Iochpe-Maxion Sa S/Adr

In our call today for the Q&A, we have Mr. Peter Klinker, CEO, and Mr. Renato Salum, CFO. We would like to inform that this video conference is being recorded and is going to be made available in our Relations with Investors website with the company, along with the presentation. We would like to highlight that Mr. Peter is going to make this presentation in English, and we have simultaneous translation for Portuguese and English. They can be accessed in the small globe at the bottom of your page that you can see interpretation at the lower part of your screen. By clicking on that icon, you will see three options, original audio, Portuguese and English. Please select the one that best suits your needs. For the Q&A, the Q&A session, we would like to ask you to use the Q&A button on the lower part of your screen and we are going to ask you to make your questions to ask your questions so if you can activate your microphone you will see that on screen and remember that part of these questions will be answered in english so we kindly ask you to use the translation tool in case you need it we would like to make sure that apart from declarations that can be made during the conferences regarding the perspectives of business in the company projects and operational goals they are Assumptions and premises as well as information that are available for the company. Future considerations are not guarantees for performance. They involve risks, performance and assumptions because they were talking about different cultures and circumstances that may come to happen or not. I would like to call Mr. Peter Klinkers. Mr. Peter, if you will. Go ahead, sir.

Hello, good morning to everybody. Good afternoon to everybody here in Belgium, where we're meeting with the global team to talk about the future. But we're taking a break here to do this conference and talk a little bit about the recent past, the second quarter for Jospeh Maxion. But also at the end of the presentation, as you will see in a few moments, we will try to take you with us a little bit into the future. Let's talk about what has been happening in the second quarter. We go to the next slide. First of all, the executive overview. I think from what you could see maybe already from our numbers, again, we believe that we have been able to show a pretty resilient performance. We were disciplined on some of the cost savings that we were targeting. We realized them and I think it will come back more often in this presentation and maybe in other presentations as well, but North America clearly is recovering, that is supporting Our CV performance there and at the same time we are seeing some strong aluminum wheel performance in North America that has been helping our performance that was as we call resilient. Financial discipline, shareholder focus, you know, I think you will see from the numbers, we believe we have a solid liquidity and on top of that, we are showing a lower net debt, which should reinforce our financial flexibility and the outlook for the mid and the long term for our shareholders. and you know last but not least we do have not only resilience we also see some gross drivers and we will talk about it a little bit more at the end of this presentation but for us clearly Asia is outperforming we've talked about that a little bit also in prior presentations but we start to see it more and more now and within Asia of course for us India is a gross engine in all the segments that were president there and so I'm happy to talk about that a little bit more at the end of the presentation. It's not only Asia or India, also Brazil LV is strong and very strong for Maxion and as I said, North American truck trending upwards is very helpful as well. We go to the next slide. Look a little bit more in detail on the market. It's really different between LV and CV, not only right now, but also if we look at the immediate future, let's say the rest of this year or next year or even the year after that, it's very little growth on the LV side. And on top of that, Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum In the next one, two, three years. Same time, commercial vehicles is a positive market. We see North America coming back. We believe Europe will be stronger the next two years than what we've seen this year or the last two years. India will be will be growing and we believe Brazil is not so favorable right now but should be stabilizing second half of this year next year and so overall the truck market for us we believe is showing a very positive outlook we go to the next slide Talk a little bit, coming back to the second quarter, talk a little bit about the highlights from a financial KPIs point of view. How are we doing in that market? And so our net revenue around 4 billion in the second quarter, and that's a little bit lower than what we saw last year, but we all know FX, the REI has been appreciating to many other www.patreon.com.br Gross profit, not a bad number, 12.1%, but still having some impact from lower fixed cost absorption in markets that are recovering like North America. Also suffering a little bit still from the temporary raw material pass-through timing effects. And so we believe whatever is a negative for us there in the first half of the year, which it clearly is, that should be a positive in the second half of the year for our company. We look at EBITDA, you can see negative, it's not as good as it was last year, the second quarter, but keep in mind North America was a lot better at that time and it's coming back. You can see positive, it's a percent better than in the first quarter. Overall, we believe this is a very decent number and a good base for us to build on for the next coming quarters and years. You look at the leverage, we have been able to reduce net debt and that's a very positive one for our company in the second quarter of 2026. Our long-term multiple on the EBITDA side is still not there where we We go to the next slide. We look at our revenue by product. It's a little bit still the same number as what you guys saw in prior presentations where still our components unit is lagging behind the past performance that I had from a percentage revenue within the company. We believe this will come back to prior numbers pretty quickly now, but you can still see in the first half Even in the second quarter, lagging a little bit behind the normal 22-23%, maybe even getting up to 24-25% that components has in the total of Jospeh Maxion. That lagging behind has then been made up by wheels, especially aluminum wheels was strong again and has been offsetting the revenue drop that we saw year over year in components. You go to the next slide. We look at that in a little bit more detail by customer and even though the numbers are getting closer than what we saw in prior presentations where we saw truck going down and Pascal going up, still some truck being down quarter, this year quarter versus last year quarter. I would say not so much anymore. We still see past car revenues. Some of the big customers that we have, they are still increasing revenue this year quarter two versus last year quarter two. You look at a company like Stellantis or you look at Toyota, it's clear that we're gaining some momentum there. And so if you combine that with the truck Coming back, which is what we see happening, and what we also foresee for the next coming two years, that could be a good story. We go to the next slide. We look a little bit more in the regions in the next four slides. We look at South America. I would say it's a very different picture between LV and CV. In CV, the market clearly is down, and so are numbers. It's not huge numbers for us if we compare to the rest of the world, but still, this is not helpful. And so when the Brazilian market comes back and stabilizes, We really have some momentum on the light vehicle market where the market is strong and we see momentum with customers, both traditional customers as well as new customers that are coming into the market. We go to North America on the next slide. Our revenue is still slightly down, but it's coming back. That's what we say. And so this is a combination of our aluminum wheels doing very well in North America. We have some new business winds. We're doing good with margin there as well. But also we see this truck market clearly coming back more in June than we had in April. But during the quarter we saw improvements there and that is also our expectation for the rest of this year. We go to the next region, EMEA. We see a contraction of our revenue. And so Europe, I think, is a more complicated story, especially from an LLV point of view. Now, the good thing is for Maxion, we are strong in Europe. We are a very competitive company. We have had some market share gains in the past and we're still profiting from that, but we cannot have market shares every quarter. but we're okay in our plans but Europe is a little bit tougher environment from an LV point of view. Truck also was not great but here we continue to profit from our more recent market share gains and we also believe that will be the case during the rest of the year and then in the out years, 2027, 2028, let's see how the market develops but there is more positive A more positive tone that we hear in the market than what we've been hearing during the last two years. And so if that happens, when that happens, Maxion will be ready to fully profit from that increasing trend in the market. We go to Asia on the next slide. Really, this is a gross area for Maxion. And of course, as you know, a major region where we are within Asia for us is India, where we are making passenger cars, steel wheels, passenger car, aluminum wheels, and track wheels. and so what we see is the market is doing well and Maxion is actually doing a little bit better than the market and again i've been talking about we've been talking about it in the prior calls and i look forward to talk about this in not only on the next slides but also on some of the next uh next calls because we believe this can really be a very good story for uh for our operations in india and for our company overall let's go to uh next slide Gross profit, gross margin, we talked about it. It's down, but if you look at the first half of the year here now, we're very close to where we were last year. Keep in mind, last year we had that North American track market that was very significantly better overall in the first half than what it was this year. So keeping this margin close to where we were last year in the first half for us is a good outcome. And again, good basis for the rest of the year. You look at the next slide. We talk about EBITDA. It's pretty much the same story. As I said in the beginning, we are lower in the second quarter than where we were last year, but we believe that 10.4% is a good outcome for us in this quarter. If you look at the first half of the year, similar story than what I said on the gross profit. We're very close to last year with the expectation and the hope that the second half of the year for us will be better. Go to the next slide. Net income, not a bad story at all. I think the number is still too low, but we're happy with the outcome of 87 million in the second quarter and the 90 million as a base for the first half going into the second half of the year. And so this is a good base for us to have a decent year from a net income point of view. Go to the next slide, Ina. Looking at our investments now, these are meaningfully lower than what we were doing in the first half of last year, but this is mainly timing. We have been trying to manage timing for investments over the whole year since we believe our earnings will be a little bit better in the second half of the year than the first half of the year. We've also been trying to move We believe overall we will be in line with our yearly targets from a capital expenditures point of view, but with a managed timing between the first half of the year and the second half of the year. Leverage pretty stable I would say quarter over quarter and again we are decreasing our net debt and we are looking for the long-term multiple on the EBITDA side to pick up In the coming months, in the coming years, of course, and that combination should drive our leverage down to be meaningfully lower than what we're looking at right now, step by step.

We go to the next slide.

We look at a gross debt. There is new news here. And so on the top right side, you see how our maturity looked before we refinanced some of our liabilities, a good part of our liabilities. We had some maturities in 2028 and the team was able to refinance those and to extend the maturity. Abreu, Bruno Zarella, Renato Jorge Salum With our liquidity, I would say this company certainly is in a stable position from a financial point of view. We go to the next slide. Talk a little bit more, as I said in the beginning, besides all the financials, about some of the projects that we are doing. And we've been talking quite a bit over time about our investments in Mexico for structural components, the rails and the frames that we supply to our North American truck customers. On the top right there, you see our new facility. We call a plantry. It's a new facility. We are starting to produce product in this plant. And so, of course, that's still testing right now, but we're getting ready to serve that North American market that is coming back from the very low numbers that we saw in the beginning of this and the last year and the beginning of this year. We are getting ready to serve our customers in the second half of 2026 with volume from this plan. And so I think that's a major good news for our operation, for our company. And so also, if you look on the 2027 projections there, you look at the 2028 projections there, it's a very good thing to have the plant. We will need it. As we thought when we made the investment and we're looking forward to make the best use of it from a supporting our customers volume point of view but also from a productivity point of view because of course the equipment that we put in here is the state of the art is the latest of the latest and so we look forward to a good situation for this operation that we have established in Mexico Castaños. You go to the next slide, Aina. Staying with components, but moving to Brazil. This is our beautiful Cruzeiro location that you see in the middle. And you see some of our products on the left and on the right. But I think the main news here that we wanted to share is that we did win meaningful new business, very significant new business. And we're co-developing a product with a very big pickup customer that we serve, have been serving and will be serving from Abreu, Bruno Zarella, Renato Jorge Salum We're actually starting that already at the end of 2026, and we will run this throughout 2027, 2028, and it will be a very good thing to secure the short and mid-term future of Cordero. Looking at the other side of the world, I will have two slides on India Truck. You could have more slides on India, but we have one for truck and one for Pascal Aluminum Wheels. This is part of our truck wheel plant that you see in the middle. And we have decided to expand our capacity in this plant to be serving already sold www.patreon.com.br Let's do 10 small ones. We're not going to do all the 10 small ones in one quarter or not even in one year. But we are opening up the drawer and picking out the best projects, the projects that have the highest priority. And we are starting to execute on those. And so this one, an India truck. is a very good example of that. If we go to the next slide, we look again at India, we look at our light vehicle, aluminum wheel facility in Ked City, Pune, Maharashtra. We are expanding the new plant. I still call it a new plant, but new plant in the meantime is 10 years old. But this is the first expansion after Thank you very much. We go to the last one in this row, in South Africa. We have a beautiful plant over there, but there's a couple of things happening over there. We have one meaningful new business, and so we're launching, I think it's a total number of about 27 new wheels. Some have very low volume, some have a little bit higher volume, but 27 new wheels over the next 18 months in South Africa, which is fantastic. And at the same time, we're putting in place Abreu, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum And so taking care of this plant, even though it's a small facility, it's a very good story that I wanted to share with you guys as one of those projects where we say these are more digestible and we're making use of our existing facilities instead of building new facilities. We go to the next slide. Trying to wrap it up. If I look at the 2026 second quarter, I think we talked enough about the global resilience and discipline. That was the case. It is the case. I think we've delivered another quarter. We've shown another quarter where we can say we were resilient. At the same time, resilience is nice, but we do want to have some growth, even if the LV market Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum www.flavio.com What we get, but in LV, in that strong market, we are having momentum with customers, good momentum with customers. In Europe, the market is more challenging, but the good thing for us is we are a very competitive company in Europe, and so we will manage our way through that, even in LV, which is more challenging than CV. And then Asia, Asia is growing. India is growing more than average in Asia, and Max in Asia is growing more than average. In India. And so all of that I would say in the most important regions where we operate I would say the glass is more than half full. Overall, of course, we do that in order to deliver value. And I think by keeping our strong liquidity, keeping the cost discipline, which is definitely our target, generating cash and lowering our debt, I think we have a plan to make sure that our company can thrive. And with that, I would like to open it up for questions and answers through Rodrigo.

So we are going to start with Q&A right now, okay? We kindly ask you to ask your questions at once and wait for the answers from the company. We would like to ask you to send your questions with the Q&A button and by standard, you will have your names called and then you will have a request, send your request to open your microphone. Our first question is from Luisa Mussi from Safra. Luisa, if you will, go ahead.

Okay, Luisa, I will answer the first question and then Renato Salum will take the second question. So on the revenue in Europe, this can vary quarter by quarter depending on the mix. I would not be... www.patreon.com.nz But I think our position in that market, whatever it will be, is pretty strong. So I would look at that over a longer period of time instead of just one quarter. And as I said, on the commercial vehicle side, we're actually outperforming the market. And my expectation is that we will be able to continue to do that for some more time. Is that okay for the first question? Thank you.

Renato.

Hello, Luisa. Good morning. Thank you for your question. Well, by starting with the working capital, one of your questions, it's important to mention that since 2023, the company has been working the working capital ratio below 3%. Once again, we close this quarter with a ratio around 2.4% in March. If compared to June, I apologize his words, but if you think about the average on the second quarter, we have 12.7% in the cash flow that's been accumulated from the first quarter. We also see easily in our financial reports, especially in the cash flow, indirect cash flow that our and many more. We are still focusing on managing inventory as well as maintaining sustainable positions for our suppliers to preserve The CAPEX and the cash flow. I think that when we talk about cash flow and when we look back over how much has been generated in operational activities in the company, we can truly see in the first semester 454 million compared to a consumption of 3 million reais in the same period last year. And also this improvement was supported by the capital flow and the consumption at the end of the day. I mean, it's about the inventory, having the lower purchase of inventory and good quality of our suppliers. So we consider that helped the company regarding and keeping our leverage. Our leverage closes 2.52%, just like Pieter mentioned, But of course, if we can add the polymetal that ends up being consolidated from this moment within our financial reports, and if it weren't for this event, we would have the same leverage that we've had in the previous quarter. Regarding liability and management, that's an important point. In July, We've had a very important activity in the assets, in the liabilities of the company, actually. And then we have like a loan in two currencies, the first in euros, 123 million euros to the cost of Horibor and 2.55%. So in other words, in this moment, if we had like a simple conversion, we would have around 5.04% every year. and we close 180 million dollars to so far more than 275 percent that it's equivalent to 6.51 so oh and also we had a debenture we used to have a debenture the 17th debenture of the company 400 million reais It's CDI, we had 160 and at the end of the day we end up using part of our own cash. Apart from these lines that we had to bring to reinforce our cash flow. And we have the total rescuing of our bond on July 24th. So, to help you out with the projection, At the end of the day, we are going to have, I would say, 73 million impact on financial expenses. And 41 million reais would be additional interest because we're coming out from a bond of 3.5 and having these two instruments, if we went to the market in a moment that we've done research, we saw something about like high eight. So we understand that the process that we decided to follow brings benefits to the company. And as we close these bonds in these last years, we can accelerate indexation of the deaths, of the cost for capturing that bond. And especially when we talk about like this, there was a prize, a claim that was 0.62% that was paid on the and Edupa. So we have this whole liability management that has been finished. Regarding cash flow, we don't have a significant impact this year because even though we can allow for the R$6 million in our interest payment, we have the online financial results that we have R$40 million in cash flow. So we've had an impact of R$6 million but negative in our cash flow. And for 2027, apart from what we used to have in the body, that the maturity would be 28, we have an adding of 71 million reais if we consider the rates that we have up to now on a year basis. So even though we have more costs of the previous debt, the structure was more efficient, different from like new emissions that we had available at that moment. and at the same time we reduce refinancing risk from the company. We enhance predictability on the maturity and we see that the financial flexibility of the company will be kept. So thank you for your question. Thank you, Renato. Clear as usual. Thank you. Our next question is from André Mazini do City. André, if you will, go ahead.

Thank you very much for the question. I will take that one. So unfortunately on Chinese cars being imported in Brazil, we believe there's a very stable round number of percentage of wheels being produced in Brazil on those cars. It's close to zero. And so right now we believe all these cars are being assembled with wheels coming from China. That picture, we believe, and to a certain extent we know, will change very significantly when localization comes in. And that localization will come in. It may not come in this month or next month, but we believe this will happen next year. And so we are actually working on producing wheels for Chinese OEMs, so that's why I say we know it's happening. Thank you very much.

Our next question from Andresa Baroto from UBS. Andresa, go ahead.

Yeah, no problem, Andrea.

So I will take all three of those questions. So the North American truck rebound, we clearly see it happening. Now, to what extent this will continue, at what rate, that's difficult to say at this stage, but we clearly see a very positive trend now, which wasn't too difficult after the disaster at the end of 2024 and the beginning of 2025. But it comes back as strong as we were targeting, as strong as we were hoping. And so for our profitability, I would say that's a very positive thing. Now, of course, when you start a new plant like the one that I've been showing 15 minutes ago in one of my slides, You cannot run that plant immediately super efficient because you're starting it up with one shift one day and then one shift one week. And so there is a gradual ramp up of that plant. And so you will not see immediately the full extent of that good news in your profitability. But for sure profitability will be supported. Augusto Ribeiro Junior, Bruno Zarella To come to your second question on 2027, we expect and we count on that continuing and not to be only a pre-buy in 2026 and early 2027. We think there's more underlying reasons like the need for freight picking up and also the replacement cost of trucks becoming less than maybe the increasing maintenance cost of All the trucks that were bought during COVID when people got a lot of incentives. And so there's more reasons for the North American truck market coming back. And that's what we are counting on. That's what we are prepared for. And that's what we also expect to be able to see back not only in our revenue, but also in our profitability. So I hope that answers those two questions. From an antitrust proceedings point of view, I have no update for you guys. There's no new news after what we talked about in the last earnings call. Is that okay?

Thank you.

Our next question is from Fernanda Urbano from XP. Fernanda, go ahead.

Thank you, Fernanda.

So, taking your first question on Brazil LV, yes, it's a very positive situation, especially if you compare it with some other regions or Europe, where we are sitting now here. And of course, subsidy plays a role there, not only in the LV, but also on the CV, and we hope in the CV it will help to Stabilize the market. I think on LV it's supporting more growth than what you would have otherwise. I do believe still that there is more room to grow for the Brazilian LV market. Many OEMs have been investing big time and not only the Chinese will invest big time but many OEMs have been investing money in Brazil because they believe there's more potential in Brazil than what we have seen the last couple of years. And so I think it's a mixed bag. A positive mix back, where on the one hand subsidies help, but also I think just generally the market in Brazil can do a little bit better. Of course, Brazil for us as part of our LV portfolio is relatively small. The truck is bigger because we have both components and wheels being big in there. Components has a share in LV but is much bigger in CV in Brazil. But still, it's an important market for us. It's nice to have and we believe that this momentum that we see right now will remain there for the near future. And so we're positive about it. And on top of that, we are positive that once The wheels are not being imported on cars or on CKDs from China. We can participate in that growth in the Brazilian market even better from Brazil. So that's all good. I see that positive, even though I agree with you, part of that is related to subsidies. On the profitability, I think North America, we've been talking about it so much over the last three, four years, because it was a big drop, a big headache. Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum

Thank you.

Our next question is from Gabriel Rezende from Itaú BBA. Gabriel, you can open your mic.

Thank you, Rodrigo.

Hi Gabriel, thank you for the questions. The second question, let me start with that one. We continue to want to look in a very disciplined way on our capital expenditures. And so even though, of course, we will have capex to be spent both in our current operations as well as in tooling and in projects, productivity projects, et cetera, we do not www.patreon.com.br In the meantime, I think we have enough of those smaller projects still in the drawer, even after what I presented in this conference call, to make sure that we continue to grow steadily, that we can produce the wheels and the components that we try to win, and we are winning. In the market, but in a disciplined way, I would say. And so I think from a percentage of EBITDA, we have those kinds of KPIs in place. You will not see something very, very different from us than what you've been seeing, what we've been talking about the last two years. Can you repeat the first question, please? I wrote it down, but I can't read my own handwriting. Yeah, right. Now I can read my own handwriting again. I remember what you said. I talked about the market, right? If you only depend on the global market, on LV, right, there is no growth.

On the CV, there's growth.

So on the CV, we're gaining market share in a growing market. And so there, I think it's a matter of being prepared for that growth. And so I think on the CV side, from a component's point of view, this Castanhas thing, and also some of the investments that we have been making and we're making small and smaller investments in Brazilian components, it will take care of us being able to serve the market and to be acting at or better than the market is providing for us. On the wheel side, I would say, we will try to continue to gain more than what the market is showing us and so in 2026 We will grow our volumes over 2025. I don't know exactly what will happen over the next five months, but unless something very strange happens, we will have more volume in 2026 in LV in wheels than what we had in 2025. So if that is the case and the market is like 1.8%, 2% down, it means that you have been gaining share. First of all, we don't want to lose that share. Based on our portfolio, based on our global leverage, based on our innovations that we are bringing to the market, I think we have a fair chance to continue to outperform the market. I'm not saying when the market is zero, we will do plus 10%. But I think if the market is zero, we want to have two or three. And if the market does minus two, we want to have at least stability. That is a little bit our target. And so for that, we don't need to do a huge investment. For that, we can do small investments and make sure that we produce more efficiently and therefore generate a little bit more capacity to continue to serve these additional volumes, additional technologies that the market could require from us. Now, that being said, if there is a major opportunity in a region and we feel it's the right thing to do for the company, we will look at that. I don't think we're talking about that in the very near future, 2026, 2027. Does that answer your question?

You're welcome.

Our next question is from Marcelo Motta from Deep Morgan. Marcelo, you can open your mic and ask your question.

Hi Marcelo, thank you for the questions. I will start with the second one. So yes, Europe is in a more difficult spot when it comes to industry, automotive industry, and there's a lot of debate, a lot of press about that. I don't think it's a disaster, by the way. Augusto Ribeiro Junior, Bruno Zarella, Renato Jorge Salum I can also tell you that in the past, a little bit longer ago, I'm not talking last quarter or last year, a little bit longer ago, our company already has been reacting to this future. And so we have been restructuring plants, we have been closing plants, and we have been moving equipment, right? And so I remember a time starting with this company, we had three plants in Italy. Italy is beautiful if it's not too hot like right now, but three plants may be too much, right? And so we closed two plants and we moved one, we built one new plant to Turkey based on the equipment of those two plants that we closed in Italy. And then we built another one in Turkey in order to make sure that we are competitive in Europe. So what I'm trying to say is that this company has done already a lot of homework to be ready for a future that we're seeing happening right now. Do we have to do more if things really go south? Yes, we can. And yes, we would. I believe right now we are in a competitive position. But of course, depending on how things go, you ask about five years from now, that's nowadays an even longer time than it was 10 years ago. But if you look over the next five years, I think we're okay. But if we need to do more, we can and we will. And especially when you talk about an aluminum wheel plant, which we have much more in Europe than steel wheel. Equipment of those kind of plants is much easier to move around the world there where you need it than it is for steel wheels. And in steel wheels, you have pass car and you have truck. I believe in track, which is a significant part of our wheel production in Europe. We will rather see good years coming at us. I'm not sure if everything that Standard & Poor's is projecting right now is really going to happen in 2027, 2028, 2029. But I say to the team, even if half of that happens, we're in a good position and we're prepared for it. and Pascal Steele. I think we've done our homework to cope with what's going on in Europe right now. If we need to do more, I think it would be on the aluminum side, and we will and we can. On the truck side, I feel we're okay. Is that answering your question on Europe? Thank you. Then I pass on to Renato Salum for your first question on the CAPEX.

Hello. Thank you for your question. So regarding the capex, if we had like a lower capex in the quarter, it's a matter of like a calendar, putting everything in the schedule. We are thinking about a capex going along with what invested last year. Just remember that we invested 520 million. And from this, I would say that 50% of these 520 is about maintenance. Of course, within maintenance we always have a metal of like sensory robotization that ends up at the end of the day improves productivity of each of our plants. And the remaining of that capex, I would say capex for investment and they are more focused on the 33 plants that we have. If we allocate 5 to 7 million, we have the rest of this 50 million. And what Pieter and I have approved for CAPEX are those investments in which the return payable will be lower in two years. So that's the discipline that we follow. This is what we have as our expectations for the rest of the year. I hope I have answered your question. Yes, yes, I did. Thank you. Thank you. So we are going to finish our Q&A due to time constraints, and I would like to call Mr. Peter Klinkers for the final remarks.

Okay, thank you very much, all of you, for listening to us and for supporting us. Let me finish by saying this. I think if you look at the world, what you read is a lot more dynamics, let me call it positively, dynamics in the world than what we maybe would have thought, would have hoped for. Some things are good, but many things, you know, are not so good. I think, you know, Keeping that in mind, the way this company, this team is being able to manage through is what we need to do, what we target to do. And I'm happy to say that, you know, I believe that is what we're doing. And so let's hope the world will become a little bit more stable. We can always hope for that. And if that happens, that would be fantastic in many ways. But even if it doesn't, I think this company will be able to show solid numbers.

and shareholder value going forward so thank you very much again and bye bye our video conference for results 25 20 26 is now closed our department is at your disposal to answer any other questions thank you all participants and have a great day thank you