Bechtle Stock

Such strong interest in today's Capital Markets Day. Thank you for joining us here in Frankfurt. And of course, an equally warm welcome to everyone participating online from across Germany and around the world.

Before we begin, let me mention something that will not come as a surprise, especially to most of you. After nearly 20 years with Bechtle, this will be my last Capital Markets Day as CEO of the company. As you know, at the end of this year, I will hand over responsibility to Konstantin Ebert, who is with us today and already known to many of you from past events. I felt it was only appropriate to take this opportunity to say thank you and goodbye personally in this circle.

That said, with a view to my right and to my left, I would like to point out that today is only September, and I remain fully in office until end of '26. So there are still a few months left before anyone finally can get rid of me. Nevertheless, opportunities like this become less frequent, which makes me particularly pleased to be here today to exchange views with you and to spend this day together.

As you already read, the theme of today's Capital Markets Day is always prepared for success. This is one of the core messages of our Bechtle vision published this year in February. On a personal note, it was especially important to me to help shape a clear and sustainable vision together with 6 so-called mission statements for the future direction of our company.

For me, this has always been part of responsible leadership, ensuring that Bechtle is not only successful today, short term on a quarterly basis, but also well structured, strategically aligned and fully prepared for the future. In that sense, helping to hand over a strong company and a clear strategic framework to my successor is something that really personally matters to me. The fact that our vision provides the motto for today's Capital Markets Day also fits perfectly with the agenda ahead.

Starting from the CFO's view on our vision, we will focus on 2 key pillars of Bechtle's future success. The first is the continued internationalization of our business. This is an important strategic growth area for Bechtle, and you will hear more about it from Konstantin Ebert and James Napp, who is responsible for our business in U.K. and Ireland. The second pillar is one of the most important topics in our industry today, activating the potential of artificial intelligence in everyday business operations and especially customer solutions. On this topic, our CTO, Dirk Müller-Niessner, will share his perspective and our approach at Bechtle.

Ladies and gentlemen, before we now move on to my colleague, Christian Jehle, our CFO, and as I like to say my partial successor, we would like to set the scene with our vision video. So again, thank you for being with us today. I'm looking forward to an insightful day, valuable discussions and as always, as I know, an open and stimulating exchange with all of you. So let us start with the video.

[Presentation]

Good morning, and also welcome from my side. Today, I would like to talk about our financial ambition for 2030, the plan that we have built, the journey that we're on and where we are at present and what the next steps are.

Now before we do that, let me put a few things into perspective. When we look at our performance over the last 10 years, what we have delivered is really strong double-digit growth. So when we look at the business volume side, we delivered 12% CAGR over the last 10 years. When we look at the bottom line, we delivered a CAGR of 10% over the last 10 years. So strong double-digit growth of the company over the last 10 years.

Now when we're zooming in on this year, on 2026, what we said as a company is that we're going to grow the top line between over 10% year-over-year, which means we're going to arrive at a business volume of more than EUR 9.5 billion for 2026. When we look at the bottom line, what we said we would do is grow that by 5% to 10% year-over-year. And when we then look at the margin as EBT in percent of the business volume, when you look at the capital market expectation, that would leave us at a expectation of around about 3.6% for the year 2026.

Now fast forward, looking at our ambition for 2030, what we stated was that we will deliver a business volume of more than EUR 10 billion we will deliver an EBT margin of 5%, which would then mean an EBT volume of more than EUR 500 million by 2030. So that is to put the whole thing into context what we said we would do, where we are today and where we're going to go over the next 4 years. Now when we look at the marketplace that we're operating in, we can clearly identify 4 major trends that are important to drive growth.

Number one is AI. So AI is everywhere in our customer base in all processes that we operate and that we see. What we also see in the marketplace is a clear trend around digital transformation and the renewal of infrastructure and the requirements in our customer base to do so. The third trend we see is around cybersecurity, around sovereignty and around the cloud infrastructure that is being provided in the marketplace, and that is driving growth as well. And the fourth component is skill shortage, especially in the IT market.

So those are the 4 key trends that we see that are driving growth in the marketplace. Now the question is how are we as Bechtle positioned to succeed in that marketplace? And we have 4 topics, how we address that. Number one, we provide expertise at scale. So take, for example, the topic of cybersecurity. We have built an organization within Bechtle that covers more than 900 people that are building solutions and are delivering those solutions to our clients in the cybersecurity space. So we are really well prepared in that area.

When you look at our customer proximity, we operate in more than 120 locations, really close to our customers. We operate in 14 countries all over Europe, again, being very close to the customers, understanding their requirements, understanding their strategy and helping them to succeed. We have a really vast vendor ecosystem. So we work together with more than 270 OEMs all over Europe to deliver the best solutions to our clients.

And last but not least, we provide end-to-end delivery. So whatever product we deliver, whatever solution we provide, we always cover the entire value chain from design to delivery to maintaining the solution. So when we look at how we're positioned in the marketplace, that gives us a lot of credibility and a lot of confidence to deliver on the growth ambition within the marketplace.

Now results are not only about top line, but they're also about profitability. And when we look at our journey to 2030, we have identified 3 focus areas that we are concentrating on to drive profitability across the group. Number one, we're focusing on organic growth and product and service mix, which means we're going to grow within the markets that we operate in, and we're going to strengthen our services business.

The second topic is around productivity gains. We have identified specific levers that we are addressing that we are building on to drive profitability across the group, and I'll come to that in a minute. And the third topic we're focusing on is M&A. So I think you all know we have a quite successful track record of acquiring and integrating companies, and that is another area that we're looking into.

Now what is important to note is the size of the boxes tells you something about the contribution that we expect from each of the 3 areas in terms of improving our level of profitability across the group. In a nutshell, what it means is we're not banking on M&A activities to drive profitability. It's going to come from the first 2 areas to the largest extent. That's the way how we want to get from 3.6% to the 5% of EBT margin that we are targeting.

Now what are the key levers to drive productivity across the Bechtle Group? Number one, it's global process harmonization. I think you can imagine that if a company has acquired more than 120 units over 40 years, the process landscape is probably not as harmonized and not as streamlined as you want it to be. So what we have done is we've launched a specific program to address that topic, which gives us the foundation to drive more productivity across the group. We've established a specific team that is addressing that matter and that is currently in the process of being rolled out across the Bechtle Group to drive that program.

The second topic we're focusing on is the go-to-market approach. So we launched a program to look at our service offering, to harmonize it, to standardize it and to use best practices across the group. The important point there is we have a quite decentral go-to-market model right now. We don't want to abolish that, but what we want to do is we want to enhance it. We want to make it stronger, and we want to use best practices across the group really globally.

And the third topic we're addressing is technology and AI. And there, we have 2 areas. One is the investment into our own infrastructure. So I think we shared it with most of you. We have launched an S/4HANA transformation program, quite a substantial one, cost us a lot of money with major expectation in terms of productivity improvements there. The second topic is we're investing into our own cloud infrastructure to provide solutions to our clients. And the second focus topic is AI, and our CTO, Dirk Müller-Niessner, will tell you more about the AI program later today. So these are the 3 productivity levers that we have identified. We have launched programs to drive performance across the group.

Now the question is, of course, how do we measure and how do we manage productivity? And besides the usual ratios around gross profit and gross margin and EBT margin, we have also established a KPI that we call EBIT as a percentage of gross profit. And when you look at our performance over the last 10 years, on average, we've achieved a score of around about 32%. So 32% of the gross profit we have achieved is arriving at the bottom line. That is something that is quite a strong performance. When you look at 2025, we did 28%. And our ambition is for the -- to achieve the targets we set ourselves for 2030, we'll be north of 30% for that KPI.

Now the question is, where do we see potential? And you can see it on the right side of the slide. So 2 messages there. Number one, when you look at the KPI performance, you see the 28% for the group. But you can see that in the various segments, we have a different level of productivity right now. So in particular, in France and in the segment other Europe, there is potential to improve. So if we want to get them to group standard, there is room for improvement.

The second thing you can see is the EBIT margin as a percent of business volume in the various segments. And you see a gap between the performance we have in Germany and the other segments outside of Germany. Major driver there is the level of maturity. I think all of you know, we started the business in Germany. So in Germany, we've had the chance to really optimize processes and organizational elements over the last 30, 35 years, whereas when you look at the areas where we have acquired businesses, they are less mature.

So what we're trying to do is, number one, get them to the same level of maturity and also to provide the same breadth and depth of the service offering that we have in Germany. Now that is how we want to drive profitability. As I mentioned before, we have 3 focus areas and majority of the contribution is going to come from growth, product and service mix and the productivity gains that we talked about.

Now we talk a lot about the P&L. But what we also want to emphasize is the need to focus on cash. So we treat them as equal. And for us, it's extremely important to demonstrate how we're converting all the profits that we're generating into cash. What you can see on the slide is our performance in the cash area. So for example, when you look at our operating cash flow performance, we delivered EUR 290 million last year. Quite a strong performance, and it shows you how cash generative our model is.

When you then look at an efficiency metric in the middle, like working capital as a percent of the business volume, you can see that has come down substantially over the last years. And that shows you how much better we have become, a, in managing our own supply chain; and b, when you look at how we've run cash collection over the last years, we have quite substantially improved performance there as well.

So there's more to come, more to do. And I think we've proven over the last years that we know how to optimize our performance in that area. And on the right-hand side, you see the cash conversion ratio, and we've done 59% in 2025. When you look back 10 years, quite a substantial improvement there as well. So I think what we have demonstrated over the last years, we cannot only generate profits, but we're also highly cash generative. And we know how to manage a supply chain, and we know how to improve working capital.

Now when we look at our capital allocation policy, the headline is what you see on the slide. It's really all about investing for growth while maintaining financial discipline. So the foundation for all that is what you see on the left-hand side, strong operating cash flow in combination with a sound balance sheet. And I think at Bechtle, we have demonstrated that this is a solid foundation for us as a company over the last 35, 40 years, a really solid foundation that we can build on.

And we have 4 focus areas there. One, we will continue to invest organically into our growth potential, invest into our people, into our skills, into our infrastructure. The second topic is we will drive targeted M&A projects like we've done in the past. And when you look at our track record, we have acquired 126 organizations over the last 40 years. So on average, 3 or 4 a year. I think that's quite a track record.

When you look at the contribution we have received from those acquisitions, it's more than EUR 1.5 billion of business volume over the last 10 years. So also quite substantial there. Again, I think we've proven it. We know how to do it. We know how to acquire companies. We know how to identify the right targets, and we know how to integrate them.

Third topic is around financial resilience. So we will make sure we stay on course and manage the company accordingly. And the fourth one is our dividend policy. If you have followed us over the years, you know that we spent about 1/3 of what we generate on dividends, and we will continue to do so. Now when you look at the whole picture, let me explain how all the components that I talked about today are coming together in order to support our ambition for 2030.

We've talked about the market that we're operating in, and I explained the 4 key trends that we have identified that drive growth and demand in the marketplace. We also talked about how we're positioned in the marketplace and how we will be successful in the market that we operate in. We will not only focus on growth, but we also have a very strong focus on driving productivity and profitability across the group and address the levers that I explained today. And when you then put the whole thing together, it's not only going to be the P&L that we focus on, but we will also generate cash accordingly and drive shareholder value that way.

So in a nutshell, we have all the components we need. We've shown that we can do it, and we will continue to drive in the same direction. And that means we will deliver business volume of more than EUR 10 million by 2030, and EBT margin of 5%, and we will deliver an EBT volume of more than EUR 500 million by 2030. That was all from my side. Thank you very much. And with that, I'd like to hand over to Konstantin.

Thank you very much, Chris. Good morning, everybody. It's a big thank you from my side that you're joining us today. It's actually my second Capital Market Day. I learned it earlier a few years ago when I was fortunate to give an update of our more early-stage M&A strategy in our internationalization. I know you slightly look at me differently today, as Thomas Olemotz pointed out earlier. So I'm really looking forward for the next years, engaging with you more regularly and yes, doing these formats together and be counterpart for you in your questions.

So with that, I would like to give an update today on our international expansion and our internationalization strategy. I also brought one of my colleagues with me, who will give you a more real-life update later on how we are doing this. And with that, let's start.

Internationalization. It's, of course, a very element -- a very important element for us of growth. We are in 14 markets today in Europe. We are clear #1 in Germany, and we see a lot of potential to further grow in our markets across Europe. So of course, our strategy of acquiring companies as well as organically growing, the internationalization is, of course, a very important element of growth.

But not only that, it is also an important element of resilience for us. Resilience, of course, because we can better react across Europe to macroeconomical circumstances to the different markets. We can better balance, we can better balance resources across different markets. So it's a big element for us to operate more resilient and reduce dependencies on single markets.

The other element is customer relevance. We see customers reacting very positively when they have partners like us where they can rely on having an access across many markets, and I will explain a little bit more how we even do that outside our 14 markets. But even just those 14 markets, those 14 core European markets from our point of view, are big element for customers and putting their trust into us as a strong partner, delivering their projects across countries.

The internationalization matters because, as I just mentioned, it gives us a much more balanced footprint across the markets. We see that in coverage with our OEM vendors. We see that with customers, as just mentioned. So we are much more balanced and able to react. It also gives us good access to larger customer opportunities. We have significantly won large customers across different countries.

And we are also with our internationalization, more and more winning significant customers out of those markets where we are investing and becoming more relevant because they locally see us as a much more -- much stronger player than years ago. One thing that we are sometimes forgetting is that one key element of our business is our cooperation with the big vendor partners, the OEMs, all the big IT companies from around the world. And they very much like our strategy there because they really appreciate working with large international partners. For them, it's a way of making their business easier. It's a way of looking into some consolidation there.

So they have one big company to go to, and it is for us a very important element. And when you look at our ranking with key OEMs, we are typically despite being in 14 markets across Europe, but typically with all the key vendors somewhere in the rank of the first 1, 2, 3, 4 partners on a global level even. So we continue to drive significance for the large mostly American vendors driving their portfolio and they're helping them generating projects across Europe.

So this is a very important element. But also the increased operational resilience is important. We are not just from a go-to-market point present in Hungary, for example, but we also have today a large internal IT team based in Hungary. So we're cross leveraging our presence across different markets. It gives us a more resilient access to qualified staff across market. It allows us to leverage cost benefits across different markets.

So we are continuously developing hubs like be it in Czech, be it in Portugal and so on to also leverage our internal processes and teams, and that's also an important element of our resilience. So we're not just acquiring companies, but we are combining it quite smartly, I would say, with our entrepreneurial growth. We have always built on a very decentralized network with our companies with a strong entrepreneurial close to customer mindset and our teams, and we're combining that with the element of our M&A strategy.

And what you will learn later on about our U.K. development is a great example for that. And so we have -- we're really putting effort into our organic growth. We're not, of course, not neglecting that. The teams we are building, we're growing that. We're driving the expertise we have. With the acquisitions coming on top, we are building models where we are really leveraging the enhanced portfolio to cross-sell and not just use it as market share, but really use portfolio elements, strength of the companies to cross-sell and to leverage each other much better.

And the internationalization is also creating a big element of adding new capabilities. We regularly acquire companies where they have a very specific expertise. For example, we acquired last year, a company called ITAM in the Netherlands, very specific on TCO optimization around software management. And we start leveraging across our 40 markets, not just in the Netherlands and not even just in the Dutch customer base, but even across.

So these capabilities we're adding, we make them available across the group. And by that, we drive a much better portfolio breadth and depth in the markets where we acquire, but also across the markets. And of course, M&A, that is an accelerator as well as an enabler of our local sales teams and helps us in the local markets where we acquire across and across the markets.

So we are expanding our strength there across all our markets. We have a 14-country ambition. Today, we see we have still a lot of potential in 14 markets where we are, and we are continuously focusing on further developing them and step-by-step closing more and more of the white spots and chasing more and more of the opportunities that we have in those markets.

What we also focus on is that we really leverage our multichannel approach. We have very strong expertise in account management. We have very strong expertise also in a very fast and reliable operating direct business with a very strong inside sales capabilities. We have our bechtle.com platform where we can build basket models for our customers around the world.

We have our Bechtle Cloud platform. All of these elements, we immediately leverage in a multichannel approach for every acquisition as well as our own companies. And doesn't 100% fit into the multichannel approach, but every acquisition is also immediately leveraging, of course, the whole corporate strength of Bechtle, be it financial stability, but also terms and conditions with big suppliers and so on where we always can add a lot of value.

The last point, the international customer support. We have a very well-established network across our 14 markets, but not only that. Over the years, we have built big expertise, how we serve customers globally. We have a lot of customers who are relying on us around the globe. And last year, we have pulled the different elements of portfolio we have around Bechtle there, how we do that.

We pull that together in one unit called BID, Bechtle International division, where we can support customers delivering rollouts globally. We can export, we can create multi-local engagements. We can really fit to purpose of what the customer wants around his global IT rollouts as well as infrastructure. That is a huge asset and every acquisition we're doing is adding to that asset and capabilities, helping us secure these customers and winning a lot of really nice new logos there as well.

So the benefits for our customers are, we are supporting them much better with an international account management. We have people available where they are. And we can support them locally because despite a lot of centralizations and so on, customers love it if you have local contacts. This is a huge asset for us. With our logistics networks and our infrastructure we have, be it from our warehouses from London, Hamburg, Neckarsulm, our headquarter down to Paris, down to Spain, we can support our customers very well with cross-border deliveries, with rollouts and managing that whole ecosystem for them. and typically also being able to make equipment available very fast and very reliable.

As I mentioned before, our multinational customers put a lot of big bet on us there because besides our 14 markets, we are truly able to deliver globally and we see this in more and more big wins for us where we are really leveraging our network to support customers around the globe. And we are delivering a consistent service quality. This is a very important element today because with our own hubs, combined with hubs of strong partnerships we have built over time around the globe, we are able to really support our customers on a very broad scale and be a very reliable partner.

And also that is a key element of that internationalization. And every acquisition we do is fitting perfectly into that network. I would now love to hand over to James Napp, who is running our U.K. and Ireland business, and he will give you a perfect example of how we have been doing that over the last years. Thank you, James.

Konstantin. It's right here to [indiscernible] quite a model. Thank you very much. Really appreciate the chance to talk to you today about the development of the U.K. business. I grew up in Germany, and I've been with Bechtle for 29 years. So I have a real green heart. So you're in good hands. It's okay. The development of the business has been -- I'll take you through the time line, but it's been a really exciting journey over those years. And the map hasn't always looked like this. In fact, until 2019, it was just the dot.

So I started -- we started back in 1997. It was a very transactional business back then. It was a product business, catalog business. And we grew the business, I would say, very modestly, very steadily over those initial years in a transactional way. And when we got to 2015, the market was moving, the competitors were moving fast. And we, together with the Board, decided that we needed to start building more of a solutions and services business.

And so we started investing into that. Of course, from a market perspective, everybody also continues to want to see the EBT. So we had to do it carefully and make sure that we were doing that in a profitable way. So from 2015 to 2019, we doubled the business. That investment continued, and we started to build out those technology pillars and build out the additional value that we could offer to the customers. And then in 2019, we opened our first regional office in Manchester, and that's been such a success that we are no longer in that first building.

We're now also in the second bigger, larger building as a part of that expansion. And the reason we did that with the regional development was so that we could access the talent locally and have a greater proximity to those customers. So there's 3 universities in Manchester, for example. So it was a perfect way, and it also gave us that northern base. As we moved on, we start -- we continue to grow the business strongly.

So the business continued to grow. And we decided at that point in consultation with the Board and constantly and hugely supportive that we needed to own more of the delivery in the local sense. So we have a lot of capability centrally, which we're leveraging, but we needed some capability locally around managed services, and we needed to own more of the service delivery and expand the mix into that area.

So we acquired a company called ACS, which was in the Midlands. So again, it gave us another geographical spread. And ACS have a managed service business, which we've since developed, used that as a platform business to develop and enhance that managed service capability, which we now can push out across all of our locations in the U.K.

Interestingly, as part of that acquisition, we also acquired within that an interiors business. And the interiors business, I remember talking to Dr. Olemotz, and I walked up to me and said, "James, I hear you've bought a furniture business." And I said, it's not a furniture business. It's a technology-led interiors business. So we can now -- and it makes actually a lot of sense because we can now go into the market and we can do full fit-out. So company is trying to get employees back to the offices. Those offices have to be nice. You can't do a meeting room without the technology. You can't do any office now without a fully technology-enabled office.

So actually, it's been a real good Trojan horse into some of those businesses to get you early in the door. You also then -- we picked up GBP 1 million deal, GBP 800,000 was fit out, but we also picked up GBP 200,000 of networking off the back of it. So it's a really interesting kind of side note to that acquisition. And we'll continue to develop that business, which will drive technology through with it. So really, really quite interesting.

Very quickly on the heels of the end of '22, so the start of '23, the opportunity came about to buy a volume business, what I would call a volume business tangible benefit. Great opportunity to get into London. It was about a GBP 70 million business, and that business was primarily transactional, primarily client, but they had some -- and they have some very big customers, very big logos. So we took that business, and it's been an incredible journey to then overlay all of that technical value and the different technology pillars into those customers. So that business has pretty much doubled since we bought it and integrated it. As you see in '23, we integrated ACS as well.

So as we go, we buy, we understand and then we integrate those businesses. So if you're going back to what Christian was talking around the productivity and the systems, it's really important for us to do that integration piece, take out unnecessary costs, but also almost more importantly, to drive positive synergies. So we're looking where can we get into those customers, how can we sell more into those existing customers.

Also on the integration piece, and we integrated in -- we integrate -- sorry, one with the integration piece, really, really important. Anyone can do acquisitions, but how successfully you can integrate those acquisitions is another thing. So you can quickly lose value, you can quickly destroy value, and I'm sure that you've all seen that happen over the years with companies who can -- who do a lot of acquisitions, but then the value of that acquisition gets diminished very quickly.

So we take a lot of effort and time in bringing the cultures together and socializing the teams because that will help drive synergies. It will help drive cross collaboration using the technologies from one acquisition into the customers of another. So in '24, we bought a specialist business. So back to the point around we're either buying volume or we're buying specialization and capability. We bought a networking business called Qolcom. And again, that business now will be fully integrated this year in about 2 weeks actually. And so it's been a busy period, but really, really exciting.

And you can see over the -- if you look at the graph there, the way that over those last 3 or 4 years, we've really realized those synergies. So just to break it down, again, back on that trend of M&A as an accelerator and enabler. We did GBP 138 million worth of acquisitions and then the organic and the synergies growth, about GBP 100 million over the last 3 or 4 years, which is a CAGR just on the organic and synergy side of about 11%. So really strong and then the M&A on top of that. Not only that, but the EBT growth has also been strong. So we've grown our EBT percentage over that time as well.

So what are we seeing in terms of an opportunity to 2030? Big ambitions. You saw it on the numbers from Christian earlier. We have a market which is in the U.K., still very, very fragmented. So there's been a lot of consolidation in that market over the years, and we have a desire to continue that consolidation, looking for the right opportunities. And I think it's also important to know, you see it within other IT companies in the U.K., the big ones are getting bigger and it's getting tougher for the smaller ones.

So the scale really matters, especially with the vendors, as Konstantin was mentioned earlier. So now having built this technology base, we have a great technology stack. We have all of the solutions, all of the services, all of the consulting piece, which we can offer our customers. We see a huge opportunity to own more of that customer life cycle within each customer. And customers want you to be there by their side. They want you to be a trusted partner, and that's very much what we're about and very much where we put our emphasis.

So we want to sell across multiple technology pillars into each customer and increase the recurring value as well. So just in terms of market opportunity, I think it's clear to see on the left-hand side there, there's a huge opportunity for growth for our business. The tailwinds that you see across the top, I think Christian already touched on those earlier.

AI is a huge, huge opportunity. I know Lars asked me earlier, is cyber a risk or is it an opportunity? Absolutely an opportunity, huge, huge opportunity for us to drive additional business and then that increase in managed services and owning more of that customer. We have to get close to the customer, and we can be really unique in that, especially given our platform across the 14 countries.

So in terms of the opportunity, that mix, shift towards higher value, more profitable services and solutions for customers and also to help us gain share. So we expect to continue to grow significantly above the market rate. Hopefully, I would say, above even the group average. And with acquisitions on top, we really believe that we can take the opportunity which lies before us.

So to summarize, the opportunity for us to get deeper into our existing accounts is huge. And now that we've built this platform, we also see a big opportunity for us to get into larger customers and develop the business that way as well. So expand within existing and acquire new. In terms of scale, again, I think we've built the platform. We have a lot of capability now in the U.K. We're putting some great standardized packages in front of customers.

We are also using AI very strongly internally. So that's an area where we feel we can help with these productivity gains, which Chris was talking about earlier. And then as I say before, building those recurring revenues to make sure that we have more repeatable business.

And then finally, to accelerate across our business. So we will be looking for volume acquisitions. We'll also be looking where they come up for additional capability, additional skill sets, which we can bring into the company, driven by those tailwinds and making sure that when we do integrate companies that we're preserving the value which we bought is absolutely crucial.

I can't tell you how important we feel that is because I think one of our parts of our unique proposition within the U.K. is that we're not just a bunch of acquisitions coming together, we're going to market as one business. And then leveraging the skill sets across U.K. and Europe. So to stay on trend, organic growth first, M&A as an accelerator and a capability enabler. Back to Konstantin to close out.

So yes, let me close out. So as you've seen in our vision and our mission, this is a key element of our drive going forward. We will continue to sustainably internationalize our business and further grow. We believe it's a very proven approach. We have shown over the last years, whoever was there a few years ago when I was here, we showed you in an earlier stage how we approach the markets, how we do the analytics, how we find targets and so on.

We are now proving really that we are on a very good track. We find the right targets. We are able to integrate them well to leverage them across our companies in the market. So it's a very proven approach. We will continue. We will twist and tweak wherever, but you will see us to not leave that track, but stay right on it. So I can say to be continued at that point. And I would like to hand over to irk Müller-Niessner now, who will give you insights about what we are doing around AI. Thank you.

Yes. Good morning. Now to something completely different. Sorry for that. So my name is Dirk Müller-Niessner. I'm CTO for Bechtle in the fourth year now. And I brought some insights or some views that we have just to let you know, so we will start with a small market view. We will have a technology view, then we will have -- or take the customer view. And at the end, I will let you have some insights in the best view.

If you look on the market, maybe from first -- excuse this, but first from the technology side, we see that we came in the past 4 years from chatting parts now to useful AI options. And we see that it changed now from pilots and from all the use case discussions we had in the past years now to a real agentic adoption, agentic lens in the enterprises and in the SMB market.

On the other hand, we see some shifts. The market started strongly license-based where you could buy a copilot license, for example, per user. Now we see there is a strong shift to tokenized and consumption-based models. And on the other hand, we see -- so first, it was how to access a model, how to get, for example, ChatGPT directly. But now we are seeing more advanced models and multi-model agents and agents and autonomous agents and agent networks that has really improved in a very, very strong way over the past years.

And the last point is maybe just taking the word about security, okay, yes, there was a lot of enthusiasm. Now it's accountability. And maybe there are some fear, but we believe that accountability is the driver. It's not the fear. Even if we hear all those stories today about technology and how worse it is and how the world will end, this is not our view at the moment.

On the other hand, and quite sure that you know that. So if you're looking at the market spend on generative AI in Europe, then we see or we expect a CAGR of 34% in the next years. So there's still a lot of opportunity. But if you see where we're coming from in 2022 and where we have been in 2025, there has already been a big growth for that. Yes.

Stepping back to what I already said is we have always this motion in IT, they say you have to crawl and we will walk, run and then we will fly. And that's -- if we reflect this on AI, then we see that we start crawling by using models even if machine learning was decades before that, honestly. Then we move to data and platforms. We really get an idea to attach to the models, the data that each and every business has. And then we attached workflows.

And I think now we are there that you have already not only AI assisting, I will come to that point later, but you have also agents that work for you and then you will have at the end, agent networks that work together. We see this already in -- mostly in the development area where the developers have multi-agents that work for them. And then we will have at the end or that's our belief, we'll have autonomous enterprises that even goes beyond the things we see today in the LLM project.

On the other hand, so what is the role of the bar? I try to make have the same colors there. So we started various advice, bringing all those use cases into life and explaining first how can you use that or what you can do with LLMs. And then we started to architect and secure the needed data that -- so the data is the part -- one part of the fuel for AI, the other is energy.

And in the next phase, you need support to organize all your data. You need to access LLMs, you need to have an environment where you can run them on-premises, for example. And then we will come to the point where we have to support our customers more in the processing. I have detailed this a little bit more. So as I said, we started with -- or we are still doing advice for some customers.

Not every customer is now already there using AI and it might be necessary. We built those cloud environments that we did that already in the past. This is where we have a strong play, as I said, on one hand, in the cloud on the other hand, on, on-premises, we can then connect all the data pools that are there or we bring those data together.

Very important thing, it's not only about that AI will break out some harnesses and so on, but you need to ensure that the data that you process has only -- only the people that need to know and have access to that data have really access to that data. So it's all about securing data, all about securing that the right identity is accessing this, and we have to secure this for our customers and not only for cyber risks, but also for sovereignty reasons and compliance.

The next -- the transform thing, maybe to go a little bit deeper into that. And we heard it already from Chris regarding how can we drive efficiency. A big point is to review, to first get to know your processes and then do a review how can you access or how can you elaborate your process. And maybe then for the next thing, think about the new process. It's not only -- so first thing is get to know the process, then you will check which step of the process you can optimize and then maybe you will have a chance to transform the complete process with the use of AI. And for sure, you have to operate all those environments.

If it's not only in the cloud, but also on-premises, you have to run all those hardware stuff. We have to maintain all the databases, all the fabrics that you need to provide the data and access that. So why do we think that this is? Why do we think that we have a right to win in that era?

Let's start with the customer. So we already know the customers very, very well. So we have implemented the infrastructure. We have implemented their client environments. We have implemented their networking. We have helped them with their identities. We secure them every day. That's where we think, okay, we know customers best. And on the other hand, if you look on the right side, where we have the technology ecosystem, we are vendor agnostic.

We are in touch with every big vendors if you're looking from the hardware perspective, even through software and supporting all those infrastructures. We are a strong security provider. And I think Christian mentioned it already, we have roughly 900 people doing security business. We need that know-how to help our customers in this area.

And on the other hand, you see this logo, the IPAI logo, I'm not sure if you are aware of. This is the innovation part of artificial AI. It's a strong movement in Heilbronn. We were very right at the beginning part of the IPAI. We have offices there. We have people there that develop our AI technologies for ourselves. And there, we are in direct connect with our customers, too. So we meet all the SMB and enterprises in Germany and Europe at the IPAI in Heilbronn and exchange their current position in the AI play.

On the other hand, we help them to get ideas on how to solve those things that they have. And there are several big logos already direct in contact with us and even public is already there. Maybe to have a few -- I will go deep in that too, but maybe have a few on what are we doing on our own. And as said, we have to drive efficiency too.

And if we start again from the left side, so we try to assist first, so AI assisting that's what we first did give the colleagues a better insight in their daily doing. It's not maybe, for example, if you look for e-mail or if you're looking for meeting notes and all this stuff, that's the first part that we try to optimize and we had a bigger AI adoption plan. I think it was 2.5 years ago, where we rolled out already 6,000 Copilot license then there was some press release around that.

And we really pushed the AI adoption to the whole Bechtle team all over Europe, not only in Germany, all over Europe, we had in France and Spain, wherever. And so we really try to have the -- on the one hand, we help with AI assist colleagues with their day-to-day work. On the other hand, we are really driving AI adoption that the colleagues get an idea, okay, what can we do more than only assist. And that's sometimes very hard for someone sitting there doing the day-to-day work to get an idea what could be the optimization beyond day-to-day work, and that's how we try to drive that.

We have several motions there where we have AI acceleration where we really try to give them kind of, I will not say, freedom, but space where they are able to reflect with colleagues and peers, how can we improve there. And then we take those ideas out of the field, so to say, because they are always knowing processes better than maybe we are from a higher level. And then we develop those AI features and functions, and then we roll it out to all the colleagues. So -- there are some mentioned here from operating level and what we are really doing.

So one thing is I mentioned the Copilot rollout. The next thing is the BechtleGPT. That's our own version because not everyone has a Copilot license. That's why we said, okay, we need to develop our own LLM stuff where colleagues can access AI features. We have -- I will show on the next slide, TenderX and next best actions. And as I said, AI-assisted development, I mentioned that earlier, is where we have our senior developers that develop our own platforms. We have them already attached to, for example, Anthropic and other models to elaborate and use agentic networks to provide new software parts or even develop faster than in the past. And we see there quite good motions.

Some details. So the first thing is TenderX. As I'm sure you're aware of, we have a big public business, and there are a lot of tenders and these tenders are quite complex. And we are developing or we have developed an AI solution internally for us to work on those tenders in a faster way so that we can get an impression, okay, what's the -- so the reason for the tender is that simple. You don't need AI for that. But maybe how -- if you vote how is your success rate and what do you need on capabilities and what are the other constraints that you have in the TenderX, that's why we have built this so-called TenderX.

We used our own technology. We bought several years ago, Planet AI for that, and they are highly developing that together with the public division. I think the public division was last year here for 2 years before in the Capital Market Day and provided how they fuses on public. And again, this is one of the examples where we say this is -- that comes out of Bechtle, out of the real operations, there's a need to improve. And we took that need and we developed the TenderX environment.

This one is fairly enough on our own hardware, it's on-premises stuff because there's a lot of IP in it. And that shows that it's not only about all doing or to work only with the hyperscalers. We do IT and AI really on-premises at the moment and try to bring those special features on site on-premises. The next thing is next best action that's for our selling colleagues.

So what we are doing there is we analyze our own data. And I mentioned that data is very much needed. We analyze our customer data there and get an idea, okay, what are the signals out of the existing data to drive customer business. So easy example is there's a hardware we sold 3 years ago or 5 years ago, then we run the next best action motion and the AI come back and say, okay, these are the customers that have -- that need extended warranty or they need a hardware exchange and so on. Yes, you can do that maybe in other ways, but it's quite faster than the next best action, and we bring all those insights that we gain out of our own data than in our CRM platform.

So we are taking our own data, mix it up, analyze it and then push it to our CRM systems to bring -- to give the sales guys those information on their fingertips. And -- last on this slide, but there are more, is supply chain optimization. We started that 2 years ago. So we really try to get all these workshops optimized -- the warehouse, sorry. We have -- as we mentioned before, there are spread warehouses in Europe, and we are then able to check and to determine, okay, what could be the best place for goods and then we can redistribute them or bring them right there.

Maybe it's better to have, I don't know, ARTICONA equipment in Hamburg than in Paris, for example, and that's part of those things that we do the supply chain optimization. So maybe knowing what's the need, we have to place it and allocate those resources right in front, right before that.

Leaving our own, maybe a few on what will be ahead, and there's a lot of discussion, and I have not focused now on the security discussions we have around AI, but more on the things. So today, we have -- we built this transformation business that will take us for a while. I'm sure this will not stop. It is here to -- or it has landed and it will not go away. It's the next big IT era, fairly enough to say. And for the next 2 to 5 years, we see there's a strong discussion and movement at the moment for sovereign AI and sovereign cloud.

We see that not only in Europe. This is a worldwide thing. But in Europe, we see there's a strong ask for that, not only from public, from our SMB and enterprise customers, too. So this will drive us for the next 2 to 5 years because regulation is not ready. And you know as Europeans, we always start with regulation. But it will come, and it will be faster. We are quite sure. Maybe you read the CA documents from the EU already. They are in a pre phase, but that shows a little bit of the direction and how the public looks on AI and sovereign infrastructure.

The next thing that we see is physical AI readiness. So robotic will come. And I'm quite sure that we will have some stakes in there, even if I don't know now today what it will be. But on the other hand, physical AI will need network. They will need to be connected somehow. They will need to get access to other data. So that will be an area where we really have a closer look. And for sure, I phrased it here like quantum cryptography. Yes, there are already some effects we see on quantum that will extend, and there's a speed up too. Maybe it's more in the security way at the moment, how we can secure data in future.

But on the other hand, for the next 5 to 10 years, all those quantum solutions for complex tasks will be for sure on our radar. We have already sold one quantum computer to the University of Heilbronn some weeks ago. But that was -- that's a very little start, but we will have that on our radar for the future, even if this is not our home stake at the moment. On the other hand, coming back to the other things that will happen is on the one thing, the artificial general intelligence, AGI, that's for the techies already discussed deeply.

We don't know when we will reach it, but we think that this will have an impact of our business. On the one hand, as we deliver infrastructure, maybe we can help our customers there again with data and access. And the third topic here is the entire autonomous enterprise. So if we combine that what we have today with AI, and if we look for physical AI in the future, then maybe it is really possible that the enterprises will really run autonomous. And we will help them to run those things. It will take us a while, but pretty sure they will need IT, and that's why I think and believe that they need.

Ladies and gentlemen, a very warm welcome to the Bechtle AG's conference call. The session is being recorded. [Operator Instructions]

Now I'd like to turn the conference over to Dr. Thomas Olemotz.

Yes, thank you very much, and welcome to our press and analyst conference for the Bechtle AG second quarter and first half of 2026. I'm very delighted by your interest shown in our conference call. Certainly, you've all seen our ad hoc announcement of July 28, in which we already announced the key figures for our operational performance in the second quarter and, in particular, an increase in our guidance. Today, we would like to take a closer look and analyze this very positive development in greater depth. Because I would like to say something upfront, the framework conditions have not improved. They remain challenging. Despite these challenging conditions, Bechtle has performed very positively. We have a traditional proximity to our customers and a close partnership with all relevant technology vendors, and this is paying off.

Our business model is broadly diversified geographically and also across customer groups in our portfolio, and this contributes to our success that we would like to talk about today. Let us have a look at our agenda. We have 3 main sections. We're going to start with an intense more detailed look at our business performance and development and the key figures of the second quarter of the current fiscal year and also the first half of this year. And this will be presented to you by my colleague, Christian Jehle.

The second part is going to cover the latest news and current updates on important strategic events and topics, so to speak, that go beyond the actual figures, but that are highly relevant for our future business development. Then, of course, we will have an outlook on the second half of this fiscal year and also put the guidance raise into context and the aims that we pursue and how we actually look at the next 6 months to come. But now let's turn to business performance. Mr. Jehle, the floor is yours.

Thank you, Dr. Olemotz. Well, Q2 saw double-digit year-on-year growth in almost all relevant key performance indicators. This shows that Bechtle continues to manage the storage crisis very successfully. The customers still have a very high demand for consultancy and support discussions and the encouraging performance is broadly supported across all customer segments and also across all regions. And we've also been successful in terms of cost management. And as a result, gross margin and EBT margin remained stable.

Let's first take a look at the trend in our order intake and order backlog. Order intake increased by 26%. This means that the demand remains to be high, and we've been able to further expand our order backlog. So Bechtle is not living off its reserves but has benefited significantly from high demand. A high order backlog gives us greater certainty also looking ahead to the current quarter.

The reasons for the high order backlog are twofold. Well, on the one hand, we have longer delivery times for certain hardware products, in particular, servers and storage. And the project start-up sometimes takes longer due to the need for discussions regarding increased prices or the allocation of the available IT budget.

Let's now look at our top line performance. Business volume rose by 18%. Organic growth was also very strong at 13%. And part of the growth was driven by higher hardware prices, and sales also performed well, driven by a higher proportion of hardware. Nevertheless, Software has also recorded consistently high growth and organic sales increased by 10%. So overall, a very strong performance from Bechtle at top line.

Let's now look at the performance over the course of the year. If you look at the 2 quarters, we can see that momentum picked up in the second quarter, but price effects are also playing a role here. June, in particular, was very strong. Discussions with customers to initiate projects are currently rather long drawn out compared to the past, though some were successfully concluded in June. For the first half of the year, business volume stands at 15 -- has an increase of 15.6%, which is well above the previous forecast and one of the reasons for the upward revision of our forecast. So as we've communicated in March of the first quarter and after the second quarter, we have positive proof points for our positive business development.

Let's now look at the development in the segment. I think the most important thing you can see here that all segments, all segments inclusively contributed to growth with double-digit figures. So we have a very sound and broad basis. It's not driven by individual segments. France continues to perform well, albeit at a lower level. And Other Europe, we see a key growth driver at 51%. This includes growth from M&A in Spain, Italy and Portugal. But we also see a strong organic growth at 22%. And the good news here is, as I've said before, growth is broadly supported by all customer segments and all regions, which is a clear indication of a sustainable trend. And I'm sure you followed the press releases and if you look at the growth of our competitors, the smaller and the bigger ones and if you focus on Germany, well, we can safely say that we have gained market share, above all, in the first quarter.

This brings us to the earnings performance. If you look at earnings, we can see that gross margin remains at a high level. So we are still able to manage the current difficult situation effectively. And Dr. Olemotz has mentioned the difficult situation. Cost of materials show a slightly disproportionate increase, but gross margin remains at a high level. And this, of course, reflects our successful cost management. Let's look at the trend in operating profit. EBT is also seeing double-digit growth in the second quarter by 20%, which means that the first half year increase is 16%, which is well above our previous expectations, further reasons for the forecast upgrade.

The stable gross margin is the basis, but cost management measures are also having a positive impact. So in a nutshell, the positive message here is the EBT margin remains stable. Now let's look at the different segments. Here too, growth is broad-based with all segments showing strong growth. So particularly strong in the segment Other Europe. This is not only driven by acquisitions, but also a very good result in existing units and great synergies between existing and new units and the cooperation with the headquarters is also great. A case in point is the Iberian Peninsula and was also encouraging. Germany is largely maintaining high profit margins.

And so, to conclude our review of the key figures, let's take a look at operating cash flow. Operating cash flow was under pressure in Q2. The reasons are obvious. Operating cash flow reflects our strong operational performance. And as I've said before, June, in particular, was very strong. Hence, significant effects relating to the reporting date. On the one hand, order-related inventories rose and on the other hand, contract assets also increased. That's related to the reporting dates, and I'm sure you all understand this. So here, we see the development of the business in the second quarter, in particular.

Structurally speaking, the picture is positive. If you look at our DSO performance, this has improved from 39 to 37 days. And also working capital sees an improvement. Despite an absolute increase, the relation to business volume has improved from 7.3% to 6.8%. So all in all, we are fully confident of and assume a positive trend in OCF for the financial year 2026.

So let's look at our employees now. Headcount growth is exclusively driven by acquisitions. In organic terms, we see a decline by 1.4%. And over the year, we see a drop from Q1 to Q2. So we continue to make a conscious decision to adopt a measured approach to new recruitment as part of our cost management strategy. So we see positive development and are very conscious here.

Let us now turn, as discussed, to look at our nonfinancial special events. I shall hand back to Dr. Thomas Olemotz.

Thank you, Christian. The following selected current updates show examples, just examples that contribute to our sustainable and profitable growth. We will have a look at a successful acquisition, 3 important milestones in our AI activities. A sales success in our public sector business, a very successful capital markets transaction, and last but not least, another step in implementing our sustainability strategy. Let us start with M&A. With the acquisition of Interforce that we've already announced, we are once again expanding our market presence in the Netherlands. Interforce is one of the established managed service provider for medium-sized companies in the Netherlands and employs 38 people. Interforce's business model is based on a high degree of automation, and this explains the relatively low number of employees, and it focuses on integrated cloud and managed service solutions for small and medium-sized customers.

With this acquisition, we strengthen our own managed service offering portfolio, further increase our share of recurring revenue and we gain an experienced team with strong technological expertise. Our plan is to bring Interforce's standardized solution also to other European country markets in the future. Let us now focus on 3 particular success stories in our AI business.

First, we are expanding our cooperation with NVIDIA. And this strengthens our position as a provider of AI infrastructure. We're achieving the highest partner level with NVIDIA. And this confirms Bechtle's comprehensive expertise in designing, deploying and scaling high-performance AI solutions. Second, together with Dell and yes, NVIDIA, again, we're also opening a central Dell AI factory which will include the demonstration and proof of concept environment as well as a competence center for consulting and workshops. The aim is to help customers with validated reference architectures to bring AI into productive use more quickly.

A remarkable success has also been achieved by our subsidiary, Planet AI. This is our AI research and development company, and it has won the world's most demanding competition for document-based AI systems. Planet AI came in first, both in the overall ranking, but also in 7 out of 8 competition categories, quite impressive.

Let us now have a look at our public sector business, ladies and gentlemen. In the second half of the year, this will be especially critical for our business performance. Bechtle has been awarded the contract by the Bavarian State Ministry of Justice for the operation and further development of central IT services. The framework agreement centers on the operation of the central biotech IT platform. This is essential for digital workplaces and IT services for the Bavarian Justice systems. Managed Services, project and consulting services and provision of IT hardware are included in this framework agreement.

The contract commences on January 1, 2027 and has an initial term of 6 years. The maximum contract volume amounts up to EUR 250 million. This project also includes the support of 2 data centers and 220 locations in Bavaria with a total of more than 17,500 IT workplaces. This is a long-term contract. And through this, Bechtle will support the courts and public prosecutor's offices in Bavaria to further advance digitalization and providing employees with a secure modern and high-performance IT working environment. But also on the capital market, as already announced, we've been quite successful.

In May and June this year, we successfully placed our second promissory note transaction since 2018. The demand was very high. So the originally target volume of EUR 250 million was increased to EUR 450 million. The order book was oversubscribed several times and was closed early for new orders. In the final, the binding phase, the order book was approximately 3.5x the original target volume. A total of 84 domestic and international investors participated in the transaction. The promissory note bonds have maturities of 3, 5 and 7 years in 6 clusters. This is how they were issued. And with this transaction, we're optimizing the maturity profile of our financing structure, and we're strengthening the company's long-term financing, particularly with regard to our M&A strategy. Last but not least, let us have a look at some progress with regard to our sustainability strategy.

Bechtle AG has joined the Responsible Business Alliance as an affiliate member. This supports the vision and objectives of one of the world's largest industry initiatives for promoting social, environmental and ethical standards in global supply chains with a focus on electronics and IT industry. By joining this alliance, we commit to progressively implementing the code of conduct of Responsible Business Alliance in our own business processes and also involving our direct suppliers in compliance with these requirements. Joining this alliance reinforces Bechtle's Sustainability Strategy 2030 and the corresponding ESG objectives.

Ladies and gentlemen, let us now turn to the outlook for the remaining months of this year. As I already said, the second quarter was very positive and significantly exceeded our own expectations. It is quite remarkable how well we've been able to navigate these difficult challenging framework conditions in the IT market. And let me emphasize again, these conditions are and remain challenging. They have not changed. I would also like to remind you that the GDP growth forecast for the European Union in Germany have been revised downward as well as the growth expectations for the IT markets in Germany and France.

However, the first half of this year was extremely successful. We have a record order backlog ahead of us. So we look confidently towards the second half of this year. So what does that mean specifically for our outlook? We are raising our guidance from March 2026, our forecast. The demand for future-proof IT solutions and the corresponding consulting services remains high, and our proximity to customers is a major asset here. And the public sector, we expect a seasonal pattern and further positive momentum in the second half of the year. We know that in the second half of the year and particularly in the fourth quarter, we are facing very high comparative figures. Nevertheless, we are convinced that we can maintain our successful course.

For the overall fiscal year, we expect a business volume growth of more than 10% in revenue and EBT growth in the range of 5% to 10%. The EBT margin is expected to decline slightly, mainly due to investments in our own IT infrastructure. Ladies and gentlemen, this concludes the review of our performance in the second quarter and first half of 2026, and our outlook for the remainder of the fiscal year 2026. Thank you very much for your attention.

And now I'm happy to take any of your questions.

[Operator Instructions] We start with a question from the German room. The first question comes from Andreas Wolf, Berenberg.

Yes. Great. Congrats to this strong quarter. Three questions. The first, organic growth in the second quarter was double digits, very strong. But the organic development of employee development was flat. What are the cost expectations here? So the ratio of hardware prices to your revenue development. Can you comment on that? And the third question refers to the public sector. You see new tenders due to the increase in hardware prices?

Thank you, Mr. Wolf for the questions. Let me start and then my colleagues will add details. As regards to organic growth, indeed, the second quarter was extremely strong, and you've seen it, we had a close tab on the cost. That is why we don't expect significant cost increases for the remainder of the year. If we show an increase in employee costs, that's due to the variable part of the remuneration and the provisions necessary for that. If we continue the same performance throughout the remainder of the year, then, of course, our sales colleagues will want to have a share in that. And we have the provision on a monthly basis, and that might mean that for the back end of the year, employee costs will increase. We don't assume, however, that we'll see an organic increase in headcount for the remainder of the year.

If the number of FTEs increase, then that's only due to acquisitions like in the first half of the year. And the second was, of course, if we deconstruct growth, there are 2 essential effects, volume growth and price growth. Well, more than 50% of our growth is driven by price effects. However, you can't distribute it equally across all product groups. There are certain product groups where we grow both in terms of volume and price. And there are other product groups above all where the shortage is biggest where we see tremendous price increases and we expect further in the back end of the year. And what's really strange about the situation, we have other product groups where prices drop.

So we have a rather complex situation, if you look at the price development at product level, something we haven't had like before. Usually, these effects are in line during these phases. And the reason why this is different this time is simply due to the supply chain restrictions, which is different across the different product groups. But the price effect is an essential driver here.

As regards to the development of the public business, we generally report about tender we won once they exceed a certain level. I've already mentioned it in my explanations for us. The development in the public sector business sees a usual seasonality. And I mean, you've been following us for years or even decades, so you are aware of the seasonality in the public sector. And that's decisive for the performance of the second half year. We expect this to continue. The public sector business in Germany and abroad has developed solidly. We didn't expect more for the first half year. And for the second half year, we expect growth rates to increase, above all, in the fourth quarter. And we need this because you know that year-on-year, we have a very strong effect, above all, in December because -- but from today's point of view, there are no reasons to doubt that the momentum will continue towards the end of the year. And the tender volumes don't drop significantly.

So our public sector customers don't respond to the price increases by tendering less volumes. We don't see this. Of course, the structure changes slightly and the customers need to be flexible in terms of manufacturers, some produce more, others less, but that's just the usual fluctuations we see here. So we don't see any special effects for the second half of the year, and that is why we are rather bullish in the assessment of the development.

Next question, Florian Treisch, Kepler Cheuvreux.

One question regarding the nonpublic sector. I mean, you've clearly indicated that Germany and the public sector are successful here. But if we look at the H1 figures, the nonpublic sector dropped year-on-year in terms of revenue. Was Q2 better than Q1? And do you expect a recovery in H2? And the second question refers to pricing. If you look at the guidance, 5% to 10% revenue, and you said more than 50% and is driven by pricing. And you also said that the pricing continued to increase. Is that ambitious to look at the lower end of the new guidance? Or is 10% or even more to expect it because we see this tailwind by the prices.

Dear Mr. Treisch, that's how I'd like to start my answer. I would have been surprised if you had not asked this question because we know each other quite well. I mean we know each other really well. Is our guidance too conservative? Yes or no? Please think back 3 months and think back and recall the discussions we had back then. We've said right from the start, and with hindsight, we see the development as a confirmation to be rather conservative due to the high level of uncertainty. And that is why we've been revising our guidance in shorter distances. So we do this on a monthly basis, not quarter-by-quarter. That is due to the fact that the order backlog is at a historic high. However, there are certain reference values that are still lacking.

Regarding how order backlog translates into actuals because we still expect disturbances in the supply chains with longer delivery times. And at the end of the day, if you want to invoice a specific project, which consists of several components in terms of hardware. It depends on the deliverability of individual products. So it's no good if in some product groups, there's less pressure. But in terms of storage, the pressure remains unchanged and high because storage is part of any project we have once it exceeds a certain size.

And in terms of guidance, this means that we looked at this very carefully. I mean we've been blamed for being too conservative at the beginning of the year, but with a view of the development, we can explain why this was the case. And the framework conditions haven't changed in the back end of the year. Apart from the fact that the first vendors who commit to certain delivery times, that's not generally the case, but individual vendors do that and for tactical reasons, I'm not giving you any names here. So that is why we are fairly confident that as regards to the top line development, we are quite confident that we achieve our targets.

And the first question, the development of the nonpublic sector. You're absolutely right. Q1 was rather hard, but you have to make a distinction between SMEs and corporate business. In the second quarter, the industrial customers have developed better. But we still see, and I don't want to hide this, we have difficult situation in our own industry, and we have a different demand situation in the classical SME, which still accounts for almost 50% of our business. Right now, we are compensating this quite successfully by our corporate business with individual big customers and with the public sector business. If in the second half year due to the economic development, which shows some slight improvement, so we see a change here, then we will have to especially relevant towards the end of the year.

Next question by Martin Jungfleisch, BNP Paribas.

I do have a question on customers' reactions to the hardware price increase. The order intake and business performance. Is this driven by pull-ins? And will this have effects in -- for the second half of the year? Or do you also expect a strong order intake in the second half of the year as well? And how do the customers change their procurement behavior with regard to critical and noncritical infrastructure? And what do you expect to happen whether the customers even adapt their budgets for 2027 with regard to the higher prices?

The first point, customer response. Well, we see customers that put everything on hold. And the other customers that go through this process step by step and are rather careful. What you say is practically what I intended to say, there is an uncertainty. Yes, we do have quite a high order backlog, historic high. But how this translates into top line growth might not be at an equal level. And this is exactly what you're referring to. So what does that mean? It might be that individual customers might place several orders with different providers. This is what we've seen during COVID. Customers can place orders that are nonbinding and can cancel them depending on their own economic development and the industrial development. So the order backlog might be high, but the delivery times might also be pushed into the future. So this could translate into effect on to the materialization into top line growth.

So this might be quite significant. And this is why we cannot say everything that we have got with a certain deadline can be materialized in this fiscal year. However, we do not expect a decline in order intake. Since the end of the second quarter, we see a positive development for July. We can confirm this already. And the third quarter will most likely see positive values, we started positively, just as we ended the first half of the year. So we do not see any weak signals into this direction or that direction, which might lead to a totally different investment behavior in the second half of the year.

How do the customers respond to higher prices? Well, most of our customers regardless of us having framework agreements with them or project-related agreements. They, of course, do not have endless options to expand their own budget. At the same time, we're not seeing any reductions either because there is a necessity of investment in the platform services and IT infrastructure. This demand remains high. You know the buzzwords, and we've mentioned them time and again in our quarterly reports, we need increased storage capacity and computing capacity due to AI, edge computing. The CPU and storage volume needs to be increased. But on the cost on the user side. So these are structural trends that have not changed. And this is why most of the customers use the existing budget and reallocate their spending according to the prices.

So some vendors might be taken into consideration that were off their chart in the past because now the vendor can actually provide them and with the equipment and didn't raise the prices significantly or maybe some projects are pushed to the back burner. We do not know. However, the investment budget remains the same, but still remains a potential market for us, and this is how we look at the current customer side of the market.

The next question by Martin Comtesse by Jefferies.

I would like to ask several questions. Number one, incremental EBIT in the Other Europe segment, we see EUR 10 million year-over-year. Could you shed some more light on to this, how much comes from acquisitions because this seems to be a highly profitable business that you acquired. And what do you expect for the second half of the year? This is question number one. Question number two, the cash flow figures. Can you give us some more details? Strong June, what is its impact on the cash flow or the belated project implementation, so we can sort of get an impression of -- for the development of the third quarter.

My colleague might add some more details on the cash flow because when we look at it superficially, this is actually the only flaw in our figures of the second quarter. We also announced in the press release, also in the quarter's report. Cash flow actually, doesn't worry us in the long run. And I'm not saying this against the backdrop that the promissory note bonds, which actually puts us in a quite comfortable position. Christian Jehle already said it, we see an improvement in the DSO. So what's the underlying message? We're actively managing or quite aggressively managing our cash flow and the capital. What is this cash flow and capital increase been about? Well, we have the project bound inventory and they increase, but this doesn't mean any risk with regard to depreciations because we have specific projects backing this up. And to do this in these times is only possible for companies that are very well financially set up because we do have a buffer. And we have longer delivery times for individual components and projects, but we can buffer this.

This can lead to the fact that at the deadlines, and yes, it's been the case for a couple of projects that network components and notebooks that were in our inventory for specific customer projects, but the project hadn't started. Maybe the docking station couldn't be procured. And in such a case, in such a scenario, we can put this into our balance sheet, but it doesn't entail a depreciation risk, but it gives us the possibility to show to our customers where the added value is when cooperating with Bechtle because our competitors -- some of our competitors do not have this room for maneuver. We have this room for maneuver because we have a sound balance sheet. This is what I wanted to say upfront when it comes to the underlying mechanisms for cash flow. And Christian Jehle said that we can be quite optimistic that we will see an improvement in the situation by the end of the year because we have special effects, deadline-related special effects that sort of had this negative impact on cash flow.

Yes, I would like to comment on the Other Europe segment question. Let us take top line as a proxy because you said where does the contribution to the result or the earnings come from? Well, we have a 50-50 situation. Organic growth of 50%, but we see an overall positive trend. So the acquisitions in this segment drive our growth and the EBIT contribution is also to the amount of 50%. And you asked about the second half of the year. We are seeing a positive development. The acquisitions that we've made pay off, especially on the Iberian Peninsula, they develop positively. We see a trend in line with our acquisition plan. So we expect positive contributions in the second half of the year to our balance sheet. When you look at the margins, the segments show a little less than what we see in the German market. This is due to 2 factors. One is maturity. And the organization, as you know, has been active on the German market for 40 years. So we have a different interaction of the different market elements. And the acquisition, of course, needs to sort of ramp-up time until we reach the margin level that we are used to. So the positive effect of the first half of the year will be continued in the second half of the year, and we expect a further increase in 2027.

Well, one additional question, if you allow. As a public sector business, could you briefly tell us how much is -- happened at the federal level and how much happens at the state level, the federal state? And put this into relation to the investment program that is about to happen. Do you see any activities or increased activities regarding tenders for '27 that might indicate that there will be a stimulus program?

Yes, we see this. This is reflected in the specific tenders, but also in the fact that we've started with the year with approved budget because the past 2 years, that was not the case. So I see that a strong factor that we have a sound basis between state, federal and also municipal authorities. That's the fourth biggest industry, so to speak, health care, that is. The stronger part is the federal business, but that doesn't mean that the customers are necessarily customers at the federal level. The federal Ministry of Interior often has a consolidated tender covering lots of different regions of the federal authorities orchestrate, so to speak, the tender for several entitled authorities who can then access this tender.

So if you look at the percentage figures, you can't deduce that 20% of our business happens with federal authorities. And that is why we are always careful to make it clear that we're not exaggerating that from the town hall of the smallest city across the federal Army to the Ministry of Interior, we have very different customers. And we are broadly based in this customer group. So there are no singular dependencies here. Obvious. And I've pointed this several times across the past years, we've seen constant increase in the tender, sometimes reaching billions, a tremendous opportunity, if you win it. But also certain risk if it's re-tendered and you don't win the tender. But that's business after all. The interpreter apologizes. They brought [Technical Difficulty] the conditions of the past. Now we see a 30%, 40% and 50% price increases combined with the delivery problems we have and that is something that makes us careful regarding the interpretation of the impressive order backlog we have. And we'd like to leave it at that. We still assume that it will have positive effects in the back end of the year, both top line and bottom line.

Yes, perfectly. And that brings me to my favorite topic. I know you don't quantify your own IT investments. But if I still assume this high digital single million euro amount. I assume that EBT has been affected by EUR 2 million or EUR 3 million?

Yes, that's correct. I've said in the past discussions here, we have S/4HANA and we are making great broadcast here. We had a pilot, the system house in Neckarsulm. That was the pilot. We had [indiscernible] going live. And now we are escalating across different companies and countries. So we are on plan in terms of project progress, and also on budget. So yes, exactly, that's the answer.

Well, OpEx, of course, are impacted but CapEx too in terms of depreciation. 90 to 100 companies, give or take a few, which we have to shift to SAP S/4HANA and a high number of them have been acquired. So this migration will be part of the post-merger integration, and you don't do this over the weekend. So I assume that figure Christian has just mentioned, will be in the books not only next year but in the years to come. We have a rollout plan that will cover several years.

And one final question. Due to the extreme high prices for new devices I hear the refurbishing of old devices is getting more interesting. Do you see the same with your customers? And will that mean that you can have higher margins than just selling new hardware?

We see it with our customers, too, yes. And there are existing public -- certain public tenders where it's part of the tender requirements to offer a certain refurbished part. The problem with refurbished part is over the demand for refurbished products or refurbished infrastructure is that there often not the demand. We could do much more if we get more old devices or used devices. We have a certain certification that is relevant here for data elimination. We have consolidated this in Hamburg and our Dutch colleagues have a great focus there. But the limiting factor is the offer of used products. I mean, customers also think about a longer use of their devices so that they are not forced to accept price increases combined with uncertain delivery times, and that leads to a further reduction of the limited offer.

I don't want to hijack this call, but if you talk about offer as a problem, for the customers don't want this is the demand side? Or this is misunderstanding?

No. Offer means that we need to have returned products. You can only do business if you have old products you can refurbish. And of course, we want to take best leased products. But if the customer says they want to keep the leased products, they extend the period. That's what I'm talking.

Okay. The alternative to refurbishing is to extend the lease period. Okay. So I almost hijacked this call.

You can bear with us. It doesn't cost more.

Well, that's what you say and then all of a sudden, I'm faced with the bill.

Right now, there are no further questions in the German room and no questions in the English room. [Operator Instructions] There are no further questions English or German. And with that, I'd like to hand back to Dr. Thomas Olemotz for the final remarks.

Yes. Thank you. Thank you for the interesting discussions we've had. I enjoyed it, and my colleague is nodding his head, so it was fun. I think we've addressed all relevant aspects that will make it easier for you to assess the current situation. On behalf of Christian Jehle and our IR team, I wish you a beautiful day and a nice week and all the best for the future. We meet at the latest when we report on Q3. Thank you very much, and bye-bye.

Ladies and gentlemen, this conference call ends now. Thank you very much for participating and bye-bye.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Thank you, and welcome to our Bechtle Analyst Conference on the first quarter 2026. I am delighted by your interest. Ladies and gentlemen, today, we are reporting on a strong start to the year for Bechtle AG. We are showing top line and bottom line double-digit growth rates. This is all the more remarkable given that the operating environment remains challenging. Well, with regard to the IT market, I've often said, size matters, and we are seeing this again very clearly now. Bechtle is one of the largest and most important VARs in Europe. Vendors work closely and trustingly with us. And this is paying off, especially in times like these when the IT market is characterized by the so-called memory shortage and the supply chain bottlenecks and clear price increases.

As usual, today's presentation is divided into three main sections. As usual, we start with the essential key financial highlights of the first quarter of the 2026 financial year, which Christian Jehle, our CFO, will present for the first time in the context of the Q1 presentations. Then latest news that is important strategic and developments beyond the figures, and I'm going to present those to you. And also the third part of the presentation, the outlook for 2026, our objectives and the overall economic development, which we expect for the next 3 quarters. But first, let's look at business performance. Mr. Jehle, please.

Thank you, Dr. Olemotz. The first quarter was characterized by difficult geopolitical framework conditions, amongst them, the war in the Middle East and the memory shortage that Dr. Olemotz already mentioned. On the other hand, we also saw high demand from customer groups in all segments. In many talks with our customers and vendors, we were able to find solutions in this respect. A company like Bechtle that stands for customer proximity and cooperation with vendors can benefit from such a situation. And as I said, we started out into the year 2026 excellently.

Let's, first of all, take a look at order intake and the order book. In Q1, order intake went up by 17%, which meant that our order book grew further. This means that Bechtle was able to benefit from the high level of demand. High order intake numbers also give us certainty for the development of Q2, and we see in April already that the development continues. Let's now take a look at the top line. Business volume grew by over 13%. In organic terms, we're at a very good level, 11%, which means that our core business is healthy and intact. And our acquisitions are, of course, an important contribution.

We are managing framework conditions well. Revenue and revenue growth is below the business volume as usual due to IFRS 15 and also the growing software business. Let's now take a look at our segments. All segments made a contribution to our growth, either in the double-digit or high single-digit range. The development in France is remarkable. We're back on a growth path having managed the turnaround. In the rest of Europe, we're growing at 17%, almost 30% when we include our acquisitions. And the good news is that growth is based on a very broad foundation and all customer segments. So this seems to be a sustainable trend.

Let's now take a look at our earnings situation. EBT is growing in double-digit terms. In Q1, we see growth in the top line, a stable profit margin, which makes us feel very confident. Investment into our own IT infrastructure continues, and our measures in cost management are showing the first success. So we still have a very positive message. So our gross margin and our profit margin are healthy in Q1.

Let's now take a look at the segments. Again, the trend is broad-based. All segments make a contribution to our development. We still see a higher share in the classic product business, which you can also see reflected in the margin. In Germany, we have the widest portfolio, established processes, professional management teams and decentralized services. Our specialists also work from a broad basis, and that also is mirrored in profitability. But of course, we're also working towards getting the international segment at the same level of margins.

So to conclude this part, let's take a look at operating cash flow. Operating cash flow in Q1 developed well after a decline the year before. We're now back in the green despite the positive and the important growth we've seen. Inventory has seen a buildup, but it's based on customer demand, and we see that our performance has increased. Also in terms of DSO after the last quarter of 2026 (sic) [ 2025 ], we were at 28 days, and this number used to be 39.

Now let's now take a look at our staff. The staff expansion we saw in Q1 is due to acquisitions only. In organic terms, we see a decline by 1.7%. Here as well, we take very conscious decisions, and we are exercising a moderate approach. By the end of March, 729 young people received training or went through dual study training courses at Bechtle.

Now let's now come to the latest news. Dr. Olemotz, please.

Yes. Thank you, Mr. Jehle. The latest news, which we've compiled here, highlights a lot of the key future areas of IT in which we are strategically well positioned, thereby underpinning once again Bechtle's readiness for the future. We look at the topic of quantum computing, an important project in the health care sector. And of course, digital sovereignty is an essential topic here, but we're also looking at a further success in our business with public sector clients and the presentation of many future-oriented topics at the Hannover Fair.

Let's start with quantum computing. We are currently implementing a highly forward-looking project at Heilbronn University of Applied Science. This involves the integration of a so-called IQM Spark quantum computer with which we are creating a platform for teaching, research and practical development. The system by the Finnish manufacturer IQM Quantum Computers will go live later this year and will be supported and further developed by Bechtle over a 3-year period. installation at the tech campus will provide direct access to superconducting quantum hardware for students, researchers and partners.

The aim is to embed quantum computing in education and application at an early stage and to integrate it with the traditional IT and AI environments. The project is also an impressive example of Europe's technological sovereignty as European hardware operations and expertise are closely integrated and the regional innovation ecosystem that has emerged in Heilbronn in recent years is being further expanded.

The functioning innovation ecosystem is also at the heart of the following project in the health care sector. As consortium leader, Bechtle is playing a key role in the WebMedX project. This project aims to make care for people with cardiac insufficiency more digital, more connected and easier to use in everyday life. Together with Würzburg University Hospital and other technical and academic partners, a cross-sector telemedicine platform is being developed to better connect all parties involved. The aim is to close gaps in care in the post-hospitalization phase, prevent readmissions and to sustainably improve care. The digital network is intended to serve as a model for other regions and other conditions and is thus truly relevant for us beyond this individual project.

Bechtle brings comprehensive industry experience in the field of digital health care to the consortium through a team specializing in health care solutions. As consortium leader, Bechtle is responsible for the overall implementation of a viable technological framework for the platform, thereby supporting the transformation of a medically highly relevant care concept into a practical digital solution. Aspects of digital sovereignty also play a major role here, an area that Bechtle has also been active in from an early stage.

Since March, we have been actively promoting the Bechtle Index of Sovereignty, BIoS in short, offering a specific implementation model for customers who wish to take a structured approach to digital sovereignty. BIoS is a proprietary software solution designed for the systematic assessment of the level of digital sovereignty within companies and public organizations. We combine the systematic assessment of key business processes with comprehensive consultancy from certified IT business architects. This enables customers to determine their individual maturity level of digital sovereignty based on data and to track developments on an ongoing basis.

The assessment analyzes data sovereignty, technological independence and capabilities across key business and administrative processes. Bechtle is initially piloting the BIoS assessment in Germany, Austria and Switzerland. However, marketing in other European countries will follow in due course.

In terms of sales, too, the topic of digital sovereignty has now become highly relevant as the following example clearly illustrates. A recent report published just yesterday by GovTech Deutschland highlights a significant sales success for Bechtle in the public sector. We are very happy to have been awarded the contract for the multi-cloud broker within the GovTech framework. With a strong partner network comprising international hyperscalers and European providers, we are creating a centralized, standardized platform for cloud and AI services. This enables public authorities to have fast, secure and flexible access to modern infrastructures and it provides a concrete contribution to digital sovereignty as well as to the successful implementation of the MEDI:CUS health care platform and the so-called Deutschlandplattform. The framework contract is worth EUR 250 million over a 2-year term with two options to extend for a further year each.

Further, digitalization using platform-based ecosystem is playing an increasingly significant role, not only in public administration and medicine, but of course, above all in industrial value creation. At the Hannover Fair, Bechtle demonstrated thus how companies can approach the digitalization of their industrial value chain in a consistent and end-to-end manner. The guiding principle behind the exhibition stand was the intelligent integration of various dimensions of modern industrial digitalization. To this end, Bechtle brought together the expertise of various specialized units within the group and together with partners, presented practical application examples and innovations.

This year, Bechtle further expanded its presence at the world's largest industrial trade fair. At the Bechtle Group stand, visitors were able to view an integrated portfolio spanning the fields of engineering, OT security and manufacturing, the industrial Internet of Things and business integration.

Ladies and gentlemen, so much on the strategically relevant news in the past months of the financial year. Let us now turn to the outlook. We have started the year with a good first quarter. This is very encouraging and makes us confident as regards to the remainder of the year. As I've mentioned at the start, this is all the more remarkable given that, unfortunately, the economic conditions have not improved significantly. The fact that we are coping well with these difficult conditions is a very positive sign.

Against this backdrop, we are confident regarding the developments in the second quarter above all in view of the tremendous order intake. And according to the first preliminary figures, April is showing as positive a picture as the previous months. On the other hand, uncertainties remain in connection with the geopolitical situation and also regarding the IT-specific situation. Our vendor partners have already announced further price increases. Visibility as regards the second half of the year remains limited. Customers -- being close to customers and vendors are particularly relevant here, and that is the strength of Bechtle.

Well, in concrete terms, this means for our outlook, we confirm our guidance from March 2026. In the first quarter, we demonstrated that we can grow profitably even under difficult conditions, and we expect this to hold true for the full year as well. We will continue to closely monitor the dynamic developments, particularly in the IT market and regularly review whether our guidance still accurately reflects the situation. Nevertheless, I would like to remind you, as does Christian Jehle, that we have planned significant investment in our own IT for this year, which will be reflected in the bottom line, of course.

However, this does not change the fact that we remain convinced of the positive development of the Bechtle Group even at difficult times as these. That, ladies and gentlemen, concludes our review of the first quarter of 2026 and the outlook for the rest of the 2026 financial year. Thank you so much. And we are now ready to take your questions.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Thank you. Welcome to our analyst conference on Bechtle AG's third quarter of 2025. Thank you for your interest. Ladies and gentlemen, as you all know, we have had some very turbulent quarter, quarters in which Bechtle's business volume growth was unusually low quarters in which our earnings were below those of the same period last year.

Although the reasons were understandable, the situation was nevertheless unfamiliar and unsatisfactory for all of us. Today, however, we can look back on a quarter in which the signs are finally pointing in the right direction. Business volume, revenue and earnings are up and have improved year-on-year. Is this the long-awaited lasting turnaround? I don't want to dampen the excitement right at the start. But unfortunately, we won't be able to answer that question definitively today. However, we will take a closer look at where the improvement in the third quarter came from and why we're optimistic about Q4.

As usual, today's presentation is divided into 3 main sections. As usual, we start with a more detailed look at our key economic indicators for the third quarter and the first 9 months of the 2025 financial year, both at group level and at segment level. This will be followed by some important strategic events beyond the figures that are important for the future of the company before we end up with the outlook for 2025 and the end of the year, so the next few weeks, in fact.

But first of all, let's take a look at business development. Ladies and gentlemen, the third quarter saw encouraging developments. You will no doubt have seen the figures in our press release earlier today. However, this does not mean that the all clear can be given across the board. We still see regions and areas where we face major challenges. Unfortunately, the overall economic conditions have not yet improved significantly and in all regions. But with growth in all relevant KPIs, we have taken an important and significant step in the right direction. Our top line has grown, and we have repeatedly emphasized that stronger growth is also an important prerequisite for improving our earnings. In addition, we have also been able to rein in cost growth, resulting in EBT growth in Q3 for the first time in 5 quarters.

Let us now take a look at the aforementioned top line development, that is business volume. At 8.4%, business volume growth is once again in the high single-digit range and thus within our long-term target range. In purely organic terms, growth amounted to 6.2%. This chart clearly shows the positive development over the course of the year. We have grown from quarter-to-quarter. And allow me to make a small side note. For the first time ever, we exceeded the EUR 2 billion mark in business volume in the third quarter. It is this positive trend, in particular, that makes us confident about the fourth quarter.

For the segments and the regions, this means the following: our international performance is particularly impressive, in my view. We achieved growth of no less than 17% here. And in organic terms, the figure is still almost 12%. These figures clearly demonstrate that our international M&A strategy was the right one. It has broadened our footprint and significantly reduced our dependence on economic ups and downs in individual countries, especially the markets in Belgium and the Netherlands, the United Kingdom and Spain have developed very positively. And it is no coincidence that these are precisely the countries in which we have strengthened our position through acquisitions in recent years. We have thus not only strengthened our existing business activities in these countries, but also used a multichannel approach to tap into new customer groups and support our existing customers with a broader service portfolio.

Let's now take a look at revenue. At first glance, the picture is not surprising. Due to the application of IFRS 15, you're familiar with the context, revenue is lower than business volume. However, we can also see that the discrepancy between business volume and revenue is not quite as pronounced as it was in the past. This is not because our software business has become less successful, but rather because our customers increased their investment in the replacement of their client infrastructure in Q3.

In the end, we don't always know with certainty why a customer chooses to invest in their infrastructure. However, one possible driver in the past quarter may well have been the switch from Windows 10 to Windows 11. Our internal analysis of these developments is still ongoing. The revitalization of our trading business is also an important factor when considering the earnings side. That is EBT. Our EBT grew by 2.4% year-on-year in the third quarter. That is certainly no reason to get overly excited just yet. But ladies and gentlemen, after 5 quarters of declining results, it is indeed very positive news that we are back on the growth path with our earnings.

Even more remarkable, however, is the momentum we saw over the course of the quarter. Compared to Q2, we have improved our earnings by over 20%. The swing amounts to almost 23 percentage points. If we continue to see comparable momentum in the fourth quarter, we will achieve our guidance for the full year 2025. There are 2 main reasons for this positive development. One, due to increased hardware sales, we were more successful than in the first half of the year in obtaining vendor bonuses and kickbacks. And two, the increase in costs was very moderate. Other operating expenses increased at a lower rate than revenue did. And personnel costs in the third quarter were below the level of Q1.

And so to conclude our review of the key figures, the obligatory plants at the operating cash flow. Cash flow, too, developed very positively in the third quarter. It sounds at almost EUR 125 million, reflecting the usual seasonal trend at Bechtle. Not only do we see a clear improvement over the course of the year, we're also within striking distance of the already very strong quarter last year. It is remarkable that we were able to achieve this level despite the upturn in our operating business, especially in September. Normally, such developments are also reflected in cash flow, albeit with higher receivables and inventories on the reporting date, which have a negative impact on this key ratio. This reflects the success of the measures we have implemented in recent years as part of our working capital management, enabling us to better buffer operational cash flow growth, so to speak.

So let us now turn to our workforce. As of the 30th of September 2025, Bechtle had 16,300 employees. That's 692 people or 4.4% more than in the same quarter of the previous year. This increase is exclusively due to acquisitions. The acquisition of Grupo Solutia in Spain alone brought 646 new colleagues to the Bechtle Group. In purely organic terms, the number of employees fell by 1.6%. It remains a deliberate management decision not to expand the workforce further in these challenging times. We are currently relying on natural attrition and are not immediately refilling vacant positions. However, we continue to invest consistently in the training of young people. We are, therefore, very pleased to have welcomed 251 young colleagues at the start of the 2025 training year. As of this 30th of September, a total of 853 young people were in training at Bechtle. And so as is customary at this point, let us turn to what we consider to be the nonfinancial significant events of the third quarter of 2025.

These latest announcements are all forward-looking and underlying Bechtle's future viability. So this time, we look ahead to an important personnel change, 2 acquisitions and perhaps rather surprising announcement on the subject of digital sovereignty and a milestone in our sustainability strategy.

Well, let's start with the personnel change. At the beginning of this week, we published a statement that replaces the question mark behind my succession with an exclamation mark, if you allow me to put it like this. My fellow Board member, Konstantin Ebert, is to take over my position as CEO at Bechtle from January 2027 onwards. Together with the nomination of Chris Jehle as CFO on 1st of January 2026, my succession has thus been settled for the long term and early on. It was important to the Supervisory Board and to me that the transition could take place calmly and according to plan. We have now created the conditions for this. And in doing so, we are once again underlining Bechtle's reliability, both internally as an employer towards our customers but also towards the capital market.

And just to anticipate any questions you might have. My contract runs until the 31st of December 2026. And until then, I will continue to work with the same energy and disciplined, full conviction and enthusiasm for Bechtle.

Let's now take a look at our international acquisitions. With Nuovamacut Automazione, Bechtle has acquired the largest partner for SOLIDWORKS in the Mediterranean region. The company was founded in 1995, is headquartered in Bologna. Has 7 other locations in Italy's most economically powerful regions. The company employs 149 people, and it has to achieved the business volume of over EUR 63 million in the past financial year. The CAD and PLM specialist is the market leader in Italy and counts around 5,000 predominantly midsized companies from the manufacturing industry among its customers. This is an important step for our European positioning in the PLM solution business.

We've also acquired the Dutch IT service provider ITAM Solutions based in Eindhoven. Founded in 2007, the company specializes in IT asset management solutions and offers its customers comprehensive consulting services for cloud cost management. ITAM Solutions employs 38 people and achieved a business volume of EUR 4.4 million in the past financial year. The specialist has already been fully integrated into our subsidiary, PQR.

This brings us to the topic of digital sovereignty, which is currently a subject of intense debate throughout Europe and Germany, in particular. In this field, which is important for the future of all of us, we have broken with our previous strategy of not entering a market as an early adopter by developing a software-based measurement method for assessing digital sovereignty, a measurement method that does not yet exist in this form. The Bechtle Index of Sovereignty is designed to have business and public sector organizations to determine the maturity level of their digital sovereignty in a structured manner and derive concrete measures based on the results. The Bechtle Index of Sovereignty will be rolled out in the first quarter of 2026 and is currently truly unique in the IT market.

The Bechtle Index of Sovereignty focuses on the dimension of data ownership, technological independence and strategic autonomy. The benefits for the customers are, amongst others, that they gain transparency around potential dependencies. They can identify risks that compromise independent decision-making and action and they can take meaningful steps to strengthen their digital sovereignty over the long term.

Finally, let's take a look at our activities in the area, sustainability. We have now received official confirmation from the science-based target initiatives, SBTi insured, that our net 0 targets meet the criteria of the SBTi. Following the validation of our near and midterm climate goals earlier this year, our recently submitted long-term net zero targets for 2050 have now also been assessed and approved in line with scientifically recognized standards. With it sets net zero targets, Bechtle commits to reducing absolute greenhouse gas emissions across Scope 1 and 2 by 90% by 2050. And in the relevant areas of Scope 3, the company aims to cut emissions by 97% per EUR 1,000 of value creation and remaining emissions are to be neutralized. The key levers for decarbonization are the areas of energy, mobility and procurement. The validation of the 2050 targets underlines Bechtle's long-term commitment to climate protection and sustainability along the entire value chain.

This brings us to the outlook, ladies and gentlemen. Well, the overall economic situation remains tense. In our largest national markets, Germany and France, in particular, we are still seeing a certain reluctance among our SMB customers to invest in IT. However, we're also seeing an upturn in business with our public sector customers and higher demand in our traditional e-commerce business. During the third quarter, this upturn was particularly strong in September. And according to the first operating figures available for October, this positive trend is continuing, and this also goes for November. In concrete terms, this means our outlook in terms of business volume and revenue, we are on track with our guidance for the full year of the 9 months. However, we still need to catch up in terms of EBT.

And of course, we know that the required EBT growth of at least 25% in the fourth quarter is ambitious, indeed. But with the momentum like we saw in the third quarter that target is achievable. The swing of around 23 percentage points that we saw in Q3 is exactly the growth that would help us to achieve our guidance in the fourth quarter as well. And we've already proven several times in the past that we can deliver a strong finish. We are, therefore, confident that we will be able to achieve our EBT target within the specified range. And in this respect, we are once again confirming our guidance from March 2025.

That, ladies and gentlemen, is all we have to say about our performance in the third quarter of 2025 and the outlook for the fourth quarter of 2025. Thank you very much for your attention, and I'm looking forward to your questions.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]