NHOA S.A. (NHOA) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to NHOA Group Investor Call on Full Year 2023 Results and Q4 Trading and Operational Update. The investor call will be opened by Carlalberto Guglielminotti, NHOA CEO; and with him, to explain all details of our financial results, Alessio Caruso, NHOA Group, CFO. They will also be joined by Giuseppe Artizzu, CEO of NHOA Energy; and Stefano Terranova, CEO of Atlante. Guglielminotti will open the call with the main achievements. We will then go deeper in the results by business unit, finishing up with an in-depth financial analysis by Alessio Caruso. At the end of the presentation, the management team will be available to answer any questions you may have. Please note that this investor call will be recorded. If you could not attend the whole call, the webcast and the presentation will soon be available on our corporate website on the dedicated page. [Operator Instructions] Before we begin, I just want to point out that any forward-looking statements made during today's call are subject to the risks and uncertainties mentioned in the safe harbor statement, which is included on Page 3 of today's presentation. This also includes the risk that the transactions discussed during today's call remain subject to standard conditions for this type of transactions as well as any other risks and uncertainties associated with the execution of transactions of this type. And as customary, the call will be governed by that language. So with that, I will now leave the floor to Carlalberto Guglielminotti. Please, Carlalberto, the floor is yours.

Thank you, Chiara, and good morning, everyone. I'm very honored today to be here with you to talk about our results, the results of the NHOA Group achieved in 2023. And let me tell you that these results are once again a record breaking with over EUR 270 million revenues at group level, up 65% year-on-year and, most importantly, positive EBITDA at EUR 3.8 million, excluding the Atlante perimeter. But before talking about that and taking you through our financial and industrial results, let's take a look at this short video, which give us an overview of the milestones we achieved this year. [Presentation]

I hope you appreciate this video, which is really just a summary of what happens and looking back really helps understanding everything we have done during 2023. And let me take also the opportunity to thank our extraordinary people who made it possible and made it happened, our 540 people, 41 nationalities, working all together with one mission: Taking the energy transition to the next level. But let's now go through the slides to give you a picture of our industrial achievements and the biggest quick snapshot of our financials that we will then deep dive with Alessio. NHOA Energy, this year and also including last year, especially in a couple of years, we installed more than 10x energy storage than the capacity we've sold in the first 6 years of our life after the IPO. This gives the magnitude of the effort and the magnitude of the industrial growth that we have been able to deliver to the market globally. And when I say globally, if we move to the next slide, we clearly see our continuous global play. When we say that we are installing systems in 4 continents, this picture clearly represents our global footprint in 4, 5 continents with a restless effort in all of them, with all the different peculiarities of this market, which increased -- and increases significantly the complexity of running this business, but certainly the pride of having being able to do it. Then this lends to our results, so over EUR 200 million revenues, 1/3 up compared to last year. EUR 30 million gross margin, most importantly, EUR 7 million EBITDA. From a development perspective, close to 900-megawatt hours online and 1-gigawatt hour under construction as said in 4 continents. Then moving to Free2Move eSolutions. Free2Move eSolutions went last year through a significant turnaround in terms of management team, in terms of business model, most importantly, in terms of relationship with our partners, Stellantis and the respective brands. And I think that this figure represent the success of this turnaround and the tremendous efforts that has been put by the management team to restart our venture with Stellantis, and eventually to prove to be successful. Because 13% penetration rate within different brands and compared to just 3% in the first half is an absolutely exceptional results. That gave us the possibility to book over EUR 60 million revenues, 6x compared to last year; 24%, EUR 34 million gross margin, 25x up compared to last year and EUR 5 million EBITDA compared to minus EUR 20 million booked last year with an additional EUR 24 million of backlog. EUR 24 million of backlog that if we move to the geography breakdown, we easily understand, it's mainly driven by the United States business. United States business that this year has played a major role in our results, while Europe was progressively rounding up quarter-after-quarter. And in U.S., we essentially electrified all Stellantis dealers. This is a process that continues and will continue over 2024, and that's the reason why we still have a significant amount of backlog. But the positive news is that our European business, which is mainly related to residential charging devices to Stellantis customers is, as said, progressively ramping up quarter-after-quarter, and this give us clear visibility on our ability to continue the growth path quarter after quarter with Free2Move and, most importantly, with continuous profitability and path to profitability. We move to Atlante. Atlante, I think is well represented in terms of growth by this slide. This slide represents that we almost doubled and more than doubled technically. Our network compared to last year with already 1,800 points of charge, mainly fast and ultrafast online in our 4 countries. And we clearly see that our network is well diversified and well concentrated in the most intelligent places given the footprint and the different -- the geomorphology differences of the different countries. So we clearly see in Italy, a concentration in Northern Italy, which is the industrial area where e-mobility is more developed. While in France, for obvious geomorphology reasons, the network is more spread. The Spain is a bit behind and Portugal is well advanced. And if we look to the figures, this shows clearly that we invested significantly in Italy. While in Portugal, given the size of the country GDP and the millions of people we have out there, I mean, these figures is in line even if you see a very big concentration. And while in France, it should certainly increase our effort given particularly the very high penetration rate, the benefit that we have experienced. Last, but not least, this turned into a utilization rate, which is not particularly exciting from the profitability perspective and from the revenue generation perspective, and this is an absolutely normal parameter that's above the market average in any event. So this is a good signal that we have invested in the right places. And this is also coupled with a very high occupancy rates in Portugal. I mean we do have the network. We are investing in the right direction. Our utilization rate is above the market average. We have just to wait for a significant improvement in EVs sales penetration in our 4 markets, but we still have full confidence on the fact that it's going to happen very quickly because of the major changes at the carmaker level at a global scale. Then these results have been generated by our people. Our people that have grown significantly in the last 10 years. We are today over 540 people, but most importantly, the quality of these people is unparalleled. You clearly see the number of trade secrets and patents we have, the number of engineers, so 10% with a Ph.D. typically in electrical engineering and a very diverse population of 41 nationalities. This diversity has generated the results, and this quality has generated these results. Quality and diversity is also from the women's representation perspective, and we are continuously increasing the number of women engineers within our teams, and we are really proud of the effort we put in valorizing and attracting talented women engineers from all over the world. And that's the reason why we published our people strategy this year -- last year, sorry. We have been one of the first companies worldwide to publish and disclose our people strategy, our values, what we want, what we expect from our people and in order to give them the levers and the right mood in order to work in this direction, we have launched alongside with Family Working program, that we launched in 2020 in the COVID period, we launched the NHOA Elite program, which is unique and without any -- with an unparalleled, let me say, effort. The NHOA Elite program, which is representing the way we believe our people should be treated. So we invested significantly in physical well-being, mental well-being, performance optimization with ambition to create within -- at all levels within the NHOA Group Elite leaders in their respective fields from the professional perspective and most importantly, from the personal perspective. This is a unique program. By the way, the cost is very limited because this is below 1% of our HR cost. But this is our weapon to secure attractiveness from NHOA global scale, to secure retention and to valorize our people because when we say that we do care about our people, we really believe in and when we say that these results are thanks to them, we really believe in them. That's the reason why we give back to them one of the most advanced well-being program all over the world. Then having said that, these turned into results at group level, most importantly, scaling profitability. On the growth perspective in 2023, we have made more revenues than in the first 7 years of life of the company, more than the double technically and very close to 3x the revenues generated when we were EPS and then ENGIE EPS until essentially 2022. This well represents the step change we have made in these years and in the last couple of years. And if we look at the P&L, the P&L clearly represents that because we do have today both NHOA Energy and Free2Move eSolutions running fast, growing in terms of sales, in terms of gross margin, in terms of EBITDA and eventually even at the group level this year for the first time in our history, reaching breakeven at group level. So all in, obviously, excluding the Atlante perimeter, as Atlante is a totally different business model. That's an infrastructure business model with totally different value and a totally different play where we are on track towards our 2025 targets. Then last slide, this turns into a big question. So do we have the resources? Do we have the financial capacity to continue that path? And the answer is, yes. Because we raised, in 2023, EUR 250 million rights issue that we completed successfully in September, thanks to the support of our majority shareholder. And most importantly, in 2023, we have invested over EUR 100 million, obviously, mainly in Atlante, so in the infrastructure business, but we have invested a lot also in terms of the research and development at Free2Move eSolutions and at NHOA Energy. Most importantly, on top of the EUR 250 million raised in equity, we are starting generating operating cash flows at group level and this year, we already booked EUR 3 million EBITDA. We do have also additional resources to secure our future growth because taking into account the cash and the available credit lines we do have, it's over EUR 250 million. EUR 134 million net cash, so all-in including indebtedness, and EUR 145 million guarantees credit lines available to NHOA Energy to continue winning projects all over the world. This, coupled with EUR 81 million granted last year, mainly from the European Union and Caisse des Dépôts to Atlante to accelerate the development, particularly in France. I think this clearly represents the effort we made in the last 10 years. It's 10 years of my tenure, as you know. And this path towards profitability that we have demonstrated already this year is the best way we have to start 2024 and to focus on our 2025 and 2030 targets. So Alessio, floor is yours for a deep dive of our financial results.

Thank you, Carlalberto. Good morning, everyone. So let's start from the first slide. As anticipated by Carlalberto, the group delivered in 2023 growth in revenues across all the businesses and improved the marginality. In terms of group revenues as of December 2023, amounts to EUR 273 million, which is up 65% compared to full year 2022. The increase in revenues is mainly driven by EUR 205 million realized by NHOA Energy with Free2Move eSolutions contributing for EUR 65 million to the group consolidated venues, of which in excess of EUR 54 million coming from the new U.S. company. Atlante closed the year with revenues amounting to around EUR 4 million. The total revenues falls, therefore, in the high end of the guidance that was set at EUR 220 million and EUR 280 million -- in the range of EUR 220 million and EUR 280 million and then revised upwards from EUR 250 million to EUR 280 million. In terms of geographical breakdown, revenues are coming from Asia Pacific for around 65% that compared to last year 70%, 80%, confirmed a more balanced fleet towards U.S. and Europe, mainly driven by the eMobility business. EBITDA at group level, excluding Atlante, turned positive this year, standing at around EUR 4 million. Free2Move eSolutions exceeded the breakeven point, posting a positive EBITDA of EUR 5.1 million, with strong contribution coming from the U.S. market. NHOA Energy, more than tripled its EBITDA compared to last year to EUR 7.5 million, falling in the middle of the guidance range that we gave. At group level, including Atlante EBITDA stands at around minus EUR 14 million, highlighting a significant improvement compared to last year, EUR 33 million negative. The improved profitability is represented by a higher gross margin of around 20% this year, which we have to compare to last year 9%. The increase is mainly driven by the increase both in energy storage and eMobility businesses and also by a better revenue mix due to the growing volumes of Free2Move eSolutions and Atlante that are positively impacting and improving the gross margin at group level. As of December 2023, the group can count, as anticipated by Carlalberto, on more than 540 people, which is an increase compared to 450 of last year. The strengthening in the workforce is mainly due to the consolidation of Atlante around their 4 geographies and to NHOA Energy's global growth across the hub all over the world. If we compare to last year growth in the headcount, that was 90%, we are showing that we are reaching our operational setup at group level. If we move to the next slide, we have a look at the capital investments this year were EUR 101 million, which is up significant growth from last year, EUR 42 million and largely as anticipated, comprised of investment in the rollout of Atlante network, which represents 75% of the total group CapEx. And the other second important item is, of course, the R&D investment that amounts to around EUR 11 million this year. In terms of net financial position, has been significantly increased, respect in compared to with last year, mainly due, of course, to the successful completion of the capital increase through the Fall 2023 rights issue offering. The cash position overall at group level amounts, therefore, to around EUR 239 million, which is significantly increased compared to last year, EUR 47 million. If we move to the next slide, we start deep diving into the businesses. So NHOA Energy, in 2023, closed the year with a growth of around 33% in revenues amounting to EUR 205 million. This is mainly driven by projects in Asia Pacific, so namely in Thailand and Australia as shown in the geographical breakdown in the slides, which represents the main contributors to full year 2023 revenues. During the year, NHOA Energy has been also commissioning 9 projects, bringing the operational capacity over 800-megawatts hours. In terms of gross margin, we stand at 14%, which has significantly increased compared to last year 9%. So overall, NHOA Energy confirms to be EBITDA positive and reached EUR 7.5 million in 2023, which is 3x last year EBITDA of EUR 2 million and fall within the guidance we set between EUR 5 million and EUR 10 million. In terms of capital investments are, of course, mainly focused in R&D, which as said, what we show in the slides in the top right hand. If we move to the next slide, we can have a look at the backlog. The backlog is EUR 205 million this year. The drop that we see compared to last year is mainly explained by 2 factors. The first and foremost is the decrease in system prices which is, of course, beneficial for prospective volume, but still impacting the backlog figures. And the second item is the different portfolio mix with related party contracts compared to last year. Looking at the pipeline, NHOA Energy remained stable over EUR 1 billion, 6% across Australia, Asia and Latin America and Europe, and also is currently short-listed in 4 projects opportunities. It's important, I do a step back on backlog, the geographical split, which is more towards Europe, so in 2023, Europe represents 70% of the backlog. In terms of people, of course, the team has been expanding its footprint and established 3 new subsidiaries in Taiwan, U.K. and Spain this year to announce its engagement with local markets. So this is the explanation of the growth we have in the headcounts of the energy storage businesses. Moving to the next slide that is focused on Free2Move eSolutions. The group business unit dedicated to eMobility, we had as anticipated by Carlalberto, a very positive 2023, delivering the turnaround of the businesses. Revenues indeed reached the EUR 65 million, up 5x compared to 2022. That's mainly due to the successful electrification of the Stellantis dealers in North America. In excess of 22,000 of Wallboxes and EVSEs have been delivered during the year. In Europe, we have the acceleration of the penetration rate within the Stellantis portfolio of electric vehicles that increased from 3% of H1 to around 13% of Q4. Whereas in the United States, we successfully provided a comprehensive support to Stellantis dealers in the deployment of the fast charging solutions. In terms of gross margin as well, the business showed an improved marginality, up to 36% this year. That allowed the EBITDA to be EUR 5 million positive this year with a strong improvement compared to last year, EUR 19 million negative. Free2Move eSolutions has been investing also this year, around EUR 11 million and mainly in R&D while reshaping the activities and the team due to a refocus as promised and delivered during 2023. Moving to our last business unit in terms of flow, of course, Atlante. We can show revenues for EUR 3.7 million this year, mainly splitted between Italy and Portugal in terms of geographies, representing a 5x growth compared to last year. EBITDA, of course, still reflects the startup phase of the company and in its investment in terms of people, technology and tools required to build up the platform coherent to the Atlante's targets. In terms of investments, if we move to the next slide, which is probably the most important KPI to be shared. Atlante invested around EUR 80 million, which is a huge increase compared to last year, EUR 19 million. Of course, it has been largely driven by the rollout of the network that we have 81% related to EVSE infrastructure organically deployed and 14% related to acquisition. EUR 65 million represented in the lower part of the slide, divided in 59% on EVSE online and 41% in EVSE under construction. The organic of the team has been growing accordingly as anticipated, reaching the 145 people compared to around 90 people of last year. This is the presentation in terms of figures. So I give back the floor for the Q&A or to Carlalberto.

Thank you, Alessio, Yes, I think we can start with the Q&A session.

[Operator Instructions] We now already have a question coming from Mr. Alessandro Pozzi from Mediobanca.

Yes. Can you hear me?

Yes, perfectly.

Okay. Thank you very much. So first of all, I think it's good to see that your results are within guidance, both in terms of revenues and the positive EBITDA, excluding Atlante, of course. But also, I was wondering, as we look at 2024, whether you can provide any color on revenues, EBITDA, and potentially CapEx? I think that will be quite important for investors to know how the company is progressing this year. The second question is for Carlalberto and Giuseppe. I believe I think your mandate expires in 2026. And I think in light of TCC having 90% of the share capital of the company, I was wondering where you're still basically willing to lead the company into the next coming years? That's all for me.

Alessandro, I'll take the first question and then I hand over to Giuseppe for a detailed explanation. But the reason why we have not yet provided our guidance is simply because it's too early. This year, we have approved our financial statement significantly early than any other year in our history. So we are essentially in the third week of February. We're going to have more visibility in the coming weeks and months, and we will certainly give the market more color on that. In terms of growth, certainly being the positive thing is that even if our results will be just in line with last year results, I mean, you already have the confirmation that the group is EBITDA positive. We're not burning any more cash. We have been able to deliver great volumes with the right capacity to provide profitability to our investors. So we will have more visibility as said in the coming weeks. In terms of revenues and EBITDA. Again, even assuming a decent growth, I think this gives the market already a good level of confidence on the fact that we use the money we have raised that we invest in the network, while the other two businesses are cash flow positive and running by themselves. Then in terms of CapEx. As you can see from our 2023 financial statement is mainly driven by Atlante; therefore, the CapEx for 2024 will be in line, I think, with the levels of 2023 and the rollout of Atlante will continue according to the plan towards the 2025 guidance. Then specifically on the energy storage, which is the main contributor of our revenue at group level, the fact that it's too early to comment in terms of volumes, in terms of market, there is a strong rationale behind, but I leave to Giuseppe to deep dive on that. And then I take the second question after Giuseppe, sorry.

Thank you, Carlalberto. So from a stationary storage business perspective, as you know, our projects have on average 15 months -- of around 15 to 18 months to convert in revenues. And we start generating revenues within the first 6 to 9 months significantly because we have battery delivery. So contracts on which we are shortlisted or preferred bidder now are relevant with respect to our 2024 results. So this is the main reason because it is a bit early. We need to see the important opportunities we are working on these weeks, whether they convert or not into backlog because that triggers then a significant impact on guidance. Having said that, just another comment from a color perspective, you've seen our backlog evolution just to give a bit more color on what Alessio said. So this has been a transformational year from a commercial perspective. The first reason is that we are completely -- so you saw the complete change in the mix between revenues and backlog, so Europe has eventually taken off. And we have a very significant, much lower contribution from Asia, which was related-party business. So there are 2 good news in this. The first one is that over the last 2 years, we have essentially managed to completely become commercially independent. So we do not depend on related parties, which is, in the sector, it's quite an unusual feature. So it's an entirely non-captive business from now on. Of course, we would welcome further projects from group entities, but that's the nice upside. In reality, we are completely commercially independent. The second element is that eventually Europe is waking up. It's not only that we enter the U.K., but there are a number of other countries, and there were going to be a few pieces of news coming out over the next few days in this respect. The second point on market is that with the same volumes now in economic value are almost 1/3 lower because battery prices have plummeted in the second half of last year. This is something that -- it is from a market perspective, from a business case perspective, is great because essentially, it lowers the bar very significantly for our clients in terms of having remunerative business cases on their projects. However, it takes time for that to fit into, while the impact on backlog is immediate because it affects immediately the project that we have just closed, but also because even the project that we already had in backlog are price indexed. So automatically, we have a reduction in backlog. So it is an optical element to be kept into consideration. The last point instead is an element of caveat. This dramatic price decrease, it is also -- makes it for a complex business environment because on one side, we are literally submerged by incoming calls from clients on multiple markets that expect these kind of prices. On the other hand, these kind of prices are driven by what is clearly a price war in the Chinese battery market, in the cell market, and this is dangerous because it creates counter-party risk. So we are a technology company that deliver as a contractor. So we are exposed to the performance of our supplier. So one side, we are extremely happy that our system costs much less because batteries cost much less. We are not that happy that we are an intermediary for batteries that are generated in a sector that is undergoing a profound price war. We are -- we were here already 10 years ago when the same happened in the solar sector, and that was painful. So this is something on which we have to be careful and selective in risk management over the next several months, possibly next 1, 1.5 years.

Okay. So probably, still too early to say whether EBITDA for the division can increase year-on-year. I guess there's a lot of potential opportunities that can materialize and become revenues in '25 rather than '24?

Yes. I mean also -- I mean, there's also an impact on '24, and this is why we are not -- it's early to give guidance. Of course, for '25, it's another story. We stand by the guidance that we have given back last year, so -- or the objectives that we've given back last year. Having said that, we are very happy of where we stand. But we have a cost basis, there is personnel cost basis that is largely fixed. So adding a couple of big projects has changed significantly in terms of impact on EBITDA. So this is why we are careful for a few weeks more.

Then on your second question on the mandate of the spend, I -- technically, our mandate was still the approval of the 2023 financial statement, but we are here, so don't worry. At least that's a good signal. And then, yes, under the control of Giuseppe, but we still are comfortable and willing to continue leading this company. The company with -- yes, 90% -- almost 90% owned by our majority shareholder, but let me say that my judgment on that is very simple. Irrespective of the shareholding of our company, what I look at is the level of support we have, in case of need in the past and, most importantly, also from the strategic perspective. Then from my point of view, we are absolutely confident and comfortable in running this business with TCC at 88% for the simple reason that TCC already demonstrated many and many times to be supportive of the growth of this company, to be there when needed, and to genuinely and strongly believe in what we are doing. So this is not a detail, the amount of funds and support TCC delivered to NHOA in the last years, most recently with EUR 250 million capital increase, but also on a daily basis with the strategic and financial support also to the business of NHOA Energy, to the -- within the global banking system has been [ with outlets. ] So we are absolutely comfortable -- absolutely confident that we do have the right partners with us and the right shareholder that is supporting our growth and supporting this company towards our 2030 plans.

Okay. Maybe I don't know if we have time to squeeze in a last one for you, Carlalberto. So in Italy, we've seen incentives going up for EVs, certainly positive news. But at the same time, it looks like the demand for EVs may not be quite there as expected maybe 1 year or 2 years ago. Can you give us your thoughts on that? And are you -- does it make you rethink the pace of the expansion drive on Atlante?

I'll make a brief introduction and then maybe I hand over to Stefano for a more precise comment on that. But let me say that I'm not shocked about the very disappointing results in Italy in terms of EV penetration for the simple reason that -- and by the way, the figure is 50%, 55%, okay? So if I'm not wrong penetration in Italy is of today is 50% lower than expected a couple of years ago. And -- but I'm not surprised because people particularly, in Italy, were expecting, like in many other countries, incentives and subsidies. They were not there for a series of political reasons that I don't know. And then given the fact that these incentives and subsidies, as you currently mentioned, seem to be there, I mean, this is going to change rapidly. Then from the broader perspective, but again, I hand over to Stefano for his feelings on that, from a broader perspective I can say that, again, in 2024, this will generate certainly a positive impact, but I don't really care too much because the big transformation will be when carmakers are going to launch it. And this will happen between end of 2024 and beginning of 2025, okay, according to my feelings when global carmakers will launch in the market, the new models, and these new models will be 100% electric. This is the game-changer, okay? So even if, as of today, the subsidy or the incentive may accelerate or decrease the pace of EV adoption, what really will change the paradigm is what's carmakers at global scale are doing. Because all of them have invested exclusively in electrification. And therefore, this is going to happen in the market and then with or without your positive or negative feeling, starting from next year, you're going to buy -- if you have to buy a car, you have to buy an electric car. This is, I think, the real game changer. But maybe Stefano can give us his view on -- a more precise view on that.

Yes. Thank you, Carlalberto. Yes, totally. I totally subscribe with anything Carlalberto said. First of all, yes, car sales in terms of BEVs, especially BEVs and also plug-in hybrids have been disappointing all across the board. If I look at our geographies, we have 2 markets where we did particularly badly, Italy and Spain, in terms of BEVs adoption. And two, where the damage was limited almost, I would say, still below expectations, but we're going to compare in France and Portugal. So the short term, yes, there are lots of reasons that impacted the choice of people buying a new vehicle. One of them certainly incentives. In Italy, I use Italy as an example, we had even preventive mechanism whereby the incentives were equal or at times may even felt better for non-BEV vehicles. And now finally, we have a package that seems to be really interesting for BEVs, still missing the final dots to be finalized, but okay. But that will, in a short term, bring some boost. But what Carlalberto said is very important because in the end, the consumers need choice. And right now, there is very little trust admittedly in terms of BEVs, especially for the mass market. All European automakers decided to go for the premium segment. Even in small caps, there are these small caps like the Fiat 500 full electric, which is a fantastic city car or small type vehicle, but it's quite expensive compared to other cars of the same size, let's say, but [indiscernible] ICE cars. So there is a shift which is happening. And we know that carmakers are all going in that direction. We are very close to Stellantis for historical reasons. So we know their plans, but not because we have any special insider information because we follow very closely all of the announcements they make. And therefore, we know how much of the production will shift towards full electric. And that's a path which is already designed, and it cannot be stopped because once you start converting your production lines, once you start converting these processes, then it's an unstoppable process. On the other hand, let's not forget that there are newcomers, especially from China that are native full electric automation, right? Right now, we have the example of Tesla. They created pretty much the market from scratch, but there are lots of other newcomers that will have a positive impact for consumers, for customers who want to purchase a new vehicle and will have the option to choose the electric vehicles. These delays, however -- okay, the impact is on the short term. But first of all, as Atlante part of the NHOA Group, another connection to work, Carlalberto said that bit early on, we have -- we are very fortunate because we have the full support of TCC that has injected capital into NHOA also for -- especially for Atlante, let's say. And it is an industrial player with long-term view, NHOA is an industrial player with long-term view, so we don't have, let's say, the very short term, I would say, strictures and pressures that we might have if we were backed by investment funds, especially in an environment where the cost of money has increased dramatically in the last couple of years. That does not impact us. Our strategy is clear. Our objectives are clear. In terms of do we delay our plants, not at all, in terms of deployment of Atlante. It is a long-term gain, so a couple of years of lower-than-projected bad sales will not affect our long-term strategy. We are, of course, we don't live under a rock. So we also changed circumstances, we will be more cash flow and watchful on how we invest, right? So we have already provided within the current plan to shift the sum of our investment, but that's internal kitchen of our plant, let's say, to do -- to go for more ambitious plants, for example, in France, where there are more electrical vehicles vis-à-vis other countries, just to give you an example. And also Portugal, we want to be a bit more ambitious since the growth continues to remain soft in terms of BEVs in the short term. And also, more generally speaking, because of the lower penetration of BEVs across the board, we need to be more selective on the locations, right? That was already kind of the plan. Every secure tries to capture the best locations. But even more so, the attention will be higher because of the BEV penetration being focalized and focused on certain areas rather than more mass market.

We now have another question coming from Mr. Auguste Deryckx, Kepler Cheuvreux.

Do you hear me well?