FNM S.p.A. ($FNM)

[Audio Gap] This performance has offset the increase of revenues, which was obtained, thanks to the increase in the amount of passengers transported. As to the other companies consolidated at equity, the performance improved for Tangenziali Esterne di Milano, thanks to the better performance of Tangenziali Esterne following the capital strengthening and the growth of traffic, which was plus 2% and a more favorable mix of the vehicles that traveled on this infrastructure. Let's now move on to EBITDA. EBITDA increased by EUR 3.1 million versus the first 4 months of 2025 -- sorry the first quarter of 2025. So everything increased with the only exception of railway infrastructure. However, we should say that during 2025, railway infrastructure eventually reabsorbed at the end of the year, the positive performance that had been posted in the first few months. Let's now look at the performance of individual businesses and segments. So as usual, I shall start with Motorways. In Motorways, EBITDA increased by EUR 3.4 million during -- on a quarter-on-quarter basis. And this increase is mainly due to the positive increase in traffic and traffic mix and also to 1.5% tariff increase, which became effective at the beginning of the year. Another positive element which contributed to this EBITDA performance was the reduction of maintenance expenses. In particular, we have completed some nonrecurring works that have been performed in the first quarter of 2025. We also had a lower level of maintenance during the winter as against the same quarter last year. And also, we have rescheduled works on pavement and on the replacement of safety barriers. So there was a kind of a timing mismatch in costs incurred. So this lower maintenance costs have been offset by lower use of the renewal fund, which is actually in line with the investments that have been put in place. Because of all those factors, EBITDA was EUR 39 million in the first quarter of 2026. Let's now move on to Railway Infrastructure. Railway Infrastructure has posted EBITDA, which, as we said earlier, has decreased by EUR 2.8 million as of March 31, 2025, down to EUR 0.8 million as of March 31, 2026. The main reason for this reduction is that in the first quarter of last year, we have cashed in insurance reimbursements, EUR 2.6 million because of damage from hail and damage from the flooding of the Breno River. So this was actually the main effect, which impacted on profitability. Also, we should realize there was a reduction of revenues from public grants. And this is mainly connected to the planned contracts that now shifted from the design stage to the construction stage. Also, we completed the supply of trains, which are actually funded under the 2017-2032 program. And we updated the service contract, which had a positive impact for reopening the Brescia-Edolo railway and for an increase of safety expenses. Now having had a reduction of revenues from contracts and public grants, we also posted a reduction, however, of the operating expenses and maintenance costs in particular. Now these are due to the lower usage of rolling stock taken from the warehouses for the maintenance of the Bornato-Sale Marasino line and for the maintenance of the railway updates that have been made in the first quarter of 2025. Another impact we had in this quarter was an increase in the cost of personnel, which is actually under the other item in this chart, which is connected to the renewal of the national bargaining and national employment agreement. Let's move on to the Energy segment. In the Energy segment, EBITDA was constant year-over-year, EUR 1.9 million. So on one side, we have the positive impact on EBITDA of the increase of installed capacity and so the increase of energy generation in general. The increase in installed capacity was over 15 megawatts as described earlier. Whereas on the other side, the existing capacity year-over-year actually suffered a lower -- a negative effect in terms of both price and volumes. In terms of price, the PPAs at which we sold energy had been agreed at the end of the year 2025. And actually, these prices were lower than the year before. Also on some installations for about EUR 10 million, incentive schemes had to be applied under the FER 1 plan, which is actually lower than the market price. Besides -- on top of that component, there was a lower solar radiation compared to the year before. So together with the lower price effect, this caused a negative impact by EUR 0.2 million. Finally, another negative impact which offset the impact of new capacity, there was an increase in operating costs because of new installations starting their service in 2 out of the 3 months of the quarter. Let's move on to the Ro.S.Co. segment. Here, EBITDA increased by EUR 2.9 million from EUR 9.3 million up to EUR 10.2 million. Now this change is due, first and foremost, to an increase of revenues for the train maintenance contracts. This is due to also to higher lease agreements for revamping and cyclical maintenance activities, which were performed in 2025 on TILO, TAF and CSA trains. Besides some contract reviews on TSR trains. So this higher revenue was partially offset by higher costs, in particular, because of IT services and consulting and sponsorships connected to the Olympic Games. And there was an increase in the cost of personnel because of new hires. Another positive impact in this quarter was a capital gain, which was EUR 0.5 million that has been cashed in following the disposal of [ Pisa ] property. Finally, the Mobility and Services segment EBITDA increased by EUR 1.2 million from EUR 1 million to EUR 2.2 million. Now this change is due to the increase in traffic, first and foremost, and to a reduction in costs mainly because of maintenance performed on the vehicles and lower cost of fuel without any increase in tariffs. Revenues from public service contracts also posted an increase of EUR 0.6 million because of the higher price per kilometer in Verona, which is also connected to an increase in the itineraries we cover there. And also, we had higher grants for CapEx, which was made during this period. Now versus this positive impact, we had an increase in the cost of personnel that had an impact of EUR 0.2 million. Let me now give the floor back to Eugenio, who will be talking about cash flow and net financial position.

Thank you, Valeria. As to the financial components in this quarter, cash flow generation absorbed EUR 2.6 million because of several factors. So on one side, the FFO was EUR 54 million, net working capital, which is connected to 2 particular factors. The first being a growth and increase of credit from Trenord versus FNM for the full implementation of the new ways we adopted to manage maintenance under the service contract. And the second impact was due to credits cashed in, outstanding credit to be cashed in by ATV from the Province of Verona. And on the other side, we actually paid some suppliers, which was mainly connected to funded projects plus a few others. So because of all this, we have the bridge and the net working capital has this performance, and this is quite frequent historically at the beginning of the year. Let's look at CapEx now. So on the left-hand side, you see the amount of CapEx was slightly lower than the year before. So there was a reduction in Motorways because last year, Motorways necessarily had to complete CapEx invested in the 5 hydrogen-powered service stations. So that's finished this year. And on the other side, some of the investment connected to Motorways and in particular, the [indiscernible] as planned, has not yet been approved by the Ministry of Transport. As to Railway infrastructure, here again, there was a reduction in CapEx. We have lower revenues at P&L, too. And this is also due to the fact that last year, there was a huge construction yard, Terminal 2, which was still open, whereas now we're back to a more normal CapEx level. On the other side, there is an increase from energy from EUR 3.2 million to EUR 8.7 million, which is due to the fact that last year, there has been a pause, a kind of stop in CapEx investment awaiting FER X. And this year, we are actually going on as originally planned. The more significant increase we see here is at Ro.S.Co., which is totally planned and this the outcome of some of the new Caravaggio trains that are going to be completely installed by the end of May, and they are actually fully in line with the original scheduling. And besides that, we also have investments made for cyclical plans we are engaged in as we go. There's a reduction in Mobility and Services CapEx, and this is the outcome of the different ways with which we actually renew the bus fleet. Sometimes we have to come to terms with the actual timing of the providers and the availability of new buses. So this is why we have these changes in cash flow and CapEx. As to the net financial position, you see that net financial position has worsened and a significant factor was a change in financial debt because there was a review in the way regional authorities actually provide financing of their funded programs. So in the first quarter of 2026, some early payments were higher than the actual expenditures. So that generated financial debt versus what we had at the end of last year. As far as debt is concerned, gross debt is EUR 814 million. And as the end of 2025, it was EUR 748 million (sic) [ EUR 848 million ]. So we may want to think about this for a second. One year ago, that was -- that value was EUR 982 million. So what happened in the meantime? Well, in the meantime, we have reimbursed the funding so for about EUR 185 million. At the same time, we started a credit line for EUR 40 million with Finlombarda, and this happened in July 2025. The cash available, as you see, is pretty much in line with the previous years. So cash generation plus some delays in CapEx has meant that we ended up reimbursing both outstanding debt and the rolling credit facilities in March 2026. And so we actually ended up with a pretty easy cash position, but we reduced our debt exposure. Now as far as our rating is concerned, we have confirmations from both our rating companies. And as to the breakdown of funding sources, there's no big change there, which is actually what we expected. We actually had already signed the financial agreement in July. And so we knew that up until the autumn time frame of this year of 2026, there's going to be no major change in the debt structure. This slide shows what I partially explained already, which is that the greatest chunk of the bond is going to be changed in the second half of the year only. So this is our presentation of the overall picture of the financial performance in this quarter. As far as the outlook is concerned, we have no particular changes to report. So we can actually confirm the outlook we had announced when we closed at December 31, 2025. So you see the outlook here. The EBITDA guidance is in a range between EUR 230 million and EUR 240 million. CapEx is expected to stand between EUR 350 million and EUR 400 million and net financial position is between EUR 850 million and EUR 900 million. So this is our guidance. And eventually, the net financial position over EBITDA will end up having a ratio which will stand anywhere between 3.5 and 4x EBITDA. So of course, should CapEx confirm a trend which is not fully in line with the guidance, then if that happens, as a consequence, CapEx and net financial position would be updated. However, as we speak, we have no consolidated view of that particular forecast. So we will give you updates, if any, during the next few calls or meetings we're going to arrange as we go. So that's all for our presentation. So I suggest we now hear from you. And if you have questions, we'll be happy to answer them.

[Operator Instructions] The first question will be asked by Milo Silvestre of Equita. We missed the beginning of the question. Would you please start again because we could not hear you when you first started asking your question. We can hear you now.

My first question was about new investments in trains. So can you give us a view about why you have renewed your investment plan for trains? And the second question, which is a follow-up of the first is what kind of EBITDA impact do you expect when all trains will be fully committed?

Thank you. As to new CapEx invested in trains, you've all read the press release. It's about 20 trains. So an opportunity arose with our stakeholders. Quite simply, Trenord needed to actually comply with some changes in its train fleet. The regional authorities right now were not as nimble as we were in actually stepping in to actually purchase new trains. We had a framework agreement we could resort to. So we assess the situation. And what is actually different from the rest of the fleet is that for lease calculation, you may remember, we had that same as nominal 5.5%, which is calculated on the value of capital. But there's another component that goes into the compensation, which is 5.5% on the net book value at the end of the period. Now in the previous fleet, which is the main fleet, full amortization was expected to be posted at the end of the service agreement in 2033. Now these trains are going to be bought in 2026 and the residual net book value will be significantly higher than 0 by then. So the performance we expect them to give today is actually higher than 6.5%. And so it's higher than the rest of the fleet for this particular reason, which I just explained. However, this kind of CapEx is an investment which belongs to the parameters, the CapEx parameters we've always complied with. And so the impact on financing and debt is actually within the limits that have been originally expected and forecast when we signed the financing agreement in July last year.

Can I ask about the EBITDA impact once all the trains will be commissioned?

Yes. The impact is in excess of 6.5% and all trains are going to be fully operational between Q1 and Q2 2028.

Next question is by Davide Rimini of Intesa Sanpaolo.

I'm also curious about this press release you have circulated in April about the new trains and the possibility to review this investment and recalculate it within the guidelines of the business plan. So I think I understand that on a overall basis, CapEx investment will not change. However, even considering what you just said about the expected performance of that investment, I seem to understand there is a different allocation between different units. So if I remember correctly, in your business plan, you were talking about Motorways and Energy as the key businesses to invest in. So I'm wondering, can you give us some information about the impact of this investment as you just described it? And could you please tell us whether this means that the point of arrival will be different from what originally planned?

Thank you for your question. Davide, yes, partially, the answer is yes, of course, because on one side, the profitability of this kind of business is lower than the Energy business, for instance, or the Motorways business. So from a certain point of view, this certainly means a reduction in profitability. However, on the other side, this still stands as a source of lease, which is virtually risk-free, because, as you know, apart from the Trenord service agreement expiring in 2033, anyone -- any player who will actually continue the contract after that date will be obliged to ensure the continuity of existing fleets. So from a certain point of view, the overall profile will change. But at the same time, this is a relatively small value. So take this with a pinch of salt. So let me remind you that we had an overall plan of EUR 1.3 billion and the amount invested in these trains is about EUR 170 million. So it is about 10% or 11%, but it's not that overly relevant. And also, it's going to be accounted for between today and 2028. So we do believe this is an impact, which is altogether not material on the overall group business plan.

May I ask a second question? I'm thinking of the guidance for this year. I just heard you confirmed it. But I think in your presentation and the press release, too, you made reference to the geopolitical scenario. So I was wondering this new disclaimer, this new sentence is, of course, justified I mean, considering the current situation we are living. But can you give us some color on your sensitivity to the geopolitical scenario? So you just mentioned price inflation. But because of the business typology you operate in, can you just give us some ideas of the possible impact of the current geopolitical situation?

Well, of course, we do have concerns. So let's see it on a sector-by-sector basis. Now as far as Motorways are concerned, we actually performed a risk analysis to try and understand the possible impact of the current situation on the Motorways network. However, this risk is kind of a, let's say, pass-through risk, meaning if people keep using their cars as though nothing happens, which is what we see now, then we would have no impact on the Motorways either. Maybe the increase in the price of fuel may reduce traffic. Maybe that's the only risk actually. But over time, this has shown that there is not a lot of elasticity in terms of accommodating higher cost of fuel with lower traffic volumes. As far as infrastructures are concerned, I should say this is not relevant. This is not -- there's no direct impact. There may be some impact on the infrastructural component because of the higher cost of energy in the general sense of this term, which may actually translate into higher costs from our contractors. However, it all depends on the -- actually the main contractor, the region, which is something that doesn't involve our P&L directly. So we don't expect much effect on that. Now Ro.S.Co., even there, I would say these are predefined agreements and contracts. So if there is an impact, it will be very limited. For the energy components, if things continue to increase, we actually witnessed that. The market price today is higher than the value of incentives, actually more than we originally expected. So the idea that the installations we have at FER X and FER 1, well, if we really think about the geographical location, we may need to think that some of these programs may not receive an advantage from the incentive program anymore, but we'll see that as we go through the rest of the year. So if we do have an impact, it may end up being more positive than negative at times. Maybe the only component where we do see a higher level of risk is local public transportation, road local public transportation, where actually the increase in the cost of fuel may indeed generate some impact. However, we know that since this is local public transportation, there might be some timing difference in absorbing that risk. But eventually will be acknowledged to deserve and to receive some local grants from the competent authorities.

I see. My last question is on CapEx. You gave an indication of the level you sustained in the first part of the year and you gave a breakdown in different businesses, but you confirmed the guidance, which sees a major acceleration. We already partially understand why, which is the Ro.S.Co. investment. So I'm just wondering, if I get your message well, the guidance on your debt is connected to the level of CapEx and CapEx that may be reached if today you actually confirm all of your data. So do you think there will be any challenge for you to get to that level of CapEx, which is anywhere between EUR 350 million and EUR 400 million? That means you are supposed to accelerate remarkably starting in Q2 immediately.

Sorry, I was muted by mistake. So let me go back to my answer. So as far as CapEx is concerned, of the EUR 350 million to EUR 400 million expected, the Ro.S.Co. component is about EUR 180 million. And this is connected to the delivery of the Caravaggio trains that are expected to be delivered between the end of March and May. And so everything is going according to schedule. So that EUR 180 million is not accounted for or just in a very limited way in the first quarter, but it will be a key component in the second quarter. Then the infrastructural component, while there, again, there are no major changes expected. The 2 areas where there may be some differences are Motorways on one side, where there is an external element, which is the authorization from the Ministry of Transport. But there isn't much we can do about that. I mean we actually keep traveling to Rome, but it's up to the ministry to sign it off. And then there's another component where we think we can actually make up for lost ground, but we're slightly late today, and I'm referring to the investment in renewable energy. So some of these investments are actually due to the connection with the electricity grid. So some of the investments are earmarked for that particular part of the business. And there, we do see more and more that there are delays compared to the past. So for instance, the connection to the Terna grid is actually slower than we originally expected it to be. So hopefully, we'll be able to recover that kind of investment during the rest of the year. But maybe that's the only component where I do see some risk together with [ Visa ]. But there are different reasons. I mean it's always external factors, but they're different in nature.

But if I may, I know you gave no specific guidance on a division-by-division basis, but it may be about EUR 70 million per division. And I'm referring to the CapEx invested for this year for both Motorways and Energy.

And the answer is yes, that's the order of magnitude more or less.

Next question from Chiara Pampurini of Intermonte SIM.

Can you give us some color on the EIB financing that's been announced in your press release yesterday?

Of course. This was a financing which was -- we have been working on already for quite some time. We signed the General EUR 1 billion agreement with Lombardy for the end of July. So this is something that has road back in our past, and it is related to investments in hydrogen, in particular, in the hydrogen programs. So both in the Hydrogen Valley which is the hydrogen fueled transportation trains, in particular, then the generation systems, the 3 installations. And finally, also the buses that are going to be fueled with hydrogen based on one side. So on the other side, and the investment components are the 5 service stations and the Serravalle Motorways, hydrogen powered too. So this is a program which was started some years ago. In the meantime, then we had the PNRR in some. So what used to be a much higher, some eventually got lower because of the public grants and this kind of CapEx, which ended up reducing the overall base where the EIB could lend money. And it was kind of set aside for a while in order to close that EUR 1 billion that you're all familiar with, and we closed this one, too. So it's a bit like in the Finlombarda program. The main feature versus other investments is that it went on for -- well, the duration is 15 years. So it's took around for 15 years from the first disbursement. We'll have 3 years for the last disbursement. So that means that we'll be able to reimburse it in anywhere between 15 to 18 years from today. It's nonamortizing system. So from the time when the first payments are made, then we'll start reimbursing the underlying capital, but it will take up to 15 or 18 years to do that, as I said earlier. So because of the role of the EIB and because of the nature of the underlying investments, these plans normally do have a very long duration. We are very, very happy because on one side, we were able to actually sign it off and it had been outstanding for a while. And on the other side, once again, we obtained trust from the EIB and SACE that has provided the insurance coverage for 50% of this.

[Operator Instructions] Ms. Minazzi, there are no further questions at this stage.

Thank you very much. Thanks for attending. As usual, we'll be available in case you need further clarifications later today or in the next few days. And we'll meet again on September 10 for the first half results presentation. Thank you. Goodbye.

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