Thank you very much, and a very good morning from our side here in Cologne. Thanks for joining today's call.

It's a kind of special call for us, not only that DEUTZ grew double-digit in the first half, as you all know, but also that we, as you all know, recently announced our transaction that we will also give a little glimpse in this call. Also like to take the opportunity to thank all of you whom we had the opportunity to meet in the recent weeks at various locations and occasions, and, of course, that we're looking forward to further explain and discuss this really game-changing deal with you in the future.

Having said this, I would like to hand over to you, Sebastian, and get our call started. Thank you.

Thank you very much, Lars, and also from my side, a good morning to everyone. Great that you're all joining.

Let me start giving a general overview on our first half-year results before I will then, as usual, not only go through the business units into details before handing then over to Oliver, but also, as Lars indicated, will mention again a few bit of content on our FFG transaction. Looking back at the first six months in 2026, we can say we're pretty pleased in how the year not only started, but how we actually moved through the first six months.

New orders, the trend was is is still very positive, €1.3 billion new orders. That is a 29% year-over-year improvement.

Revenue was also up, €1.1 billion, 11% over the respective period of last year. The margin in the first six months at 7.1%, at a very, very decent level, particularly, and I will explain that later, given that in our sort of legacy business, the business unit Engines, we are still seeing a fairly low demand compared to historical standards.

With that in mind, 7.1% margin is actually an extraordinary development we've seen so far. If I just break that down to the second quarter, as you see in the bottom part of the page, new orders €560 million, revenue €585 million, slightly new orders slightly below revenue.

That's not a point of concern, as we'll see later, because we had a very, very decent Q1 in terms of first in terms of order intake. We're growing here across all business units and all regions.

The margin, in the end, that's what, most of the most important thing, that on the margin, the bottom line, second quarter was up a bit again, 7.2%, a little above the first quarter and 1.4 percentage points year-over-year. Highlights, and there were quite a few.

Just to bear to keep that back in mind, and most of you have been following us the last six months. We further increased our global footprint in Energy with the acquisition in Latin America.

We acquired the company Maxitrust in Curitiba in Brazil. Closing happened in the second quarter as well.

The profitability of Engines rebounded, and again, as I just said a couple of minutes ago, in spite of the still not perfect market environment. We'll see later when we look on the margin how well we're developing here.

Very important, our business unit Service pushes on for further growth. That was also extremely pleasing.

I will work I will elaborate a bit further, the landmark transaction with regard to the acquisition of FFG was signed at the beginning of July. Look, we announced this acquisition of FFG, Flensburger Fahrzeugbau Gesellschaft, on July 9th.

Since then, myself, but also Oliver, we had the chance to speak to many of you. We spoke in London, Frankfurt, and last week, spent a couple of days in New York.

The reception on all these, virtually all these investor talks was extremely positive, not only constructive, but very, very positive. That gives us a lot of confidence as we move forward to our Extraordinary General Meeting later this month on August 24th.

Let me use today also to build on the picture a bit further. We are, and I believe everyone who listened to us and spoke to us will feel that, probably, in every conversation, we are generally excited about what this combination will become.

That, to speak, is what I want to leave today with. There are three things that matter.

FFG is generally an exceptional asset. It generated approximately €760 million revenue in 2025, a CAGR of around 50% per year since 2023.

That is that makes it one of the fastest-growing businesses in all of European defense. The trajectory from here going forward is actually what really matters, because we expect FFG to generate revenues above €1 billion in the coming years starting next year, at an EBITDA margin, we write here, we write here now we are very specific here, on above 20%.

That is really a best-in-class asset, as you can see. That is the destination this growth profile is heading towards, and the order backlog at the moment standing above €1.9 billion is what underwrites here this pass, yeah?

We expect in the coming months and years, obviously, this order backlog to significantly increase. More than 1,100 employees across nine locations, and more than 90% of the revenue comes from NATO customers, as well as the Ukraine, with at this point in time, less than 20% from the Bundeswehr alone.

Important is FFG is not a German government contractor exclusively, as many other assets are. It's a genuinely alliance-wide defense industrial platform, and that's one of the reasons why it perfectly fits to DEUTZ.

Second, the program network behind those numbers is the single most important non-financial assets asset in this transaction. FFG holds certified positions across more than 30 NATO platform types, including the Leopard 2, the Boxer, the Puma, the Marder, the Fuchs, the Fennek, the M113, serving more than 15 NATO nations and the Ukraine.

These are not just, commercial relationships. They are formally certified, technically embedded program positions built over decades.

That kind of institutional depth, that cannot be replicated quickly by no one, and certainly not in time to capture this outstanding procurement cycle that is opening right now. From the moment this deal closes, that entire network becomes part of DEUTZ.

Third, FFG is not just an MRO operator that happens to be growing. That itself would be exciting, but FFG is more than that.

It is a systems integrator with its own proprietary platform pipeline: the WiSENT 2, a multifunctional Leopard 2-based armored recovery and engineering vehicle; the ACSV, a modular armored combat support vehicle already delivered across NATO nations; and the next program waves, the TAR and the CAVS, representing substantial additional volume potential. This OE, this original equipment pipeline is what gives the order backlog its duration and what gives the growth profile its structural character.

Let me now turn to the structure, because it tells you something about the nature of this partnership. The total consideration, as you will already know, is approximately €1.6 billion, and around €1 billion will be paid in cash, financed through secured debt from a consortium of international banks, all secured, all signed, all without remaining risk.

The remaining around €0.6 billion will be paid in newly issued DEUTZ AG shares, which the seller family receives, or families, they're more, receive and will hold as long-term shareholders in the combined group. Third, strategic alignment: further variable performance-linked components, long-term focus investment agreement, and a Supervisory Board representation for the FFG families.

That last element was not incidental to this deal; it was central to it, quite frankly, because we did not want a seller who just disappears at closing. We wanted anchor shareholders who literally have skin in the game and will keep skin in the game, because then the incentives from day one are totally aligned with every other DEUTZ shareholder.

That makes it actually not only exciting, it makes it also extremely trustworthy and built for the medium and long run. The FFG families, as I outlined, they will join at a 29.9% stake, and that is a structure I'm extremely proud of because it serves, as I just explained, our shareholders.

It serves the interest of the combined group. Let me now turn to the earnings profile, because I want to be as precise as possible about how the accretion picture will build.

The share issuance creates initially a dilution of approximately 65 million new shares. FFG's stand-alone earnings contribution on a revenue base of approximately €760 million, taking the '25 numbers, and at the best-in-class margins, provides already a very strong starting point and offsets that dilution on a pro forma basis pretty much immediately.

From there, the accretion picture compounds in two further stages. The early cross-business synergies, such as Engines, service network, logistics, they will add further earnings uplift.

More importantly, the conversion of FFG's already contracted order backlog and the ongoing MRO business. That backlog, as I just explained, stands, give or take, above €1.9 billion, and it is awarded, it is contracted, it's signed, and it is converting.

That is the near-term earnings engine which will support this combined business. It does not depend on integration execution or qualification cycles.

That's important, and that's a message I kept, we kept sharing in all our investor talks. This business, this acquisition, makes already commercially, financially sense without additional synergy potential.

Obviously, it doesn't mean we're not going for that, but it's important. It makes sense without the synergy; the synergy add on top of that.

Longer term, the conversion of FFG's broader program pipeline into contracted revenue, the CAVS, as I mentioned, the ACSV expansion, WiSENT 2 growth beyond the current three nations, extend the profile considerably and well beyond 2030. We do expect revenue growth in line with double-digit NATO defense budget growth rates, and that is a structural tailwind, not a cyclical one, and that adds to the resilience of DEUTZ as a group.

What I can say today is that the direction on earnings, on cash, and on leverage is clearly positive from the point of close. The headline is this: we did not do a dilutive deal and we hope for synergies to catch up.

The accretion is there from the start, from the very beginning, grounded in contracted revenue, and it compounds from there. We will, of course, provide further guidance once we are through to closing.

Right, having said that, let me now move on to the development of our business units. Let me start with the business unit Engines.

Headline is very clear: profitability recovery accelerates. We're continuing here with an outstanding team to implement our portfolio and footprint strategy.

Just a few highlights. At our Porz plant, the largest DEUTZ plant here in Cologne, the performance program shows already first savings.

There's a lot of efficiency improvement, double-digit efficiency improvement on the assembly line 5. We do see higher cost savings due to a quicker relocation of products from Cologne-Kalk.

That's a bit of a satellite plant here, which we just closed. Literally, last week was the last last week Friday, we finally closed it, and we moved the products from Kalk here in Cologne to Spain, at much, much better cost base.

That went in line or that goes in line, both both aspects here, with the voluntary relief program for the Cologne site, production, but also production overhead, non-value-adding positions here, where we'll see around 100 to 120 FTEs leaving to further improve efficiency at conditions which are fair for the employees, but also favorable for the business. Then moving a bit on portfolio, the new G-Drive program.

Here we talk about a couple of new engines, including actually a 24-liter engine for genset customers. Here we're starting already with fixed with first fixed orders.

The next year, we'll see further growth in that. Important is it works.

Customers are ordering these products, very, very structurally strong demand and a very, very good cost base due to use of partners here. Partner is a good point, and we are bringing a very long-lasting, but long sort of hibernating partnership with Chinese FAW, we bring that back on track.

Here, for the best cost country supply of some of the legacy engines, which does not make sense to deliver them from high-cost Germany anymore, but there is still a structural demand all over the world, and we do that together with a partner in China. China is the next point here as well.

Our joint venture with SANY in China, in Changsha, it's progressing quite well now. First time I can really, truly say we're making really good progress here, in particular, not only compared to the previous years, and that's also because we made a bit of a change there.

We're using also more engines there for power generation rather than what it was initially designed for, for the use in heavy-duty trucks. Things are moving quite well, despite the fact that the order intake is not on the level we'd like to have it going forward, but it's important to focus on what we can influence, and we're doing that here pretty well.

Bring that to numbers as well. The demand in the second quarter slightly increased year-over-year.

Market is still a bit under pressure, but this is really not to be seen with a point of concern. It's moving pretty well.

We also now have a fairly healthy order backlog of €385 million. That's significantly higher than the €315 million we had a year ago.

The profitability, I just gave I just gave sort of the qualitative information on that. Cost savings from our FutureFit program, that was not the program I just mentioning with the efficiency in Porz and the closure and the closure of the facility in Kalk.

That was taking out mainly engineering resources last year here in Cologne as well. That program is pretty much not only not only full on fully on track, it's it's completed.

All the savings we had aspired to achieve have been realized, so that's very, very very, very successful. Then, obviously, there are always cost increases, labor costs, material prices, but we managed pretty well to offset these cost increases with respective price increases as well.

You see here in the, I will not go through all the numbers in detail, but you see that, we moved significantly up from the from '25 to '26 in the first quarter already with 3.7% margin, now in the second quarter 3.8%. That is still, far away from 7% or 8%, but again, given the the occupation the of the of the factory, that's pretty good.

Important news going forward, as soon as there will be an uptick in new orders, gross margin in this business will immediately kick in at double-digit level, and then will actually see a perspective which we will enjoy very much. Let me move on to the next business unit, which will be Service.

Here it's about growth. It's about growth and performance, and we have also, and we'll show the numbers in a bit, a very, very healthy order backlog.

We're expanding here as DEUTZ Service as an authorized service partner also for machine manufacturers and and and and service partners beyond the DEUTZ engine, particularly in the United States, in the Nordics, as well as with the implementation of our service business for the Daimler truck engines, which we exclusively sell to off-highway customers. The expansion particularly has continued in the United States.

We made another acquisition in California, G&T Truck Repair, that we acquired in June '26. The footprint in the US, and in this case in California, which was a bit of an untapped area beforehand, is now improving.

The DEUTZ Power Centers in the United States, they grow quite nicely, solid, solid field service growth. Very important also that we are we're realigning our dealer organization in the DACH region, particularly here in Germany.

Those who follow us for longer know that we've been working in the last four, five years quite successfully on insourcing or in-housing external dealers, but we didn't really touch the German the German network here. We're changing that now.

We did actually terminate quite a few contracts and are now renegotiating them, and that's what we mean when we're talking about a realignment of the dealer organization here. We see a very, very good progress as well.

Parts trading business, traditionally the one the part of Service with the highest margin, is continuously expanding as well. That's really bit going forward, obviously, DEUTZ Service is that what is is that asset what will in our ambition going forward not only support Engines, but more and more actually support also the other business units, most notably Energy, as well as Defense.

We're working here quite nicely, particularly on the genset service expansion with Frerk in Europe, but also in the US with Blue Star. Let me go to numbers as well.

New orders are up. You see, in the second quarter, focus on the second quarter now, new orders €152 million, revenue for the first time above €150 million, obviously here showing or benefiting from all the growth initiatives I've just mentioned earlier.

The order intake in the first half is now a 16.1% increase year-over-year, and that is exactly the level we would like to see in growing this important business. Order backlog is not as relevant of a number like in Engines because the because the through time of the business is, as you can see by €57 million, it's it's much, much quicker.

Important is compared with the number from June '25, where it was only €42 million, you see also here a healthy development. Very nice, and we're celebrating every record, of course, to keep the team motivated.

In June was the so far highest monthly revenue of €55 million, so that means, obviously, the entire team is aspiring to beat that number at the next possible opportunity. Things are looking quite nicely that this will obviously happen still in the year 2026.

The margin is a little bit diluted, but that's not a point of concern. That is simply because we're preparing for future growth, adding new more structures, adding technicians, because a lot of that growth only works with technicians.

We do, of course, focus more and more also on efficiency, on tech technician utilization, so that's why it's not a point of concern that the margin is slightly diluted, but also bear in mind, on a very, very high level. On top of that, obviously, we grow more in working on the machine than selling spare parts, so that also contributes to that slight dilution of the business.

Bear in mind, on group level, whatever we do here is always margin accretive. Let me move on to the next business unit, which is Energy.

I mentioned it in the highlight page at the beginning already. We acquired Maxitrust in Brazil, with that acquisition expanding here the coverage to Latin America as well, and also very important growing market.

There's further diversification of our US customers with Blue Star. Distributor orders are on record high.

We like direct orders as much as we like distributor orders, of course, but it's always good, to improve, increase both both foots we're standing on here, both legs we're standing on here. The ramp-up of Frerk for the second half is going quite well.

The new assembly facility in Schweringen in Niedersachsen is well on track, the commissioning here. Now, obviously, very important that this great business unit we have been creating over the last three years is now showing and proving that the equation 1 + 1 = more than 2 is been is is, yeah, will hold true.

Our teams working together, the international teams working together pretty well here to really expanding and building a global business. This year, we are already targeting, and when I say targeting, it's actually our planning and we're clearly building on achieving more than €300 million very profitable revenue.

The team's been super excited to grow that number to above €1 billion in the next five years. The market is supporting that.

The teams are excited to do that. That's another great great growth story here development.

A little bit a little bit also an exciting outlook: we are working here and elaborating a pilot case for the use of agentic AI in the business development in in sales in actually two facilities. There will be something probably we can present in the next months, because, obviously, it's important to support this strong growth without adding proportionally human resources on that, because we want to ensure that more growth gives extraordinary more profitability.

Let me turn into the numbers for Energy already, and here you see an ever ever-growing business. New orders in the second quarter at €55 million, and that includes €10 million from the Maxitrust consolidation, but there's also now an extremely strong order backlog, now €220 million.

That shows sort of the forecastability, planability, reliability in this business model is is is one of the one of the strongest in our portfolio, particularly if you compare to the first half of last year. The across our five business units, Energy is the strongest gross contributor, up €37 million year-over-year, driven obviously by the by the companies who joined us throughout this year, Frerk in Germany and Maxitrust in Brazil, but also organic growth, especially in the United States and also in in Morocco and China.

There is now, speaking on the margins, a significant recovery in the second quarter compared to the first quarter. We're now at 13.7% in the second quarter.

We explained that when we showed the first quarter numbers that the first quarter was a bit of an outlier due to the consolidation effects and some seasonality, and here you clearly see that we're moving already significantly up. The outlook for the rest of the year is also even higher than that, both obviously in terms of revenue, I mentioned the €300 million earlier, but also the margin level.

The good thing is here, as you can take that from the strong order backlog, the predictability not only in terms of revenue, but also in terms of profitability is extremely solid here. Let me move on to business unit New-Tech.

Revenue nearly doubles. That sounds super exciting, but it's still on a fairly on a fairly moderate level.

We do we do, however, work here obviously on our presence. DEUTZ will now act under the brand DEUTZ New-Tech.

Urban Mobility Systems, as well as Futavis, have been renamed and are now operating under the DEUTZ New-Tech brand. It's it's important, to position ourselves here with with with the strong brand we have.

We're now in this in this business converting the pipeline into revenue, scaling further projects, scaling production delivery capabilities, enhancing also efficiency in R&D. It's a lot about focus, focus, focus, and there are many, many market opportunities.

We're always, as very transparent on the the outlooks in the different business areas. This is obviously the business unit which is most difficult to predict, because it depends a lot on sort of overarching market and industry trends.

Important for DEUTZ is that we have to be here we have to be ready when the market, when the demand picks up, then we are there. It's a bit of an option value, if at some point the Engines business gets under more pressure from conversion to battery-electric products, important is to be ready, and that's exactly what we achieve with our New-Tech business.

In terms of numbers, new orders in the first half, and you see already we talk about completely different levels, we had €7 million new order. That is still reflecting that muted demand which I just mentioned.

Backlog is at €6.5 million. It's even a little lower than what we had last year, but again, with these sort of single-digit or low double-digit numbers, sort of percentage improvements or deteriorations are not as meaningful as obviously in other more established business units.

The revenue in the first half nearly doubled, particularly from the delivery of a few electrified excavators. Those go with solid gross margins, but obviously not strong enough the business is not strong enough to bring the EBIT into break-even.

On you can also see profitability has been improving compared to previous years, because again, focus, focus, focus on R&D activities, as well as cost discipline. That brings me now to DEUTZ Defense.

DEUTZ Defense becomes really like a a core pillar of the business. We are continuously committed and working on the defense tech ecosystem.

You all know about our investment and partnerships in ARX, as well as in Titan. With ARX, we launched the first series production of the GEREON ground system in in Ulm at our facility.

It's not a huge series, but it's a more than just a proof of concept, so that's great. There's more we are developing, particularly also in terms of resilient energy solutions.

We introduced at the Eurosatory in Paris a partnership with with H2C Solutions. We do also further ramp up the Sobek activities.

We talk Sobek, as we talk about battery-electric drive systems for unmanned for unmanned drones, for drones. We're working also continuously with R&D and new powertrain solutions.

There is a lot of interest. There are also after Eurosatory quite promising orders, not all of them we can disclose for confidentiality reasons, but the work the vector is here clearly positives.

Also, new orders from a drone package for the German Army for one of the three one of the three suppliers of the German Army, they build on our Sobek drives. As I just mentioned, Eurosatory was was a success for us, many, many, many leads for military engines, power packs, and hybrid systems.

Of course, as I mentioned earlier, the FFG acquisition was signed. However, in terms of numbers, or not however, in terms of numbers, we see substantial order growth in the second quarter '26 versus the previous year.

The order backlog is now at €43 million compared to €27 million beforehand. Also, the revenue is 47% above above previous year, now to €52 million, and the growth is primarily coming from Defense and not from others.

Bear in mind, we have also HJS, the engine aftertreatment specialist, part of this of this subsegment here, for which, by the way, the successful turnaround continues. Results are moving very much in the right direction, but that is certainly not the focus of what I'm mentioning here.

The EBIT is is also is also developing as expected in a nice way. It's a bit lumpy, both revenue and and EBIT is always a bit lumpy because we don't talk about serial business, one quarter you have more, one quarter you have less.

Important is obviously to look in the trend together. However, before moving on, what you just what you've just seen here is DEUTZ Defense as it stands right now.

Obviously, FFG, the acquisition of FFG, will change the scale of that picture totally. Our defense business will then exceed, as I mentioned it earlier in the call, €1 billion in revenue already in next year, 2027, and with that becoming a really, really not only integral part of the strategy, but a very, very relevant part of the business in all aspects: revenue, profitability, number of employees, and so on.

FFG will operate as a stand-alone unit within our Defense business unit. Its management, its workforce, its customer relationships, they will be fully preserved.

We will create a one strong defense business unit around FFG. What DEUTZ adds is industrial manufacturing scale, propulsion technology across the full power range, relevant obviously to FFG's platform portfolio, and, and that's extremely important, a NATO-wide service network.

Together, and we can be we can be quite proud of that, together this Defense business unit will become the only European-domiciled platform covering the full land vehicle lifecycle: propulsion, integration, MRO, and modernization, and that under one roof. That opportunity exists in European defense today, and we, together with FFG, we are able to capture it.

Right. Thanks for listening so far, and with that, I will hand over now to Oliver, who will focus on the financials a bit more detail.

Good morning. Warm welcome also from my side.

Let's get started. After a strong Q1, we saw an even stronger Q2, and that shows our transformation is on track, building the next DEUTZ is on track.

Just to remember, beginning of 2024, we still were in a three-shift operation on the engine business, and that was where the economic downturn on the engine side, the cyclical part of our business, kicked in. Since then, since the mid of 2024, we saw that we increased our margins in six out of seven consecutive quarters in a row.

That is a great achievement. That is a direct result of our strategic transformation.

That is a direct result of our top-line measures, of our bottom-line measures, cost discipline, cost reduction on the engine side, but especially also growing Service, growing Defense, and growing Energy. As we heard earlier, we need to keep in mind the cyclical part of the business, the engine business still remains on a rather low level.

That means the 7.2% margin we achieved in Q2 is a margin we achieved in a weak engine market, and once the recovery kicks in, we're going to see the full positive operational leverage driving margins even higher. Going to a bit more details on the financials, we see here, as we heard, the new orders 28.7% up.

Yes, there is some inorganic effects in that, especially due to the first-time consolidation and the contributions of Frerk, Maxitrust, and GNT. That total adds up to somewhere around €170 million in the new orders, but even taking that out, there is a positive book-to-bill ratio above 1, which means the business is also organically growing, which is a good sign.

On the revenue side, we see an increase here of 10.7%. All business units are growing, especially growth is driven here by the Energy business with the highest growth in absolute terms.

In terms of regional split, 55% revenue in Europe, 27% in the Americas, 11% in APMEA, and only 7% in China, no relevant dependency, as from the Chinese business. In terms of EBIT, we saw a significant improvement going up 43.1% to almost €80 million.

That is a good achievement. Of course, consequently, also net income increased significantly to €33.5 million, and that is even after taking into account a €12.5 million provision we booked for the voluntary program.

Not the FutureFit program we saw last year, but the voluntary program now where we're addressing also the operational part of the engine business, especially here in Cologne. Talking about R&D, CapEx, and working capital, R&D quota is going down in terms of sales, 4.0% after having seen 4.5% in first half 2025, so that is an achievement.

The absolute figures here stay rather constant. However, we need to be aware that we shift especially R&D expenses from New-Tech, where we show way more R&D activities streamlined and focused towards what market is demanding, and on the other hand, increasing it accordingly in the Defense business.

On the CapEx side, what looks as big increase here at the first glance is actually mainly driven by the renewal of a lease contract for one of the sites, which contributes €12 million to €13 million out of that increase, the biggest portion of that, while the traditional, classical CapEx outside lease is only slightly increasing. That slight increase is mainly due to some IT infrastructure projects and software projects which we are currently conducting around SAP.

On the working capital side, you see an increase to by 21% to 21.5% of sales, while here we need to keep in mind that the figure is a bit distorted due to the acquisition effects. We acquired several companies, as Frerk, Maxitrust, GNT.

Their working capital is included here. However, not the 12-month sales figures included.

If you would normalize that, working capital quota would be reduced by 1.4 or 1.5 percentage points roughly, bringing it to a lower level. However, we also see that inventory is increasing, was increasing throughout the first half of the year.

That is, of course, also a direct result of being prepared for delivering on the improved order situation going forward, especially in the second half of the year. Talking about inventory, that was also main driver for the cash flow development.

In Q1, we saw the operational results, we see cash flow from operating activities went down a bit to €32 million. That is mainly caused by higher inventories, as I just pointed out, also and especially to be prepared for delivery on the good order backlog, but also some severance payments of people that were leaving as a result of the FutureFit program, a result effect last year, cash flow effect coming in once people are leaving, and those were the two main drivers.

That means in terms of free cash flow, it converts to before M&A -€29.7 million. Here we need to keep in mind that the year before was positively distorted by a few items that we, as we pointed out at that point in time.

We come back here more to a normalized level, where we see the typical cyclicity that the H2 is significantly stronger on the cash flow side. In terms of net debt, that's a consequence, then, of the free cash flow before M&A, but, of course, also then reflecting our several M&A transactions.

That is then the reason why we are going up here to €520.5 million, including roughly €92 million of leasing. On the equity side, equity ratio remains strong.

Yes, however, it dropped a bit from 51.3% to 43%. That's the result of the acquisitions we conducted.

We had the debt-financed acquisitions, all of them debt-financed, and that is basically bringing down the equity ratio, but still to a very solid level and our targeted level of above 40%. In terms of leverage, yes, we went up, 2.1, that is including leasing here.

If you take out leasing, we are the 0.3 lower, at 1.8 without leasing. That is a moderate level still.

However, as we will go up a bit in the leverage as of closing of the FFG transaction, as we explained it over the last weeks, so that will bring us to a leverage in a range of more or less 3, but with a very strong deleveraging potential of the combined group going forward. With that, I hand over to Sebastian again.

Thank you very much.

Right, thank you, Oliver, for providing the details on the numbers. Let me first start giving an update, or confirmation of the guidance.

As we initially gave that guidance with a at that point, a bit limited market visibility at the end of February. The limitation of visibility we at that point took because there was this various crisis, the Iran war, obviously the Ukraine war, and so on.

We can now again confirm that there is no direct impact, nothing substantial. Always impacts, but it's all very manageable, as you can see also from our numbers.

We'd also see that our portfolio diversification is now really paying off. We used to be a cyclical company, a cyclical business, a cyclical share, with that high exposure on the combustion engine, on the construction sector, the agri sector.

Obviously, that still is there, but it is becoming less and less relevant because our Service business, our Defense business, our Energy business is not due to those cycles. It's actually embedded in a very, very strong economic environment.

In that sense, we're very happy to confirm the guidance: the revenue range between €2.3 and €2.5 billion, the EBIT margin between 6.5% and 8%, half-year down at 7.1%. It's pretty in the middle, but we're expecting, as usual, a bit of a stronger second half.

This is not due to just some hope on the engine recovery. We see signals here as well.

Also moving into July, orders are picking up nicely on still not +20% level, that's also clear, but things are picking up nicely. Even more important, the new additions to the portfolio, most notably Energy and Defense, we expect for both of them a stronger second half than the first half.

That's why we're extremely comfortable that we will achieve that guidance and probably not on the lower end. That's pretty much my confirmation of guidance.

Let me just briefly reflect on what Oliver and myself have just shared with you. We're continuing to grow in Energy, two acquisitions, but also that business or that part of the business which is already with DEUTZ for longer is developing very, very nicely: the US, Morocco, China.

Profitability of Engines rebounded, and I cannot iterate or repeat that more often, because we have to focus on what we can influence, and the global development of the construction market we cannot influence, but we can influence in which markets are we active, in which fields are we playing. That shows why are we moving in Energy and Defense, why are we building, doubling down in Service.

Of course, we can influence cost position as well as product portfolio in Engines, and that is exactly what we're doing. That's why we're now in the engine business on a level of profitability that was at that low level of occupation in the past completely unthinkable.

That means also, in turn, once the market is picking up even stronger than it's been picking up in the last months here, we're actually moving on really nicely there as well. Service growth I mentioned, and the deal with FFG I also spoke about.

On the deal with FFG, we will obviously over the next months, the more we have, we will give more updates. It's really a transformational transaction for DEUTZ, because we're adding more than €1 billion very profitable revenue to the business, and that will bring DEUTZ not only on revenue basis, but more importantly on profitability level, on EBITDA, EBIT, as well as free cash flow, in a completely different area.

We are still, as valued a bit like an engine maker, with a multiple depending on where we are in the valuation, sometimes 6, sometimes 7 in terms of EBITDA multiple, and we truly believe that with the portfolio we're now working in Energy and Defense in particular, it's not nearly reflected what potential, what valuation potential DEUTZ has. Time will obviously support that, but we are looking ahead on quite excitedly about what's here to come.

Let's move on now, please. In terms of timing ahead of us, the signing of the transaction we did beginning of July.

We're now first half-year results. In three weeks, 24th of August, we'll have the Extraordinary General Meeting.

It's going to be a virtual meeting, where we'll invite, or we have invited shareholders to vote on the capital increase relevant for the acquisition of FFG. Far, we received a lot of extremely positive feedback from many, many institutional investors.

Also, their proxy advisors have issued recommendations to vote for that, we received that extraordinary result. By the way, the first relevant and very relevant antitrust approval from the German Federal Competition Authority has been received last week, so that's also another sort of implementation risk which we never considered as a risk, but it's always good if these steps have been completed.

We expect by the end of this year, we're writing here potentially by the first quarter, but at the moment our assessment is rather the end of this year, we expect final regulatory approvals from other jurisdictions to be granted and thus a closing of the transaction. That's where we stand right now, and in that sense, we would like to thank you for listening, and obviously, as usual, look forward to your questions.

Hi, good morning. My first question would just be on the general market environment you're seeing and how Q2 progressed versus your expectations from Q1.

I'm just wondering if generally the order intake dynamics, I'm guessing May wasn't fantastic, particularly for Engines, but I could be wrong. I'm just wondering you briefly commented on orders picking up nicely in July, but would be good to just get a bit more color on the run rate coming out of the second quarter into Q3.

Lasse, thanks for your question. It was actually fully according to our expectation, not beyond, but also not below.

We always need to bear in mind that we had a very nice jump in order intakes in the first quarter, and that obviously leads in terms of engines to higher revenue than before in the second quarter. We were slightly below revenue in terms of order intake in the second quarter, but that's very slightly.

That's pretty much, I would say, not relevant. What we see here at the moment is, particularly in construction, there are very positive signs.

If you look on sort of our geographic end markets, just take a look at the United States. That our main customers in the United States are Terex, JLG.

Their end customers, for example, is a main customer, United Rentals. Look at how they develop.

They have given also updated numbers last week, and are very positive signs, and so that's obviously translates also into our order intake at us. Always with a bit of a delay.

They need to work off their inventories. However, that's as much as I want to say about how we moved into July.

Obviously, July, we'll report in October when we report Q3. In principle, I can say to give you a bit of light, US is going nicely.

In Europe, some customers are increasing orders, others are still a little reluctant. Also bear in mind, it's July, August now, so that is not the time in the year where construction and agri customers are really ordering.

What we feel is that, potentially after the summer break, things will become more clear. In principle, as I said, fully according to expectations, and fully according to also what we put out on guidance, the year is pretty safe.

Perfect. The second question is on gross margins.

These were down a little bit in the second quarter. It looks like you had the same dynamic last year, I'm just wondering sort of what's the driver of that effect in the second quarter versus Q1?

That's a typical seasonal pattern you've seen. A little bit on the gross margin side, but due to you correctly pointed that out, this is slightly lower.

However, we're expecting that, especially if you look towards the second half of the year to increase again. What you're going to see then is basically that especially the newly acquired or newly built-up businesses, especially Energy, especially Defense, especially also the Service business is structurally going up.

The only in fact margin kind of dilution we see is a bit on the Service side due to the effects that Sebastian pointed out earlier. That is, if you acquire businesses which are slightly below the current margin level, that's significantly margin accretive on the group level.

That should work also and out on the second. Of course, the biggest impact is then from the expected recovery on the engine side, which has, of course, the most important impact on the gross margin due to the positive operational leverage.

Thank you. Then the third one is on the OpEx level in the second quarter.

That was up again. That's up materially year-on-year, but also on the first quarter.

Just wondering, is that sort of the right run rate for the remainder of the year and also looking into '27, or how should we think about that?

I wouldn't talk about the right or wrong run rate. I think what you need to keep in mind, we are consolidating additional businesses.

We acquired Frerk, we acquired double down at the end of last year, we acquired outside Eagle at the end of last year, we acquired Maxitrust and so on. On the operating cost also SG&A cost, you see that those costs are coming into the game.

Ultimately, we look on the EBIT margin, and that is what counts, and the EBITDA margin, and that is where we're expecting the further increase.

Makes sense. Then the final question is just, can you give the organic revenue growth figure for H1 or the second quarter?

Yes, I can do it for let's say for H1. If you take the acquisitions we conducted in H1, Frerk, GNT, Maxitrust into the equation, they accounted for approximately €170 million, 1-7-0 million order intake and 30, almost €30 million revenues.

If you include also the acquisitions we did last year in H2, Sove, DEUTZ Turkey, Down Under, you come then in total, including the others, of approximately €200 million impact on the order intake and approximately €50 million impact on the revenue if you want to have a pure like-for-like comparison H1 '25 against H1 '26.

Perfect, very helpful. Just final one, would you be happy to disclose the engine volumes for the first half?

It might be in the report, I might have missed it.

Yes, I'm super happy. 68.X units, 1,000, 68.X.

Thousand, yeah, that's important.

Perfect. Thanks very much.

Thank you very much. The first is actually a clarification because you mentioned the €1 billion for FFG and then for Defense.

I just want to clarify, do you see for FFG as a stand-alone on an organic base the €1 billion for '27, or has that been a statement for the Defense business unit overall, including future acquisitions?

Indeed, I mentioned that FFG will achieve a revenue above €1 billion next year, probably a bit above €1 billion. The statement that the Defense business unit will be above €1 billion also holds true, of course, because it doesn't have negative revenue.

We're expecting on the sort of Defense and others, as it is right now, also grows year-over-year. What we're not providing as of yet is a very detailed number for '27, very simply, as we're conducting our planning only later this year, and I don't want to by accident give an outlook or a guidance for the next year.

That's why, unfortunately, we'll have to keep it a bit more on a high level with above €1 billion at a very attractive margin. Everything else will follow later through the year.

I hope you understand that.

Sure, fully understood. The second one is then a bit on the order intake in the Energy business.

We know it is lumpy. There might be possible projects at Frerk, there might be dealer orders at Blue Star.

Do we need to brace ourselves a little bit for Q3 also being a bit lower, and then a large chunk in Q4, or is that a bit more evenly distributed in the second half? Because for the annual run rate, we would need to see a bit of a pickup from where we stand in Q2.

We see that. Our current assessment, when I said earlier about above 300, I think, Oliver, the right number is 320, 330, that's what we expect on a full-year basis at the moment.

There's very, very little risk in that because that's almost covered by fixed orders, a little bit of distributor business in the US, but that comes in pretty reliably. Here I see hardly any concern, honestly speaking.

Of course, the second half is stronger than the first half. Because in the first half, neither Frerk nor Maxitrust has been part of the entire six months.

They both joined a bit later. Secondly, we do have a bit of a seasonal effect at Frerk.

They had that last year as well. Obviously, you can't explain that with something like harvesting season, but it seems to be typical in this business that orders are being placed throughout the first half, but they've been delivered rather in the second half.

We are very, very, very bullish or let's say positive on the outlook on Energy in the second half. Honestly speaking, I believe that's probably the strongest foundation we have.

If I were to bet money, I would put a lot of money on everything, but I would even put more money on the second half of Energy, if you understand.

True. Okay.

The final one is actually, let's say, a bit of a combination. You had some one-offs for closing more efficiency measures in the engine business.

Now, FFG comes a bit on top, and to my understanding, we will have some serial production, which is largely taking up for the brunt of the sales increases of FFG. Is there an idea that you can harvest a bit more like sending out employees maybe from the direction of Cologne rather to Flensburg, all together with your idea of India?

Then, do we need to brace ourselves for a bit more one-offs in the second half?

Not significantly. Obviously, FFG is building up with a plant.

It's well on track. It's in Handewitt, which is a neighboring district to Flensburg.

We've actually visited it on Monday. It's looking very nice in terms of development.

They will have Richtfest. I don't know what it is in English, honestly speaking, but the one of the important milestones where you celebrate that the structure of the building is completed, so that will happen soon.

Obviously, they require also additional personnel. Of course, we'll offer people working here to move there as well.

Let's see whether that's interesting. It's very nice area up there, I wouldn't necessarily say no, because other people go on vacation there, we may actually send people to work there.

It's a bit of a privilege. However, we also do not see beyond the 100 to 120 FTEs which will take out as part of that voluntary redundancy program here, we at this point in time do not see any additional need to structural reductions here at the engine business.

Obviously, we're continuously working on efficiency gains, but probably the number we mentioned will be more than sufficient for this year as well, because bear in mind, we've done a lot of work in terms of reducing permanent or replacing permanent by temps already in the past years. Efficiency measures will continue year after year, but not necessary for the second half of the year.

On your questions regarding one-offs, yes, there are going to be a few millions more one-offs, of course, but that is typically in line with what you are expecting with a transaction of that size, a bit on the typical professional consultants you need, and on the financing side, of course, but nothing extraordinarily high.

Right. Thank you very much.

Hi, Paul. Can you hear us?

We can't hear you.

Yes, good morning. Yes, it's Paul from Berenberg.

Thank you for hosting the call and for taking my question. I have a question on the free cash flow.

You've confirmed high double-digit million for the year, and H1 came in at -€30 million. That implies a swing of well over €100 million in the second half of the year.

Could you please break that down between the working capital release and operating cash, and specifically how much of it depends on the €79 million, roughly, inventory build-up converting in the second half of the year? Thank you.

Yeah.

Sure, I can do so. Basically, they are exactly the two elements you mentioned.

On the one hand, we are expecting very strong operational performance throughout basically all business units, or the four relevant business units in H2. That's going to convert to cash.

On the other hand, we are actively addressing that topic of working capital. We started a program to bring that down a bit, as you always do it every few years.

We see good potential there, and compared to current levels, we're expecting a €60 million, €70 million reduction throughout all the layers of working capital. Of course, a big part of that is related to the inventories.

That is also, if you look at the history of DEUTZ, you see typically that kind of cyclicity, that the H1 is weaker in terms of cash flow, the H2 is stronger. You're building up for seasonality patterns, certain inventories throughout your H1, and that is then reverting in H2.

I'm not at all concerned about that.

Got it. Thank you.

That's helpful.

Good morning. Can you hear me now?

Loud and clear.

Hi. Good morning, and yeah, thanks for taking my questions.

One would be on the outlook for 2026. You already mentioned that you're feeling quite comfortable with guidance, and looking at the H1 performance, you're already comfortably in the range for adjusted EBIT margin.

In terms of revenue, you need a bit of a pickup in H2. Would be interested to hear a bit your view, what will be the drivers in terms of business units here for the pickup in revenue in H2?

That's the first question.

Pretty much all but New-Tech, because New-Tech is just not relevant in terms of top line at the moment. We'll see a bit of an uptick in Engines, a bit, but that's well in line with the current sort of bottom-up projections from the teams.

There's no sort of hope in a way left. Secondly, I mentioned it earlier already that the second half in Energy is expected to be larger for two reasons.

First reason, because Maxitrust and Frerk haven't been part of the group since the 1st of January, so that's a very, very simple reason in a way. Secondly, that particularly Frerk, we do, based on the visibility in the order book, we do see more in the second half than in the first half.

That's Energy. On Defense, we received, particularly at Sobek, a few relevant orders to be delivered in the second half.

They do relate to the drone package that the German Army has ordered with three drone suppliers, one of them working with DEUTZ in particular. These orders have been placed.

There was actually an additional order very recently. Here we do not talk about a huge top line, but it's healthy margin, as well as some diesel engine orders from other NATO customers coming in.

On the Service side, last but not least, we have for the first time surpassed the €150 million, the run rate on a quarterly basis, and the run rate in June and also in July is well above the €50 million. That's pretty much supporting that top-line prognosis for the second half.

Thanks for that. The second one would be more on the medium term.

You have the medium-term targets, more than €4 billion sales, 10% EBIT margin plus. Obviously, including FFG, it will be much more than that.

In your view, what would be the right timing for updating these targets? Is it already when you get approval for FFG, when FFG is close the deal, or what's your view here when we could hope for an update?

We do plan an update in the second half of this year. What I can say, well, this is very simple to say because we are already in the second half of this year.

I noticed before,

we will give an update later this year. What I can say already, and you implied it with your question, Klaus, that our €4 billion target which we initially projected for 2030, we will achieve much, much, much, much faster, not only the top line, but also the bottom line.

I wouldn't even rule out that we already achieve this next year, or we're a little short of that. We require, because this is big statement to be made, and obviously, we'll need a bit of a more bottom-up planning, particularly on FFG side.

There are changes in accounting principles, we're moving from Handelsgesetzbuch, from German HGB into IFRS. Obviously, that doesn't change the business, but it changes the realization of revenue and of profit.

We want to run that exercise diligently before informing the capital market on something, because the worst thing we would be, we say, "Oh, yeah, we're going to be at the €4 billion," which as I said, could be possible, and then due to some accounting issues, well, we are at €3.5 billion only. That'd be terrible, so that's why we're working on that diligently.

As always, Klaus, you and the other analysts, you will be one of the first to know.

Thanks. Thanks for that, very helpful.

Have a good day. Thank you.

Thank you very much. Thanks for being our digital host, but also thanks everyone for dialing in.

Thanks for your interest in DEUTZ. Thanks for your trust in DEUTZ, in the share, and for your shared excitement on what is ahead of us.

I just want to conclude, this is really a pivotal moment for DEUTZ as a company. We have always talked about a transformation.

We've been also working on the transformation in the last years. We are on that journey since 2022, really waking up a company from a bit of a long-term sort of sleep sometimes it's the way it feels.

We did the homework in the first two years, fixing basics, bringing the company into a profitable position out of which we're then able to grow. I'm not saying it only started with that FFG transaction, because obviously we've done a lot of very great things in the past.

Now, this is the biggest step, and it's a step which we tested and prepared very diligently, and we feel we know that this is the right asset at the right moment. What I can promise is that DEUTZ in '27 will be completely different, a larger, a more profitable, and also eventually a more valuable company.

It's great that you're interested in DEUTZ for us, but also for yourself. Thank you very much.