distributed across the major markets. Germany, Europe, North America, and China. This clearly reflects the strong global setup of our operations close to our customer base. Let's continue with a quick update on sustainability. On slide seven, we can see our progress with the reduction of our own CO2 emissions. They were down by 51% in 2023 compared to the base year of 2019. Main drivers were the switch to green energy purchases, the buildup of own photovoltaic systems, and the modernization of our heating systems. We also revised our car policy to increase the share of emission-free vehicles. And there's more to come. In 2024, we will focus on the conversion to alternative sustainable heating solutions. We will also review our climate strategy and prepare an update for 2025. All the measures we have implemented and the improved level in reporting transparency are also reflected in our ESG ratings. On slide 10, we can see an overview of a number of important ESG ratings and how our company was rated over the past two years. The improvement is clearly visible. We are especially proud of our prime rating at ISS ESG and the platinum medal we received at Ecovados. Our ambition is to be among the best rated companies in our industry for all key ESG ratings. On slide 11, we would like to refer you to our recent sustainability report 2023. It was published on June 20th and includes all the details about our actions and performance in the area of sustainability. Let's have a look at our most recent M&A activity on slide 12. On July 1st, we closed the divestment of Agamco, a subsidiary belonging to industrial automation systems that supply systems for filling refrigerators, air conditioning systems, and heat pumps. Last year's revenues were about 45 million euros, and Agamco's EV stands at 47 million euros. In Q2, we incurred expenses in the order of a small single-digit million euros amount related to the sales. The cash inflow and book profit are not included in the H1 results, but will be reflected in Q3. We are happy with the successful sale. It contributes to our goal to reduce complexity and improve our business focus. A much larger lever to increase our business focus is with the strategic initiative that we announced in early June. Going forward, we will concentrate our activities more on the core activity of automating production processes with a special focus on sustainability. At the same time, we streamline our portfolio and set up and reduce the number of divisions from five to three. This is shown on slide 13. Specifically, we will combine our paint and final assembly systems and application technology divisions under the new division automotive. Integration work has started and the new structure will become effective on January 1st, 2025. In parallel, we are conducting a strategic review of the environmental business of our clean technology systems division, which also includes a potential sale. We are currently preparing for this review. A decision has not yet been taken, and we will keep you informed about important developments. The lithium ion battery business will remain with the Dürer Group in any case and will become part of the new industrial automation division that includes the balancing and tooling business as well as production automation systems. As we already talked about our plans in more detail in early June, I would just like to highlight a couple of key themes. On slide 14, we can see the rationale for the combination of the activities of pain and final center systems and application technology under one division automotive. On the one hand, we are further enhancing our customer proposition by combining the best technologies and offering a one-stop shop for the most sustainable solutions in the industry. On the other hand, we make use of sales and margin opportunities by realizing synergies in product development and sales, as well as project execution and service. We are convinced that this is the right way to further drive our value before volume strategy. The rationale for reviewing options for the environmental business of clean technology systems is described on slide 15. This business has grown significantly over the past years and shows a strong operational performance. It is the market leader in thermal oxidation and there is also further growth potentials beyond the core business in adjacent markets. We believe that it is a good time to review whether we are still the best owner or whether there are other options that can further accelerate the development of this business in a more focused way. In the end, we want to create a win-win situation for all stakeholders, as described on slide 60. We focus our business on our core competency of automation for production processes with leading efficiency and quality, which provides interesting growth and margin opportunities going forward. At the same time, we enhance our customer proposition in automotive by creating a one-stop offering of services and solutions based on the best technologies in the market. For the environmental business, we're looking for the optimal route to leverage growth opportunities. And we sharpen our profile towards the capital markets with a clear commitment to long-term value creation for our shareholders. This is one of the largest transformation projects in the history of Dürer, and we are very excited about the possibilities that we can unlock. Now let's have a look at the divisional development. We start with paint and final assembly systems on slide 18. Order intake in Q2 virtually remained at Q1's high level of around 500 million euros. As already mentioned, we received several large orders and customers are increasingly securing capacities for mid to long-term projects. The project pipeline looks solid and we see good chances of a good order intake also in Q3. Sales grew sequentially and year on year, we expect a further acceleration in half two. Looking at the EBIT margin before extraordinary effects, we can see a strong improvement in Q2. This is driven by strong service business and by increased cross margins in the equipment business due to our value before volume strategy. All in all, paint and final assembly systems is on a good track to reach the margin target of at least 6%. Let's turn to application technology on slide 19. Order intake continued to be strong and reached a new record level of 480 million euros in H1. Sales growth accelerated in Q2, and we expect further growth in H2. The service business continues to perform very well and is the major driver for profitability. EBIT before extraordinary effects grew significantly year on year, and the margin is already at the target level for the full year. The strong business development of application technology is a clear highlight. Next is clean technology systems on slide 20. The order intake improved sequentially driven by Europe, but it is still below the very strong H1 of last year. The pipeline looks good and still includes the larger battery coding project that we were talking about already during our last call. Sales revenue also grew sequentially driven by Europe and USA. The strong margin performance continued in Q2, even reaching close to 10% before extraordinary effects. Main drivers are high margin projects in execution and a very strong service business. We are very happy with the performance of this business and the strong project execution. Let's move on to slide 21 and the industrial automation systems divisions. Incoming orders and sales of Q2 were supported by the consolidation of BBS automation. Order intake in Q2 was still slow due to the delays and demand for e-mobility customers or from e-mobility customers. However, we received the first order from an automotive OEM where we realized synergies of BBS automation and team technique to provide a complete production line including assembly and testing. In addition, order intake in July was very good. and we received a larger order from a pharma customer who chose us also due to the increased size of our operations. Sales growth only included a small share of organic growth due to the delays in order intake. The EBIT margin before extraordinary effect improved year on year when we look at H1. However, there is still room for improvement. On the other hand, we still had projects with lower margins On the one hand, we still have projects with lower margins in execution. We also see some underutilization in North America and Western Europe due to the delays in order intake. On the other hand, the business in Asia is running very well. We are confident about the prospects of the business in sales and margins and focus on realizing synergies on the sales and cost side. In Q2, we decided to do a small adjustment of capacities in Germany at Teamtechnik that is also reflected in the extraordinary effects. The international cooperation within production automation systems is developing well and allows us to leverage cost advantages. Last but not least, let's take a look at HOMAG on slide 22. Order intake was stable at the level that we assumed in our guidance. The overall market environment has not changed yet. We still see weakness, especially in the single machine market. However, the service business continues to do well. The year-on-year decline in sales revenues in Q2 was similar to Q1 and within our expectations. The EBIT margin before extraordinary effects has stabilized at 3%. The capacity adjustment program was completed successfully without forced redundancies. The voluntary leave program was adopted and natural fluctuation helped in addition. As such, we will see the targeted reduction of 600 headcounts worldwide by the end of the year and are fully on track to reach the 25 million euro cost reduction in 2024 and another 25 million euros on top. So in total, 50 million euros cost reduction 2025 compared to 2023. With the reduced capacities, we have increased our resilience and are well positioned to benefit from a demand recovery once it occurs. Now let's move on to the service business on slide 23. The absolute sales volume in Q2 was flat quarter on quarter at a solid level. The share of total revenues declined due to the growing equipment business. This was partly compensated on the earnings side by an improvement in service margins. We continue to focus on growing our service business as an important factor to improve and stabilize our overall margin. And now, Dietmar, your turn for the financials.

Thank you, Jochen, and a warm welcome also from my side. Let's take, first of all, a quick look at the financial overview on slide 25. We had a strong operational development and cash flow in Q2 and the first half. Jochen already mentioned the higher extraordinary effect in Q2 due to expenses related to the sale of Agramco and capacity adjustments at production automation systems. In total, this sums up to a single digit million euro amount. We expect to see an opposite effect in Q3 when the book profit of the Agramco sale is included with a size of around 10 million euro. Let's go through the most important KPIs on the following slides. On slide 26, we can see the revenue development over the last quarters. The typical seasonal pattern is visible when you look at 2023, and we see a similar picture in 2024. Sales revenues grew quarter on quarter and year on year in Q2. Overall, we are on track to reach the guidance for the full year and expect further revenue growth in the coming quarters. Looking at the geographical distribution, we see that China continued to lose share that was partially made up by Europe and the rest of Asia. Now let's move to EBIT on slide 27. Again, you can see the seasonal development in 2023. EBIT before extraordinary effects and the margin improved sequentially in Q2 2024. This was mainly driven by a higher gross profit in two automotive divisions as well as in clean technology systems. Looking at the EBIT bridge, we can see the higher extraordinary effects in H1 that we already discussed. We see further margin potential in H2 driven by higher margin projects, increasing sales, and our cost savings. On slide 28, we can see the free cash flow development. We were able to stabilize free cash flow in the seasonally weaker Q2. High prepayments due to the strong order intake, but also a further reduction of inventories were the key success factors to reach 44 million euro free cash flow in the first half of the year. In the second half, we expect a majority of the cash outflow from redundancy payments at HOMAC. but at the same time a solid business development. As such, we are well on track to reach our guidance of €0 to €50 million for the full year. The contribution from net working capital to free cash flow can be seen on slide 29. Net working capital declined strongly to €480 million at the end of Q2. The contract liabilities increased significantly due to the high prepayments and overcompensated effects from higher receivables and a decline in trade payables. In addition, we could further reduce inventories and contract assets. Consequently, days working capital dropped below the target range of 40 to 50 days. I'm very pleased with the development of net working capital, and we will remain disciplined in its management. Now let's turn to slide 30 and look at the net financial debt. It increased to 533 million euro, which was mainly due to the dividend payment of 49 million euro in May. Important to note is that the net debt at the end of Q2 does not include the proceeds from the Agramco sale as the closing was in early July. The proceeds will have a reducing effect on net debt in Q3. With a leverage of 1.6 times, we are well below the limit of two times that we have set ourselves, and we are on track to reach our guidance for 2024. Our liquidity headroom is very comfortable, as you can see on slide 31. The maturity profile shows the status of end of June. In July, we repaid Schulzstein maturities of €75 million. And in addition, we already repaid two Schulzstein tranches in July that were only due in 2025 with a volume of €60 million. Our maturity profile remains very well balanced over the next years. With this view from the financial side, I hand back to Jochen for the outlook.

Thank you very much, Dietmar. Let's start with a quick look at the fundamental demand drivers for our business on slide 33. Particularly, the first one has once again strongly supported order intake in Q2. There are still a lot of old paint jobs around, and therefore, we see a solid pipeline of refurbishment projects. We believe that we can provide highest efficiency to our customers as we can optimize the complete setup of a paint shop, including robotics, energy management, and intelligent software applications. Customers with ambitious goals in the area of sustainability are increasingly reserving capacities with us early on for mid- to long-term projects. The second demand driver, that means enabling sustainable products, seems to have slowed down a bit when looking at the EV production numbers and housing starts. However, we are not so much dependent on current production levels and believe that the fundamental transformation towards a carbon-neutral society goes on, and so will investments in this area. In the automation area, we have now reached a critical mass, and have interesting discussions with customers regarding potential projects in all areas, automotive, medtech, and consumer. First synergies already realizing, as I have pointed out. Let's look at our guidance for 2024 on slide 34. There is no change to the targets compared to our Q1 presentation in May. However, after the strong first half year in order intake, we are now confident that we can reach the upper end of the order intake guidance. Our focus this year remains on margins and cash flow. On slide 35, we can see the breakdown of the guidance by divisions. Here, we have made two adjustments that have no effect on the overall guidance for the group. We have increased the guidance for the EBIT margin before extraordinary effects for clean technology systems from a range of 6% to 7% to 7% to 8%. The background is the strong margin performance that we have seen in the first half year. At the Industrial Automation Systems Division, we reduced the guidance for sales by 50 million from 820 to 920, to 770 to 870 million euros. In addition, we lowered the target for the EBIT margin before extraordinary effects from 7% to 8% to a range of 6.5% to 7.5%. The reason for the adjustment is the delayed order intake in the first half. As mentioned, we have experienced a pickup in orders in July, and the pipeline of potential projects is solid. Our unchanged mid-cycle targets for sales EBIT margin before extraordinary effects and ROCE are shown on slide 36. Now, let's summarize on slide 38. We again experienced a strong order intake in Q2 driven by automotive customers that are securing capacities. Revenue growth is on track. The weakness at HOMAC was more than compensated by organic growth in the other divisions and the consolidation of BBS automation. The EBIT margin before extraordinary effects improved, especially driven by application technology and clean technology systems. We had temporarily higher extraordinary effects that will be reversed in Q3 with the book profits from the Agramco sale. Free cash flow was solid. And finally, we confirm our guidance for 2024. Thank you very much for your attention. Now we are very happy to answer any questions you might have.

Ladies and gentlemen, if you would like to ask a question, please press 9 and star on your telephone keypad. In case you wish to withdraw your question, press 9 and star a second time. Please press now nine and star to raise your questions. And we have one question from Nikita Lal, Deutsche Bank. Please go ahead.

Yeah, hi, this is Nikita from Deutsche Bank. Thank you for taking my question. I have actually two. So the first one is on your guidance towards the upper end of the order intake guidance. I wanted to ask you if you can say which segments are the key drivers here Or do you think that all segments will help you appropriately? And then secondly, you are guiding that your H2 margin will be better than your H1 margin. Can you maybe elaborate what are the building blocks here? Thank you.

Thank you for the question. Other questions? On the first one, um the driver for reaching the the upper end of the guidance continues to be automotive this is really if you look at the half one where we are already if you just look at for example pain and final assembly systems we're pretty close to already two-thirds of our regional midpoint if you will and as we continue to see a good pipeline In the end, if we reach really, and this is our expectation at the moment, that we get close to the upper end of the order intake guidance, this will be mainly driven by automotive. On your second question, why is H2 better than H1? This is very much also volume driven. We accelerate sales further in H2, which is Our decisionality, we always have, and consequently have better absorption, and this will then, in the end, bring a better half-two EBIT performance than in H1 overall.

Okay, and the next question comes from Peter Reuchenach, Eichenacher Baader Bank. Please go ahead.

Yes, hello. Firstly, on the paint and final assembly systems or the backlog. So from a mathematical point of view, I would have expected it should be 100 million euro higher. So have you done some outbooking here?

Thank you, Peter. I'm just looking over to Dietmar. First of all, I can tell you we did not have de-booked, that we have not de-booked something. Maybe he has a good answer for your question, Dietmar?

Not really, because there was no cancellation that appeared, so we are now at over 2 billion euros of other intake, or other book, not other intake, sorry.

Can you explain us your math behind the 100 million gap?

Yes. So at the year end, 2023, we had an order backlog of 1.74 billion. Then in the first half of the year, the order intake was 400 million euros higher than sales. So this would add up 400 million euros. And then I would come to around 2.15 billion or something like that backlog.

The calculation is right, but we need to double check, or we need to check, Peter. Actually, I said there was no cancellation. Any change in allocation of business? No. Between the division levels or not. Okay. At least not that I'm aware.

So the good news is no debugging. The bad news is we will have to explain. Okay.

Then on hallmark. So you mentioned you are progressing quite well with restructuring and the decrease in the number of employees. How is your view generally if there is some restructuring success in many times a negative effect on the motivation of people on efficiency? Have you observed anything like that at HOMAG, or do you fear that in the second half of the year something like that will come up?

You know, it's very difficult to say, Peter, for each individual. My impression is Once things are clear and fortunately, we have now announced internally that the program that we call WAVE internally has been completed as we have reached our reduction target. The talks that I have with employees is rather, of course, everybody is looking at when will Audente come back. On the other hand, It's a good feeling to say, okay, the program is now over. People have signed agreements. Not everybody has gone yet who is concerned. But on the other hand, everybody else now knows it's going on. So my impression is now it's probably rather an improvement in the sentiment from mid of last year as people now have clarity.

Okay, thank you. Pasha?

At the moment, there seem to be no further questions. If you would like to ask a question, please press 9 and star on your telephone keypad. And we have one more question coming from Christian Kors, Warburg Research. Please go ahead with your question.

Yes, hello. Good afternoon. Also from my side, a couple of questions from me. First, in industrial automation, all the Intake has been a bit below your, I assume, internal expectations. So in case the market remains muted and the current pickup is more of a short-term lift, can you maintain a value before volume approach in industrial automation in times of muted demand? That's question number one. And question number two on your simplification strategy, which I welcome a lot. Do you have an internal time?

Oh, I think he just dropped us. So I'm sorry we lost our questionnaire.

Questions still there?

I think his line dropped off, so...

Okay, I might still, at least I can suspect the end of the second question. I'm trying to answer it. If not, we can give it a further try. The first one, order intake value before volume in pairs. I mean, the headline of value before volume was mainly coming from our automotive activities, especially PFS, as we had times where We had lower margin orders in the book and wanted to improve, which we've done. So this is not so much applying for production automation systems where we typically have pretty good margins. So the issue is more whether the orders are awarded or not and projects are delayed rather than us seeing a much fiercer competition. I don't think that that is a very critical item at this point. On the other hand, we see, as we described, a lot of projects or some projects being delayed on the automotive side. But as I mentioned, we also booked a very nice MedTech order, and there will be more – or pharma order – more to come this year. We're pushing more into life science and – We also assume that the e-mobility orders, even though they might be delayed a little bit, will come. On our merge of the two divisions, PFS and APT, we have not defined at this point a hard synergy target. This will come as we progress in in this project. Not sure whether Christian is back meanwhile. Yes, he is. So I suspect... Hello, can you hear me? Did you hear me answering your questions or were you still absent, Christian?

I'm back in the line. I do not know whether you can hear me now. We can hear you clearly. We don't know whether you heard the answers. I think I've heard most of the parts. Sorry, I was kicked out of the line. Thank you very much already for the two answers. I had also a third question which I wanted to raise. That was in your guidance with regard to the divisional targets. For APP, you're eyeing 650 million order intake for the full year. After H1, you achieved already 480 million. Are you just conservative, or is there any downturn to be expected in H2?

Yeah, sorry to say we don't see a downturn at this point. So conservative, I think, would pretty much be the right way to call it, or very conservative.

Okay, understood.

Thank you.

Pleasure.

And now we have one more question coming from Philippe Ron-Bernstein. Please start with your question.

Good afternoon, gentlemen. Thanks for taking my questions. So I have actually a couple. The first one is on the large automotive orders that you mentioned for Q2, saying you had like two large automotive orders worth in the triple-digit euro-million amount. Would you mind specifying a little bit the size for us? It's just like to understand stripping out these orders, how like the underlying run rate was. And then the second question is, it's coming back a little bit on the question on APT's order intake guidance for the year. I understand that you have like a conservative stance, especially right now. My question is a more practical one. Since you tweaked your divisional assumptions regarding the margins for IAS and also for CTS, why not also tweak the order intake guidance for the different divisions, even if we leave the total order intake guidance unchanged for the group? Thank you.

Thank you, Philipp. On the two large orders, the triple digit orders in Q2, they were both between 100 and 200 million euros. So one may be closer to the 100, the other one closer to the 200, but both within that range. I hope that helps a little bit. On the ABG guidance, you know, Fortunately, I would say individual guidances might not be as relevant as the group guidance. However, you know, especially on the automotive side, you never know what's going to happen. And whether you book an order in December or in January can make a big difference. So we discussed this. And for the time being, we said, we leave as is because, you know, we don't perfectly know. The only thing we know is that the pipeline remains solid at this point.

Yeah, perfect. And I understand definitely that if we look at the guidance for automotive, where it's basically like actually no question that the stand is really conservative, is APT, while PFS might be also a little bit more affected by your value before volume strategy. Could you share with us a little bit as well if you see any need to become way more selective for orders in that environment, or whether the pipeline that you see is actually a healthy one when it comes to margin potential?

Yeah. We are always, I mean, even if it doesn't look like in half one, even in half one, we've been selective. So all the orders that we've booked are good orders and we will continue to do so. However, we even now, we're carefully watching capacities and where to best place them rather than, you know, just I mean, the two go together, capacity versus margin. And let's see how the second half of the year turns out. You've seen last year that the second half had been weaker than the first one, which we also expect for this year. Because if you do the math, $5 billion is the upper end of the guidance, minus $2.8 for the first half. would technically mean 2.2 at best. Let's see where we end out. We just believe it's a little bit early in this current environment to do any change.

Okay, good. And maybe like a quick follow-up a little bit as well on Peter's question regarding the delta you have between your order book and the calculations that one could make looking at the order intake and so on. Did you have any massive swings in the different currencies you operate in that could also explain this kind of shortfall with regard to the order book? Or is it more like, let's say, another kind of reason that you are going to look into and then probably come with an answer?

No significant foreign exchange impact, Philippe, from my point of view. We need to look into this.

At the end of the day, we'll probably make you a good offer to join the company to understand our financials so well.

Yeah. Thank you very much. I'm back in the queue.

And we have one more question coming from Holger Schmidt, DZ Bank. Please go ahead.

Hi, good afternoon, everyone. Thanks for taking my questions. I have two. The first one is, could you give us an update on the development of your battery business? We have seen a couple of news around delays of larger projects. So where do we stand now? And the second one is, during the presentation, you mentioned that there is high demand out of the auto industry. I mean, there seems to be a disconnect because the overall market environment for the auto industry has deteriorated. What is really driving the eagerness of customers to secure capacity now?

Thank you, Holger. On the battery business, we've had a few smaller orders, and we are now looking at one larger order, which would be a very relevant order for us, where we continue to be very positive. It's just been... delayed from Q2 now into Q3. If we booked that one, that would be really a big change, and we're confident. Drivers in automotive is really the need for the conversion of the facilities of our customers into sustainable facilities, and this in combination of the production for electric vehicles. And this is somehow connected at least in two ways. First of all, I've just been visiting a customer in Europe where we are starting up completely a plant or a paint shop where the production, meaning the painting of the vehicle, will be completely CO2 neutral. and it's a plant that is for electric vehicles only. The customer, first of all, needs to fulfill his sustainability target. Second, the customer knows that it's only sustainable as a business to produce electric vehicles, meaning sustainable vehicles, in a sustainable plant. And this is what drives a lot of business. Plus, Also, some technical demands in terms of the production of electric vehicles are different, creating additional brownfield business for us. And this is what currently really drives the business, and it will do so looking forward.

Okay.

Might there be orders where we – yeah, sorry. Yeah. Yeah, thank you.

At the moment, there are no more questions. If you would like to ask a question, please press 9 and star on your telephone keypad. There are no more questions from the audience, so a hand back for closing remarks to Mr. Schaller. Please go ahead.

Yeah, thank you very much. Thanks for your interest in your questions, ladies and gentlemen. In case of any further questions, please do not hesitate to contact me or the installation team. And other than that, we look forward to seeing you here at a number of conferences in the upcoming weeks, especially also in September. So if you're interested to meet with us, check with us in our calendar. And otherwise, we wish you a nice summer break in case this is still in front of you.

If I may add just, Andreas, you will feedback the answer to this very good question to the audience. I'm curious as well. So then also from our side, Dietmar, enjoy your summertime and hope to be in touch soon.

Thank you very much and bye-bye.

All the best. Bye-bye.