Esprinet S.p.A. (PRT) Earnings Call Transcript & Summary

Good morning, everyone and thank you for joining us for the Esprinet Group Fiscal Year 2025 Results Presentation. I'm Giulia Perfetti, Investor Relations and Sustainability Manager of Esprinet. And here with me is Alessandro Cattani, CEO of the group, who today, together with Giovanni Testa, our Chief Operating Officer, will comment on the results. Today's call is being recorded and the podcast will be posted on the Esprinet website in the Investors section together with the presentation. [Operator Instructions] Please note again that this presentation contains forward-looking statements. So I would like to draw your attention to the regulation note on Page 2 regarding the information contained within this document. I will now pass the call over to Alessandro to begin presenting and commenting with you on the fiscal year 2025 results. Alessandro, over to you.

Thank you, and welcome, everybody. It's quite an important moment for me and to a certain extent for the company and definitely for Giovanni Testa as well. We -- for me, as you know, it's the last investor call as I will be stepping down from my position effective April 2023 (sic) [ 2026 ]. So Giulia, if you could please move to the slides over to the first slide. We will dig into the, let's say, the reasons of this change, and we will have Giovanni introduce himself more in a couple of slides. But let me first give you an highlight on the industry insights, what happened in 2025 as well as what we did in 2025. So as you well know, the global economy, despite an initial scenario which had a lot of tensions performed better than expected last year. There's been quite a lot of investments, even too much, I would say, in the artificial intelligence segment, and we'll come to this in a moment. And this was reflected in a very robust ICT spending in the EMEA region. Again, the ICT spending exceeded the GDP. And in the regions, in the countries where we operate, Southern Europe, now we have an exposure also to Netherlands and to Ireland. But the bulk of our business is performed in Italy, Spain and Portugal. We have witnessed an ICT spending in these regions with a growth of 6%. And this has confirmed once more the important role of technology within the changes in the overall performance of the economy as a whole. The huge investments in artificial intelligence. This activity, coupled with the refresh of the devices, which happened last year and it's still going on in this moment and is the result to a large extent of the huge investments made during the COVID period, which happened 5 years before. This coupled with the growing use of cloud on one side and the growing threats linked to cyber attacks and therefore, a huge investment in cybersecurity gave and are giving a really, really healthy outlook to our sector. We're coupling this with the energy transition, which probably the latest geopolitical events in the Gulf will, we expect, accelerate furthermore the transition itself. And hence, we're really excited of our move through Zeliatech into this energy business. The Overall, ICT market grew 6%. We had the distribution channel where we operate, performing, again, in a very good shape, much, much stronger the performance in Spain and Portugal than the one in Italy, but Giovanni will dig into the numbers in a second. What's important is that the go-to-market represented by distributors and Esprinet is one of them, grew once more, and it's now the weight of this go-to-market is now around 48%. So healthy performance in this sense. Now moving to the next slide, we're going into the highlights of what we did last year. First, the sales have been pretty solid. We had 5% year-on-year gross sales growth up to EUR 4.6 billion. I recall that the numbers that we report are net of the IFRS 15 principal agent principal accounting principle, there's more than EUR 300 million of gross sales that are not reported as sales and just as gross profit. So gross sales were up 5%, and we had an extremely brilliant performance in the Iberian Peninsula, and Italy was substantially flat in line with the performance of the market. We have been focused, as you well know, in the higher added value markets of V-Valley, so digital solutions on one side and services and Zeliatech, so green transition. And we have outperformed the market at a large extent. Pretty happy that our focus on these areas has delivered as expected, and frankly speaking, a little bit more than what we expected. We had a very positive performance on PCs as well. The remaining products, mostly consumer electronics as well as printers and accessories, recorded once more some decline, most of it linked to our decisions to progressively shed those kind of businesses that we deem as not profitable enough or not providing return on capital employed good enough for us. In terms of profitability, we had a range of EBITDA adjusted, and we delivered on the upper range of our guidance. We had a good Q4 but slightly less than expected, mostly linked to a less than expected performance in additional rebates in the Zeliatech business, but we'll dig into it in a moment. Gross profit margin is now solidly above 5.5%. And about a very challenging start of the year in terms of operating costs, we then during the year had a very, very controlled performance. You will see in a moment, during the quarter, G&A were up just 1% compared to previous year. So really solid performance in this. Cash conversion cycle closed at 26 days. We're still short of the, let's say, ambition of running at 20, 21 days, which means for us being cash neutral. Net financial position including [ EUR 16.4 million- EUR 3.8 million ] way positive if we look at the bank position. Return on capital employed was down at 6.1%, negatively affected by the EBIT performance, which was affected by the fact that we have a higher weight now of depreciation linked to the investments we made in Italy a couple of years ago on a new warehouse. Luckily, we are working hard on reaping the results of having worked on improvement in the levels of working capital. And therefore, we are expecting to be able to close one smaller warehouse during the course of this year in Italy, hence, bringing an improvement in this area as well. We had a higher-than-expected tax phenomena and one namely a write-off of deferred tax assets on our Portuguese business, not lost simply from a cautious standpoint, we decided to write off deferred tax assets. And as long as we are seeing a very nice turnaround in our Portuguese business, we expect to recover part of them in the future years. But that impacted our net result because of the tax rate whilst the pretax numbers were significantly growing. And we have proposed once more a very healthy dividend of roughly of EUR 0.35 per share, which brings the total amount paid since going public to more than EUR 220 million out of north of EUR 520 million of net profit generated in this 25 years being listed. So pretty solid performance here. And in terms of our value strategy, well, we kept executing on our 3 strategies: V-Valley, our key player in digital transformation, cloud, cybersecurity, and we outgrew the market, and we consolidated our presence in different segments. The green transition with Zeliatech phenomenal growth, and we keep our -- we are experiencing even higher growth in this moment. So we're really positive about the future outlook of this business. We have Vamat in Benelux, which we acquired after a very long process. We consolidated it in the last quarter of last year, but we expect a lot of potential contribution out of Vamat. Giovanni might dig a little bit more into this. And lastly, in Esprinet we had positive results, especially driven by the PC replacement cycle. And we kept experiencing good demand from businesses and consumers. Okay. Giulia, if we move to the following slide, I would hand over to Giovanni. Giovanni, then we will have more on this. Giovanni has been serving in the company since 2001 when he joined the company. Since 2016 he has been in the management team of the group and since 2020 he has worked as Chief Operating Officer. We have shared the strategy planning and execution. And so more and more, we are in a position to have the man really in the driving seat of day-to-day operations today with us as he did in November to explain us what happened last year, and then we will discuss again on the outlook for the future. Giovanni, over to you.

Thank you, Alex, and good morning to everybody. Well, here, we show you the group performance in Q4 and in the full year 2025 under the point of view of the country or the product category and the cluster of customers. As you can see, for the full year results for Italy, we are flat for the growth of the sales and also in line of the market, because also the market show a performance of 0 growth. In Spain, in Q4 and also the full year '25, we grew a lot with more than 10% in the full year and 12% in line with the global market, as Alex said a few minutes ago, the Peninsula -- Iberian Peninsula had a very good performance in 2025. In Portugal, we are growing a lot more than the market, both in Q4 and also the full year. The turnover is increasing a lot and also the turnaround that we started in 2024, also with the changes of some management with the appointment of a new country manager is giving us a very good result, and we are doubling the growth of the market in Q4 and for the growth of the full year '24. If we see the product categories, what Alex explained again a few minutes ago is well represented in these slides. Our strategy to have the maximum focus on solution services and the green tech spaces is giving the right success that was expected in our mind, but that you can see also in the figures. The devices are losing sales in this moment as related more or less everything to consumer products, TV overall over the other product categories. Screens, we see a very good performance for that product category, fully aligned with the growth of the market, 6% in Q4, 5% full year and is connected to the change of the release of Windows from Windows 10 to Windows 11 and is a good effect we're seeing also in the first month of 2026. But I would like to underline more that in Solutions & Services, we show you a growth of 12% in Q4 for the Green Tech 43% that are combined more than the growth of the market that was 13% for the Q4. And also for the full year, we can say that the big results, because for our point of view is a big result of the solution services and Green Tech show you a performance over the market. We have overperformed in the market. About customers, probably you know perfectly that overall in Italy, the retailers -- the retailers market is not so wonderful. The market is in Q4 was flat and in the full year was 4% growth. We are in the full year flat as Alex said, also because we decided not to compete in some business that under our point of view are destroying value, and we are not decided not to follow the turnover, but to follow the EBITDA and the control of the working capital. So we prefer some turnovers. On the contrary for the IT reseller for Q4, we have a growth of 8%, more or less the same 7% for the full year, aligned to the market growth that was 8%. In the next slide, we see the revenues and the EBITDA at the absolute value and the EBITDA in percentage of Q4 and of the full year 2025. What we can underline in this slide, the very good performance, as we said, the solution services, the EBITDA margin of the Esprinet total screen plus devices grew EUR 3.5 million of 21% and the EBITDA margin percentage passed from 1.56% to 1.90% is mainly related to the performance of the screen. About Solutions & Services, the growth of the EBITDA in Q4 is in percentage -- sorry, in absolute value is -- we are decreasing, as we said before, is connected to extra contribution that we before is in our hope will be the same in the future because it's connected with the M&A deal that we did in October '24, '25 with the M&A of Vamat acquisition of Vamat that was in the Zeliatech space, the company that is working in Benelux and Ireland. Vamat is specific skills that we want to transfer to the Zeliatech space in Italy. And these specific skills can guarantee from our main vendors overall, our main vendor that is Huawei Solar, a stable extra contribution that in 2025 was not. One of our target of the -- one of our main reason of the deal the M&A deal is that. About full year '25 versus the full year '24, we see in the total of growth of 4% of the sales, EUR 150 million with a stable EBITDA margin around EUR 69 million -- [ EUR 69.7 million ] against EUR 69.5 million. We are a pleased to underline that is fully aligned of the -- again with the guidance that we announced in May '25, we confirm in September and November '25 and we were consistent with our -- what we said.

If only we had this extra contribution.

Yes. Also without extra contribution. On the contrary, we could have an extra performance also about EBITDA. In the next slide, we show the Q4 and the full year '25 profit and loss summary. A lot is already said comments to the slide before. If we see the Q4, the growth of the sales was 3%, the gross profit was flat in absolute value. We -- you will see a growth of the SG&A of only 1% against the -- again, if you remind the performance of Q1 in which we had a of a lot of EUR 1 million of cost with a percentage very higher after that also because was inserted some cost related to M&A acquisition of Vamat. After that, our philosophy, our strategy of cost under control will apply in a very well more at the end of quarter four. Before was a decrease of SG&A was only 1% that is less of the inflation rate. About EBITDA, as we said, is flat in the full year. And in the Q4, the decrease is another time connected to the extra contribution of Zeliatech that we said before. About the net financial expenses in the full year, you see a flat result, EUR 10.8 million of other financial expenses against, again, versus EUR 10.7 million of 2024. The result of Q4 is related to a higher average working capital that we see next slide that in the financial expenses little increase from EUR 2.6 million to EUR 2.7 million. About the net income, Alex already explained that is the difference is related to the write-off of deferred taxes in Portugal. And I think it cannot add more of what Alex said. About the balance sheet summary of 2025, here we wanted to underline two main effects. Despite the increase of the sales of 4%, our operating net working capital is flat versus the year-end 2024. So you can see that the inventory trade receivable and trade payable are showing us exactly a flat net operating capital of EUR 4 million more that in the total of the amount is a very low number. And under the point of view of the net financial debt we increased the financial debt from EUR 36 million to EUR 44 million -- around EUR 44 million. So EUR 8 million more expect the result of '24 year-end. And I think that it's slightly higher than year closing and is fully under control in this moment. Here, we show you the fourth quarter average of the working capital as we are continuing decreasing in 2025, 29, 28, 26 days and the decrease of -- from September to December is due to a decrease of one day of the inventory. Nothing changed about DSO, and one day of the purchase, the part related to the payment of the vendors. The year-end result is fully flat at the end of '25 compared the end of '24, four days of working capital cycle. Due to everything that we said before, the ROCE, the return on capital employed evolution is before the IFRS 16, 6.1% and post IFRS 16, 4.9%, slightly reducing from the quarter before. Giulia, the stage for you.

Okay. Thank you, Giovanni, and good morning again to the audience. It's a pleasure for me to share with you the 2025 results of our sustainability path. Actually, thanks our effort on a journey that for sure requires determination and consistency. In the challenge of climate change last year, CDP again awarded us a B rating for both climate change and water security. This recognition confirms, let me say, the quality of our environmental policies and the solidity of -- we reduced our Scope 1 and 2 emissions moving closer to the target to 2027 target of a 12.6% reduction compared to the same baseline. For Scope 3 emission, we continue to carefully monitor our suppliers actively involved in the SBTi goals because we are convinced that the fight against climate change requires a shared responsibility along the entire value chain. 2025, as mentioned earlier by Giovanni and Alessandro, was also a year of strong growth for Zeliatech with the acquisition of Vamat our group consolidated the role as enabler of the green transition. At the same time, we took another concrete step toward an increasingly sustainable economy model by launching a certified service for collection and disposal of technology and office waste designed to support our suppliers and our customers in the responsible management of product end of life. But for us, as you know, sustainability also means and above all means people. In December last year, we obtained national certification for gender equality according to the UNI/PdR 125 that is a milestone that demonstrates our daily commitment to building a fair inclusive and respectful work environment. We also renewed our Great Place to Work certification in all the countries where we operate. And this award confirms once again our desire to continue improving by listening to all of us colleagues. We also worked to make the entire value chain more sustainable defining a policy for sustainable value chain management that fixes principal requirements and processes for assessing ESG issues for our strategic partners. On the governance side, 2025 marked another crucial step that is the publication of our first fully CSRD-compliant report that pushed us further towards greater transparency and to integrate even more sustainability into our business model. In the second year of reporting, we have intensified the dialogue with external stakeholders and we have set our financial materiality in line with enterprise risk management system. A further source of pride, let me say, is our positioning among the top 5 small caps in EG Index, which measures the governance excellence of companies listed on the Italian stock exchange, confirming the solidity and the credibility of our approach. With these results, our group shows not only that is consistently advancing its sustainability journey, but also that we intend to continue improving with responsibility and ambition. So that's all on my side. Now I'll turn the call over to Alessandro for the final remarks.

Okay. Thank you. So what to expect in terms of technology and landscape, what comments on the geopolitical scenario. Let's say that is for everybody, probably difficult to understand what the impacts on the economy as a whole will stem out of this major conflict in the Middle East. What we could say is that we are not directly affected. Our industry is not directly affected by the conflict. Meaning that the supply chain is not passing by the Hormuz channel. It's not challenged. We might suffer indirectly or profit indirectly if and when, as we hope the crisis will be over of the overall performance of the economy, clearly. If the GDP or the interest rates will change for the worst, at least short term, that might change the attitude of household and companies, and that might have some impact. We are not experiencing it so far, but still, it's what we can say so far of the geopolitical scenario impact. What we see on the other side is that the structural fundamentals of the company and of the industry are very solid. There's a lot of momentum in innovation and modernization and companies more and more are in need -- strong need of improve and strengthen their competitiveness, their resilience, and they do it through a lot of digitalization. That is driving a major, major growth in AI investments. This is a big opportunity, albeit sort of indirect opportunity for us, meaning that we are not directly providing products to the large hyperscalers, Google, Microsoft, OpenAI and the others. But on the other side, companies that are implementing AI projects are accelerating their digitalization processes and journey. And directly, they will require more products. And we're seeing it. We're witnessing it through our extremely brilliant performance in the V-Valley, so the digital solutions space. Now if you look at the role of distribution and channel opportunities, there's been a further consolidation during 2025. And on the other side, the vendors, we mentioned it before, distribution grew up to 48% of the overall route to market of vendors. Distributors are more and more central in vendors' go-to-market strategies. We are extremely well positioned to turn what is on a worldwide basis shortages linked mostly to the enormous investments of the hyperscalers in GenAI data centers. We are turning it into an opportunity for us. The products -- this consumption is driving product prices up, especially on PCs, smartphones and service across the board, I would say, but especially on PCs, smartphones and other devices and especially services, as I said, because of the higher RAM prices for us is an opportunity because we see our inventory getting more and more valuable day after day. We are now having on a routine basis, price increases every couple of weeks. There are vendors that are even pushing for once-a-week increases. So after decades living in a deflationary industry, we're now profiting from an inflationary industry. So that is something unexpected, and it's good for Giovanni and the rest of the team. It could turn into a nice tailwind. And as long as IT partners and users need to manage cost volatility, relying on the capabilities proven on ground in decades of distributors and Esprinet more specifically, it's particularly important. And so there are opportunities here. Last but not least, consider that most of our variable costs are linked to quantities moved, not the price of the objects moved. And the fact that PCs, smartphones are having unitary prices that keep on growing turns into an opportunity for us because the costs are linked to percentage-wise, the costs are on a smaller -- sorry, on a higher amount of revenues. So another opportunity. Overall, the analysts expect mid-single-digit growth for the distribution market in Europe in 2026. And we're seeing it in the first couple of months. The market is performing pretty well.

Also, we are happy of our performance in the last 2 months.

Yes, exactly. The market in Italy was flattish pretty much as last year and the Spanish and Portuguese market was running double digit, and we are happy. We are happy in what we are doing. So -- with this, I close my presentation, and then I hand over for what to come to Giovanni. Some comments on the succession process. First and foremost, Giovanni, I already said it before, Mr. Testa joined our group back in 2001 in the back office department Group controlling. And then in 2016, meanwhile, grew took a bold challenge that I put on his desk and say, why don't you turn a salesperson in a sense, a commercial. So he took responsibility, joined the management team, the leadership team and as business operation manager ran 5 commercial departments. And he showed an expertise in sales and marketing, which you normally don't see in people that come from back office [Audio Gap] the Chief Operating Officer back in July 2020. And together, we have shaped and driven this last 5 years of strategy and implementation. Giovanni is a serious and committed person, and he has the energy. And now I come to my position. I will step down effective April '23 (sic) [ '26 ] during the AGM, which will appoint Giovanni as a Board member. And in the subsequent Board meeting, he will be given the powers as a CEO. I will step down from all my roles in the company effective April 30. And I will stay as a shareholder of Axopa. Now why am I leaving? It's -- well, I'm turning -- of course, it's always a little bit difficult to say this. This is sort of my third baby Esprinet. But I'm turning 63, and I'm turning down for personal reasons. You need a special degree of energy to do this business, and for a number of reasons, I realized that I no longer had the right energy to do it. Unfortunate as it is, and it was, I had to take this decision. I decided to step down earlier than expected. I would have probably continued for some time. And we have managed to smooth the transition as much as possible and -- we have a very solid management team. There's a lot of continuity, as you see in the people that are running the business and in the strategy itself, Giovanni will comment in a second his expectations for now on. As a shareholder, I'm -- I joined by our Chairman, Maurizio Rota, contributing our shares back in 2022, Axopa investment vehicle. We then bought further shares, and we have now close to 7 million shares, so around 14%, slightly more than 14%. I also have less than 100,000 shares on my personal account out of past stock option plans. I speak in the name of Maurizio as well. We are strong believers in the industry, especially now we see tons of opportunities and in the company itself. If only as always, life sometimes takes you to other journeys. We believe in it, in the company, in the industry. And so we are together. The company is a single entity, and we invested always with unity, which is the rule of bylaws of Axopa. So count also on a stable shareholdership from Axopa in the foreseeable future. And that's it basically. Let me now turn the stage for the future to Giovanni, who will be your host in the future. And let me thank everybody before the Q&A session for the trust and support you gave us in the time. I'm proud of leaving a strong company with a sound balance sheet, an excellent management team, incredibly good prospects. And I hope as a shareholder to keep on reaping the rewards of what we have built in time, and I'm pretty sure Giovanni and the rest of the management team will keep on nurturing in the future. Thank you, everybody. Giovanni, up to you for the looking forward.

Yes. Sorry, a few words before to speak about 2026 because it's also a special moment for me, and I would like to say thanks to Alex for all he was able to transfer to me in 25 years of working together and it was a pleasure to work with him. And I hope to be a good guy from -- for Alex also in the next years. As Alex said, the strategy the group strategy will not change in this moment. We are -- since 2024, a moment in which we divided the group in three brands and three different go-to-market Esprinet, V-Valley, and Zeliatech, the results that we have reached in '24 and '25 demonstrate a good strategy, a good vision that we had, and we wanted to continue to -- for sure, we will continue to invest and to add all the energies and also the resources that we had in the V-Valley and Zeliatech space because we think that solution services and green technology are the right markets in which we have to move and we have to grow. For sure, we will try not to lose every opportunities that investment space the market will offer us. We want to continue to invest in people, in culture, and to grow with an organic growth, but also through M&A because our history, our DNA is a history of also M&A operation deals, which we have created in 25 years of the Esprinet Group that we are today. We will manage everything connected to the service model because also about services, we want to add another speed respect what we did till today. We have some ideas and probably in the next month, we will announce something. And we will want to be the right partner for our vendors and our customers, managing the digital transformation and also managing all will be related to AI overall generative artificial intelligence because we think that is another aspect, another opportunity that the market is giving us, and we want to be a main actor and not the background actor in this aspect. So we hope to have a very well 2026, and we will announce the guidance for the next -- for this year in May 13, if I remember well, when we will announce also the Q1 result. So thank you.

Thank you, Giovanni, and thank you, Alessandro. We can start with the Q&A session. The first question comes from Mr. Storer. Mr. Storer.

We're not.

Mr. Storer?

Can you hear me now?

Yes.

I have 2 questions. The first one is about 2025 gross margin, which was flattish year-on-year. You had some benefit from lower, let's say, factoring cost. And I would have expected probably some improvement in light of the mix, which apparently was supportive. So if you can elaborate a bit on that. Second question is about 2026 OpEx. Is it fair to say that in 2026, the OpEx increase should be nowhere near what we saw in 2025 -- and that's pretty much it, Alessandro. What can I say? Good luck with you on your life then?

Well, thanks, Niccolo. I take the 2025 question, and I leave the 2026 to Giovanni. And so on gross margin, Giovanni, to a certain extent, implicitly answered. Yes, we had a good performance in terms of product mix. But especially in Q4, we had in 2024, the solar business that benefited from a particularly high level of rebates. These are linked to the level of value add that you provide to vendors. This year, we were not able to reach the same level of contribution. We sort of expected it to a certain extent, not to that extent. And it's part of the strategic rationale behind the acquisition of Vamat, which I think we mentioned in the past calls. Vamat is sort of value-add distributor. They have the capability of providing certain certifications. And one of the investment rationale behind Vamat is the capability of bringing that capabilities to Italy. And that would sort of structurally give us the access to higher rebates, aside from having an additional source of revenues, margins and profitability out of the different new geographical regions where we are operating by means of being in Vamat. But that was the concept. Essentially, that was the main issue. The second one, to a lesser extent, was a little bit of overperformance in the retail space that we had against our expectations. Mostly because the PC refresh cycle was particularly strong and some of the additional sales came out of that area. And you have seen it in the mix of screens that were growing particularly well. And that was the second effect, I would say. For the OpEx, I turn it to Giovanni, and I want to thank you, Niccolo, for the kind words. I hope my future will be good and long. So thank you.

Okay. About OpEx, as we mentioned before, the DNA of the group is to have always under control the SG&A cost, and we will continue to do that. We have some plans also for reducing some cost related to the logistic brands. In fact, using the -- also the value and the volume of the inventories that we have. We are working -- we can anticipate that we are working on the possibility and we will think to reach the target to close the warehouse for the end of half one. So in order to reduce the cost related for logistic point of view. But for sure, we will add -- sorry, a big control of -- very hard control of the cost, and we are trying to maintain the level of cost that we had in 2025, having a growth of all the other figures in our profit and loss balance sheet.

Next question is from Mr. Berti.

Remember to unmute.

Berti, please remember to unmute your microphone.

Alessandro and Giovanni, I have a few. First one about memory shortage. Could you give us an idea on how much PC prices are increasing due to this matter? And always on this topic, but demand-wise, I was wondering what are your expectation in terms of impact? I mean, do you see any reduction in volumes due to these price increases? Or you are seeing signs of customers anticipating purchases or changing ordering because potential concern about future products availability or price increases? And lastly, I was wondering for how long do you see PC refresh cycles supportive for the market?

Okay. I will try to answer both Alex and myself. About the last question, probably the need -- the number of months that we will see in the market to change -- to close the refresh cycle of PC and notebooks are around 6, 8 months no more. About the idea that we have on shortage and on the increase of the ramps, the price of the RAMs, we see in the market that in this moment, there is no a very shortage moment because the availability of the products for about all the vendors that we managed is close to 0. For sure, we are selling a number of items less than last year, but the increase of the price is more and more in percentage higher than the reducing of the number of pieces that we have sold. So at the end we see an opportunity in order to manage less inventory with a higher average price, and not changing a lot the percentage of the margin. For sure, the absolute value of the margin will be a good news for our profit and loss. And about the increase of the prices, -- we see in this moment, as Alessandro said, a change of the list price more or less every 14 days from the vendors, from the main vendors. And the increase -- the percentage of increase is double-digit. And for some few items, also triple digit comparing the price that was present in the press release in September, October 2025.

Yes. If you want to buy a PC, don't wait, buy it now because it's -- we are seeing something absolutely unprecedented. It's something -- vendors are paled by what's happening in the market. And it will last. It will last for many, many months.

Another question from Mr. Paladino.

I have just one last question because everything has already been answered. It's on the factoring side. So we saw that your off-balance sheet factoring increased. So can you help us maybe understand whether this reflects a deliberate choice in the balance sheet management or whether it's partially linked to the evolution of your working capital dynamics?

Yes. Well, it's pretty simple. It's sort of seasonal effect. By having an overall strategy of progressive reduction of our exposure to the consumer market, consumer in the sense of retailers. Because of the PC cycle replacement, we had a spike in sales, and that happened mostly in Q4 and some of it went through retailers more than expected. And that was the main driver of factoring increase, meaning that we normally sell retailers' receivables to factoring. So in time, as the sales to this market segment declines, you might expect a decline on the factoring amounts. If they spike, you might expect a growth in that area. So that's mostly a technical issue. There's no specific decision of managing the balance sheet by means of factoring. We have some frame agreements with factoring companies as well as with retailers. And whenever we sell to them, we sell the receivables full stop, nothing more. There's little room for playing with more or less sales of receivables there. It's linked to the topology of customers.

And a question from Mr. Kontos.

Alessandro, congratulations for this new stage and Giovanni, congratulations for this opportunity. Just one comment on Spain. Can you explain a bit the performance relative to the market? How that is explained? Is it something that should worry us? Is it linked to device screens? What's -- why Esprinet underperformed the market basically in Spain?

No. In Spain, hi, Konstantinos. Thanks. No, no, it's a deliberate performance over there. Spain is on fire as a market, really growing, and we are hitting on all cylinders. But our strategy, you might remember what we did in Portugal a few years ago is to walk away from unprofitable or excessively working capital demanding portions of the business. And that's mostly what happened in Spain. We outgrew the market in the Solutions segment. We did really well. And we pulled on the brakes on certain PC and consumer-related -- consumer products related sales to retailers for this reason. So we lost a portion of market share. Mostly is linked to smartphones, where we walked away from certain Chinese brands, smartphone Chinese brands, which were driving ridiculous amounts of working capital, and they are performing well in the market. So from a market share, that's what's happening. But Spain, if you look at the segment information in our press release, you will see that we have had a phenomenal year.

Next question from Mr.Nargi.

Just two quick questions on the -- the first one is on the device segment. So we have seen a decreasing trend over the year and also in Q4, you explained it is mainly due to your choice to avoid lower profitable revenues and with a lower return on capital employed. I was wondering if going forward, so in 2026, this trend may continue or we may assume a similar weight on sales compared to what we have seen in 2025. The second question is on the tax rate. So we have seen this increase in tax rate mainly due to the write-off of the deferred tax asset. So going forward, might we expect tax rate to come back -- to go back to, let's say, reasonable rate. And finally, thanks, Alessandro, for all. Thanks for sharing your expertise on the industry and have a nice second life. Thank you again.

Thank you. Thank you, Pietro. And Giovanni is as experienced as me. And so even more so now because it's so much more in day-to-day. So I leave as long as it's mostly 2026, it's up to you.

Okay. From the first question about the devices, we can say that in this moment, we don't see any difference between '25 and '26 way to approach that type of market from our group. And also, we don't see any difference in the go-to-market of the vendors that are managing that product categories. So nothing changed. Nothing will change in our approach. If the working capital is not good from our point of view and if also the gross margin and gross profit are not in line with what we are expecting, we will decide not to manage some deals. About the tax rate, we think that with the exception of the spike that we had in 2025 due to the Portuguese write-off that we mentioned before, we will return -- we will come back to the average percentage of taxes that we had in the last 3, 4 years.

Unless the law changes, of course.

For sure, unless the law changes. On the contrary, we will have to be subjugated to the new rules.

Okay. There are no more questions. So I think we can end the call. So thanks to Giovanni, special thanks to Alessandro. Thank you for participating, and we remain at your disposal. See you next time.

Thanks, everybody. See you in the next life.

Bye.