Maire S.p.A.

Good afternoon. This is the Coral School Conference Operator. Welcome and thank you for joining the MyRetechnimont First Half 2022 Financial 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. Alessandro Bernini, CEO of MyRetechnimont. Please go ahead, sir.

Good afternoon, everyone, and thank you for attending the first half of 2022 financial results conference calls. The first half of 2022 has shown a solid and growing financial performance. Revenues and EBITDA have grown at double digit rates versus the corresponding period of last year. Net income has also grown at an impressive rate. We are starting to reap the benefits of our investments in green energy with the new project started leading to higher revenues of 125.7 million euros and a record backlog of about 800 million which has increased threefold over one year. This solid financial performance has been accompanied by a very strong cash flow generation of 149 million euros, which has led to an adjusted net cash of 44.1 million euros. This is the ninth consecutive quarter of improvement in the net financial position. Our 9.2 billion euros backlog continues to be extremely healthy and well diversified, and the group is not dependent on any single geography. A 2.9 backlog cover makes us confident about our immediate future. At the same time, our business drivers continue to remain solid, as reflected in a commercial pipeline worth almost 53 billion euros of which seven in green energy. In conclusion, we are successfully executing projects while picking up the pace in the energy transition. Our main consolidated financial results and KPI are shown in slide four, and will be discussed in more detail later by Fabio in the presentation. Before we discuss our operational performance, we would like to give you an update on our Russian presence. The projects advanced in full compliance with all applicable laws and assumptions. These activities were instrumental in order to ensure a smooth and orderly transition to the clients. As anticipated in our first quarter webcast last May, projects have now been suspended for at least six months. This means that no revenue contribution is expected in the second half from a backlog that is worth about 1 billion euros at the end of last June. The project's financial position continues to remain in equilibrium. while all commercial activities had already been suspended in the first quarter. We continue to monitor this evolving situation and will provide additional updates if and when the situation changes. And let's analyze now our operational performance. Our order intake in the first half of this year was almost 1.1 billion euros. This is impressive, considering that last year we had a record year with over 6 billion euros in new contracts. These years, order intake has been extremely diversified, both in terms of geographical locations, contract type, and business. This is thanks to the healthy commercial pipeline that continues to offer a variety of interesting prospects all over the world. Moreover, our increasing success in green energy is demonstrated by the fact that almost half of the entire first half order intake is in this business line, a testament of the validity of our technological leadership in energy transition. The virtuous path that has continued this month, I mean July, with the $300 million in loop ammonia plant in the Middle East, as well as with a biomethane plant in France. Let's take a look at one of these wind energy projects in more detail, namely a green hydrogen plant award in India. In fact, last May we were awarded an FEC contract for a green hydrogen plant in Vijaypur in central India. The award was granted by Gas Authority of India Limited, the largest state-owned natural gas processing company in India, with diversified activity across the world natural gas value chain. The project's scope of work entails full engineering, procurement and construction up to commissioning, startup of the plant and performance guarantee test run, while its completion is expected in 18 months from the letter of acceptance. In line with its national hydrogen mission, this project represents an important milestone of India's journey towards a hydrogen-based and carbon neutrality industry and economy, as well as a tangible confirmation of the steady growth of our group's green energy business. Blending green hydrogen into the gas network or using it as a green feedstock to decarbonize the fertilizer and other harder-to-abate industrial processes are essential uses which are enabling the green hydrogen economy to accelerate and scale up. With our historical presence in India, We are proud to concretely contribute to the country's 2030 decarbonization targets while establishing our leading position in energy transition in the country. While our backlog has remained stable in the second quarter, it continues to be characterized by an overwhelming proportion of gas monetization and energy transition projects. This is especially driven by a significant increase in the green energy backlog thanks to the various green transition projects which were acquired in the first part of the year. Moreover, The order intake of the last 18 months has made the backlog even more geographically diversified than ever, with an even split between the Middle East, Europe and the remaining geographies. The diversification is extremely relevant in light of the current geopolitical events, as we do not depend on a single country. Let's focus now on our two business units, starting from our core business. The E and AP portion of the hydrocarbon backlog has remained stable at about 1.1 billion euros, or 13% of the business unit backlog. This continues to contribute to the risking of our existing business, a very relevant factor in these volatile times. The backlog cover is 2.8, providing a very high visibility for the future. Moving on to the commercial opportunities in our core business, our pipeline has increased to 45.2 billion euros at the end of June, up almost 5 billion euros this year. The last quarter has seen a significant increase in new initiatives about to be tendered. driven by the resilience of our core business, strongly supported by powerful business drivers. Such a positive environment bodes well for our group's growth prospects in the years ahead. All the geographies where the group is active continue to remain extremely attractive, in particular The Middle East continues to remain an area of incredible opportunities, driven by a new wave of downstream projects. At the same time, we are witnessing an increase in activity in North America, driven by an abundance of gas as a feedstock for fertilizer plants, as well as renewed investments in other gas monetization plays. Our pipeline remains extremely strong and geographically diversified, continuing to provide solid support to future awards in the short and medium term. Let's move now to the Green Energy Business Unit and our efforts in the energy transition sustainability. In 2022, we have shifted our pace in green energy and we significantly increased our growth in this business unit. We are developing and implementing our technological solution worldwide, picking up different opportunities and providing innovative solutions suitable to our clients across the various business lines. In Greening the Brown, we have continued to help clients decarbonize their business, whether through low-carbon and green fertilizers in various countries, green hydrogen in India, or a carbon capture feasibility study in Denmark. In Green Green, we announced our activities as we were awarded a feasibility study to produce sustainable aviation fuel based on NETSCAN portfolio of green initiatives inside the Port Harcourt refinery in Nigeria, while we signed an agreement for a feasibility study to realize a sustainable aviation fuel plant in the port of Notre Dame in the Netherlands. Moreover, we are very proud to have been awarded earlier this month a contract by Storengy, a subsidiary of Engie, to carry out an advanced basic engineering study for a waste wood and solid recovery fuel conversion plant to produce biomethane at Le Havre in France. NextChem and Storengy are also establishing a broader cooperation agreement in order for NextChem to act as a strategic partner, co-developer, and co-licensor. Finally, We are strongly engaged in implementing our Green Circular District model in different regions in Italy based on a set of technologies aimed at recycling plastic and unsorted urban waste to produce circular fuels such as methanol, ethanol, and hydrogen. We believe that Green Circular District are sustainable initiatives able to reach different objectives producing low-carbon fuels and chemicals, addressing waste management problems, enhancing national production of fuels, and creating new jobs and redeveloping brownfield sites or those at risk of being decommissioned. We continue to focus our effort on this side of the business, and we expect further developments in the coming quarters. All these significant and diversified new projects have translated into a sizable increase in the green energy backlog, which has gone up three times over the last 12 months to about 800 million euros. Such an increase has already translated to higher revenues and EBITDA, a trend that is expected to grow in the future. The backlog at the momentum is focused more on Europe and the Americas. along the same lines as where the commercial opportunities are currently located, as shown by the data included in the following slide. The other side of the coin of the green energy expansion is given by an increasing commercial pipeline. As of the end of last June, we were pursuing opportunities worth 7.5 billion euros, up 900 million this year. While Europe remains the largest geography, we are experiencing an increase in opportunities in other areas such as in Asia and especially the Americas. Finally, before we analyze our financial performance, let me give you an update on our ESG developments in the first half of the year. Our commitment to sustainable value creation remains strong as our ESG principles are embedded in our development plans and in our day-to-day operational decisions. In these first six months of the year, we have worked hard and successfully to implement our sustainable strategy, which is centered around environmental sustainability, the value of our people, and of the territories where we operate. and the innovation which relies on our technological DNA. Our Met Zero Task Force is implementing a vertically focused action plan to reduce the emissions generated by logistic procurement, the energy consumed by offices and travel, and finally the activities at our construction sites. We have already engaged more than 20 suppliers, and we have implemented a carbon tracker tool to measure their emissions. While we maintained our best-in-class positioning in health and safety KPIs in our industry, We also started the action plan of our diversity, equality, and inclusion work group that carried out a self-assessment on gender equality based on the United Nations Women's Empowerment Principles and Valor Day, a gender equal Italian group of over 200 firms where our group belongs. The outcome? of these assessments have been positive and represented an important stimulus to continue with the 39 initiatives, including providing internal training on these topics. We are strongly committed to developing a sustainable supply chain and as promised in our target for 2022, We have already carried out the social audit for five selected key suppliers in social high-risk geographies, while the number of ESG screened suppliers has increased to over 2,200. On the technological innovation front, alongside our portfolio of green technologies, We continue to develop our digital platform, which represents an important added value for our customers. We are proud of the achievement we have reached so far, but we are also committed to continuing our successful journey in order to further improve our ESG impact. And now I hand over the microphone to Fabio, who will discuss our financial performance. And then I will be back to provide you with some financial remarks. Please, Fabio.

Thank you. Thank you, Sandro. Our first half revenues grew 21.7% to 1,615.4 million euros. Such an increase is mainly due to last year's acquisitions starting to provide a positive contribution to our top line. As growth continues to consolidate in the next few months, second-half revenues are expected to be higher than in the first half, as communicated last May. Business profit was 137.9 million euros, up 10.2%, thanks to the revenues increase. GNAs were 36.5 million euros, a decrease of 4.5 million, or 11.2%. This remarkable achievement is due to our continuous attention to cost improvements across our organization. As a result, the percentage of these expenses of revenues has decreased from 3.1 to 2.3% over the last year. R&D have remained relatively stable, mainly driven by our green energy expansion. EBITDA was 97.4 million euros, up 21.8%, with a profitability of 6%, in line with the previous quarters and with this year's guidance. Net financial charges were 13.7 million euros and were mainly impacted by a higher derivative mark-to-market valuation, also related to the buyback of our own shares and by a marginal increase of the gross debt. Such positive operating performance has led to a consolidated net income of 40.6 million euros, up 10.7%, and the group net income of 42.2 million euros, up 5.5%. Moving on to the balance sheet, let's analyze the cash flow dynamics. Our adjusted net financial position has improved for the ninth consecutive quarter and now stands at 44.1 million euros. Such an improvement has been driven by a significantly healthy cash flow generation of 149 million in the first half, as projects shifted gears in the second quarter and delivered over 160 million euros of cash flows. This positive cash generation more than compensated 60 million in dividends and 34 million in additional outflows due to taxes, net financial charges, capex, and acquisition of treasury shares. We expect this virtual strength to continue in line with the guidance provided at the end of February. Let us now take a look at the working capital dynamics. Working capital has improved by about 90 million euros to negative 95.3 million. Such an improvement has been mainly driven by the positive effects of project advancements on advances to suppliers and account receivables. The rest of the items do not present significant variations in the semester. I now hand over the microphone to Alessandro for his concluding remarks. Alessandro.