Hello everyone, this is Andreas Trösch from Investor Relations. Also on behalf of my entire team, I wish you a very warm welcome to our conference call on the 9-month results 2025/2026.

With me in the room are our CEO, Miguel López, and our CFO, Axel Hamann, and also my colleagues from the IR team. Before I hand over to the CEO and CFO for their presentations, some housekeeping: all the documents, as usual for this call, are available in the IR section on the website.

The call will be recorded and a replay will be available shortly after the call. After the presentations, there will be the usual Q&A session for our analysts.

We use Teams for the call again. In order to ask a question, you have to push the raise your hand icon and we will announce your name and open your line.

If you are on mute, you must unmute yourself in addition. With that, I would like to hand over to our CEO, Miguel López.

Thank you, Andreas, and hello everyone. Welcome to our Q3 conference call.

The key message for Q3 is clear: execution continues to move forward, even against a still uncertain market backdrop. As usual, I would like to give you a concise management summary for the third quarter of fiscal year 2025/2026, covering our performance, our portfolio progress under APEX 2030, and the key milestones with regard to our green transformation efforts.

On portfolio and APEX 2030, the transformation of our headquarters towards a financial holding company is in execution. This goes hand in hand with a declining cost base over time.

Last year, we demonstrated that we can successfully execute spinoffs and establish independent businesses when we brought TKMS to the capital market. Since then, TKMS performance has clearly validated our strategy and proven the strength of its standalone investment case.

This is also reflected in recent major orders worth billions of euros, including the contracts from the German armed forces for service vessels and the contracts from the Canadian government for submarines. As a strong anchor shareholder, thyssenkrupp AG continues to actively support and accompany TKMS in its further development.

We now intend to follow the same path with TK nexilis, our Materials Services segment. The spinoff is on track.

I will come back to this on the next slide. On Steel Europe, the clear focus is on restructuring towards profitability and independence of the segment following the HKM exit in July 2026.

This really has been a historic milestone for thyssenkrupp and the overall Steel segment. Looking ahead, we are planning to host a dedicated Steel Europe Capital Markets Day at the end of September in London to update all of you on our transformation journey.

With regard to TK Elevator, the value crystallization continues following the coinvest from earlier this year. Now, only a few remarks on performance as Axel will provide more details in the financial section of today's call.

Operationally, we see a further step-up in performance, also driven by restructuring benefits that are becoming more and more visible. The group outlook is lowered for sales, narrowed for EBIT adjusted, and confirmed for free cash flow before M&A.

Regarding the political and regulatory framework, the steel tariffs got effective in July. Thus, they are not yet fully reflected in our results and they should provide additional upside going forward, especially for the upcoming fiscal year.

Now on green transformation. Uhde delivered a successful ammonia converter modernization in Turkey with a 13% production boost, while Polysius reached an important oxyfuel demonstration milestone with a CO2 capture potential of up to 95%.

At Steel, the DRI plant construction continues with full commitment as it remains central to our pathway towards green steelmaking in the future. Turning to TK nexilis, our upcoming spinoff remains on track.

The enhanced standalone equity story and increased midterm targets were presented at the Capital Markets Day in July and attracted the interest of the investor community. The planned structure is a 49% minority spinoff, while 51% remain with thyssenkrupp and therefore continues to be a fully consolidated segment.

The financing framework is in place, including a borrowing base financing agreement in the amount of €1.7 billion. Shareholders are expected to receive one TK nexilis share for every 20 thyssenkrupp AG shares, enabling them to participate directly in TK nexilis' growth and value potential.

The Extraordinary General Meeting on August 7th was successfully conducted with broad approvals. The next major step is the listing within this calendar year in the Prime Standard of the Frankfurt Stock Exchange.

Now, Axel, the stage is yours for the financial section.

Thanks, Miguel. Let's turn now to the financial overview for the third quarter.

Overall, the main challenge remains the limited visibility on macroeconomic development in addition to quite muted demand across several customer groups and regions. However, the financial overview shows that our strict performance management is translating into tangible bottom-line results.

Let's have a look into some details. Sales in the third quarter were €8.8 billion, up 8% year on year, showing a promising momentum.

For the first 9 months, sales were €24.4 billion, down 1% year on year. That is considering portfolio and currency exchange effects.

Sales were up +9% and +2% respectively. Let's get to EBIT adjusted.

It improved to €183 million in the third quarter, and that is an increase of €28 million year on year, and reached €591 million for the first 9 months. That increase was also driven by our restructuring efforts.

In that regard, workforce reduction is progressing well with FTE down by approximately 3,500 year to date. Let's talk about net income.

Net income improved to €34 million in the third quarter, supported by write-ups at Steel Europe following a more efficient production setup considering the HKM exit Miguel just mentioned. The 9-month figure remains negative at -€311 million, mainly on the back of the proceeding restructuring provisions in Q1 that you are all aware of.

Talking about free cash flow before M&A, that was -€140 million in the quarter, improving by €140 million year on year. That leads to accumulated 9-month figure of -€1.9 billion.

Overall, important to note that reflects our usual cash flow pattern that will reverse in the running quarter. Miguel has already mentioned that we do confirm our full-year guidance for free cash flow before M&A.

With regard to our balance sheet, we maintained a solid net cash position at around €2.6 billion. In order to conclude the financial overview for the group, the key message is quite straightforward: we are executing strongly on performance management and at the same time preserving balance sheet strength while staying realistic about the macro and demand environment.

Turning to the next slide, this provides a high-level view of sales and EBIT adjusted development in the third quarter. On sales, overall message is that top-line development shows a promising momentum.

Improvement was especially supported by Materials Services, now TK nexilis, with positive effects from prices and volumes, while other segments, such as Automotive Technology and Decarbon Technologies, still faced pretty low demand. Let's get to EBIT adjusted.

Overall increase was mainly driven by Steel on the back of restructuring efforts and more favorable raw material costs. In addition, Materials Services and Marine Systems also posted pleasant year-over-year increases.

These developments more than offset the declines in Automotive and Decarbon Technologies. In short, the quarter demonstrates that our performance measures are becoming increasingly visible in the numbers, even though we're not yet seeing a broad-based market recovery across all segments.

Let's turn to our segments. First, Automotive Technology.

The key message for Q3 is that we are continuing to manage through a soft market environment while staying focused on restructuring and internal countermeasures. Sales remained under pressure year over year, mainly reflecting softer demand in the serial business.

At the same time, continue to see growth in the Aftermarket group and forged technologies. Please also keep in mind the M&A effect from Automation Engineering with closing of the transaction at the end of March 2026.

Hence, from an organic perspective, sales were rather flat. On profitability, EBIT adjusted declined in the quarter.

Restructuring benefits and our internal countermeasures are visible, but they could not fully compensate the lower volumes and higher special freight costs. On BCF, business cash flow, the development was quite encouraging.

Lower investments, improved net working capital, both more than offset the earnings decline and restructuring cash outs. As a result, business cash flow improved year over year.

In summary, demand in Automotive remains challenging, but the operational measures are gaining more and more traction. Let's move on to Decarbon Technologies.

At Decarbon Technologies, we're still facing a pretty hesitant project environment, mainly in the chemical plant business. Customers continue to postpone projects, which together with the usual volatility in the project business leads to weak order intake and therefore decreasing sales.

The main driver of the sales decline was plant engineering, and these deteriorating sales negatively impacted our EBIT adjusted in the third quarter. That was also affected by project-related additional costs in the cement business coming from past legacy projects.

Performance measures and efficiency gains resulting from our ongoing restructuring and purchasing optimization could support earnings, however, were not able to fully compensate for the decrease. Positive news on the last KPI on this slide: DT was able to raise business cash flow, mainly on the back of temporarily favorable payment profiles.

Let's move on to Materials Services, now known as TK nexilis. TK nexilis delivered a clear earnings improvement, supported by a favorable market environment, especially in North America, but also in Europe.

We saw strong growth in sales that was driven by materials and processing business in Europe and North America with significantly higher shipments, particularly in direct-to-customer businesses and on the back of distribution and processing volumes. Let's take a look at earnings.

EBIT adjusted significantly increased due to supportive market conditions and a very strong operational performance, with the North American operations delivering the strongest earnings uplift. In addition, our processing business as well as the European materials business also performed positively.

Talking about cash flow, our business cash flow benefited here from higher earnings, partly offset by price-increased net working capital buildup. Moving on to Steel, Steel Europe, their sales increased in the third quarter, driven by higher shipments, particularly from automotive and industrial customers.

However, pricing there remained under pressure, especially in packaging and electrical steel. Moving on to EBIT adjusted, that improved significantly in the third quarter and more than doubled year to date.

That was mainly driven by restructuring measures, our hiring freeze, operational excellence initiatives, and lower raw material costs. Cash flow, our business cash flow also improved year over year, supported also by government funding for the direct reduction plant that is progressing.

Overall, self-help measures continue to deliver tangible results and help offset the challenging market environment. Last but not least, Marine Systems, TKMS.

As usual, only a couple of brief comments on Marine Systems, as all operational details have already been presented yesterday, but it's without saying that we as a majority shareholder are more than happy with the development of our segment. Marine Systems continues to build a strong foundation for future growth, supported by an order backlog of more than €20 billion.

Let's move on to our EBIT adjusted bridge to net income. Looking at the special items, we saw a slight net positive effect that was mainly driven by the HKM exit from early July and its implications, and most notably, write-ups at Steel Europe of round about €400 million in light of a more profitable business outlook of the remaining segment without HKM, as well as the respective impairment losses of €276 million by classifying HKM as a disposal group discontinued operations.

Please note that the actual deconsolidation of HKM with a negative low-three-digit million-euro impact will be included in our fourth-quarter accounts. The remaining positions are rather straightforward.

After the financial results and taxes, net income for the third quarter came in at €34 million positive. Next chart, our third-quarter reconciliation to free cash flow before M&A.

As you can see, in the third quarter we did not face any material net reconciliation items. Investments are net positive in the quarter, mainly on the back of funding for the direct reduction plant at Steel Europe with an amount of €252 million.

The M&A adjustment includes the proceeds for the sale of the remaining stake in AST in the range of a high double-digit million-euro figure. Overall, that led to a free cash flow before M&A of -€140 million.

While the quarterly figure remains negative, it improved year on year and continues to reflect the typical seasonal cash flow pattern. Let's have a closer look at our outlook for the remaining year.

As Miguel already mentioned, for the full year, we are lowering our group guidance for sales and narrowing for EBIT adjusted while confirming for free cash flow before M&A. Let's have a look at the details.

For the group, sales are now expected to be between -3% and -1% versus the prior year. EBIT adjusted is now expected in a range of €600 to €900 million compared with our previous range of €500 million to €900 million.

Free cash flow before M&A is confirmed at -€600 to -€300 million, including lower restructuring cash outs of up to €250 million, as well as a somewhat lower CapEx guidance of €1.2 to €1.3 billion. Net income is expected to be between -€700 and -€400 million, including restructuring provisions mainly at Steel Europe.

At a segment level, there are several adjustments that led to the updated group guidance. Let me highlight a couple of them.

We raised our guidance for sales and EBIT adjusted at Materials Services and Marine Systems. We also raised our EBIT adjusted guidance for Steel Europe while becoming a bit more cautious in terms of sales expectations.

Overall, the guidance reflects improved operational execution while maintaining appropriate caution on market visibility. With that, Miguel, it's up to you again.

Thank you very much, Axel. Let me wrap up today's call with five key messages.

First, we are changing the setup of thyssenkrupp AG into a lean financial holding company. That transformation is in execution.

Second, the TK nexilis spinoff will be the next visible proof point in delivering on APEX 2030. Third, on the Steel Europe Capital Markets Day at the end of September, we will provide transparency on the recent progress and milestones that we have reached.

Fourth, we will continue to take an individual approach for each business, including the necessary restructuring to secure sustainable success. Finally, we will leverage the opportunities arising from the green transformation.

With that, we are at the end of today's presentation. Thank you all for your continued interest and trust.

Axel and I are now happy to take your questions. Andreas, back to you.

Thank you very much. We are now coming to the Q&A session.

The drill: please go to Teams and use the raise your hand button and then please unmute yourself. The first question is coming from Ephrem Ravi from Citi.

Ephrem, please.

Thank you. Three quick questions.

Firstly, should we see the Steel Capital Markets Day as sort of a prelude for what you kind of have done for Marine Systems and nexilis, i.e., kind of a spinoff with holding and then 1:20 shares, or is this not kind of a signal to the market that that's the current preferred route of how to kind of unlock value in that business? Second question on sort of Steel Europe again, the reduction in sales guidance, but upgrade in EBIT guidance, should we kind of take that as more lower volumes, but obviously higher prices and profitability that you're expecting for the last quarter of the fiscal year?

Third and final question, sorry to ask this, I know this is a boring and standard question, but Rhine River levels in terms of impact on raw material cost and for finished product logistics cost, could you give us a sense as to how much potentially volume impact or cost impact could be because of that development? Thank you.

Thank you very much for the questions. I would like to start with how to frame the Steel Capital Markets Day end of September.

Actually, as explained, we have been concluding three major milestones in Steel, which was in December the agreement on the restructuring plan, then as mentioned, also the HKM agreement and deal, and third, obviously very important as well, is the European Union tariff increase and quota reduction, being in place since July 1st. This three major events need to be, in our belief, better explained.

That's the reason why we are doing this Capital Markets Day end of September in order that the impact from this three very important milestones can be interpreted in the right way by you. That's the motivation for doing this Capital Markets Day.

That we are driving also Steel into a independence, I think this has been communicated. This is very clear.

We should, first of all, inform about the three major things that happened, and we take it from there.

All right. Hi, Ephrem.

Maybe I start with your question on the Rhine River situation. That's something we're monitoring on a daily basis.

Steel has set up a a dedicated task force for that. We are slightly adapting logistics and also taking cautious measures at our production.

I cannot yet tell you any potential impact. Let's see what the next weeks weeks bring.

There is a laser focus on the topic, and production is is is all on it. Second, with regard to your question, Steel fourth quarter, exactly as you said, assuming lower volumes and somewhat better pricing.

Thank you.

Sure.

Thanks, Ephrem. Now the next in line is Dominic O'Kane, JPMorgan.

Dominic, please go ahead.

Thank you. Thanks for taking my question.

I have two questions. Again, going back to Steel Europe and the guide that you've given for the full year.

I guess my question is to what extent is the guide overly conservative or is it signaling quite significant weakness for Q4? Obviously, if we look at your 9 months realized adjusted EBIT, you're at €373, you're already comfortably at the midpoint of the range.

Given what you're seeing at the moment in terms of a slowdown in Europe, is Steel Europe profitable at adjusted EBIT for Q4? Again, I just want to get a sense of are you actually signaling a materially weaker Q4 at Steel Europe than I think ourselves and consensus might be expecting?

My second question, again just maybe going back to the group structure and the success that you've clearly had on TKMS and nexilis coming up, how are you thinking about whether the 51% long term is the right ownership level? Again, we're at a situation where at the moment we obviously have kind of peak demand for defense, a very very strong performance for that market.

How are you thinking about maybe monetizing the opportunity and the strength that you see for both TKMS and nexilis at the moment? Thank you.

Should I start with your last question? I think it has been a very successful start that we did with Marine System, and also we expect a good start with TK nexilis with our 51% ownership.

There is no plans in the future to monetize that or to change that so far.

All right. Dominic, let me try to answer your question on our steel guidance.

I'd say in your words, it's more caution than weakness. Caution is due to a couple of factors.

Uncertainty on energy prices given the quite volatile situation in and around Iran. Then we've touched upon the Rhine River situation, that's also something we need to monitor.

There is some upcoming and planned maintenance, so that is probably the underlying reason for what we would call more caution than weakness.

Could you maybe just elaborate on the maintenance, how long will the maintenance be affecting the plants?

It's not an overall maintenance. You're aware that that plant consists of many huge aggregates.

I'd say a major maintenance period is now upcoming for round about two quarters. It's regular business, and that's something we need to manage.

That will be Q4 and Q1, just to be clear?

Q4, Q1, and also lingering into the second quarter.

Thank you. Thanks very much.

I'll go back to the queue.

Thanks, Dominic. The next in line is Jason Fairclough, Bank of America.

Jason, please.

Hi guys. Thanks so very much for the presentation and for the opportunity to ask questions.

Two for me, please. First one's on nexilis and then just a follow-up on steel.

In nexilis, obviously a big increase in profitability, and I'm just wondering if you could give us some color on how this might be helped by inventory effects from materials that were perhaps previously acquired at a lower price and are now being sold for higher prices, versus how much is actual structural profit uplift from running the business better, perhaps in anticipation of the spin? That's the first question.

Second question is on the steel business. It's a bit of a turnaround here, right?

You previously effectively were looking at giving this away for free. You've now got the TRQ, you've got the announced restructuring.

Are you willing to confirm a potential profit uplift in steel from the labor restructuring of say €400 to €450 million?

Jason, this is Axel. Maybe let's start with nexilis Materials Services.

The uplift that we are mentioning, the majority is based on volume, but it's also due to the effect you've been describing, selling materials at higher prices. It's a mix of volume and price increases.

For steel, can you specify your question maybe? What do you mean with 400 to 500?

You've got I think in total 11,000 people who are leaving the business, 5,500 are leaving, 5,500 being outsourced. If we think about 5,500 in the cost of a steel worker, if we think about the run rate profitability of this business, it could be several hundred millions of euros better than it has been historically.

Is that the right way to think about it? I guess I'm just trying to think about the profit potential for this steel business and how it's evolving versus what it was two or three years ago.

Jason, this question energizes me a lot, to be honest. I think this is exactly the reason why we are now doing the Capital Markets Day end of September, because we want to be transparent in what the different buckets will be impacting the bottom line.

Please stay tuned until end of September, and I would like to see you in London, and then we will get you and all the other market participants then informed about what the three big things that I mentioned before will be in terms of bottom line and also in the medium term. It's indeed something very very important to communicate.

Just so that I understand, historically there was a dual track here, which was separate the steel business through an IPO like we've done already with Marine, like we're doing with nexilis, or potentially pursue a trade sale to a third party. Would you confirm that the focus today is very much on door number one?

Definitely.

Thank you.

You're welcome.

Thanks, Jason. Next in line is Boris Bourdet from Kepler.

Boris, please.

Hello gentlemen. Thank you for taking my questions.

Just as a follow-up on Jason's question on the steel CMD and potential spinoff, would that be a minority spinoff or would that be a majority spinoff? Because I remember in the past you were really much looking to make that business independent.

Given the three elements you've outlined, like the TRQ, the restructuring, and the deal on HKM, do you see now the lines moving in terms of potential buyers? That's the first question.

The second question would be on restructuring. I haven't seen provisions for restructuring moving so much quarter on quarter.

Is it something pending that we should expect in Q4? Maybe a very last one on the DRI plant.

I remember the total investment was a gross investment of €3 billion, financed up to €2 billion with public funding. I've seen press release this morning pointing to potential renegotiations.

What could be the upside here? Thank you.

All right. Boris, it's Axel.

Maybe on the DRI, you're totally right, overall volume of round about €3 billion, funding or public funding is €2 billion. There is no renegotiation on the financial terms or fundings.

There is talks around to what extent we need to let's say use hydrogen in the first instance. That is something we have been very successfully and very positively negotiating with both the EU on a EU level, but also on a national level.

From a financing perspective, nothing's going to change: €3 billion overall, let's say CapEx, and of that €3 billion, €2 billion is publicly funded. That is with regard to DRI.

Then your question with regard to restructuring provisions, there is not much more to expect in the remaining year. We've done our restructuring provisions mainly for steel in the first quarter, and that is also important to realize in the first quarters we have somehow anticipated restructuring provisions for HKM.

However, as we have now sold our shares to Salzgitter, and that is why that's not going to be any restructuring provisions on HKM anymore. I guess, Miguel, you're going to take the

Regarding your question about a spinoff in steel, majority, minority, I would like to indicate, let's please do step by step. The next step, and that's the reason why we announced it the other day, the next step is to get the Capital Markets Day for steel end of September.

There we will inform about, as mentioned before, the three major actions that we did put in place: so the restructuring agreement, HKM, and also the increase of tariffs and a reduction of import quota into the European Union and the respective bottom-line impacts that we will see over time regarding these three impacts. Then with the CMD being done, we will then take one step after the other.

No decisions are made, and as said, we have been making a lot of good experience with getting really very organized step by step, and we will do so the same way for steel.

Thank you.

Thanks, Boris. Next in line is Alain Gabriel from Morgan Stanley.

Alain, please.

Thank you for taking my questions. I have three short questions.

The first is on HKM and the impact of that business that it had on Steel Europe. Now that you're stripping out HKM, can you give us an order of magnitude of the impact of that business, upside or downside, to your underlying Steel Europe EBITDA or EBIT in that sense?

That's one. Then two on TK Elevators, if you were to hypothetically sell your stake today, would you be incurring any capital gains taxes or do you have some tax losses that you can write off against it so that you can sell it at market value?

Then three is on your free cash flow guidance. You've lifted your EBITDA or EBIT, you've cut your CapEx, and yet your free cash flow remains unchanged.

Presumably this is entirely a change in assumptions on the net working capital, or is there anything else that you've changed? Thank you.

All right. Thanks, Alain.

Maybe let me start with HKM. We cannot quantify the the EBIT impact, but I think I can give you a bit a little bit of let's say recalibration.

We were able, by selling HKM, we were able to write up our steel business at an amount of around €400 million. That should give us that should give you an impression let's say what the impact has been over the past years.

It's a positive impact our steel business that we have sold our shares to Salzgitter. That hopefully that put that into perspective, HKM.

Then free cash flow, it's still I mean we're expecting still restructuring cash outs. We have we have confirmed our guidance, again -€300 to -€600 million, and we are quite optimistic in order to to reach that guidance.

Can you specify your question with regard to TKMS? That wasn't so clear to me.

Yes, you do have it on your balance sheet at book value. If you were going to sell your stake, let's say at market value today, would you be incurring any capital gains tax or do you have some tax losses that you can write off against it so that you can sell it at market value?

I'd say from the top of my mind, capital gains tax would be insignificant.

Thank you. Clear.

Sure.

Thanks, Alain. Now the last one currently is Bastian.

In order to ask a question, if you still want to ask a question, raise your hand. Now, Bastian Synagowitz, Deutsche Bank.

Bastian, please.

Hey, good morning. Thanks for taking my questions as well.

I start off briefly on Automotive. I guess where you've been cutting your guidance, but I guess if we extrapolate what this now implies for your expectations on the fourth quarter, it would still be obviously an improved performance relative to Q3.

I guess usually there's also a bit of softening Automotive seasonality. Could you please help us to understand what's driving this improvement?

I suppose it is restructuring, but I guess when we look at the overall restructuring cash out, which you're guiding for, I think it's gone down to €250 from €350 before. Is this just a deferral, and why is the restructuring pace being slowed here?

That would be my first question.

All right. Bastian, this is Axel.

Automotive, remainder of the year. There's still some way to go, but honestly, it's a similar pattern you've seen throughout the past years.

Let's say, part of the automotive business is also claims management towards the end of the quarter, particularly towards the end of the fiscal year. That is something the guys from Automotive also pushing on heavily.

That is part of the reason or that's the major source why we expect Automotive to come up what we've guided for. Short answer is claims management.

Then second part is free cash flow, restructuring, yeah. Bastian, we're not slowing our pace.

The €350 million was also part of the figures was also related to HKM, which we're now not restructuring, but we're selling. The remainder is going to become visible also for the next year.

What we see is our FTE decrease in SE is currently still the majority coming from our hiring freeze, but the real restructuring is more and more kicking in, and that's something we're going to also report to you over the next quarters.

Great. Very clear.

Maybe just given that you mentioned HKM, maybe starting with that as the next question. I guess given that the transaction here is now finalized, can you just update us, I guess the provisions for any potentially future payments to HKM, will these sit in the Steel entity or in the parent entity, please?

Thanks for the question. Happy to answer that because we've made a clear cut.

We've transferred our pension provisions to HKM, nothing's going to sit with Steel or with TK

AG. Thank you, but I was actually referring more to any potential future payments for restructuring, decarbonization, where I thought there was still a I think you mentioned it in the last calls that some of the potential payments would be in a deferred way and come just in the future years.

Was just wondering will this be made out of the parent entity or of the Steel entity?

Okay. You're meaning the pattern.

Let's say we've guided a low to mid three-digit million-euro number for HKM, and that's going to come over the next 3 years and it's going to be catered for from Steel.

From Steel, yeah. Got you.

Perfect. Then just maybe looking at Steel again and just given the overall refinancing and separation you're currently working on on a business unit business unit level, can you already give us some color on the starting balance sheet which you're aiming for for Steel and whether you're planning to equip the entity with a certain portion of your net cash which you still have on a group level?

I guess when we look at nexilis as a comparable case, I guess it's been allocated actually with some debt on top of the pensions, and in Steel you've already been investing heavily over the last couple of years and now the economics are clearly improving. There's obviously a lot of restructuring underway.

Then there's obviously the pension restructuring and maybe still a bit of an unknown on decarbonization. What are your thoughts here?

Bastian, I totally appreciate your interest in that question, but it's too early to talk about. We're going to talk about the right capital structure for the business when time comes.

We're really looking forward to talking about the performance of the steel business in our upcoming Capital Markets Day in September.

Great. Then last one, could you maybe help us with how much out of the €3 billion budget for the transformation and DRI plant has been paid already relative to what is still due the next few years?

Again referring to what I've mentioned a couple of minutes ago, overall round about €3 billion, and of that €2 billion funding, and so far we have received round about €1 billion public funding.

Okay. How much have you been paying then on a gross level for the project?

If you say relative to the three, how much of the three have you been paying in total?

Round about a net payment after funding, this has cost us so far round about €300 million.

So €1.3 billion gross then, yeah. Got you.

Great. Thanks so much for the color.

Sure.

Thank you very much, and there's a follow-up question from Jason. Jason, please.

Thanks guys. Just wanted to chat a little bit about the pensions.

This is a bit of a bugbear for a lot of people in the market. I think historically you've said that about half of the €5 billion is associated with Steel.

Maybe you could give us a little bit of color about how much of the pension is actually leaving with HKM. Then again, as we think about all these businesses being deconsolidated, is it time to start thinking about an attributable pension liability rather than a consolidated pension liability?

Jason, this is Axel. You're right.

Pension provisions overall amount more or less to €5, €5.2 billion. It's also true that about half of it is with Steel.

What has been transferred to HKM is not a significant number. If I'm not mistaken, it's a low-three-digit million-euro number.

Yeah.

Okay. Again, on a go-forward basis, as we think about all these carveouts and spinouts and IPOs, historically the view was let's deconsolidate Steel and we deconsolidate half of the pensions.

Is that still a consideration or is that moved to a bit of a back seat?

It depends on the capital structure, and pensions, as is a part of the capital structure. Ideally every business, every segment is able to finance on its own its capital structure.

Does TKMS and so will do TK nexilis. To give you an example, with TK nexilis, we've also transferred pension liabilities that can be let's say tied to the business.

If we look at the annual cost flowing through the income statement is about €300 to €400 million, or is it €300 million, and then the cash payments is €400 million? I assume that's broadly correlated with the actual pension liability.

Again, if we look at that payment, half of that payment is being made by the steel businesses. Is that the right way to think about it?

That is absolutely correct.

Okay. I guess again I think we probably need to go in, have a think about just treating this as 100% consolidated debt.

Maybe feels like we're being a bit too harsh on it.

All right, understood.

Thanks, Jason. Now, Carsten Riek from ODDO, please.

Yes, hello everybody, and thanks for taking my question. Just one thing on a bullet point in the presentation where you said that you want to leverage your opportunities of the green transformation.

A question here: if this is within the existing, let's say, technologies and assets, or would you also look beyond? Some color here would be appreciated.

Thank you.

I think the green transformation has been driven in Decarbon Technologies on one hand and on the other hand in Steel with the DRI. We have seen over the last 3 years very hesitant markets in and around clean fuels overall, and of course also impacted by the regulations not clear, policy frameworks not clear, but also by a geopolitical impact.

Having said that, we are focusing, of course, very much still on the technologies that we have currently on hand, and that will be so for the next time as well. As soon as markets stabilize and we have a much better visibility of what will be coming regarding clean fuels, then obviously situation can change, but for the next coming time, we will exploit the technologies that we have right now on hand.

Thanks for clarification.

Thank you very much. That seems to be all from your side.

Thank you very much for participating. Thanks for all your questions.

If you have follow-up questions after the call, please call myself or the team. Thank you and have a great day.

Thanks everyone, bye-bye.

Bye-bye.