Cementir Holding N.V. (CEM) Earnings Call Transcript & Summary

Good afternoon. This is the Chorus Call conference operator. Welcome, and thank you for joining the Cementir Preliminary results for 2025 and 2026-2028 Industrial Plan Update. [Operator Instructions] At this time, I would like to turn the conference over to Marco Maria Bianconi, Chief M&A and IR Officer. Please go ahead, sir.

Thank you. Good evening, everybody, and welcome to Cementir Holding 2025 Results Presentation and their industrial plan updates. This is Marco Bianconi speaking. I'm here, with our Chairman and Chief Executive, Francesco Caltagirone.

Good afternoon.

Who is happy to take your questions at the end of my short presentation. So going to the presentation deck on Page 5. We have highlights of the preliminary results 2025. Revenue reached EUR 1.639 billion, minus 2.8% year-on-year. Non-GAAP revenue was flat at $1.644 billion. There was a EUR 97 million negative impact from currency depreciation, mainly Turkish lira versus the euro. Cement volumes were up by 3.1% in Turkey, in particular, but also Egypt, Asia Pacific. And some volume reductions in Nordic and Baltic and Belgium. Ready-mix volumes were down by 4.8% due to negative performance in Turkey, Denmark and Belgium, whereas aggregate volumes were up 3.4%. EBITDA reached EUR 439.5 million, up almost 8% year-on-year. Non-GAAP EBITDA was EUR 460.2 million, up 15.3% year-on-year. This figure includes EUR 52 million of net nonrecurring gains, of which the major items are EUR 36 million capital gain from disposal and EUR 19.7 million of insurance proceeds for the fire at Gaurain plant in Belgium. 2024 figures include also 4.4 million charges nonrecurring. Non-GAAP EBITDA, excluding both nonrecurring items, was EUR 408.2 million, up 1.1%. Also on EBITDA, there was almost a EUR 21 million negative FX impact due to translation mainly from Turkish lira into euro. Profit before tax was EUR 286.3 million, up 0.5% non-GAAP profit before tax, EUR 325 million, up 10%. Net cash position at the end of the year was EUR 465.1 million, an improvement of EUR 174.6 million year-on-year, including $43.5 million of dividends by the parent company, EUR 9 million of dividends to third parties and EUR 51 million proceeds from the disposals of Kars Cement. On Page 6, you can find our 2026 guidance. We expect for this year revenue up around 5% to EUR 1.7 billion on a pro forma basis, excluding the contribution of Kars Cement, which was sold on December 1, 2025. We also expect an EBITDA progression between 0% and 5% to a range between EUR 400 million and EUR 420 million for the year and a net cash position at year-end up by EUR 125 million to EUR 590 million. This is after CapEx of around EUR 128 million. This guidance refers to like-for-like ongoing operations, non-GAAP and excluding any extraordinary items. And please bear in mind that the starting figure is pro forma and its restated excluding the contribution of Kars Cement, which was sold on December 1, 2025. Now moving to the industrial plan updates. Quickly on Page 8. The 5 strategic pillars are unchanged. Just one highlight about sustainability. We continue to implement our CCS project in Denmark. We are investing in value chain circularity and a number of renewable energy projects. As far as competitiveness, we are streamlining and standardizing all group processes. In terms of innovation, we are outlying artificial intelligence to business processes, and we are working on widening our portfolio by including an increasing number of low-carbon cement and other value-added solutions. As far as growth and positioning, we want to keep reinforcing our vertical integrated model in the three key countries -- regions, Nordics, Belgium and Turkey. And we want to keep our global white cement leadership, and we want to be opportunistic on M&A if and when the opportunity arises. We also are investing on our trading business and investing for further development there. As far as people and safety, we are implementing a zero accident program, fostering a high-performance culture focused on safety, and we are attracting talent, focusing on sustainability and innovation. Moving to Page 9, just a few highlights regarding the key themes and trends in our industry, which we are addressing in our industrial plan, the first being climate change and decarbonization. There is a trend towards more stringent CO2 and new building regulations across Europe for sure for a number of countries. There are a number of technological solutions for net zero like CCS, which we are implementing, and there is increasing demand for low carbon products, which we are addressing through our FUTURECEM and D=Carb product ranges. As far as urbanization and infrastructure gap, we see this trend of population growth and urban migration. There is an increased public private infrastructure spending. Therefore, we believe there is significant pent-up demand for our products. As far as resource efficiency and circular economy, we are clearly fighting the rising energy and raw material costs. We are increasingly using alternative fuels and recycled materials, and we are embracing circularity in every aspect. The last one being innovation, digitalization and efficiency. We believe that there is a trend towards new and more efficient building methods, and that's clearly a trend towards reduced content of clinker into cement and reduced content of cement in concrete. Moving to Page 10. These are our Scope 1 emissions 2030 decarbonization targets. As you can see, we are targeting a 42% reduction in gray cement emissions per ton of cement equivalent versus the 2020 baseline. And this is an objective that is beyond the taxonomy level. As far as white cement, the reduction is 20% versus 2020, and again, you can see the reduction in 2030 to 730 kilograms per tonne of cement equivalent. Turning page to 11. We have the actual projects live. Just to provide you some more information regarding this project. As you know, this is a pioneering project, one of the largest onshore systems multi-stream in Europe, meaning that it's processing emissions for both white and gray cement through a single operating unit. And thanks to this proprietary innovative technology, Air Liquide, our technology partner will capture, purify, liquefy approximately 95% of the CO2 emitted by the cement kilns. This project targets 1.5 million tons of CO2 to be captured annually. We have been awarded EUR 220 million grant by the European Innovation Fund. And we expect this project to be operational from 2030 according to the timing of the new logistic infrastructure, which depends on third-party responsibility. Moving on to the awards on Page 12. As you can see, we had a continued ESG commitment. We have been awarded during 2025 with a number of recognitions CDP included Cementir in the A list for the second time. We have been awarded by Statista and Financial Times, one -- we've been appointed as one of Europe's climate leaders. And in June 25, Cementir was also included in the TIME ranking of the world's 500 most sustainable companies. And you can see underneath the table where you can see the progression in the rating from main agencies on our company. On Page 13, just a flash regarding innovation. We continue to invest in transition towards lower carbon products. We have solution for low carbon cement and solutions for low-carbon concrete. In the low-carbon cements, we are adopting the FUTURECEM technology, which saves up to 30% of CO2. And clearly, there is a progressive shift to blended cement with lower carbon footprints in all regions, leveraging on additional SCM materials and limestone. There is a global expansion of the D-Carb white cement family, which is reducing emissions by around 15%, and we're providing transparency and credibility on this product through an EPD declaration showing environmental footprint and life cycle impact. As far as concrete is concerned, we are promoting sustainable ready mix concrete through circularity and low-carbon cement. We have a new low-carbon range in Denmark, Norway called [ Universal ]. We're also launching C-Green range in Belgium and France, and we also are extensively using low carbon concrete in Turkey, where we are front runners. A few slides regarding the financials on the industrial plan. On Slide 15, you can see the main highlights. These figures exclude the intensification of geopolitical tension and any extraordinary event, of course. And you can see that the revenue we're targeting is EUR 1.95 billion by 2028, which implies a compounded annual growth rate of 6% to 7% from the base pro forma of EUR 1.6 billion. Again, the pro forma is calculated by excluding the contribution of Kars Cement, which was sold on December 1, 2025. As far as EBITDA, we are targeting a 4.7% compounded EBITDA growth in the three years, which will lead us to target EUR 460 million of EBITDA with an EBITDA margin of around 23.6%. The net cash position is clearly on the same perimeter is going to grow by EUR 330 million from EUR 465 million to around EUR 800 million by 2028 year-end. Just the last couple of slides, on Page 16, a few details about the targets. As I mentioned, the revenue compounded growth rate in the period is based on a moderate increase in cement volumes in the main geographies, namely Nordic and Baltic, where we expect residential construction improvement from 2027, a higher export volume from Egypt, where both operating lines will be running and an improved trading in Belgium, China and Malaysia, partly offset by lower volumes in Turkey in 2026, both because of the disposal of Kars Cement and also for trading reasons. Volumes compounded growth of 2% to 3% for cement and 1% for both RFC and aggregates. We expect prices to be generally in line with local inflation, particularly in Turkey, reflecting higher energy, raw material, CO2 costs. As far as EBITDA, we've already touched upon the growth, which we expect in every region with the exception of Turkey. We also note the increase that we expect in raw material cost, electricity and certain fuels. And there will be some negative impact from currency volatility, namely Turkish Lira and Egyptian pound. We are, on average, short 130,000 tons of CO2, including a step-up in 2027 due to lower free allowances at our European plants. The margin will be mean reverting slightly to what we think is a long-term average. The maintenance and expansion CapEx is within the industry norms between 5% and 6% around EUR 129 million per year with a cumulative CapEx of EUR 386 million of which EUR 77 million for sustainability initiatives, including EUR 16 million for the ACCSION project in 2026. Please bear in mind that ACCSION net CapEx group share from 2027 will be around EUR 120 million in the following three years. The profile of net cash out will depend on the timing of the logistic infrastructure execution which is third-party responsibility. Please note also lastly, that cumulative free cash flow generation will be around EUR 330 million with a progressive dividend payment in the range between 20% and 25%. This leads me to the last slide, which is the CapEx highlights. As I said, EUR 386 million cumulative investment, of which EUR 77 million sustainability and EUR 16 million for CCS. The main projects are ACCSION in Denmark, wind turbines in Belgium, facility upgrades for FUTURECEM natural gas transition in Aalborg and Gaurain. This ends my presentation, and I leave the floor to Mr. Caltagirone, who is happy to take your questions. Thank you very much.

[Operator Instructions] The first question is from Wim Hoste of KBC Securities.

Yes. I would have three questions, please. The first one is on the CBAM regulation. Is that having any impact on your businesses and markets? And can you maybe comment on that? The second question would be on Egypt. You opened a second line last year. Can you explain us how that is driving growth in that market and also what the profitability impact of that growth? I think you mentioned in the industrial plan that you see a pickup in volumes in Egypt. So a bit of more clarity or granularity on that would also be helpful. And then a third question from my side would be on M&A. In the industrial plan slide or [indiscernible] there is also mentioning that M&A is still a possibility. I think in the past, you were a bit cautious to do M&A, looking at all the regulatory changes on the environment, et cetera. Is that attitude now changing? Or are you still maintaining an organic growth for the short term? Those are the questions.

Thank you for your question. The first one about CBAM. So far, frankly speaking, we haven't seen a lot, especially because in the northern country and Northern Europe, the weather has been so bad that especially, as you can imagine, during the last part of the year and in the first part, you use the inventory that has been built in the previous quarter. So now I think from the moment that the weather, the bad weather were hit the business between 10% and 20%. It is difficult to evaluate if CBAM in place have, let me say, helped or not the business. So we need a few weeks or a couple of months probably the first half of the year to understand better how it is working. In Egypt, we expect that this year, the problem that we suffered last year for qualities has already been resolved. And we expect that we increase our sales, especially to the United States. The El Arish port is already working for the first time. We sent a vessel of 35,000 tons directly to the states. And so we expect to increase the profitability of the Egypt that nearly 50%, 60% this year should be around EUR 18 million of EBITDA. Regarding M&A, we have the same, let me say, attitude, we would like to expand our business and perimeter. I know that especially in the latest weeks, there has been rumors about, let me say, possible change and enhancement of the CO2 framework. This framework has been built in the last 20 years. I don't think that in a few months or weeks can be, let me say, amended or changed probably. I think that because I expect more questions on this, let me say, item that Europe realized that has a competitive gap on, for sure, electric vehicles against China. And we have seen Stellantis what have done a few days ago in terms of write-off. And the competitors from Eastern Asia are heating up their market, especially now in Germany, and they are suffering. The second thing, second issue is about the energy production. You know that in the last few years, most of -- a lot of coal-fired plant has been, let me say, announced the phase out. I think that the world and especially Europe and United States will need more energy. So there will be more addition. The issues today, I don't think is that to swap back from, let me say, green emission to let me say, gray emission is that probably we need more energy. And in a short period of time, more energy can come only from coal fire plant. And this will increase the emisson. So probably a release on certain level of, let me say, quarters can help more energy production. I don't think, frankly speaking, that after you as for the billions and millions in grants, especially in cement and steel will now revert is, let me say, attitude. And even if the phaseout of certain, let me say, critical threshold in CO2 emission will not, let me say, change the attitude that in this sector, I can say that especially from the biggest or bigger competitor, is quite constructive because we are starting to implement, let me say, the technology to produce green cement probably in the next [ five ] years. But today, except as you all know, a small plant in Norwegia owned by Heidelberg. In the next 5 years, no one will produce low-carbon cement. So I don't know how this can, let me say, affect the, let me say, the system or the balance sheet of the cement player in the next 5 years. Then if we will have more, let me say, probably in the Phase II, I mean, after 2035 to 2050 to have, let me say, a more comfortable, let me say, path to arrive to zero cement, probably this can help. But now I don't think, but this is my personal attitude that, let me say, they will -- they want to stop, to slow down because compared to United States, for example, as you know, 90%, or more or less 90% of the cement in the United States is owned by European players. And they can transfer the technology from Europe to United States. That is the only, I think, a way because usually, we take the technology from the United States, and we bring to Europe. I don't think that the cement sector that today is that the edge of this technical shift should, let me say, stop or Europe should push to stop. But let's say, we are at the very beginning. They have started to talk about announcement of the framework, but probably we have to wait June or July to understand which will be, let me say, the future framework for CO2 emission [ for us ].

The next question is from Matteo Bonizzoni of Kepler Cheuvreux.

Yes. I have some questions. The first one is rating on ACCSION. What you're writing in your press release on ACCSION is that in 2026, you will expend EUR 60 million of CapEx. But the sum in terms of CapEx has increased from EUR 100 million to [ EUR 100 million ], now you're guiding, if I'm right, EUR 90 million to EUR 100 million, now it has become EUR 120 million. And above all, you are also saying that the 2027-28 CapEx figure are not including ACCSION because you are waiting these, let's say, higher visibility or details on the third-party public and private entities CapEx for the logistics and storage and so on. So what is at stake here? You have not put the CapEx because you don't know the timing? You have not put the CapEx because you don't know exactly if they will fulfill these investments? Help us understand what is at stake here in terms of your decision not to put this CapEx in your CapEx plan? Then regulation on CO2, second question. You have partly answered it. Clearly, it's a hot topic now because the market is reasoning about the potential impact of this revision, which so far has been just leaked by press sources, by the way. And -- so I would say this relates -- the phase out of reallocation, which could be postponed, this relates to cap and other technicalities. So my question is in case this revision is going to prove true, would you enter a sort of -- wait and see and standby stance on your decarbonization project or absolutely not? You are, in any case, committed to go ahead according to your previous plan? Third premium is a third question, if I may, is price premium for green cement. There is a debate in the market. You have just said that currently only either materially selling a small quantity compared to the overall market of Green cement. So how can we [indiscernible] that the green cement will enjoy a good pricing premium or not in a mass market situation because there are various versions here. Somebody is saying that, "Absolutely, this is very unlikely", okay, that the market will be ready to pay a decent premium, okay, or a big premium and other sources, which, for example, either materials clearly are more constructive. How big part of the equation of the return is price premium or not? What's your view? So I mean it's very early days. So I think it's very difficult to provide an answer to this, but maybe you have a view. Last is Belgium, if I may. Where we are on the European grant? So I am understanding that you could achieve a grant in Belgium, maybe this year or next year. And also, given that it's not a costal plant differently from Aalborg and is also smaller, a slightly smaller plant. In terms of return, cost to do the carbon capture and storage, how it differs from Aalborg?

So let's start with that. First, ACCSION projects. So we wanted to put them in what is already approved by our Board ask for, let me say, investment. And for sure, we have put this around EUR 70 million because the electric line and transformer that will allow the plant to ask for more energy after the CCS implementation. Regarding the remaining EUR 120 million because as you can imagine, this is a new technology. We are talking about contracts that, let me say, will -- or contractor that we supply material 4 or 5 years. And so there is also their view in inflation. And you know that especially the metals part of raw materials are increasing. So our, let me say, forecast of EUR 100 million, we have rounded to EUR 120 million. I think it's a minor adjustment. And we are going to put this EUR 120 million, that is roughly EUR 30 million per year for 3 or 4 years, depending on when we will have the complete, let me say, scenario or when we will be aware of the whole scenario because besides our investment in the plant together with Air Liquide, we need to have the connection with the pipeline that is built by a public company, [indiscernible]. And then we also -- we need final certification of the storage area. And this will arrive between the first half of 2026 and the first half of 2027. So if there are delays, I think we need to postpone this EUR 120 million of investment. So for this reason, we haven't put so far. We just, let me say, underline that the costs are there, but we think that probably, frankly speaking, because if we will have to wait the half of 2027, we will start to spend in 2028 as earlier. So in the last year of this industrial plan. And as you can imagine, I don't think that we are going to spend all the EUR 120 million in one year. So this is the reason why we prefer to have this kind of approach. The second question is about the green cement. I mean, today, as I say, there is no green cement availability except for a small quantity because even in Norway, they are in a ramp up. So the plant is, let me say, the plant should produce 400,000 tons of green cement today combined earning, we are around half because there is a ramp-up, and this is usual. So today, there is no premium price. And probably, we are already asked by the Norwegian government to buy because we produce, as you know, ready-mix in Norway, and we buy cement, and they are, let me say, oblige the customer to use the cement, especially for public works. So we will buy some smooth quantities of these green cement made by Heidelberg in Norway. But let's say, I think that in the next 5 years, this kind of, let me say, mandatory usage of this cement should be, let me say, enlarged, especially in the Nordic country because most of the green cement production will be expected. So I am aware because I had recently direct talk with the Danish government that especially after the Greenland issue with the United States, they are not, let me say, they don't want, let me say, to change their approach, especially for this green deal because somebody in U.S. is telling exactly the opposite. So I don't know -- I am, let me say, an interpreter but let's say, I am -- just 10 days ago, I could, let me say, realize that there is a strong willingness to go forward. And also, we have applied for the Danish fund that should supply another tranche of grant for this project, but we will be aware of the final result of this after Easter. So when we will have the grant? We already have received the grant from the European Union. As I say, the execution risk for this project should be very limited considering also that we are the only producer in them. So I don't think that other, let me say, other players that can continue to sell cement, let me say, that won't be greener, let me say. On [ CDP ], the project is more or less the same. The only difference is that in Belgium, there is not on offshore storage. Today, the design of the project consider that we ship the CO2 by pipeline that has to be built to the port of -- one port in Belgium and then transfer by ship to the Aalborg port then injected in the same storage area of Aalborg. For sure, I expect that before -- because we have, let me say, up to last nearly two years of delay compared to Aalborg that the price should be lower and even the size. We have applied for a grant for Belgium last year. We were, let me say qualified, but they didn't have, let me say, enough fund. So we expect -- we don't have to submit another time. We just need that -- they refinance, let me say, and they should refinance for our sector or for other sector this year. So we expect that this year, probably October, November, we should have, let me say, some news. I don't know if I missed some questions.

Just a short one. What is the fee which you're going to pay to Air Liquide? Because Air Liquide is going to do most of the CapEx, no? I mean I don't want to know EUR 1 million but I think they are doing most of the CapEx, so they will want to be remunerated, no? Can you confirm that?

Yes. I cannot say this now because it also depends on the time frame they can have, as usual, as you can imagine, every kind of project a sort of premium if they go faster, if they -- because the technology is provided by them. It's not provided by us. So there is also a sort of level of satisfaction between, I don't know, I can't say between the 90% of capture and 100%. So it depends when we will land at the end with a real capture of CO2 between 90% and 100%. So frankly speaking is it's early now, we all -- it also depends because the grants that we should receive from the Danish government should help to, let me say, build the right, let me say, cost formula for this cement.

The next question is from Alessandro Tortora, Mediobanca.

Yes, good evening to everybody. I have three questions, let's say. The first one is just a follow-up on the ACCSION project. Just want to understand that. So you mentioned the possibility to get this fund. Is it something that is going to help on the CapEx or on the OpEx side of the ACCSION project? This is the first question. The second question is on, let's say, the Turkey outlook. So if I understood well, I know you mentioned several reasons on top of the change perimeter why Turkey is going to have a negative contribution in EBITDA in 2026. Can you give us an idea of what are, let's say, the moving parts, considering that the low end of your EBITDA guidance is basically assuming zero growth? So which kind, let's say, of outlook do you see because you also mentioned this post earthquake demand that is going to normalize in Turkey this year. So this is the second question. And the third one is just a comment on, let's say, these steep decline in CO2 prices we saw over the last month. Let's say, maybe this is change into CO2 prices this decline may change your commercial approach this year from a pricing standpoint or let's say your price leasing in a certain way pegged a little bit to CO2 prices. So just to understand how you're going to manage this change into the CO2 price outlook.

The Danish fund is a fund that will supply us, let me say, a balancing from higher energy cost and will be on OpEx and will last the 15 years starting 2030. So it will last until 2045 and should contribute to lower and balance the extra growth for energy. But today, we don't know how much will be because we will know in April. The second question is about this year forecast. As I said, the perimeter is a bit -- very -- a bit changed with just a matter of 1.5%. We have to take -- we were slightly positive in November when we built this industrial plan but today, after 6 weeks of a very harsh winter is difficult to expect that, let's say, we can, let's say, do better because, let's say, we expect that until the end of February, there will be, let me say, a lower output in Scandinavia, in Turkey, and partly also in Northern Europe, but this has affected the old market. For sure, this will be -- will come at a couple of months, this is the worst winter in the last 15 years in the Nordics. Starting your last question, the planning of the CO2 price that this is, I think, is not affecting because, let's say, we pass the cost as it is on a monthly basis, on an average to the customer. So if it increase, the price we'll increase, if it will decrease, we will decrease. So it's like VAT, right? So something that we collect, and we give back.

Okay. And sorry, and this is something, let's say, this is revision or like a monthly revision you do? Or if you can, let's say, something you trigger? Just to understand because as I said again...

No, there is -- we charge the customer with the formula on a monthly basis.

Okay. And sorry, is this formula used, let's say, in all your countries? Or we are referring, I don't know, to all the countries, I would say, except for Turkey? Just to understand the perimeter of this formula.

We [ charge ] this in the country where, let me say, in France, Belgium and Scandinavia, yes, we use this formula. But this is, I think, is the most widespread formula used by also other competitors. Nobody wants to hedge or to leverage on CO2. I mean, it's a tax [indiscernible].

The next question is from Egor Sonin of AlphaValue.

Good morning, everyone. Thank you for picking my questions. For 2026 until 2028, you plan to assume higher raw material, electricity, and fuel cost. Is it possible to provide EBITDA sensitivity to change in energy and raw material costs or at least some color, sort of, how we could think about it? Like what will be the most costly raw materials? What will be the most expensive higher cost which we can foresee in our estimations?

Let's say that in our forecast, we put, let me say, an increase, but we are hedged at 75% in the energy, both pet, coke and gas and also in coal. So -- and the electricity , sorry. We are, let me say, covered in full mostly this year. And as I said, the nearly 75%, '27 and '28. So let's say that if the price increases, probably we won't suffer anything meaningful. And the same, if the price will be lower, our cost structure will remain flat. So this is when you hedge. So we don't expect, but most of this uncertainty mainly is the exchange rate against dollar because you pay pet, coke with dollars. And also in electricity, it seems that the peak of 2022 now has been, let me say, fully digested and the price sure -- I mean, for the next two or three. Let's say that today, some suppliers are even open to make contracts that can last 10 or 15 years flat as you can, let me say. So I don't think that cost inflation should hamper our industrial plan, frankly speaking.

The next question is from Bruno Permutti of Banca IMI.

I wanted to ask something about the guidance you gave of 6%, 7% revenue CAGR for 2006, 2028. So I -- on the recovery that you expect in the Nordic and Baltic from 2027, is there something specific that you are thinking of in terms of infrastructure projects that will accelerate in that period? So if you can elaborate a little bit on that. And as for Turkey. Beyond 2026, what is the outlook you have in mind? You believe that there would be an increase in demand from also for export from Turkey and that this could create some opportunity also for the domestic market? It is a realistic option? And lastly, on the prices, if -- what is the outlook you see in the short term for 2026 if you see some pressure somewhere?

Starting from -- let me say, the last one, the only place where today, we see some mild price pressure just in China because of the economic environment. But let's say, we are in white cement and usually, let me say this is not so, let me say [indiscernible] but on the other geographies, it seems that the framework is constructive. I mean, stable with a mild income. Turkey after 2026, as you can imagine, Turkey is the first, I mean, supplier of the Mediterranean area. And as we have already shared with you a few times, it's the first candidate to supply construction in Ukraine, it already started in Syria and partly in Gaza Strip. For sure, we are in the latest stages of, let me say, that the earthquake reconstruction and it's difficult to have an agenda on what will happen in Ukraine and what will happen even in Iran because Iran is a neighbor, so we don't know the outcome there. But also Syria is the only country that is really, let me say, start to have an inflow of Turkish cement and also on Gaza Strip, you are aware that the talks are open and we don't also -- it's difficult today to say that we might see -- we haven't considered in our industrial plan, we are conservative, but we think that this, let me say, should build up in the next years, for sure. And Turkey is, let me say, the only candidate because of this capacity and it's surrounded by, I mean, this bigger possibility to export cement. In Nordic and Baltic. I mean, mainly, let me say, in the last three years, like most players, I mean, from France to Nordics, we have experienced, let me say, lower volume especially macro reason. So we expect because the rates are lower and we decide now that for sure, I think, as I say, the first quarter and the first half will be hit by the, let me say, atmospheric issues that the demand should, let me say, broaden. So there are no particular -- one reason also because this year, I mean, we are expecting, let me say, flat EBITDA compared to last year is because, let me say, the Fehmarn project is -- the delay on the project is growing probably now, I mean because it's the Danish government, they expect a 2-year delay, that is not 2-years from the start, but let me say that these projects are developing slowly. So we have lowered, for this year, nearly 30%, 40% of the quantity that will go to this project. But for sure then, we will have another two years more at the end. So these are, let me say, our expectations, but the -- are mainly in the macro environment, the increasing in quantities.

The next question is from Carlo Maritano of Intermonte.

I just have one question on the net cash guidance for 2028. So if I start from your expectation from 2026, it seems that there is only EUR 100 million per year of cash generation in the later years in your business plan. So I was wondering what is driving this cautiousness? And if this target includes the CapEx that is not included in the other slides? So just to understand what are the building blocks of this guidance?

Yes, Carlo. In fact, the cumulative cash flow, we are expecting EUR 330 million in three years. So it's about EUR 110 million of free cash flow per year. Please bear in mind that this is after the payment of a progressive dividend, which we expect to grow in line with the earnings, with a dividend payout ratio of 20% to 25%. So these are clearly -- I mean, it's not particularly conservative. I think it's a realistic scenario. And I think it's broadly in line with the historical general cash generation of the company is north of EUR 100 million a year. And it clearly includes the expected CapEx that we earmarked in the slides, which is EUR 309 million of maintenance CapEx and EUR 77 million of sustainability CapEx cumulative in the '26, '28 period.

Gentlemen, there are no more questions registered at this time.

Okay. So thank you very much for your interest in Cementir Holding, and we wish you a pleasant rest of your day. Thank you.

Good evening. Bye-bye.

Ladies and Gentlemen, the conference is now over. You may disconnect your telephones.