Lottomatica Grp Spa U/Adr

Good afternoon. This is the Coruscant Conference Operator. Welcome and thank you for joining Lottomatica Group's first quarter 2026 results conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Mirko Senesi, head of IR at Lottomatica. Please go ahead, sir.

Thanks, operator, and good morning to everyone. Welcome to Lottomatica Q1 2026 result presentation. I'm here today with our CEO, Guglielmo Angelozzi, and our CFO, Lorenzo Mallancher. Now, the floor directly to Guglielmo for the presentation. Guglielmo, please.

Thanks, Mirko, and good morning, everybody. uh we can start with page two of the presentation very happy to share with you another very good quarter um ebita continues to grow double digit on a normalized level and also revenues and uh we have a positive seven percent uh EBITDA also on a reported basis notwithstanding the negative sports payout in the quarter. This is on the back of a very strong market. As you can appreciate from the two graphs on the below part of the slide, online has continued to grow mid-double digit in terms of bets and so total sports, meaning online and retail. And at the same time, we've performed well in competitive terms, as you will appreciate in a few minutes. So let's get to page number three. Well, this is the list of the main items that we think is relevant to comment for the quarter. As I said, the market has been strong. Tail operators have continued to lose market share, particularly in iGaming. No issue from prediction market, notwithstanding a recent sponsorship. They continue to be illegal. The product-consumer mismatch continues to be strong. We don't believe there is any market space. And at the same time, sponsorship has basically no impact in enhancing local brands. Very good news on PwO market shares. iGaming, we've recovered half of the share that we lost through the migration. And we're a bit behind in terms of iSport, but this is explained by the market trend on overall sports, meaning online plus franchise, which you know franchise has been particularly strong in the last few quarters. And so it is the case also for us. And so if you look at total sports, we have recovered to pre-migration levels of 9%. And we'll see more detail in a few minutes. There's been refinancing done with the important raising more capital, more debt, 765 million euros. 400 was a refi and additional capital for general corporate purposes including buyback and bolt-on acquisition. The overall consequence of this is that we lower our cost of debt from 5.3% to 4.9%. Page number 4. All that I have said leads to strong confidence on us being at the top end of the guidance for 2016. And also in being able to confirm our strong commitment on capital returns with up to one billion euros to be returned to shareholders in 26 and 27 including dividends. So the keywords are continued growth and continued returns to shareholders. Now let's go quickly page by page to see the items, the relevant items that I mentioned a couple of minutes ago. Market, strong market momentum. You see the details here. Again, gross mid-double digit. iSports gross mid-double digit. And sports retail shy of that, of course, in terms of that, because that's the only thing you can look at given the payout dynamic in the quarter. Page number six, you can appreciate the details of the tail operators progression and our progression in terms of market share. This is an eye gaming on the tail operators. You continue to see the sharp decreased trend starting from Well, it was progressing throughout the year and it was an overall trend, but it has accelerated starting from the new concession. From the 2024, 4.4 points, which is roughly 25% of the total market share that this cluster had has been lost. We continue to grow market share, the 32.2% that you see there is including An additional bolt-on that we've made after Sportbet, we've done another deal with Begain, so this is Performa for that. So very good performance both organically and with our deals that allow us to quicker consolidate take advantage of the erosion of the tails. Page number seven, super fast, was basically just commented a few minutes ago on... Prediction markets, there's a bunch of data points here that you can look at and that show why this continues. This is not at all an issue for us. I think we can go directly to page number eight, which is the progression on PWO. We've separated from iGaming and sports. You know, iGaming, half of the... market share which had been lost due to the migration has been recovered and there's a consistent path, so it's not really, there's not really volatility in the progression. And page number nine is the same trend for sports. You can see in the graph, sports as a total, completely recovered. And then the detail, the breakdown between iSports and sports franchise. There is still room to go in iSports, but this has been... you know, compensated by a more than favorable trend on sports franchise. This is the consequence of the trend that we've observed at an overall level in the market and also, as it was mentioned before, by the fact that the... Actually, the... The retail recovery, the retail transition, the retail recovery was structurally faster. But as you know, our GGR to profitability to EBITDA contribution from the two segments is pretty much about the same. So actually, this is very good news. Page number 10, especially a summary, we wanted to recap and make sure we were on the same page and we fully appreciate the model, the business model of Lottomatica, the overall framework and setup. So on one side you have a very strong and resilient business model because of a bunch of reasons including omnichannel, product tech, AI leverage which results into top line growth, cost control and scalability and M&A, demonstrated M&A and integration capabilities. And that's the core business part. Then we believe we have a very robust and steady capital structure and as you've seen we continue to optimize our financing costs, our balance sheet and through that the financing costs. And we believe we have a smart capital allocation, meaning a good balance between organic growth compared to M&A and compared to the right shareholder remuneration. This results into growth and returns, which is the first page and the last page of this section of the presentation. And we wanted to do an interesting exercise, I believe, We took all European listed companies with market cap above 5 billion euros. We went to filter those which have grown at least 10% with EBITDA. then those who have at least 30% EBITDA margin, then those who have at least 75% of cash flow conversion, so really cutting the parameters at the top end of the range, and then you are left, and then those which have total short-order returns of at least 100% in two years. And then you left with three companies, which is, you know, of course, less than 1% over the almost 400 companies that we started with. And that's basically the result of the model that you see on the left, growth and returns. So I leave the floor to Lawrence.