Agfa-Gevaert Stock

Ladies and gentlemen, welcome to the Agfa Second Quarter 2026 Results Conference Call. [Operator Instructions]

Now I will hand the conference over to Pascal Juery, CEO. Please go ahead, sir.

Good morning, everyone, and thank you for attending our conference. I am sitting today with Fiona Lam, our CFO, and the rest of the executive team. And before I walk you through the results, I would just like to come back to the transition we are having today with Fiona Lam, who is going to leave the group by the end of the month, and the announcement of our new CFO, Declan Guerin.

So I just want to publicly thank Fiona for the 2 years she has spent with Agfa, having an excellent impact and helping me in steering the transformation of the group. This is the last call that Fiona is going to do today with you. And there will be no vacancy because in November we will have our new CFO in place, since Declan will be starting 1st of October. So thank you, Fiona.

Turning to the results. As you've seen, pretty resilient results, but a lot of moving parts, actually. If I start with the 3 growth engines of Agfa, I can start with HealthCare IT. Very good commercial momentum, very good order intake, excellent move to the cloud, a lot of net new cloud customers. But as I repeat every time, there is an impact of this cloud transformation, and that's the delay of revenue and margin recognition.

And as you can see, the SaaS transformation of the business is accelerating because our order intake was 50% cloud-based during the quarter. But the message is also we are winning in the market. 54% of our order intake is with net new customers, meaning we are winning share, and we are able to win this share against the market leaders.

DPS is back to growth for the semester after a 25 year that was a year of, we call it consolidation. We are back to double-digit growth, and that's very good, so it's very positive. And last, of course, the membrane is having, I would say, a very difficult year. The hydrogen membrane, it is a trough. We are part of a trough today where actually we are very confident to see a very sizable rebound in '27. But in '26, we are in a situation where our customers have already what they need in terms of membranes in inventory, and therefore it is a bit of a lost year for ZIRFON. But we remain extremely confident going forward about the growth potential for ZIRFON, and that will start materializing as soon as '27. So that's the state of the 3 growth engines.

The resilience of the results is also to be credited to imaging and chemicals. Film in volume decline environment has been able to actually generate positive results. This is a reflection of the huge restructuring effort we have undertaken now for a 1.5-year that places us ahead of the curve today and is more than enough to compensate today the volume decline.

And we are able to do that in a very turbulent environment, especially with the huge volatility on silver prices. We are able to navigate the market to increase prices to customers as well. It's a very positive thing for the group. And DR is, I would rate it as stable. So overall, quite, I believe, a good performance given the market backdrop.

I will turn now to Fiona to walk you through the numbers.

Thank you, Pascal. So in terms of the numbers, a solid quarter like Pascal has said. The Film and Chemicals, Imaging and Chemicals, the silver impact on the revenue offsetting more than the volume impact. So you see plus 2.6% growth excluding currency. We are specifically pleased with 11% growth on DPS, although still not sufficiently offsetting the decline of Green Hydrogen Solutions because of soft market condition this year. But like Pascal said, the rebound we are expecting in 2027 in Green Hydrogen Solutions.

We are also very pleased with HealthCare IT in terms of the transformation, the order intake, the recurrent revenue. So the quality of HealthCare IT revenue has been improved on track, even though we see a minus 9.5% decline in the second quarter on HealthCare IT in the current revenue, which is anticipated, because we also know last year we had a very strong HealthCare IT own license sale in the first half of year. So seasonality of HealthCare IT last year in the first half of the year was very strong, and we anticipate on HealthCare IT second half of the year would be basically offsetting that negative trend.

If we look at EBITDA, I think we could say it's really a solid performance on the EBITDA. We see the step up of Film and Chemicals on the saving program that have adjusted our cost base for the decline. So we are able to step up from EUR 4 million to EUR 9 million.

For Industrial Solutions, also there and also Green Hydrogen Solutions, a very small decline based a big cost on the top line, but the good cost control has been able to maintain a reasonable adjusted EBITDA level. And HealthCare IT is actually better than our internal expectation, even though you see a decline. We anticipated it, this cloud transition, we anticipated strong last first half year. So all in all, we are happy with the Q2 adjusted EBITDA because it is a very solid performance.

Here you see also the bridge basically it confirms earlier we said HealthCare IT and Industrial Solutions were because of the top line decline. Imaging and Chemicals, the saving programs, were able to contribute so that the volume decline is offset on the gross profit. And then we have all the good work being done within Agfa on adjusting the costs and their savings are delivered and stabilizing our Q2 EBITDA as such.

On free cash flow, so even though we, Q2, still consume EUR 10 million negative free cash flow, it is well managed. It's better than expectation internally because we actually have a large quarter of cash out for the expected transformation program, restructuring program which we have announced last year. So it is anticipated a large cash out this quarter.

We have, of course, the normal pension. So if we look at that, all in all, our working capital has been managed very well, and also our provision, et cetera. Without, let's say, the impact of silver, it would be much better. But we managed to offset quite a lot of this negative impact internally. So a minus EUR 10 million cash flow is a good outcome for Q2.

And that's, you can also see the evolution of our debt. If you see the net financial debt, basically in Q2, of course, it has been stepped up from EUR 58 million to EUR 74 million because of the net negative free cash flow. But we also know, like I earlier said, it is better than expectation.

So we have now end of Q2, we draw EUR 130 million of facility out of the EUR 180 million. It's also provided at the end our Q2 covenants tests have sufficient headroom. You see liquidity headroom is sufficient compared to the minimum of EUR 30 million. Leverage ratio is stable at 1.4, and interest cover is also well managed and adjusted EBITDA governance is at EUR 52 million versus EUR 30 million. This is basically thanks to all the efforts and the business in the working capital improvements and also the better EBITDA as first half of the year.

So if you look at the numbers, we just highlighted in the graph, the Q2 numbers here is worth also to have a quick look on the first half of the year. So first half of the year, we delivered actually EUR 10 million more adjusted EBITDA compared to last year because as you know, and still record, for one we have a stronger adjusted EBITDA in Q1 and Q2 is stable. So we ended with EUR 10 million more adjusted EBITDA compared to last year.

And on net results, you see even there we are worse than last year. Just wanted to remind, last year in the adjustment and restructuring expenses, we had the AgfaPhoto that was being booked in June of last year, EUR 38 million. It was not cash being received, but it was booked in the P&L last year under the non-recurrence in 2025.

Also, the net finance cost was another EUR 7 million because of AgfaPhoto that was being booked as well in last year. So all in all, you see without AgfaPhoto, our net results improvement step up is equivalent to what we have stepped up in adjusted EBITDA to be aware.

Free cash flow is the same as what we have earlier said, minus EUR 10 million free cash flow. But also for the first 6 months, we are at minus EUR 52 million in total, and that's offsetting. Remember the first half year we have EUR 45 million silver impact of purchasing silvers for the stock ramp-up of our net working capital for that, and we were able to offset quite a large part of this and maintain a step up compared to last year of minus EUR 30 million to minus EUR 52 million. So that effect is quite largely managed from Agfa.

Thank you for the transition to HealthCare IT, now for Pascal.

Thank you, Fiona. Healthcare IT, so clearly if I look at the P&L, 2 reasons as explained already why we are below last year per seasonality of last year. We still have more, I would say, project revenue and license very clearly on the transition to the cloud is the explanation of what we are seeing today.

But I want to insist this transition is going well. And as you have seen, the order intake is increasing by 28%. I hope that I'm sure that we will break the EUR 200 million mark for the year, last 5 months. So cloud-based order intake more than tripled, which is showing really that this transition is accelerating. So cloud deals have represented 50% of our orders.

What I want to insist on as well is it's done with net new customers, meaning we are winning new logos in the market, which shows that our offer is appreciated and extremely competitive, of course. And that really this momentum is really accelerating quarter-after-quarter.

So overall, even if the P&L is not yet delivering this transformation, I mean, we are in the way of growth and profitable growth in HealthCare IT, and the order intake is really the best leading indicator we can use to describe our business.

Overall, I -- again show the same slide that shows the impact of changing from license revenue to subscription model. As you see, it has a significant impact on the sales, and also, therefore, the profit with a totally different model spread over time.

Then the number of, we've already commented this number, so I'm not going to dwell on it too much. But again, nothing is broken with HealthCare IT. On the contrary, we have good momentum in the market, and we are expecting also the second part of the year to be as normal. The fourth quarter will be the highest quarter. This is the seasonality of this business, and it will happen again this year.

So now let me turn to Industrial Solutions. Here a contrast, I would say very good with the Digital Printing Solutions. After a year '25 where the growth was somehow subdued, we are now growing again, double-digit the business. And really what we are pleased to see is we are growing in the high-end market, in the high-end part of our offering.

We chose excellent traction today, and of course, the consumables are part of this growth with sales of ink increasing across the board 10% as well. We do, for our high-end offering, receive a lot of customer recognition and actually awards. And we are not forgetting also to continue to build our offer in packaging. This time it's a collaboration with the software area to make sure we can offer the best full solution to our customers in the packaging segment. So overall, DPS returned to growth and good prospect going forward.

Very different story for Green Hydrogen Solutions. '26 is pretty much a trough for last year. But there are things advancing very well in the background. First, the REDIII implementation is taking place now after some delays. We are seeing projects being FID'd in Europe, which we didn't see for some time actually.

And we have an excellent momentum in Asia. We have our first sales in China, while still modest, of course, but that's a start. And we are also doing extremely well in India. So the message is, yes, short-term, '26 is not a good year for ZIRFON or the green hydrogen membrane. We already look at '27 with great confidence that we are going to rebound in the market. And we are also very happy to see that in the meantime, we are growing the recognition of the performance of the membrane, and especially in Asia, which are our priorities in terms of commercial development today.

Turning to the sales, to make a long story short, what you see here is a DPS that is up and a membrane that is down. So overall, indeed, the membrane has an impact on the segment in spite of the good performance of DPS.

Imaging and Chemicals. Well, where I'm really happy is the fact that somehow we have turned a corner in film. We were suffering from a significant volume decline in film, while we were putting in place our restructuring efforts. So now these restructuring efforts are going full steam. Savings are in place, not only in the operations but also in our go-to market.

And we have turned the corner, and we are now in a position to claw back some of the profitability of film. And we are also doing that in a market backdrop that is not easy with the volatility of silver price. So although the volumes continue to decline in film, we are seeing an improved profitability.

DR, well, Q2 was not a very good quarter for DR, but I would say that profit-wise, we are on par with last year. So nothing really to worry about. We have put together a renewed strategic roadmap for the business, which we are confident will provide the ability to grow top and bottom line in this business.

So overall, here maybe I will show the P&L because the P&L is showing actually the cost efforts that we have made in Imaging and Chemicals with gross profit up in spite of decreased volume. So as you can see as well, our OpEx decreased, which is extremely significant and is a result of the efforts I referred to.

Outlook, well, for HealthCare IT, we are seeing the rest of the year to continue with our momentum in terms of order intake. Same momentum, I would say, and profitability will be in line with last year's in the context of this cloud transition.

Industrial H2 will be the same with DPS well oriented and ZIRFON still subdued. Again, we're not expecting any rebound in '26, but in '27 for ZIRFON. And we do have some visibility of the project and the customer orders.

In Imaging and Chemicals, we will for the full year restore somehow profitability of film. It's going to be better than last year. Again, the trend will continue to adjust our cost to what we see in the market and will continue to be very proactive in terms of silver-based pricing.

Cash flow for the year is expected to be more negative. We explained it. We don't have an AgfaPhoto this year, and we still have significant cash out related to the transformation and the restructurings that we are having for the company. But again, I want to repeat, even if the quarter results are today largely due to the good performance of film, nothing is broken with our growth engines. HealthCare IT is winning in the market, it's winning orders. DPS is growing, and ZIRFON is going to rebound. So nothing is broken, and we confirm the ability of the group to pursue its transformation.

I will stop here and open for questions for the analysts and the press.

[Operator Instructions] The first question is coming from Alexander Craeymeersch from Kepler Cheuvreux.

So the first one would be on the transformation cash outs. So when you announced the transformation program in 2024, you indicated that it would be self-funding, but of course, now we already see a EUR 30 million cash out by H1 related to this restructuring program. So what has changed versus that original assumption? And how much additional cash out should we now expect from this program going forward?

The second question would be on AgfaPhoto. So you mentioned that the Frankfurt Higher Regional Court decided to annul the ICC award that remits the case back to the tribunal. So I mean, as an analyst, it's difficult to see the downside risk from here. Could you actually be required to pay that EUR 45 million back? Or are you already required to give it back? That would be my second question.

Then the third question would be on HealthCare IT. I think when looking at peers, we see that there is also increasing investments in AI-related functionality, and I was wondering how much product development is required for the HealthCare IT, specifically the cloud, to remain competitive midterm, and how much we should pencil in a sort of R&D budget for these features.

Thank you, Alexander. On the first question on the cash transformation, well, yes, I mean, it is self-funding. I mean, today we have a recurring level of savings of more than EUR 60 million from the program, and that corresponds more or less, I would say, to the cost of the implementation.

So yes, things are self-funding in this way, so to speak. You want to add something, Fiona?

Yes, maybe just to add, of course, you see in the free cash flow, cash out of this amount per quarter, and the savings are in the operating expenses, where you also see the improved EBITDA, where you also see how much lower operating expenses you can see in our P&L...

Yes.

...delivering. And plus, of course, each quarter seasonality is different because your cash out sometimes you see a different quarter while your savings are ramping up. So you see, like Pascal said, the annualized saving is EUR 61 million, and you see those cash out, of course, you see different time phases. So you will never be excessively each quarter balancing each other, of course.

Absolutely.

That's actually quite clear. So does that mean or imply that the full year costs cash out is also around EUR 60 million?

On the Moonshot program, you can say that. Yes, it is different timing, different year. Some last year, some this year, some next year. Moonshot program, but we also have other programs.

What we call Moonshot is a restructuring of Mortsel operations actually.

Yes.

So it is our internal project name, and indeed, that's one to one, so to speak.

AgfaPhoto. A question on AgfaPhoto. Let me explain the situation. What happened recently, in Germany, when you have the result of an arbitrage, you have the possibility to go for an annulment process that is not based on the subject matter but on the process itself. And that's what happened in a Frankfurt court. And -- so the judgment is not about the subject matter, it's about a process, and actually the right of the defense in respect.

So first, we have made an appeal of this judgment for which we are awaiting the outcome. Then if the judgment is sustained, it means it will go back to arbitrage, but not for the full arbitration, just on the specific issue that was pointed by the court related to the right of the defense. So we are not starting again. And point #4, no, we keep the money. There is no impact at all on the money.

I would like to remind everyone that we have prevailed in 2 arbitration of the subject matter. So whatever the decision of the appeal, we are extremely confident that it will be the case for the small -- well, the part that we will have to review in the arbitration. So no, we are keeping the cash.

Point #3, HealthCare IT, and thanks very much for the question, Alexander. It is an excellent question. First, I would like to remind everyone that we are investing a significant amount of R&D in the business, and we have over time increased significantly our efforts in R&D. Because today it's close to EUR 40 million out of a business that is about EUR 240 million.

Then AI is not only an investment, it has a return. For instance, today we are using AI in our coding activities, and here you have an immediate benefit because you are increasing productivity by 30% to 50%, depending on what you do on AI. So actually it's not a cost, it's a boost for us.

And indeed, we are integrating, we always have integrated AI for many years in the diagnosis part, in the solution part, in the image generation part. We have already solutions that are commercial today in AI. And the third impact where we are using AI is actually on what we call the workflow orchestration, because remember, we are not selling only a software, we are selling a full solution. We are managing the workflow of a radiologist from the time he takes an appointment to the time the image is being stored and archived. Managing this workflow is leveraged today by AI.

So don't believe that we need a specific more budget for AI. We are using our current R&D resources to actually invest in these solutions, and I gave you 3 areas where AI has an impact, and I repeat it. In the coding itself by going faster and doing more for the same resources. AI solutions to help the clinician to make a diagnosis. And 3, automation of the workflow also to gain productivity and capacity at the end of the day in a world where we are resource-constrained for radiologists.

So AI is totally embedded in everything that we are doing in HealthCare IT. Actually for us it's a great opportunity to develop our products for the benefits of clinicians and patients.

And maybe if I can just ask a small follow-up on that. Does the cloud also allow for third-party applications to be integrated?

Yes. We are providing, as I said, a full solution model in which we have our own, of course, softwares, but we also integrate third-party softwares. So the answer is yes, yes. Absolutely.

The next question is coming from Guy Sips from KBC Securities.

I have one question that I already highlighted in my morning note this morning. The new director, Kurt Decat, and the new CFO have both a carve-out history. Could this lead the way for HealthCare IT?

Well, you are right, but they also have history in corporation as well. I think Kurt Decat was the CFO of Sibelco, for instance, which was not a carve-out. And I think Declan has experience as well in very good corporate names like Rolls-Royce and whatnot. So it's not -- but the fact that indeed they have an experience and background in PE is a plus for me, and is a plus, I think, for the team, because we are going through a transformation. Yes, where we might look at strategic options. Of course, we are always looking at strategic options, okay.

So I think it's a very good observation from you, indeed. But they are not only PE, they are broader than that, most of them.

Any maybe to comment on august, and speak to my question, could this lead the way for HealthCare IT?

I'm not going to comment on that. Clearly, the first priority we have for HealthCare IT today is to succeed the cloud transition, okay.

Now if the question is why do we keep an IT business with an industrial business, it's a legitimate question. But for the time being, I think we have been the right shareholder and investor for HealthCare IT, given our track record in the past years on the business transformation. And again, this is our first priority, and clearly it's build up the value of this business. Fiona wanted to add something.

Yes, I just wanted to add, based on the eyes of CFO, to your question. He is I think Agfa, we just need an all-round comprehensive CFO who is good in finance, corporate finance, but also good in transformation, who is strategic optionality. That is where a good competence CFO is

Absolutely. By the way, yourself, you have both an experience in corporate and in PE-backed companies. I think it's part of being a well-rounded CFO, as you say it very well. Okay.

There are no further questions at this time, so I hand the conference back to Pascal Juery, CEO, for any closing remarks.

Well, thanks a lot. So again, as you see, we have addressed the film situation, I think, quite efficiently, and that shows today in our results. In the meantime, I want to repeat my message, nothing is broken with the growth engines on the contrary. I mean, the commercial momentum that we are seeing for HealthCare IT, we have never seen that before, gaining so many new customers, large contracts, and very interesting contracts.

DPS is in growth mode, and here the name of the game for us is only to accelerate this growth. And ZIRFON is not having a good year, but stay tuned. It is going to change very rapidly in '27, and the technology is confirmed to be the top class and the reference technology for membranes in the hydrogen world. So clearly, we are extremely confident about what we are doing. So thanks very much, and I will speak to you now in November, I guess.

This concludes today's call. Thank you for your participation. You may now disconnect.

Ladies and gentlemen, welcome to the Agfa First Quarter 2026 Results Conference Call. [Operator Instructions]

Now I will hand the conference over to Pascal Juery, CEO. Please go ahead, sir.

Good morning, everyone, and welcome to the Agfa call. I'm sitting here in Mortsel with Fiona Lam, our CFO; Viviane Dictus, Head of Investor Relations; and the executive team of Agfa.

So first quarter, let me move the slide. So I'm going to briefly give the highlights, then pass on the mic to Fiona for the financial review. I will do the business review and the outlook. So first, highlights, well, clearly, Q1 for me is a robust performance in [ positive ] top line coming from pricing film area and volume impact in Digital Printing, the rest of the group being slightly below last year.

Strong EBITDA increase year-on-year. Last year was a relatively weak quarter for us. It reflects our ability to implement efficiently our saving programs. You will see it throughout this presentation and as well the ability to pass on the silver price impact to our customers in the film activities. As you know, we've been seeing a tremendous increase of silver, I would say, since 1.5 years with price having almost quadrupled in the same period.

And these results show our ability to navigate these market circumstances with efficiency. Saving programs that we have launched last year, I'm happy to report we are now in annualized savings of EUR 57 million. If you remember, we talked about the plan of EUR 50 million first, and we launched at the end of last year, another plan for an extra EUR 25 million. So we are right on track. And as we started to see in Q4, actually the impact of the cost measures are now coming to the P&L and this is also what you see during the first quarter of the year.

Silver, of course, had an impact, specific impact on the cash for a very simple reason. When we buy silver, you have an approximately 5 to 6 months cash cycle before you recover it in terms of cash from your customers. The P&L impact is faster, but the cash impact of course, is -- takes a lot longer and it has of course, a tremendous impact on the cash of the group, and especially for the working capital, more than EUR 40 million worth of silver price impact during the first quarter that we will start to recover over the year, but the overall impact of silver cash during the year will be negative.

Now business by business highlights. HealthCare IT, I would say, transformation to SaaS on track. However, as we repeatedly said, the orders are larger in SaaS. We are also addressing just larger customers and therefore, the contract and the order intake is a bit lumpy, meaning you can have significant variation quarter-on-quarter, and this is the case. We have in Q1, I would say, a quarter that is soft in terms of order intake, while we are expecting in Q2, and we know that because we have already signed a number of deals, we are expecting for Q2 a very strong order intake quarter.

So the last 12 months decrease that you see at the end of Q1 does not change the overall picture on the guidance that we have. That at the end of the year we will be again increasing order intake to the highest level ever and probably high single digits at least. The good news also that we are seeing is in this context, our recurring revenue increased by 5% now, and now amounts to 67% of total Q1 revenue. This is a number that 3 years ago was barely above 50%, and it shows also the transition of the business to a recurring business.

The total top line still decreased due to the fact of the change of model, as we explained several times, that the short-term impact of the move to a subscription model rather than a project model.

Industrial Solutions, I would say good DPS and very subdued Green Hydrogen business. Good DPS because we are back at 10% growth top line for the first quarter. So it shows that what we've seen during Q4 is being confirmed. However, a very soft situation for Green Hydrogen and '26 is probably going to be a lot softer than we even forecasted actually. And we are already seeing shaping up '27 that will be kind of back to normal, but we are really going through a trough during the '26. And last but not least, Imaging and Chemicals with our business, as you see, a significant increase in adjusted EBITDA due to savings and what we did around silver And we also discuss, of course, DR, where here I would say things are -- top line is increasing.

We are deploying our plan as scheduled. So overall, in a volatile environment, we have been able to navigate all the market conditions successfully, and we are also confirming the drive, the impact of our cost savings measure.

I'm going to turn now to Fiona, who will walk you through the financials.

Thank you, Pascal. This slide summarizes the growth which Pascal actually just highlighted on top line and bottom line. On the top line, you see here the nominal sales growth compared to comparable sales growth without currency impact is actually better. Like Pascal already mentioned earlier, the group actually posted a 1.7% comparable sales growth because of the higher silver prices. You also see on a comparable basis, actually the Industrial Solutions also has a growth even though GHS was soft but DPS was stepping up in that context.

HealthCare IT on a comparable basis is roughly 5% down without currency because of actually if you recall last year, the first half of year of HealthCare IT was extremely strong. And this year it will be in the normal seasonality. We still expect a full year of HealthCare IT, which lead to a certain growth.

If you look at adjusted EBITDA, a step-up of EUR 10 million for Q1 driven again by Imaging and Chemicals, largely related to the savings program now that we have larger savings program kicking in now starting this year. Step by step, you see that as well. And the ability, of course, to pass through the silver impact to the market so that we don't have any negative impact in our P&L on the film parts.

For Industrial Solutions, you also see a step-up, although the step-up could have been larger if we don't have the headwind of GHS. But all in all, you see the step-up driven by DPS on this. HealthCare IT, I already mentioned, is a seasonality of Q1. Q1 last year and Q2 last year was very strong. And so with the good cost control, et cetera, they still are delivering good decent numbers on bottom line. Corporate is more or less in line than what we expected, the seasonality as well. Thank you.

Next slide. If you look at the bridge, it says about the EUR 10 million earlier slide that we have seen. You see here exchange rates on bottom line. Luckily we have a very diverse geographic spread. And so you see all the business at the end on the bottom line exchange rate has 0 impact. And then you see the gross profit of HealthCare IT driven by a strong first quarter last year, and this is a bit down and you see also the step-up of Imaging and Chemicals on the gross profit because of the saving programs and the silver pass-through ability.

All in all, also the Agfa team delivers, I think, a resilience continuous cost control. And you see also R&D, SG&A, continue to contribute with significant tight cost control that also contributed to the results. So it's been a decent, good solid quarter. On free cash flow, I must say I'm pretty happy with this result, even though we see a first quarter of minus EUR 42 million free cash flow. Bear in mind that there's a EUR 41 million silver impact with the resilience of all the efforts which is continuously on working capital improvement, it really delivers.

We have been already in the last, I think, 6 quarters improvements of working capital and this can counterbalance the silver impact that we have for this year, for this quarter. CapEx is expected and also provision and others, we continue to monetize the customer lease portfolios as well. So all in all, if you look at without silver impact, actually free cash flow would have been 0 at breakeven level, which is significant to be able to fund the pension and all the transformation programs in this case.

If we look at the next slide on the net debt, financial debt evolution, we are also evolving right. Of course, you see in Q1, normally, it's always a step-up because we need to build the working capital time line again. But despite the silver, you see the working capital time line is still significantly lower for all business units. And therefore, we, at the end, we step up by -- from EUR 21 million to EUR 58 million.

If you look at actually on the revolving credit facility, we draw in Q1 EUR 129 million of the EUR 180 million. For Q1, there's only one applicable governance, that's the liquidity headroom, and that is at EUR 120 million of the minimum of EUR 30 million. As for the reference of all the other ratios, it's not applicable in Q1 but applicable as all from half year testing. We actually have also a good headroom there.

Leverage, you can see, is at basically Q1 of 1.1. Half year in Q2 should be at 3 as well, and year-end 2.75. Interest cover is at 12.5, and EBITDA, we actually step up the headroom compared to end of Q4, now to EUR 51.6 million with the good EBITDA result.

In terms of numbers, I think I don't need to repeat it once again. You have seen them the same as in the first two slides on this one. Maybe just next slide for the...

I think we should still look at operational expenses, a significant impact delivering our results.

Yes. It's also same as in the bridge where it shows R&D, SG&A significantly down, and you can see it here, basically EUR 8 million down. That's a conversion of the graph, you see them.

Next slide would be good to just shortly discuss because we didn't show them in the graph. You see the net result at the end is also still a negative EUR 12 million, but it's a step-up of -- compared to last year of EUR 8 million. And that has to do with the better operational adjusted EBITDA performance, although we have adjustment restructuring expenses which is higher for this quarter and in line with net financing cost expectation and taxes is a bit positive as well.

Thanks a lot -- no, free cash flow, sorry. We already showed it in the graph.

Yes, free cash flow we already discussed in the graph so it's exactly the same you have seen.

So let me turn now to the business, HealthCare IT. Well, as already said, indeed, the cloud transition continues. That's going to be lasting for the next year I would say. Again, I repeat more lumpiness in the order intake for 2 reasons, larger contract, very long-term contracts. It's not unusual right now that we sign 7, 8 or 10-year contracts with our customers.

So larger amount and larger customers as well. Our net new customer size is significantly higher than the average of the installed base. So indeed, we shouldn't be looking at these results quarter-by-quarter, but as a more long-term area. And I'm not bothered, as I told you, by the minus 10% at the end of Q1. Actually, it's going to be significantly above at the end of Q2 and that we already know because the deals are already landed.

So Q1 cloud deals relatively modest this quarter, 12%, net new customers 18%. And as you see recurring business, 1/3 compared to project business, 2/3. So it was, again, kind of a soft order intake quarter, but the journey to the cloud continues. And I'd like to remind everyone that we are gaining net new customers due to the fact that we are sitting on top of the customer satisfaction charts of the industry today, meaning I'm going to be very clear in customer satisfaction today in North America, which is the core market for us, we are #1 in 3 out of 4 categories. So we are #1.

I show this slide -- I've been showing this slide again and again and again so that we really try to explain that the top line decrease that we are seeing today as we are gaining customers purely mechanically due to the fact that project order intake is decreasing and SaaS order intake is decreasing. And you see here the revenue model that explains a bit what it does to our P&L. But again, going to the cloud means business that is recurring, that is sticky, where we can do some upsell, and we have embedded growth. So it's all good news for us.

Now the numbers, minus 10% is unadjusted by currency. Adjusted by currency, it's minus 5%, a little bit less than minus 5% actually, but with recurring increasing 5% and project revenue decreasing more, of course. So in terms of EBITDA, quarter-to-quarter, well, again, it can be a bit lumpy. Last year, we recognized significant number of licensees. So project business model, not this year, but we confirmed the overall guidance for HealthCare IT for the year nonetheless.

So overall, I would say the transformation goes on as planned. And again, the difference of quarter is not really relevant this year. We're going to have a stronger second quarter -- second semester than first semester. Last year it was a little bit more balanced. Industrial Solutions, DPS, as I said, the good news of DPS is we were challenged a bit in terms of growth during the year '25. It improved in Q4, and Q1 is also showing a 10% top line growth corrected for currency.

We have an order book that is building, and the mix is actually towards the more powerful machines for us. So a number of machines is one thing, but what's important as well is the size of the machine you're selling, and for us, also the ink consumption. And we are selling, I would say, our top range machines very well today.

We continue to, of course, upgrade our product range as we see fit. The only caveat I would put on the DPS business is the packaging market is very slow to develop, whereby we confirm that really digital is the avenue to go. The current state of the packaging market slows down a bit the market introduction. In, for ZIRFON, for the Green Hydrogen membrane, this is the area where we have announced already that '26 was going to be a trough for us.

There is momentum in Asia, but that does not make up for the delays in Europe. Actually, you know, the RED Directive, the Renewable Energy Directive, is just being implemented in member states in Europe. And this is absolutely necessary to get the regulatory support we need to further develop projects in Europe.

And it has been done with a bit of a delay, meaning, in fact, today for '26 deliveries, it's going to be a very low year for us. However, when we look at the pipeline and the number of projects reaching final investment decision, we are a lot more confident for '27 where we're going to see this rebound and the implementation of the directive will also help us very much.

We have also clearly addressed the emerging markets like India and China with our membranes. We are successful in India, we are working in China, and we hope that somehow we will also make inroads in this market. But this is the one area that will, I would say, not work for us in '26. If you look at the numbers again, this number on the left, minus 1.9% is nominal. If you remove currency, it's plus 2.7%.

But as you know, a strong contrast with double-digit growth in DPS and a retraction of the sales in the membranes in '26. Overall, when you look, and this is a new reporting, when you look at the way it works for DPS, it's a bit like in other businesses, meaning the second part of the year is much stronger than the first part of the year, and the highest quarter of the year is in Q4.

So it's not unusual for us to make negative EBITDA at the beginning of the year and a lot of EBITDA at the end of the year. This is a bit how this market works. We install about 40% of the equipment of the year in the fourth quarter. This is the way this market works.

Okay, so these are -- this is a P&L. I'm not coming back to that, and I'm going to turn now to Imaging and Chemicals. So really here on the film, again, the message here, we are in control. We are in control of our savings plan. We deliver fully what we announced. And we're also in control of our pricing and overall product management, which means today, even in a context where we have to face significant variation in silver price, we were able to stay on course and restore the profitability of the film.

So that is -- that is for me extremely positive in a context where the film market continues to decrease, but at a pace that is probably a little bit less than what we've seen in the past couple of years with China going down. So overall in control. DR, solid start of the year. Last year was a bit of surprising year for us with a very depressed end market, but we are seeing this market again back in growth mode. And we are also seeing that in the order intake that we have.

And so we are staying on course on this. So if you see, it's a bit spectacular, but coming from a very low point. If you remember, most of the year last year was actually negative for medical film. Now we have restored the profitability in the current context. The top line is really the story of lower volumes but better prices in fact. So when we look at the P&L, you can also see the step-up in gross profit, which reflects also the improvement of manufacturing costs. And the operational costs under control. And this is really the name of the game for this business.

Now if I turn to the outlook, I think broadly speaking I would say that the global outlook for the group has not changed since we presented it in March. However, when I go in further details, there are a bit of changes, I would say. HealthCare IT, no change. We continue to say we are going to deliver the year as planned, and we continue to say yes, we are going to see order intake growing at high single digits percent versus last year.

Actually, this should be the first year where we will have more than EUR 200 million in order intake. That's a bit what we -- bit what we had in mind, which is we are breaking record after record actually. Industrial Solutions, then there is a change. I mean, our view on DPS has not changed, but the view we have on the membrane has been downgraded with what we see now.

There is no possibility to improve volumes short term. And Imaging and Chemicals, if anything, our view is more optimistic regarding the year on Film and Chemicals on the basis of what we are seeing today in the market and our ability both to control our costs and our prices to customers, meaning overall for the group, we are not changing, so to speak, the outlook, but the mix will be a bit a bit different.

And I also want to stress that what we are going through with ZIRFON in '26, we're already seeing '27 shaping up as a significant rebound of the activity. In terms of cash flow, no change as well. Clearly, the silver price has put even more pressure on us, I would say, to manage very well our liquidity and cash, which is what we are doing, as you see, is a very good mastery of the working capital. We'll continue to do this, but we know that due to silver and due to the cost of the transformation, we will be consuming cash, I would say, during the year '26. I think I'm going to stop here and take the questions of the analysts and the press, if any.

[Operator Instructions] And the first question comes from the line of Alexander Craeymeersch of Kepler Cheuvreux.

Alexander from Kepler Cheuvreux here. First one would be on the Imaging and Chemicals. I see the adjusted EBITDA rose there from EUR 2.6 million to EUR 12.8 million, helped by savings and silver-related timing benefits. The question is now how structural are the savings and timings benefits because I assume that silver is quite a significant portion of this. So how should I look at the repeatability of this uplift towards Q2 and basically for the remainder of the year?

Okay. So I can start and you will complement, Fiona, if that's okay. Well, I think the savings are there, and they will continue to amplify. So clearly, it's a positive.

Sorry. How much of the increase is related to savings and how much is related to silver?

We're not breaking down everything in the numbers. But clearly, you see that the savings have stepped up -- started to step up very much in Q4 and that we are continuing to implement our plan in Q1. So we are not splitting the overall impact of savings and silver, but again, savings will stay and even be amplified.

For silver, the way it goes through the P&L is first with some revaluation of inventory and increased selling price. So you've got these 2 impacts and the negative impact of silver in the production cost. So -- but overall, we are not splitting. You want to -- Fiona?

Yes, maybe the answer to your question is if you look at full year basis, in principle, you do not expect silver really have an input because we pass through the silver impact to the customer top line and bottom line. There is a timing impact because in Q1, like now, for example, of course, we still have stock which were at lower cost of stock. There's a timing because you have a year-end cutoff in the end of December.

Sorry to disturb. Could you maybe get a bit closer to the microphone because I'm having struggle to understand, Fiona. Apologies.

Okay. Can you hear me better now?

Yes, that's better.

Yes. So I was saying on silver, if you look at a full year basis, you should anticipate normally we are not earning more profit bottom line on silver because we are passing through the silver impact to customer top line and bottom line and also cost. So that means they level each other out. You have a timing impact, a positive result normally in Q1 because, of course, we are still in a -- you have a cash conversion cycle, a throughput time of 3 to 6 months.

So that means basically in Q1, we have a large impact because the inventory were still from end of last year. Q2, you still have some impact because it depends on products, some are conversion cycle 3 months, some are 6 months. So on a full year basis, you still have because you have a cut-off calendar at the end of the year, you have some silver impact in 2026 on the full year as well as what is already reflected largely in Q1.

The rest of the improvement is on the saving program. Of course, you also know in the saving program, also a part of that got counterbalanced by the film decline as well. So we will have a good Q1, Q2. Second half of the year, there would be also holiday seasons of summer holiday, lower factory output, also Christmas lower factory output.

So you always see also in the past years, second half of the year on the Film and Chemicals is always a bit slower in profit on that regard, even though you have normally a high seasonality in Q4. So looking at that, we would have a step-up on the full year outlook, you can expect compared to last year, but it's not as amplified as Q1 and Q2.

Don't multiply the first quarter number by [ 4 ], Alexander, basically.

Yes, it's -- Okay. It would be handy, of course, and a bit providing a bit more comfort into the increase in profitability if you see that split between the silver timing and then, of course, the savings because I think the savings are structural. Of course, the silver timing is a bit less structural, but thank you for that.

And maybe if I have a bit of questions on HealthCare IT because I think this is a beautiful business. But you mentioned the shift to the cloud is the reason for the decline in sales, but I was looking at the slides of last year. And if you look there to the order intake, you actually notice that the cloud deals have declined as a percentage of the order intake and recurring business has also declined as a percentage of the order intake. So how do I square the 2 comments?

No. Well, as I said, don't look quarter-by-quarter, please, because it's, as I said, it's lumpy. It was in Q4, I think cloud order intake was more than 50%. In Q1, it was very low. In Q2, it's going to be very strong, up to the roof. So why? Because it depends on the contract. The contracts are significantly -- are significant when you are -- when we are landing like almost a EUR 30 million contract, that's -- this is the order intake of the first quarter.

And if we have such a contract in Q2 plus other contracts, it totally changes the mix. So really, please don't look at it quarter-to-quarter. You need to draw a line. And when you do that on a longer period, you see a continuous increase of the share of the cloud contract. Actually, I would even say today in the U.S., which is, as you know, the core market and more than 60% of the global market, all the contracts, virtually all the contracts that we are taking now are cloud contracts.

And we have extremely little today project order intake in the U.S. The market has really shifted. You have still project orders in the rest of the world, which is probably less advanced in terms of SaaS transition.

But again, I repeat, at the end of the year, we will be growing the order intake, and I expect the share of cloud order intake for the full year will continue to grow as a proportion. And all this is driven by net new customers. There is always a correlation. We have a relatively soft Q1 order intake, and you see net new customers 20%.

This number in Q2 is going to be extremely different. So that's why we need to really look at it from a longer period. But I think the key message here is, first, we are winning in the cloud. We are winning contracts today against Sectra and Visage in the cloud. Historically, the 2 fast movers and leaders of the cloud solution in the medical imaging market.

So not only we are competing, but we start to win. We win new -- net new customers. We increase always the recurring sales. And as I told you now it's almost close to 70%. It was 50% 3, 4 years ago. And we are -- by moving to the cloud and getting new customers, we are addressing larger customers as well than the average of our installed base. So all this is very positive.

What is not positive is the fact that the business model being changed. It's a significant delay before it hits the P&L because an order intake that we take in SaaS normally typically it's at least 9 to 12 months implementation time. That's why. Sorry for my long answer, but...

No, that's clear. And maybe if I can do -- yes, maybe one small follow-up in that respect. And this can hopefully not sound a bit too punchy, but it's basically that the cloud is supposed to be a higher-margin business. So I'm following from a bit of an outsider, if everything is going to cloud and the mix is improving towards cloud, why the EBIT is declining? I understand it's lumpy. But in the end, if cloud should bring a sort of positive mix effect. And right now, it seems from an outsider's perspective that cloud is working at a negative EBIT. So how much cloud business do you need on a recurring basis as a percentage of sales to turn that into positive territory?

No, I don't. So I -- thanks for the question, and I think it's a good opportunity to clarify. Yes, cloud margins are -- will be higher than project margins. However, we are just at the beginning. Remember that for the time being, we have 8 customers on the cloud, okay, more or less. And we had actually 4, I think, or 5 at the end of '25. So we are just at the start, meaning it's not yet -- not everything is fully optimized in terms of cost, okay, Alexander, meaning we know where we are going in terms of margins.

But as we start, we don't have the full efficiency yet, and it's going to be like going down the experience curve, okay? But we are doing that, and we are already seeing significant improvement in our margins. So don't -- for the time being, being still in a launch phase at the end of '26, we will have less than 20 -- we will have less than 15 customers on the cloud, and it will continue to build up. So we will -- we are becoming there more and more efficient. So it takes time, but I confirm indeed that it's a business proposition where margins are extremely high, but not at the beginning. You need to -- any other...

And the next question comes from the line of Guy Sips of KBC Securities.

I want to concentrate on Green Hydrogen Solutions. So what make you say that in Europe, the market sentiment began to improve in Europe was one of the items on your slides. And you mentioned several large projects reached financial investment decision. How many of these projects are now dedicated or will choose ZIRFON? And so what is your penetration?

Okay. I will start and maybe I will pass the mic to my colleague, Jorge Tomas, who is in-charge. But hydrogen projects are very visible. These are -- these are hundreds of millions in terms of amount, sometimes billions of investments. And if you -- and for this, we are a small part of it, as you know, as a membrane, but we have a good pipeline visibility. So what makes us think that in '27, we are going to build it again. Jorge, what do you -- what can you say actually to explain this?

Well, if you look at the pipeline of projects in recent announcements of FID, final investment decisions of larger projects in Europe as well as if you look at the recent auctions of new capacity that have been successful, you will see quite -- you will see one, an acceleration of projects coming to FID and going forward, particularly in regions such as Spain, but a bit across all over Europe.

For 2027, and I cannot exactly explain which of the projects we are engaged with, but that would be also revealing confidential information from our clients. What I can confirm is that the good number, and I would say the large majority of projects that are flagged for water alkaline electrolysis, which is a technology where we play, have been seized or have been run by our direct clients.

And I can also confirm that these direct clients have started discussions with us on commercial terms for the supply of these projects. So we see good indications that indeed 2027 will be a rebound as we start to supply these projects. Further than that towards the longer-term future, if you are also aware in terms of the national deployment of the Renewable Energy Directive, REDIII, you will see that the pace at which the national governments are now deploying or implementing this directive into local legislation is increasing and the perspectives are that finally, Europe is picking up speed and taking back last time.

Just a question on this -- the project in Spain that you were mentioning, is that the [ MUF ] project that thyssenkrupp did win recently?

Well, you know that thyssenkrupp is historically a client of us. You know that they have like MUF.

So you can connect the dots.

You can, but I will not confirm that.

Okay.

No, no, it's based on real projects.

Thank you very much. At this point, there are no more questions, and I hand the conference back to Pascal Juery for any closing remarks.

Thanks a lot. Okay. So in a nutshell, again, confirmed outlook. But as you've seen with an asset -- well, with Film, Imaging and Chemicals better than what we expected even a few months ago. ZIRFON, more difficult, but short term. The rest of the business, DPS on track and HealthCare IT on track.

And overall, I hope that message that I want to give you is the restructuring and savings plan that we have put in place is now deployed and starting to have its full effect and you can see it in the results. And it shows also and I want to insist on that, our ability to really navigate the market conditions of silver very efficiently in such a volatile context. And of course, I want to stress also the drive we have to make sure we are managing our cash liquidity and for instance, working capital in this context also quite tightly, I would say. So the market context is what it is. But in this market context, we believe we can indeed deliver the outlook we presented to you. Thanks a lot for your time and attention.

This concludes today's call. Thank you for your participation. You may now disconnect.

Ladies and gentlemen, welcome to the Agfa Full Year 2025 Results Conference Call. [Operator Instructions] I will now hand the conference over to Pascal Juery, CEO. Please go ahead.

Hello, everyone. I'm sitting in Mortsel right now with Fiona Lam, our CFO; Viviane Dictus, our Investment Relationship Manager; and the rest of the Executive Committee. I am going to walk you through the Q4 and full year results for the group. And my first message is indeed, we had quite a strong Q4. I would like to remind everyone that we do have a strong seasonality in our business and that every year, Q4 is by far the strongest quarter. But I realize that in '25, actually, we almost beat all records because Q4 EBITDA is 2/3 of the EBITDA of the year. So it's even more pronounced, I would say, than the years before.

Also, second very positive point, positive cash flow performance in the quarter and in the year. So I'm going to move the slide a bit indeed. Positive performance of cash flow due to 3 elements. I would say one is, of course, the management of the operations and because reduction of working capital was a strong. The second was also, I would say, management of liquidity because we are actually winding down our vendor loans in Agfa, so loans that we have extended to customers.

And number three, we have resolved the AgfaPhoto case and received actually the reward strong cash flow. These results are also coming, and I need to be very clear about it, but they are coming from a very stringent cash and cost management that we have applied and accelerated actually in Q4. And that's also the reason why we are coming to you today with probably results that were slightly better than expected, I would say. So EUR 39 million for the quarter. I'm going to come back to a bit in details about the contribution of different businesses. But overall, as you've seen, this is pretty much across the board that we are improving the results.

Now if I turn to -- briefly to the headlines of each businesses, I think HealthCare IT, as you know, we are in a cloud transition and being in a cloud transition is having a short-term impact. When I say short term, it's really 2 to 3 years impact on your top line and bottom line. I will come back to that. And in this context, what we are looking at is really the leading indicators, of course, and order intake has increased over the year by 14%, EUR 187 million. This is the highest order intake ever for the business and we are and we are booking record after record. And more importantly, the cloud order intake has increased by 38%, which shows really the dynamics of the cloud transition today.

Cloud technology is about 1/3 of our global order intake for '25. But when you look sequentially, actually, this trend is accelerating in Q4, for instance, it was up 58%, okay? Now as you know, quarters are lumpy in terms of order intake. We shouldn't be looking at quarters too much in terms of order intake, but the trend behind is really 33% of cloud order intake up from 27% in 2024, but we are seeing an acceleration.

And also, I want to stress that we are winning in the market. We are winning net new customers, 43% of order intake. So today, we are taking share in this market in the order intake and that will translate to sales, especially when it's cloud approximately a year after taking an order. So overall, pretty good performance in Agfa-Gevaert, I would say, in spite, by the way, of the adverse currency impact. We are operating mostly dollar and therefore, the translation impact is significant on the top line, bottom line. So that's where we are for [indiscernible].

DPC, clearly a very strong year -- Q4 representing by the [indiscernible] for this business across the board, I would say we had a strong Q4. All businesses have contributed to the growth actually, give you a bit more details.

On Radiology, I think the message here is, as you know, it's particularly impacted by the strong decrease of sales on medical film that we discussed over the past quarter. I think the message I want to pass for the first time this year, we have a positive EBITDA. This is effect of the ramp-up of the savings, but also the acceleration of our productivity plan in our main product supply operations, but also go-to-market actually. So that's what we are seeing along with generally, which is a strong [indiscernible] for the this year as well. Our DR business was affected by the fact that the end market for DR for the first time [indiscernible] negative and even if we are trying to outperforming the market, has negative impact [indiscernible].

So in this backdrop what to think I would like to share [indiscernible] as you have seen and you have seen examples of these in Q4, which we are continuing to see those. We are accelerating the plan to optimize [indiscernible] First we have accelerated the implementation of current plan and we have just actually concluded about 10 days ago an agreement with our social partner on the plan to work on additional measures that will put into effect as soon as April in this year to continue to adjust the cost base of the film activities not only in manufacturing but also in other areas.

I would like also to remind you that we have a new structure in place from the beginning of this year and that we will operate across 3 business segments. No change for [indiscernible] continue to provide full results as we do today. However, the change is more on the industrial part of the company. Industrial Solutions regroups 2 growth engines, actually GHS, Green Hydrogen Solutions; and DPS, Digital Printing Solutions. So it's going to be, I would say, a more direct read so on the growth engines performance for the company.

And Imaging and Chemicals, we have [indiscernible] activities. We believe also for operational reasons [indiscernible] we can manage this business a lot more asset-driven than market driven given the challenges that we are facing and of course that remains specific entity. We have bit of [indiscernible] that was announced a few years ago -- a few months ago a bit too much.

Okay. So that's the -- now let me walk you through the numbers before I turn to Fiona for details. So top line in Q4 still challenged to see that Radiology's market decline continues, I would say, unabated really the trend is really there. But we also have a reduction of top line for HealthCare IT. We had a slightly smaller quarter than last year, but this is also the impact of 2 things, the transition to cloud, which is less short term more on a recurring basis and also the impact of [indiscernible].

Now as you look the EBITDA, you see a strong improvement from the last year mainly from [indiscernible] upright cost [indiscernible] we are closing the gap [indiscernible].

Now if we look at the full year top line. Same comment as for Q4, the top line comes from mainly the decrease in [indiscernible] and the currency impact [indiscernible] most of our businesses, actually 2/3 of our business is outside of Europe in different currencies. And you can see that this impact, the same comment for 2015. Now if you look at the full year EBITDA, this is clear story. We have a strongly negative impact [indiscernible] while all the other opportunities are positively to the bottom line. I would say in a difficult background and context, there was not a lot of tailwind for us in '25.

So I'm going to turn to you, Fiona, to comment the bridges on the cash and other financial report.

Thank you, Pascal. So a bit more insight on the adjusted EBITDA bridge. Indeed, we ended the full year with EUR 11 million lower adjusted EBITDA, but that is mainly coming from [indiscernible] the [ EUR 25 million ] Radiology due to the volume decline and also the savings program only started to kick in the second half of the year a little bit and a bit more in Q4.

So if you see HealthCare IT and DPC, they have been contributing positively. HealthCare is also a EUR 5 million negative [indiscernible] impact and a large part of that is due to HealthCare IT because, as you know, HealthCare IT has a lot of U.S. business, while the other business have global spreads and currency. So you can see a large part of that actually is related to HealthCare IT as well. Otherwise, they would have been performing much better in bottom line.

A part of this negative impact on radiology has been offset by a very strong stringent cost controls that you see in SG&A we have delivered and R&D also we have delivered. So that at the end -- we narrowed the gap of the EUR 25 million to EUR 11 million. So we will deliver EUR 59 million of EBITDA.

On the cash flow, next slide -- on the cash flow, as we said, we actually have a very good year of free cash flow. We ended at EUR 35 million positive despite we lose actually EUR 11 million adjusted EBITDA. And this, of course, is actually helping on 3 elements: very, very good working capital that contributed EUR 36 million. Also, like Pascal already mentioned in the beginning, our customer lease financing portfolio, that contributed also another EUR 28 million (sic) [ EUR 27 million ] and we have the one-off of AgfaPhoto EUR 38 million.

So these 3 big improvements are able to help us to continue to invest in the CapEx of EUR 34 million and also pay our legacy liability of the pension, which is high. At the same time, it also help us to continue to transform and support the restructuring amount in the nonrecurrence, which you actually also have a cash out of EUR 48 million for last year.

So all in all, I think the improvement on working capital and finance strategy is the one that helps and continue to support the company's transformation and provide us a much better headroom and cash flow.

Next page. Associated with the free cash flow, you also see a nice good movement development of our net financial debt. You could also see here from 2024 end of the year and actually it is structurally down. So we ended at the year-end of EUR 21 million net financial debt. Of course, we still have quite a large total debt banking, but also there, you see the trend going down as well. So we also have ended our pension debt in the past and now coming down to 420 -- EUR 443 million (sic) [ EUR 422 million ]. So this is also a good development trend.

If we look at the revolving credit facility, we did at the end of the year draw EUR 100 million. So out of EUR 180 million was generated in December. So we actually have a lot of cash at hand in the bank because a lot of cash came in at the end of the year. That's also why you see net financial debt is only EUR 21 million.

Following this, we confirm that we have a good sufficient headroom at the end of the year for all our company's compliance, which we have agreed to submit with liquidity that rose EUR 158 million. You can also see the leverage is much lower. Also, the interest cover has sufficient as well and adjusted EBITDA covenant is EUR 41.8 million. So that's all in all quite a good headroom.

Also you see earlier slide already, the pension funds has been improved a lot on the status. Here is the 4 material countries and you also see that EUR 388 million [indiscernible] EUR 327 million. This mainly comes from benefit payments [indiscernible]. Also, we have a favorable year-end liability remeasurement.

In terms of 2026, we expect actually the cash out will be lower on the pension. We also expect the service cost will decrease mainly because of Belgium and Germany. We would expect [indiscernible] less contribution in 2026 versus 2025.

Here are some concrete numbers, which I will not go through one by one, but you have seen them already. Sales deteriorated by 4.5% nominally. And part of that is due to exchange rate. If you look at the gross profit that have reduced percentage-wise because of larger turnover and less fixed cost coverage. So therefore, you see actually due to Radiology, we have less gross profit.

Operating expenses has been contributing with good -- stringent cost control, and we are able to maintain -- bring the total operating cost according to more than what the top line increase is. So you see the percentage has increased -- improved by 0.5 point.

And that ends our adjusted EBIT 2025 versus 2024 with a difference of only EUR 4 million. If you look at adjusted EBIT -- on the adjusted -- after the adjusted EBIT, we have quite a significant amount of adjustment and restructuring expenses under the adjustments and restructuring basis of EUR 58 million for 2025, there is also EUR 38 million [indiscernible] positive impact. You can see they contributed this positive impact as well. And other -- net finance cost as well, there is also a total [ EUR 7 million ] interest benefit [indiscernible] versus 2024.

All in all, this brings our results for the period of EUR 71 million losses compared to 2024. If you look at the restructuring adjustments, just coming back besides, AgfaPhoto, we also have an impairment of our Radiology [indiscernible] part of the business because of [indiscernible].

Free cash flow, I think I already have gone through all of them. So you can see the numbers. I don't think we should repeat this because it's [indiscernible]. So thank you very much.

Thank you, Fiona. Very clear. Thanks very much. A bit of highlights on each of the business. So for HealthCare IT, I repeat really the key messages very quickly. Cloud adoption is accelerating in North America, and we are winning it. We are part of the winners in this moment. It's a significant event so that it's a trigger for customers to -- for our clients when they go to cloud to reopen their market, and we are successful in getting our share of this reopening. So I'm very pleased about the numbers.

I'm not going to repeat the numbers I already said, but I think really what you should take away is we are one of the few companies that are able to manage this cloud transition with excellent customer satisfaction. And I'm really proud because in this market, everybody is looking at the class market report. And this year, for the first time, we have actually in the 3 main components of the enterprise imaging system and software, we are best-in-class in the 3 categories: text, the image generation in itself, but also the viewer, meaning when you send an image to a radiologist and the archiving part to store and make it part of the medical report of the person.

I want to insist that the best-in-class actually was held by 1 company for 12 years, 12 years in a row. And now we are the top ranked company in the U.S. market for the first time ever for Agfa and after 12 years of leadership by another company, and it's a good illustration of the progress that we have made in the market.

If you ask me what is different with Agfa from the rest of the pack, I would say our ability to scale and to demonstrate effectively that we can provide our customers with a good execution and a good migration to the cloud. And this is the reason why we are winning in this market. It's a people business, it's word of mouth and it's customer satisfaction that does wonders for us and our commercial pipeline, therefore, is increasing almost every day, I would say, with this kind of external recognition that are based on real customer satisfaction.

So I'd like also to remind you, okay, that we are in the middle of a business model that we used to sell exclusively until 2024 almost project business, meaning where we a lot of upfront and then we have a smaller [ HealthCare IT]. The cloud business and revenue model is different. The upfront fee is much less, but the revenues are recurring and are higher than your typical SMS model. And you could say 2 things to understand is when we have an order in cloud, it will take between 9 and 12 months to implement. So there is, of course, a delay between the time we take an order and the time we can revenue recognize it first. And second, compared to a new trend project, this is going to take 5 years to kind of be on balance in terms of revenue and margin recognition.

But at the end of the day, the contract cloud richer, is more stable and recurring, is embedding growth because we have a system by which, of course, people pay directly on the consumption and not the fixed license. And therefore, this is short term impacting negatively our revenue and our earnings, but long term, totally transforming the business with much more recurring. So that's good news for us. And again, we're happy to say that we are taking our share in this market.

So in numbers, this is the reason why also you see top line decline, but I already went through it coming back to it. Just on the adjusted EBITDA, same comment we -- at constant currency, the increase will be actually much higher than about 12% higher. So it has an impact [indiscernible].

Now I'm going to go quickly. I'm going to switch to DPS. DPS was -- well, let's face it. For us, it was a bit of a disappointing year because DPS is a business that normally grows double digit. We have been able to grow 12% for 2 years in a row. And this year, it was a bit of a setback because we had a softer equipment market in North America, especially during the first half of the year where there was a lot of confusion created by the trade barriers and the tariffs that caused delayed investment.

And on top of that, we lost a bit of market share during this time in North America, which now, I believe, we will regain. But we didn't have, therefore, a good year. On the [ sales ] so typically are also double digit. They were double digit actually in volume, but less in sales. It's a question of mix. We did a little bit more in OEM things meaning things and it's also the development, I would say of things with larger volume and therefore, lower selling prices for larger. But nothing is broken here. I think we will receive -- we have sold our first to our beta customers.

We have some in the pipeline, but it's fair to say today that given the state of the packaging market where actually a lot of customers are restructuring today, it takes a bit more time to penetrate, I would say, the packaging paper onboard market. But we have, we believe, a solid pipeline that we will see some success in '26. BHS partnership is going on. We have now a number of machines that are installed in [indiscernible] customers. So again, it's more a mid- to long-term play this one. That's very promising.

Now BHS, a very contrasted market. Europe is really stalling, as everybody knows. So for the time being, we have the activity of the European pipeline is quite low, although we are seeing, on the horizon, some improvement due to the adoption of the [indiscernible] directive. The U.S. market has shut down. I think it's fair to say that for the time being, we don't have any activity anymore. However, Asia and Middle East are showing very strong [indiscernible] especially India and China and also some Middle East countries.

And here, I would say we are present in India. We are taking our share of the market. China, we are working on it. I cannot tell you that it's already done. But we do have [indiscernible] over there also. We are not losing market share [indiscernible] really still the product of choice for alkaline electrolyzers. As you know, we have a new plant for which we -- that we are already using, by the way, not fully, of course, but that we're already using and provide already some benefit.

But I think it's fair to say in '26, we are going to probably reach a time where it's going to be [indiscernible] this market before getting back to '27. So '25 there is still modest growth over '24. But going forward, we are expecting '26 to be very much of a dry year.

So if you look at the total DPC for the year and I already commented on it, I would just like to say that it was for [indiscernible] on top line, as you see, [indiscernible] for the first time in many years, I would say, negative growth in EPS. But overall, the division will also, thanks to the good performance of the [indiscernible] pretty much where we want to be for the division for the year with significant improvement.

Okay. I'm going to go quickly. Radiology, I think I'm not going to repeat everything, but the medical field, and the story is about managing the sunset and taking cost out as according to the market decline, which we are still seeing according to our expectations.

DR, what I want to comment is, indeed, we are a bit of -- this is the first time, not sure ever, that the market has contracted significantly in the year. We were a bit surprised by such a strong contraction of 7% globally with some differences between regions. So we had -- we are overperforming the market, but we are still in negative growth as well, okay? So it was also not a very good year. So what we are doing is we are really with the new leader, [indiscernible].

We are doing really a new strategic road map and geographic road map while also taking care of our product portfolio to, I would say, be ready for when the market will turn around, and again this is the message. And in express, the innovation doesn't come so much from the hardware. It's pure AI and software innovation in this area. And this is an area where we have a lot of assets.

So overall, a very difficult year for [indiscernible] but you heard me say that it was difficult for us in the Western European context to remove the cost as fast as we should in a backdrop of market decrease. However, we are getting there and we got there, I would say, in Q4, and we will continue [indiscernible] drop of EBITDA [indiscernible] So it still outweigh today [indiscernible] till this year, but we expect to be slightly different in '26 actually, which is why I think now it's [indiscernible] for the outlook for '26.

What do we see for [indiscernible]? Clearly, we [indiscernible] Clearly, expecting more of the same, meaning progress and momentum on the order intake accelerated transition to the cloud. So we're not expecting to grow profitability in this context given the mechanism of the transition, but we are expecting to be successful in the market, market share and to continue our move forward in terms of order intake.

Industrial Solutions, I think [indiscernible] will get back to growth in '26 even if we remain in the market is probably not really super buoyant. We will make progress. We have reduced most of our range in '25, and we expect to reap the benefits more so in '26.

And as I told you, the difficult point for us for '26 will be Green Hydrogen Solutions. It's a business for which we have quite visibility in the pipeline, and we are getting through what I would call a trough in '26 before a pickup in '27.

Regarding Imaging and Chemicals, we are expecting [indiscernible] '26 [indiscernible] impact in terms of EBITDA [indiscernible] but of course [indiscernible] the situation of the market and also what happens in silver. I'm coming back because we have a specific side on it, but I would like to explain how we are managing the impact and what's going to be the impact. But overall for Imaging and Chemicals, our plan is to have significant improvement over EBITDA for '26 and being a situation where we can [indiscernible] with our cost measures [indiscernible] for '25.

For '26, we are not going to repeat the performance of the positive free cash flow. Why? Because we still have a lot of restructuring and [indiscernible] we need to do to adapt [indiscernible] and we expect, therefore, to have pressure on the free cash flow due to this.

Now let me walk you through the silver price increase. So I would like to remind everyone that silver price [indiscernible] '25 [indiscernible]. Just for your reference, 5 years ago, 6 years ago, silver was $20, $25 per ounce, [indiscernible] shot up in December and January to peak over $100 and now it's about $85. So it's a significant increase. And as you know, we are still today a significant consumer of silver.

So the first message I would like to give you is most of the silver exposure goes -- is from industrial silver business for which we are covered [indiscernible] and automatic passed through to customers. So here, there is no specific risk of not recovering silver. The only part of the market where we are not covered is medical field where we are not indexed. That's also the part that consumes less silver. And here we go for a classic, I would say, classical move, which is increasing prices to our customers.

For the time being, we are seeing this price increase being accepted in the market. The only question mark you might have is the mid- to long-term very high silver price on the demand that could somehow further accelerate the [indiscernible] away from the field. That's a possibility that we are monitoring. But in terms of pass through, the message I want to give is we are able to pass it through.

Now it will have an impact also on us. Actually, the way it works is we buy silver more or less in January to make our film. But the film is going to be a long process, steps, actually in production. It will be sold probably in April or May. The film in [indiscernible] it will take a few months until we get back the cash, okay?

So to make a long story short, we buy silver, cash out in January. And the first significant cash in we are going to get with the new price is in June, July. So it will create a negative cash impact -- working capital cash impact at the beginning of the year. Then we will get impact throughout the, but not fully, during the year. So that's for cash [indiscernible].

EBITDA is a reverse. Actually, we would expect positive EBITDA impact [indiscernible] that would come a bit earlier [indiscernible]. So to make a long story short earlier, positive EBITDA impact [indiscernible] a negative cash flow impact.

Now the situation will be like this still [indiscernible] If silver would be extremely volatile, that could make a variation of what I just said, but not significant. The overall direction of travel will remain the same. But of course, if we have very, very strong [indiscernible] in silver, it will have an impact. But we are monitoring that already for all scenarios and managing [indiscernible].

So I would like to add as well in this context, I'm taking a step back in the transformation order which is between '20 and '25. You can see very clearly the year of the transformation of [indiscernible] between the mature business [indiscernible]. You can see the growth that we have over 6 years and especially, we can see a step up in profitability. So actually, it's a very different company [indiscernible].

And when you take a step back and [indiscernible] that we have switched for the company that was a film company a few years back, 6 years ago, where most of the earnings were coming from film. Today, we are different company, [indiscernible], which you can see that the profit of the film [indiscernible] very much. So it's a good illustration [indiscernible].

Now just a word also on sustainability, which [indiscernible] second action to reduce those CO2 emissions. I insist that these actions are, of course, sustainable actions, but they're also economically viable actions because we're doing so, we are also optimizing [indiscernible] it's not the adversary [indiscernible].

On the contrary, that also contribute to. We're also engaging our workforce in the [indiscernible] improving the presentation of gender. And we are also engaged in the certificate, the safety program by which we have reduced our number of accidents over the past years, but we are divided by 2, in fact, by more than 2 over the past years. So it's -- I'm also very proud of that.

And I think we can say we are becoming more and more CSR compliance, I would say, this year. And we also are ranking on the top 20% of the EcoVadis rated companies. Also the way to check our factory site. I don't have the ambition to be in the top 20%, but I think we should definitely be part of the top quartile [indiscernible].

So overall, and before I will take questions from analyst [indiscernible] actually, I would like just to say in conclusion, well, as you know, we had very difficult '25 due to the accelerated decline of the film and we took the corresponding measures. But of course, there was a time lag between the 2. We are continuing to improve and execute the strategy growth strategy.

And during this phase of solution, we have a very stringent cash and cost management of performance. And as [indiscernible], we could react just like to [indiscernible] significantly in this backdrop. Transformation of the group will continue for the next year. The only thing that will be different, as I told you, is we are not going to go through quite a difficult year [indiscernible] but all other trends [indiscernible].

So now it's time to take your questions. Thanks very much for joining.

[Operator Instructions] We have the first question coming from Guy Sips from KBC Securities.

And just a few additional questions. First, can you quantify how large the early 2026 working capital outflow from silver price inflation could be and clarify whether this cash drag risk tightening covenants headroom during the restructuring peak?

Okay. I don't think we are ready to guide on the precise number for the silver cash flow. But the order of magnitude is -- I mean, the uptick is tens of millions. But at the same time, Guy, we are working on all liquidity measure in the first half. First, continuing what we've been doing in '25, meaning the wind down of the loan portfolio. We have also a few other initiatives that will be part of the compensation for this. But Fiona, you want to give more precision maybe or...

Yes. Maybe I can complement some of that. Yes, I think you are right. In Q1, we would have quite large cash out for silver to fill the pipeline. But you still see there's a seasonality issue because the timing of the charge out, that will come in also later on in Q3 and Q4. We have sufficient, I would say, sufficient other levers, which we take care that this self-purchase which already took place in January.

It will be sufficiently covered because we also ended the year much better, of course. And we also have other, let's say, cash in that we were expecting in Q1. So I'm pretty much sure that we will be able to handle the silver purchases liquidity point of view. Of course, it remains tight, but that will be okay. We will increase our Q1 net financial debt better, but will be okay.

Guy, does it answer that?

Yes, partly, yes. It's already first good guidance. Second question is on Radiology Solutions. And can you elaborate on how do you -- geographic road map and product supply redesign in radiology are expected to mitigate the volume shot that we saw last year and whether you foresee stabilization or further decline in key markets, such as China, for instance, in next or this year?

We are still forecasting the similar rate of decline in China or other markets. So that will still -- that will still go on for film, okay? But today, we have also stepped up very much the level of savings. And as I think I indicated, I think we're going to improve the results of radiology next year, although -- sorry, this year, in '26, not next year. This year, we are going to improve the results of Imaging and Chemicals now what -- so the -- I think we have enough action, okay.

And then the third question is on the HealthCare IT cloud transition. Can you provide more transparency on how many large cloud contracts that were signed in 2025 will actually go live in 2026? And what proportion of today's order book is already, let's say, implementation ready? This could help us on the modeling, the timing of revenue conversion during the trough period.

I think right now, we are entering '26. We have 8 customers in the cloud. We expect this number to more than double at the end of '26. The typical, the number of contracts, I cannot give you that on top of my head, but I would say we have a double-digit number of contracts in the cloud that we made in '25. Typically, as I told you, it's between 9 months to a year implementation delay. So the way what we are looking also as an indicator that probably we will start sharing at some time, which is the annual cloud revenue recurring.

And this is like, Guy, it's a snowball effect. For the time being, it's still very small, but it's going to increase very rapidly over the next years. We will try to come up with the right metrics in the next quarters, but for the time being, we don't do that because it's still a very small part of our business. But as it will grow in implementation, we will continue to report on more metrics on the cloud transformation.

And then last...

Sorry. No, go ahead, Guy.

A fourth question, and then I will queue and I'll leave the floor to other analysts. It's a call without the [indiscernible] It's strange over the last few quarters. So can you give me an update on where we stand?

I'm going to be very clear. I think the situation will be resolved by the end of Q1.

Can you be a little bit more precise?

I cannot be more precise than that, I think. But I can tell you, it will be resolved by the end of Q1.

Okay.

Sorry, at this stage, be more precise. I'm pretty clear, I think. Thank you, Guy. Any other.

There are no further questions at this time. So I hand the conference back to Pascal Juery, CEO, for any closing remarks.

Okay. Thank you. And again, a strong Q4 that demonstrates also the ability of the company to actually react and do whatever is necessary to make sure we can address the challenges we have. And again, in '26, positive on HealthCare IT; positive on DPS where we're going to grow again; positive, also even radiology because we are going to improve our results.

But the only difficult spot today for us is ZIRFON membrane, but that's temporary, and we know it. We have the visibility. Fairly confident that we know that '27 will see a step up, but it is the only negative part for '26. And again, in '26, as you could see for silver, we have -- all our plans are in place. We are modernized a bit where we need to be. I'm not saying it's a walk in the park, but we know how to do the things, and the transformation of the group will continue to take place in '26, of course.

So thanks a lot. Thank you for your attention, and speak to you soon. Bye-bye.

This concludes today's call. Thank you for your participation. You may now disconnect.

Hello, and welcome to the Agfa Q3 2025 Results Conference Call hosted by Pascal Juery, CEO; and Fiona Lam, CFO. Please note this conference is being recorded. [Operator Instructions]

I will now hand you over to Pascal Juery to begin today's conference. Thank you.

Good morning, everyone, and thank you for attending our call. I'm sitting here in Warsaw with indeed Fiona Lam and Viviane Dictus for Investor Relations and some of the executive team.

So what are the headlines of Q3? Well, first, a very difficult situation for medical film with a very strong decrease that calls for more cost actions from our side, which we are taking, and I will explain in more details. But that's the main highlight for the results of this quarter.

Point number two, Healthcare IT, actually, the good news is we are seeing an accelerated shift to the cloud and to SaaS business model. The flip side is it's impacting our short-term results, and I will explain why and how this is the case. But overall, this is good news because in doing so, we continue to see a very good dynamic of order intake and mainly we are able to win net new customers in Healthcare IT.

And three, DPC is, I would say, slightly above last year overall. So here, I would say, a rather steady performance in a market backdrop that is not fully favorable. Pleased with the cash flow performance of the group in Q3, and it's not only about AgfaPhoto, it's also due to the fact that it's -- sorry. It's also due to the fact that we have -- we are managing working capital and other cash components in a very efficient way, I would say. So these are really the highlights of the performance of the group.

Now if I turn into more details, you see that the impact of the medical film and also Healthcare IT with this switch -- rapid switch to a SaaS business model. So the impact on the top line is quite significant, minus 4.7% at equal currency. The only business delivering top line growth is digital printing, but I would say the top line growth is subdued and actually more price driven than volume driven today and mainly in the industrial film area rather than with the growth engines.

Very good cost control overall in this context. However, not enough to make up for the impact of the film decrease. Positive cash flow, EUR 21 million in the quarter. So it's, as I said, of course, due to the AgfaPhoto settlement, but not only, we are also very vigilant in our working capital management, and that provides also significant benefits. And if you look at the cash flow performance after 9 months, you can see a very significant improvement versus last year.

So now a little bit more details on each of the business. Healthcare IT, here, we had the first 6 months where we had quite a significant number of project traditional, I would say, business, and that's reflected on a quite strong performance on the P&L delivery.

Q3 and probably Q4, it's a very different story because the share of SaaS contracts in order intake is increasing significantly, and it means that the project order book is decreasing, while the recurring order book is increasing very much. It has a short-term impact of the transition that I will try to explain later in the presentation on very practical terms. But the good news is that our 12-month rolling order intake is increasing again, actually plus 6%. And we are expecting, by the way, this trend to continue and amplify during Q4, and we'll end up the year with double-digit increase.

The top line decrease is clearly due to this model, this revenue model change, while at the same time, our recurring revenue is growing by 5%, including currency. That also is a good way to illustrate the underlying transition.

Currency is important for Healthcare IT because as you would remember, about 2/3 of our business are in North America and therefore, dollar denominated. So it's a translation impact here that we are seeing. But therefore, it translated to a weaker EBITDA for the quarter.

DPC, as I said, step-up in revenue, profitability slightly up, but we are operating in difficult market conditions, to be fair. So the 5% top line growth is mainly driven by specialty films. The reason being, actually, we have -- it reflects the price increase we have achieved following the especially silver price increase.

However, the performances of Green Hydrogen Solutions and Digital Printing Solutions are more influenced by softer market conditions. In ZIRFON, we see very little growth over last year. We continue to make progress in terms of productivity and especially it will be even more the case with our new plant. And in DPS, we're operating in a more difficult market context actually, especially in North America for equipment, where we have seen a significant slowdown. So these 2 businesses are, I would say, more impacted by the current market conditions.

Radiology is where we see the most significant decline. Our revenue is declining by 20%. Actually, what happens is the China market is disappearing quite fast. Today, this market that used to represent about 45% of our total volumes has been divided by 3 in the course of 2 years, and the trend will continue until the fast disappearance of the market that might be as fast as the end of '26.

So actually, what we are seeing here is a bit of a race between taking the corresponding cost out of the business and the market decline. And for the time being, we are behind because it's not possible in the current social agreement to, I would say, go as fast as we need. So what we are doing is, I will detail in the -- actually in the next slide, what are we doing to face the situation.

First, we had a 3-year program and a EUR 50 million cost decrease program. Actually, we are bringing it forward, meaning we are accelerating the program, things that we plan to do in '26, actually, we start doing in Q4 '25, and we are going to try and condense the program in a short-term time frame in order to have the maximum impact in '26.

But not only that, we are launching an additional program of EUR 25 million related also to manufacturing activities. So it means we are expanding the current EUR 50 million program for manufacturing, but we are also touching a new area. We are going to adjust our go-to-market for film, and that will also be a significant cost-out program indeed that is actually ready to go.

We are starting the discussions with our social partners, and we will start implementing as soon as we can. We are -- we have also implemented some short-term cost saving measures across the group that will -- for which the benefit will mainly be seen in Q4 to make sure that we mitigate the current results group. And we have also launched an initiative to right size the overall group organization. I cannot communicate any details for the time being with you, but we are actively working on resetting the group cost base to the right level and the new situation that we are seeing in the field.

And last but not least, as already communicated, we are working on the potential redevelopment of part of its site in Mortsel and we have actually started a discussion to have a brownfield covenant. As you know, we have a campus in Mortsel that is probably quite for the size for our needs, and we are trying to look at the possibility to monetize part of it.

So we are not staying idle in view of the current situation that we are seeing in the field. We are addressing this at first and we already have a lot of programs in place, but we are already -- which we are also working on more in order to secure the profitability of the company.

Now if I turn to numbers, you will see the impact of -- which is, by the way, not currency corrected here. You see the strong impact of the decrease of the radiology business here 20%. You see also the decrease in the HealthCare IT top line. But here, again, we are winning share, but the transition to cloud means our bottom line is impacted and the growth in DPC, slight growth in DPC.

And you see on the right-hand side, the corresponding effect on our bottom line, less top line for HealthCare IT is translating also to less bottom line stability plus for DPC and radiology results that are still very negative, hence, the actions that we are taking.

If you look at -- we show this slide with our mature businesses and our growth engines, I would say what we are seeing here for the first time is we have a negative performance of the growth engines, mainly due, in fact, to HealthCare IT and the situation that I explained. And for the first time in many quarters, actually, we have a bit of a setback in terms of the growth engine businesses.

But again, I insist it's not the case that we are losing share, actually, absolutely not. We are doing extremely well in HealthCare IT. Most of what you see here is the impact of this cloud transition that I'm going to detail in a few numbers for you.

I'm going to turn now to Fiona to walk you through more numbers. Fiona?

Thank you, Pascal. Like Pascal already said, Q3 adjusted EBITDA ended at EUR 5 million, which is EUR 10 million down versus last year. And you see also the exact numbers coming from the bridge, which was a decline in medical spend on gross profit only in radiology context has an impact of -- negative impact of EUR 7 million and also temporary impact of HealthCare IT due to cloud and SaaS transition. So that also in Q3 has a EUR 4 million lower gross profit.

Unfortunately, there's also unfavorable exchange rate impact. So you see also exchange rate unfavorable impact of EUR 2 million. Good part of the cost control, like Pascal earlier also mentioned, we control the cost pretty well. And there you see offsetting part of this downside on the market, and that led to EUR 10 million lower EBITDA in -- adjusted EBITDA in Q3.

On the other hand, we look at free cash flow of Q3, which is a positive of EUR 21 million, despite adjusted EBITDA -- lower adjusted EBITDA of EUR 5 million. That, of course, has been helped largely by the AgfaPhoto's income, which is in Q3.

On the other hand, we also have say that lower CapEx investment fee -- sorry, working capital improvement. This is worth to see also Q3 working capital improved by EUR 16 million, and you will later on also see the working capital improvement is significantly contributing to the group's free cash flow in the first 9 months as well.

CapEx is slightly higher than last year. As you know, we have still other investments, which were paid in Q3. Provision others are seasonality, you will not see any increase or decrease too much. It's stable if you look at the 9 months, this is just quarterly seasonality. The rest is quite stable, like adjustments and restructuring, et cetera, is quite stable compared to last year.

Next slide related to the debt evolution. You see Q3, we reduced the net financial debt excluding IFRS 16 by EUR 20 million with the cash in of AgfaPhoto. The rest of the debt also the pension debt slightly decreased in line with expectation. And if you look at the syndicated loan withdrawal of EUR 119 million versus the total facility of EUR 118 million has been quite roughly stable on syndicated loan withdrawal.

Applicable covenant test for Q3 is the minimum liquidity of EUR 30 million. There we have in Q3 2025, EUR 126 million on the minimum liquidity. The rest of the covenants are only for reference. So we also share with you the references of the ratios, but they are not applicable for testing until year-end, which is the leverage ratio, the interest coverage ratio and the adjusted EBITDA is IFRS 16. This is the ratio for your reference.

Next slide is a bit more on the numbers, which you can see now the P&L. Q3, the growth was minus 7%, but year-to-date is minus 4%. That has been helped by the first half year strong HealthCare IT. Q3, like we just said, the cloud transition is very, very evident visible. And therefore, we also see HealthCare IT did not grow in Q3. The full year until first 9 months is minus 4%.

Gross profit slightly decreased because of the mix as we have industrial film are the main growth areas in this year and then the first half year of HealthCare IT, but of course, because of the film under loading and the mix of growth, we see a slight drop of gross profit percentage.

What is good that you also see the first 9 months operating expenses with the top line reduced the good cost control has delivered and maintained the percentage at 30% in the trend top line of lower top line. That led to year-to-date adjusted EBITDA of EUR 19 million versus last year.

If we look at next slide, which shows the net results, thanks to the help of basically AgfaPhoto, both on EUR 38 million in adjusted restructuring expenses and also the interest income and net finance costs, which lowers it. So you see a net result for the period of EUR 20 million improvement compared to last year for the first 9 months.

Also to mention about -- have a look at the free cash flow in the first 9 months, despite our adjusted EBITDA has been lower for the first 9 months by EUR 19 million. You clearly see here we improved the free cash flow for the first 9 months by EUR 72 million, even though it's still minus EUR 9 million negative, but this improvement is enormous. So it's not only because of AgfaPhoto EUR 38 million cash in, in this free cash flow, but it also has EUR 51 million improvement in net working capital in the first half -- first 9 months.

Part of that, of course, in the net working capital improvement, you can anticipate because you are doing lower volumes and lower turnovers. On the other hand, a part of that is also really structural improvements because we also see between 2% to 3% improvements to sales on the net working capital, primarily driven by industry controls, et cetera. And we also compared to last year on the first 9 months, we spent less on CapEx. And therefore, you see in total EUR 72 million step-up and this is quite important, of course, contribution to our free cash flow position.

Thanks a lot, Fiona. Let's go also very quickly to HealthCare IT to the details of the business.

Well, I'm kind of repeating myself, but here, what you see for Q3 is 70% of the order intake is in the recurring part and 40% is in cloud deal. By cloud deal, we mean SaaS deals, okay? The difference, the 30% is some deals that are also recurring that can be cloud, but not SaaS and that could be managed services. So you see that this is a shift that is extremely significant.

The good news is 70% of this order intake is done with net new customers. So it's a very good sign. It means we are winning share here, and we are winning contracts against the leaders of the industry. We are leading -- we are today winning contracts competing with the likes of [indiscernible], for instance. We are exactly on par, I would say.

Last 12 months rolling order intake is plus 6%. As you know, it's pretty lumpy. Last year, we had a very high Q2. This year, we believe we are going to have also a very good Q4. So we believe, we're going to end up the year with mid- to high teens in terms of progress for order intake. And as you know very well, the leading indicator for us that describes our ability to win business.

So what we are seeing today is a faster transition to the cloud and probably a bit faster than what we originally thought in the past quarter. Today, I would describe it in this way, all North American discussion more or less is a cloud contract. There is not anymore, any possibility of project contract. We thought that the mix would still be a bit different a few months ago, but this is a market reality. And the good news is we are able to take new contracts in this context.

Now we added a slide to show you what is the impact of transition to the cloud, okay? And you see here on the top part of the slide, the traditional project revenue profile. When we take a EUR 10 million contract, we have EUR 10 million revenue on the year. So we invoice EUR 10 million with the corresponding gross margin, which for us is about 50%, as you know. And then we have the recurring maintenance and some managed services. And you see it's quite -- it's about 20% to 30% of the amount of the total contract.

Now take exactly the same contract and get it in the cloud. You are not invoicing the first year 10, you're invoicing 4. That's a 60% decrease in top line, okay? That's a 60% decrease. And then what you are seeing over -- actually the course of the year, here we ended the numbers is actually an increase year-on-year, a small increase that is not only in year for all purpose, but that we are invoicing year after year.

So the contract is definitely richer in cloud. This is a longer-term contract. Typically, the traditional project is selling the license and have for the 3-year contract for maintenance that can be renewed. Here in cloud, we are talking 5 to 12 years contract actually that could be as long as, yes, double digit in terms of years. Of course, stable and recurring revenue streams.

Switching customers. Switching is more difficult for customers, of course, and we have profitability uplift driven by the strong operating leverage, meaning we can make more money over time. However, when you look at the 2 models, it takes 5 years to breakeven. And when we are entering in such a transition, the short-term impact is quite significant on the top line, but also on the bottom line for the first year. So this is what we are seeing. We are not seeing, of course, a 60% decrease in top line overall for the group.

As you've seen, it was minus 13% because it applies only to the nonrecurring part of our business, but it is still a very significant impact. And what we are seeing today, as I said, is actually more and more SaaS contracts coming our way. Good news is we are winning these contracts, but it has an impact short term on this year. I wanted to be clear about that. So again, nothing is broken in this market. On the contrary, we are well positioned to grab these SaaS contracts, but it has a short-term impact.

Now if you look at the numbers, you see minus 13% in Q3 in terms of top line. And of course, it has an impact on the bottom line due to this mix of contracts. This is the same slide with the P&L. To be noted after 9 months, we are still above last year. We had a year where the first half of the year, we have more project business in the second half had mainly SaaS and cloud contacts, which is a reason of the difference between the 2 halves. Q4 will still be by far the strongest quarter of the year, of course, as it is usually the case.

Now if I turn to DPC -- DPS first. DPS is a business that was growing about 12% per year the past couple of years. And this year, it's not the same performance. Mainly what we are seeing is the North American market, equipment market that is very subdued. A lot of our customers in the U.S. have been delaying their decision -- their investment decision. This is due to the uncertainty in the economic policy with the change that happened at the beginning of the year.

Although we are a little bit more optimistic for the end of the year, it definitely it has impacted, I would say, the business and therefore, for this business in an adverse market environment, we believe we're going to be slightly below last year, or best performance would be to be almost on par.

Seeing sales growth has slowed as well in such environment, but has not disappeared. So nothing is broken here in this market. We are hitting, let me say, short-term difficulty, but our strategic growth initiatives around packaging are going on. Here again, the packaging market where we want to operate is actually in recession today with negative growth, which probably slows down the introduction of our solutions. But it's really a temporary situation, and we remain extremely confident with our growth initiatives going forward.

Different -- actually, very different situation in Europe and outside Europe. Today, Europe is stalling a bit in terms of doing the transition into green hydrogen. And we have not a lot of projects in Europe compared to the original ambition of the commission. However, Middle East, Africa and especially Asia are showing great momentum in green hydrogen, and this is where we have redeployed our efforts.

And actually, the 2 main countries where we are applying our efforts today are China and India. With some success already in India, and we believe that in China, we will be also able to, I would say, break the market for [indiscernible] due to the sheer quality of our membrane. So apart from that, as you know, we have inaugurated our new unit for the membrane. And we are meeting today all the conditions to receive the subsidy of the European -- of the European Commission that we will get before year-end. We are already using the new plant. It's already providing some more productivity improvement. And therefore, this year, even if it's -- the growth will be quite subdued, actually we continue to increase our margin through this productivity improvements, so that's more different.

So now in numbers, as you can see, DPS before Q4 in negative growth territory overall. We still expect Q4 to be a very strong quarter as usual. For ZIRFON actually some growth, but probably not at the level that we were expected. And the growth in the film part is mainly price related.

So in numbers, good stability of DPC. We probably we are expecting growth in DPS that we are not seeing this year. But again, nothing is broken in this business. Radiology, medical film, this is, of course, the negative story of the -- now already more than a year and especially in China and the rate of decrease of the market is probably higher than what we were expecting from our experience of what we have been through already in Europe and North America. The market will probably disappear quite quickly, meaning that we are taking action to further restructure, I would say, our cost base and also address our go-to-market.

DR, a very specific situation this year because for the first time in many, many years, I think for the first time ever, the market environment is very negative, 7% decrease of the market for the first 6 months of the year, and we are directly impacted by that. We used to grow DR, I would say, high single digits. This year with a negative 7% market, we are in negative territory also for DR, which came also a bit as a surprise.

We are reviewing our geographic footprint as I speak to make sure we are really investing in the right markets -- geographic markets for us as well as reviewing our product supply strategy in order to continue our ride for DR. So that's you see still in the numbers, so needless to say, this negative EBITDA situation is what is prompting us to accelerate and extend our cost-cutting programs. And this is the P&L. As you see, we are evacuating cost, but of course not fast enough given the rate of the decrease.

Now the outlook. HealthCare IT, we believe the transition to cloud will continue and will probably continue to accelerate in terms of SaaS contract. So it will impact temporarily our financial performance. And therefore, we are changing a bit outlook in this context, saying that we expect now to be slightly below last year. But again, the good order intake momentum continues and the fact that we are gaining customers is giving us a lot of confidence going forward. It's a normal situation of a transition and go a little bit faster than expected, but we are well positioned to take advantage of it.

And again, in the total number of suppliers in the market for HealthCare IT, actually, we are part of the [indiscernible] issue. We are ready to be able to grab market with this foundation. DPC moderate top line growth, slight profitability growth expected for the year in spite of the soft market conditions, a bit of less growth story for DPS to perform, but still holding our own in this condition. Radiology I think I already discussed it.

A word on settlement because there is some news here. We have actually received a draft report from the experts actually. So things are moving. And the draft report, I would say, is very close to our expectation. We have now -- we should have by year-end the final report after the parties can also give some input. And therefore, for the first time, I have something very tangible to report and we should expect in Q1 a resolution -- in Q1 '26 resolution of the release story. For the year, we still believe, and we have not taken into account, of course, the settlement, we still expect a slightly negative net cash flow.

So that's probably where I'm going to stop for your questions. And I will take questions from the analysts and from the press. Operator?

[Operator Instructions] The first question today comes from the line of Guy Sips from KBC Securities.

Yes. Three questions from my side. First question is on the Packaging Printing segment. Can you indicate why the mid-segment is still performing quite good? And yes, how it is separated between, let's say, bigger machines and the smaller ones? And can you also give us an indication on the number of Orca's you sold in the quarter and what your expectation is for the remaining of this year? That's the first one.

And the second question is on your net debt situation and especially on the, let's say, the updated slide you gave on the pensions, which is, of course, very helpful for us. But now you can give a quarter-on-quarter position of your net pension debt, while previously it was...

We lost you...

We seem to have lost connection with Guy Sips. The next question comes from the line of Laura Roba from Degroof Petercam.

I have 2 to start. First of all, regarding the cost saving plan. So the current plan is being accelerated. And did I understand correctly that you mentioned that what was supposed to happen in 2026 will take place in Q4? That was the first one. And then the second one is on the short-term measures that are implemented across the group to help mitigate the current results. Could you provide some example of that, please?

Yes. Of course, thank you, Laura, for your questions. Cost saving plan, actually, we are not going to do in Q4 '25, the full of '26, but we have brought forward a number of things. And for instance, as an illustration in terms -- we had a schedule for people leaving the company. And actually, we have added a lot more people leaving in Q4 '25. The total plan we mentioned was about 470 people, and we have put forward like about 100 people in Q4 '25.

And that's just to give you an example of how we are accelerating, but it doesn't mean that we do everything that we plan in '26 in Q4 '25. We do as much as we can, actually.

Okay.

And regarding the short-term measures, well, I would say, our short-term measures are very diverse. For instance, that's what I described regarding what we are doing to anticipate is part of it. But we are -- it's clear we are taking measure about discretionary expenses, travel, hiring, of course, which are the classical set of measures.

We are also very careful to make sure -- we are exhausting, I would say, vacation and over time before year-end. And we have also taken some extra measures, which are quite significant because we have -- actually, we have put a significant number of people in temporary unemployment until, I would say, the end of the year. That's some examples of the short-term measures that we are taking.

We'll give the line back to Guy Sips from KBC Securities.

So we got your first question, Guy. The second question, you didn't -- we didn't hear until the end.

Yes. Just on the net financial debt and pension debt. So now you give on a quarterly basis an indication of your net pension debt, while previously, it was only possible on a full year basis. What has changed with the auditors in that regard? And so is it now expected that at year-end, we will see smaller shifts on -- like compared to the EUR 391 million number? That's the second question.

And the third question is related to Aurelius. So am I correct that you hinted that in your view that you expect now a solution or -- and a payment in the first quarter of 2026 and perhaps even earlier?

Well, let me -- let's start by net debt, and I'm going to give the floor to Fiona.

I think on the net debt question, there has been no changes of methodology. It has been always available in the balance sheet on the half year quarter year results release. The only difference is that I think at year-end, there's actuarial calculation. This actuarial calculation is only happening at year-end. So what you see in the quarter, every quarter, the evolution is actually the pay the people who die -- the update of the position of that. Until year-end, we will also update the actuarial calculations where the discount rate, the interest rate, all those calculations will be done by the actuarial.

Does it clarify, Guy?

Okay.

On -- I'm going to take the question on Aurelius. Well, Aurelius, as I said, we have now a draft report and the expert has given, of course, some time for the 2 parties to make their comments. And the current time line is we should get the final report after she took the comments, the expert takes the comments and decide what to do with it, so to speak. And we expect a final report at the end of the year.

So realistically, we say we should be -- we should have a settlement in Q1 '26 given the time, we have 6 weeks until the end of the year. But I think for the positive news is -- 2 positive in this story. First, for the first time in more than a year, I mean, almost 1.5 years, things have moved, and we have now a practical report from the expert. And the second part is for the time being, what we are seeing from the expert is according to our expectations.

Okay. And -- but the payment realistically, Q1. Okay, on this...

Okay.

And now the packaging question. Well, on the packaging question, I just want to rephrase to understand if I understand, if I got it well. For Orca, you're asking us specifically, have we sold any SpeedSet? The answer is not yet, okay? The answer is not yet. We are going probably to sell our first SpeedSet in Q4 to our existing customer, but the contract is not signed, but should be signed, I would say, before year-end.

But apart from that, no other Orca being sold. And this is, as I said, 2 reasons. First, the packaging end market today is not really favorable for our customers to invest in digital is probably a solution, they are willing to implement when they have the opportunity to increase their capacity. But so -- and the sales cycle for such product is a bit longer, of course, given the situation.

And on the packaging printing, I mean, you made a comment on packaging printing regarding low and mid-range. That I'm not sure I understood fully your question.

Am I correct that the mid-segment in the packaging printing is doing rather good compared to the, let's say, the small segment?

Actually, we have no mid-segment in packaging. We are -- the only thing we do in packaging is really Orca. So maybe what you refer to is more our traditional sign and display business...

Yes. Yes, sign and display, yes.

[indiscernible], can you comment? Mid-segment, low segment? High segment.

So indeed, in the Sign and Display segment, I would just -- which is our traditional segment and today, 90% or so of our sales. That part -- and that part of the market we have seen this year specifically that people are postponing investment decisions on the larger type of equipment. So we certainly don't see a slowdown on the smaller and midsized equipment printers, but the larger-sized printers or tower range, which is still very much appreciated technically, but is indeed people are taking less quickly or postponing investment decisions. And we do hear that in the market from other players as well. So it's not only an Agfa thing, it's really a market given, especially in North America actually for '25.

Thank you, [indiscernible]. Next question.

We currently have no questions coming through. [Operator Instructions] We seem to have no further questions. So handing back to you, Mr. Juery for conclusion.

Thanks a lot. So again, a quarter that shows, first, situation in film that we are addressing with all energy through cost measures, amplifying and speeding, accelerating our measures. A transition to cloud for HealthCare IT that happens probably faster than we expected. But good news being we are on the winning side of this transition.

And third, a DPC that will broadly deliver a slight improvement in profitability, but where the adverse market conditions have somehow dampened our hope for more rapid growth with the backdrop of a very stringent cost management and cash management at the company level to ensure, of course, the company profitability. Q4 will continue being the strongest quarter of the year as it is, although these trends will also apply to Q4 for film and HealthCare IT.

So thanks a lot for attending the call. Thank you, and speak to you soon.

Thank you for joining today's call. You may now disconnect.