Good afternoon, everyone, and welcome to first half 2026 results conference call of Avio. I'm with Mr.

Giulio Ranzo, Chief Executive Officer of Avio, and Mr. Roberto Carassai, Chief Financial Officer.

In a moment, we will go through the presentation we just uploaded a few minutes ago on our website. At the end, as usual, we will welcome any questions you may have.

At this time, I turn the conference to Giulio. Please go ahead.

Thank you, Nevio, and good afternoon to you all, or good morning. Very glad to report to you the first half of 2026.

Nevio, can you jump to page 4 so we start with the highlights, and then our CFO, Roberto, will follow with some more financial details. If we are on page 4.

In essence, the first half of 2026 demonstrated again a sustained and solid double-digit growth in revenues and profits. Very consistent across the last few years as I will point out to you in a few minutes.

In this first half, we accomplished the 29th flight of Vega with a successful performance for the very first time with Avio as the launch service operator, which is a very relevant incremental responsibility we have. As this was handed from Arianespace to Avio on the occasion of the last flight.

Everything went extremely well. Now we're getting ready for the next flight on Monday night, and we will launch a couple of satellites for the European Commission and for the European Space Agency.

In this first half also, we successfully flew the new version of the first stage of Vega C and Ariane 6, the P160 boosters, which flew on Ariane on an Amazon flight with four boosters in a four-booster configuration. That's very important because it will fuel the rate at which we will now incrementally manufacture these boosters for Ariane.

By the way, I am in Paris at the moment. Arianespace just announced yesterday that they will launch additional six flights for the Amazon constellation, there will be many more P160 boosters to be manufactured, and we can only be happy about that.

Also, one very important milestone in this first half is that we accomplished the full integration of our liquid propulsion prototype rocket that will be ground tested in 2026 and then successfully flown in the course of 2027. That's a very important milestone with a radically new technology that will populate the future of our next-generation rockets.

In the meantime, we're making progress on our US project to establish a manufacturing plant in the US, as you know. Along this path, we have completed the hiring of our C-level organization, a new CFO with an operating officer, a Chief of Engineering, and so on.

The organization is shaping up. In the first half, we also had purchased land, as you may remember, a few months ago.

Then we have continued with our design for the plant, and now we are breaking ground at the end of the month with the actual beginning of works to erect the new plant. Also, in the first six months, we have raised additional €110 million from private equity fund Advent, as in a further capital increase that will further support the expansion of Avio both in Italy, but in particular in the US.

In aggregate, we have now raised over €500 million in the course of the last nine months or so. That's very important.

It's a lot of firepower available for our growth plans. In aggregate, we continue to deliver double-digit growth.

I would say 20% growth consistently now across the last four years. This is, I think, the emphasis that I would like to draw your attention to, because it's not so obvious that you continue to grow at 20% every year, four years in a row, and that seems to be the pace that we are now consolidating.

As a consequence of that, we're, of course, confirming guidance for the end of 2026, amid, of course, a number of uncertainties, as one can imagine, given the geopolitical challenges that we're all going through. At the same time, also some better-than-expected performances that we're also consolidating at the moment.

Moving to page 5, as I said before, the last Vega flight was a success. You can see from this page, it was the first to have a big Avio logo on the fairing, because it marked the flight in which we fully operate the flight and therefore, we take charge also of the flightworthiness responsibility vis-a-vis the French institutions.

We carried out a fantastic flight for the European Space Agency, delivering Smile, a very interesting scientific satellite, and the satellite was perfectly put in orbit with great satisfaction of the customer. It couldn't be any better, quite frankly, to demonstrate the full stretch of our capabilities all the way to flight operations.

Now on page 6, in the first six months, as I said before, we also had the first flight of the P160 booster on Ariane 6. This was a success that I'm particularly proud of, because I remember when we invented this solution together with Ariane in order to help in particular Amazon launch more satellites in a single flight.

We made it happen, it's a longer booster compared to P120 with about 16 tons more propellant. We are quite happy about that.

It performed extremely well, as you can see also from the picture. In particular, I believe that Amazon was happy enough that it led Amazon a few weeks or months later to now sign up for another six launches with Ariane.

We are very happy about that, because that will likely push the production rate of P160 faster and probably beyond what we had expected to be the rate of 35 boosters a year. We will probably, with the support of the European Space Agency, go somewhat beyond that level in order to increase the flight frequency of Ariane, and at the same time, also the flight frequency of Vega.

On page 7, as a matter of fact, we are marching towards the end of 2026 with what looks like we're probably going to have seven to eight launches of Ariane and three launches of Vega. We could have done more this year, but one satellite was somewhat late, but we are scheduled to have a launch next Monday and then another one at the very beginning of December, and more to come, of course, at the beginning of 2027.

Lots of different projects, as I said, in Ariane. This core customer Amazon, but also Galileo and some other core European institutional satellites.

Similarly, for Vega, we are now launching for the European Commission, the European Space Agency, but in December, we will launch the first batch of the Italian Earth observation constellation, Iride. That's a very interesting integration of a proprietary Earth observation constellation.

There will be more flights for the same constellation. A very active, dynamic market demand, growing demand for both Ariane and Vega, and this will drive both of us to simultaneously grow the maximum cadence of Vega and Ariane in the few years to come.

Switching gears on page 8 on research and development, we had reported to you all that we were developing an entirely new rocket concept leveraging liquid oxygen-methane as a technology using our MR10 engine. This is what the new flight demonstrator looks like.

This is a prototype rocket that will be capable to launch with this technology and lots of new technologies, especially in the avionics bay. This will be completely new, much more software-based.

Let's say we are experimenting here a whole number of technologies that will represent what we will have in next-generation rockets. What is interesting about this is it is a prototype that will be able to launch to space and also come back from space.

The main stage will have a controlled reentry. You can see from the pictures the so-called grid fins that will enable the first stage to also have a controlled reentry.

Lots of opportunity to learn, and we're quite happy to have reached this important milestone. Now we will proceed towards the end of the year to ground test this without flying yet, collect a lot of data, maybe fly next year.

Very, very important milestone. On page 9, some updates on the defense market.

The defense market continues to provide us with new orders every now and then, lots of orders from MBDA for the European Aster 30. We received in June another €35 million worth of orders, probably more orders to come in the rest of the year, in response to the growing demand for missile defense, given the geopolitical instability and the huge consumption of these products that we experienced in the course of the last three to four years.

As you can see, the orders are coming every now and then. It's very difficult for us to predict when they come, but we, as I reported to you, we know that more is coming for sure, not only from European customers, but also from US customers.

Then on page 10, let's review a little bit where we are on the execution of our Avio US strategy project, where we are essentially on track. As I reported, we acquired some 1,200 acres worth of industrial land in Virginia earlier this year.

We then signed up for all of the orders with the companies to develop the infrastructure in the US. We also agreed with the Commonwealth of Virginia for an incentive package that may be as big as $97 million to support basically the establishment in this part of the country.

As I said, we also broadened our team with a CFO, a Chief Operating Officer, a VP Engineering, and a VP Business Development. Based on this C-suite, we will then develop throughout the other ranks.

We have a whole pipeline of people we want to hire, and we will leverage the Commonwealth of Virginia funds to also recruit the rest of the team and train them over the next few months and years. There's a very robust plan to basically grow capacity not only by growing the assets, but also growing the human capital that we will need to succeed.

The Commonwealth of Virginia, starting from the Governor on down, they have a fantastic team to support us to make this happen, and I think it's a great piece of good news. In parallel, we are working long-term commitments from customers while we are deploying capital, of course, to the process equipment.

The long-lead items have been ordered, and some of them are under negotiation, but most of the long-lead items have already been ordered with the main suppliers. The detailed design of the plant is being finished up.

In the meantime, we will kick off with the groundbreaking ceremony and start the main works to develop essentially the land and therefore, shape up for the new infrastructure. On page 11, there's also one important point with respect to about a year ago.

A year ago, we presented to you our business plan, and while presenting our business plan, we explained to you that the solid rocket motor unmet demand, meaning the part of the demand that the supply is unable to deliver against, was already quite big. About a year later, we realized that this gap has further widened by another 40%.

Basically, the gap between total demand in terms of the tons of propellant required per year for the next few years appears to be even farther from what the supply capacity is today and for the foreseeable future until 2030. No doubt that the demand over the next few years will grow.

Still, in the next few years, even if we put in place a new capacity, the other competitors put in place new capacity, the consumption of these products is so fast that the gap will continue to grow, which means that the demand will surely be there and will exceed what we had put in our business plan, okay? Now, we have come up with a plant design that will enable potentially growing the size of the plant if we need to.

Now we have to see how this demand actually turns into contracts and commitment from customers. We will have to go through the flow-down from the government customers to the primes to the suppliers like us, but all I want to signal to you is that there is definitely more demand than we anticipated a year ago.

Moving to page 12, given that the demand is growing so fast, we figured we would be better off collecting more cash to be able to invest more quickly. We embarked on an agreement with private equity fund Advent to invest another €110 million to support a faster expansion.

Advent agreed to invest to acquire nearly 7% of Avio share capital at a price of €33.40, which, by the way, is higher than current market price and higher than the market price at which we executed the first capital increase, as you may recall, a few months back. We're very happy to have a very credible partner in the US.

Advent has actually done a number of deals in US defense companies with big names like Maxar and others. These deals ended up being successful.

They have grown these companies. Many of these companies were non-US.

They turned into successful, more successful US companies, larger. Some of them were sold to US primes like Ultra [unclear] to Lockheed very recently.

We think Advent is a very dynamic financial partner who can help us a great deal accelerate the pace of growth, accelerate in our ability to reach out for relationships in the US, and also for additional capital, should we need additional capital in the future. We count on them being a very good add-on into our cap table.

Last point on my pitch on page 13, I want to go back to the story of solid double-digit growth. Now, a lot of times, companies talk about growth prospects for the future.

They set out charts showing how big a hockey stick chart you can have for the future. Look at this chart.

This is the last four years what we delivered, okay? We delivered double-digit growth in terms of revenues and EBITDA, both, okay?

That's not easy to accomplish, because it means you can certainly capture orders from customers, you can follow demand, but then turning that into actual delivery of stuff, it's not that easy. The fact that four years down the road, we are consolidating a consistent double-digit growth pace of 20% is absolutely nontrivial, okay?

Now, what's happening is that our EBITDA reported looks small compared to revenues. Why is that?

Because a portion of that profit, as we anticipated to you a year ago, we are reinvesting in the US and growing the team and growing the capabilities, and so on. If we reach now nearly something north of €40 million worth of EBITDA reported, then a portion of that, as much as probably €8 million, let's say 20% of that EBITDA, is reinvested in the meantime in growing the US capabilities until this US capability would generate profits by themselves, pretty much by the end of 2028, beginning of '29.

At that point, they will start to be cash generative for Avio as well. That's pretty much our recipe for value growth that we have committed to all of you shareholders, and therefore, we plan on continuing like this for the future.

Now, I will hand it to Roberto Carassai to deliver to you the financial side of the presentation.

Thank you, Giulio. Good afternoon to everybody.

I think we can move on slide 15 so we can comment a bit on the backlog. As you can see, we are still having a huge backlog, more than €2 billion even in June, despite the very significant revenue growth that we have experienced even in the first half this year.

We have booked €160 million in the period, 2/3 of them coming from the defense and 1/3 coming from the launch system. It has to be noted that we have also booked a quite significant order for €60 million at the beginning of July coming from the launcher system business unit, just to say that this backlog could have been even higher if the booking of the order would have happened a few days before.

In terms of composition of the backlog, you can appreciate that the defense business is above 30%, 33%. It keeps growing also the contribution coming from the production contract that now have achieved 70% overall.

If we move to the next slides, here we can comment a bit more the revenue profile. As Giulio was saying, we keep growing at double-digit pace, 18% more than last year, achieving almost €280 million in the first half.

This growth, compared to last year, has been generated by all the three segments: clearly largely by the launch system business segment, but also space propulsion and defense have contributed in a quite significant manner. The launch system is the result of the growing in accordance with the flight manifest.

The space propulsion is increasing because we are increasing the production cadence for P120 and P160. The defense business is growing because we are increasing the production on the two major projects, Aster and CAMM-ER, but also we are starting the execution of the US contract.

In terms of the composition, even on the revenue side, you can appreciate that the production contracts are now contributing for almost 70% of the total revenue. Moving to the next slides, here you can appreciate the overall picture of the profit and loss results.

Overall, we can say that along all the lines, we are doing better than last year. Obviously, we have already commented the growth on the revenue side that has driven the growth at EBITDA reported.

The EBITDA achieved the number of €12 million compared to €10 million last year. As Giulio was highlighting before, please note that Avio S.p.A.

in Europe has generated almost €15 million of EBITDA in the period with operating costs coming from the USA company for almost €3 million. In terms of EBIT reported, despite a slight increase on the depreciation cost, we have been able to generate a positive result of €1.2 million.

Last year was zero. In terms of net income, actually, we have generated a very significant result, positive result, €9 million-plus.

This is the result, the consequence of the good operating performance, but also from the good financial income that we have generated on the average cash holdings that we have on our account, in the range of €5 million. Then we have also benefited from a fair value adjustment on a minority participation.

Moving in the next slide, on the net financial position, we are going exactly in the direction that we were expecting at the beginning of the year. We clearly explained that we would have a cash disbursement over the course of 2026, mostly related to the CapEx that we're going to incur both in Italy, but also in the US for the project, the special project.

Therefore, here you can see that we have had, let's say, a reduction of the net financial position of almost €60 million in the first half. Nonetheless, we are still having €535 million positive net financial position.

The other main driver of the reduction of the cash absorption in the period is related to the working capital side. As you may recall, we have booked a significant amount of advance payment at the end of last year, and now we are progressively releasing part of it to our subcos and, let's say, suppliers.

If we can move on the next slide, here we are commenting a bit the balance sheet. We have actually bit covered already, you can see an increase in the working capital that, I remind to everybody, is structurally negative for our company.

Also you can appreciate that there has been an increase on the fixed asset due to the CapEx that we have incurred in the period. We have already commented the negative variation on the net financial position.

Then in this slide, you can appreciate the quarterly evolution at EBITDA level. You can appreciate that, same as in the first quarter, even the second quarter, we have been able to exceed last year results.

We are on track for the year-end. That there is a bit of seasonality in our results.

You are familiar with Avio, and you know that most of the results are basically achieved during the last, fourth quarter. In terms of net financial position, we have already commented that we have at the end of June €535 million in our bank accounts.

Please, I need to remind you that in the second half, mainly in the third quarter, we will cash in €110 million coming from the Advent capital injection. In the second half of the year, we keep, let's say, incurring CapEx, namely in the US, but not only.

For sure, we will have cash disbursement related to this topic as well to be taken into account. Moving to the last slide, here we can say that based on the first-half results, we are able to confirm the year-end guidance.

Thank you very much for your attention.

Thank you, Giulio. Thank you, Roberto.

I think we can open up the Q&A session.

Thank you. My first question is on the cash-in coming from Advent.

If I understand correctly, and considering that you already covered with the financial resources the need for CapEx, the use for this cash could be maybe the priority additional CapEx for more capacity or maybe M&A, although not shortly, but just to understand how this cash, this additional cash will be used. The second question is on the MBDA orders.

I clearly understand it is not the first time you mentioned that it's difficult to predict when they will come. Number one, could you quantify the soft backlog that you have in mind considering all the contracts that MBDA recently or maybe not so recently signed?

If you can explain us why the process is so long. Maybe this question should be asked MBDA, but just to have an idea.

The third question is on maybe for the long shot. Isar tested the first launch for the Spectrum.

It will take time before becoming a real serial producer of Spectrum and so on, but do you see this could become an issue in terms of price pressure in the future, or the bottleneck is so strong that there won't be any effect? Thank you.

Martino, let me start from this last question since I am in Paris, and I was sitting next to the CEO of Isar yesterday and also next to the European Commissioner Kubilius. Yes, it will take some time for them to ramp up to higher launch frequencies.

Isar has highlighted that they're very happy about the first flight, but one thing is flying once, they said, their words, and one thing is establishing a regular pace of flights. I think great congratulations to them for this achievement, and as we all know, it takes years to ramp up to a regular service.

By the way, they are far from having a performance of the rocket comparable, nearly comparable to that of Vega C. It's a different type of service for small satellites for the time being.

That said, we were together also with the European Commissioner. The European Commissioner explained that in the next multi financial, multi-year financial framework, they have for space and defense a budget that is about six times for space and defense what it used to be in the previous multi-year financial framework.

The ability to do space projects is greatly improved on the public side of the demand, which is a lot of our demand, because as we know, Vega is fueled largely by government customers. Therefore, I think there will be demand for everyone, and still, even if we have more providers, we will struggle to fulfill such demand, because it appears to be way more than we had anticipated.

The same story we keep hearing from the European Space Agency, and you know the last ministerial conference has improved their budget going forward. Therefore, also the European Space Agency satellites will be many more than we had anticipated.

In essence, I think there will be space for everyone. Now, the story of the MBDA orders is simple, is we are a supplier, right?

MBDA makes some announcements. They have signed up for SAMP/T in yet another country.

Every week, they announce something like that. That is a deal they achieve at the level of the system.

Then as for Aster 30, they have us as the sole supplier, there is no doubt that a portion of order will come to us. The problem is that we need to go through the contracting process.

To get from announcements to real contracts takes time, because they need to convert that into an agreement with us on a price, on a volume, certain conditions, timing, planning, et cetera, which takes sometimes weeks, if not months, to agree. I don't have a picture of soft order backlog we can share with you.

We can try to put something together. We have traditionally been pushing back on publishing soft orders.

Otherwise, we would easily get to billions and billions worth of soft orders. Then people will ask, "How soft is that?

How hard?" It's very difficult, quite frankly.

Not that we don't want to share, but we will try to put as much visibility as we can transparently in place for you. All we can signal to you vis-a-vis the outlook we had provided and the guidance we had provided that there is more than we had anticipated for sure, and it's materially materially more.

Now, the cash from Advent will be used for sure to fuel more capacity, in particular to accelerate, possibly, the pace at which we put this capacity in place, and some of it may be for M&A. In fact, we haven't closed with Advent even yet.

We will likely close soon. We have recently received all necessary regulatory clearances for us to close.

As soon as Advent is legitimately part of our team, we will work with them to see, for example, you're right, absolutely, if we can do some M&A, and if this M&A, a private equity fund, it's their job, right? It's what they do is they buy companies, they can definitely help us, in particular, as I always said, to fine-tune our degree of vertical integration in a way that will support faster ramp-up against our production deadlines.

Thank you. No issue for the building of the new US plant in terms of availability of raw mat going ahead and so on.

This is not an issue for you?

No. Far, there is no blocking point from that point of view, but you know that the supply chain is a science in itself.

It's not a single raw material. You need to make sure that all your suppliers deliver on time and on quality, and that's an enormous challenge, I have to tell you.

In fact, for the space part, we want to put in place a special task force together with ESA to make sure that we push the whole supply chain to move at another pace. In certain cases, we will need to think about vertically integrating, doing it ourselves, because maybe we have a better degree of control on the pace of the ramp-up.

It's a tremendous effort, and the same holds true for defense. The defense industry was not ready for such a ramp-up.

Yes, the big primes get lots of orders, but you can only go as fast as the slowest of your suppliers. What we need to do is work in partnership with these suppliers, invest in these suppliers.

If they cannot make it, then we should try to do it ourselves. It's a tremendous undertaking that we are working on, and also maybe some of the cash we gathered from Advent could be deployed against this task of securing supply chain pace and readiness for the years to come.

Thank you. If the cash of Advent is used to accelerate the capacity deployment, could it mean that you could start production before second half '28?

This I don't know, but if the point is that we have to deliver even more capacity than we had anticipated, then we have to seriously think about options to make more capacity available for the future. We also need to increase capacity for space in Europe and in French Guiana.

We will work with ESA on that, but if we have to move more quickly to flight rate 6 for Vega and maybe to flight rate 12 for Ariane, then we need to move very, very quickly. There's lots of investment we need to make.

We need to use the money wisely. We need to have the support of our institutions as well for the assets and so on, but it's definitely what we are trying to do is to accelerate the pace of growth.

Thank you, Giulio.

Hello. Good afternoon.

Thank you for taking my question. I got a few one.

One is you are mentioning that negotiation with US potential customer are going on. I'm wondering if on this kind of negotiation, there is the possibility to initially give some production to the Italian plant, which will have, of course, a faster impact on profitability.

This is my first question. I'm wondering if there were some articles on this, let's say, new space company called The Exploration Company, mentioning a new engine which is based on methane.

It seems to some extent, for my little knowledge, similar to the one you are experimenting. If you can comment on that, if they are similar, or what are your thought about this, also because the valuation of that of those company are, in my opinion, particularly impressive compared to your valuation.

The third one is on, let's say, the possibility of SpaceX going captive from 2029 or something like that. There's some hints in the market, and which will imply a potential demand boost for all the other operators.

Any thoughts on you on that? Finally, if I may, you see a little bit behind on your CapEx deployment.

Shall we reset a little bit the curve, less this year, more next years? Just a quick comment.

Thank you.

Let's start from the first one. Regarding the US customers, yes, this is what we're doing.

We're trying to use capacity in Italy in anticipation of what we will then do in the US. This is obviously very true for the US Army.

The US Army customer is doing 100% in Italy right now. In the future, they've expressed the wish to also leverage the US plant, but for the time being, what we are doing for them is 100% in Italy.

For Raytheon is kind of the same, because we are carrying out the development and qualification of the MK 104 motor in Italy, and then we will transfer production to the US when ready. With Lockheed Martin, we haven't started yet, but I think the objective would pretty much be very similar.

Now, regarding the other questions on space. I am in Paris.

I participated to the international space summit that was held here in Paris over the last two days. It's interesting that you bring the story of space exploration.

I was actually sitting next to the CEO of Space Exploration last night together with the President of the French Republic at the Élysée. We talked a lot about that.

There are lots of interesting developments. In particular, The Space Exploration Company is focusing on a capsule that will be launched with Ariane.

It's a cargo capsule that can go and dock to the space station and reenter atmosphere. That's the core of the business they're working on today.

They also want to develop a very, very, very large engine, which is a very, very, very ambitious undertaking. Of course, they have interest in what we do.

We have interest in what they do. We'll see if there's anything we can do together.

I don't know yet. We already are jammed with so many different development projects that we also have to be a little bit disciplined on how many fronts we want to open, okay?

I do not want proliferation of too many projects, because ramping up at a pace like we're doing, delivering 20% growth every year and yet having a new research project every week, it's impossible. We have to be selective.

We will see, but it's definitely an interesting development. Now, it's interesting your question on the fact that SpaceX may go captive.

I can tell you SpaceX has already gone captive, because we have a whole bunch of customers coming to us and saying, "Oh my God, can you fly us, because SpaceX no longer gives us a chance to launch?" In fact, as you may recall, SpaceX has practiced a lot of price dumping for a number of years by launching satellites at very cheap rates, all together with the so-called Transporter mission.

Guess what? The party is finished, and they don't do that anymore.

They want to do it, maybe they do it at twice the price. Now all these smaller customers are turning back to us and asking to launch.

Thank you very much. Now, we will try to do for them what we can.

We are certainly happy to entertain again discussions with customers that seem to be only looking at SpaceX. Actually, all these customers, I was here at the conference, they went to European institutions and asked if they can have a fund or something, some money, to sweeten a little bit the price for them to launch with European rockets, because they no longer have a SpaceX option.

We'll see how Europe will react. Maybe they will fly with Vega C, maybe with Ariane 6, maybe with Isar, I don't know.

For sure, now we have a whole wave of small customers who no longer have that option available and would like to leverage ours, and we're more than happy to help if we can. In terms of the CapEx deployment, I wouldn't expect much of a change.

We know what our CapEx plan is. We cannot rewrite our business plan every week.

We have a certain deployment plan in the near term for '26 and '27 that I don't think will be changed. If so, we will for sure let you know if and when we have a different plan in mind.

Thank you very much. Very useful.

Yes. Thank you for taking my questions and good afternoon.

On defense, I understand it's very difficult to assess when the Tier 1s in the US will place production contracts. I was wondering if you can give me at least an idea if you have an idea of when this could happen.

I don't know if something that might happen this year, 2026, or we should expect next year. I'm asking this because we saw even yesterday L3Harris getting a $4.7 billion contract from Lockheed, if I'm not wrong.

I was wondering basically if it's a short-term, let's say, by the end of the year aspect, or we should wait for longer. This is the first question.

The second question regards Ariane, the likely increase in the rate of launches. You said it may be 12 per year.

I was wondering what could be, let's say, the timing for this, and if this increase implies for you additional CapEx or you can deal with it with the existing capacity. Finally, on the liquid propulsion demonstrator, I was wondering if you can give us some more color on it in terms of payload, timing, this kind of things.

Thank you for your question. Let's start from the first one, the timing of the orders.

We have difficulties predicting MBDA orders, can imagine how difficult it is to predict the orders from Lockheed Martin and Raytheon. Since this year was a crazy year, they received the jumbo orders that they have never seen before, they signed these deals.

They know they have them, but again, before they flow it down to the supply chain, it takes quite a bit of time. In fact, for this process for us, what is more relevant than the production order is that we do get selected to be qualified for production, right?

Like we did in the case of MK 104 for the Standard Missiles of Raytheon, okay? Once you are qualified as a second source and you have developed the necessary engineering for that, then your orders will be proportional to their orders, you don't have to worry so much about the when.

You have to be sure you are in as a selected supplier. With Raytheon, given that we are in the MK 104 motor, it means that on every Standard Missile-2, 3, or 6, we will have a share.

That is for sure. Now, the when is complex, because they get through, especially in the US, a funding process by the government that depends on the Congress, the appropriation the Congress makes every year on the budget of the following year, et cetera, et cetera.

It's a very lengthy, complex process, but we are not so worried about that, because by the way, we can only start production in two, three years from now after we have completed qualification for production. If I had a production order tomorrow morning, I wouldn't be able to manufacture, because we're not yet qualified to do that.

We have to go through all the technical qualification process. We're working on MK 104 for Raytheon.

We'll soon work on another product for Lockheed, hopefully. We are working on the two products for the US Army, and for those, we have nothing.

Actually, for the US Army, we even have the production orders, we have more orders than we can crunch at the moment, we're not particularly worried about that. Now, on the story of Ariane and Vega capacity.

What we will do as we have always done, because behind this expectation to raise the cadences of Ariane and Vega, as I anticipated before, there is a lot of additional unexpected European government demand. What the European Space Agency will do, will try to support us as in the past with projects to be funded largely by the member states to grow the production capacity of both Ariane and Vega, okay?

The main centerpiece of this is also our common first stage P160. We are working heavily on securing that we get the right funding to grow the production rate of P160.

I'm quite confident we can gain a substantial support for that in the short term. Timing to put that in place probably between two, 2.5 years, something like that.

Obviously, it's relevant in terms of the changes we need to make to the infrastructure, and so on. We already start from a very robust production infrastructure that, if you noticed, has allowed Ariane 6 to grow their pace of growth in the launches faster than any other rocket in the world.

They are now approaching the ninth flight in less than two years. They've been extremely rapid in ramping up production, we will try to follow this path as well and grow even further for the future.

As soon again as we have updates between now and the end of the year on this subject, we will keep you updated on such matter. We are already partly funded both ourselves and Ariane 6 to grow the cadence, if we have to do more, fine, but we already have funds that we can crunch to this end.

Now, regarding IFD, the flight demonstrator, that's an interesting project that has been funded with the EU Next Generation fund. We started sometime in 2022 with the ambition to create a radically new rocket using liquid propulsion, in particular liquid oxygen-methane, and using a completely different type of avionics largely based on software.

Moreover, we wanted to make a rocket whose first stage can possibly reenter atmosphere and land. A very ambitious project.

It's a research project, and therefore, we have decided to test our abilities in flight, and we will do this next year. Now, prior to that, before the end of this year, what we want to do is we want to have this experimental rocket be tested on ground, such that we can collect all the data on the performance of the engine, the performance of the tanks, the performance of all the subsystems without flying, but still a lot of important data points.

Now, what's interesting is that this experimental rocket uses the same core engine that we plan to use in the future for Vega E. All the parts of the puzzles are connecting at the moment.

We will keep you informed between now and the year-end when we plan to test on ground IFD, but it's a very nice undertaking, and we are quite confident on that. For the time being, this is an experimental rocket, it would bring no payload, but, of course, is intended to become a rocket at some point, and we will keep you updated on the evolutions of that.

Okay. Thank you very much.

Thank you. Thank you, everyone, to join the call.