NEXI S.P.A.

Good morning. This is the Coral School Conference operator. Welcome and thank you for joining the NEXE nine-month 2025 financial results presentation. 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. Paolo Bertoluzzo, CEO of NEXE. Please go ahead, sir.

Good morning, good morning to everyone, and welcome to our nine-month results call for 2020-2025. As usual, I'm here with Bernardo Mingrone, our Deputy GM and Chief Financial Officer, with Stefania Mantegazza, Leading AR, and a few more members of our team that may help to answer your questions as needed. As usual, we start with the summary of the key messages. I will hand over to Bernardo to cover the results in more detail, and I will come back for the closing remarks, and most importantly, to answer to your questions. Let me jump to page three with the summary of the key messages. First of all, we continue to deliver profitable growth for the nine months and in the quarter. Revenues are up 2.8% for the nine months and 1.8% in the quarter. As anticipated in the third quarter, We see more material effect of this trading event that we have anticipated when we provided the guidance in March this year. More precisely, we're talking about the bank losses from the past and some key bank contract price and negotiation effects. These effects will peak probably in Q4 this year, and then we'll start slowing down across 2026 with a more material reduction in the second half. The underlying growth, therefore, net of this effect is at about 6% year-on-year, both in the nine months and in the quarter. Merchant solution revenues are up 2.7% in the nine months and 0.6%. versus the same quarter last year, with underlying growth being at around 5%, 5% to 6% in both the nine-month and the third quarter. EBITDA is growing at about 3.5%. in the nine months with a 35 basis point margin expansion. The quarter results in terms of margin are a bit affected by the revenue mix that sees a stronger IES and some operating cost phasing. Second key message, we continue to shape NEXI for future profitable growth. Three key points that we want to underline. We continue to progress our strategy execution in the integrated payment space. the space of convergence across payments and software. As discussed in the past, our strategy is based on partnerships with ISVs, and since the beginning of the year we've added another about 50 partners, ISV partners, to our pool that is about 500 across all our geographies. Second key message that we want to reiterate, we continue to build a stronger multi-channel approach to the Italian market, obviously still leveraging our very strong partnerships with the Italian banks, but also adding to this strong channel also complementary channels, targeting more precisely SMEs, that is our core focus. And these complementary channels by now represent year-to-date about 26% of our total new sales. Last but not least, we want to underline that merchant solutions in Germany is growing double-digit in the nine months, even accelerating in the third quarter, supported by customer base and market share growth. And we really want to stress this performance in Germany because obviously there's a lot of debate around how strong players like Nexi are in competing with the newer players focused on SMEs, the single platform runs and all of that. And clearly the performance in Germany shows very well that we can compete, we can win effectively and have accelerated growth as well. The third key message we want to deliver is that we continue to create value for our shareholders. Across 24 and 25, we did deliver 1.1 billion euros of capital to our shareholders, while becoming at the same time an investment grade issuer since the end of last year. Net financial debt is now down to 2.6 times that. EBITDA, notwithstanding the fact that we have returned in the year already €600 million to shareholders as remuneration, which is a 20% increase versus the previous year. Obviously, in March 26, we will talk about the capital allocation for 2026 on the back of the more than €800 million cash that we will generate in 2025. Coming to guidance, we confirm we lend revenues the low to mid single digit year-on-year growth space. We confirm that we generate excess cash for more than 800 million euros with high degree of confidence. As far as the margin is concerned, for sure it will be positive with Q3, with Q4, by the way, seeing a margin expansion better than Q3. Where it will land precisely will depend on the volumes we will see in Q4 and the business mix that we will see in Q4. In any case, we are talking about only a few million euros here and there. Let me now hand over to Bernardo to go through the results more in detail.

Thanks Paolo, good morning. Starting on slide number five with revenues, as Paolo has already mentioned, this quarter was significantly impacted by discontinuities as expected. This has been accelerating throughout the course of the year. You can see the revenue growth in the quarter of 1.8% is distant from our underlying growth of 6%, and this gap is widening compared to the nine months. So as we said, this is the highest impact we've had year to date. and the peak is expected to be reached in the coming quarter. With regards to EBITDA and EBITDA margin, EBITDA is growing. The margin, and please remember we're always talking about an EBITDA margin north of 57%, suffered in the quarter from what I would characterize as a slightly different revenue mix than what we might have planned with a bigger contribution coming from issuing the merchant solutions. and also a bit of phasing effect on some costs, which might have spilled over from one quarter to the other, which is impacting the margin accretion. However, for the year, we are positive at 35 basis points. Moving on to merchant solutions on the next slide, we have growth in the quarter. Again, here, this is the business unit on which the negative impact coming from the discontinuities we've talked about impacts us the most. You can see the underlying growth is mid-single digit. Overall, I think we can point to continued growth in international scheme volumes, albeit with a softer summer. We have a slightly unfavorable volume mix, as I was mentioning earlier, as a group, but also within merchant solutions with some pricing and mix effects in e-commerce in Poland. We're talking about Sorry, just a few million euros here, but that makes a difference, obviously, in terms of year-on-year growth. I think more importantly, from a volumes perspective, Poland, but more importantly also Germany, which is growing in the quarter, in the mid-teens, have shown a robust performance. We continue to grow our franchise in the most valuable segment of SMEs. We continue to upsell and cross-sell our value-added products and services And indeed, we're making progress on the ISV partnerships front with more than 50 signed in the nine months or in the year to date. Issuing solutions at a very strong quarter, 6.5%, 6.6% growth. This, as usual, has been sustained by volume growth. The international debit product in Italy upselling and cross-selling throughout the group. I think it's fair to say that part of this higher performance in the quarter than for the nine months will be reversed in the fourth quarter. We expect it to benefit less from year-on-year project work, which, as you know, as we've discussed in the past, it's very hard to predict in which quarter they will be booked. And we're also expecting in the fourth quarter to see – The first effects of some insourcing from a large Nordic client that we've spoken of many times in the past is something, a decision which goes back three or four years and has been postponed a number of times and is now kicking in. So the fourth quarter is softer than the third, but a strong year to date and expected for the full year in any event on issuing. DBS is the business unit which has the most reliance on, let's say, project work and one-off billing, so it's lumpier. I don't read too much in the quarterly performance. Overall, for the year, we expect growth and a good performance from the business unit. Indeed, we recently launched in October a very important piece as part of our payments business, the verification of payee, which affects hundreds of banks across Europe. We're the largest player in the space, and this was a big success for us. From a geographic perspective, it doesn't surprise that Italy is the region which was impacted the most by the discontinuities of the Italian banks that we've spoken of so many times. Nordics, I would say, good performance in the low single-digit area, but benefiting from continued progress on selling value-added products and services to our client base. DAC, I would say very strong performance in Germany, slightly less so in Switzerland, but overall good performance from the region. And CSCE, which is probably the most impacted by the softer summer and what I said earlier about Poland. Finally, before handing the floor back to Paolo on costs, costs grew about 3% in the quarter. HR costs still showing the benefits of the initiatives which were put in place last year and continue to be implemented during the course of this year. Slight growth coming on the non-HR costs, which is the one most impacted by volume growth, by inflation, by the growth of our business in general. But as you know, we manage our cost base as a whole, and you can see the 2% growth for the nine months is pretty much in line with our expectations, and I don't expect a the final part of the year to be any different. Actually, the fourth quarter expected to be better than the third and probably better than the nine months to date. So I think other than the phasing effect, which I mentioned earlier, which has to do with intra-group VAT and the timing of these things, and again, we're talking about a few millions of euros here and there, I would expect strong cost performance for 2025. So let me hand the floor back to Paolo for his final remarks.