technotrans SE (TTR1) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. Welcome to our webcast about the first 6 months of the financial year 2022. My name is Frank Dernesch, and I'm responsible for Investor Relations at technotrans. Together with me are the members of the Board of Management, Michael Finger and Peter Hirsch. In today's webcast, the members of the Board of Management will present the business performance of technotrans Group in the first 6 months, the challenging external conditions, the current status of our strategy, Future Ready 2025, and the outlook for the rest of the year. After the presentation, Michael Finger and Peter Hirsch are looking forward to answering your questions. If you would like to participate in the Q&A session, please click on the Raise Your Hand icon, which you find on the Goto Webinar toolbar. We then will open the line for you so that you can address your questions to the Board. Please open your mic before you begin to speak. Alternatively, you can submit your question in written form in the field, Enter a Question for staff. For further information, please refer to the quick reference guide, which was attached to your invitation. Please note that the following presentation contains statements on the future development of technotrans Group. These reflect the present views of the Board of Management and are based on the corresponding plans, estimates and expectations. These statements are subject to certain risks and uncertainties, which could mean that the actual results differ considerably from those expected. Now please let me hand over to Michael Finger, Spokesman of the Board of Management. Michael, the floor is yours.

Yes. Thank you, Frank, and a warm welcome from me as well. I'm very pleased to report strong figures today. technotrans increases revenue and earnings significantly in the first 6 months. This is the headline of our half year report, and this is the key message after 6 months. And despite all challenges with supply chain, semiconductors, the COVID, the war, everything, the group has managed to deliver great results quarter-by-quarter. So let's take a look at our main KPIs. Group revenue, EBIT and ROCE have improved significantly compared to the last year. Revenue increased by 9% to EUR 140 million. EBIT moved up even stronger by 18% to EUR 6.2 million. EBIT margin reached 5.5% compared to 5% last year. And ROCE is at 11.8% being 1 percentage point up. As already mentioned, we were very pleased with this performance as the conditions have decreased significantly over the course of the year. COVID is still not over, and due to the Chinese Zero COVID strategy, we were faced with lockdowns in China. And after February 24, the world is no longer the same. The Russian war placed a massive additional burden on the economy. By consequence, the situation on the supply chain worsened. We are still faced with conditions -- with continuous price increases for parts and raw material and since a couple of months as well with strong rising energy costs. Inflation rates has increased significantly worldwide, mainly due to the rise in energy prices. This slide shows the dramatic development. The Fed and European Central banks are responding to this with interest rate hikes. In the middle of the slide, we can see that the economic sentiment is deteriorating. Growth rates are being revised downward. For example, the IMF recently revised the growth rate for Germany for this year downwards by almost 1 percentage point to only 1.2%. Quarterly GDP for the U.S. in the second quarter was at 9.9%, down from minus 0.6% in the previous quarter. And this means that the U.S. is already in a technical recession. In Germany, GDP of the second quarter was 0. In contrast to the U.S., we do not have a technical recession yet, but it shows the fragility of the economy as leading forecasting in institutes has expected a growth rate of 0.7% in this period. As a consequence, stories about the global recession are growing. These are all challenges we all have to deal with. And despite these challenges, it was really good to see that we could deliver what we've promised. Our energy-efficient thermal management solutions are highly appreciated by our customers in times of rising energy prices and high environmental orientation. Demand remains on a high level, and that, in all of our markets. We have still an excellent order situation. Our order backlog reached EUR 94 million. This is another all-time high. The book-to-bill remains on a stable level of 1.3%, a clear indicator for further growth. We have worked very hard to keep deliveries high as possible. As I outlined some minute ago, revenue rose by 9%. This is a great success from my point of view as getting the right components on times is difficult in times like this. Our employees did a great job, and I would like to say thank you to all of them. The great top line performance and our efforts to control costs are also reflected in the earnings per share, which rose by 18%, up to EUR 0.59. Of course, we also kept an eye on financial stability and financial strength of the group. Our equity ratio remains above 50%. Our leverage ratio remains fully on investment grade level. And finally, on this slide, it is important to say that we have increased our efficiency. We are doing 9% more business with less employees. So what are our key factors to success after 6 months and for the rest of the year? Let's look on some main highlights. Number one is our strategy, Future Ready 2025. We are 100% on track here. Phase 1 of our strategy is almost completed. We have achieved all important milestones of this phase already. And the internal mergers, we spoke about it recently in many calls, were legally completed. The umbrella brand is implemented and our balance sheet remains solid. We have turned the company around and have generated stability and profitability as scheduled. Focusing on key markets has already paid off. Our teams have managed the supply chain pretty well. Peter will tell you a little bit more about this in a few minutes. Order backlog and order intake are indicating growth and stability, as already mentioned. With EUR 94 million, our order backlog reached a new all-time high. And the book-to-bill ratio, as a consequence, is on a level of 1.3%. This underpins our ongoing growth trend and is even more impressive with regard to the revenue increase in the first 6 months. As a logical consequence, revenue and EBIT have increased significantly compared to the last year. And it's really worth to say, without the disruptions on supply chain and the risen corona infections, our performance would have been even stronger. So let's now take a look at some highlights of our markets. It was really good to see that the demand remains on a high level, as is for all markets, our products and our services. Due to the increasing environmental awareness and rising energy prices, more and more customers are opting for our thermal management solutions. In plastics, the acquisition of new business developed very positive. The expanded capabilities of the mergers between Reisner and gwk were very well received by the market. This results in further increase in orders on hand in both project and series business. We have increased revenue in the second quarter of 2022 compared to the first one, but continuing supply chain problems for owner-related disruptions and delivery start-ups led revenue shifts particularly in project business, we have shifted business into the second half. In Energy Management, we have expanded our market position in the area of e-mobility further by generating many new orders. Moreover, revenue picked up sharply in the second quarter of 2022. The great year-on-year increase of 36% indicates that we have started the ramp-up of series production of battery thermal management systems for 2 big great programs. In Healthcare & Analytics, the order situation developed positively in line with our expectations as well. However, the limited availability of core components mean that revenue was not able to follow this trend in full. In Print, we can say continued catch-up effects and the positive momentum in the packaging business characterized the development in the reporting period. The positive development, which we have already seen in the first quarter, continued. And with that, a significant year-on-year revenue growth of 16% was achieved. In the selectively covered market Laser & Machine Tools, where we have set our focus on high-tech laser applications, the high investment activity and the reduction of delivery backlog resulted in a noticeable revenue growth of 19% year-on-year. So due to the situation on the procurement market, precise production planning was not possible. This has led to revenue shifts in some areas. But important to know, there were no cancellations in the reporting period. So if we would match now the development in our focus markets with our assumptions from our strategy, we will see the following picture. We've met or overdelivered the CAGR, [ would linear resided ] in all markets. A remarkable growth we saw in Energy Management with applications for e-mobility, as outlined before. Our assumptions are very worried. We were again able to outperform market growth in all focus markets. We are fully on track. Let's move to the group financial performance in the first 6 months of this year. As I already outlined at the beginning, our main KPIs, revenue, EBIT margin and ROCE, were all above previous year and are fully in line with our guidance. But also the other relevant KPIs developed quite well. Gross profit rose by 7.1% to 38-point -- EUR 31.8 million. EBITDA increased by 8.3% to EUR 9.5 million, and EBITDA as margin was at 8.4%. Consolidated net profit increased notably by 18.4% to EUR 4.1 million. Earnings per share moved up accordingly from EUR 0.50 to EUR 0.59. Both segments, Technology and Services, contributed in the positive development in the first half together. Revenue of the segment Technology rose by 9.4% to EUR 85 million in the last 6 months. Profitability, that is important to say, increased significantly from 1.8% to 2.5%. It was good to see how the teams more than offset the cost deflation in commodities, rate and packaging through strong pricing execution. Share of the group revenue was 75% in the segment. Segment Services reported revenue of EUR 28.8 million, which was 7% up compared to the previous year. EBIT of this segment rose from EUR 3.9 million to EUR 4.1 million. EBIT margin reached 14.2% and was moderately below last year's level of 14.6%. This was driven mainly by a temporary delay in price effect. So what comes next in this important segment? We are digitizing the service. Proactive monitoring for upcoming service tasks become key to success for the future. And finally, who can do service better than the company who have provided the hardware. Our balance sheet and the financial position remains very solid. The equity ratio is on a comfortable level at 53.2%. Net debt rose by EUR 6.4 million to EUR 27.2 million compared to December 2021. Here, the continued increase in the business activity and precautionary stock building activities with regard to the supply chain situation are reflected. The leverage ratio expressed by a net debt EBITDA of 1.4 remains on an investment and grade level. Based on the strong business performance, the cash flow from operating activities climbed from EUR 9 million to EUR 9.6 million compared to the last year. And as already mentioned, buildup of inventories, the increase in receivable builds due to the strong business performance resulted in a negative free cash flow of minus EUR 6.3 million. But due to the temporary nature of the described net working capital development, free cash flow is expected to increase in positive numbers in the second half of this year. Overall, technotrans continues to maintain a high level of financial stability, and this is important in times like this. Finally, we are very pleased with the performance of the first 6 months of this year. Our strategy, Future Ready 2025, gives us stability and has made us more resilient. We are able to grow our business in challenging times. Having said this, I will hand over now to Peter Hirsch, who will explain in more detail the development of operations and our strategy, including sustainability within the first 6 months. Thank you. Peter?

Thank you, Michael, and good morning, everybody. Ladies and gentlemen, as expected, the challenges due to the economic environment increased again in the first half of the year, especially in the second quarter of 2022. A wide range of influencing variables is affecting the operational business of technotrans. Accordingly, the requirements regarding our organization have also risen further. Therefore, I would like to focus on 3 of these aspects of the prevailing external conditions, which are: the ongoing corona pandemic, the persistent tight procurement situation and the sharp rise in material components and energy prices. Let's start with the corona pandemic. So far, the pandemic has not been finally contained. Rather, the opposite is true. After 2 years of abstinence, public life is slowly returning to normal. Mandatory mask wearing has been canceled and the hygienic measures increasingly seems to be forgotten. It's no longer a question of if, but rather when one will become infected. Accordingly, the number of infection rates rose again. This was noticeable even in the technotrans Group. Within the second half of the year, we had more corona infections than in the entire year 2 years ago. Fortunately, these are usually cases that were entered from the outside and whose cause was harmless. Nevertheless, it puts a noticeable strain on the organization in terms of productivity and efficiency. Thanks to our experience and flexible production system and by the help of temporary workers, we were able to limit the direct effects and maintain production almost without restrictions. Far more serious have been still the indirect consequences of the corona pandemic on worldwide logistic change, which are still noticeable today. The Zero COVID strategy of China and the harsh lockdown, especially in the Shanghai region, brought economic activities to a complete standstill for about 8 weeks. International shipping were faltering again. Important deliveries failed, placing an additional burden on the supply chains and deteriorates the material availability. This leads me to the second aspect of the prevailing external conditions, the persistent tight procurement situation. The situation on the procurement market remains difficult. Components with electronic parts and metallic pre-products are particularly affected. For technotrans, these are especially fans, plate heat exchangers, speed variable pumps and control units. To date, suppliers have been unable to meet demand in full. In some cases, delivery times have increased significantly and now exceeds 12 months. Via proactive supply chain management and the selective expansion of the ordering horizon, combined with an increase in inventory, it was possible to continuously ensure delivery capability in the first 6 months of the year. The diversity of markets and products also increased resilience and reduced the risk of major dependencies on series business and the associated shift instead. Nevertheless, the relaxation on the procurement markets that was noticeable at the beginning of the year is over and the procurement situation has deteriorated again for individual product groups. Russia's attack on Ukraine in violation of international law has further exacerbated the situation as this was resulted in a shortfall in important raw materials such as aluminum or copper. In addition, the disruption of the new Silk Road and overflight bans significantly lengthening international transport routes. All this, has led to a significant increase in prices of raw materials, pre-products and components to which technotrans has responded immediately with a fair and transparent increase in sales prices. The sanctions imposed by the European Union against Russia and the reaction of the Russian government with a drastic cut in pipeline gas led to a sharp increase in gas and energy prices of more than 300% and had an additional negative impact on procurement prices. There is still no end in sight, especially as concerns about the stock of gas supply and the resulting gas shortage continued to drive the price. But what are the consequences for technotrans? First of all, technotrans does not have any significant business relations with Russia or Ukraine. Therefore, the direct impact on business is of secondary importance. Regarding the cost structure, we cannot escape the price increases either. However, the consumption of fossil combustor is limited to the vehicle fleet, the heating of the bearings, the paint shop and the [ train stations ]. Overall, consumption can be classified as low so that according to the latest information from German government, technotrans would be not affected by a shutdown. As far as costs are concerned, we currently expect additional costs of around about EUR 500,000 at group level, which has been priced in. Overall, we can describe the first 6 months of the fiscal year as challenging. Supply chain management and production planning were faced with high demands, which they countered with creativity and flexibility. Above all, looking -- forward-looking inventory management enabled continued sales capability and the prompt passing on of price increases ensured that the target for revenue and earnings were achieved. So far, we can be very satisfied with the development of our business in 2022 and are cautiously optimistic about the future based on our well-filled order books. You see technotrans handled these challenges carefully and with a sense of portion based on the personal commitment and expertise of our employees. Nevertheless, the actual global economic situation is still strange. The risk of a decline in investment activities due to a recession is still there and can have a far more serious impact. But from today's perspective, this cannot be reliably quantified. Therefore, for the rest of the year, we currently expect a continuous business performance within our guidance based on our order backlog. In such a challenging economic environment, the increased resilience due to our strategy, Future Ready 2025, is more important than ever. The measures implemented today have made the group more stable and increased profitability even under difficult conditions. In the first half of the financial year 2022, our strategy was consistently implemented. All measures went according to plan. With the legal completion of the merger of the group company Reisner Cooling Solutions with technotrans solutions and KLH Kältetechnik with technotrans, we reached a significant milestone to leverage group-wide synergies by increasing the efficiency of organization processes and systems. The renaming of all production sites within the one brand strategy highlights the new strength of the technotrans Group. Through a variety of measures, the group's profitability and stability improved sustainably and showed itself to be more resilient in a challenging global economic environment. In general, sustainability is an integral part of our strategy. In addition to optimizing our own energy consumption, we have intensified our efforts to make our customers and our own thermal management more efficient. As an example, technotrans presented the world's first 850-volt DC battery thermal management system for road and special purpose vehicles at the Battery Show trade fair in Stuttgart. The technotrans unit can be connected directly to the battery, eliminating the need for a traditional voltage converter, which saves costs, installation space, weight and failure risks and makes the application much more efficient. Finally, it helps to increase significantly the electric range of the vehicle. As another example of sustainable thermal management systems, technotrans presented at the Analytica trade fair in Munich, the first cooling unit for the laboratory sector that completely dispenses the use of refrigerants by an electrothermal principle of operations. On the way to reduce our own carbon footprint, we are focusing on 2 key aspects: the installation of a photovoltaic system in Baden-Baden and the reduction of fuel consumption in our company fleet. Unfortunately, both were impacted by the actual procurement situation. Due to missing parts, the start of the operations of the photovoltaic systems had to be postponed from the second to the third quarter. But then it will generate around 40% of the electricity used by this site. In addition, the current limited availability of electric-driven cars is hindering the transition of the technotrans car policy to alternative and sustainable vehicles. Accordingly, we do not expect to be able to implement increasing electrification until next year, but then with greater speed and consistency. Ladies and gentlemen, you see even under the current difficult conditions, we are ensuring the successful running of our operational processes, and we are pursuing the strategy fully according to the defined strategic phases. Within the last 18 months of the strategy, Future Ready 2025, sustainability and profitability of the group has improved already. Our sustainability efforts were strongly developed further. We are looking at a challenging time with increasing uncertainties, but we are as well prepared as possible. The organization has the strength to operate successfully even under difficult conditions and to continue our strategic path. This is what we stand for with our entire highly motivated team, for profitable growth together with our customers and investors. Thank you very much. With this, I will hand over to Michael again, who will give you an outlook and short summary.

Thank you very much, Peter. As you could see, technotrans has generated very good results in the first 6 months of 2022. technotrans has developed further as a result of the challenges we have mastered, and this is very important as there is currently no signal of any sustained improvement in the underlying framework conditions. COVID will continue to accompany us. The outlook and the outcome of Ukraine war is uncertain. And finally, nobody knows what happens in Taiwan. So what can be expected in the upcoming months? The supply chain remains a challenge. We can also expect sharply rising energy prices, high inflation rates and interest hikes, worries about a gas supply stop for Germany and uncertainty regarding an upcoming recession. But we can expect also trends which are positive for technotrans such as, an increasing electrification and increasing digitalization, decarbonization and raising efforts to become independent of fossil fuels. All this is in our favor. For all these trends, there is an increased demand for energy-efficient cooling solutions, for thermal management. There is a demand for technotrans. We have the right strategy, the right employees and the right solutions to cope with these circumstances, and we will capitalize on these opportunities. We had another positive news flow in the first half. We are extremely successful when it comes to winning new business. We have won many major contracts in all markets. Our factories are full. Capacity is currently what limits our business. Assuming that the economy conditions do not worsen, we anticipate a solid revenue generation in the upcoming months. And as a consequence, our guidance remains unchanged. We continue to expect revenue in a range of EUR 220 million and EUR 230 million with an EBIT margin between 5% and 6%. EBIT is expected in a range between EUR 11 million and EUR 13.8 million. The return on capital employed is expected to be in a range between 12.5% and 14%. Our midterm goals of generating organic revenue growth in the range of EUR 265 million and EUR 285 million with an EBIT margin between 9% and 12% in 2025 remains in place as well. So to sum it up, we have significantly increased revenue and earnings in the first half of 2022. We are 100% on track with our strategy. The figures have improved again after an already successful first quarter. The order situation reached a new all-time high and indicated further growth. We are very pleased with the performance in the first 6 months of this year and confirm the forecast for this year and our midterm goals. And with that said, I'll let Frank open the Q&A session. Thank you very much.

Thank you, Michael. Thank you, Peter. Ladies and gentlemen, the lines are now open for the Q&A session. So if you would like to ask a question, please raise your hand or type in the questions. So at the moment, I see 2 raised hands. The first one is Christian Glowa. Okay. Mr. Glowa, we will give you some minutes. I will go on to [ Johannes Ries. ]

Can you hear me now?

Yes.

Okay. Great. Maybe some short follow-on questions. First, you showed the breakdown of revenues, and you mentioned in some areas, you have held back by some supply chain worsened areas, for example, in Healthcare and how is the breakdown compared to the revenue in the order backlog -- on the order intake, maybe, post maybe, I found a feeling where there is a future growth there.

So in the order intake, the revenue is almost quite solid across all markets. There is no drift or shift to see. We only had the problems in some parts of our markets, as you could see, but this was related to the already explained situation. Most -- it comes out of the supply chain, and that had shifted the revenue into the next quarter, unfortunately. But if you look to the order book, that is quite well balanced.

Great. And on Healthcare, which was most affected, if I got it right, in the revenue side, do you see a catch-up effect in the second half?

Yes, we will see that. Hopefully, if we will not have another challenge to master in the supply chain, we will see that, yes.

Great. And on the Print area, on the other side, you are far ahead of your expectations. How sustainable this is close or what's happening on special effects in the first half?

Yes. I'm sure we can't continue this over years, this pace. But on the other hand, also the Print industry is developing further. If you look to the activities they are doing -- they are focusing on packaging business and how to deal with those new challenges, looking to online trading, online market. You need more and more packaging. There is a strong focus in reduced waste. And even there, the print industry is offering quite interesting solutions, and they are participating from those trends as well. And if they are participating, we are participating, too. We see also for the upcoming months a quite strong order book. But again, we have not built our strategy just on the strong growth of Print. If you look to the market development assumptions we did, in 2020, we forecasted almost flat. Now it's doing better. That's fine for us. But we are still also looking to the other markets, that is also our other 3 focus markets, and most of the growth is coming out of there.

Okay. I see. Funnily enough, you are really outgrowing all the OEMs like [indiscernible], so that's a funny thing. Any reason for this?

I'm sorry? What was the question?

Why are the -- maybe you are growing much faster since the other -- since your OEMs and your partners also at printing machine side. Is there any reason?

We are also dealing with the end customers and with other related print industries. But finally, as you know, we are the market leader. We have a market share in the offset and flexo by around about 80%. And if the market is doing well, we do well as well.

So far, you are more benefiting from the installed base instead of new business from the OEMs, yes?

I would say both. So we are winning new and we are participating from the installed base as well.

Okay. Super. Maybe, like always, it's my typical -- my traditional question. You didn't mention it, but this is new markets outside the traditional, maybe like a cooling of data centers and the spraying business for the bakeries and things like this. So if you can update -- is the positive development has gone on in this segment -- activity?

Certainly in those mentioned new markets like food industry and data centers, we are progressing quite well. For the food industry, I think we've published a press release where we've won business with apetito, a very well-known company in that area. We sold a very, very broad and a big spraying system to this company. And as this is a very big customer in that area, we can effect hopefully more in the future. For data center, is the same. We are making progress in a lot of areas. As you know, we are working with one strategic customer for data center cooling solutions, where we've made good progress as well. And maybe we can also update some more detail over the course of this year.

Super. On the [indiscernible] business. I know your large -- a customer of your customer is increasing its capacity for EUV to 90 machines in 3 to 4 years, and they're asking also supply chain, if they can deliver more, is they also come to you and you are able to deliver the systems is that possible? And therefore, the growth will be good in the next years because the number of units will go up significantly, maybe double in the next 2 to 3 years?

Yes. So from our perspective, it's no problem. I think it's a much bigger challenge to build up the team in a higher number of one today. So for us, if you keep in mind, we need at least 2 chiller units per machine, but the volume for production is not so big as that we have some capacity limitations at this point. So we can follow the good part of this company, and we will do our best to bring them the right systems at the right time.

Good margin business. Maybe on Energy Management, only an update maybe -- that outside the rail business, how much maybe in the automotive in the truck business? You mentioned in the last call, that things have really gone up there, has a strength going on so new projects are coming in for charging and so on. So it's also the prospect of -- rail is great, but also maybe it's the second growth here.

Yes. So the other markets outside of rail are developing quite well as well. As you can imagine, electrification, digitalization is progressing. As I said, this is in our favor. We are working on a number of new programs in all the other mentioned markets. And I'm sure we are able to present and publish something also within the next 6 months.

And now let's come to Mr. Glowa again. Let's give it the second try.

Am I audible?

We can hear you but not very good. Can you try it again?

There's an echo inside the line. Maybe you have...

Is this better now?

A little bit. We try to -- please ask your question. We hope that we can understand it.

Okay. Sorry for the hiccup. My first question would be can you please quantify how much of your top line expansion in the first half year is due to volume? How much is due to price increase? And my second question related to that would be, you talked about our revenue shift or revenue postponement in the first half year due to certain trend. Can you quantify how much sales has been postponed? And do you expect to pay the catch-up in the second half year as supply bottlenecks seems to basically ease off?

Okay. We understood your question. Maybe we should repeat it once again for all of the team. The first question was if we can quantify the volume and revenue which is coming from the material price increase. The answer would be, I think I told it last time as well, 2% to 3%, we see from price increases which we could pass through to our customers, the rest is volume effect. And the second question, if I got it right, was the shift of business from supply chain problems from one quarter to the other. The number we saw is around...

5%.

5%, yes. 5% is within our order backlog, which is related to material issues. But we can't say completely that it shifted from this quarter to the next one. It's within this year somewhere depending when the material comes in. So that was the question we got so far.

I will continue with a second question on your free cash flow, working capital specifically. We have seen quite an increase in inventory [indiscernible]. How do you look at your working capital development in the second half year? We're seeing some [indiscernible]. And is the steep increase in the receivables an indication that momentum at the end of this year slightly increase? So should we expect an acceleration of sales in the second half year? And related to that, also CapEx, can you give an indication how we should think at your CapEx for the full year.

So I'm not sure if I got all, but hopefully most of it. I understood the first one was related to our cash flow, free cash flow development, receivables, et cetera. And yes, the negative trends you have anticipated or you have seen. For sure, this is 100% related to the increase of inventories, of stock billing measures we must do over the first 6 months to keep our company up and running to deliver our customers on time somehow and to build the stock for the same motivation for the second half of this year. This was around about EUR 10 million if you compare the figures from this year to the last year. I think we have reached maximum buffer now where we can deal with. We are not willing to increase this level further. Regarding the receivables, this is definitively period-related. Things are looking much different after end of period, after cash is kicking in maybe a couple of days later. We do expect a positive cash flow after the end of the year. We have forecasted this quite precisely and there are no worries to another direction. Regarding CapEx, I'm not sure if I could get it 100% right. Peter, maybe you?

There was an echo. Maybe you can repeat this question once again.

I was just wondering how could you look about your expectations on CapEx for the full year? Is there a pick up in the second half year or does that pretty much look as in the first half year?

So we expect a positive free cash flow by the end of the year. We will reduce a little bit the inventory situation. We have some special aspects inside where we have to cover a long purchasing period for different products. But in some -- under the condition that we will pay back some financial credit, we will have a positive free cash flow by the end of the year in the single digit -- let me say, in the mid-range of the single-digit size.