Indra Sistemas Sa Ord

Good morning. Welcome to INDRA's first half 2026 results presentation. And now, hand the conference over to Mr. Ezequiel Nieto, Head of Investor Relations. Please go ahead.

Good morning, everyone. Welcome to our first half 2026 results presentation. My name is Ezequiel Nieto, Head of Investor Relations. Before we begin, let me briefly draw your attention to the disclaimer on the current slide, which sets out the legal framework applicable to today's presentation. Joining me today are Josep Maria Recasens, Chief Executive Officer of Indra, and Miguel Forteza, Chief Financial Officer of Indra. With that, let me hand over to Reca to walk you through the key highlights of the quarter. Reca, the floor is yours.

Thank you very much, Ezequiel. Good morning to everybody, and thank you for joining the current presentation of the first group, first half results of Indra in 2026. Actually, it's a privilege to address you today in my first results presentation as a Chief Executive Officer, and I fully recognize the responsibility that comes with this role. The results that we are presenting today are a result of the work carried out by our teams during the first half of the year. I want to acknowledge and recognize that work and thank everyone at INDRA for the welcome I have received. As you may know, I'm coming from the automotive industry, more than 25 years in the automotive sector, 20 years in the Volkswagen Group and the last five based in Paris in the Renault Group. So I have had different responsibilities and strategy programs Partnerships and Business Development but despite the role were different the equation was always the same turning a strategy into execution by making the right product choices managing programs efficiently and diligently and delivering on our commitments that is the approach I bring to Indra in my first weeks at Indra I have focused on what I think matters the most What I have found, indeed, is a company with exceptional outstanding technological capabilities, a strong backlog, talented people, and a real momentum. My role, in fact, is to accelerate that execution. Let me now turn to the environment in which we have to do that. Actually, every time I join a new venture, and this is a very particular one, I like to understand in which is the environment and context I have to operate. And in fact, I have identified a total of eight challenges. Actually, our industry is at the same time facing both more challenges and opportunities than ever before. First, geopolitical instability and polarization are reshaping the global security environment. Governments are reassessing the capabilities they need to protect their citizens, their infrastructure and their strategic interests. Energy security and resilience have also become part of our national security. The question is no longer only how much energy costs, but whether is it available and secure when it is needed. As a consequence, we are experiencing a sustained increase in defense spending. The 27 EU member states spent more than 400 billion euros on defense in 2025. 20% more than in 2024. In 2026, that figure is expected to reach 450 billion euros according to the latest European Defense Agency report. This is not a temporary spending cycle. It is a structural change in priorities. At the same time, shortages of critical raw materials and pressure on global supply chains are forcing Europe to reconsider its dependencies and strengthen its industrial capacity. That is why sovereignty has moved to the center of government agendas. Governments are asking not only what capabilities they need, but also where they are designed, where they are produced, and who controls the technologies behind them. In this context, scale and innovation are decisive, decisive competitive advantages. Developing excellent technology is not enough. Companies, and this is what Indra aims to be, must be able to industrialize it, produce it reliably, and deliver it on time at the required quality and a competitive Civil and military technologies are also converging, and converging really, really fast. The traditional 5 to 10 year development cycle in defense no longer matches the speed at which threats evolve. Ukraine has shown how commercial drones and satellite communications can be adapted to battlefield needs in months, not years. Disruptive technologies such as artificial intelligence, and Quantum are accelerating this transformation even further, reshaping how systems are designed, how decisions are made, and how capabilities evolve. Together, these forces are redefining our industry. For a company like INZA, this environment is not a threat. Actually, it's our moment. Every one of these forces points to greater demand for precisely what we do. But capturing that opportunity and turning it into results will depend on execution. Given this context, we have defined four clear principles to guide how we operate. The first is delivery and speed. Our credibility is earned by delivering on our commitments, on time and with full control of every problem. That means Managing milestones by milestones, anticipating bottlenecks, and taking decisions faster. In programs such as land vehicles, drones, and radars, the challenge is clear. Increase our delivery capacity and convert demand into industrial output. The second is quality and reliability. In our businesses, quality is not an option. We work on systems that must perform in critical environments over very long cycles Eurofighter is a good example. It is not a program measured in months that indicates. It requires the same level of excellence, mission after mission, and upgrade after upgrade. The speed is, again, essential. But speed cannot come at the expense of reliability. The third is sovereignty. Technologies like Ingramine keep critical capabilities in our hands, in our country's hands, and in Europe's hands. The fourth is competitiveness. Being sovereign is not enough. We must also be competitive in cost, in lead time, in quality, in technology, and in international ambition. Air traffic management proves that INDRA can compete globally and win. That standard must guide us across the globe. And the pinning all four is our industrial footprint and ecosystem. Our plans Engineering centers, suppliers and partners must operate as one single system. These are our four management principles, deliver faster, deliver with quality, control critical technologies and compete globally. That is how we will turn a strategy into execution and backlog into results. With that, let me turn to our first half performance. With that strategic context in mind, let me now turn to the key operational and financial highlights of the semester. The results for the first six months of the year demonstrate the consistent execution of our strategy and the continued progress we are making to deliver our annual targets. In particular, the second quarter marked a clear step up in performance, with a further acceleration in growth and continued margin expansion across the globe, underscoring our ability to deliver profitable growth while maintaining a strong operational discipline. Before taking a closer look at our financial performance, let me briefly highlight some of the key milestones achieved during the first half of the year. In the United States, we strengthened our industrial footprint with the opening of our center of excellence in manufacturing in Kansas. while also commissioning the first radar for the FAA, a significant milestone that reinforces our position in the air traffic management market. In defense, execution remained strong. With tests, we have delivered in half a year more than the full year 2025. And this is a statement we want to keep going on. We also continue to expand our ecosystem of strategic partnerships through agreements with leading industry players such as BAE Systems, Rheinmetall, NADS, IVECO and Kongsberg. These collaborations further enhance our technological capabilities, broaden our market access and strengthen our long-term growth opportunities. In terms of commercial activity, We secured important contracts awards, including Radar Project in Congo and the Transport for Washington contract in the United States, further supporting our future growth outlook. Finally, we continue to advance our portfolio optimization strategy through the disbursement of non-core assets, completing the sale of main site business consulting division and reinforcing our focus on core businesses. Let me now turn to our financial performance and walk you through the key results for the first half of 2026. All the backlog reached a record height, €20.5 billion, more than doubling year on year with a 117% increase. At the same time, all the intake grew by 58% to €5 billion, driven primarily by the strong momentum in defense and the contribution of Ispasat and Isdesat following their integration into the space business. Revenues increased by 30% year-on-year to 3.2 billion euros, supported by an outstanding growth in defense, which more than doubled its revenues, and by a continued expansion in air traffic management. Importantly, this strong revenue performance was accompanied by improved profitability. Erit margin reached 9.9%, after 1.3 percentage points versus the first half of 2025, and 10.6% excluding the impact of test consolidation. In absolute terms, EBITDA and EBIT increased by 22% and 51% respectively. Net income amounted to 219 million euros, representing a 2% increase versus the first half of last year. Free cash flow reached 1.5 billion euro compared to the 65 million euro in the same period of 2025 fully explained by the prepayments received in January 2026 from the special modernization programs. As a result, we closed the first half of 2026 with a strong balance sheet and a net cash position of 1 billion euro implying a net debt EBITDA ratio of minus 1.3 times Providing significant financial flexibility to support our future growth ambitions. Looking to the second quarter on a standalone basis, we saw a clear acceleration in revenue growth, driven by the strong performance across all our divisions. Defense was particularly noteworthy, delivering exceptional triple-digit growth of 103%. This solid top-line performance was also reflected in profitability. Edit margin reached 10.7% in the quarter, an improvement of 1.8 percentage points compared with the second quarter of 2025. Let me now turn to our first half-phase performance. During the period, we achieved revenue growth of 30% in local currency and 16% on an organic basis. This performance was supported by both solid organic growth and the contribution from our recent acquisitions, while FX had a marginal impact on reported revenues. Moving now to the divisional breakdown, I would like to highlight the continued transformation of our business portfolio. Aerospace and Defense now represent more than 71% of the group's EBIT, as illustrated on the chart on the right-hand side. underscoring the strategic importance of these activities and their growing role in driving value creation across the group. Looking at our workforce metrics, headcount decreased by 5% to 58,383 employees, mainly driven by the 12% reduction in Insight. More importantly, this evolution has accompanied by a substantial improvement in productivity, revenue per employee increased by 30% year-on-year and by 21% compared with December 2025, highlighting the benefits of our portfolio transformation and the greater efficiency of our organization. With that overview of the group's results, let us now take a closer look at the performance of each division and the key factors driving growth and profitability across the portfolio. Starting with the defense business, the first half of 2026 confirms the strength of the business in all key performance indicators. Order intake increased by 120%, further reinforcing long-term visibility. Revenues more than doubled year on year, supported by a successful ramp-up of major programs already in execution. Profitability remained at sector-leading levels with an EBITDA margin of 20.9%, an EBIT margin of 17%, excluding the test impact. Looking specifically at the second quarter, Defense delivered a particularly strong quarter with program execution accelerating significantly. or the intake increased by 195% driven by Eurofighter, Air Defense and PEMS. This was accompanied by a remarkable revenue growth of 156% supported by the ramp-up of the test PCR 8x8 deliveries and the strong execution of major programs already underway. Profitability remained resilient with a beta unedded margins of 19% and 16.6% respectively. Following with Space, the first half of 2026 marks a transformational period following the integration of ISPASAT and ISDESAT, significantly expanding the scale and strategic profile of that division. Order intake increased by 98%, while the backlog reached 2.9 billion, providing a strong long-term visibility. Revenues grew by 398%, primarily reflecting the first full half consolidation of ISPASAT and ISDESAT. Importantly, this integration has also reshaped the division's profitability profile, with the EBITDA margin improving to 40.5% and the EBITDA margin reaching 10.6%. Looking at the second quarter, the Space Division continued to showcase the new operation scale of the integration of ISPA-SAT and ISDE-SAT, with all the intake growing by 110% and the revenues by 403%, driven by the strong contributions across Spain, America and Europe. This effect was also reflected in profitability, EBITDA and EBIT margins, improving to 42% and 14.2% respectively. Turning now to air traffic management, the business delivered another strong set of results in the first half of 2026. Order intake increased by 57%, leading by a strong momentum in America, AMA, and Spain, further strengthening the division's growth outlook. Revenues increased by 16%, while organic revenue growth reached 15%. Highlighting the underlying strength of the business. At the same time, profitability continued to improve with the beta and edit margins increasing to 15.2% and 12.6% respectively. Focusing now on the second quarter, Air Traffic Management delivered another solid quarter with order intake up to 84% driven by strong bookings across AMEA and Europe, while revenues advanced 15% in the quarter. The division also delivered a further improvement in profitability, with a better annual margins, reaching 13.9% and 11.9%, respectively. Looking at mobility, the key highlight of the first half was the outstanding commercial performance delivered by the division. At order intake, More than quadrupled year-on-year, increasing by 317%, supported by several landmark awards like the Transport of London Concert, the Saudi Rail Maintenance Program, and the Transport for Washington Concert. These awards drove an increase in the book-to-bill ratio to 5.40 times compared to the 125 times in the first half of 2025, providing a strong revenue visibility for the coming years. Moving on the second quarter, Mobility delivered another solid performance, with order intake increasing by 92% and revenues growing by 2%, while profitability reflected EBITDA and EBIT margins of 2.7% and 2.6%, respectively. Finally, let me conclude the divisional review with Mindsight, which delivered a resilient performance in the first half of 2026, with revenues increasing by 3% while organic growth accelerated to 5%, driven by the strong performance of public administrations and healthcare. Order intake rose by 2%, maintaining a healthy book-to-bill ratio of 1.19 times. Furthermore, profitability remained stable, with an average margin of 5.8% and operating margin standing at 6.9. Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Hand over to our Chief Financial Officer, Miguel Fortefas.

Thank you, Rekha, and good morning, everyone. Starting with the free cash flow, the first point to highlight is that in the first half of 2026, the company achieved an exceptionally strong free cash flow of 1.5 billion, compared with 65 million recorded in the first half of 2025. As we explained during our first quarter results presentation, this increase is entirely driven by the prepayments received in January under the 2025 Special Modernization Programs or PENS. After deducting the amounts already invested in these programs, the net impact of these prepayments at the end of June stands at 1.7 billion. As these funds are progressively deployed to execute the corresponding programs, reported free cash flow will naturally moderate over the coming quarters. That said, during the second quarter, we unlocked additional PEM-related prepayments, which partially offset this expected reduction. Additionally, as a reminder of a point we discussed also in the first quarter presentation since the beginning of 2026 we have stopped using factoring at quarter end given our current cash position as this instrument no longer provides an efficient source of financing for reference factoring historically represented approximately 187 million at the close of each quarter For this reason, and to facilitate a like-for-like comparison with previous periods and with our full year guidance, the chart on the right reconciles reported free cash flow of 1.5 billion to a comparable free cash flow of 15 million accumulated in the first half of 2026. Adjusting for both the net effect of Pemps prepayments and the impact of factoring. While this comparable free cash flow is below the 65 million generated in the first half of 2025, the difference is fully explained by the higher levels of capex and working capital required to support the execution of our growing backlog. These investments reflects the strength of our business and the ramp up of major contracts already awarded. Importantly, this temporary effect does not change our expectations for the full year and we remain fully confident in delivering our guidance of more than 375 million of free cash flow in 2026, excluding the impact of PEM related prepayments. Regarding the working capital, the evolution of days of sales shows an extraordinary year-on-year improvement, mainly explained by the prepayments received under the special modernization programs, minus 118 days of sales, and to a lesser extent by the positive net effect of days of sales resulting from the consolidation of Espazat and Islasat, that is, minus 26 days of sales. As a result, in the first half of 2026, we reached minus 110 days of sales, compared with six days recorded in June 2025. We will now analyze the evolution of net financial debt in the first half of 2026, The company closed the first half of the year with a net cash position of 1 billion, compared with a net debt of 583 million recorded at the end of 2025. This change is primarily explained by the prepayments received from the PEMS, which amounted to 1.7 billion in the first half of the year. In addition to this impact, it's worth highlighting the strong operating cash flow of 444 million compared to 219 million in the first half of last year, reflecting the solid operational performance of the business. At the same time, CapEx increased significantly to 183 million in comparison with 40 million of first half of 2025 in line with the group's commitment to its industrial transformation strategy. Lastly, the sale of the BPO business generated proceeds of 70 million, which is also reflected in the financial investments FX impact and other items bar shown in the chart. This construction is fully aligned with our strategy of divesting non-core IT activities and further increasing our focus on our space and defense. As a result of the factors discussed, the net debt to EBITDA leverage ratio improved to minus 1.3 times at the end of the first half of the year, compared with 0 times in the same period last year. And finally, regarding our debt profile, we continue to make progress in reducing the cost of our gross debt, which declined to 3% in the first half of 2026 from 3.1% in the same period last year. At the same time, the average debt maturity extended to 3.8 years compared to 3.1 years in the first half of 2025. Lastly, the consolidated cash position stood at 2.5 billion, primarily reflecting the advance payments received under the PEMS previously mentioned. In addition, the Group has 949 million of available committed credit facilities, including a 385 million euros financial facility from the European Investment Bank for specific uses. With that, we conclude the financial review, and I will hand that back to our CEO for his closing remarks.

Thank you very much, Miguel. Ladies and gentlemen, let me close where I began. We are building on a solid foundation, robust financial performance, a competitive product portfolio with proven demand across all markets, from radars to electronic warfare, and above all, highly qualified people. That foundation gives us the capacity to be ambitious. Now the priorities are clear. We must turn the growing demand for technological and industrial sovereignty into sustainable growth. We must scale artificial intelligence through IndraMind as our sovereign platform and a business in its own to respond to our clients' needs and embedding AI in our products such as command and control, payments or intelligent traffic systems. We must play a leading role in strengthening the Spanish defense ecosystem while deep in cooperation with our European partners. And we must capture more value alongside the several groups' business units, corporate functions and geo-sharing technologies, capabilities, best practices. We will set out the roadmap in our new strategic plan, ambitious in its objectives, realistic in its assumptions, and disciplined in its execution. Until then, the priority is clear. Deliver and deliver.

Thank you very much. Thank you. We are now ready for the Q&A session.

Thank you. Ladies and gentlemen, the Q&A session starts now. If you wish to ask a question, please press star 4 by 5 on your telephone keyboard. and our first question comes from the line of Juan Canva from Best Inverse Securities. Please go ahead.

Good morning. Thank you for taking my questions. Congratulations on your appointment. I was, I wanted to know about your capital allocation strategy. There has been a lot of speculation in the press about changes. for some of the international partners at the beginning of June and would like to see to know what you are strengthening prospects if that happened and what are you doing to I wanted to ask about your capital allocation strategy in terms of partnerships in national investment plans since there has been a lot of speculation in the press recently about changes of previous management plans and also whether you will continue looking for alternate acquisitions and divesting parts from the inside. That was the first question. And the second, I want to ask about your in-line strategy after the US restricted access to Artificial Intelligence Models for International Partners at the beginning of June. What are you doing to develop Ingramind and whether these restrictions have increased your business prospects? You were targeting, I think, 1 billion revenues in Ingramind at the end of the decade. Thank you.

Look, thank you very much for the question regarding our capital allocation logic or strategy. What I would say is the following, right? So we have a massive challenge in front of us in terms of technological disruption and acceleration speed and scale in all fronts, right? And I'm sure that there is no company on earth, especially in Europe, that will be capable to manage all that in a standalone basis. So it's going to be crucial to set up alliances with partners, suppliers and other peers in the European sector to make that happen. So I insist on the fact, I don't believe that nobody alone will make it happen. So alliances will play a fundamental role and this is where capital allocation plays a role in it. Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord What I would like to highlight is the relevance role of a business unit like that. To protect our critical infrastructure, it's key. Our value proposition within the mind is to cover an end-to-end platform, AI native, in order to be a solid instrument to capture Sistemas Sa Ord Sistemas Sa Ord to become a leading player not only in Spain but in Europe in order to offer AI at first solutions for all critical infrastructures in Europe.

If I may, Juan, just to give you some big numbers around Indramind this year. Just to put that in context, last year revenues to Indramind were 323 million Thank you, Juan. Next question, please. And next question comes from the line of Michael Priest from UBS. Please go ahead.

Good morning and welcome to the company. We've obviously had a CMD in our thoughts for some time now. Can you give any indication on the timing of that? And I sense that there's still a degree of strategic uncertainty. Are there any parts of the business that you would consider selling? Perhaps we've heard of Minsight being core, non-core at times over the last two to three years. Maybe just to frame it, if any disposals would be considered. And then just in terms of the timing of the 2026 PEMS, have you any insights or expectations there? And in relation to cash flow, how can you firm up the 2026 CAPEX guidance? Thank you.

Regarding the first question about the strategic plan, of course there is a lot of attention about that strategic plan, right? I would like just to ask you for a little bit of patience. It's about 15 days that I'm on duties in the company and trying to catch up very fast in all senses, meeting people, learning about everybody and understanding all the dynamics and strengths of the company. As mentioned during the presentation, by Miguel and myself. I think that we have a very strong foundation, solid, very solid foundation based on a high backlog and contracts. Our priority at short-term right now is to make all that happen in terms of delivery and speed to fulfill our customer expectations in that respect and this is what we are making that happen. Secondly, of course, understanding with the team time to explore how do we kick the next strategic wave for the company that of course is going to be based on what the company has been reaching so far but probably we will need to strengthen our I would say technological differences because I do believe that companies that bet on technology that create difference and outstanding performance on them are the ones that are going to succeed Here, as mentioned before, Indramind with artificial intelligence is going to play a crucial role in terms of kind of brain of systems and command and control, making all that based on our past experience, right? So let me remind you that Indra is a tech company, right? Per se, per definition. and with the high skilled qualified number of software engineers and developers in the company, we are ultra well prepared to face all those technological challenges because this is in the DNA of our workforce. Who can do that better than us? This is the question that we would like to demonstrate. And regarding the PENS of 2026, I think that it's more the Ministry of the PENS that has the responsibility to announce and when we have of course our willingness to continue participating proactively and responsibly in the assignment of those stems and the consequent execution but I would rather expect wait to the announcement that the public administration in that case the Minister of Defense will do due course

Yes and then Michael regarding your question on some guidance on CAPEX let me give you some granularity on that first half of the year gross CAPEX of 205 million which 136 tangible 69 intangible grants 22 million so net CAPEX of 183 so our Guidance is around 300 million for this year. That's important to mention, not taking into account ISDESAT CAPEX, which is included in this 183 million I already provided, but including ISPASAT CAPEX, right? So, and just to give you a sense of ISDESAT CAPEX, which, by the way, you know that is fully Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord That's important because we are in comparison with last year where we invested around 2.5%. We expect to increase our capex on revenues at a level of around 4 to 4.3% this year.

Thank you, Michael. Next question, please.

Next question comes from the line of Jessica Agarwal from Goldman Sachs. Please go ahead. Hi. Thanks for taking my question. So just the first one, I think, like before in the first quarter, there was this expectation that, you know, the defense revenues could track at about a billion by the first half. So just wanted to understand if you can give any comments on what kind of visibility do you have in terms of, you know, the defense revenues and Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord

Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Basically driven, and I can give you some details on that, by PEMS, which brings 217 million, by TESS, 197 million, EurDefense, around 145, the Eurofighter, 140, the EFCAS, 112, just to provide you, and we're talking around the EFCAS, and it's important also to highlight that, Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord

with our internal expectations. Remember, we delivered 9.9% margin and the implicit guidance is 10. This was fair, so has been particularly strong thanks to defense with Eurofighter project having a strong contribution to the defense divisions, EBIT. Although we expect that it's the division's margin to close the financial year at the levels already announced. So we therefore, we reaffirm our guidance of EBIT of more than Thank you Could you please repeat the question?

So the BPO business which was sitting in the main set, there was a sale that was announced which is closed now. So and then as per what we have in the guidance, it says that it still includes BPO. Does the guidance include, like will we have a guidance updated for that disposal?

I mean, the guidance we provided for MINSERT, which is taking into account BPO business for four months, which has been the case, and all the, you know, the guidance that we have of growth and EBIT margins, you know, between 6.6% and 7%, this is our guidance for this year, are taking into account, you know, the Exclusion of the BPO business. Yes.

Okay. Okay. Thank you.

Thank you. Next question.

Next question from the line of Carlos Treviño from Santander. Please go ahead.

Good morning. Thanks for taking my questions. My first question is you have highlighted that you could continue to look for alliances with the European peers. uh moving forward my question is if you could reconsider to assign alliance with Hanwha the South Korean company uh there could be any case in the scope of that alliance moving forward on a couple of questions from an operational point of view I'm sorry because it's a good number that I'm going to ask you for a space where Thank you.

I'm going to answer the first question and Miguel will take over the second and third question. So about the first one, no news or good news. It means that we are fully engaged and committed to deliver the project with our partner, in that case Hanwha. So it's our major responsibility to keep the momentum that we have created in order to fulfill about 282 objects we have to deliver for the whole program and this is of paramount importance and we will not put that in danger and this is our priority.

Thank you Carlos and regarding space 14% decline in organic revenue is based simply due to time and differences in milestones between one year and the next. In fact, this decline was moderated in the second quarter with the fall of just 6%. But we clearly reiterate our ambition to reach more than 400 million by the end of the year. and also you've seen the EBIT and EBITDA numbers which looks quite good in terms of EBITDA respect to finish the year around 40% and in terms of EBIT you know that's a quite volatile you know as a lack of scale in the business to date around high single digit we expect Again, you know, there are some topics that may help the business in the future, as you very well know, the European Space Agency, new budget, programs at European level, clearly Paris Square, we should be having some news in the coming weeks, potentially new PEMS this year or next year, and within the new European multi-annual financial framework of the next European budget where clearly space will be one of the main focus and regarding the expectations for coming revenues we think that MINSET will end up the year between low single and mid single digit growth and we have Quite Confidence On The Business Keeping Keeping Growing Especially You Know We Compare With Other Peers We Are Doing Clearly Clear The Way And Remember Again That Mid-Side Guidance Is Considered Is Considering The BPO Divestment Business Contributing Only Four Months And In Terms Of Margins I Already Commented Our Guidance Okay Carlos

Thank you. That was very helpful. Thank you. Next question, please.

Next question comes from the line of Nicolas Davis from Odo. Please go ahead.

Yes. Good morning. Thank you for taking my question. The first one is regarding the guidance. Can you explain what gives you such confidence to reach a top-line guidance that given that you were slightly short of your Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord And my last question would be, we have seen some press article reporting that the company is wishing to conduct a forensic investigation into certain patterns decisions made by the previous leadership. Could you comment on that to confirm or not? And if it's confirmed, what's prompting this investigation? Thank you. Thank you.

Thank you Nicholas and regarding our confidence on the top line guidance 7 billion 700 million clearly I mean we are fully confident on achieving that guidance even if the insight goes from low to mid to mid digit growth in any case We have room from defense and ATN guidance to compensate, so we stress our commitment and reliable on achieving this guidance. Regarding the high margins on defense slope that were maybe slightly higher than expected, especially if you take the dilution effect Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord We have been stating of over over the past weeks pence Margins are in line with our defense margins, right? So but I mean we don't rule out these margins special in defense to moderate slightly over year-end and to end up around 18 19 percent end of the year Excluding again the effect on on tests. I

The last question, we will not make any comment about that.

Okay, thank you. All right, understood. Thank you. Thank you. Next question, please.

And this question comes from the line of David Lopez Sanchez from JP Capital. Please go ahead.

Hi, good morning. So over the last few months, we have seen an increase in emphasis on industrial partnership rather than M&A. Have these changed your view on the need for acquisition to support the future growth, or do you still see the consolidation as an important tool for strengthening your industrial capacity? And my second question is a follow-up on the CMD. Could you provide a more precise indication on the timing, and should we expect it before the GIM? Thank you.

About the first one, I would say that all those are open. We will not constrain ourselves in exploring all kinds of vehicles to generate sustainable growth in terms of revenue and profit, no matter what. So all instruments are available and none of them is closed. About the industrial angle that you are mentioning, what do we believe is given the fact that we have to put in place an excellent operation management system in Indra because we want to invest. We are investing and we are building facilities from scratch in brownfields especially. It's a huge opportunity, a unique opportunity, a once in a lifetime opportunity. to build a difference in terms of excellence in operations, in productivity, in lead time, in quality. So an example is what we are doing in the north of Spain, in Gijon, with our facility there to produce land vehicles. So we're going to invest in the facility, so we will renovate it. It's going to be much more than just an ultra-modern galactic, I would say, in order to ensure that productivity that will make the difference I'm sure right so this is the first one and regarding the CND sorry to answer in a similar way than before I would like to ask you for a little bit of patience it is about 15 days that I'm in the company I try to catch up as soon as I can everything I need to understand all the company in order to Sistemas Sa Ord Sistemas Sa Ord Sistemas Sa Ord So finally, I would like to thank you very much for your attendance and your questions. And I'm sure that we'll have the chance in the coming days and weeks to meet together and further explore the major challenges and opportunities that INDRA and the defense sector as a whole are facing. And I'm going to be very happy to learn from you all. Sistemas Sa Ord