GPI S.p.A. ($GPI)

Good morning. This is the Chorus Call operator. Welcome to the annual 2025 financial results presentation of GPI. [Operator Instructions] The floor is now to Fabrizio.

Good morning, everyone, and thank you so much for joining us this morning. Today, we will be talking about the results of full year '25 results. We will also be talking about leadership with a strong international rate. I stated to redate Investor late Director. Together with me, we'll have a [indiscernible], Investment Manager. So this end today. We will have point number one, a GPI growth overview. Mr. Santoro will give you details of the results of FY 2025. We will be on the [indiscernible] business, and we will close our session, of course, with a Q&A session with my colleague. Thank you so much for being here this morning. The floor goes to the CEO now. Thank you.

Good morning, everyone. Also welcome from my side. So let's start this overview by talking about four key messages that we would like to share with you this money. The first message has to do with strategy. Now you know very well that in January 2025, GPI Board has approved an industrial plan from '25 to '29, which is also basically the reason why I have accepted my term. The first piece of information is that we are on track. So we are aligned when it comes to results to 2025 with the expectations you can see in the plan. So you have the most important highlights on numbers that you can see here, EUR 546 million proceeds in 35 million, a plus 7% organic growth year-on-year. of which 5.8% organic only. Well, good news is due to the fact as EBITDA grows more than proportionately it reaches around 20.8. The increases of 30 bps or 30 basis points year-on-year. Now all of this was made possible thanks to the more EUR 400 million investments that we've carried out in the last 9 years. So this income and -- well, basically, this is the second great piece of news. So the second highlight, I'd like to add your attention on, so the EUR 546 million are within a 17% growth of international proceeds. And they've given a contribution to the increase of flexibility. Once again, this is also on track, so in line with the plan because what we would like to do is a bigger and bigger internationalization public company. So performances and growth. And the third point is leadership. So once again, also in 2025, we are the benchmark company, so to say, so the leading company as for the eHealth or digital health market. So how can we do this? Well, we do this, thanks to other very important news because again, we are #1 in this business in Italy today, [ surround ] the plan. We also would like to become #1 in this industry in Europe. So the acquisitions that we've done recently in France, well, let's say, that this has been done in compliance with the behavior of this logic. The so-called software business, as we like to call it, let's say, that it is the protagonist of eHealth. So what you can see here are the, well, three pillars of our internal portfolio. on the op side that you have the so-called core solutions. So basically, these are solutions that stick to the needs of our customers. well, not necessarily Italian only. You can see here that the HIS in English, Hospital Information systems. This is what we have in Italy, but also in the DACH just in Germany, Austria and Switzerland with PCS, one of our companies together with in France. So within this context, we also offer other solutions concerning the, once again, HSI. And in particular, we also have software programs in order to, let's say, populate medical doctors, wealth agendas. This means that we can manage the tail or the Qs, if you will, in every single region that we are working in. You can see here the second pillar, which is the vertical part. Now it's a vertical because basically, these are scalable products. So they may become international. Once again, we have medical devices, and you can see here the macro areas. So once again, you can see here blood. So the, let's say, transfusion management donors management in 2025. And by the way, as we signed important contracts. And so we got a contract in Wales, and this is the management of the health care and the transfusion platform for Wales this will last 10 years. So once again, we also have diagnostics, imaging, digital pathologists. As far as this business is concerned, I'd like to highlight a contract we signed in Germany, the first one we signed in that area. Based on the current feedback in 2026 and 2027, it won't be the last one. This is for diagnostics and the products, if you will, we have exported from Italy to abroad. As for CC, so critical care, this is part of an import process. Once again, this is a company we've taken over back in 2023. This is basically the operating theater management system. This is what we are installing in Southern Italy. So we are now installing the first such type of software programs. So these are the products to be scaled up. So together with the so-called software business, we have the so-called diversification. So the strategic diversification of the space, we have services, we have the take-up of the patient, we also have automation business. I'd like to, well, tell you something more about this business because it has to do with basically a drug management or drug robotics. We're now taking part in a very important tender here in Italy. So this is a really big one. So 3x as big as the yearly Italian market. So we will give our help in hand in installing our robotized systems blows to increase the effectiveness, at the same time, will lower the health costs because we will reduce waste of drugs in our hospitals in Italy. Another key highlight is the following, and I really would like to highlight this talent, this is a start-up. So a very special startup. Now you know that basically, we have protective environments in which some drugs are produced, thanks to our robo-based technology in '26. But of course, in 2027, we will have no installations concerning the preparation of chemo therapists. So this means we will improve efficiency, effectiveness, we will improve the quality of the product at the same time reducing waste. Now to tell you how big the portfolio is, I have shared with you the four previous points. Let me go back to the business plan or industrial plan. Now of course, today, I won't be sharing with you hundreds of slides. You can see here once again the fiur main pillars. But I'd like to highlight your attention now on the progress of our organization. So where are we now? If you really want to strengthen the leading position in Italy, you still want to also grow internationally for the vertical software products or to diversify products, our target, if you will, as an organizational structure, that has to be stronger, more solid and being able to meet the needs of the strategy. So at the very beginning of 2026 in January, we launched the new Italian organization; so we have the typical matrix structure. Once again, I won't give you too many details, but we have these verticals, I mean, the domains. And we have the areas in Italy, so the north of, the centre of the country and the south of the country. So the main aim of this matrix is to create as much synergy as possible on customers this may suitably as close as possible to customers with the widest possible portfolio. Throughout 2026, we will also be implementing and scaling of this matrix internationally without forgetting that the main aim of internationalization is the vertical products. So basically MDO, medical devices business. So in 2025, so last year, but also this year 2026, we will be streamlining the business of rationalization. So just one quick word on telling you that over the years, we would like to have one legal entity per country. Right now in 2025, we have merged by incorporation payment and also inside the SBA. And in 2026, there will be another merger faces SBA. The company has been taken over back in 2023, by the way. Last but not least, talking about organization this year 2026, we will be implementing plenty of synergies on a corporate level concerning different functions, especially staff functions that may we will have cost cutting does increase in the margin level. First and foremost, IT, so systems and that procurement basically. So let me tell you about the targets of the plan. Once again, in 2027, so next year, we would like to hit the EUR 600 million, so plus 25% or 26%, If you have questions on the, well, attainability of the plan, well, I may tell you that the results of that, together with Matteo, our General Director, will be sharing interest with you today, but we're telling you that we have reached about EUR [ 550 ] million. So overseas accounts by 22% more or less. So EBITDA in 2027 will be 22%. Now we have 20.8% right now in 2025. As for CapEx, the return on investment, ROI and debt management, while we are working at this, but I have to say that we're getting closer to the targets. And in 2027, I think we will be doing better in our targets. It goes without saying that this means reachability or feasibility of those targets is once again possible also for 2029. Now a quick snapshot on our markets, I mean, where we are today. I think this is key today just to understand what may happen in terms of feasibility of the targets. So you can see here all the countries in where we are with customers, we have offices in 18 countries, 9,000 customers. Now all of those numbers will be taken down to two key numbers. We have basically 70% public customers, a 19% of private and the rest is nonhealthcare. So we also have different, well, if you will, consequences of previous takeovers at this quarter 12% of impact on the proceeds. So why are we doing this? Now before giving the floor to Matteo, I'd like to share with you a couple of quick points. on some strategy. I mean, long-term strategic points. And first and foremost, so can our targets be reached? So this is a question I come across quite often because we have to consider the so-called PNR, so the national recovery and resilience plan. Let me share with you some macro figures. In Italy, we have basically 30% of our software solutions covering the addressable market, which is worth of more or less EUR 1 billion. If we move to the rest of Europe, the market will be EUR 10 billion. If we also include the U.S., we will go to EUR 30 billion, more or less. If we make it bigger, we can also do better than EUR 50 billion. It goes without saying, our '29 target, which is $700 million organic business on a market, which is now very international. I can say, EUR 50 billion, but maybe EUR 25 billion. If we have the right organization, which is what we're doing today, considering the targets for 2026 and by leveraging all of our people, I mean, our employees because, of course, they are the key for success of the company was based on all of these conditions I'm pretty sure that we won't have an issue. So growth is not an issue. Growth will be there. Second key highlight is represented by AI. What you can see in the slide is one of the slides that we shared with you last year and the previous presentation to tell you what we're doing. But I mean, the fourth line to share with you as far as this slide is concerned, it is on the impact of AI. I need to say this is a sort of a disruption or an industrial revolution, it will have an impact on us and even more in the future. But as for GPI, well, I'm pretty sure that this is -- I mean, we have the right change management process. But this process requires, I mean, the knowledge of the business. I mean we have our products, you must have seen that they are in critical closures. So once again, you can see here T or T-shaped skills, but I mean domain and process. And this is only possible, thanks to what people wanted this. This cannot be replaced by other skills. And so even if this new industrial revolution is about to come and we feel the impact, well, we are sure we can have all of the advantages or the benefits out of this revolution. You can see here that we will be able to keep costs down. But also, we can say that there won't be any impact in terms of layoffs, for example. This will bring about more efficiency on us on the company, especially on our customers. But very last point before giving the floor to my colleague concerns data. Now we keep talking about national sovereign age is a very hot topic, and I have to say that [Audio Gap] this is something that I won't do today. I mean, I was just thinking of the international -- current international geopolitical situation. But the international situation is such that if I switch off a server somewhere in the world, if we don't consider national sovereignty, well, this may have an impact on to our business quite immediately. We have invested in the [indiscernible] mining. This is a sort of a new mine, if you will. So in terms of circular economy, I have to say that instead of being dispensed, I mean once you've taken all the material in the mine Well, basically, you create sort of cases. Well, we are reusing those cases. And this is why we made an investment there in order to include well, service processing data. Well, in the near future, and there will be some information for you concerning this. Our directly managed service would be in TDM so that we can once again have a fantastic strategic solution. This is it for the part of my presentation. I will now give the floor to Matteo. He will give you more insights on figures. Thank you.

Thank you, Andrea. Thank you so much for introduction. Thank you so much because you've conveyed the clear and key messages to be able to understand the ecosystem that we have created these opportunities for us are important meetings so that we can talk about sort of an invisible reality, which is something you won't find in balance sheet or financial statements. So I think it's good for you to know about strategic solutions for the next year or so. So let me follow up on what our CEO just told you. Last year, thanks to the approval of the strategic plan, so that was back in January 2025, I mean, we closed the part of the business of phase. We've been able to grow by externalizes of [ 60 ] acquisitions, takeovers in the past 7 years. We wanted to become bigger and pick up in a more global market. So the choices will be either we will become bigger and bigger or we will stay too small. This is why there's been plenty of M&A. So we've grown by addition. So we have added companies. Then once we have used all of our resources, we decided to start integration and synergy. This is the reason why the 2025, 2029 industrial plan is basically based on organic growth processes. So 2025, this is the year where we started integrating or taken onboard of the new companies, which are now included into our ecosystem who generate value. So the value that we may have generated in the past as well. But once again, we -- maybe we're not thinking about growing or becoming bigger. So in 2025, we worked a lot on the reorganization, integration, creating synergy basically on the country, so in Italy. So much so that some months ago, at the very beginning of January, we created, I mean, the new organizational model for Italy. So we maintained this kind of orientation. We stayed focused on the market and the results we've been able to get, in our opinion, our various satisfactory numbers. First and foremost, because we are still the leading company in the country. We are the #1 software technology company. This is 14% of the market. Our second competitor is around 12%, and the third one is below 10%. So once again, our leading position is reconfirmed. And this is crucial, present. The second good news is that we grew as much as we wanted to on foreign markets. So many other countries, they also have delivered great results with a double-digit growth. So just think of these numbers at the end of the plan, we may close with a result and maybe even better than the expectations you can read in the plan. Now this year, we focused on letting people understand that we are a software company. So once again, we want to be a software company. Even if in our assets, in the list of assets, we have automation. And people may think that these are, well, diverse businesses, but no because there's a fill rouge having to do with technology and a strategic [Audio Gap] time, we'll be talkabout. [Audio Gap] So these are software we would like to the fact you want to be a software company as well. I talked about the organic growth, but we don't exclude the opportunities. which is work with them, in 2025, we've taken over some foreign companies, thanks to the French business. So we have taken over [ Logiprem-F ]. We've taken over Sincon, Mondo EDP here in Italy. Now I have to say that these companies are speeding up our software focus and especially, they help us so much the final results or to the final numbers. Altran has been acquired at the end of the year. So you don't see the impact here. You see the impact on the debt, actually, but you don't see the positive impact in terms of profitability. Now let me share with you some key numbers, which, in my opinion, is what is most interesting for you. Proceeds moved from EUR 510 million to EUR 546 million. Now the growth is 7%. And again, this is in line with our expectations. Well, I should say that this year, this is a 2025 budget, we overperformed a little bit. And out of this 7% [Audio Gap] represents organic growth or organic income. So we can say that basically we are keeping with the balance, we wanted to have. EBITDA [indiscernible], and this is driven by software because out of EUR 113 million year, well, 90%, 93% is generated by software programs. And this means, again, we are going to the direction we wanted to have EBITDA margin as [indiscernible] goes up to 20.8%. It was 20.5%. EBITDA margin goes to 8.8%. This means we have an increase of the net profits from EUR 14.4 million to EUR 15.2 million this year. In this case, we have taken advantage of some tax aspects have to deal with the [indiscernible] because R&D has been rewarded because we're investing so much in enriching widening our product portfolio with new solutions, new products, including -- let me talk as well about AI as our colleagues said, AI is , if you will, exploding. We keep talking so much about this. But the real point is that there will be so many companies making AI, but we don't know how many will survive. So the key point for the market is that right for the basis, so we have to have domain. We have a big installed in the country. We also have the main skills that only a few competitors have. I'm sure you remember the previous presentations even during the COVID, we already talked about AI or those AI solutions in our work team. We already have plenty of expertise and skills delivering AI solutions because the main skill set has to be used to -- for this market. So our IT experts do have these skills. This means we will be able to speed up and increase the productivity of our solutions together with the introduction of plenty of innovation. Well, basically, as you can see in our financial statements and documents, so we've inaugurated our private hospital. The target of GPI, we don't want to change our business. We don't want to intervene in clinical processes, but this is a lab, and this lab is crucial to be closer to customers, those understanding better how to use this very important lever. So once again, this is a part, if you will, of the software program. So of course, I'm talking about AI and AI will help us speed up what I just told you. As for the Italy and the foreign markets proceeds breakdown, you can see here the foreign market, plus 17.1%, plus again it was our wish. So as you may remember, for those of you who know our company, in the recent years, we focused basically on growth or have the dissemination or sale of our products abroad because the product is an accelerator. So foreign market is going up 17.1%, a wonderful result for us of 36% of income today on a group level. Once again, software programs, well, is again coming from abroad. [Audio Gap] per is software in instrument of the 3 billion digression participant Ecoterra, Laiterie SP1 Code has been confirmed. Please wait while you are joined to the conference -- the leader has muted the conference. You will be monitor mode. So adding to this, we also have the concept tenders. And as you know very well, of tenders include the 2 different parts. The first part cases at the direct orders. So in this case, it has a direct business. But we also have another partner and this is the so-called ODA, as we say. Now this is what is used directly by the winter of the tender. So let's say, commercial actions at the customers. That's another part that concept concerns a specific standard. I mean there are resources which are not the [Audio Gap] results software primarily you brought you a 1 being migrated a little bit more process if you will. My ratio will continue, unstationary quarter trade rate on the level we call solution. So highlight is that the can it or tens -- and the further compensate the will you to the allocation also mandate of course, to to to many other areas as we well in 8%, this is a strategic areas. 5 Italian regions are exclusively using our solutions. Once again, we're still delivering on tenders that have been allocated. But once again, they haven't been concluded yet. Once again, HIS is absolute number one. It's being concluded. So once again, back to tenders, and this is again a very important topic. Well, I have to say the concept has published in Italy tender plan, which is really important for us. And is, if you will, in a medium to long term. It's important to say that in 2026, so many tenders will be up. We cannot tell you which tenders we will take part in for confidentiality reasons. But anyway, 2 tenders that have been announced for the month of May. It is into the concept areas. So this is the so-called [indiscernible], health at 3.0. There's another one in November. So this is [indiscernible], health care 1.0. Anyway. investments in this sector will continue. There will be very solid with different business models we will sort of move to SAS proceeds instead of making the traditional investments, which is what we've done in the past. But once again, what we see at the horizon is very interesting perspectives. Let me now talk about once again fixed the assets. And our fixed assets or FA went up. So from 2087, you can see here, well, this is basically what we have done in France. So again, we have the French business, we have concept. We also have other hospitals. This a very important hospital, for example, the [indiscernible] hospital. As for the net working capital, this is due to payment terms and conditions. Now what is important to say is that you will see some assets up trending. Basically '25, we manage the EUR 120 million control assets mature previously. This is due to the fact that, as you know, customers didn't allow us to invoice depending on the evolution or development of the proceeds. So the reporting PNR reporting system was an accelerator Anyway, we've worked on EUR 125 million of, [ FD ] in the previous years, 145 million, so to say, we have added 20% to 25%. This is due to the fact that our procurement system works with this system. So payment coming longer. Anyway, EUR 120 million of contract assets of the previous years have been resolved. So what you can see right here is the net effect, so to say. We also have a growth of debt invested from EUR 396 million, which is what we have now, it was of EUR 336 million. The growth is EUR 60 million, EUR 42 million because of the debt contracted for acquisitions as we explained here, plus the payment of dividends. So basically, these are the main financial metric, if you will, representing the situation -- financial situation in 2025. You can see here the net debt bridge of the net financial position now to be as tangible as possible. So the MFD and 24 were EUR 336 million. EUR 113.5 million, a positive impact on EBITDA. You have to include M&A, net effect of 42 million indebtedness with a positive effect because of the acquisitions. So we saved around EUR 6 million. We also have the growth of the net working capital of EUR 30 million. We have taxes. There, we have CapEx or intangible CapEx that we see investments on software programs. We have the tangible CapEx. This is due basically to investments for the Thailand and [indiscernible] hospitals, so the infrastructure, we are working on today. We pay dividends. And you can see here the net financial position. Now this means that the MFD, once again, at the end of the year 2025 was EUR 396.4 million. So what is now the progression we expect? Well, first of all, we're very happy of the way we closed the year. 2025 was also a year with a big change versus our externalized growth strategy. So we grew by internal life. This is we had to revise the entire organizational model, and this process is still going on. So you can imagine, we have to keep the speed or the growth speed -- even if we have to go through allocation topics, the reallocation of our resources, in order to improve performances at the same time, improving effectiveness. This is why we've created our direction, taking care of processes. We are such a, let's say, fast forward or a quick-step company. So the old, let's say, block diagram, if you will, is not longer feasible. So we are considering ourselves as a process. This means that we will generate more and more integration. By the way, this is most happening, plus more synergy for the entire value chain that we can express. As I said before, we're talking about organic growth. But of course, in our pathway, if we see good opportunities, which are once again in compliance are the targets, well, of course, we will be ready to seize them. Well, this is basically the list of takeaways of what happened in 2025. And these are the 3 main areas where there have been plenty of changes -- in our opinion, based on our numbers, the markets will still be growing. Thank you.

Marte and Andrea Fabrico Ventas. My name is Loren Soon, Investor Officer. And let me now read some of the questions we have received. And let me remind you that if you want okay, here, we have another pressure right now. Let me go through them sequentially. I mean some of them are being clustered together. Question number one, concerns from the news and the rumors of a possible GPI deals with funds. And the people want to know if there are negotiations going on and why. Well, I think Andrea is the best person to answer this question.

I do understand, I mean, the question. And in my role as a manager director, Well, no, we haven't had any information about this. So I'm not able to give you any insight about this.

Okay. Next question is for Mattel. So we have already talked about this in the presentation. So I'm talking about the results of the company, which are very solid together with positive perspectives for the future. Some people would like to have some more color on the outlook, 2026, what about -- is it going to be better or worse than the strategic plan? So is it possible to confirm 6% or up to 8% EBITDA increase in terms of CAGR? There's a question on the main growth drivers for the margin. Is it a mix? Or is it a price issue?

Okay, then. So let me start with the current solution. As I said before, if you want to imagine our results in 2026, well, definitely, we will be able to reach the objectives for 2029 because we have a medium to long-term outlook. So even slightly better than our expectations. This year 2026, well, we will take advantage of efficiency measures. We started in 2025 with some months delay. And in 2026 in January, 2 months ago, we have decided to have of reorganization and the consequences of this in terms of efficiency and effectiveness will concern the rest of 2026. So once again -- can I have the second part of the question, rent please?

The main drivers in terms of growing the margin. So is it a mix between our business units or strategic areas which is what Andrea Di Santo told us before? Or is it a pricing issue?

Well, it's different lines. So of cool, they depend on the various markets in which we sell our products. Product focus allows us -- I mean, to have expectations or expected margins, they should be higher. We know that the market is now becoming cheaper. So once again, pricing an important lever. The point is not the care and software synergy because as for care, we are sure that it also represents one part of the future of the company, but most of the company will give answers to plenty of questions, so let's say, proud out of full plenty of demand. which is growing. Then we have the product, then we have to be more effective in integration processes because synergies will also be important. Thanks to them, we will increase the margin that in the 2029 target. Thank you.

Once again, another question for Matteo, our General Director. Now this question maybe was already answered. I mean during the presentation of results, but some color on the already one concept is, are we in line with expectations in terms of contracts we are signing? And do we have no import and tenders coming up? Okay. So we have 2 questions. Then there's another question on the National Recovery and Resilience Plan, PNRR. So what about the centers? Are we on track? And do you know about any new -- I mean, coming nonship tenders?

Well, I'm considering, I mean, as a perspective, the future market, okay, because the question has to do with perspective for growth. As I said before, yes, there's a plan. I mean, a list of tenders has been published by concept with all of the time windows. And very clearly, we will see old investments that would be made. So all the tenders and again, all the time windows of the deadline. Now as for the previously assigned tenders, as I said before, there's sort of slowdown or delay. This is why, well, on the table, we still have EUR 1 billion to be allocated and this is an addressable market. Thanks to some internal estimates, just by imagining, I mean, the possibility to reach; I mean, the part of the business is still to be addressed. Also considering our estimates on the tenders winning rates well, a big chunk of that then may turn into a tangible opportunity as well as what we have already done for previous tenders. So they are being managed because ehealth is lagging a little behind. [indiscernible] is having some delay. But I have to say that we are in line with the time window, I'm sure that there will be quite a big backlog for the next year. Some people say that the NRR is closing, so the National Recovery and Resilience Plan, plus general politics, maybe markets will go to the military equipment business. So we know what the difference is between PNRR and tenders, but maybe you want to give us some color about this. So as again, PNRR and curing markets, right? The PNRR.This is not a hedache because what is happening this year, there's a deep, strong digital transformation migrating health to eHealth. This is based on PNRR. So the pathway has not been completed then. So when concept publishes tenders, in Italy basically procurement is quite centralized. Well, there are also other forms, for example, the cohesion funds at DSM, I mean, we do also have other channels. But once again, cost is funding tenders independent from PNRR. So PNRR into [indiscernible] and [indiscernible] already published. Some of the PNRR was a springboard. But once again, the money has already been allocated. And this was the money required, I mean, to guarantee this transformational pathway. Once again, PNRR has no impact there Our market analysis made by an independent company, well, they are confirming that the growth is currently in the next years or so. Health is now a political point that we know that this will be a very interesting sector or industry. After the pandemic, I mean, we now know what happened? I mean, well, the economy just stopped. So the point is absolutely interesting, and this won't be an interfering problem in the future. So together with the management, with the top management, I should say, together with consultants well, we carry out analysis. Right now, there's a key reference to the Gulf war, so we are in Qatar United Emirates and Saudi Arabia. In the Emirates, so we take 300 hospitals. I mean, we have our international director say that there's no slowdown. Conversely, our local partners confirm the targets. So there was a recent meeting that we had past month in February. Well, we keep going on with plans of no interference. In terms of the [ military ] expenditure, this is not a trade-off for the health market.

You mentioned foreign countries. 2025 has generated very import proceeds for GPI, I mean, foreign markets. So there are questions on a possible acceleration on foreign markets in 2026 with GPI.

Okay, for Martell. Well, the short answer is, yes. we say that the 2025 trend was growth so a double-figure growth. Now this is a trend that will continue. -- in 2026. So we keep at maintaining it right now. So the expectations for 2026 results say that there will be a strengthening of the international business. The total incidence is going up. So incoming all the stack confirming this, -- so we expect that we will hit on the 2026 budget.

Now let me share with you a follow-up. Can you give us some color on AI, which is what we have partly done during the presentation. We talked about this. But of course, this is the buzzword that you have mentioned, domain, can you tell us more about domains and AI, so the impact it tends on software programs, especially on health care and diagnostics?

Well, let's say that they are accelerators of the outcomes. So of course, I'm talking about an industrial perspective, but would like to implement AI agents just like motors that have to be installed on top of our software programs. Of course, we need to have the API, so the possibility to receive data. This means we will speed up I mean, the operation of that kind of engine, so predictive, generative, well, AI. So on the customer side, I just see advantages on the -- I mean, so patients, I mean, customers. We would be able to cut costs. So the total cost of owner TCO will go down, In terms of direct costs of the orders. I mean, the suppliers in in that case, the short tenor would be no, because, of course, we also have to pay investments back. So the point is exactly on pricing plus AI, it's a very wide scope because I, of course, but it also says all what we do as a company. So all one do is perceived in terms of value. For example, why managing the agendas, I mean, for 1 region on behalf of the general doctors. So we have, for example, 95% saturation factor. Well, going up to 96%. So 1% gap in terms of costs for health well, they save a lot of money. So we have to be able to make sure our customers understand that the price is not just due to this technology the price is also due to the advantage, I mean, the consequences or the impact that this will have. So I am sure AI will help customers. And hopefully, we will also be helped by AI. So this is the kind of tone of color I'd like to share with you. Maybe Matteo has something else to add.

Yes. this topic also has to do with risks. We were talking about pricing before. We said that the market is now -- has to consider a very high level of competition on pricing. So we have to innovate. We have to have the price that's really represented the value of what we offer. When talking about NIS or cybersecurity, what part of the risk? I mean, what's the value of the risk that we are able to keep that at bay? Our monitoring activities can not really pleased to remove risk of maybe 95%. For example, we just think of the value of some downturn, for example, when you have to stay close for months or maybe for 1 year. So they also have how state the center. So what are the costs of this risk? The real topic is that in this market, we have to make sure people understand that the value of software is a predictive value. So this is due to the benefit of advantages. It gives us in this very specific case, I'm talking about safety and security, plus IT support in terms of reducing risk. So we need to work on this. And this is what we have to share with the market.

As for foreign markets, that's a fresh question, where do you see the biggest growth in foreign markets?

Well, we know that we do have some dedicated areas, so to say. Now it depends on the time window you take into account. In terms of organic growth, France, if you will, is the market we best address because then you have links with the French speak in African countries. So in absolute terms, I would say, France, then in percent rates, there are other geographies or other regions or same South America. So they have percent rates which are higher. On a long-term basis, I think the driver would be the U.S. or I should say, Americas, not just in the U.S. Don't forget we are very strong in Mexico, for example. Of course, in terms of short term, I would say, once again, France and no doubt.

The last question is concerning the other ASA, excluding software. For example, there's a question on automation what the automation plans. Are you considering a spin-off? This is what we said during the industrial plan presentation. Maybe we can repeat this all about the margins in ICT and Lars Bertolet? We Think we have to stick to the plan. So a flat growth -- so we don't have the intention to push on the ordinary growth, so to say?

Okay, I can take this. As for automation, as I said before, what we are responsible for a business, of course, our target is having the best performances. Last year, there was an underperformance due to supply chain problems tax policies that had been announced, for example, tax credits for customers but also the fact that the account item would be published. It has just been published EUR 1.3 billion, and this has to strengthen the commercial activity that we have the costs of the commercial activity, but we will see the results of this year because the pipeline is very interesting. So if the tender is approved that the market will become a big, big market. And once again, of course, we need to take into account that this situation with the, I mean, tender, again, the duration will be 18 months. that customers having the 18-month agreements will be able to sign contracts up to 7 years. So this being said, we will strive our best to make sure these investments will increase also in terms of talent. But of course, there's a fill rouge linking this to the software program because we know about the accuracy of prescriptions, accuracy of drug production. These are very important elements. And again, this is basically under the logistics umbrella. Well, if there are opportunities surround the corner, we will take them into account.

Okay. Back to M&A. There's a question on what guided -- let me read another question concerning the M&A structure. Can we give some color on the pipeline we have? So what are the cash outs for 2026? Together with M&A, what has guide decision to take over a [indiscernible]? And as for [indiscernible], can we give some details of the impact of this position. I think this is for Andrea.

Okay. The point is the M&A pipeline. So why Logiprem-F, right? And then impact on logical Okay. Just to summarize the question. Well, as for the pipeline, of course, we do monitor the market. We have a very clear strategy. And proactively, we don't want to go to the market. But of course, we do see opportunities in a very opportunistic way. In those cases where we have the right opportunity in line with our targets. So this includes the Logiprem-F because it has business content, I mean, the product, of course, well to the market, if you will, that they are positioning, I mean, which is absolutely consistent with the critical care suites. It was the only missing piece of the puzzle in critical care, okay? So the neonatology this is what we were missing. So out of 100 Well, we just missed the 1 tile of the puzzle, if you will, and it now fits into the parcel. This French company is a very interesting 1 because they have prescription logics on internal database of a drag description. This is very fast-paced. -- disease intensive care. So timing is fundamental, effectiveness is important. And so this is another application of AI in neonatology -- this means that mistake rates were going from 13% to down to 2%. So it is a big impact on the quality of life of patients.

And as for the financial impact, so once again to see the economic and financial impact on our net financial position. If I'm not mistaken, it's around 1 million. So this is the number you will find in the financial statements. We don't see the economic impact because the take op has been done after mid-November. So it is not in the financial statements. we will see it start in 2026.

Okay. This is the 3 final questions. The first 1 is expectations 2026. Then in terms of financial charges, what can we expect for 2026? And last but not least, what are the actions that we are implementing to improve our cash flow generation? First 2 questions for Matteo. The last 1 for Andrea.

Okay. Okay. CapEx and financial charges in 2026. So we want to be in line with the plan. So 7% is the number. So this is what we would like to hit the growth is due to the investments that we imagine. So also on these intangibles -- so this is the general expectations once again, investing to improve the productivity of all of our solutions in terms of financial charges. Once again, as per the plan, I don't have the numbers here. We were trying to keep doing this of reducing the debt EBITDA ratio. Last question for Andrea.

Cash flow generation without the actions we are implementing to improve them, don't want to sound political, but all the actions we are implementing have to do with cash flow generation, including the organization. quite recently, we have created new functions the Chief Process Officer, CPO. Now this function, apart from the name, will have acute target. So improving processes once again because they are the foundations of our organization. Those processes are offered order and order to cash -- so all that cash is the process. We would like to shorten to streamline the timing basically at this mass cash flow generation, which is possible the ultimate target. But I have to say as well, that every single activity that we are implementing is highly targeted. So the only target is cash flow generation. Well, I may have thousands of examples for you in terms of process, in terms of organization, Matteo, do you want to follow up on this question?

Well, the foreign foreign market represents the cash flows at the point here Well, it may sound unimportant. But in terms of payment terms are broad. So this is different versus terms and conditions that we have on the market in terms of health care, especially in the health care, but also in other sectors.

So it's a cluster of actions that we are implementing that's helping us to generate cash flow in order to not only increase but also improve cash flows. Okay then, as I said, I really would like to thank the 4 managers for presentations, so there are no other questions. So we can just thank the listeners and see you soon for the next event and especially have a wonderful Easter break. Thank you.