Thank you. Thank you.

I'm Fabio Marasi, Interpump Group Chief Executive Officer. Good afternoon or good morning, depending on your time zone, and welcome to this Interpump first quarter 2026 financial results conference call.

Before starting, I would like to inform you that Elisabetta Cugnasca, former Head of Investor Relations, recently left the company and that starting from June the 1st, the new Head of Investor Relations will be Mr. Federico Pavesi, joining us after a long experience in CNH and Pirelli, to whom I formulate my best wishes for his future within Interpump Group.

As usual, I must draw your attention to the disclaimer slide inserted in the annex part of the presentation that I hope you are able to download from our website. I will start the Q1 2026 presentation, as always, with past and future numbers.

Past numbers: on organic basis, in the first quarter 2026, we had a 2.2% organic growth, positive number for the fourth consecutive quarter, and a -2% EBITDA with a 60 basis point EBITDA margin dilution, mainly explain by the different contribution from the two divisions, with a stronger hydraulics and a weaker waterjetting performance. Future numbers: both the results of the first quarter 2026 and the sales evolution for the month of April are slightly better than our expectation.

Considering the very uncertain geopolitical scenario, we prefer to confirm our 2026 organic sales guidance, that is between -2% and +3%, hoping for more visibility and a better outlook in the future months. In terms of profitability, as usual in May, we are also providing more precise indications, and despite the headwinds coming from a tougher product mix, we are expecting an EBITDA margin for the full year between 22% and 22.5%, confirming once again our most important goal and focus, that is to protect our profitability in every market environment.

I will add more color on our 2026 expectation in the second part of my speech. Now, let's focus with more details on most important first quarter financial KPIs: sales, EBITDA, and cash generation.

On sales, the first quarter 2026 confirm trends that have been ongoing for more than an year. The hydraulic division is recording a sequential and very comforting acceleration in demand, while waterjetting is facing a very tough comparison base with the first part of 2025.

This evolution is absolutely consistent with our expectations summarized in 2026 budget, and once again, it is the clearest possible evidence of the beauty of the diversification that has always characterize Interpump Group's business. Going into details, we feel that hydraulic division touch the bottom at the end of 2024, and that we should now expect a continuation of the sequential improvement that we have seen in the last four quarters, also during the remaining part of this year.

Among the most important categories, agriculture, earthmoving machine, and construction are on fire with a double-digit growth, with others, for example, adaptors, industrial vehicles, after several strong quarters, were less positive. In the waterjetting division, food and beverage, by far the most important market application, and chemical were the most affected by the tougher comparison basis with the same period of last year that we have already mentioned.

Cleaning, the second most important application field, performed very well with a 14% organic growth in the quarter. In terms of geographies, the most important countries where we operate, Europe and US, recorded a very positive performance with a 7% organic growth, while the poor performance in Asia, and in China in particular, was driven by the first part of the mega order that Hammelmann delivered in this area for the in the first quarter 2025.

Complementing the view for the quarter, it's important to underline that very good commercial environment that the very good commercial environment both in terms of projects under discussion in the waterjetting division and the strong ordering take in the quarter with a book-to-bill ratio above 1.5 time. Moving to EBITDA, I would like to come back to what I mentioned in my introduction.

First quarter 2026, we protect profitability despite the important headwind coming from the different business mix, which was characterized by the stronger contribution from the relatively less profitable division, hydraulics, in comparison with the waterjetting one. The good sales evolution in the pure mobile hydraulics application fields, the one that suffered the most in the past, allow to achieve good operating leverage in companies like Walvoil and White Drive, and to improve overall performance in the companies that were hit the most during the past three years downturn, offsetting, in the meantime, the weaker contribution of companies more focused on adaptors of industrial vehicles.

Switching to waterjetting division, sales evolution, excluding the mega order delivered in the first half of last year by Hammelmann in China, is confirming the good long-term trends seen in recent years concerning the higher attention paid by the industrial operators toward the environmental impact of their economic activities. The very interesting ordering take in Q1 2026 and the number of projects under technical discussion in this field are just confirming these trends.

Moving to cash generation now, free cash flow in the first quarter went up by 10% from €29 million to €32 million, continuing the good improvement already reached in the last couple of years. Therefore, it's important to focus on the different components.

Cash flow from operating activities was aligned with the one of last year, while the 45% CapEx decrease from €35 million to €19 million more than compensated the trade working capital increased absorption explained by a stronger top line. Summarizing, another quarter of inventories lower absorption and CapEx reduction is a clear evidence that group is delivering its commitment to improve these KPIs after the extraordinary peak of 2021 and 2023.

We believe, therefore, that first quarter 2026 cash generation result is satisfying and in line with our goal to repeat and possibly exceed the excellent levels of free cash flow generation of 2025. To complete EBITDA overview, it's important to highlight that the group was able to offset the impact of US tariffs, having increased prices or having recharged them to customers.

The newly acquired companies did not have any dilutive effect. To conclude the discussion on profitability, I would like to draw your attention once again to the long-term stability of our EBITDA margin, which, in my view, perfectly exemplifies the strength of our group.

Thanks to our diversification and operational flexibility, we have demonstrated an excellence and resilience in margins in years marked by extreme volatility that few industrial companies can match. Moving now to acquisition, as usual, we would like to provide a short updating on M&A.

No new acquisitions in this quarter, but several interesting ongoing discussions and and negotiation with potential counterparts. We are very satisfied of the integration process of the three companies acquired in the fourth quarter of last years last year, namely Tudor Hydraulics, Borghesani, and FARMA, which are perfect examples of the add-ons opportunities that we are looking for, considering the perfect match between our industrial and commercial strategy, the financial profile of these companies, and respect of our M&A and financial criterias.

Now, the usual overview on most recent market trends and 2026 expectations. April was characterize by a further acceleration of the top-line growth thanks to the less tough comparison basis in waterjetting and the continuation of the positive trends recently seen in hydraulics.

Both the features of the projects under discussion and the very good ordering take for the month, with a book-to-bill ratio once again close to 1.1, make us confident regarding the good evolution to be expected for this second quarter of the year. After this necessary digression, let's go back to 2026 expectations.

First quarter results and April sales evolution are a clear support for our February guidance that we are confirming today despite the severe geopolitical tensions that are characterizing this world and the very low visibility regarding the foreseeable future. On an organic basis, we are expecting a turnover variation between -2% and +3% and a positive perimeter change impact of around 2%, with reported sales in line with 2025 2025, considering the negative FX impact that was around 3% in the first four months of the year.

As usual, with higher visibility given by a quarter of reported data, we are adding the profitability guidance to the sales guidance: an EBITDA margin between 22% and 22.5% despite the headwinds coming from a different contribution from the two divisions, with a stronger hydraulics and a weaker waterjetting, that is, as the most profitable division. In terms of cash generation, as explained before, first quarter results are clear evidence of the group's commitment to proceed in the normalization process of both trade working capital and CapEx.

Therefore, we confirm the goal to consolidate and hopefully improve the cash flow generation achieved in 2025 to a new record-high number. If we are able to deliver these results in February 2027, we will be once again very proud, as they would once again confirm the two fundamental milestones of the group strategy: diversification and business model flexibility.

We are now at your disposal for any question you may have.

Thank you. Ciao, Fabio.

First, three questions, but very quick if I may. First one is hydraulics flat margin in Q1 despite a 6.9% organic, apparently no benefit from the operating leverage.

Can you mention any specific reason in terms of mix, productivity, or other reason for this flat margin in hydraulic? Second is you were mentioning a pretty solid book-to-bill.

I don't know if you were referring because I was not paying attention probably. 1.1 is for both division, and because the question is Q2 will have a particularly challenging comparison in waterjetting.

What is your expectation for Q2 in waterjetting organic, just a range? Last one is on the margin guidance: 22% to 22.5%, Q1 21.9%, a touch below.

We know that typically, not necessarily this year, first half is better than the second half. If Q1 is 21.9%, I would say that 22% to 22.5% is something which require sort of an explanation or maybe more details on how you are going to catch up to this range.

Thanks.

Grazie, Matteo. Regarding the flattish margin in hydraulics, it's important to comment on two different aspects.

The first one, that is the one that I like the most, is the significant improvement in the performance of the company that suffered the most the downturn of the last two to three years, and in particular Walvoil and White Drive. This positive evolution was offset by weaker results and weaker top-line performance of companies working with adaptors of industrial vehicles, and in particular the American company Muncie Power Products, that historically was characterized by a higher profitability and also by the different contribution from the American companies in general due to the depreciation of the US dollar.

Long story short, there is some different performance characteristics also within the two division. As for example, in waterjetting, Hammelmann is way more profitable than the average, and other companies are slightly less profitable than the average.

It's the same in the hydraulics division. Apart this short-term trend in the American companies and in particular in Muncie that is pretty significant in terms of size and contribution, we are satisfied of the better utilization rate of the internal manufacturing capacity in the companies that suffered the most in the downturn.

Regarding the book-to-bill that I wanted to mention, in particular with reference to waterjetting, because clearly waterjetting is down in terms of sales because of the comparison that we were expecting very tough considering the results that we had in the first two quarters of last year. What is important to underline is that we are not seeing any significant slowdown in the market in terms of new projects, in terms of opportunities, and also in terms of ordering take.

In the waterjetting division only, the book-to-bill in the first three, four months was above 1.1. In hydraulics, was above 1, but below 1.1.

In any case, very positive and very significant. It is clearly too early to comment on second quarter, but we will see how it will evolve, but April was good, and the order to be delivered in May and June are good as well.

Clearly, in June last year, we had that mega order from Hammelmann that will be a tough comparison, but in any case, we are very confident of the progresses that we are seeing in the market in terms of demand and ordering take. Last question regarding the guidance on margin, we historically have been criticized for being too conservative, and I believe that we are conservative once again.

I don't believe that we have been optimistic or aggressive in this 22% to 22.5% margin. I believe that considering how we expect that the turnover and also the contribution from the two division will evolve during the year, we believe that a number in this range is something achievable despite the 21.9% of the first quarter 2026.

Grazie. Thanks.

Good afternoon. If a follow-up on the waterjetting division, I'm trying to understand because you are mentioning the 1.1 book-to-bill for waterjetting.

This means that we can expect probably some sequential improvement in place in the second quarter, but far away from the 200 million if I remember well in the second quarter. What I say is first quarter top line has been slightly down also compared to the second half of 2025.

I'm trying to understand why is decelerating if the order intake during the second half was supportive. Then a more general question on the cost inflation: what kind of actions are you taking and when should we expect to see some contribution from these actions and if you are seeing any supply chain disruption?

For this time, you were mentioning the M&A pipeline without waiting for, let's say, a question specifically on that, if you can maybe add some color on what is the potential size of the pipeline.

Okay. Regarding waterjetting, it is correct to say that we are expecting a sequential improvement, but considering the very strong second quarter 2025 and then the tough comparison base, I would say that the sequential improvement can be seen or will be seen from the third and fourth quarter, considering also that the second part of last year was weaker than the first part, and then the visibility is on the second part of this year.

I don't agree technically on your comment regarding the top-line deceleration, because in reality, it's just a lower increase in the first quarter in comparison with the growth rate that we had in the fourth quarter 2025. For two reasons.

The first one is that is another quarter of growth. Second is that is another quarter of growth despite the first part of the mega order in China.

Then the 2.2% is, in my mind, in my way of reading, a very positive number, because we are still... Oh,

sorry. Probably I wasn't clear.

I was referring to the waterjetting alone, the top line of waterjetting alone, not the group level, the deceleration.

One second. I will double-check.

The decrease to -6.something% in the first quarter 2026 is explain entirely by the first part of the order delivered in China last year.

Okay.

The second and more important part was delivered in June. That was made in two tranche.

Regarding cost inflation, it's a very important topics. I don't believe that we saw many effect on the first quarter of the year, but this is becoming a very important topics in this second quarter, in particular after the geopolitical tensions and the Gulf crisis in Iran and the consequent boom in energy cost.

Then we are obliged, like everyone else in the market, to transfer to our customer this price increases through price surcharges or price list increase. This is something that we are doing.

We have already done in some company, but once again, we will do it carefully and without any hesitation, and this is the way in which the entire market is behaving once again. Regarding M&A, I've commented regarding the usual interesting ongoing activity.

We have several dossiers under analysis, mixed in size, mixed in terms of business, and mixed in terms of geographies. I confirm that the environment is still pretty positive because considering the uncertainties that are characterizing more and more the economic environment, more and more operators are at least considering or starting to discuss potential opportunities of this size and merging their activities with a larger, more balanced, more international group.

In this case, Interpump, in some way, is a safe harbor for smaller and more risky companies.

Thank you.

Grazie, Domenico.

Good afternoon to everybody. Hi, Fabio.

The question relates to your comment on the book-to-bill. Actually, I got initially a level like 1.5.

Maybe I was wrong, okay, collecting this data, because then you mention, no, 1.1 for let's say about 1.1. Sorry, just a clarification on this data.

Then the question is, can you comment a little bit about the trend by region, no? You mentioned in the past, no, some uncertainty or volatility in the let's say American market, and now you commented let's say a positive performance.

Just to have, let's say, a picture, let's say, by region, because I recall it that, no, in the past the original performance was volatile quarter over quarter.

Yes. I don't know how this 1.5 in terms of book-to-bill came out.

Maybe is the absolute value of the orders to be delivered that is about 1.1. The order intake in the first three, four months was around 1.1 in comparison with the turnover, more in waterjetting than in hydraulics.

Okay.

In terms of region, I agree with you. This is a very interesting topics, because to be fully transparent and completely honest, the very positive performance of the US market is, in some way, surprising to me as well.

Considering all that happened and considering the depreciation of the US dollar against euro on one side and the application of the tariffs on the other side that made the cost in US much higher than the previous year, I was expecting a softer market demand. Probably, and I'm referring in particular to hydraulics or to some application of the hydraulics market, the deceleration and the destocking activity was so severe in the previous two years that the market is recovering anyhow, despite the geopolitical tensions and the short-term consequences on these cost factors.

Okay. Thanks.

Then sorry, Fabio, your initial comment what was let's say on the guidance, which still let's say assume, no, this negative sign as a let's say lower end of your range. Considering your comment on, no, this sequential improvement you see let's say in April and so on, the reason why let's say you are not upgrading or let's say at least excluding let's say the more negative part of your range is due to I don't know, geopolitical context and therefore you need let's say some more months or quarters in order to reassess let's say the sales outlook?

That's your reasoning? Absolutely.

This is absolutely correct. This is absolutely correct.

Today we are slightly more optimistic than few months ago in terms of top-line evolution and market demand trends. Considering all that is happening every day and considering the huge uncertainty that is characterizing this world, we believe that is too early to remove the lower side of the range.

To be honest, as commented, we are slightly above our expectation for this first several months of the year. Let's discuss on August 5.

Okay. Grazie.

Grazie,

Alessandro.

Good afternoon, and thank you for taking my questions. I've got three.

The first is coming back to your comments on pricing. You said that you put some pricing through in the first quarter, I just wondered if you could quantify that and what you think pricing will be for the full year.

Second question is just on capacity utilization, if you could give us the rates that you saw through Q1 and if that changed through the quarter as well. Then lastly, on waterjetting, obviously, we're sighting against a very big one-off project from last year.

Do you have any visibility as to whether other such projects could be in the pipeline? I realize, by nature, they're one-off, but whether you've been having any discussions, if you're seeing any demand for similar types of projects that could come through, let's say, through FY 2026?

Thank you.

Thank you, Natasha. Regarding pricing, considering the size and the magnitude of the price increase and surcharges that we are applying or we are considering to apply, I believe that at the end of the year, the price effect will be between 1% and 2%, let's say 1.5%.

It is too early to make definitive conclusion, but I believe that we will have more than 1% in terms of top-line contribution. Regarding capacity utilization, considering the very fragmented picture and situation in our group, I believe that is very important to say that the capacity utilization in the companies that suffered the most, I've mentioned Walvoil and White Drive and also some other minor companies, increased in a very significant way in the last two to three quarters, and I believe that focusing on the hydraulics division, being the waterjetting more flexible and more reliant also on outsourcing, I would say that in hydraulics division, today the capacity utilization is something like 95%, with some company that is in better shape and some other that is still suffering a bit, waiting for some further quarter of recovery to join the 100% utilization that, of course, will be very beneficial in terms of profitability.

Regarding waterjetting big projects, I mentioned the positive environment and the positive long-term trends of demand in this world, in this business. What I can confirm is that we have many different projects underway and under discussion.

No one so big and so important such as the one of last year in China, but many projects in the millions, many projects that are relevant. What is important to say is that the long-term trend of higher attention and higher sensitivity of the industrial world operator toward a more sustainable industrial approach is continuing, and we believe it is today and will be beneficial to our technologies and our projects within a long-term perspective.

That's very clear. Thank you.

Yes, good afternoon to everybody. I hope you are hearing me well.

I have three questions. The first one relates to the Section 232 of the United States tariffs duties, the one changed on the 6th of April, if you can give us some color on what kind of impact can have on your business.

The second relates to the trend of the waterjetting division, specifically concerning the Far East and Oceania. I've seen in Q1 a strong drop, I was wondering if last year also in Q1, you had a specific big contracts because, as far as I remember, the Chinese contract was impacting Q2, but I may be wrong.

If you can give us some color also on this. Finally, impacts from the Middle East: did you suffer from some deliveries that could not happen because it was not possible to send certain pumps in the Middle East?

What has been the impacts from this crisis there, given that I imagine some projects in the petrochemical needed also probably some process pumps and so on? Thank you.

Yes. Thank you, Michele.

Regarding the Section 232 of the tariffs, I would like to say that we have had around €6 million impact in the first quarter of the year that has been completely transferred to our customers. There is a huge debate in this day regarding the reimbursement of the tariffs and how this will be managed by the US administration with the companies that paid as importer of goods and the customers that have been paying passing through this amount.

It will be a very important topic, I believe, of the second part of this year, the way in which this reimbursement will be managed and the consequence on everybody P&L. I believe that it will be very clear that we can reimburse or like everybody else can reimburse only the amount of money that will be received back by the US administration.

Today, what we have paid is what we have transferred to the customers. Regarding the Chinese mega order that we have been debating a lot, these orders, this mega project, were delivered in two moments: the first one, the smallest one, was delivered in March last year, and the second in June last year.

Then the impact or the tougher comparison base will characterize the first and the second quarter of this year. Middle East crisis and impact, clearly we had several impact, direct and indirect.

Some projects, some business, some CapEx is being postponed in the region, and this is a direct impact. On an indirect point of view, clearly the effect are tougher and more important, because the delivery time from Asia to Europe has increased, the cost of transportation has increased a lot, and then this is something that we are managing also thanks to our higher-than-normal level of inventories.

It's something that is affecting or has affected the day-by-day management of the business and the protection of the profitability. One of the reason why we are obliged to increase price or to apply energy cost surcharges is also because of this Middle East crisis that is affecting the transportation of goods from Asia to Europe, and vice versa.

Thank you very much.

I have a clarification and then a question. The clarification is just to be sure that I understood properly on the waterjetting trend.

You said one around 1.1 book-to-bill for Q1, and you were mentioning that in April sales were positive in waterjetting. Clearly, we will have the very tough comp in June.

We have to consider for the quarter clearly you have this comparison. Then the question is on your view on the opportunity of the share buyback.

You have started, we have seen already some share buyback programs with a stock down also today, and your mood and your speech quite more constructive, I wonder if you are more willing to use this lever as an opportunity.

Yes. Regarding waterjetting, the book-to-bill to 1.1 also in April, and the positive organic growth in April is very comforting, because is in some way a like-for-like comparison, then is very comforting to us as well.

Clearly we have this June very positive month. We had this June 2025 very positive month.

In any case, without concentrating too much on short-term or monthly results and performance, what really matters is the continuation of the long-term trends of better penetration of our technologies and long-term higher attention to a more sustainable industrial activity world in terms of efficiency, in terms of water consumption, energy consumption, and we are very, very well-positioned with our products, our components, and our systems to have a positive demand and positive evolution of top line coming from these trends. Regarding buyback, you note and you mention what we have already done.

We have bought in the last couple of months 1.3 million shares, investing €45 million, €47 million, and clearly something that considering also the very depressed level of the share price, we are considering to do again in the short term. Clearly, our primary, as commented many time, way of investing our cash flow is acquisition and M&A in order to grow our top line and to grow the size and the meaningful of our group.

We can do clearly both, considering how strong is our balance sheet and how strong is and will be our cash flow in 2026.

Thank you.

Yes, thank you. Sorry, we could not end the call without a question about M&A.

Can you give us some more color or is it something steady-state compared to the last messages you gave, just to have an update? Thank you.

I would say that steady-state is a good way of describing. We are very focus.

We understand the opportunity, because in uncertain time, strong companies and strong groups such as Interpump may find very good and interesting opportunity at the right prices. Then we are positive on the outlook for the remaining part of the year, but also with a midterm perspective.

Thank you.

Hi, Fabio. Fraser here from Berenberg.

Thanks for the presentation. Sorry to ask a question which has been asked in different ways already, but I wrote down that you said the book-to-bill in waterjetting in Q1 was 1.5 times.

If it was €160 million revenue, that would imply orders around €240 million. Did I just miss hear that?

Probably I said 1.15.

Okay. Thank you.

That was my question. Appreciate it.

Okay. Thank you, Fraser.

Thank you. Thank you everybody for participating today.

We will update, and we will meet again on August the 5th for the second quarter and first half results. Thank you so much.