Arteche Lantegi Elkartea, S.A. (ART) Earnings Call Transcript & Summary

Good morning, everybody, and welcome to the Result Presentation of Arteche the first half of 2026. My name is Claudia Ortiz and I'm in charge of our Investors Relationship. And we have here Alex Artetxe, Ixone Vicente and Luis Maria Perez. So you can access the presentation as well as the webcast link through our website, www.arteche.com. [Operator Instructions] And I'm now going to give the floor to Alex Artetxe.

Thank you very much, Claudia. Good morning and thank you very much for being here today at our results disclosure for the first half of 2026. I'm Alex Artetxe. I'm the Chairperson and CEO of Group Arteche, and I have here with me Luis Maria Perez, the Director General; and Ixone Vicente, who's the CFO. It's a pleasure to share with you details concerning the company in this first half of the year, a semester in which we've had lots of activity from an operational point of view and also from a strategic perspective. The results that were presented today show how strong the business is and how well our team is working and the resilience and capacity that Arteche has to carry on growing in an environment in this sector that is offering major opportunities, but also there are significant challenges as a consequence of an external environment that once again is complex and very difficult to deal with. It's been very 6 intense months. Our activities have grown. There have been -- major progress have been made in terms of corporate development. We have the incorporation of the continuous market, the extension of our capital and the acquisitions of Uptech Sensing and SEG Electronics are milestones that strengthen our competitive position and have sped up the development of our strategic plan and this is what we're going to be talking about. This allows us to address the second half of the year and the future with a company that is more solid, more technological and with a value proposal that is more and more thorough for our customers. So having said that, let's move on now to the main milestones of the first half of the year. Let's kick off on this Page 4 with a rapid review of the first part of the year from the point of view of corporate development. And if we would have to define this semester with only one word, I'd say that it would possibly be transformation. Because during this period of time, we have made significant progress in terms of our strategic goals, which have reinforced our position in the market as an industrial, technological and more and more international company. In February, we were listed on the stock exchange market in Spain. A very important milestone in Arteche's evolution and it also represents that we are achieving the ultimate goals of our road map. And this means that we have more visibility in terms of the financial markets. This has increased our liquidity and also allows us to access international institutional investors. And a few weeks later, we announced the acquisition of Uptech Sensing, a company that specializes in optical sensors and in the smart monitoring of electric assets. And this fully fits with our digitization and service solutions, which supplements our digitization capabilities and this also allows us to develop solutions that have a higher added value for our customers. In June, we also acquired 100% of SEG Electronics, a company with an extensive track record in terms of protection systems and with a strong position in the distribution segment and in Central European markets. This operation represents a very significant step in our strategy of grid automation because it's incorporating new technological capabilities and it's extending our presence in a segment that is growing a lot and where data centers play an outstanding role. And finally, we also invested EUR 100 million with close attention paid to institutional investors, international institutional investors, and this reinforces our free float. It consolidates our presence amongst some of the most important international investors without modifying our industrial strategy nor the company's management model. But as we'll see now, these developments in terms of our strategic strategy was also followed by excellent financial results. So in a nutshell, we believe that this first half shows that Arteche does not only carry on growing, but we're doing so in a sustainable manner and fully in line with our corporate strategy and we are building a platform that is becoming increasingly solid. I'm now going to give the floor to my colleague, Luis, so that he can talk about the business itself.

Thank you very much, Alex, and good morning, everybody. So what we're going to do is review the main financial magnitudes that Alex was already talking about. Well, there's very clear cut conclusions and that is that we are growing in a very balanced manner in terms of activities and profitability. So if we start off with the orders that we received in the 6 first months, you can see that we've grown by 16%. So we reached a figure of EUR 338 million, which is a record-breaking figure for a semester. So that means that we have a pipeline that is very close to EUR 417 million. And as we'll see later on in the subsequent overheads, this gives us a book-to-bill, which is 1.22x and we have the next 8 months fully covered. So continue now with the sales of the business figure. It's nearly EUR 278 million, which is growth of 10.7%, very solid and even at current constant currency would be a little bit higher than that. And the next metric has to do with our direct margin, which is a very important unit because this allows us to evaluate the success of the efficiency strategies and also the commercial strategies of the company. We've reached EUR 120 million in direct margins, which means that our growth for this year is 30%. So if this metric works and with a little bit of control as regards structural costs, it means that EBITDA -- well, it has a repercussion of EBITDA and we can see that there's a very important figure with EUR 51 million, which is 18.4% of the sales and this represents a growth of 29% compared to the previous semester. And the end result for the company is nearly EUR 31 million in profit, which is an increase of 44% compared to the previous year. So we have created more value for the shareholders. And the last metric refers to the net financial debt ratio and it's 0.5x EBITDA. And we've made some -- carried out some inorganic operations with Uptech and SEG Electronics. But let's move on to the next page in which we're going to see the advancement in terms of product lines. As you can remember those that are following us, Arteche is based on 3 pillars. We have the first pillar, which is where we talk about Measurement and Monitoring and these are transformers. So basically what we've done in these first 6 months of the year, we've increased our production capacity. So we've made available to the market an extended capacity, which means that we have achieved an increase of 20% in the number of units that we can produce. And we can, therefore, reduce lead times for those product lines that were more tensioned and specifically HV above 245,000 volts. And we've also opened a new plant in Mungia where we're going to manufacture capacitors and, as you know, these are the key elements of the future for HVDC. And we're also about to open a factory in China, which we hope will be up and running by the beginning of next year. And finally, we've made some powerful investments in the LUAT laboratory in Mungia, in which to perform trials that we've performed in external laboratories. Moving on to the second pillar, which is grid automation. Basically, as we've said, we have the 2 acquisitions, Uptech and SEG Electronics, and I'm going to focus a little bit more on SEG Electronics although later on we'll see the transparency. SEG Electronics is a German manufacturer that is on the outskirts of Dusseldorf. It's a leader in terms of industrial applications and distribution and protection systems. They've got 55 years of experience and not only that, but they also have offices in Poland, in Arab Emirates and the United States. Why did we buy them? Because they specialize in protection algorithmics. And we've also strengthened inspection and control as we'll see later on. We do not only have control equipment and control systems, but we also have protection devices. And finally, what we will do is have the consolidation of the development platforms for the new IEDs. I'll explain this a little bit later on. And the third pillar is grid reliability. And what we have been doing since last year is reinforce our range of products and increase our commercial activity. So we've been involved in some green hydrogen projects. We've signed agreements in recent months and we're working on a new value proposal for data centers. And finally, we also have other framework contracts for the supply of reconnectors especially in Brazil, which is one of our most important markets. But as I mentioned before, I'm now going to move on to the next page, okay, because I'm going to be talking about the logic behind the grid automation strategy and how the acquisition of SEG fits in with all of this. Well, let's see. Firstly, you can see this chart, you can see that there are 4 levers. And as regards protection and control system for grids, we have the hardware components and the software components. And the hardware component, which is the chart that we call SEG, and these are the protection equipment in SEG and commenced in Germany. And the second component of this chart has to do with the control IEDs. All of these IED controls, the switches and positioners, et cetera, are going to be developed at our plant in Madrid together with Uptech, which as you know, they have their research and development center in Pamplona. Until now, we've spoken about hardware, let's talk about software. Well, these control and protection systems have a software that communicates the different pieces of equipment and also communicates with the offices of the electricity firm. So the control systems that are based on communications are also going to be developed in Madrid and we are going to assemble them in cabinets in 3 plants; one in Brazil, another one in Mexico and the other one in Madrid. And then finally, the final part of this automation strategy corresponds to the joint venture that we set up last year together with [ Hitachi ], with Vitare and what they do is manage the assets and substations and they have a top-level software that is installed in the control systems of utilities. So with the incorporation of all of these acquisitions to Arteche's portfolio, what we have is a value proposal, top quality value proposal, that allows us to deal with the so-called traditional or historic manufacturers making the solutions. And now I'm going to give the floor back to Alex again.

Well, okay. In the initial summary and when we spoke about the main milestones, I'm now going to refer to one of the most important things is the operation that we carried out in June, the extension of capital. And well, it was EUR 100 million mainly focused on institutional investors. And the main objective of this operation was not to modify our industrial strategy nor the structure of the company, but we wanted to strengthen our profile on the stock exchange and that is in the Spanish stock exchange. And this operation has allowed us to increase the free float. It's also improved the liquidity of our shares and we also find that it's more efficient when we negotiate in the market. And we've also increased our attractiveness as regards international institutional investors, which is a very important thing after joining the main market. And having a more extensive shareholder base that is more diversified will allow us to improve our visibility and people will get to know our company better and it will create more value for all of our shareholders. So we believe that this operation represents another step in the growth process of Arteche as a listed company. So okay. Well, now let's move on to the next overhead and we're going to be talking about our contracts and It's just one of the things that we usually present. So all of you that follow this presentation, we have 2 snapshots. On the one hand, we have a geographic snapshot and then we also have one showing the 3 pillars. So firstly, I want to say that we've had a 15.7% growth, which is very positive and is over and above the market growth figures and, which, I said before, this allows us to reach pipeline that is close to EUR 338 million with a very significant ratio. And this makes us feel very comfortable when we set up our manufacturing pipeline because we have the next 8 months or so fully programmed. So that makes us feel very comfortable. So from the point of view of geographies, as you can see, there are 2 geographies that are really the driving forces. Basically it is Europe and the North of Africa and North America with a very high double-digit growth, which we hope will continue throughout the rest of the year. And we have the Asia Pacific region and the growth that appears here is only 1 digit, but we should eliminate the one-off in 2025, a mega contract that we had in Australia, which we would be talking about a similar level of growth and where we have to get something done. As regards to the second part is Latin America because of the timing of projects in Brazil because we have to -- we'll close them over the next few months, which is already happening by the way. And we also hope that we will recover Argentina, which is one of our traditional markets that has not yet been fully recovered. But if I shift the focus now and we can see that the 3 businesses or the 3 pillars, we can see that the one that grows most is the one that has to do with grid reliability. And we've had, as I said before, we have some very significant projects, green hydrogen for instance. And then we have a Measurement and Monitoring business, which is growing. And what is flat is the grid reliability business. So we've seen that well, there was a stagnation of the PV business in Spain and this has had an impact of course on the Control and Protection Systems segment in Spain. But I'm now going to move on very quickly to the next page, which is very similar. But in any case, we're not going to be talking about contracts, but we're talking about the business figure and we're going to be talking about sales. Our growth has been very close to 11%. And here we now can see the effect of the increased capacity thanks to the investments made in 2025 and in the early months of 2026. And we're going to see the effects of the second half of the year, which is where we'll have more manufacturing capacity for medium and high voltage. And for each of the regions, we have a very similar effect. We have grown significantly in Europe. We've grown significantly too in Asia Pacific, a little bit less in North America. And in other parts, we are somewhat at lower levels because of the timing issues that I mentioned before. And now looking at this by business units, we can see that our business is growing and the increase in the grid will have more deliveries in the second half of the year. What we can see here? Well, we can see this has to do with the excellent results that we had at the end of 2025 and things that have been readied and delivered this year. So this is the summary of what the business figure is like and I'm now going to give the floor back to our CFO, Ixone Vicente.

Thank you very much, Luis, and good morning, everybody, and thank you very much for attending this conference call. Well, after reviewing the evolution of the business and the main strategic milestones, I would now talk about the financial evolution of the half of the year. And if I would have to summarize the results in only one idea, what I'd say is that it's been a semester in which what we have demonstrated is that our business model is strong and that growth becomes a profitability and profitability becomes a profit and profit becomes cash flow. And this is what we are going to see in the next few slides. But starting off now with profitability and focusing on EBITDA. Well, we can see that there's been a very, very positive evolution and I think that this chart summarizes perfectly well what's happened in the first half of the year. The EBITDA margin is still improving semester after semester and in this first part of year, it has reached 18.4% of the sales, which is the highest level ever of our history and to date. This means that there's been an improvement of 262 basis points (sic) [ 260 basis point ] compared to the first semester of 2025. And this has been boosted by the business of the growth that Luis has just pointed out and it's also been brought about by the continuous improvement in our operating efficiency. And as regards to absolute EBITDA reaches EUR 51 million, which is a growth close to 30%, which is much higher than the growth we've seen in terms of sales. So what we are demonstrating is that we have a very strong operational leverage. As the business grows, profitability grows even more. And I think that these results confirm that the investments that have been made in recent years in terms of capacity and innovation and efficiency are now very clear and this has an effect on our P&L. And the direct margins, that's an internal indicator that we use to measure the results of each one of our businesses. And the truth is that this indicator in the first half exceeds 40%, which is an improvement of 380 basis points compared to the same period of the previous fiscal year. And this is the end result of several years in which we have executed the same kind of strategy with a very strong discipline. And in other presentations, we have presented many initiatives that we were implementing and I'm talking about optimizing the supply chain and I'm talking about a higher level of procurement efficiency, a better management of logistic costs of the work that is done by innovation that allows us to launch products that are more competitive and more profitable. And I'm talking about the increase in productivity and investments geared towards increasing our capacity and optimize our processes. So all of these initiatives are no longer expectations, but these are the real results that we are seeing in our P&L. And then apart from that, we also have to add a favorable product mix and the pricing strategy that is very well developed and also a positive evolution of our currency. And this improvement in margins is what actually explains this very good evolution of EBITDA that I've just mentioned. And now moving on now to the next slide and focusing on the net profits. We can see how this improvement in terms of profitability reaches the final line of the P&L. And in the first half of the year, we've had a net profit of EUR 30.6 million, which is 44.3% higher than the figure reported in the previous fiscal year. And once again, the main driving force behind this growth is the evolution of our business and that is the operating outcomes have increased 34% and now reach a margin over sales of 15%. But in addition to this, well, we have the good performance of the business and we have a very good financial discipline and a very good financial structure and the favorable evolution of the taxation issue, which has served to reinforce the growth of these profits. But on this slide, I would also like to underscore something else and that is our commitment towards shareholder dividend. In this first half of the year, we've paid out a dividend that corresponds to 50% of the profits of the previous fiscal year. In other words, EUR 22.6 million, which are equivalent to EUR 0.39 per share. And this means that for 1 more year, we have fully reached our commitment, the commitment of the Strategic Plan, which was to at least pay out 30% of our profits. And moving on now to the next slide and to close the financial segment, we have to talk about cash generation. So we still maintain a high level of capability to transform our results into cash. And in this first half of the year, we have a free cash flow of EUR 21.9 million, which represents a conversion ratio of EBITDA of 43%. And if we exclude -- from this flow, if we exclude the expenditures on expansion investments, well, that ratio or that conversion climbs up to 68%, which I think is an indicator that reflects the capability that our business has of generating cash in a recurrent manner. And in this chart, which is one of the charts that we usually show and now going on the different business items as usual, you can see that the main cash outflow corresponds to CapEx. And we still continue with our investment plan and with our capacity expansion plans and with our technological development plans. And I'd say that all of them are fully in line with the growth strategy, the long-term growth strategy that is. And thanks to this cash flow generation and thanks to a very disciplined management of the working capital, we have maintained a very solid financial position. We have closed the first half of the year with a net debt of 0.05x EBITDA after 2 corporate operations. So we'll see what they do for the results in the next few months and the payment of the dividend. And in this case, it's a positive figure and that is our share perspective is positive. And now I'm going to move on to another chart that we usually show in this disclosure. We still have a very diversified financial structure divided by instruments and also divided by maturity dates with an average cost of approximately 3.6% and an average life in excess of 4 years. And if we also take into account that about 79% of our long-term debt is protected against possible variations in interest rates, well, we have significantly reduced our exposure to the financial environment. So in a nutshell, we are closing a semester with a business that is still growing, that is still improving its profitability and also with a very high possibility of generating more cash flow and with a very solid balance sheet. And I think that these 3 ideas, I think that they show perfectly well what it is we wanted to achieve through our Strategic Plan. We wanted to grow more and better and do so by maintaining a financial structure that is robust. And this closes the financial side of things and I'm going to give the floor back to Alex.

Thank you very much, Ixone. And now we're going to move on to the progress made in terms of sustainability and, as you know, this is an essential part of our strategy. And for sustainability and respect for the environment and for people and being transparent is fully in line with our values. And this is a way of managing the company properly and creating value in a sustainable and responsible manner. So this is why we are still making progress as regards to achieving our 2030 targets both in terms of the environment where we are improving our recycling indicators and reutilization levels. And we are also reducing our carbon footprint and we are increasing the consumption of renewables, which accounts for 80% of the consumption of electricity in all our plants in the world. And also from a social perspective where we are also boosting equal opportunities in the organization and we reached 34% of women in the management positions to the company. And we also want to achieve 0 occupational accidents and we have a very consolidated system. And as regards governance, well, this half of the year has been very significant because we've joined the continuous market. We've reinforced our transparency standards and governance control. And we have 40% of women on the Board and we were supposed to do this by the end of 2026. And it's also wonderful to share with you our decarbonization targets. We have a company that is helping us to achieve higher levels of decarbonization, RCI. And this reinforces our commitment towards sustainability and encourage us to continue with this work. We are convinced that a more sustainable company is also more competitive and is better ready or better -- it's more ready to prepare or generate value in the long term that is. And now we come to the final part of the presentation. With this, what we will do is deliver a clear vision of what the things that we've pointed out until now. And if we were to have to summarize these last 6 months of the year and after what has been said right now, I'd say that it's been a semester of growth and profitability, of transformation and also execution too. Because we are still growing at double digits and we have a record pipeline, which gives us excellent visibility. Our profitability, we've seen that this growth has been supported by a significant growth level and we've reached historic levels both in terms of direct and indirect margins and this growth is becoming increasingly efficient. And well, we're still advancing in terms of corporate development issues too. The incorporation of SEG Electronics and our investment in Uptech Sensing, as Luis pointed out, mean that we have a much more extensive value proposal in our strategy and this is taking us towards technological solutions that have a greater added value. And our presence in the continuous market also represents a very significant step in the consolidation of Arteche as a listed company with more international visibility. And all of this has been done according to the objectives contained in the Strategic Plan that we maintain a very solid financial structure with lots of cash generation possibilities. And we believe that these results do confirm that we are successful in our strategic plan and that the company can carry on growing over the next few years. So in short, we think that the rest of the year will be perfect, but you can see some very solid foundations in our market that have been driven by electrification, by the modernization of the grids and because there's a growing need for equipment that is more sustainable, resilient and smart. So our technological office has incorporated new technological capabilities, which means that we have now become stronger. And having said that, we're now going to explain what we think is going to happen in the rest of the year 2026. At the beginning of the year in February, we shared with the market a first range of guidance based on the information and visibility that we had at that point in time. And since then, the evolution of the business has been positive and what is even more important is that today, we have a high degree of visibility as regards to what is going to be done in the next few months. So although in the last 2 days we've seen that tariffs have been applied once again in the United States. But according to our analysis, we believe that there's going to be limited impact for our business. So that's why we believe that our expectations are going to be better for the closing of the fiscal year. And here you can see the figures that we hope to reach. Between EUR 565 million and EUR 590 million compared to the previous range that range between EUR 555 million and EUR 585 million. As regards EBITDA, our forecast says that the range would be EUR 92.1 million to EUR 100.4 million. Initially, the figure was EUR 87.7 million to EUR 95.4 million. And we've also revised our profitability expectations and the EBITDA margin now stands between 16.3% and 17.8%. The previous figure was between 15.8% and 16.3%. And this revision I think shows that the group is really evolving very well from an operation perspective. It shows the strength of our pipeline and it shows that we are also very confident in terms of our execution capabilities in the second half of the fiscal year. So that means that we have much better prospects than what we established at the beginning of the year and we know that we're going to make even further progress. And with this, we're going to close the presentation and now we're going to open the floor for your questions. And we -- well, I forgot to mention, by the way, that we are going to present the Strategic Plan '27-'29 in the second half of the year towards the end of October or beginning of November. And now we'll move on to your questions and we'll be delighted to answer any questions you may have.

And we're going to start off with the Q&A session and we're going directly to the chat because we can't see anybody on the phone. And the first question comes from Aida Pereira from Economista. She's asking about extending our capabilities. What investments have you made in the year for the new plant and when was it commissioned? And how much has been spent on the ultra high-voltage laboratory? And how much is going to be spent in China and where is the plant going to be?

Well, I'll answer those questions. Well, let's see, the investment in Mungia has been about EUR 6 million between last year and this year. Could we see the question, please? Well, when did this start? Well, this started partially in the month of April and we can say that it's already working 100% now in July. As regards to the enlargement of the ultra high-voltage laboratory, well, what we've done is refurbished the machinery to work with DC and it's been EUR 2 million. It's been pretty complex too because we made the change whilst we were manufacturing. And finally, as regards to the factory in China, the factory in China is in Dalian I think you said, and it's just opposite the current factory. In other words, it's on the other side of the road. And it will be commissioned -- well, the structure has been finished and will be commissioned in the first quarter of next year and investments that we made in China is EUR 4 million or something like that. Well, we have a little bit more to go. But when we finish, it will be EUR 4 million to EUR 5 million roughly.

Perfect. Okay. Well, let's move to the next question and it's Robert Jackson from Banco Santander. And he's asking several things about the EBITDA margin in Brazil. So I'll read the question. When do you expect that the improvement of the mix in sales will have a bigger impact on the EBITDA margins? Because you said that this has to do because of improvement in efficiency. Costs have been affected by the geopolitical environment, logistic costs. Could you please talk about -- more about Brazil and when do you think that things will go back to normal? And the growth of contracts, is this being affected by some kind of bottleneck anywhere?

Well, look, there are many questions, but anyway. Let's talk about the sales mix. Well, it is already delivering positive results as regards margins. And I think that I explained this very clearly in the lecture in the presentation today. These improvements in margins, well, more than 50% of them have to do with internal efficiencies and that has to do with all the work that we've done in recent years. Although in this case, the sales mix has also had a positive effect and we think that this will continue in the future. So what we were explaining now, we were talking about the acquisition of a stake in Germany and it's a business with a good margin that should also support this mix so that it will be favorable. So we will see what happens in the next few months because it is an operation that is not affecting us at all in these June results. As regards costs, I'm not sure if this is a statement or if this is a question or if costs are being affected by geopolitical logistic issues. Well, yes, we are seeing, yes, that there has been an increase in costs and cost inflation effect and possibly this will affect us more in the next few months more than it has done until now because in this first half of the year, there's principally been no impact. But as we've also explained on previous occasions, I think that we've learned a lot from the past. And we know how to monitor all of these increases and we know how to try to reduce the impact as much as we possibly can by being agile. Yes, well, especially in terms of costs, what we have been affected by are the costs that have to do with metals, with copper, the cost of aluminum not because of transportation costs that have already been negotiated. But we had an inflation in raw materials, which is something that we didn't have last year and that didn't help us improve our margins. And this really has more to do then with the product mix and with efficiencies.

I can answer about Brazil now. In Brazil, we are very dependent on the framework agreements of the utilities dealing with reconnectors and this year, they are somewhat late. We've already signed a framework agreement this month. And our policy, as I explained, is that even though we have the contract signed is that we do not include that in the books until we receive detailed instructions from the customer on how many units they need and the lead times. And that's what we are working on. And what I can say is that the second half of the year is going to be better than the first half of the year without any doubt whatsoever. And then the final question. The final question that has to do with the growth of the -- if there are any bottlenecks. No, I'd say that there are no bottlenecks. In 2025, we did have a bottleneck in the case of certain product lines that were completely saturated and we couldn't cover all the demand. But this year in 2026 and with the investments that we made urgently last year plus a policy of transferring products to the different plants, I'd say that we don't really have a bottleneck in any of the production lines.

Okay. Let's move on to the next question. This is from Iniggo Recio from Gaesco and he's asking us about the results. He's congratulating us and he's talking about EBITDA margins. How come we had 18.4% in the first semester and a maximum margin of 17.8%. Do you think that it will be 20% in the next 2 or 3 years?

Well, thank you for the question. When you take a look at the snapshot of the first half of the year, well, we've spoken about some very specific snapshots of the product mix or the business mix and we've also had comparisons in different markets. But I think that what to do is compare this -- the improvement in the EBITDA margins with what was reported in December or according to the guidance. And what we can see is that with EBITDA margin and the profitability of the business, well, it is sustainable and we still have a way to go. There's plenty of room to move. And this year if we reach the high range, we would be exceeding -- we would be reaching a triple digit, which would be a milestone too for the company. And the figure of 20%, well, we'll see what the figures of the Strategic Plan have to say first. And we'll be presenting this information in the second half of the year. But what we can see is that the prospects are good, that the business is sustainable and the internal actions on efficiency and on the business mix, these measures are really contributing value and are also producing improvements.

Well, there's another question from Inigo. Is there going to be any M&A -- relevant M&A in the United States?

Well, we are still working on the growth axis that we have in the plan. And as I mentioned many times, well, we've made a very significant effort in terms of the geographic footprint both in the United States as well as in Asia. And this is one of our goals. And we can see that there are major disability and M&A has a very high level of profitability, but we're working on this in the United States is one of our targets.

Okay. Well, let's continue now with the questions from the telephone and we're going to give the floor to [ Antonio Pablo ] from Hota Capital, who's raised his hand.

Just 3 very quick questions. If I understood things correctly on Slide 9, it seems that grid automation is not growing in this semester. I'd like to know what's going on there. Could you please give us some more info -- more details, please, on the situation and what is expected in the future? And the second question has to do with CapEx. Could you please break down the figures and not only focus on the semester, well the CapEx that you expect for the total of the year? And how much would have to do with growth? And how much do you think it will contribute towards the sales? In other words, this new capacity that is being generated in the year? And finally, could you please give us some additional details on efficiency measures that are going to be maintained in the future, that's going to be implemented in the future?