Melexis Nv Ieper

Welcome everyone joining us today for the Melexis second quarter 2026 earnings call. I'm Philip Ludwig, Investor Relations Director, and with us today are CEO Marc Biron and CFO Karen Van Griensven. Earlier today, we published our press release and presentation, which can be found on our website. We will start with some brief remarks on the business and financials before taking questions. starting with Marc Biron. Marc, the floor is yours.

Thank you, Philip. Hello everyone and welcome to this earnings call. Let me share some brief performance highlights before handing over to Karen for the financial overview and outlook. To start, I'm pleased to see that Q2 sales has developed well and came in ahead of our outlook. We have seen customer orders increasing as we have progressed through the quarter. We are seeing good growth, particularly in position sensors, a core Melexis strength, where we are able to address demanding automotive requirements such as steering and braking with both magnetic and inductive sensors. Those products are also gaining traction with robotic customers. We see also growth in motor drivers for thermal management applications, in cabins and under the hood, but also in robotic joints. Next to improving top line, we grew margin and we are in line with our first half 26 outlook. Melexis continues to bring innovations to the market with three new products in Q2, designed to address automotive customer needs. In automotive lighting, We have launched a chip with a DC-DC converter. This product architecture reduces the cost of the module of our customer and improves the module robustness against electromagnetic disturbances. We have also launched a world premiere switch for contactless detection of up to 4 positions. It can be used for example in seat track positioning, allowing a more accurate inflation of the airbag to protect the passenger. It therefore contributes to the better safety. And we release a digital sensor, a digital current sensor, to ensure signal integrity in demanding noisy environments. It is particularly important because electrified powertrains evolve towards faster switching technologies such as silicon carbide and gallium nitride. Also in power electronics, I am happy to see the strong interest we are receiving for our snubber. This is a great example of our innovation team bringing solutions to customer challenges. And we will continue to invest in R&D to ensure that our product pipeline continues to grow. I will now hand it over to our CFO, Karen Van Griensven, to provide more details on our financial results and outlook.

Thank you Marc. So sales for the second quarter of 2026 were 217.3 million euros. an increase of 3% compared to the same quarter at the previous year and an increase of 7% compared to the previous quarter. The EURUSD exchange rate evolution had a negative impact of 1% on sales compared to the same quarter of last year and no impact on sales compared to the previous quarter. The gross result was 87.9 million euro or 40.5% of sales, an increase of 6% compared to the same quarter of last year, and an increase of 9% compared to the previous quarter. R&D expenses were 13.8% of sales, G&A was at 6.7% of sales, and selling was at 2.2% of sales. The operating result was €38.6 million or 17.8% of sales, an increase of 8% compared to the same quarter of last year and an increase of 16% compared to the previous quarter. The net result was €30.8 million or €0.76 per share. a decrease of 19% compared to 37.8 million euro or 0.94 euro per share in the second quarter of 2025 and an increase of 33% compared to the previous quarter. With regards to the dividends, the board of directors decided to pay out an interim dividend of 1.3 euro gross per share and the Melexis shares will start trading ex-coupon on October 13, 26, opening of the market. And the second, the record date is October 14, 26. And then turning to our outlook, Melexis expects sales in the third quarter of 2026 to be in the range of 220 to 225 million euro. and for the second half of 2026, Melexis expects sales to be between 445 and 455 million euro, with a gross profit margin around 41% and an operating margin around 18%, all taking into account a euro-US dollar exchange rate of 1.15 for the remainder of the year. and for the full year 2026, Melexis expects CAPEX to be around 40 million euros. This concludes our remarks and we can now take your questions.