Ladies and gentlemen, welcome to the Q2 figures 2026 Conference Call. I'm Moritz, the Chorus Call operator.

[Operator Instructions] The conference is being recorded. [Operator Instructions] The conference must not be recorded for publication or broadcast.

At this time, it's my pleasure to hand over to Anja Siehler. Please go ahead.

Thanks, Moritz. A warm welcome.

Thank you for joining the Q2 2026 results management call. As always, we ask you to take notice of our safe harbor statement.

With me are our CEO, José Luis Blanco; and our CFO, Ilya Hartmann, who will lead you through the presentation. Afterwards, we will open the floor for your questions.

And now I would like to hand over to you, Jose Luis.

Thank you very much for the introduction, Anja. And on behalf of the Management Board, I would like to welcome you to our second quarter results of 2026.

Let me start with a brief overview of the key highlights of the quarter. Overall, I'm pleased to report that the second quarter of '26 reflects continued positive momentum for Nordex.

We delivered revenue growth, achieved a double-digit EBITDA margin, generated healthy free cash flow and maintained a strong financial position. First, order intake reached 3.1 gigawatts, representing growth of 32% year-on-year.

Europe continued to be our largest region, accounting for 74% of the project order intake, while Germany and the United States were the most important individual markets during the quarter. Second, we continue to deliver strong revenue growth.

Total revenues increased by 16% year-on-year to EUR 2.2 billion. Project revenues accounted to around 90% of total revenue and grew by 18%, reflecting continued progress in project execution.

At the same time, our service business continued its positive development, while revenues increased by 8% year-on-year and EBIT margin going to 19.7%. Third, profitability improved further.

We achieved an EBITDA margin of 10.3%, exceeding the 10% threshold and improving by 450 basis points compared to last year. Finally, cash generation remained strong.

We generated free cash flow of EUR 165 million, while working capital remained stable at minus 8.3%. In addition, we strengthened our financial flexibility by securing EUR 2.5 billion of bank guarantee facilities on improved commercial terms.

At the end of the quarter, our net cash position stood at EUR 1.7 billion, underlining the strength of our balance sheet. Overall, the second quarter demonstrates the continued progress we are making across the business.

We remain focused on disciplined execution, profitable growth and delivering on our guidance for the full year 2026. Moving on, turning to our activities in North America, particularly in U.S.

on Page 5. I'm happy to report that we have successfully reestablished our presence in the market.

Year-to-date, we have secured around 800 megawatts of orders until the end of June, supported by a diversified customer mix, and we keep on working on increasing the pipeline. At the same time, the ramp-up of our Iowa facility is progressing well.

Production is underway. The facility is ready to scale with demand and no further CapEx will be required.

Combined with our established service footprint and growing regional organization, we believe we are well-positioned to capture future opportunities in the U.S. and Canada.

And let me turn now to our operational performance, starting with development of our order intake. As published in our order intake press release on July 9, we saw a strong uptick in orders driven by major regions.

During the second quarter, we recorded 3.1 gigawatts of order intake, an increase of 32% year-on-year. The growth was supported by major U.S.

orders entering the book. Consequently, order intake for the first 6 months of the year reached close to 5 gigawatts.

In Europe, turbine order intake totaled almost EUR 3 billion. Orders were received from 10 different countries and the average selling price of EUR 0.97 million per megawatt was stable when compared with the second quarter of previous year.

Although average selling prices are influenced by the specific project and regional mix in any given quarter, we continue to see stable pricing across our markets. From a regional perspective, Europe remained the main region and accounted for 74% of the order intake.

While -- and as usual, we are not providing specific guidance for order intake for 2026, we continue to expect a good order momentum for this year. And with this, let's move to Slide 8, where I will discuss the development of the order book.

The combined order book strengthened further and exceeds EUR 18 billion at the end of the second quarter of 2026, reflecting continued positive momentum of both our turbine and service business. Turbine order book reached EUR 11.6 billion, and most of the orders came from Europe, followed by North America, Rest of the World and Latin America.

In the Service segment, the order book increased to EUR 6.8 billion. By the end of the quarter, the service portfolio crossed an important milestone.

For the first time, we have over 50 gigawatts under service, representing more than 14,000 wind turbines. Overall, the order book developed towards planning visibility and reflects the expansion of our installed base over the past years.

Let us move to Slide #9 and have a closer look into the service business. The second quarter of '26 continued to show solid progress in the service business.

Service sales increased by 8% and reached EUR 223 million, representing 10% of total group revenues. EBIT margin further improved to 19.7%, progressing towards our midterm EBIT margin target of crossing the 20%.

Operationally, fleet availability remained stable at around 97% and the average tenure of service contracts increased to over 14 years. Let me move to the next slide.

Giving you some insights into our installation and productions in Page #10, installations developed according to plan and totaled 1.2 gigawatts. The reduction year-on-year was primarily driven by project scheduling with a large share of installations weighted towards second half of the year.

There were also some regional mix effects on customer delays and as previously communicated, blade-related postponements in Turkiye. While installations in Germany increased year-on-year, this was not sufficient to fully offset the regional mix effects.

The key takeaway is that these are primarily timing-related factors. We continue to expect full year installation to grow compared to 2025.

On the production side, turbine output increased to 337 units, reflecting project scheduling and delivery requirements. Blade production remained stable at around 1,343 blades.

And now I would like to hand over to Ilya to talk about the financials.

Thank you, Jose Luis, and welcome from my side. As always, I will start with our income statement.

Some of that has been highlighted by Jose Luis already. In the second quarter of '26, sales increased 16% to almost EUR 2.2 billion, reflecting high activity levels in both project and service business.

Gross margin continued its positive year-on-year development, improving to 26.9% from 24.8% in the second quarter of 2025. As a result, EBITDA more than doubled and reached EUR 224 million with an EBITDA margin of 10.3% for the quarter.

On the back of this operating performance, we reported a net profit of EUR 111 million for the quarter, representing a substantial improvement of EUR 80 million when compared to last year's quarter. And with that, we're moving on to the balance sheet.

Well, in analyzing the balance sheet, the overall structure remains on a very comparable level when looking at year-end '25. The second quarter ended with a strong cash level again of approximately EUR 2 billion, and the equity ratio continues to improve and reached 20.6% at the end of the second quarter, backed by a further increase in net profit and equity outpacing the increase in the total assets.

And that moves us to the next slide, which are the other balance sheet KPIs and their development. So net cash increased further and totaled EUR 1.7 billion at the end of the quarter, and that is again supported by the operational performance that Jose Luis explained earlier.

Working capital stood at minus EUR 663 million and remained at a stable ratio of minus 8.3% quarter-on-quarter. Let me now go to the next page and spend a moment on the financing highlight, which is not our regular set of slides, but what we believe in order to comment on, and that is the closing of a so-called multi-guarantee facility that we signed in July, so only a few days ago, about EUR 2.5 billion, and it has not only been a significant development for the company, but particularly in 2, 3 aspects that we want to discuss.

It is a much larger facility than the previous one, almost doubling the volume of the previous MGF, which is the acronym of EUR 1.3 billion. It has a longer term, almost twice as long than the previous one that was 3 years.

Now the new one is 5 years. The interest rates or the cost of those bonds are materially lower than in the previous facility.

And without getting into details, but the other terms in those -- in that MGF is far better than in the last one and arguably close to an investment grade company facility. It is backed by 15 banks, so less than last time with larger tickets.

Obviously, the volume is higher and the banks are a reduced number. So that is a substantial progress, which Nordex has made in the recent years, especially in strengthening the balance sheet and the overall financial profile of the company or in other words, it is a token of trust.

Back to the usual flow, and that is now the cash flow on the next page. Again, on the back of the operational performance, the cash flow from operating activities before net working capital increased to EUR 267 million.

With working capital normalizing, the cash flow from operating activities was EUR 240 million. And as a result, we generated a positive free cash flow of EUR 165 million in the second quarter of 2026.

For the full year, we continue to expect a solid free cash flow generation. CapEx spendings amounted to EUR 46 million in the second quarter.

That is 19% above the last year, mainly due to the ramp-up of the new blade facility in Turkiye, which we spoke about a few times in the past calls. Then our investment focus remains largely unchanged compared to last year and the years before with investments primarily in blade and nacelle production facilities and tooling for installations and transport reflecting the higher volume.

And with that, I would like to hand it back to Jose Luis for the next slides.

Thank you very much, Ilya. So before turning to our guidance, let me make a few brief comments on the market outlook.

Overall, the medium- and long-term fundamentals for onshore wind remain attractive. Across our core markets, we continue to see supportive policy frameworks, strong auction activity and growing demand for secure and cost competitive renewable energy.

One notable development since our full year results is the publication of the draft EEG and grid package in Germany. While both proposals are still subject to the legislative process and might change, our initial assessment is cautiously positive.

The proposal points to higher auction volumes and provide greater clarity around grid-related topics, which could help reduce uncertainty for developers and investors. Beyond Germany, we continue to see encouraging developments in the U.S., Turkiye, France, Canada and several other markets, supporting a healthy long-term outlook for the industry.

And with this and based on our performance year-to-date, I can confirm that we remain on track to reach the guidance we set out in February. We continue to expect 2026 to be a profitable year, assuming no material disruption resulting from geopolitical developments.

To reiterate, we expect a top line growth between 9% to 11% year-on-year with an EBITDA margin in the range of 8% to 11% with midpoint plus as the most likely outcome as of today and expect another good year for free cash flow generation. And now I'm going to the Page #20, where we talk about the midterm targets.

As you can see on the slide, the first half of '26 provides further evidence that we are moving in the right direction. Our EBITDA margin improved to 9.4%, reflecting continued progress across the business.

The main building blocks remain unchanged, growing volumes, stronger contribution from our service business and the ongoing efficiency measures that we are implemented throughout the company. While there is still work to do, the results achieved so far give us confidence that we are on track towards our midterm EBITDA margin target of 10% to 12% and that we are building a more profitable and resilient Nordex.

And with this, handing over to Anja to open the Q&A.

Thanks, gentlemen, for leading us through the presentation. I would now like to open the Q&A.

[Operator Instructions] And the first question comes from Richard Dawson from Berenberg.

Two from me. First one on the U.S.

orders. So now that we've seen a restart in those U.S.

orders, are you able to provide any color on any margin difference between those U.S. orders and the German orders?

I'm thinking more broadly about any potential inefficiencies you have in the Iowa facility just as you're starting to ramp up, but also any cost differences on those U.S. turbine variants compared to the European ones?

And then secondly, Ilya, maybe one for you and a bit more detailed on the balance sheet. If I look at production levels versus installations for the first half, you're running about 1 gigawatt ahead on production versus installations, but your inventory figure is broadly flat for the period.

So just wondering why there hasn't been a corresponding increase in your inventory on the balance sheet given that outrun in production? Or is that not the right way to look at it?

Thank you for the question, Richard. So the first is quite simple.

I think without going into details, ballpark similar profitability as Germany.

And then I go to the question on the revenue recognition and on the inventory part. So yes, fair question.

So maybe use the opportunity to say revenue recognition. That's not your question.

It's done, again, mostly cost to cost when we produce our components, so not so much on the installations. That is why we see that revenue number to that order of magnitude.

Why not the inventory? Because that production that outpaces also the installations is done mostly really by and large under existing contracts, and we're getting paid by our customers.

This is why you don't see that as an increase in the inventory.

And the next question comes from Vivek Midha from Citi.

So my first question is a follow-up on Germany. You've talked about the stable turbine prices despite the weaker auction prices we've seen for the power in those auctions.

Is there any reason to think that the future normalization of turbine pricing in Germany could exceed any of the assumptions you made underpinning the midterm normalized margin target you gave us? And do you expect auction pricing to stabilize given the further improvement in volumes in 2027 to '28?

Well, German pricing so far we see stability in the pricing. Future pricing is hard to predict.

What we can comment is what we see today and what we see today is stability. Regarding future auctions, it's going to be a new system and it's a little bit crystal ball reading.

But all things being equal, if there is no market upside, prices should recover in the auctions. But again, this is crystal ball reading.

I mean, for me, the positive aspect is that it's going to be substantial volume, which is in line with what the German government needs, needs more electricity to help to reduce the price for citizens and industries. And this is a good opportunity for having a healthy margin for the market participants.

That's our assumption.

Understood. My second question is just as a follow-up on the notes.

It looks like you've had some impairment of trade receivables over the last year and including in the first half has gone up from EUR 55 million to EUR 92 million. So could you just comment as to why that may be the case?

And if there's been any P&L impact from that?

Thanks for that question. But there is basically nothing out of the ordinary.

That's not because of any customers kind of faltering or et cetera. It's just some sanitizing of books, but nothing where a customer basically is not able to meet its obligations, his or her obligations.

And the next question comes from John Kim from Deutsche Bank.

Two from my side, if I may. If we think about the Q2 print, you had quite a bit of production contribution to the revenue, not so much on the deliveries.

Are you expecting this to normalize in the second half of the year? Or is the cadence of this year off versus "normal" given the Turkey situation and perhaps German permitting connection delays?

I think we'll catch up in the second half, at least that is what our planning says. And going forward with more geographies and more diversification and recovering the delays in Turkiye, we will go to a more normalized levels in the future.

But definitely, in the second half, we'll catch up.

And if we think about the things that need to be true to deliver very strong deliveries in H2, where are you on your factory loads? And how should we think about that in terms of cost to fulfill or OpEx?

I would say from that aspect, the year is not that different than the previous year, very much in the second half to do 60% to 65% of the activity of the year, and we are well prepared. So I will say it's not new ramp-ups that we need to do.

It is very much repeating the year that we did last year from the production side.

Then the next question comes from Constantin Hesse from Jefferies.

A couple of questions from my side. The first one, I'd like to focus a little bit on Germany because clearly, this EEG announcement is absolutely massive, assuming that the grid package is balanced enough between government and developers.

So I just want to understand what have your conversations with developers been with regards to this grid package? I've heard a lot of pushback with regards to the latest draft.

I heard the government just achieved an agreement a couple of hours ago. I haven't seen any new draft yet.

But I'm just curious to see what the announcement was because if this grid package is balanced and the developers are happy with it, I mean, I'm looking at this forecast that you have on Page 18, it's very conservative what Germany could actually go to, right? I think this forecast has Germany declining installations wise again in 2030.

And if this goes through, we could see growth into the early 2030s with further order intake growth, i.e., Nordex could even be installing low teens gigawatt numbers in a couple of years to 3 years' time. So I'm wondering what have your discussions been?

And what's your opinion on this current grid package, please?

Well, thank you very much, Constantin, for the question. I think our view on to the association and to the government is you need to build a ton of renewables, you need to build a lot of grid in order to reduce the dependency and reduce the price for consumers and the industry.

That's the equation. So then you can take different approaches, but delaying the deployment of wind onshore because the grid is slightly delayed, is not very advisable.

I mean -- and second, if you are outpacing a little bit the deployment of wind onshore versus the deployment of grid, this is a temporary thing because at the end, both investment needs to be done in both sectors, and it's going to be materially impossible to do synchronize the pace of those investments. So assuming that's the way forward, then you could question if there is certain curtailments, who should pay for that.

And in our humble opinion, from a country point of view, the more you derisk the investment decisions for investors, the better for consumers. If you ask every investor to put a risk premium into what the curtailment is going to cost, at the end, it's going to be a higher price in the auction and a higher price for consumers.

So we cannot comment much on the draft because it's just from the oven, but at least there is a cap, and it's better to have a cap than having uncapped figures to price that risk because if the cap is 20%, it's a different thing, pricing 100% of the risk or 20% of the risk. So we wish to see a lower number there.

So as our customers as well, but at least there is a number, Ilya, I don't know.

But Jose Luis, I don't think -- I mean, I would be under the danger of repeating what you said. So I think Constantin mentioned this question, the government has announced informally in the past months that it wants to have an additional 12 gigawatts on top of already, we probably agree very high German volume connected to be in 2030 or before, and it has now put that into the draft.

So not knowing what finally the government decided on that one, but I guess they would approve this, meaning that we have auctions in '27 of 15 gigawatts and '28 of 15 gigawatts and in '29 of at least 12 gigawatts. So that is the acceleration that Jose Luis was mentioning.

And when it comes to curtailments and who pays what, let's wait what the final outcome is, but I have 2 points. One, Jose Luis has made, which is the certainty that the government appears to acknowledge that there needs to be a certain number.

And that goes especially, I guess, to the financing sector to make projects banking. And the other comment I would have, not knowing what happens in the future, but the auctions have worked from a system perspective.

They have done price discovery. Maybe it's not even final.

So there is a price discovery and that is what the system wanted and it's based on a certain set of rules. So now if you change those rules, your price discovery will continue, but it might lead to a different pricing point or what Jose Luis was indicating, auction bids might go up again.

If the system wants to pay the cost that way, that's a political choice. What we're saying is you will ultimately at least have -- bear in mind that auctions can go both ways.

And from that perspective, I would say, from an OEM perspective, we're fine with it. From a system perspective, politicians need to make their decisions.

Understood. Second question, if I may, just quickly.

Obviously, the second half is going to be pretty significant in terms of activity. So just understanding your exposure here, the markets that you're in, fair to say that you're all set up in terms of the local infrastructure, cranes, everything.

Is there any exposure that could add to this execution risk? Or from today's perspective, you're really well placed from local infrastructure requirements to get everything built in time?

I would say we are properly staffed. If I can point a risk is maybe transportation permits in Germany due to the high activity in the market.

Other than that, we are well set. And even in Germany, I think we are discussing with the different government agencies and so on to overcome as an industry this potential bottleneck.

And the next question comes from Sebastian Growe from BNP Paribas.

The first one would be around services. The order momentum has been stronger than what I would have expected with the ratio compared to the project segment orders running at a very high level compared to historical standards.

So what is the root cause for the strong service order intake? And can you talk us through the terms of the contract renewals in particular and how these might fit then also to your target to cross the 20% margin level in the not-too-distant future?

And secondly, on the U.S., you had pointed to the 800-megawatt plus of orders in the backlog. Can you give us an indication with regard to the size of your remaining pipeline?

And while you have been pointing to market share mostly on prior calls in the U.S., what absolute volume are you targeting in that market? And if I may very briefly chip in one more as a clarification to an earlier question that was asked that was more around pricing.

I think we know that normally there's a delta on pricing, which might be better typically in the U.S., but you probably then kind of have to pay for it at the expense of less favorable working capital terms. So if you could just walk us through also the working capital on the side of the U.S.

business in particular.

Thank you, Sebastian. So services, I would say the main rationality behind that is the higher volume from Germany, where most of the contracts have long-term duration.

And the way we count the backlog is very much the expected revenue for those service contracts. So is the service contracts that we landed in the last quarter, the average tenure is higher than the cumulative one, and that's why that is increasing.

That's the reason. Regarding U.S., we need to be cautious here because we have a certain healthy pipeline to achieve and if not even exceed what we think could be volumes that we did in the past, but I don't feel confident to guide you on order intake in general unless even to do specific into a market.

But we are investing there because we are optimistic about the market, and we are optimistic that we have products and teams and solutions to harvest a decent market share in that market. Our ambition before that was previously communicated was why not 20% and we stick to that.

So why not 20% or even more maybe. And regarding pricing, working capital and conditions of the U.S.

deals, without going into too much detail, but those are not that different than the ones in Germany. So that are good quality deals.

Yes, sounds great.

They are.

For the 20% that you just mentioned, I also asked around the 20% margin for service. So this is kind of a new flight level in a way, right?

So is there anything that you would like to include?

Sorry, I didn't -- I mean the service business is -- profitability improvement is a slow moving piece because you do slightly marginal improvements and you do 10% growth year-on-year, and this is what drives profitability improvement. So we are reasonably convinced that we will hit that 20%, but it's a slow-moving journey.

Then the next question comes from Alex Jones from Bank of America.

Great. Just following up on that U.S.

order pipeline comment. Could you talk about the extent to which the 4th of July, tax credit deadline was an important driver for the orders to come through in Q2 specifically sort of per your discussions with customers and whether there are any other catalysts, tariff discussions or otherwise that would catalyze more orders coming through from that healthy pipeline that you highlighted?

And then the second question, just on the installation sort of back-end loaded nature of this year. You highlighted customer delays being temporary as one factor driving that.

Could you talk about the confidence in the sort of temporary nature of those and whether you've started to see those delays ease in July already?

So regarding U.S. I don't think there is any specific milestone that triggered those orders.

The pipeline one way or the other, some of them is relying on certain federal permits or others don't. I think what we see now is that a substantial volume was safe harbor under current legislation, and we plan to take a share of that safe harbor volume, some with the reservation agreements, others don't.

But we are optimistic given the momentum that we see in the market that we will get our share into that market. And the volume that was safe harbor, I mean, nobody knows precisely.

but there are different reports out there pointing into sustainable volume. And that's as far as we can go.

I think regarding installations, if you look at it year-on-year, certain geographies didn't contribute like Nordics or Spain, a little less installations in North America, although this is expected to dramatically change 1 year from now and the delay in Turkiye due to availability of blades. That was partially compensated by more installations in Germany year-on-year, but not sufficiently.

And it's true that even with those increased installations, we were expecting to do more, but customers were not ready with the sites. And as a proof of fact, we are not booking liquidated damages for late delivering.

It means that we are ready to deliver, but either sites are not ready or projects are not ready. We expect this situation to change in the second half.

And our assumptions is that we are going to be ready when the projects are ready.

Okay. And just a follow-up on that U.S.

point. Do you have an expectation for when Section 232 tariffs might become clear and I know some people expect that in the next week.

Is that in line with your views?

I think we have no specific state on that. So no.

And I think that's the larger question that you have. I can only say it is -- when you see those orders apparently or obviously not hindering too many customers from moving ahead.

So it's a very important determination, but customers have just decided to go ahead.

And the next question comes from Vlad Sergievskii from Barclays.

My first one is on margin, very strong double-digit margin this quarter. Interesting that it seemed to have some mechanical headwinds such as elevated provision in this quarter or a receivable write-down as well.

Would it be fair to assume then that those headwinds masked your true margin potential this quarter, which otherwise would have been substantially higher. Assuming normalization of provisioning, for example, your EBITDA margin could have been in teens or mid-teens?

That's the first question.

Then I take the first one, and then you, whatever comes next. Thanks for the question.

It's a good one. Maybe 2 lines of response.

On to the provision themselves and then to the assumption, which I think we need to Jose Luis for as well when it comes to the total margin. So the provisions have been a bit above, and well, slightly, I would argue, above what we kind of calibrate you for as up to 4%.

That is nothing out of the ordinary. It's more mechanical because we've been selling a lot of stuff in the past quarters, as we know.

And then the revenues for this H1 are just not a 50% reflection of full year. So the percentage of, I think, [ 4.6%, 4.7% ] of additions is a bit above that.

That we clearly think will normalize around that 4% number for the full year. So there's nothing out of the ordinary in those provisions.

When it comes to what you're pointing to what margins could be, I think the larger role and then maybe I'm already anticipating too much is that it will depend on how the execution in the second year goes. So more back to our contingency conversation of last year.

There is a risk profile of execution in the second half of the year, which has given its volume, a lot of potential, but also certain risks. So I don't think that from the provision, we can read too much into any thing called as underlying margin.

Very good. If I can quickly follow up on this provisioning point.

You also suggested that there was some revisions to cost estimates, which drove those provisions up. Were those revisions related to Nordic-specific matters, certain specific projects or regions or those cost revisions are driven by more general inflation across the board that you are seeing?

No. It is very -- meaning the order of magnitude there is not that substantial.

It's here and there some adjustments, updates. Yes, we do see some inflation in certain components, but nothing, which gives the order of magnitude.

I would say, if I -- I mean, every quarter, you have more visibility about the year. So we started the year with the Iran war and a lot of spikes in certain commodities.

And it's true that we have suffered cost increases in certain commodities. But every year, there are risks and chances.

And the way we look forward and the way we see the year, we think that the chances can compensate the risk. And this is the reason why we are guiding to midpoint plus.

So because we -- despite the cost increases, I think we managed to deal with those with other productivity and efficiency measures.

Great. Final quick one from me.

There will be IFRS 18 accounting change from 2027, which, among other things, will require some project-related financing costs to be reclassified into operating profit line. Have you already done any preliminary assessment of potential impact of this accounting change on Nordex?

And if you've done that, what would be the preliminary conclusions, please?

Thank you. That's a very good question.

It's going to be with us next year. So it's going to be -- we're going to have an interesting and detailed conversation when we're going into next year.

Yes, but still early to assess. Of course, most of it will influence then the EBIT line.

Look, let's have that conversation once we get there, but I dare to say that the effect is not -- I mean, what does that mean, but you have to probably trust me, it's not that substantial. So given what those costs are, I mean, they're there, but also they're going down as we have talked in the presentation.

So the order of magnitude of that is not that significant. But we will have that as a detailed technical conversation beginning of next year.

And the next question comes from Ajay Patel from Goldman Sachs.

I guess looking at the margin for this quarter at 10% and then thinking about the second half of the year where you have a higher revenue. And I'm just trying to wonder what -- how did you perform versus the contingencies you put in Q2?

And what contingencies do you have for the second half of the year? Because with assuming some operational leverage, it would seem that you would, why aren't we thinking about a situation where we're talking midpoint plus, plus, for example.

So just trying to understand the underlying assumptions? Or is it just a case of there's a lot to execute on and you would want to get through it before you were more visible?

I think you name it. Last part of your question is our view.

Let's give -- let's take a little bit more comfort into how high level of execution going. Still the world has a lot of geopolitical issues, not fully settled, and we just need more comfort.

Okay. And then if I just take a second question, just more on capital allocation, right?

Sizable amount of cash sitting on the balance sheet. I know that you're committed to returning or increased returns to shareholders maybe going into next year.

What do you think about that cash position? It's building quite nicely as we go through the years.

What other allocations are you thinking? Is there any update that you can give us on this side?

Thanks for the question. That is always a very valid question, especially when a company has a cycle like ours.

I think the short answer is, I don't know if you like it or not, there is no update. We'll come with that when we get in front of you with our full year results when the final tally is in, we've seen all the things that Jose Luis mentioned that still need to evolve.

So to deal with that question hypothetically is too early, and I would say, undue. So we will update this once the full year results are in, and we're doing the call.

And until then, our position of the order of magnitude that we gave with the full year call and whether that's going to be buyback or dividends is just the same.

And the next question comes from Sean McLoughlin from HSBC.

Just looking at the order intake, another strong quarter, you're trending ahead in H1 of what was a historically high demand year last year. Maybe just to gauge your degree of confidence on that demand strength through the second half?

And any markets you'd want to highlight where you see incrementally positive or negative demand potential in the second half?

No. Thank you very much for the question, Sean.

No, I think we are very much going with the market other than U.S. that we are so pleased to announce our entry into the market.

For the second half, is business as usual and going with the market. So with the market share we have in the markets we operate, that should be a good proxy.

And would you be comfortable with the total volume of order intake at least at last year's level?

We don't guide order intake, but we expect to be another good year.

Then the next question comes from William Mackie from Kepler Cheuvreux.

My first question would be about the U.S. again.

Great success in making your presence in the U.S. market clear.

And I hear your comments about further opportunity to build on the 800-megawatt backlog. But I wanted to ask about cost recovery.

Your plants in Iowa are staffed and building, but there's presumably no throughput there yet. So can you share what level of throughput is needed in the U.S.

to get to a sort of at least a breakeven level rather than a cost level for the group as a whole? And then perhaps some thoughts about what your initial plans are on the ramp-up volumes and throughput in the U.S.

over the next 12 to 18 months?

The plants have been operating for 1 year at a low activity level to meet the project demand. When we mentioned before similar margins than in Germany, it's including the cost associated to have the local activities in U.S.

for U.S. So if you sell, I don't know, 200 -- even 100 units a year, you recover your cost.

So that's not the killer of the business. I think the cost is quite reasonable to do the local activities in the U.S.

and we are planning to double the output in the months ahead, and to go to nominal capacity beginning of next year.

Super. Okay.

With regard -- my second question then would reflect back on the questions about capacity, your group's capacity when you want to think or frame it at the moment. Clearly, there's opportunity or optionality to the upside in terms of volume and the wins that you could have in share and in absolute market volume.

But on the supply side in your own organization, I think you've talked up to about 11 gigawatts of throughput or installation volume. Theoretically, how do you see the setup today in terms of the capacity without significant CapEx?

And where would the constraints be? Would it be primarily blades?

Or do you see other elements of the supply chain that could constrain your ability to grow over a 3- or 4-year period?

I think we run the company with substantial overcapacity in nacelle assembly because geopolitics and Net Zero Industry Act and you need to assess the situation before putting all eggs into the same basket as well geopolitical situation, China, U.S. So you need to have optionality and optionality cost you money, but derisk your delivery.

So from a nacelle perspective, we have substantial overcapacity in place as well, although I will say slightly less in place than in nacelle. So blades will be the less overcapacity, although we have overcapacity as well in blades.

And the next question comes from Klaus Ringel from ODDO BHF.

It would be on the MGF facility that you highlighted in the presentation. Question here is if you could quantify an impact on your financial results looking ahead from that.

Yes. Thanks, Klaus.

Very fair question. That's one we didn't directly address in the presentation.

So maybe 2 remarks. The second one is, I guess, geared to your question directly.

First remark is, as I said in the presentation, now in any like-for-like scenario, that new MGF now reduces the financial cost, the interest cost per bond unit, so to speak, substantially as much as in the final stage, 60%, 65% from its peak range under the old MGF, so a substantial reduction. And of course, that depends also on the volume you utilize.

So in order to maybe calibrate what you would want to model. So basically, what we would for '26 and then '27 will be a moving target because let's see what the volume does.

And of course, we're also generating more interest revenue, the more cash we have. But for this year, if you stick with and plug in a total number of 60 plus, EUR 60 million to EUR 70 million of total interest costs, then you're on the safe side, rather probably 60 minus.

Maybe that's the best calibration I have for you today.

[Operator Instructions] And we do have a follow-up question from John Kim from Deutsche Bank.

I'm wondering if we think about service revenue growth, you've had very strong order intake. You've had a very strong base effect.

When will we see kind of substantial acceleration in the revenue line for the division? And then a follow-up, please.

Yes. But we need to differentiate 2 things.

One is the order intake, which is x number of megawatts multiplied by x number of years, but the contribution per year is related with the number of megawatts, not with the number of years. The number of years give you the backlog, not the growth on the order intake.

So from that point of view, I think we will see in the 10s -- 10% revenue growth year-on-year despite the order backlog grows way faster because you increase your tenor of the contracts.

Okay, got it.

I don't know if I explained that -- you have 50 gigawatts under service and then to contract 8 gigawatts, and then we are going to have 58 the year after. And another 8 gigawatts, 64.

And that's the range of growth that you should expect from this business. Despite these 8 gigawatts might have 20 years of life.

But it's revenue over 20 years, not growth in the year #1.

I get that. One follow-up question unrelated.

I think you had spoken to the platform development earlier. If you think beyond kind of this year or the existing backlog, when should we think about a new platform?

And I think you've spoken before that you would look at competition, but not necessarily lead the charge here. I'm just wondering if you could comment on that dynamic as well, whether you see other OEMs.

We stick with the same strategy, prepare the ingredients in order to cook the meal if needed, but we are not going to start cooking the meal if it's not needed. It means that we will -- in this case, will be followers.

And we do have one more follow-up question from Vlad Sergievskiy from Barclays.

Last question from me is on costs. You reported cost of raw materials and other supplies down about 1% in the first half of '26.

That's at least what your disclosure suggests. At the same time, your revenue was up 14%, which suggests the physical volume of work recognized in the P&L is probably up double digits, which means average raw material cost allocated to turbine should have been down 10% or potentially more than that.

This is, of course, some impressive cost cutting and cost efficiencies given that we are seeing more inflationary backdrop right now. Can you give us some idea how the cost cuts have been achieved?

I don't think you can draw conclusions from that point of view because the way we do accounting and the way we report is not based on cost of goods sold. So as a consequence, it depends a lot of your in-house activities.

If you produce or you procure, you have more or less personnel costs, more or less supplies. So -- and the cost base is going down in certain part numbers.

It's going up in other part numbers in services is going up. But I cannot -- unfortunately, I cannot give you a precise answer to your question.

Ladies and gentlemen, this was the last question. I would now like to turn the conference back over to Jose Luis Blanco for any closing remarks.

Thank you very much all. And let me close with a few key takeaways from the second quarter.

First, we continue to deliver on profitability with further margin improvement and solid order intake, including important successes in the U.S. This gives us confidence in our trajectory for the remainder of the year and provides good visibility for the coming quarters.

Second, we further strengthened our financial position. We remain focused on generating positive free cash flow while the signing of the new EUR 2.5 billion warranty facility increases our financial flexibility and provides additional capacity to support further growth.

And third, based on our performance in the first half of the year and the visibility we have today, we are confirming our guidance for 2026. Overall, our results demonstrate continued progress.

Profitability and financial strength are improving. Execution remains solid.

Together, these achievements support our path towards our midterm EBITDA margin target of 10% to 12%. Thank you very much.

Wish you a wonderful rest of the day and holiday season, if you manage to enjoy it.