Forvia Stock

Good morning, ladies and gentlemen, and welcome to our H1 2026 results call, which I'm, as usual, presenting together with our CFO, Olivier Durand.

Good morning.

Before we start, let me remind you that our 2026 and also the 2025 H1 results are presented excluding Exteriors, excluding Interiors, since we plan to divest from it by year-end. So here's a brief look on today's agenda. I will start with our key highlights for the first half before handing over to Olivier, who will present our financial results. I will then come back to discuss our outlook for 2026, and we will conclude the program with a Q&A session.

So let's start with key takeaways from the first half. Our activities have been fully focused on the execution of the IGNITE plan that we presented at our Capital Markets Day in February. Over the first half, we delivered tangible progress across all 3 strategic priorities.

So let me start with performance. We improved our operating margin through disciplined fixed cost reduction, greater cost flexibility and effective management of inflationary pressures. We also delivered an 18% increase in net cash flow with improved quality again. So this enabled us to reduce net debt by EUR 0.5 billion, which marks the largest semester of organic debt reduction since the HELLA acquisition in 2022. Order intake was equally strong, increasing by 15% year-over-year.

And we move to transformation. So first of all, let's talk about the Interiors divestiture. Here, we made good progress toward the completion of the sale of the business to Apollo. Several important milestones have already been achieved, including U.S., European, French antitrust clearances and the completion of the consultation process with the European Works Council. So we remain on track to complete the transaction in the fourth quarter of 2026 on metrics that are fully consistent with those presented at signing.

Under transformation, innovation also remained a key focus. We held dedicated technology sessions organized across businesses and regions. These events are great motivators for our teams to accelerate innovation and strengthen cross-functional collaboration. As a result, we advanced our technology road map with many market-relevant innovations across the entire portfolio.

Let's talk about the Lighting business next. All of our business groups improved their performance in H1, except for Lighting. HELLA management pushes the Lighting transformation program really hard with determination and has taken decisive actions to improve both profitability and growth. And last but not least, we have started leveraging our industrial know-how and advanced technologies to pursue selected defense-related activities. I'll be getting back to those in a minute.

Finally, the third pillar, our culture. This is one of the topics that I'm personally paying close attention to since culture drives ultimate performance orientation into the group. We continue to roll out our Guide, Empower and Recognize principles across the organization. Project SIMPLIFY is delivering results right now. In the first step, the organizational structures were streamlined and now the focus is on process optimization. Through our business transformation studio, we automate processes and deploy AI, particularly in engineering and purchasing, and in supply chain management. So in summary, we create less bureaucracy, faster execution and much better ownership with the leaders and the teams.

So here comes the resulting performance from H1. In fact, the results from half 1 mark our third consecutive half year of improved performance. And with this, we are firmly on track to deliver our full year guidance. Sales reached EUR 10.8 billion at constant exchange rate, placing us in the upper half of the guidance range. Margin improved by 30 basis points to 6% and net cash flow has also increased, now reaching 4.1% of sales, while leverage continued to decrease organically to 1.6x. So automotive production declined by 1% globally, and we mitigated rising inflation under increasing geopolitical tensions. Here, I would really like to thank the global FORVIA team who delivered despite a challenging environment. Thank you very much for that.

So what's driving the performance? Actually, we continue to benefit from improvements across our operations. And this is reflected both in our operational metrics and in recognitions, which we received from our customers. We made significant progress in deploying the FORVIA Excellence System across our industrial footprint and also by increasing the convergence with HELLA. The number of FES focused plants was reduced by 18% in 6 months. Those are the plants that we want to uplift in performance and FES performance very consciously. And these remaining plants are being closely monitored and expected to improve rapidly.

The progress becomes particularly visible in North America, a region that caused concern in prior years, and you remember that. So right now, launches are being delivered flawlessly, and General Motors alone rewarded 8 of our sites in North America with quality excellence awards. All global efforts contributed to a 33% reduction in customer claims versus prior year. That's a significant improvement in our delivered quality. So I'm happy to share that our operational excellence and innovation capabilities were recognized by a number of key customer awards. General Motors recognized the creativity of our electronics team; Ford, our excellent collaboration. And in China, Geely and Chery both appreciated FORVIA's outstanding innovations. These recognitions underline FORVIA's strong positioning for further growth.

We're now getting to the Lighting transformation program. So HELLA Lighting continues to rely on its tech leadership and a full product range. However, the financial results in H1 marked the bottom with an operating income of 0.3%. This is driven by an organic sales decline of 4.7% in H1, which continued the trend that we have seen since H2 2024. So the transformation program is key, and it is currently being accelerated with a clear priority on improving the bottom line while building sales momentum. So we enhanced competitiveness by adjusting our R&D and manufacturing capacities by an enhanced implementation of the FES and CapEx and working capital both follow new targets.

Last but not least, to SIMPLIFY, SG&A will be driven based on a benchmark. The actions currently underway will begin to deliver tangible benefits in the second half of 2026. Looking ahead, our committed goal is to progressively recover our 2025 operating margin by 2028. This, by the way, is fully consistent with the overall 7% margin ambition for the value cluster that we outlined at our Capital Markets Day.

In parallel, we are step-by-step rebuilding a stronger pipeline of business by being more present in the mass market and diversifying our regional reach. Our efforts have started paying off with an order intake in H1 twice as large as in H1 last year. So there is significant share with volume customers as well as with customers outside of Europe. The expected acceleration in sales from 2028 onwards should provide a strong operating leverage effect, supporting a further improvement in operating margin. So the challenges are very well understood. The action plans are underway, and I can assure you that the turnaround of Lighting is at the very top of my priorities.

Let me now turn to order intake, one of the very good results of the first half and a strong indicator of the growth opportunities ahead of us. Order intake reached EUR 13.4 billion, and that's without the interior orders. It is up 15% versus the first half of last year. This performance reflects the strength of our position in the growth areas identified at our Capital Markets Day. In fact, our growth cluster accounted for 60% of total order intake and delivered a strong book-to-bill ratio of globally 1.5x.

In Seating, the most notable highlight is that half of order intake comes from conquest business. This reflects the strength of our offering and our ability to win market share. We also continued to make significant progress with Chinese OEMs, which accounted for 27% of the Seating awards. In Electronics, we secured significant awards in fast-growing technologies, including around EUR 1 billion in energy management, software-defined vehicles and in-cabin experience solutions. A major European contract for our interior monitoring systems is worthwhile mentioning.

At group level, we progress well on diversification. 30% of total order intake during the first half is with Chinese customers, Japanese customers, Korean customers, commercial vehicle and specifically also India. In India, our order intake reached EUR 600 million compared with H1 '26 sales of EUR 235 million. So you can see the growth. Most notably, we secured our first complete seat business, which will support the construction of a new just-in-time seating plant in India. The start of production is planned for 2027. This will bring our industrial footprint in the country to 10 plants. And with about 2,500 engineers based in India, we are dedicating part of this talent pool to support the further strong growth expected in the country.

So let's go to China. Beyond the seating wins that I already mentioned, we continued to make strong progress with Chinese OEMs. They represented 17% of total order intake, corresponding to a 3x book-to-bill ratio. More than 70% of our Chinese order intake came from Chinese OEMs, and that's fully reflecting the shift of the Chinese market where they now account for a similar share of vehicle production. Notable wins were attained with Chery, Changan, Leapmotor, a new fast-growing EV tech player and our long-standing partner, BYD. So you can see how we further diversify our Chinese customer base. Overall, the quantity and quality of our order intake gives us confidence in the future growth of our business. Building on additional wins already secured in July, we are confident in our ability to sustain strong order intake momentum across the year.

What's driving the growth? Let me turn to innovation, and that remains at the heart of our strategy. And again, that's a key growth driver. Across our pursued trends of electrification in cabin experience and safety and comfort, we continue to develop technologies that address major transformations shaping the industry. In Electrification, we will start production of our first integrated 12-volt lithium-ion battery pack next year. This solution reduces weight, it simplifies vehicle integration and has already won significant businesses with several international OEMs. We are also expanding our portfolio for extended range electric vehicles and plug-in hybrid vehicles as well with a new adaptive valve. So this valve in the exhaust system reduces the weight of the entire system. It creates space for additional battery capacity and it particularly reduces the muffler volume and therefore, also the cost of the system.

Moving to the next column here. In our in-cabin experience, Appning, our apps market that combines third-party apps, vehicle functions and location-based services now provides drivers the benefits of an AI assistant for seamless interaction with that infotainment system and the vehicle in general.

Next one, in safety and comfort, we will soon launch our transformer seat for Chinese OEMs. Remember, that's our AI-powered adjustment where Olivier, you get your setting when you enter the car, I get mine. They're slightly different. And also the seat adjusts during driving situations, depending if you are more sporty or more relaxed in using the vehicle.

Last not least, in Lighting, we successfully launched our highly adaptive high-definition lighting solutions in China. The product performance and the cost have both been tailored to the fast-moving Chinese market. Altogether, these innovations demonstrate our ability to anticipate market trends, and we clearly bring differentiating technologies to production, which will support our future growth. So in general, our strategy remains unchanged. First, we focus on strengthening our core businesses. Second, we selectively expand into adjacent markets. Defense is one of these opportunities for FORVIA.

Through FORVIA HELLA, we already have long-term experience in delivering lighting and electronics products into the defense market. And this gives us a deep understanding of the ecosystem and its processes. So now we can create value in 2 dimensions. On the one hand, through our industrial know-how and available capacities and on the other hand, through our technology and products. So on the industrial side, we benefit from a strong Franco-German footprint, which is fully aligned with European sovereignty ambitions and 2 strong marketplaces.

On the technology side, you can easily see how actuators, sensors, energy management systems qualify for emerging applications just as drones. Just think about the low-voltage battery pack we discussed before. This is a lithium voltage pack up to 50 volts. And these will be produced in volume for automotive and can then power drones in the same good way. Therefore, our recently announced drone partnership marks an important step. From assembling first drones now, we are exploring the entire opportunity.

Next to the assembly and component supply, the defense sector also offers opportunities to adjust our capacities. The Augsburg plant in Germany is being transferred to General Dynamics, which is a good illustration of that adjustment of capacities. We can offer 300 employees a new perspective. So this preserves employment, it avoids restructuring costs and supports long-term industrial activity. So you can see how we take a disciplined approach to diversification. It is about new markets, it's about new customers and the same FORVIA capabilities.

Moving on to culture. As I said at our Capital Markets Day, delivering IGNITE is not only about strategy. It is also about culture, leadership and the way we work. During the first half, we continued to build momentum. We engaged more than 6,000 managers worldwide behind our IGNITE ambitions and priorities. That was a massive communications and leadership task. Also, we trained our managers on GER, Guide, Empower and Recognize. This is our new leadership framework that represents a significant departure from our previous top-down management approach.

We are building a culture of performance through empowerment and accountability. A very good example for that is our Saline facility in Michigan. You know about that place because in prior years, the plan had caused significant losses when launching new products. The plan has now returned to decent profitability. Certainly, the group provided support to that recovery. However, in the end, it was not all the help we parachuted in that created the turnaround. It was to strengthen and empower local leadership team that managed the breakthrough.

Another area of continued focus has been safety. I'm pleased to report further very significant progress. Our accident rate decreased by 37% to reach 0.89 in FR 1T, our metric. We are now already in line with our midterm target of an accident rate below 1 as presented at our Capital Markets Day.

And last not least, on culture, we also took a very strong start into the year giving back to our communities. Through the FORVIA Solidarity days, more than 16,000 employees engaged in over 560 local initiatives around the world. So I have to say 18 months into building a new FORVIA culture, I'm truly encouraged by the progress and the engagement I see across the organization and across the globe.

So to sum it up, in the first half, we made solid progress in executing on our IGNITE road map, which is built around 2 consecutive phases: focus and strengthen, and lead and grow. Being in the middle of Phase 1, we delivered further improvement of our financial performance. The Interiors divestiture is on track for Q4, and our cultural transformation is gaining momentum across the group. At the same time, some of these results already prepare us well for Phase 2. Order intake increased significantly, supporting our ambition to accelerate growth in the years ahead.

Our innovation road map continues to differentiate FORVIA in the most attractive market segments. We have opened up new growth opportunities also in the defense sector for several of our activities. So overall, these achievements reinforce our confidence in our ability to deliver on our 2026 objectives and to create long-term value.

With that, Olivier, I would like to hand over to you for more detail on the H1 results.

Thank you, Martin, and good morning, everyone. As communicated at our Capital Market Day at the beginning of the year, our segment reporting is now built around 6 activities, which are structured on growth cluster and value clusters. In this context, Electronics is now reported separately with HELLA Electronics included in the growth cluster, while Clarion is part of the value cluster. Let me remind you the principle of the different -- of the 2 clusters. Growth cluster is focusing on accelerating growth, strengthening technological leadership, diversifying customers and partnerships and supporting disciplined investment. The value cluster is focused on operational performance, cash generation and value creation.

Let me start the financial presentation with the sales and the operating margin. Once again, we delivered a meaningful step-up in profitability despite a challenging market environment. The reported sales amounted to EUR 10.5 billion, down 4.3% versus H1 '25. On an organic basis, i.e., excluding foreign exchange variances, sales declined by 1.9%, slightly below global automotive production, which was down 1% in the period. In this context of soft sales, we increased operating income to EUR 632 million and delivered an operating margin of 6%, up 30 basis points year-on-year. And this is fully in line with our guidance range for the year.

This performance reflects, first of all, strong operational execution. It shows also that the productivity initiative and disciplined fixed cost management from EU FORWARD and the rapid rollout of our Simplify programs are paying off. The residual impact of inflationary pressures related to Middle East conflict was limited in the period. So in short, in a challenging market context, we maintain our strong cost discipline to further improve our operating profit performance.

Let me go now on the regional performance for more details in sales and margin results. Overall, we delivered solid performances in the Americas and in Europe, while we continue to demonstrate resilience in China despite a reduced level of activity. As in the first quarter, North America and Europe continued to outperform underlying automotive production and delivered growth despite a soft demand environment. This was driven by Electronics, Clarion and Clean Mobility. In China, performance remained impacted by customer mix effect, particularly with BYD. In the rest of Asia, however, we continue to deliver strong growth, and we have significantly outperformed the market in those countries.

If I turn to profitability, the regional picture is encouraging. In North America, operating margin increased sharply to 7.1%, up 170 basis points year-on-year. This improvement was driven by stronger operational performance and by Clean Mobility activity. In Europe, the margin improved to 3.7%. It reflects the continued benefit of EU FORWARD rollout as well as the ongoing challenges in Lighting. In Asia, margins remain at a very robust level of 9.8%, which is up 20 basis points year-on-year. This reflects the continued improvement in the rest of Asia, combined with highly effective cost flexibilization measures in China. As a result, the group regional profit contribution has become more balanced compared to the past. We have a resilient model in China, further upside in Europe and sustainable improvement in North America.

Let me turn now to the performance by the respective clusters. I will start with the growth clusters. There, sales were down 4.8% organically to EUR 5.5 billion, with strong growth in Electronics more than offset by softer sales in Seating. Electronics continued to benefit from solid demand in radar and Energy Management, while Seating was impacted by the significant unfavorable customer mix in China that we mentioned before. When we look ahead, commercial momentum is remaining strong. Order intake is reaching EUR 8 billion in this cluster, and it represents a book-to-bill ratio of 1.5x, which provides good visibility on the future growth.

Operating margin in the cluster improved by 20 basis points to 6.1%. This was driven by disciplined R&D spending in Electronics on the one hand and strong operational -- stronger operational execution in Europe and in North America as well as the continued cost flexibility measures in China in Seating on the other hand. Overall, the growth cluster demonstrated its ability to improve profitability while building the solid foundation for the future growth.

Now I turn to the value cluster, where we are pleased to report another solid performance, both in terms of sales and in terms of profitability. The sales grew 1.5% organically, driven by strong momentum at Clarion, particularly with Japanese OEM and a mid-single-digit growth at Lifecycle Solutions. Clean Mobility was roughly stable, building on our strong momentum in North America. These positive trends have been partly compensated by the expected evolution in Lighting, which reflect the program phaseout in this business.

The cluster also delivered a strong profitability performance with operating margin improving by 60 basis points to 6%. Expansion was primarily driven by Clean Mobility, supported by cost reduction initiatives, while Lifecycle Solutions and Clarion benefited from favorable volumes and mix. Lighting remains a key area of attention, and we are fully focused on executing the transformation plan that Martin presented earlier. Overall, the value cluster demonstrates its capacity to combine resilient growth with improving profitability.

Let me cover now the rest of the income statement. The net income group share is reaching breakeven at EUR 3 million in H1 '26. This is a significant improvement compared to the loss of EUR 269 million that we recorded a year ago. This progress is driven by solid operating income, lower restructuring costs that peaked in '25, lower financing costs, reflecting the reduction in gross debt. It is also worth recalling that last year first half result was heavily impacted by the nonrecurring charge of EUR 136 million related to Symbio.

When I look forward to H2, as communicated during our presentation of the '25 results, the divestiture of Interior is expected to trigger a one-off charge at closing of around EUR 150 million in H2. This is related to taxes at closing on capital gains in certain jurisdictions and the recycling of cumulative currency translation reserve to the P&L.

Let me highlight that the cash out of this charge are already priced in the metrics of the transaction that we previously communicated and that we confirm. While reported net income is expected to be negative in the second half, including due to the one-off items that I just mentioned, the underlying trajectory continues to improve.

Let me cover now the net cash flow. We delivered a strong and high-quality net cash flow in the period. It is up 18% year-on-year to EUR 432 million, representing 4.1% of sales. Important to mention, working capital and factoring had a limited impact in those results. Actually, the recurring net cash flow, which exclude working capital movement, exclude factoring and other operating items, stood at EUR 403 million, 3.8% of sales, up 70 basis points year-on-year. This performance was supported by strong underlying profitability, EBITDA increasing by 40 basis points and low level of investment.

Related to investment ratio, it was at a low level of 4.8% of sales. We expect some catch-up in the second half. This is reflecting both the normal phasing of our investment and one specific transaction that I will comment in a minute. We anyway expect that the full year investment ratio to be between 6% and 6.5% of sales, i.e., broadly in line with last year. Net cash flow also reflects a EUR 62 million increase in restructuring cash out. We mentioned before the restructuring cash out is expected to peak in '26 at around EUR 300 million and before progressively declining thereafter, and we confirm that. Overall, this is a robust and sustainable cash flow performance, demonstrating stronger cash conversion and the growing quality of our earnings.

For the second half, we expect the net cash flow to remain of good quality, but I would like to mention 2 clearly identified one-off cash outflow. The first one is the exercise of a purchase option on a major manufacturing facility in Mexico, which will temporarily increase the CapEx, but vice versa reduce our lease liabilities. And the second one is the settlement of some past historical tax litigation, which will increase temporarily the cash tax payments. Together, those 2 nonrecurring items are expected to represent approximately EUR 150 million of cash outflows in the second half '26. Those one-offs are fully reflected and integrated in our confirmed net cash flow guidance of at least 3% of sales for the year '26.

I will mention -- I will comment now the net cash -- the net debt, sorry, and leverage on a pre-IFRS 5 basis since the Interiors transaction is not yet closed. During the first half, we reduced the net debt by EUR 503 million. The net debt went down from EUR 6 billion to EUR 5.5 billion. As already highlighted by Martin, this represents the strongest semester of organic net debt reduction since the acquisition of HELLA. The reduction was driven by EUR 579 million of net cash flow generation when we combine continuing operation and the interior business. As a consequence, the leverage continued to improve, and we went down from 1.7x to 1.6x, keeping us firmly on track to achieve our year-end guidance of 1.5x at the end of '26.

Looking ahead, we expect the Interiors transaction to close during the fourth quarter. And upon completion, we confirm that the transaction should generate more than EUR 1 billion of additional net debt reduction, providing a further step change in our balance sheet strengthening. In other words, we are already delivering meaningful deleveraging organically and the closing of Interior divestiture will provide an additional and significant net debt reduction in the second half.

Let me conclude this financial presentation with our debt profile. Financial flexibility continued to improve across the board. FORVIA has reimbursed around EUR 850 million debt maturities since the start of the year, including the repayment of the EUR 428 million Schuldschein in July. Having now cleared virtually all '26 maturities, our stronger cash flow generation profile and the expected proceeds from the interior divestiture gives strong visibility on our debt management. Liquidity has also been significantly strengthened through the successful renewal of the FORVIA revolving credit facility of EUR 1.5 billion, which is now maturing in '31 with the extension option of up to 2 additional years. On a pro forma basis, end of July, gross cash amounted to EUR 4 billion.

And on the credit side, let me recall that those recent progresses as well as the announcement of the sale of Interiors have led to both Fitch and S&P to improve their rating outlook in the course of the first half. So overall, the first half demonstrate FORVIA's ability to improve profitability, strengthen cash generation and continue deleveraging and debt reduction even in a challenging market backdrop.

With that, I hand over to Martin for the outlook '26.

Okay. Thanks a lot. So let's go over that outlook. The market environment is expected to remain challenging with global automotive production projected to decline by around 3% in H2 compared with the second half of last year, and that's happening across all major regions. Based on our H1 sales performance and our current assumptions for the second half, we expect full year sales to be in the upper half of our guidance range. That said, we remain cautious given the uncertainty that continue to affect the market, including geopolitical tensions, developments in China and the broader inflationary environment.

In this context, our priorities are very clear. First, we will continue to maintain strict cost discipline and ensure that inflation is offset through operational actions and commercial recoveries. Second, we will remain focused on cash generation. And third, we are fully mobilized to close the Interiors transaction in the fourth quarter. Finally, we intend to build on the strong commercial momentum achieved in the first half and maintain a robust order intake pipeline to support future growth.

Overall, while the market backdrop remains challenging, we are confident in our ability to continue executing with discipline and to deliver to our commitments. So therefore, our 2026 guidance is fully confirmed. Sales is expected to be between EUR 20 billion and EUR 21 billion at constant exchange rate, operating margin between 6% and 6.5%, net cash flow at least 3% and the leverage ratio down to 1.5x.

With this, I would like to thank you for your attention, and now we are happy to take your questions.

[Operator Instructions] The first question comes from the line of Michael Foundoukidis from ODDO BHF.

Yes, Mike Foundoukidis from ODDO BHF. Congrats for the results. Three questions on my side. First one, on North America, margin was very strong at 7%, which is a level I'm not even sure that you ever reached. Olivier, you framed the performance in your comments as sustainable. So would you consider this 7% plus level as a new normalized ambition going forward in the region? That's the first question.

And second question is more on H2 margin. Usually, and given the restructuring going on, it's better in H2 versus H1. But you have raw mats, you have other probably headwinds in H2 with production, et cetera. So could you give us some color on the puts and takes for H2 margin and if we should improve sequentially better H2 versus H1? And last question is more long term and more for Martin probably. But following the interior disposals, what will be the next capital allocation priority after deleveraging?

It's a good set.

Yes, very comprehensive set, Mike. So let's get started. North American margin, very strong. Is that sustainable? And here, I'm happy to report, yes, it's really the operational performance that you see in the margin. So no special effects that would have boosted in H1. And it goes back to what I said, we have really stabilized the operations. And in that sense, looking forward, we want to enjoy that same level of profitability from the North American region. Maybe in short, H2 margin expectations, yes, we expect them to be at least as good as in H1. And maybe you want to give it some color, Olivier.

Yes. So in terms of raw material, so the raw material has, of course, the price increase related to inflation. We anticipate, in fact, that the impact of the inflation is higher in H2 than in H1, but we expect also that our compensation measures internally as well as pass-through unable to have an impact fairly similar in absolute terms between H1 and H2. On the activity itself, we -- you see that in the first half, we are on a fairly good trajectory compared to our guidance, and we expect that to remain under the current conditions. Of course, we are very careful in this matter given the uncertainties in the China market, and I would say the volatility related to the Middle East geopolitics.

Good. And then we get to question number three. How about capital allocations beyond the interior disposals? So let's quickly reflect where we are in the journey. So we stay by the guidance of 1.5x leverage by year-end, and that is including the divestiture of Interior. Now many you recall our IGNITE strategy, we said by 2028, we want to get the leverage down to 1.2x. And that is the target point by which we will become a much more normal company in the sense that we can qualify back to investment grade and have also the freedom to allocate capital not only to the leveraging, but also we want to invest into further growth and consider our investors, our shareholders in terms of capital allocation. So the Board, the management are committed to thinking of investors and thinking of instruments like dividends and share buybacks once we reach that level of leverage that I just described.

The next question comes from the line of Christoph Laskawi from Deutsche Bank.

I'd like to start on an announcement of VW from last Friday where they essentially said that they want to reduce the variance of their vehicles quite substantially and also the component variance within them. They called out essentially in the mass market side, seat main modules to be reduced by 30% and in the premium side, the seats variety to be cut by 90%. Just wondering, given it's one of your biggest customers, how you think this would impact your business? Is it helpful given your broad offering? Or would it make the RFQs way more competitive?

And then secondly, just on China, obviously, significant underperformance. At the same time, the margins are pretty stable. Could you share a bit more detail on how you manage that on the margin side and when we could expect the underperformance to improve again?

Thanks for those 2 questions. Let me start with Volkswagen's announcement to reduce the variance both for vehicles and components. We welcome that. We applaud that step because overall, it takes complexity out of the system that we have faced as suppliers, and that is definitely impacting the competitiveness of the Volkswagen product and therefore, our sales ultimately as well. So we fully appreciate that trend. And we feel that we are very ready to compete in that space. If I just look at our growth cluster, Electronics and Seating, we have shown good strength again this first half in acquiring new business. And what's really outstanding, for instance, on the seating side is that we have quite a high share in conquest business. That's proving the competitiveness. So we'll go after these big chunks of business, and I'm confident we'll be successful.

The second one in terms of China underperformance, you read that well. We have still a setback from our exposure to BYD that has been weak in the last couple of quarters. The good news is BYD is starting to catch up again. It's stabilizing. Nevertheless, we see that in the sales result. And you also well observed that we could sustain margin. And that goes back to really very strict cost management, where the local team in China flexed our internal costs and where we work very diligently also with our supply base to make sure we can deliver the same margins under these reduced capacities that we need.

Going forward, you heard about our order intake. It's strong. It's strong in China, 17% of our global order intake going into China and also with a diversified customer base. So if we take the typical lead time of 1 to 1.5 years, you can see how this new sales is going to boost our top line in China. So we remain fully committed to the regions, to our Chinese customers. We want to serve them in China and in the world, and we will see that in the sales curve swinging back as well.

We now have a question from the line of Jose Asumendi from JPMorgan.

A few questions, please. Can you comment on how do you manage to maintain such strong earnings seen in Asia with the decline in revenues? That was, I think, very impressive in terms of how you managed to hold up margins there. Second, can you comment on the key elements of self-help and cost savings you plan to book in the second half of the year on a group level? And then three, can you comment on Seating, which are the key maybe actions to improve the profitability beyond the current levels?

All right. Jose, good morning. So let's start with the maintained margin in Asia. I commented already on our activities to flex our cost to work the entire cost base in China. Just to add, our local to local helps very much in that context. So remember, we are deeply localized in the Chinese market. And the pressures that we can, of course, feel from the OEM side are completely transferred also on the supply side. So we stay in shape and we maintain our margin. The rest of Asia is a good profitability, too. So that adds to that overall published number.

Number two, cost savings to be planned for H2. The good news is that we have quite a number of initiatives that have been running and have been running over the semesters. So if you go back 2 years, we started EU FORWARD, and we have taken another lift up in EU FORWARD savings. End of the last year, we shared a number of 6,400 agreed departures from FORVIA. That number has now gone up to 7,300 by the end of H1 2026. That's still the parameter including Interiors. So you can see how that include -- consequently increases the savings from the restructuring.

Large program #2, SIMPLIFY. So we had predicted 40% of the EUR 110 million savings to be effective in 2026. That's also happening. So overall, from these programs, we can look at EUR 110 million roundabout of savings in the entire year 2026. So that boosts H2. And then it comes to really short-term adjustments. We stay cautious about the volumes in the market, and we are ready to react and to flex on all cost levers. And let me tell you one thing. Here, our cultural transformation really plays in nicely. So the empowerment, the delegation of responsibility in the organization shows real effect because not every action has to be directed from the top of the house, but it's happening as we speak in the plants where the profitability is really ensured.

Question number three, Seating actions for profitability. So here, you also see from the results that Seating has very well accommodated the sales weakness with China customers. and has stood by its profitability of before. So also here, fantastic flexing taking place, and we are going to continue that in the year. Our focus for Seating, sure, we want to maintain profitability, but our focus clearly goes in the direction of growth. And here, diversification of the customer base, moving into commercial vehicles also geographical expansion in India with that first full seat business now and a new plant in India. That's the key orientation for Seating. That makes perfect sense because Seating is part of our growth cluster, so we want to boost that direction.

In light of all the self-help cost savings, price recoveries in the second half of the year, I know the market outlook still is very uncertain. But is there not a chance to potentially upgrade the guidance in the second half of the year?

I mean when you look at our guidance, we see that sales is going to be in the upper half of our band. And we think that consecutively, the H2 profitability is going to be at least what we delivered in H1, but that keeps us well in the band that we have guided and recommitted today.

The next question comes from the line of Vanessa Jeffriess from Jefferies.

Congratulations on the results. First, I just wanted to ask about the sustainability of some of the large margin improvements you saw like in Lifecycle Solutions and in Clarion, which also faced some memory headwinds. Because I guess to me, if I just use first half '26 as an example and put your 3% target on Lighting, you're almost nearly at your 2028 margin target and not that much to do in the rest of the business. So the biggest piece is really Lighting. Is that fair?

So I think you are mentioning the totality of the cluster. So I would say that Lifecycle Solutions is on the high side in terms of profitability profile. It's really a very good semester that has been recorded by Lifecycle. And Clarion, it's really a sustainable progress. It's not only the growth in revenues, but it's also the outcome of all the actions that have been done in terms of rationalization of the R&D in particular, but as well previously of the manufacturing footprint. So clearly, this is showing progress there. And indeed, the -- let's say, the contribution that is really to improve is what you mentioned, which is Lighting, and this is what we are mentioning with the transformation plan that has been described by Martin before and starting with returning to 3% in '28. And that will be a good complement to the evolution of the cluster indeed.

And then congratulations on your progress in defense. I was just wondering if you could talk more about the attractiveness of either volume or profitability in that area because we've heard some different things, I guess, from different companies.

Yes. No, good question, Vanessa. So yes, we made a very conscious decision now to extend further into the defense space. And I'll tell you, we have already a good foothold into that market space. This FORVIA HELLA that for many years have sold Lighting and Electronics products basically to defense vehicles. So we understand the ecosystem. We understand the processes. And we have now very intensely over the last 6 to 9 months looked at that field of drones. That was the announcement this week that we have secured a first assembly contract for drones.

Why do we think it's good for us to play in that field? So I talked about the familiarity, and we see basically 2 ways to conquer that space. One is through manufacturing capabilities and capacities. The other one is through components. We have capacities in Europe, in Germany and France specifically in our plants that we can use for that kind of business. And we see the investment that goes with it as limited and very manageable for us.

And then when we go on to the component side, I mean, those products that I mentioned earlier, right, for energy management, for battery packs, for motors, for actuators, that's right in our wheelhouse. So it is really a very proximate adjacency that we can use. So that gives us the confidence that we can go into that market, convince more customers, and we do it in a serious manner. So we have now a dedicated team in place that will explore opportunity by opportunity, and we'll book them one after the next. So I hope that describes the rationale good enough for you to relate to it.

Yes. And finally, I was just wondering if you could talk about the Chinese OEM order intake year-on-year. I guess if you work it out from the presentation last year, it looks maybe lower year-on-year, but obviously, the numbers aren't comparable. So I mean, just if you can talk about that progress. And then also just wondering if you're still assuming fourth quarter for BYD in Hungary.

Yes. Let me answer on the Chinese OEMs. It is a good number again, and maybe we didn't show it in the same format, but let me give you some clarity on that. So 17% of our global order intake is with Chinese OEMs specifically. So this time, we chose to show that, and it compares to about 10% of their share into our 2025 sales. So you can see that there is quite an upswing. I think the book-to-bill ratio, if you would calculate that is about 3x for the Chinese OEMs. And maybe, Olivier, you want to comment?

The second part of the question, we confirm that there will be activity with BYD in Hungary. And actually talking about Chinese carmakers in Europe, it will be also the case with Leapmotor in Spain.

We now have a question from the line of Ross MacDonald from Citi.

I have 3 questions also. The first 2 on the cash flow generation, which is obviously very strong. So my question is for Olivier on those 2 items. Olivier, you touched on some of the second half step-ups in terms of headwinds on the free cash flow side. I just wanted to make sure that when we go through the net cash flow bridge that I am on top of all of these. So you mentioned the purchase option in Mexico and the assessment of tax litigation. I think that was EUR 150 million of additional. It looks like on your CapEx guidance, that will step up probably from 4.8% to maybe something like 7% of sales in the second half.

What are the other moving parts in terms of free cash flow generation? Should we expect a neutral impact from working capital? Obviously, it sounds like margins will be flat or up on EBIT. But altogether, how do we think about the sort of quantum of free cash generation in the second half? It looks like you only have to generate under EUR 200 million here to hit the guidance. So it looks reasonably comfortable.

The second question linked to free cash flow, specifically on Interiors, easy to forget, but it's had a very strong first half on cash generation also. How should we think about the second half cash generation there? Obviously, that still benefits the group on a de-gearing basis? And then my final -- third question for Martin, just on the China order book as discussed there, 17%, obviously, a very nice number. I think some of your competitors talking more about mid-20s on the order bank with China or Chinese OEMs. So what's the internal target of where you'd like that book-to-bill or order bank as a percent of sales to get to? And then just for the sake of comparison, are you using the S&P estimates for the nameplate volumes when calculating those order banks?

Olivier, go ahead.

So let me start with the first question related to the cash flow. So the EUR 150 million is related to those 2 items. And let's be clear, they are one-off. They are not repeatable, but it's important in terms of the sequence because compared to usual seasonality of cash flow, this is something that you have to capture. The second point is that I confirm that the guidance is including those items. And let me remind that the guidance is a minimum of 3% of sales. So clearly, this is the minimum and the idea is really to be well inside.

Related to other moving parts, the working capital should be the seasonality working capital, H1, H2 should be fairly similar to last year. So we have more working capital contribution normally in the second half. That should be the case as well. But clearly, yes, investment will be higher in the second half related to, in fact, the EUR 90 million of the EUR 150 million that is related to CapEx, but also the seasonal aspect. So we are in a good trajectory, a good trend. And I would say the recurring trend inside is quite positive on the cash flow generation.

Related specifically to Interior, so because of the IFRS 5 rules, operating metrics are not including interior already. This is true also for the net cash flow. But of course, the cash flow of interior contribute to the debt reduction and the improvement of the financials of the company until closing. I would say that we expect the second half to be lower than the first half, which was particularly strong. It's also reflecting that we will finish, in fact, the closing within Q4. So you can consider some contribution, but not to the same extent as in H1.

All right. Thank you. And Ross, talking about the China order book. I think it's important to always look at order intake over an extended time frame. So you refer to the numbers, H1 and maybe market numbers you have just caught up. I just did the math in parallel. So when you look back to 2025, we were also in that mid-20% range with Chinese OEMs making a good part of the orders. So going forward, strategically for us, China remains key. We are definitely going after the business over there. And remember, what is really important for us is the diversification of customers that we have been driving and continue to drive for the rest of the year. So that mid-20% range is certainly a good indicator of where we have been and what should be a good share.

Then you asked also how about the calculation of the orders? What volumes do we assume? So S&P is always a baseline for us. But when we calculate the orders, there is many more inputs because we have to really look into the vehicle lines. We have to look into the equipment rates of some of the features and products we provide. And typically, we also have customer information and weigh that with our own understanding of the market. So our intention is to be as most realistic as we can somewhat be when we calculate these estimates.

The next question comes from the line of Thomas Besson from Kepler Cheuvreux.

I have a few questions as well. And I'd like to follow up on your answer, Martin, on the -- how realistic you can be assessing your order intake. It's more of a philosophical question on how you can do that and notably on the European footprint. Can you share with us your degree of optimism about the ability of Germany and France to eventually agree on something concrete on European local content that would allow you not to have to repeat what you just did in terms of adjusting your European footprint? And can you also share with us your degree of optimism on the USMCA renegotiations and the degree of U.S. content? That's the first question.

Thomas, let me get started on the EU footprint and maybe I have to ask back on the order intake. I'm not quite sure I captured the question completely. But let's talk about EU footprint and local content. I mean you know our philosophy, right? We like local for local in order to just take risk out of the supply chain. And in that sense, we applaud what's happening right now as a proposal to the Industrial Accelerator Act because it encourages that. At the same time, it's a big political discussion, and we'll see how the different instances of the European community are going to decide.

What we are highly in favor of is what was in the initial draft, namely that 70% of the vehicle components would be localized in Europe. And I think your question really targets what, if not as much. Well, first of all, then we will have to react as FORVIA. And if we figure out that our products are at a better cost available from China or other countries in the world, we're not going to forgo sales, right? We will be delivering product from those regions. And yes, then in this case, we would have to look what is restructuring implications. All over, the discussion at this point in time is still too weak to anticipate what's happening. We are getting prepared though. And you can imagine with the various diversification streams that we investigate, our announcement into defense, the sale of an Augsburg facility to General Dynamics from the U.S., you can see how we get prepared for eventual outcomes.

And USMCA, I mean, it is an annual process, right, of reviewing between the 3 countries. I would say, so far, so good. What we say is if USMCA stays in shape with a couple of changed percentages of local content and possibly the U.S. role, we'll get that accomplished in our footprints as well. So as we speak, we negotiate new contracts with the customers, and that comes always also with a look at the footprint. And there is U.S. facilities in the make that we are going to extend or even create in order to be in the right footprint for USMCA and what's coming.

And I would like to ask you, let's go back to your order intake question that I fully get the essence of it.

No, my point is just that it's very difficult for anyone to gauge where vehicles are going to be built and in 5 years' time. So building an order intake, I think it is quite complicated because we are not sure exactly who's going to make it. That's all I meant. If that's okay, I'm going to move to my next question, which is to discuss Clean Mobility. I mean, remarkable performance, I thought in this release. Could you talk about the regional performance in H1? Is it a key driver for the improved NAFTA margins? Has it also managed to improve again in China? And what do you expect for H2 and 2027 in Clean Mobility?

Yes. No, Clean Mobility overall had a very strong run. and it goes back to really the management approach taken into the business. Because originally, we have to assume that capacities are going to be stable at best and that volumes over time, in particular, in China and Europe will go down. And the team has taken a very strict approach around the globe to say, let's anticipate that. Let's adjust even preadjust our structures such that we can stay at profitability, even increase profitability. So there's real and hard work behind it.

How do I see it go forward? It's a very strong year of order intake for the Clean Mobility business as well. And we have secured significant business in North America, quite some conquest business thereof as well. And we will see with, again, the typical lead times of 1.5 to 2 years in that region to SOP, how that is going to support sales and profitability in the North American region in particular.

Great. My next question is about the time line and the share of outflow we should expect in '26 from the EUR 150 million one-off charge related to the disposal you mentioned. Can you just remind us and I assume it has 0 impact on the plan to effectively have with this included EUR 1 billion plus net debt reduction from the transaction.

The line is not perfect. So Thomas, I will repeat my understanding of the question just to be sure.

Sorry, about that.

No, no, it's -- no problem. You were asking whether the EUR 150 million charge I'm mentioning is part or not of the EUR 1 billion cash proceeds from the entire transaction?

I'm asking when is the EUR 150 million outflow planning for Q4 or '27? And does it affect the EUR 1 billion net debt reduction is included or not?

Okay. So the EUR 150 million mentioned is inside the P&L, which is related, in fact, one to this recycling of ForEx inside the equity back to P&L. So it has no cash impact actually. And there is also the other part is related to the tax on capital gain in certain countries at closing. All those items are, in fact, already integrated in the EUR 1 billion net debt reduction that we are mentioning and in the EUR 1.4 billion gross debt reduction that we are mentioning. So it has been already captured in the impact of the transaction, no change there and absolutely no impact on the benefit of the transaction.

I'd just like to squeeze in a rapid modeling question for you as well, Olivier. Can you give us an idea of the net interest and tax charges in H2? I understand the net interest charge goes down because of what you've done in terms of deleveraging and reimbursement of lines. But the tax charge you said would be substantially higher. Can you give us an idea of the magnitude, please?

So related to financial interest, so you see that we have some reduction. We should have something as well in the second half. Now the big evolution in terms of financial cost is related to the transaction of Interior, for which the proceed is end of the year, so the benefit is more next year. Related to tax, inside the EUR 150 million that I mentioned in one-off cash outflow in the second half, you have EUR 50 million, EUR 60 million that are related to tax, which is what you have. And after you have more seasonality of some items withholding tax and others. But the main evolution on tax is from a cash perspective, and I guess this is what you are focused on is the EUR 50 million, EUR 60 million of tax litigations from the past.

We now have a question from the line of Stephen Reitman from Bernstein.

I have 2 questions, please, kind of like related really. On one hand, we had BMW's new CEO, Milan Nedeljkovic, saying that BMW has to work more closely with the suppliers to take account of the massive improvements the suppliers have done in terms of standardization, in terms of -- in order to reduce BMW's own costs as well. What would you comment about what FORVIA can offer in that respect?

My second question really is about yesterday's announcement from Xiaomi about the pricing of their new SkyNomad vehicles, which again seems to be almost the case of economic nihilism pricing these vehicles at RMB 300,000 when the competitor vehicles from the Chinese brands are at the RMB 150,000 level. What do you think is really happening in the China market? And how difficult does that make for you to compete when you're seeing these kind of price downs that are still going through despite the efforts of the Chinese government to put more rationale into the market. And obviously, we've seen what's happened witih good BYD for yourselves.

Stephen, 2 very good and relevant questions in terms of strategy for us. The engagement with our customers, and you quoted some of them, is a very direct, very intimate one. So when I think what makes the difference in the FORVIA approach, it's the proactiveness that we have traditionally brought to the party. And we are very glad that some OEMs now express exactly that proximity we want. And you can imagine that as starting really from a good solid technology exchange. So it cannot be transactional that we receive a request for quotation and then respond. Our work with the customer starts much earlier when vehicle concepts are being firmed up. That's when we can try through our technology.

And by the way, this has been something that drove us into China and into being successful in China that we have very high-level discussions with the customers, what is needed? What do we anticipate? What do we envision for the next line of vehicles. So that early work starts. It never stops. So then you get into the development, sure, changes occur. We got to be very fast in accommodating those. But also for our products in production, we are with customers to say, how can we upgrade features, how can we drive cost further down in order to keep vehicles attractive. And again, it's that intimacy, it's the proximity. It's the service, right, and the investment that we afford into these relationships that will make us prevail. And we are very happy that more and more customers come to the understanding we got it truly collaborate. It cannot be transactional.

And the second question, how to keep competing in the Chinese market. Well, quite a few of these recipes apply also to China and keep applying. And we cannot be any complacent in China. So what we see happening within FORVIA is that more and more activity that is to differentiate us in China is driven by our Chinese teams. And that's across the board. That's for FORVIA, it's for HELLA, where we put more and more effort, more and more teams in front of the customers to be fast enough to feel the wind, right, to have the face in the wind to have the expectations clear and then work locally into the supply chains that we can stay up to competition in China. And so far, so good. You see the order intake. You see the margin that we sustain. So we keep pushing that direction.

We now have a question from the line of Stephen Benhamou from Bank of America.

Congrats for the results. I have 2 questions. The first one is on accounting. Actually, I was wondering if the exercise of the purchase option in Mexico has an impact on operating lease? And if so, what should we expect for H2 and going forward? And the second one is regarding your adjacent opportunities in defense. Can you please educate us on what's the type of drone that you're assembling? Is there any indication in terms of price range? What do you expect in terms of normative margins? And another follow-up question is when do you expect to reach your target of 1,000 drones assembled per month, as you mentioned in your press release a few days ago?

Good. Olivier, I'll let you start with the accounting question.

Yes. So you are perfectly right. This is -- we are exercising the purchase option on an existing site for us, which currently we are leasing, which means that we will have a reduction of the leasing commitment of EUR 30 million to EUR 40 million in the second half. At the same time, we are buying the site.

Good. And let's talk about the defense diversification then. So the type of that first drone we are going to manufacture is an air defense drone, an interceptor drone that goes up to fight incoming drone attacks. The margins and the price points is certainly something I have to treat in a confidential manner. But as a general margin statement, I think it's fair to say that the defense OEMs value the contributions of their local supply base in Europe, and that's also expressed in margins. We expect to leverage that local-to-local setup here in Europe. When are we going to reach 1,000 drones per month? We are now building the first 500. We are going to learn from that. The contract anticipates us to get to that rate sometime in the first half of next year.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to for the web questions.

Thank you, operator. Good morning, everyone. So let's start with the first question, question by Peter [ Rothen ]. So about order intake. We have plus 15% in H1 2026, and you expect to sustain the strong momentum. Does that indicate that a 2026 intake level of some EUR 27 billion? Can you help understand how this is calibrated with the CMD target, which was EUR 21 billion, EUR 22 billion?

Peter, let me shed some light on that. So yes, plus 15% in H1, EUR 13.4 billion roundabout. I see you did the math and say, can we assume that should end up at EUR 27 billion for the year. Our intention is to keep the momentum and keep the gradient. However, in the end, one big deal more or less in the year can make a difference. So we always rely a bit on the timing of our customer awards as well. Directionally, we want to keep that strong momentum.

And can you help understand how that relates to the CMD sales? Well, in average, what we acquire now is going to show up on the streets with SOPs in 2028. And then typically, volumes ramp up thereafter. So you can see how we now already fuel the growth phase that we have set to start in 2028. So we stick with the guidance we have given to 2028, but we need that momentum to build to get FORVIA really on the growth ramp 2028 and beyond.

Thank you, Martin. We have a second question from Peter. So can you share with us moving parts of the margin guidance for H2 2026, given that, first, Lighting should benefit from restructuring initiatives. Second, we should have cost benefits from EU FORWARD and SIMPLIFY. Third, there is a normal seasonality and country mix. And four, inflation headwinds is mitigated. So should margin guidance be seen as cautious and cautious due to China situation and Middle East? Please elaborate on this.

Yes, Peter, first, thanks for that perfect bridge on what all the different impacts are really into the full year guidance. Maybe before you go a bit deeper, Olivier contemplate, we have a range of 6% to 6.5% in our profitability guidance. We have the first half finished at 6%. So I think this is a band that we can fill, and we work really diligently on approaching that band.

So maybe just to take the different element to mention, Lighting, we expect that, in fact, the profitability is bottoming up at H1 '26. You should see some improvement in the second half. Let's see the magnitude. On cost benefit to EU FORWARD and SIMPLIFY, we mentioned before, and we expect, in fact, same range of benefit H1, H2. I just want to mention one point on the seasonality. I think the -- we had in the past, in fact, seasonality related to inflation or other measures that are not exactly to the same magnitude because now we are, in fact, recovering it, I would say, faster. So seasonality H1, H2 on this item is probably less. And after we have a range of guidance for reason given the volatility that exists out there. And this is -- and to have, in fact, the first half already within the range is encouraging. Let's see the evolution for the year.

Thank you, Olivier. I think that ends the Q&A session, which was really rich. So thank you, everyone, for participating. And I will now hand over to Martin Fischer for a few words of conclusion.

Yes. Then let's wrap up. First of all, I very much appreciate that high level of interest in our current business and the outlook. So for me, there are 3 key takeaways from the first half. So we continue to deliver operational performance and cash generation that allows us the deleveraging to be on plan. We're accelerating the commercial momentum. So both in our traditional automotive business and in adjacent markets, order intake is strong. And last but not least, we further transform our culture. And that for me is the true enabler of performance.

So thank you very much again, and I look forward to continuing our dialogue and our engagement through the second half of the year. Thank you very much.

Thank you.

Ladies and gentlemen, dear shareholders, I'm delighted to welcome you to FORVIA's combined Annual General Meeting. For those of you who do not know me, I'm Michel de Rosen, I'm Chairman of the Board of Directors of FORVIA. And joining me today are Martin Fischer, who is Chief Executive Officer; Olivier Durand, the Chief Financial Officer; and Jill Greene, who's General Counsel and Company Secretary. Thank you for coming today. I'd like to thank the many shareholders who have already cast their votes by post. And indeed, those following the meeting online. As you know, this meeting is being streamed live on our website. It's being recorded and will be made available to you. I should also like to thank the members of the Board of Directors who are here with us, in the room or who are following this meeting online. And finally, I'd like to thank everyone who's helped organize this Annual General Meeting and to ensure it runs smoothly and professionally. FORVIA's AGM is a key opportunity to provide information and engage with our shareholders on issues critical to the group, your group.

In 2025, despite turbulence and uncertainty, FORVIA delivered a strong performance in terms of sustainability, innovation and indeed commercial momentum while continuing to prepare for the future. As you know, the FORVIA share price nevertheless remained unsatisfactory in 2025 at a level that does not reflect the company's potential. And although share price has risen, it still remains well below our ambitions. With IGNITE, the new strategy unveiled at our Capital Markets Day on 24th February 2026 and which Martin Fischer will present to you in detail at this AGM, we have a framework to enhance our collective performance.

IGNITE charts a 2-stage course, combining accelerated execution, discipline and short-term financial strengthening in the short term with a clear ambition for growth in leadership post 2028. The finalization of the proposed sale of our Interiors business to the Apollo Investment Fund will be, of course, a key milestone in implementing this strategy. Having joined the company in 2024 and being appointed Chief Executive Officer in March 2025. Martin Fischer is an outstanding leader who brings fresh energy, a new perspective and a management culture that emphasizes performance, delegation and accountability. In a world where uncertainty has become the norm, his motto dare do deliver -- it doesn't sound quite as good in French because in English, you have 3Ds in French [Foreign Language] doesn't sound quite as nice. Anyway. His motto supports the simplification, the transformation of the group and indeed, the cultural renewal very much needed to strengthen our agility and competitiveness.

The Board of Directors is, of course, fully committed to this momentum driven by Martin Fischer and changes in the membership reflect this. And I would therefore like to welcome Pierre-André de Chalendar, who joined the Board as a Non-Executive Director in September 2025 and Lutz Meschke as a Director in January 2026. Their recognized experience feeds into our long-term vision. It enriches the Board's wisdom. It indeed, it enhances our own ability to manage complexity. I have had the honor of chairing this group for 10 years. And as my term as Chairman of the Board, of directors comes to an end today. I'd like to express my deep gratitude to the Board of Directors, but also to Martin Fischer and indeed to all our teams and also to you, our shareholders, and to our suppliers and customers who inspire us every day to aim even higher.

The FORVIA I'm about to leave will be certainly different from the one I joined back in 2016. It's more tech-focused. It is active in electronics and lighting. It's stronger in Asia and it's got enhanced capabilities in research, development and innovation. FORVIA is now firmly committed to the fight against climate change and is treating diversity as a key strategic driver. And yet over the past 10 years, some features of FORVIA have remained unchanged. our fighting spirit, courage, ability to change, to transform, quality, special focus on customers, but indeed a deep ambition to build something together that transcends us.

Now if you give your approval today, well, then Pierre-André de Chalendar will become a director and then will be Chairman of the Board of FORVIA. I know him well. I've known him 40 years. He's a great industrialist. He's both experienced, talented and attentive. These are rare qualities. So together with the Board of Directors and Martin Fischer, he will certainly lead our group to success. Now to conclude this introduction, I'd like to thank you, shareholders, for your trust, for your patience and indeed for believing in our vision of FORVIA's long-term value.

Now I'll turn now to the executives in the room. I'd like to welcome the members of the Board who will be speaking alongside me. You have Denis Mercier, who is on the front row. He chairs the Compensation Committee and Jean-Bernard Levy also on the front row, who chairs the Governance Appointments and Sustainable Development Committee. Each of them will present a report on the key issues addressed by their respective committees. And we also have -- well, quite obviously, Pierre-André de Chalendar, whose appointment as a director is, as I mentioned earlier, subject to a vote by this meeting. So it's subject to your vote. I'd also like to welcome Esther Gaide, who chairs the Audit Committee; Valérie Landon, who is a member of the Audit Committee. We thought that Robert Peugeot would be with us, but no, it would be Thierry Peugeot. Thierry Peugeot as a long-term Director of FORVIA and [ Liquide ]. His name is enough legitimacy for him to be with us. And Emmanuel Pioche, he is an employee directors that I'm sure he could make it today.

In any event, this combined general meeting of Shareholders is convened on first call. The statutory notices regarding the convening of the meeting were published within the statutory time limits. The financial statements, reports and all documents required to be made available to shareholders have been made available in accordance with applicable legal and regulatory provisions in these documents, I'm not going to read them out. The documents then are located on the table on my right, right there. There's a green binder there right at the front of the room, and it's out there if anybody wants to look at them.

And now we shall now form the bureau, verify the quorum and indeed go through the agenda -- the meeting. I know that amongst the shareholders either present or represented, we have, well, société Peugeot, the company Peugeot 1810, represented by Guillaume Falguière, who is here on the front row. And the investment fund represented by [indiscernible] also on the front row. Société Peugeot 1810 and the Foncière fund are the shareholders with a high number of votes, and I just checked, they've agreed to take on this role. So they have been appointed as vote takers as scrutineers for this meeting, and I'd like to thank them.

Also [indiscernible] and Stefan van Dalen who's there. Their judicial offices, and they are attending this AGM at our own request to certify its proceedings. So I would like to thank you both for your assistance. And finally, I suggest that Jill Greene should act as Secretary for the meeting. I'd like to thank her in keeping with relevant provisions, it is for me to chair this AGM in my capacity as Chairman of the Board. Directors, I'd like to remind you that in -- for ordinary resolutions, the meeting may deliberate only if 1/5 of the shares carrying voting rights are present and for the extraordinary parties, 1/4 of the shares carrying voting rights being represented or being present.

FORVIA's share capital includes 197,089,340 shares. The number of shares you have to remove the treasury shares held by FORVIA. So it's 1.21 million. And so you get the actual number needed for the quorum. The number of shares held by shareholders present, represented or having voted by post or indeed online or having given a proxy is 123, 137,826. And so that is 62.87% of all shares carrying voting rights. That is a percentage a lot higher than the 20% and 25% quorums required for the validity of the resolutions of the ordinary and extraordinary part of the AGM convened on, I recall, first call. So having reached that quorum, the meeting may vote in full legitimacy. And I'd like to point out that when the meeting acts under the term of the ordinary AGM, resolutions are adopted by a simple majority and for the extraordinary part, the resolutions must be adopted by a 2/3 majority. Finally, I would like to remind you that this meeting is called upon to address the items on the agenda, which was passed on, which was included in the notice of meeting brochure made available to you prior, of course, to this meeting.

No amendments were made to this agenda. And so therefore, I propose not to read it out in full. And so therefore, I declare this meeting open -- it was a rather lengthy introduction, but that's the way you're supposed to do things to be in line with regulations. In any case, the agenda will include the following items: IGNITE, our strategic road map by Martin Fischer, the 2025 financial results and 2026 outlook by Olivier Durand, governance and sustainable development by Jean-Bernard Levy, compensation of corporate officers by Denis Mercier, the report of statutory auditors on FORVIA's financial statements and CSRD, the Q&A session, of course, and finally, the vote on Martin Fischer's presentations will be partly in French and partly in English.

And so for anybody needing this, of course, you may wish to wear headsets to follow the translation. I'll call on Martin Fischer to introduce the first topic entitled IGNITE our strategic road map. Martin?

Thank you, Michel. Dear shareholders, member of the Board. First of all, I'd like to warmly thank Michel and the entire Board of Directors for the trust they have placed in me throughout my first year in office. I'd like to thank Michel for his support, his availability, his wise advice. It's a real honor and pleasure for me to work with him. Arriving at FORVIA, I became convinced of the need to rally the entire organization around 3 strategic priorities: performance, transformation, and culture. The year 2025 proved to be a real test, many challenges. But our performance in 2025 demonstrated our ability to make headway in a particularly complex and demanding environment, thus confirming the validity of our strategy. These results reflect a tangible financial success. Olivier Durand will come to that in a moment.

Moreover, 2025 also marked the beginning of a structuring transformation of our model and a sustainable renewal of our culture. In a matter of 1 year, we managed to achieve major change with the collective energy, the spirit of initiative and indeed the constant commitment of the FORVIA teams, and I'd like to thank them wholeheartedly. Based on this sound foundation, we opened a new chapter in early 2026 with the launch of the IGNITE strategic plan that was announced at our Capital Markets Day on 24th February. Now this plan proposes to generate sustainable growth and indeed a dependable financial performance, accelerating as of 2028, with a clear priorities and a solid foundation, FORVIA now can focus on what matters most and achieve its full potential. In other words, becoming a global technology company, a lead company serving its customers driven by a culture of commitment and accountability.

Let's take a look at the -- at FORVIA's ambition, and I'll switch to English. And then I'll give the floor to Olivier Durand for the financial section. And finally, I'll share with you the major lines of action of our strategic road map, IGNITE. And now I call on Jill Greene to give -- say a few words about the next presentations.

So this legal notice, I'll do in English. As you are all well aware, we have announced previously this year the divestiture of the Interiors business, which includes a major scope change and requires the application of IFRS 5 accounting treatment in the financial statements. The business has respectively retrospectively been classified as discontinued operations. And therefore, today, all of the 2025 figures shall be presented before IFRS 5 application unless we state otherwise in the slides. And all financial objectives from 2026 onwards will be presented under the IFRS 5 application. With regard to our universal registration document, please note that the figures are presented both with and without the application of IFRS 5. With that, legal is out of the way. Martin, please continue.

Thank you, Jill. So let's review the past year, and this year has certainly challenged our industry with quite some uncertainty. I'm very proud to say FORVIA in these circumstances has proven our ability to absorb shocks, to stay a demanding course and to continue to deliver. And reflecting on that year, I have to say the enablers for that have been very disciplined management, strong execution skills and solid innovation in the back. So that momentum is now anchored in our strategy, IGNITE, which we have presented over the Capital Markets Day on February 24.

So IGNITE provides a clear and a very structured road map, and it's designed to sustain performance and unlock long-term value for FORVIA and you, our shareholders. Let's have a look at the following video.

[Presentation]

So as you can see, we have a clear ambition to shape the company as a leading and future-ready player. And our vision has 3 pillars to stand on. And that's a tech-driven company. We are driving through strong innovation capabilities. We have developed a true global reach being close to all markets and all of our customers. And then we have a high-performance culture in place that is driven by empowerment and accountability. It is a major enterprise with our EUR 26 billion in automotive sales last year, and we are very well distributed over the globe with a presence not only in our home turf, Europe, but with more than 50% of our sales coming out of the Americas and out of Asia.

When we look at the shareholder structure, it reflects on the group's recent history. So following the spin-off from PSA and Stellantis in 2021 and then the HELLA integration in 2022, Exor and Peugeot 1810 hold approximately 5% and 3% of our shares. And then the Hueck family holds about 90% of our capital. Also here in France, we have the CDC Group representing 5%, thereof 2% being in the ownership of Bpifrance. The remaining 76% of our shares are free float, owned to 10% by retail shareholders and 66% institutional shareholders. Within the 66%, we have 10% based in France again.

So the group is going to change phase. Michel referred to that. So I'm happy to report that end of April, we have signed an agreement to sell our Interiors business to Apollo. The deal is signed at expected terms in a challenging environment. So the enterprise value comes to EUR 1.82 billion, and this will allow us to reduce our net debt by at least EUR 1 billion upon closing. More financial details will come from Olivier. So this project, in fact, represents a key milestone in the execution of our FORVIA IGNITE strategy because it will enable FORVIA to focus on high value-added and technology-driven activities. And as I mentioned, at the same time, it's strengthening our financial structure.

From where we stand, the project is now subject to works council consultations and the customary regulatory approvals. This project truly reflects on the strength and the leadership of FORVIA Interiors as well as the expertise and the commitment of its teams. And I would like to express my deep appreciation for the work that the Interiors team has done in the last year, running the daily business and at the same time, preparing for the divestment project. Apollo coming in as a dedicated owner of Interiors will take this business forward into a prosperous future.

So now let's dive into IGNITE. It's our medium-term strategy ambition. We drive what matters today, and we unlock what's next. So it's a sequenced road map for long-term value creation. We refer to 2025 as our year 0 because the results we could attain make that ambition of IGNITE's incredible. IGNITE is a sequence road map in 2 parts. So the Phase #1, 2025 through 2028, it's all about discipline and focus. We want to streamline our portfolio, focus on execution, deliver profit and cash and thereby deleverage, improve our balance sheet. First proof points have been through our initiatives such as EU Forward, Simplify, you have recognized our new investment discipline. And finally, the divestiture from the Interiors business.

So by 2028, we will have a very solid foundation accomplished with a healthy portfolio and a solid balance sheet. And that opens up the way into Phase 2, where we want to lead and grow. We want to grow much faster and the result will be a stronger, more focused and more competitive FORVIA. So I'm very pleased this morning to report out on progress from year 0 on all of our 3 strategic priorities. Remember, it's performance, it's transformation and it's culture. So on the performance side, we delivered much better margins, 40 basis points up from 2024. And also, we improved our net cash flow by plus 50%, all that being delivered at a better quality. On the business transformation side, good amount of focus went into structuring the portfolio. And again, the divestiture of Interiors is one of the proof points where we want to go with the company.

Those clear portfolio decisions, on the other hand, led to impairments and a net loss of EUR 2.1 billion reported in our prior event. We certainly do not take that any lightly. But at this point, I want to also clearly mention that this loss is in the interest of the future portfolio, and it is not cash relevant. Third pillar, our invigorating culture. Our operating model is changing. We are refreshing and simplifying our organization in order to become more agile. We will be more to the point of views, we are going to be closer to the markets and improve and accelerate our decision-making. So Olivier is going to complete that chapter here with more details on the 2025 results in just a little bit.

Now let's go into the 3 pillars of IGNITE and transformation is certainly the key pillar because here, it's about strategic clarity and our portfolio choices. We want to play in attractive market segments that grow, and we want to play in those segments where we also have a strong right to win. So let's look at the entire portfolio first. The industry has really been reshaped by quite a few powerful shifts. You see them on top of the slides. Clean mobility basically coming in the form of electrification at different speeds in different regions. We have connectivity as consumers, as drivers, as passengers, we want to be always on in a seamless way. The software-defined vehicle truly changes the architecture electrically for a car. It's being simplified. But at the same time, it offers new features in the form of software that can be updated at all times along the vehicle life cycle.

And then the trend that's really moving safety and comfort is certainly coming from automated and autonomous vehicles. FORVIA has built a portfolio that very well caters to all these trends. So we are strongly positioned to benefit from the respective growth of these trends. More than that, we are not only following the trends, but with our technology, we are shaping these trends. And here, I want to give you a couple of examples from the past year of what innovation means at FORVIA. These are products where we either acquired first businesses with customers or brought them to series production in 2025. Let's talk about the software-defined vehicle, and we'll go deeper into that technology since again, it really constitutes a significant change of vehicles in their architecture. Here, we have attained new businesses from numerous customers to deliver zonal modules. And you'll see a little later, we are really proud of that technology where we start from chip design, go into hardware integration and deliver the software for those zonal modules.

Second example, our 3D Zen mechanical massage seat, an idea where the massage and therefore, the comfort gets a little bit more intense, a little bit more tangible than in what you might know from conventional massage seats. From invention and the first demonstration in China to industrialization and start of production, it took only 12 months. So it's not only a great technology feature, it's also a proof point that we move at the speed of the world right now. Third one, FlatLight technology for signal lights. Here, we have a new technology that reduces energy consumption by 40%, weight by 80% and gets really small in packaging. So that's a real breakthrough in terms of tail lights where you need these kind of signal lightings also in headlamps.

And the fourth example comes from the field of clean mobility. The trend of hybrids and range extenders as propulsion sources requires smaller packages for our exhaust systems, and that's what we have developed and delivered to customers together with new functionality to reduce noise and vibration in these cars that are expected to be rather silent because most of the time, they drive electrically. You don't want to be disturbed by a combustion engine coming up. So here are 4 completely different fields where you develop a sense on how we lead through technology.

So now let's pull out and let's look at our product portfolio in a broader way. Under IGNITE, we have split the portfolio in 2 clusters, the growth cluster and the value cluster. These clusters take different roles in our strategy and value creation. So in the growth field, we have Electronics and Seating. And again, these are markets that grow in an attractive manner, and we have a strong right to win. That's why Electronics and Seating ended up there. Priorities are innovation, technology, a very diversified customer base and last not least, the growth that you would expect in a growth cluster. So here, we are ready to invest in a disciplined manner.

On the other hand, you see the value cluster with Clean Mobility, Life Cycle Solutions, Lighting and Clarion. This cluster is equally important, but with a different role. So here, the focus goes on performance and value generation. Also, we have strategic flexibility for possible further divestment from that value cluster. So this clarity and focus enables us to allocate our resources, our CapEx in a good manner to enjoy best profitable growth from FORVIA. And it goes without saying the various clusters have also different requirements in management.

So now I would like to go through our different business groups and start with the business groups in the growth cluster. Let's talk electronics first. We enjoy top 3 positions already in body electronics, energy management, components and radar. And you see that as we speak, we enjoy growth rates of 10% per year, and we intend to further increase the growth beyond 2028. That's why we are doubling down in certain technologies such as zonal modules, and we are going to get to the detail of that. Battery and power electronics, basically driven by the electrification of vehicles and in-cabin electronics, a safety and comfort feature.

So now let's dig deep into zonal architectures, and we want to show what differentiates FORVIA in that very attractive space.

[Presentation]

So this product range clearly identifies the competencies and the capabilities of our teams that help to differentiate. Let's move into the second growth cluster member, and that's the Seating business. We are enjoying growth here as well from 2025 to 2028 of about 2% per year and want to drive that up to 4% beyond 2028. So that has to do with a steady growth of our passenger car business, but then also about tapping into new revenue pools. So first of all, there is good growth in the content of seats. So the market requires additional comfort features, additional safety in the seats, wellness features and also making seats more sustainable drives value and content in those.

We certainly play from a good strength in China with our Seating business. We are now moving into the broader Asia to expand our customer, such as in India and with the Japanese customers. Another field of expansion is the extension from passenger car into commercial vehicle applications. That is a relatively new space for us where we got a good foothold for growth. And last but not least, we look also for strategic partnerships in that range that can act as a growth driver. So 2 strong fields in Electronics and Seating driving the growth.

Now let's get to the value cluster. Lighting and Clarion are clearly here to unlock operational upside. So we are the undisputed tech leader in lighting and have a full offer of product range for our customers globally. At the same time, in the past, we focus very much on premium business. We are now at a point in life that we want to extend that and also cover the volume market segment. This comes with clear cost focus and investment discipline that we need for FORVIA HELLA Lighting. Clarion, our business for cockpit electronics, is also working on its competitiveness. It is with plenty of software involved in R&D-intense business, and we are rationalizing that R&D spend and also here go for partnerships in order to share the burden in order to bring product to the road.

So in summary, we want to transform both businesses with focus on performance, profit and cash. The next 2 businesses are Clean Mobility and Life Cycle Solutions, and they are clearly focused and delivering on cash generation. So Clean Mobility is the world market leader with about EUR 4 billion of sales. And we have a bit of renaissance going for that business due to the continued life of the internal combustion engines and also the need of exhaust systems for hybrid applications. So the goal is here, we keep loading our global capacities by gaining market share in a market that elsewise is declining due to still a reduction of combustion engines. So here, we enjoy double-digit margins and a very strong cash generation.

Last but not least, Life Cycle Solutions. It's a EUR 1 billion business where we strongly leverage the HELLA brand, and we have very good synergies to enjoy between our original equipment business, our workshop diagnostics and the aftermarket sales channels. So we enjoy resilient margins and a robust cash flow out of this business. So again, both of these businesses stand for cash generation and balance sheet strength. So we are talking a lot about growth. And for all of our businesses in the growth and the value cluster, there are dimensions that we want to further explore and exploit.

First of all, we have a strong foothold in China. The last year was outstanding with a new order intake of EUR 8 billion just in China, thereof 80% with the domestic Chinese OEMs. So that is a place to expand further, and we are now completing our customer portfolio with new coming and incoming customers in China. Furthermore, we can also join the Chinese customers on their global endeavors. So them investing in Europe, in the Americas. We are a trusted partner of choice. So we supply our Chinese customers also globally.

When we look into Japanese and Korean OEMs, also here, we strive for a stronger representation, and that's happening on the base of a very strong innovative product portfolio and our global footprint. So our success in China these days makes us attractive also for the Japanese and Korean customers. So we carry that strength over. Third pillar, India. It's the strongest market growth right now, and we expect around about 7.5 million light passenger car vehicles in 2030 in India. The good news is as FORVIA, we are strongly present there. So right now, we enjoy sales of EUR 450 million. But what's more impressive is that we have 6,000 people on the ground, thereof about 2,500 engineers. So here, the focus is very clear. We want our competencies, our people now work on the new local market demands to double that business in India by the end of the decade.

And the last field to mention our commercial vehicles. It's a very attractive marketplace, driven by regulation and innovation and long life spans. And also here, we are not yet fully represented as FORVIA. So now various business groups have been successfully acquiring first businesses with commercial vehicle customers. We have a dedicated organization in place. We have specific product lines. And also here, we want to double sales by 2030. All that future orientation, all that transformation depends every single day on our performance. Here's a couple of things. You saw the results, a couple of ingredients and levers that I want to share with you this morning. We can rely on a very unique operating system, which is the FORVIA Excellence Systems. It gives us a very strong base built on safety, on customer focus and sustainability. You see a couple of results here from the last 2 years, in fact. So on the safety bar, you see that our accident rate could be reduced by 60% in just 2 years. And that is due to very consistent application of our standards.

On the customer side, quality claims have come down by 1/3 in the last 2 years. Also here, the customers recognize FORVIA as being responsive, transparent and proactive when it comes to driving good quality into our products. And last not least, on the sustainability side, we have exceeded our targets. So the Scope 1 and 2 emissions came down by minus 91% since the reference year 2019, and we could move Scope 3 emissions down by 24% since 2019. So we keep in a very good alignment with our customers to push the right strategy forward. A key enabler these days is certainly coming from digital and AI. Our ambition is clear. We want to connect and integrate our systems and then scale AI to unlock all the value creation possible.

So connectivity is already in good shape with 5,800 connected production lines. So in real time, we get excellently structured and quality data that allows to optimize the processes. We solve problems and quality issues on the fly and drive overall a stronger plant performance. Coming in last year, second pillar here, I realized that our IT landscape was rather scattered. So we launched a project to integrate seamlessly our systems around sales, engineering, purchasing and plants. And that is very important because with that, we get outstanding integrated data at a good quality. And a good data quality is always a prerequisite to successfully apply AI. And here, we are in full swing of a transition. We have started our business transformation studio. That's an executive committee-driven initiative where once a month, we meet. We look at project proposals concerning an AI, assign funding and then drive consequently the implementation of the changes that come through AI. So more and more processes in FORVIA are driven by AI agents and every function can benefit from that additional performance.

Let's move to the third color now, IGNITE culture. We have restored our operating model in the last year, and we have converted into what we call a division-centric operating model. In FORVIA terms, division is the regional unit of a global business group. Think about it as Seating North America. So what we have done last year is that we have allocated clear P&L responsibility to these divisions because they are the closest to the respective marketplaces. Also, we have reduced matrix organization. So wherever we could, we assigned resources directly to the divisions. So no conflict of interest, no siloing all in one hand. Also, we have increased the authority limits. So a division leader has good authority to make fast decisions on CapEx, on new program acquisitions, et cetera. So the full accountability, the full responsibility as well lies within the hands of our division leaders.

Of course, there's good governance from the group level as well, but you understand that level of empowerment. And that's going to make for faster decisions. We are going to be more adaptable to the various needs of various regions and customers, and we generate a much stronger ownership by our teams at the point of use. So this is a key enabler of IGNITE. It is very clear that IGNITE is driven by our employees and through good leadership. And therefore, we have cultivated 3 leadership principles with FORVIA. It's about guide, empower and recognize. So a good leader at FORVIA sets the directions, give the priorities and removes the obstacles for the team. The good leader empowers at the point of impact, giving trust and enables -- the good leader enables to deliver. And in the end, we are always very self-critical. We want to hold accountable. And it's not only about being critical, but also about recognizing in a good, strong positive manner. So we want to share our successes and foster good collaboration, therefore.

So this leadership performance has been measured. So last year already for the top managers, they got a feedback from their teams on how am I doing in guiding, empowering and recognizing. And that impacted the annual performance appraisal of these managers, the top managers at 25% of the appraisal. Now in 2026, we are rolling that out to all the 6,000 managers of FORVIA. So you can imagine what strong of a feedback loop that is to encourage, guide, empower, recognize. So this systematic leadership development is absolutely an innovation driver and a transformation driver.

Now let's have a look into daily life. And it's about people in the end. So I'm very happy to share a bit of lively situations on empowerment, diversity and solidarity. So with IGNITE being in rollout, it's clear we have to communicate a lot. We have to be understood. We have to be supportive. We have to be aligned. And we have set up quite a few communication formats that enable so. So we have general management conferences all over the place. And we have a format for a session called Ask Me Anything where anybody who has a PC in the company can log on and get into direct communication with myself and the senior leaders. So we are, in that sense, a learning organization. And it's also nice to tie that to a number. Every single employee at FORVIA last year had an average of more than 25 hours of training and development.

Second point, diversity. Well, we host people from 140-plus nationalities in 40 countries. And we have also extended and promoted our gender diversity. You see the numbers here on that page. It's important to further strengthen that balance. And finally, a truly proud moment. Early this year, we have introduced the FORVIA Solidarity Day. So that's a strong collective movement to support our communities and charitable organizations. So in the first months of the year, we have engaged thousands of employees across the world through hundreds of initiatives to support their communities. And all that is also financially sponsored by the FORVIA Foundation. So these are very fine moments, and I hope they give you a glimpse on who we are as FORVIA also on the human side. Olivier, with that, I would like to hand over to you for the 2025 financial results and the 2026 financial outlook.

Thank you, Martin. Good morning, dear shareholders. I'll present the financial performance for 2025 and the outlook for 2026. As Martin pointed out, the year 2025 was year 0 of the IGNITE. All the indicators prior to the implementation of IFRS 5, as Jill mentioned at the beginning of this session, all the indicators were in line or indeed above the guidance in terms of revenue. Sales were stood at EUR 27 billion on a constant FX basis. Regarding operating profit margin, we were up 40 basis points to 5.6% of revenue, thanks to reduction of fixed cost and in spite of the context of tariffs in the U.S. we had a significant increase in net cash flow, up 47% to EUR 962 million, but also in qualitative terms because this growth is -- results from better EBITDA and lower CapEx, streamlining of CapEx. As a result, we had an additional decline in net debt to the tune of EUR 600 million. And with that, plus improved EBITDA, we have a -- well, our gearing ratio went from 2.0x to 1.7x.

And then, of course, as Martin pointed out, we had a net loss -- net income of EUR 2.1 billion, but that is because we decided to streamline our portfolio, and these are one-off measures. These are noncash measures, and I'll get back to that in a moment. Regarding sales then, we stood at EUR 26.2 billion last year. And so between '26 -- well, the difference between the published numbers and the actual, we had an FX effect to the tune of 3% of revenue. That's mostly to do with the U.S. dollar, but also the Chinese RMB renminbi. The FX effects have a little effect on profitability because we mostly buy and sell in the same local currencies, China, Europe and North America. Sales were stable in -- on an organic basis, that is without FX. So we had, in fact, a plus 1.5% in products compared to the markets that were up 3.9%. But there was -- in tooling, there was a decline that came back to normal levels, having been abnormally high in 2024.

If you break down by region, we had an online growth in Europe and North America. In China, underperformance because the customer mix was unfavorable with the development of BYD. And there was overperformance, and that is continuing in South America and indeed, in the rest of Asia, that is China, not including China. If you look at this business by business, electronics enjoyed double-digit growth. And so this is a major growth driver for the company. We had a bounce back in Clean Mobility, mostly in North America because of electrification there. But also we returned to growth on Life Cycle Solutions.

Seating suffered from the unfavorable customer mix, mostly in China, and there was a gradual repositioning of Lighting. Regarding operating profit -- operating margin, we were up 40 basis points from 5.2% of revenue to 5.6% in 2025. This is mostly due to our efforts to cut fixed costs. The EU Forward program it was launched in 2024. It went full year in 2025. There were 6,000 departures last year out of the 10,000 initially planned. And so that enabled us to save EUR 165 million. Synergies resulting from the combination between FORVIA and HELLA generated EUR 63 million additional last year and then a strict control over production costs and operating costs, plus a cap on hiring and restriction on travel and discretionary and marketing expenses, plus the overall Simplify G&A cost, all that added to the performance.

Margins were up in all businesses, except for Lighting, Electronics, driven by volume and control over R&D. Seating in spite of lower volumes, Clean Mobility, thanks to efficiency and productivity gains. Lighting suffered from lower volumes, and it started a turnaround program. You'll see the results in the years to come. So by and large, the performance gives a sound foundation, but also indicates the potential for growth in the company, which remains significant.

As mentioned earlier, there's one key factor in the development of the growth, and that is the disposal of the Interiors business. That disposal will strengthen the company in 2 aspects. Number one, to do with streamlining the portfolio, which is much more focused and driven by technology. And the second item, of course, is that the cash flow profile and the financial structure, of course, come out stronger as a result. Looking at the various effects of the disposal, let's take a look at the group's performance in 2025 prior and after this operation in pro forma term. The sales figure was EUR 21.3 billion. The operating margin was 6% because this is, of course, dilutive of the operating profit.

Net debt was down by EUR 1.4 billion, the gross net debt that is net being down upwards of EUR 1 billion as a result of all this. And the gross debt is, of course, gross debt reduction is what enabled us to save on financial expenditure. And you can see starting as of 2027, an additional EUR 50 million to EUR 70 million savings in financial or interest expenses. That transaction is now final and the conditions for closing, the only condition precedent are antitrust provisions, but this -- we do not expect any problem there. And so we expect a finalization by the end of the year.

Now let me just add that all the disposals since the acquisition of HELLA, including this operation added up to EUR 2.3 billion. And so our group will be much more robust after that transaction is completed. Now if I may, I'd like to take a look at the net loss of the company to the tune, as I said, of EUR 2.1 billion. That loss is to do with one-off expenses that are noncash expenses, and that is a result of a -- the necessary transformation and simplification of the company's portfolio. These one-off charges are worth EUR 1.8 billion.

So you have some impairment on Lighting and Electronics on Clarion to the tune of EUR 900 million, EUR 270 million for Lighting and EUR 650 million for Electronics, mostly Clarion. Then a capital loss on the planned divestiture of Interiors to the tune of EUR 578 million. Depreciation on Symbio, this is our joint venture on hydrogen batteries, and that is because our main customer shed some shares. And then there were -- there's a number on deferred tax assets being reassessed. And so that produces also a minus EUR 135 million. So the one-off charges plus the restructuring costs, which, of course, were at the high point in terms of P&L in 2025, plus financial expenditures remaining high, but that have started to decline, and they will keep coming down. We certainly expect that decline to continue after the sale of -- the disposal of Interiors.

So 2025 marked a clear improvement in the group's financial structure. The first item is the leverage ratio down to 1.7x, and that has accelerated compared to previous years compared with 3.1x at the time of HELLA's acquisition. That improvement will continue in 2026. The expectation is to arrive at 1.7x -- 1.5x, I make a pardon, with a net loss of -- the net debt of EUR 4.5 billion with the proceeds of the sale of Interior. So we're dividing both the debt and the leverage in half compared to what we were after the acquisition of HELLA in 2022.

Cash generation and other refinancing operations worth about EUR 3 billion in 2025, of course, improved our debt profile. Because there's no significant payment by -- before 2027, we have a smoothing of maturities between 2027 and 2023, and that means that there's much less risk there. And then there's a broadening of our liquidity pools because we have access to new credit markets, in particular, the access to the American bond market, which is the largest and most flexible in the world. Our purpose for 2026 is to keep improving the fundamentals of the company in IFRS 5 standards. So Interiors being counted as discontinued activities, so below operational indicators.

We -- objectives are revenue sales between EUR 20 billion and EUR 21 billion on a constant FX basis compared with EUR 21.3 billion in 2025. But again, in comparable terms, so applying IFRS 5 standards, operating margin better than last year from ranging between 6.0% and 6.5%. Net cash flow should be at least 3% of sales and the debt to adjusted EBITDA ratio, 1.5x. And that, again, is, of course, an improvement compared to 2025 where it was 1.7x. We also fully confirm this guidance based on sales of EUR 5.1 billion in Q1 alone, and that is very much in line with the trajectory plus additional measures on costs and on resilience plans being rolled out as part of this context of uncertainty due to developments in the Middle East. And by way of conclusion on this financial presentation, let's take a look at the share price and how it was affected by the various steps that we took, the share price was upwards of 35% since 2025.

And that is, of course, a significant overperformance compared to the reference indicator of the automotive business in Europe. But still, that share price is so far cry from reflecting the achievements and indeed the positive trajectory and potential of this company. The bounce back in the share price in 2025 was hampered by, of course, the outbreak of conflict in the Middle East in February, we remain focused on implementing our road map. We believe that the gradual improvement of the group's fundamentals is well underway. With the full implementation of IGNITE, this will be recognized -- should be recognized by the markets. Thank you so very much. I now give the floor back to Martin Fischer.

Thank you, Olivier. Towards the end of Phase 1 of IGNITE, and we project the following numbers there. By 2028, we want to arrive at EUR 21 billion to EUR 22 billion of sales on a much better focused and better scaling portfolio. Operating margin is expected to exceed 7%, net cash flow being about 3.5% and very importantly, the leverage ratio coming down to 1.2x. And that will allow FORVIA to really accelerate growth, look forward into Phase 2 of IGNITE after 2025 -- 2028, excuse me. So how will this translate in terms of capital allocation policy by 2028 and after? So as Olivier described, in the next 3 years, we strengthened our balance sheet further. So we target 1.5x of a leverage ratio in 2026 and 1.2x in 2028. So then looking at 2028 and beyond, our shareholders, you will benefit from a solid financial structure, while the company will be able to finance our sustainable growth opportunities. So we remain committed from there to long-term capital return to you, our shareholders.

So for 2026 payment and 2025 performance, the Board proposes no dividend with clearly having our deleveraging priority in the focus. Looking forward, however, the group remains completely committed to consider dividends and share buyback policies, which will be based on financial results and the financial positioning, both in terms of balance sheet and our leverage ratio. So as a leadership team, we are determined to work towards these forms of capital returns, either in dividends and/or share buybacks.

So let's summarize. IGNITE is a clear step-by-step path to success. We drive what matters now, and we unlock what comes next. Best-in-class performance will show in profit and cash and therefore, also in terms of deleveraging. So we truly reinforce our foundations, and we can grow from a position of strength. Business transformation, we are going to pursue that with discipline and focus. We have established our growth and value clusters, and we drive leadership positions in that with clear capital allocation priorities. And the third point, the third branch, invigorating our culture. We have accountability and empowerment going for the acceleration of the business. We make decisions at the right level with agility, and we drive performance that way. So I am, in summary, highly confident that IGNITE delivers sustainable growth, strong financial results and long-term value generation.

Well, thank you, Martin and Olivier, for these very comprehensive presentations, and that will certainly enable our shareholders better to understand the priorities, the performance of FORVIA. And now I will call on Jean-Bernard Levy, who chairs the Governance Appointments and Sustainable Development Committee to introduce these issues of CSR and governance on which the Board of Directors alongside the committee worked in 2025.

Thank you, Mr. Chairman. Ladies and gentlemen, dear shareholders, on behalf of the Board, it is my role to talk about governance and makeup of the Board and sustainable development. The Board of Directors is a diversified Board, an international one with multiple disciplines and skills, and it's independent. It is made up of 14 directors, 2 of whom represent employees out of 14 directors, there are 5 women, i.e., 42% of the people that we include in these ratios, there are 6 nationalities on the Board, bringing key diversified and complementary skills to the Board of FORVIA. And finally, 83% of directors are independent, nonexecutive.

In 2025, there were 28 meetings of the Board and its committees. This year, we have scheduled, and this is what is -- will be subject to a vote in a few minutes. We are suggesting, as our Chair, Michel de Rosen said, we are suggesting that our shareholders elect Pierre-André de Chalendar represented here as an independent director. After the election, it is suggested that the Board will elect him Chairman. So I will invite Pierre-André de Chalendar to join me on stage to introduce himself a few minutes before you can vote on his appointment. Over to you, Pierre-André.

Thank you, Jean-Bernard. Ladies and gentlemen, dear shareholders, it is with some emotion, and I have to say real pride that I'm standing before you today before if you so decide before becoming a director of this group. And as Jean-Bernard said, you know that the Board of Directors intends if elected, to make me Chairman. For those of you who don't know me, let me introduce myself. I am first and foremost, an industrialist. I've spent most of my professional career, 35 years in the Saint-Gobain Group, where for 14 years, I was CEO and with a certain lag at the same time, I was also Chairman of the Board of Directors. So I've had long-standing industrial experience. And I'm passionate about industry with everything that, that means in terms of rigor and being demanding this industrial -- these industrial roots, if you so decide, I will be happy to harness them for FORVIA.

I would like, first and foremost, to thank the entire Board of Directors, the Chairman, the Chairman of the Nominations Committee for their trust in suggesting me for the role of Director. And thank you also for letting me step into the Board because as a nonvoting director since the month of September, I could become more familiar with FORVIA's activities with its Board of Directors. I could, of course, meet the Chief Executive Officer, Martin and his teams. And these last few months convinced me of how extremely rich and diverse FORVIA's team is, the men and women who make up the company, its businesses and who provide its ambition.

And so I think that I am consequently ready to take on this new role. Here, I wanted to pay especially tribute to Michel de Rosen, who is now leaving the Chair of the Board. After over 10 years at FORVIA, Michel has been supporting all of its transformations and major changes, especially the integration of HELLA, which I think is one of the most transformational changes in the automotive equipment manufacturer landscape in the last few years, and Michel is now leaving a deeply transformed and well-positioned group for the future.

I wanted to express my heartfelt gratitude to him for what he did for FORVIA and also for the way he's been welcoming me in the last few months on behalf of the group, and I wanted to express my utmost respect. What is my mindset when arriving into the company? I wanted to say that I'm enthusiastic. I am convinced today that FORVIA is at a turning point, opening a new page in its history. The IGNITE plan that was presented and approved by the Board of Directors is a clear and ambitious strategic road map, and it's already underway refocusing the portfolio, enhancing profitability, reducing leverage, accelerating in the technologies that will shape tomorrow's mobility. I think that this is a trajectory which is both rigorous and future forward.

I said that over the last few months, I had the opportunity to meet Martin Fischer. I wanted to say that he's an excellent CEO and the captain that FORVIA now needs. With this team, they were able to initiate the plan with great resolve, and I'm looking forward to working with them and all directors to contribute to making FORVIA the group that we all aim for it to be. So thank you very much. If you so decide, thank you for welcoming me as a Director of FORVIA.

[Interpreted] Well, this is the makeup of the Board. Thank you, Pierre-Andre, for these few words that are very exciting for our future. And de facto, I'm showing you the composition of the Board after the expected approval of Pierre-Andre's election as first Director then Chairman.

So before you, you have the 14 men and women who make up the Board with a brief description of their activities and also, of course, their involvement in the 3 committees that I was mentioning earlier. And here, you can see also how independent the members of the Board are. Regarding the Board's activities, a few words about the committees. Esther Gaide is the Chair of the Audit Committee that met 7 times last year. Denis Mercier who will take the floor in a few minutes. He's the Chair of the Remuneration Committee that met 5 times. And I'm the Chair of the Governance, Nomination and Sustainable commitment -- Sustainable Development Committee that met 6 times. There was a joint Audit and Nominations Committee meeting so that we could work together on something that is a little new that will be recalled by the statutory auditors before in a second, the CSRD report that needs to be approved specifically by the Board in application of EU directives.

And that's a very good transition with another activity of the committee, what we are doing in terms of sustainability. Some good news in this area. Firstly, we had a first milestone in 2027 regarding carbon dioxide emissions in the Scope 1 and 2 area. The good news is that we set a goal at minus 80% reduction between 2019 and 2025. We achieved 91%, so it's much better than 80% -- and now we also emit half as much as 6 or 7 years ago.

What are the key levers for that? First of all, energy savings that we measure as the amount of electricity used per million euro of revenues, minus 33%, the consumption of fossil fuels that is accelerating faster. Well, it is reducing faster rather because we are switching to nonfossil sources of energy, minus 56% and a very ambitious policy to decarbonize electricity use worldwide, not just on a territory like France where energy is decarbonized, but in the whole world, we are able to use 99% of low-carbon electricity as solar and wind powered electricity.

Regarding the second main goal in the rollout of our climate road map, Scope 3. We are in line with the long-term goals that we had set. We already achieved 24% reduction for Scope 3 emissions compared to 2019. That went through a supply chain involvement so that -- well, for Scope 3 to reduce its emissions, our suppliers need to reduce their emissions. It's a massive endeavor because we have many, many suppliers. Also, we are working on engineering, on eco-designing our products so that sustainable design is included in the definition of our products from day 1.

And we are actively working on what is called the circular economy and therefore, materials recycling and waste reduction on our production sites and also repairability of the products that we deliver to our clients so that they can be repaired and not just be considered as waste after their first life.

Then I wanted to say a word about diversity. We reckon that one of the key indicators is the presence of women in 2 key populations in industry, there are many men. And so we want more women in industry because we think that this will support value creation and performance in the company. And so we produced the 2 indicators that you can see here.

First of all, in the top 400, the top 400 managers in the group, the percentage of women that was 15% in 2019 is now 23% at the end of 2025. We're aiming for 30% by 2030 and on a wider scope than the top 400 on scope of 40,000 people, M&P, managers and professionals. We have made a 5 percentage point increase. We started at 24% in 2019. We're close to 30% in 2025, and we're aiming for 35% by 2030. We are aiming to be some of the best in this area.

We recruit 80% of engineers, whereas women in OECD countries don't even account for 30% of engineering graduates. And so we want to attract a much higher rate of women engineers than what the education system produces. So that's it for my presentation, Mr. Chairman.

[Interpreted] Thank you, Jean-Bernard. Thank you, Pierre-Andr�. I hope that the shareholders present or connected will appreciate the relevance of this information, proving how these topics, both in terms of governance and sustainability are priorities for FORVIA. I will now invite Denis Mercier, Chairman of the Remunerations Committee, to please present the information related to the remuneration of corporate officers.

[Interpreted] Thank you, Mr. Chairman. Ladies and gentlemen, dear shareholders, on the subject of remuneration, we are presenting 7 resolutions to you today, namely resolutions 6 to 12. The sixth resolution relates to the approval of the remuneration paid or awarded to each corporate officer during or in respect of the fiscal year ended on 31st December 2025, namely the Chairman of the Board of Directors, the Chief Executive Officer and the Directors. It is noted that the remuneration of each corporate officer will also be the subject of specific resolutions.

Regarding the remuneration of the Chairman and the directors. Regarding the remuneration of the Chairman of the Board, it is proposed to you to approve the remuneration paid for the 2025 financial year, which is in accordance with the remuneration policy adopted at the 2025 Annual General Meeting, Resolution 7. And also it is proposed that you renew the 2025 remuneration policy in 2026 as approved by the 2025 Annual General Meeting, i.e., a remuneration amount of EUR 400,000, excluding benefits in kind. That's Resolution 11.

With regards to the directors' remuneration, the directors received for FY 2025, EUR 1.2 million corresponding to the full amount authorized by the 2025 AGM. It is proposed that this remuneration policy for directors be renewed for the fiscal year 2026, and that's Resolution 10.

Regarding the Chief Executive Officer, Resolution 9 concerns the components of the total remuneration and benefits of any kind paid during the 2025 financial year or awarded in respect of that financial year to Martin Fischer in his capacity as Chief Executive Officer since the 1st of March 2025.

The remuneration paid to Martin Fischer for the 2025 financial year ex post is broken down mostly as follows: a fixed remuneration of EUR 833,333, a variable annual remuneration of EUR 1,462,500 awarded for the 2025 financial year for the whole year and which will be paid subject to a favorable vote on this ninth resolution by this meeting. An exceptional remuneration of EUR 585,000 awarded for the 2025 financial year for the whole year, which will be paid also subject to a favorable vote on the ninth resolution by the meeting.

Now regarding the remuneration of the CEO ex ante for 2026 for Martin Fischer, the Board of Directors proposes to amend the following elements of the remuneration policy with effect from the 1st of January 2026. To increase the annual fixed remuneration to EUR 1.1 million. Currently, at EUR 1 million, this remuneration is 28% below the median and 39% below the 75th percentile of the reference panel used by FORVIA since 2022.

Given this market positioning, the transformation initiatives launched, as you saw earlier, and the goals achieved by Martin Fischer since the start of his term of office, the proposal is to bring his fixed remuneration in line with that of his predecessor -- a fixed remuneration of EUR 1.1 million will place the Chief Executive Officer at the median of the reference panel in terms of total remuneration on target.

The Board of Directors also proposes to amend the criteria for short-term variable remuneration to strengthen quantifiable criteria with a weighting of 80%, including, amongst others, to retain the net debt-to-EBITDA ratio and to add net cash flow to the financial indicators. Also introduce order intake and amongst the ESG criteria, the accident rate.

The following changes reflect the priority that the Board of Directors wishes to focus on. The Board of Directors also proposes to make the following changes regarding the long-term variable remuneration to replace the external criterion of growth in earnings per share with a total shareholder return criterion, TSR, to reduce the vesting period from 4 to 3 years and to replace 70% of the equity allocation with phantom shares as is the case for the group's other nontax residents in France.

The other elements of the remuneration policy will remain unchanged, including the terms of the severance pay, the noncompetition clause, the defined contribution pension scheme and benefits in kind. This closes the section on remuneration. Thank you very much for your attention, and I will hand the floor back to our Chairman.

[Interpreted] Thank you, Denis, for this very clear report. I would now like to invite Gr�gory Derouet from Forvis Mazars to present the reports prepared by -- for this general meeting by our statutory auditors, our 2 firms, PricewaterhouseCoopers Audit and Forvis Mazars.

[Interpreted] Thank you, Mr. Chairman. Ladies and gentlemen, dear shareholders, on behalf of the Board of Auditors, Forvis Mazars and PricewaterhouseCoopers, I will present the reports that we produced for you for the fiscal year 2025. We issued 9 reports for the general meeting, 1 audit report on the annual accounts of FORVIA SE, 1 audit report on the consolidated statements of FORVIA Group, 1 certification report for sustainability information, 1 report on related party agreements and 5 reports on resolutions 14 to 18 -- 14 to 23 for the Extraordinary General Meeting.

All of these reports were made available by the company. So I will simply give you a summary of the highlights in the order of the resolutions that you'll be asked to vote on. Regarding our report on the annual accounts of FORVIA SE, it is -- they are prepared according to French accounting standards. And for our key audit matters, we looked at the valuation of equity shares.

We gave an unqualified opinion and simply with an opinion on the ANC 22-6. Regarding the consolidated statements, they were prepared according to the IFRS references as adopted by the EU. We gave an unqualified opinion on these accounts. We considered as key audit matters, the accounting and presentation of the Interiors business as a discontinued operation pursuant to IFRS 5, the assessment of the recoverable value of the goodwill, the accounting and assessment of the recoverable value of development costs and the recognition and the recoverable character of deferred tax assets.

And the checks on the management's report and other documents sent to shareholders do not call for other comments. And we issued a certification report on the sustainability information and verification of the disclosure requirements under Article 8 of the EU regulation for CSRD. Based on these checks, we did not identify any errors, omissions or major inconsistencies.

For our report on related party agreements, we were not notified of any agreements authorized or concluded during the past financial year. And for the extraordinary part of the general meeting, we issued reports as mentioned behind me for Resolutions 14 to 18 Resolutions 20, 21 and 22, there are no observations to make on the operations covered by these resolutions and which are part of the conditions provided for in the Code of Commerce. Thank you, dear shareholders, for your attention.

[Interpreted] I would like to thank Gr�gory Derouet for this presentation, which I commend for its clarity and conciseness. I wanted to add something that was not expected. I would like to say that when the statutory auditors see things that are so favorable, it is because the financial team did a good job. And so Olivier, please pass congratulations on to your team for the quality of their work. Now let us move on to the Q&A session. In fact, there will be 3 types of questions.

First, oral questions asked by our shareholders present here, maybe the questions that you will ask, then written questions received within the statutory time frame and then the written questions that you were able to ask this morning with forms made available at the entrance of the meeting room. So 3 types.

Regarding oral questions, I would ask those of you who want to ask a question to please do so now or in a few minutes. Please keep your questions as concise and clear as possible to leave time for answers. And I would also like to ask those of you who want to ask questions to please introduce themselves before asking their question.

I would like to point out that some of our answers will be provided in English. And I would also like to say that you can use the translation headsets that were made available to you to receive simultaneous French interpretation, if useful. So my question is, are there any questions in the room? If so, the first thing to do is to raise your hand. Martin, do you see hands raised?

No hands raised, so let's move on.

[Interpreted] All right, then. Since there are no questions from the audience, we'll move on to written questions that we received from our shareholders within the statutory time. We have as many as eight questions from Wakefield Securities LLC and WAKELAND Securities L.P. The answers to these questions are -- will be found available on the website after this AGM. But no, rest assured, we will answer the questions. But to be perfectly clear, people attending this session and people online can read out the answers to the questions.

I'll give the floor to Jill Greene, who is our Legal -- Chief Legal Officer, and she will read out the answers we provided. As the questions were asked in English, well, Jill will answer in English. It turns out it's just as well because she speaks better in English than French. Now a French version that I said, will be available on the company's website after this AGM. Jill?

Thank you, Michel. Question one. With respect to the ongoing advanced pricing agreement, APA, procedure in relation to the use of the FORVIA trademark by HELLA initiated with the French and German tax authorities. We understand that FORVIA has received a questionnaire sent by the French tax authority in April 2026. Does such questionnaire or your initial interactions with the French tax authority give any indications as to whether HELLA and FORVIA may use the other company's trademark without royalty payments.

Does each company have a right to use the other company's trademark? Or is it a discretionary and revocable decision of the other company only?

And the company's answer. Under the trademark license agreement entered into on September 23, 2024, between FORVIA and HELLA, FORVIA authorizes HELLA to: one, use the FORVIA brand; two, the trademarks relating to the term FORVIA; and three, the inspiring mobility motto with no royalty to be paid or invoiced until the date upon which the German and French authorities have agreed on the tax advanced notification procedure, as I mentioned as APA.

The approach that the German and French tax authorities shall deem appropriate shall apply retroactively as of July 1, 2024. Thus, the parties will apply the approach deemed appropriate by the German and French authorities and will be bound by the terms of the APA for the financial conditions of the trademark license agreement.

This approach ensures compliance with applicable laws and regulations and in particular, tax regulations and provides a structured framework for financial management related to the use of the FORVIA brand. At this stage, the procedure remains ongoing, and there have been no material developments to date.

As noted in the question, both the German and French tax authorities have sent normal questionnaires asking additional standard information for this type of procedure. There is no indication at this stage what could be the position of the relevant authorities.

The trademark license agreement is only related to the use of the FORVIA brand, the trademarks related to the term FORVIA and the inspiring mobility motto by HELLA. There is no license agreement granted by HELLA to FORVIA for the use of the HELLA brand.

Question number two, could you also indicate when the APA procedure is due to end and whether the trademark license agreement pursuant to which HELLA as licensee may use the FORVIA trademark is due to end with the conclusion of the APA or whether it should continue and if so, for what duration? Could you also confirm that if it is due to continue, it will continue on the terms determined by the APA? What is planned in respect of mutual trademark sharing and royalty payments in the mid and long term?

And the company's answer. The trademark license agreement runs until the APA procedure has been concluded. This is expected in 2028. After that, the parties are to discuss whether the agreement will be extended. FORVIA has no control over the timing of the reviews by the German and French tax authorities and continue to cooperate with any requests received.

Upon completion of the APA at the latest, the parties shall negotiate in good faith and in a timely manner to determine whether the trademark license agreement shall be renewed. The parties have already agreed to be bound by the terms of the APA for the financial conditions of the renewal of the trademark license agreement.

Until the date upon which the APA procedure is over, the license under the trademark license agreement shall continue to be granted with no royalty paid or invoiced. The approach to be determined by the German and French tax authorities shall, as I said, apply retroactively from July 1, 2024.

Thus, the parties will apply the approach deemed appropriate by the French and German tax authorities. And accordingly, we will be bound by the appropriate terms of the APA for the financial conditions of the trademark license agreement. As I said before, this approach ensures compliance with applicable laws and regulations and in particular, the tax regulations and as well provides a structural framework for the financial management related to the use of the FORVIA brand.

In addition, and subject to the outcome of the APA, in the event the party's common considerations upon which the trademark license agreement is based with respect to the brand equity and brand valuation of both FORVIA and/or HELLA brands or the benefits of FORVIA resulting from HELLA's use of FORVIA brand significantly change, the party shall negotiate in good faith to determine whether a royalty or remuneration payment shall be made from one party to the other party in respect to such changes.

And whether the trade license agreement shall be amended accordingly. If such negotiations are needed, the renegotiation will be based on the principles of the German de facto Group laws and regulations.

Turning now to the third question. The FORVIA Group has been using both trademarks, FORVIA and HELLA as well as the combination thereof for years now. How is the value of each trademark as well as the combination thereof developed since 2022? Please lay out the details of the assessment of the valuation. Has such valuation been independently conducted by FORVIA or has FORVIA relied on a valuation instructed by HELLA and the company's answer.

FORVIA and the legacy FORVIA companies do not use the combination of FORVIA and HELLA trademarks without the consent of HELLA. In such cases, the combination of the FORVIA and HELLA trademarks is limited only for topics, events and publications where HELLA is engaged and has agreed for such trademark combination being displayed or used at HELLA's sole discretion.

Regarding brand assessment, FORVIA conduct studies regularly on brand evaluation. We do not communicate figures on the value of our brand or our intellectual property. FORVIA's branding strategy was defined at the creation of the combined group. It was driven by the need to define a brand transition strategy for HELLA and a desire to evaluate the financial and reputational impact of different branding scenarios under the FORVIA umbrella.

FORVIA has conducted an analysis with its own independent brand valuation expert. HELLA instructed Landor & Fitch to conduct analysis regarding the use of HELLA and the HELLA brand, which is repeated regularly. This assessment has a focused scope directed by HELLA as HELLA described during its 2026 Annual General Meeting.

The cooperation between HELLA and FORVIA with respect to the use of brands has been designed to maximize the cross penetration of each brand. HELLA benefits from the use of the FORVIA brand in markets and business areas where it did not have a legacy presence. In return, FORVIA benefits from the value increase and promotion of its brand name by HELLA in new markets and business areas.

Question number four. HELLA reported EUR 500 million of synergies at the end of 2025 in its annual report. Could you please reconcile this amount with the EUR 400 million of synergies that FORVIA has reported, namely, what are the bridging items that explain the EUR 100 million differential? Please quantify each bridging item and the company's answer.

The difference between the cumulative synergies reported by HELLA and FORVIA is mainly driven by, first, cost avoidance measures excluded from FORVIA's reporting as they are not considered synergies per se. They represent roughly half of the variance. And secondly, the gap between the actual and annualized operational synergies largely stemming from the implementation of the FORVIA Excellence System.

And question five, has FORVIA met the 50-50 allocation of synergies target indicated by FORVIA at its 2025 Annual General Meeting? If this target has not been met, what measures does FORVIA intend to implement to increase its effective share of synergies of 50%?

And the company's answer. The synergies, as they stand, benefit more to HELLA with roughly 2/3 of the total amount rather than to FORVIA. FORVIA benefits from all realized synergies, however, as it consolidates HELLA.

Question number six, could you please provide guidance on the incremental synergies by the end of 2026? To what extent will the disposal of the Interiors business group affect both the previously communicated realized synergies and the future synergy targets? How do the realized synergies break down by FORVIA division?

And the company's answer. From inception, FORVIA has communicated synergy targets by 2025 that have been revised upwards twice and achieved. After 4 years of collaboration, the base synergies have been achieved and FORVIA will continue to work with HELLA under current governance structure.

FORVIA has identified modest dissynergies in terms of purchasing after closing the interiors divestiture. By division, Lighting and Electronics were the primary beneficiaries of the synergies.

Question 7. Has FORVIA's Board or management quantified the incremental synergies achievable under a full integration of HELLA? Please disclose the quantum broken down into operational synergies, tax synergies, cash pooling synergies, financing synergies and other benefits or confirm that no such analysis exists.

And the company's answer. Our priority today is to implement the business plan IGNITE. The first 3-year period will be based on focus and strengthen and after 2028 on lead and grow. And owning 100% of HELLA is not a key priority for FORVIA in that context. We have developed strong governance to reach a stable and efficient way of collaborating with HELLA, and this is clearly seen through the synergies that we report.

And finally, question 8. FORVIA's convening notice for the 4th of June 2026 AGM mentions cash upstreaming initiatives from subsidiaries. Please specify the nature of these initiatives and identify the subsidiaries concerned.

And the company's answer. In 2025, FORVIA upstreamed significant amounts of cash from its affiliates, especially from China, Brazil, Germany and Morocco through enhanced cash pooling and/or dividends. Zooming in on HELLA, please note that there is no cash pooling arrangement between FORVIA SE and HELLA. With this, all written questions that were received before the meeting have been answered.

[Interpreted] Well, thank you, Jill. And inasmuch as Jill answered the questions, I watch faces. And I noted maybe a touch of boredom on the part of some shareholders, but it is for us to answer all questions even if they are repetitious. You may have noted that there was some repetition between the questions.

But I'd certainly like to thank Jill for reading out the answers. So we answered all the questions put in writing in within the statutory time limits ahead of this meeting. Then questions in -- just put in through the forms. I believe there's only one such questions, and I'll read it out. And so it is one of you who asked -- put this question writing. It's about hydrogen. Are you...

I think there's a question for you, Martin. Are you involved in hydrogen-based mobility? If so, would you propose to come out of it?

We have invested in hydrogen technology over past years. And we have 2 activities going. One is FORVIA tank systems, hydrogen storage tank systems. And the other one are fuel cell stacks that we develop in our joint venture, Symbio. So since we decided these investments, the market has not developed and accelerated at the expected speed. So through the Ignite portfolio review last year, we also came up with a conclusion how we want to treat our hydrogen business.

So first of all, we are holding on to both activities. Together with our joint venture partner, Michelin, we hold on to Symbio. And here, we are now focusing development of fuel cell stacks, not only for mobility applications, but also for stationary applications.

And on our tank side, we look at a very fine portfolio and offerings of tanks that we are selling and we produce as we speak. So we continue that with a clear expectation that financially, we become cash flow neutral by the end of this year. So yes, we are invested and we keep pursuing these activities.

[Interpreted] Thank you, Martin. That was, in fact, the only question in writing that we received after the questions that were sent in before the AGM. Right. Well, I would like to thank you for this exchange. But of course, should there be additional questions after the AGM, please get in touch with our IR department.

And I believe some of you are familiar with this department. I believe we have people from Investor Relations right here in this very room. We'll move on to the resolutions, and I'll call on M�lissa Bensemhoun, who's Head of the Legal Department. M�lissa, take it away.

[Interpreted] Well, thank you, Michel. And ladies and gentlemen, let me provide the following regarding the attendance numbers, the number of shares held by shareholders either present or represented or giving a proxy, 123,179,851 or 62.89% of shares with voting rights.

Regarding the voting procedure as such, the resolutions for the ordinary part of the AGM, that is resolutions 1 to 13 and indeed Resolution 26 need to have a simple majority of shareholders either represented or having voted by proxy by post for the extraordinary part, that is resolutions 14 to 25 require 2/3 of the votes of shareholders either voting now or having voted by post.

Please tick the voting box. You have a slide right here showing you how to use it. When voting is open, press either 1 for, 2 against and 3 abstain. You may change your vote while the vote is open by pressing a new different button and the word confirmed must appear in the bottom right-hand corner of the device to be -- for your vote to be counted. The full text of all resolutions has been published within the statutory time limits and appears together with the explanatory notes on Pages 21 to 45 of the notice of the meeting, which is available on the website, then it is the reason why we'll only give a brief presentation of these resolutions when they are put to the vote.

So we start with the ordinary part of the AGM. Resolution #1 is the approval of the financial statements approval on nontax deductible expense and costs. Please vote now.

[Voting]

[Interpreted] So voting is closed and the resolution is adopted. Number 2 is the approval of the consolidated financial statements for the fiscal year ended 31 December 2025. Please vote now.

[Voting]

[Interpreted] Voting is closed -- and the resolution has been passed. Resolution #3 is about the appropriation of the income for the fiscal year. Please vote now.

[Voting]

[Interpreted] Voting is closed and the resolution is passed. Resolution #4 is about the related party agreement. In 2025, you asked to adopt the statutory auditor special report on such agreements and there were, in fact, no such agreements. Please vote now.

[Voting]

[Interpreted] Voting is closed and the resolution is adopted. #5 concerns the appointment of Pierre-Andr� de Chalendar as Board member. Please vote now.

[Voting]

[Interpreted] Voting is closed. Resolution is carried. 7 resolutions to come about compensation. #6 first. You asked to approve the information referred to in Article L. 22-10-9 of the French Commercial Code on compensation of corporate officers for 2025. Please vote now.

[Voting]

[Interpreted] Voting is closed and the resolution is adopted. Resolution #7 is to do with the expost vote on the 2025 compensation of the Chairman of the Board of Directors, Michel de Rosen. Please vote now.

[Voting]

[Interpreted] Voting is closed. And the resolution is adopted as well. Resolution #8 is on the elements comprising the total compensation of all benefits of any kind paid during the fiscal year ended 31 December '25, or granted in respect to the same year to Patrick Koller. Please vote now.

[Voting]

[Interpreted] Voting is closed. And the resolution is carried as well. #9 is -- relates to the exposed vote on the 2025 compensation of Martin Fischer, CEO since 1st of March 2025. Please vote now.

[Voting]

[Interpreted] Voting is closed. The resolution was adopted. And so Resolution #10 relates to the ex-ante vote on the compensation policy for directors for the year 2026. Please vote now.

[Voting]

[Interpreted] Voting is closed. Resolution is adopted. #11 concerns the ex-ante vote on the compensation policy for the Chairman of the Board of Directors for the year 2026. Please vote now.

[Voting]

[Interpreted] Voting is closed. And the resolution is adopted. #12 concerns the ex-ante vote on the compensation policy for the Chief Executive Officer for the year 2026. Please vote now.

[Voting]

[Interpreted] Voting is closed and the resolution is adopted. #13 is authorization to be granted to the Board of Directors to enable the company to buy back its own shares. Please vote now.

[Voting]

[Interpreted] Voting is closed. And the resolution is adopted. Thank you.

Now let's move on to resolutions on financial authority. 14th resolution, delegation of authority to be granted to the Board of Directors to issue shares and/or securities giving access immediately or in the future to the share capital of the company and/or subsidiary and/or debt securities with preferential subscription rights. Voting is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. In the 15th resolution, you are asked to allow the Board of Directors to issue shares and all securities giving access immediately or in the future to the share capital of the company and/or subsidiary and/or debt securities without preferential subscription rights through public offerings and/or as compensation for securities as part of a public exchange offer voting open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. You are asked for Resolution 16 to allow the Board to issue shares and all securities giving access immediately or in the future to the share capital of the company and/or subsidiary and securities without preferential subscription rights through an offer exclusively targeting a restricted circle of investors acting for their own account or qualified investors. Voting is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. Resolution 17 would allow the Board of Directors to increase the amount of issues provided for in 14th, 15th and 16th resolutions. Voting is open.

[Voting]

[Interpreted] Voting is closed. Resolution is approved. Resolution 18 would allow the Board of Directors to issue shares and all securities giving access immediately or in the future to the share capital of the company without preferential subscription rights in order to remunerate contributions in kind of securities granted to the company. Voting is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. 19th resolution delegates authority to the Board to increase the company's share capital by capitalization of reserves, profits, premiums or other amounts whose capitalization would be allowed. Voting is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. Resolution 20 authorizes the Board of Directors to grant for free existing shares and/or shares to be issued to employees and/or certain corporate officers of the company or affiliated companies or economic interest groups with waiver by the shareholders of their preferential subscription rights. Voting is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. Resolution 21 authorizes the Board to increase the share capital through the issuance of shares and all securities giving access to the share capital with removal of preferential subscription rights for the benefit of members of a company or group savings plan. The vote is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. Resolution 22 authorizes the Board of Directors to carry out share capital increases with removal of preferential subscription rights in favor of categories of beneficiaries. Voting is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. Resolution 23 authorizes the Board of Directors to reduce the share capital through the cancellation of shares. The voting is open.

[Voting]

[Interpreted] Voting is closed. Resolution is approved. Resolution 24 relates to the amendment of Article 11 of the Articles of Association of the company to provide for the staggering of Board members' terms of office. Voting is open.

[Voting]

[Interpreted] Voting is closed. Resolution is approved. Resolution 25 amends Article 13 of the Articles of Association to remove the exceptional reference relating to Board observers. Voting is open.

[Voting]

[Interpreted] Voting is closed. Resolution is approved. And finally, Resolution 26 grants powers for formalities. Voting is open.

[Voting]

[Interpreted] Voting is closed. The resolution is approved. All resolutions were adopted, Michel.

[Interpreted] Thank you, Melissa, for leading this exercise. Of course, I would like to thank the shareholders for approving all the resolutions that were submitted to them with sometimes impressive scores. This major and positive participation is crucial to the life of our company, and it is very fortunate. Martin, I think the floor is yours.

Yes, Michel. Before closing this Annual General Meeting, I would like once again to thank you for your trust and support. As your term as Chairman draws to a close, I also wanted to pay tribute to the vision you have brought to FORVIA and your decisive role in the group's development.

10 years ago, Faurecia was a company focused on commodity businesses within the PSA Group. Today, FORVIA has become an independent and global tech company driven by a culture of commitment and accountability. Thank you, Michel, for having supported and guided this remarkable transformation through your boldness and high standards.

Beyond strategy and governance, what I will remember above all is your leadership-based approach that you've set with passion and a deep sense of responsibility towards the women and men of this company. You will leave a lasting mark on FORVIA, on its teams and on me personally. I offer you my utmost respect, gratitude and my warmest wishes for this new chapter ahead. Thank you very much.

[Interpreted] Thank you, Martin. These words -- these words move me. I prepared a few last lines for all of you, in fact, but just before that, let me say this. I couldn't really sleep last night. I was thinking about our AGM about us parting ways. And I was thinking what verse from French poetry I could share with you to illustrate this moment. And I found 2 lines from the great poet Malherbe, probably not well known in the U.S., but fairly well known in France. There's an ode to the King of France, and there are 2 great verses, which loosely translated, say, the harvest of our fields will wear down the sickles and fruits will pass on the promise of flowers. I thought it was a quite good outlook for FORVIA to set a prospect of success and prosperity.

And I thought, well, yes, but it's not very automotive focused. So I wrote an extra 2 lines myself to show that I'm not the poet Malherbe. But it says, well, I had to rhyme with flowers and sickles. So loosely translated, always we will be associated by with engines and selling shiny new products. Well, it's not very poetic, but that's what I found.

Coming back to serious matters. There are no further items on the agenda. I declare the meeting adjourned at what time at 12:11. I would like to thank all those who prepared this general meeting and ensured it ran particularly smoothly. It is, of course, with some emotion that I bring this 2026 General Meeting to a close.

And as I take my leave of you, I would like to express my deepest gratitude, of course, for your presence here today, but above all for the trust and unwavering support you've shown me throughout these 10 years in office. These years have been marked, as Martin said, marked by significant transformations and by demanding challenges for Pierre-Andr�. And I know we have a constantly renewed collective ambition in the service of our clients. I'm now stepping down with peace of mind and confidence in the group's future.

FORVIA is in very capable hands, those of Martin Fischer and Pierre Andr� de Chalendar, whose respective commitments, experience and vision I know well. So in closing, a confession on my part, I'm now leaving FORVIA with some sadness. I took office 10 years ago. I was then an outsider. When I wrote these few words, I even wrote that, well, communications told me it's not done, but I felt I was like an immigrant worker. Well, that shouldn't be said, but that's the impression I had when I arrived. And since then, I've become part of the Faurecia FORVIA family, and I'm now deeply attached to it.

I'm proud of having contributed to the choice of Martin Fischer and Pierre-Andr� de Chalendar. They are both wonderful men, and they will do an excellent job. I have no doubt about it. If you allow me to say that, they will lead FORVIA into the promised land. Well, you can choose whatever that means. I wish them the best success in the development and reputation of our -- your company. Thank you to everyone, and then we can meet next door to say a few more words. Thank you, ladies and gentlemen, for this useful, effective and efficient general meeting and a good introduction to the rest of the year 2026 for the FORVIA. Thank you.

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

Good morning, ladies and gentlemen. First of all, thank you for joining us after we have broadly talked on Friday. However, we have accomplished results over the weekend that I think I really want to share with you. And so I'm very happy to report that we have signed an agreement to sell our Interiors business to Apollo. So we signed the deal on the expected terms that we have communicated in spite of a challenging environment through the Middle East crisis. So we can attain out of that transaction an enterprise value at EUR 1.82 billion and the anticipated net debt reduction of at least EUR 1 billion.

Olivier Durand, our CFO, is with me, and he's going to share some further financial details in just a second. The project is obviously subject to works council consultations that we have started this morning and then also the customary regulatory approvals. I'm convinced that this project is possible because it reflects on the strength and the leadership of FORVIA Interiors as well as the expertise and the commitment of our global interiors teams.

So it highlights the business group's very solid industrial base, its market positioning and the good value creation potential that the acquirer sees in FORVIA Interiors. So it goes without saying that this is a key milestone in the execution of our IGNITE strategic road map that we discussed during the Capital Market Day on February 24. It is, in fact, sharpening FORVIA's focus on high value-add technology-driven activities. And as well, we strengthened our financial structure by paying debt down, as I commented earlier on.

And at the same time, for the Interiors business going out, the business is gaining a very dedicated ownership and Apollo has a very strong sector expertise and an active ownership approach to their automotive activities. So that's going to support the future development and the transformation of the Interiors business in a consolidating market environment. So Olivier, why don't you share the numbers that are now associated with that transaction?

Happy to. Good morning, everyone. Thank you, Martin. So let me provide some color on the key financial terms of the transaction with Apollo. So as mentioned, the agreement implies an enterprise value of around exactly EUR 1.82 billion. This is corresponding to 3.1x the adjusted EBITDA under IFRS of the business. Another data point is to mention that if you take a kind of proxy of the U.S. GAAP, i.e., excluding R&D capitalization and lease, which is more the type of comparison to assess the multiple of a transaction, in fact, the multiple will stand at 4.8x.

We confirm the expected net debt reduction of at least EUR 1 billion. And I want to stress that the bridge that we are talking about between enterprise value and net debt reduction is comprehensive. It's taking all items into account, including transaction costs and including the consolidation of the cash of joint ventures in which we have a majority stake.

So it takes into account the deduction for minority interest in the joint ventures that we have inside this business. It takes into account the debt adjustment, including the pension liabilities, and it includes all carve-outs and tax cost of the transaction before and after closing. Given the cash position and the distribution of the cash inside this business, the gross debt reduction will be actually higher. It will exceed EUR 1.4 billion. And this is, in fact, the relevant metric to use in order to assess the reduction in financial cost that this transaction entails.

On a run rate basis, this reduction will be around EUR 50 million to EUR 70 million in lower financial expenses per year. We expect the closing to happen by year-end subject to the customary conditions precedent, including regulatory approvals.

I want to stress that this is a definitive transaction, excluding those basic regulatory approvals. We will continue to manage Interior as a FORVIA business group until that date, and we will benefit from the net cash flow generation that this business has until the actual closing of the transaction, which is most of this year.

All proceeds will be allocated to debt reimbursement and which means that, in fact, with the combined -- with the expected organic cash flow generation in '26, we expect to reach a financial leverage of 1.5x, and we expect a net debt to reach EUR 4.5 billion at year-end as we communicated during the Capital Market Day. This means a division by 2 of both the leverage and the level of net debt compared to the initiation of the acquisition of HELLA back in '22. This transaction, therefore, support the full restoration of FORVIA financial structure and is totally aligned with our IGNITE framework, which targets ultimately a leverage ratio of 1.2x by the end of '28.

And on this note, I return to Martin.

Yes. Thank you, Olivier. And before talking about the next step, I would like to thank, first of all, Michel de Rosen, our Chair and the entire Board for the support of the project. And then most importantly, also all Interiors employees for their commitment and contributions. And we have seen very good contributions really when it comes to the operational business, but also in terms of preparing this transaction.

So again, we expect a close of the project by the year-end, and when the financial effect should kick in as well. And you can imagine what kind of an important milestone this transaction is for the group and for our IGNITE strategy. So I look forward to finishing a successful year together with the colleagues in Interior because the numbers that you have heard about are also considering on the cash side, still the incomes from the Interior business this year.

So when looking forward, I mean, it's exciting around for FORVIA. We have our 2 clusters, the growth and the value clusters that are nicely complementary in nature and that we are going to develop. And we have our 3 strategic priorities with best-in-class performance, business transformation, the announcement today falling into that priority and invigorating our culture.

So the compass is clear. And then it go without saying on the next 2 pages, also in light of that Interiors transaction, I want to explicitly confirm all elements of our 2026 guidance.

And on the next page, we are reiterating also our 2028 ambition. And you can imagine now with that first important step in terms of portfolio transformation, we are obviously also confirming all ambitions and all numbers around 2028. So we are getting ready to unlock what's next. And at the same time, we drive what matters so much every single day.

And with that, I would like to open up for questions.

[Operator Instructions] The first question comes from Ross MacDonald of Citi.

Congrats on getting this deal done. I think a lot of investors had assumed this would be second half business, so very impressive. I have 3 quick questions. I think we touched on one previously, just around dis-synergies. So I'm thinking about your business going forward, specifically for things like Interior lighting and seating. How do you think about the loss of the Interior business and the potential dis-synergies over the midterm from a revenue perspective for those businesses? Is it something that customers typically expect for it to bring Interior seating as a combined package? Or do you think that there's limited headwinds from the loss of Interiors from a synergies perspective? That's question number one.

First of all, and thanks for rejoining second day, second workday in a row. On a product level, on a top line level, we are not expecting any dis-synergies. And I tell you what we observed over the last couple of years. FORVIA has strongly driven the concept of cockpit of the future, interior of the future. And you could see in some of the trade shows that we really animated and designed complete interiors of vehicles to give the customers ideas of what's possible.

At the same time, we have never come really to combined sourcing of our OE customers. In other words, they buy seats separate from the Interiors. So whereas this engineering exercise, the design exercise helped to position both interiors and seating products, it would never ended up in combined deals and therefore, synergies. What we intend to do on a way forward, we have a unit that's called the XLAB. And the XLAB is basically combining engineers from all of our business groups, and we will retain Interiors' expertise on that XLAB, so that we can continue to create new experience for Interior. But then after the transaction, we are going to fully focus on selling the seating products. And again, that traditionally has been independent from interior product sales.

And my second question is just around the employee transfer. And if you can maybe just confirm how many employees were within Interiors, I had 31,000 in my mind. Will all of those employees transfer over? And you mentioned the Works Council approval. Is that something that we should think of as a formality here? Or is there a potential roadblocks around Works Council as it relates to this deal?

Yes. No, we are selling ultimately the entire business. So all Interior employees one by one are going to go over into the new company. So that's clearly agreed with the buyer. And as far as the Works Council approvals or consultations are concerned, it's a consultation, and that's very well defined in French law. So we started that this morning. We informed the Works Council, and we expect the period of conversations and discussions. We expect that to find a good way towards the deal. So no deal breaker expected as of now.

And then you also will have the regulatory approvals, foreign direct investment and so on with different jurisdictions. Given the nature of Apollo's business and ours, also here, as of now, we do not expect roadblocks.

Maybe a final one and just a strategic one. Obviously, you've done this deal at a very challenging time in the automotive supply chain. Is there anything when you look at the business as it stands going forward, excluding Interiors, is there anything within the value clusters that you think actually -- given the valuation we're getting for Interiors, which looks attractive, is there anything within the group that you would think could be further monetized by FORVIA? I know you want to keep the value versus growth segments, but just curious if the opportunity presents itself, if you would look to monetize other parts of the group given the valuations that you're achieving today?

Yes. No, whereas we do not pursue concrete ideas or projects at this point in time. We discussed that during the CMD, right, saying both the organic deleveraging and now in particular, the Interiors deal, we do not have the same pressure as of before. So there is nothing concrete in the make. At the same time, it is an option for the value cluster if opportunities should present themselves.

The next question comes from Stephen Reitman of Bernstein.

So congratulations on the deal. Again, I mean, it was very much following on from the questions that Ross was asking really about the overlaps. I think, you made that very clear that there isn't -- you have been running these separate businesses. But again, on sourcing really, could you just give a little bit more about that, just to sort of reassure us already that the scale impact [indiscernible] going to suffer from the loss of scale.

Yes. No, good question, Stephen, and welcome back to the call this morning. There is obviously lots of plastic material sourcing happening around the Interiors business. And then the second big consumption we have on plastics parts is on the lighting side. So it is important to look at the concrete plastic resins that we purchased for both. And there is only limited overlap, right? You can imagine between the screens of a headlamp and what we put into a door panel, it's quite different materials. So the dis-synergies are going to be very limited in that regard. We estimated it, call it, single million euros of dis-synergies possible on the purchasing side.

[Operator Instructions] Mr. [indiscernible], there are no more questions registered at this time.

All right. We check into the online questions. Just give us a second.

Okay. So we have a few questions on the chat. Let me take the first one. What is the effective economic date of the transaction? And to what extent may the price be adjusted for cash flows between now and completion?

So first of all, it's a firm deal. Now, they have the process of regulatory approvals and the transfer. So we expect the transaction to get to closing by the end of the year, probably fairly Q4 of this year. The price of 1.82 [indiscernible] Interior is part of the company until the closing, i.e., the cash flows of the Interior business are part of the evolution of the company. So in terms of IFRS of '25, it will not appear in terms of the operating metrics. That's why our guidance are totally unchanged. But in terms of the net debt reduction, this is part of the net debt reduction we expect during the year. To keep things [indiscernible] if you take the average of the last 2 years, '24 and '25, you are getting at [ 150 million EUR].

The second question, EUR 1.82 billion is corresponding to a 3.1 multiple of the EUR 582 million of adjusted EBITDA IFRS of '25. Is that not a bottom line factor for a company of this size. And between buckets, the notice factor 3 is more for low and medium-sized companies. What about account receivables minus accounts payable inventory, which should be added to the 3.1 multiple of the adjusted EBITDA? Thanks for your feedback.

So on the data, you are totally correct, [indiscernible] 582 is what is reported. If the IFRS [indiscernible] of the company exactly the perimeter and the enterprise value is EUR 1.82 billion. Regarding working capital, we have taken into account variations that can happen and this is how it leads to it's incorporated in all the adjustments we are showing you in the bridge. Let me stress once again that the bridge is really reflecting all the adjustments. In fact, the impact of the fact that part of the business is joint ventures. So EUR 1.82 billion is at 100% ownership of everything. So we have to take into account that we don't own 100% some of the companies and a few in particular in China. This is taking into account the debt adjustment of different nature and all the transaction costs, carve-out, separation, fees of the different advisers as well as the tax cost of the transaction.

And maybe another element in M&A world in terms of evaluating companies, people are more used to use U.S. GAAP or proxy of U.S. GAAP, which in this case would be the EBITDA excluding R&D capitalization, amortization and lease. If you take this differential, which is more comparable on the worldwide basis, actually, the multiple is 4.8x, which I think is more reflecting, in fact, the value of the deal itself.

Do we have some questions on the call itself before we take more questions on the chat?

[Operator Instructions] I confirm Mr. [indiscernible], we had no more questions registered at this time from the audio call.

Well, then we continue with the online questions.

No problem. Next question, what will be the new company brand name managed by Apollo?

And that is an answer we cannot share yet. So there will be a new name, and it's going to be published then on time.

The next question is what's the exit window of time frame strategy for a PE like Apollo? And will there be another divestiture from Apollo to another [indiscernible] strategic entity as buyer?

The thing that we can say is Apollo is in the automotive business for quite a while and have created a fairly large position with the different acquisitions they have done in the last few years, Panasonic, TI, Tenneco. It's becoming a large, in fact, automotive supplier group of companies. So I think this is the strategy they have and to develop the business and to have, in fact, the means to develop this business. We have no other information.

The next question, I think FORVIA has around EUR 2.4 billion debt coming up in '26 and '27. And correct me if I'm wrong, but you are mentioning a EUR 1.4 billion gross debt reduction from this asset sale. So can you please explain how you managed to reduce interest costs when you will need to refinance some debt in '26 before they fall current?

So in terms of the different items of debt maturities coming '26, '27, we will have EUR 1.4 billion coming from this transaction. We will have another EUR 0.5 billion from the business itself. And we continue our work of cash [indiscernible] and simplification of our flows. You have seen that we have reduced the gross cash a little bit last year. We expect to reduce excluding, in fact, this transaction, the gross cash even more, which means that in terms of new -- in terms of refinancing, we expect limited activity. The exception to it is there is inside those numbers, a bond in HELLA, which is maturing in January 2027, and HELLA will probably refinance part of it in over the course of this year. So that will be the main refinancing transaction.

We will monitor, of course, the evolution of interest rates and remain opportunistic on this in the different markets from a credit world in which we operate since we are now having access not only to eurobond [indiscernible] U.S. bonds and smaller activities, Japan, China.

Next question. What amount of pensions factoring and reverse factoring, respectively, will travel with the entire business?

So in terms of pension is actually EUR 69 million. In terms of factoring, it will depend how we will finish, but it's -- you have seen that we reduced, in fact, the factoring balance by EUR 100 million overall before the transaction itself. And I would say that this is -- we will not reconstruct a position anyway and maybe going further down. And in reverse factoring is actually a small number that is going with this business, EUR 50 million, EUR 70 million in reverse factoring position.

Do we have other questions on the call?

[Operator Instructions] Mr. [indiscernible], there are no questions registered at this time.

So I continue and complete the chat. How much of your existing business was tied into your Interiors offering? Is there a risk of losing any seating electronics business now?

No, that is an answer we had with Stephen's question and Ross's question. Basically, there is no business that we are going to lose. We are excluding from the Interiors business, the MATERI'ACT perimeter. Remember, MATERI'ACT is the company where we develop and produce sustainable plastic materials. That's going to stay with FORVIA. And there, we have already today a supplier relationship in place with the Interiors business, and that's going to be written over to the new company. So we continue to supply of these sustainable materials to the new company.

Next one, congratulations on the deal. Could you give us more details on the use of the proceeds?

So it will be fully used for that reimbursement. And from a financial debt perspective, it will be on maturities, '27 and '28. And we will see which choice will be the most attractive.

Next question, can you please remind us the P&L impact from discontinued operation in '26?

Frankly speaking, it's not a reminder because we did not mention this one. But what we can say is that we -- during the Capital Market Day, we mentioned that as part of the operation, some of the costs, including the tax cost upon closing could not be booked in '26 -- '25, sorry. And we expect this to be around EUR 150 million. Vice versa, Interior is contributing to the net income. So you should expect a bit less than this EUR 150 million in terms of the net P&L impact in discontinued [indiscernible] something should be around the number, but there are some accounting aspects that can provide some volatility on this.

The next question is what is the best estimate of the minority P&L and minority dividend you can give for '26.

I assume that the question is not related to the transaction itself. But before answering this one, let me mention that as part of the transaction, we simplify, in fact, our structure and we have less joint ventures as a consequence, meaning that the leakage in terms of minority dividends and minority P&L is reduced. Minority P&L is something like EUR 30 million plus that is going away, in fact, with this transaction starting therefore in '27.

In terms of minority P&L for the company itself as a whole, we are in the EUR 100 million, EUR 120 million range, no change on this type of aspect.

Next question. Do you expect any rating action following that business reduction in scale, but that is also reducing basically the rating unchanged?

I think the rating agencies are fully informed of this transaction coming. We will have communication with them. I think it's a confirmation of executing our plan after in terms of rating evolution, it's, of course, a decision that they take. But clearly, the profile from a debt perspective, from a cash management perspective is improving significantly with this transaction. So I think it's a good element in terms of the financial structure and the credit view of the company for structure.

Next question. What will be the impact of the support service function currently being provided by GBS to the Interior activity? Will this support continue as is? Or are there any changes being planned?

Yes, very good question. I mean we are going to hand over an independent self-sustained company to Apollo, which means that we are also going to provide functions and the employees performing these functions in terms of corporate services. So that's going to happen now as part of the separation process that we clearly identify, resources personnel that goes over with the business.

So to the earlier question, we are going to transfer all employees that are associated with the Interiors business directly, plus those corporate services that the company will need to operate. Olivier, do we have another question on the chat?

We do. Could you quantify the bridge element in Slide 3, which is the slide of the bridge. Regarding the debt adjustment aside from the EUR 69 million in pension, what are the other parts of this?

So we are showing in the bridge, in fact, 3 big blocks. So the first block is minorities. Our minorities is coming from the fact that 1.82 is at 100%. We have some companies in which we own less than 100%. And therefore, there is a deduction for the value of those one as well as the fact that we have some cash position inside those companies and mechanically, since -- and we consolidate those cash position today at 100% when you have the sale, you are paid for the part of the company you actually own.

So this is on the first block, and that's -- so that's why it's significant. It means also once again that the complexity of the company will be reduced by this transaction. The second block is debt adjustment in which there is the pension. There is also some working capital and miscellaneous financial adjustment that are taken into account inside this block. And the last one is all the carve-out separation cost. This is also the tax cost of the transaction. We had some tax costs in terms of verticalizing the legal structure according to this perimeter, and we will have a little bit of tax cost mainly in China in terms of tax on capital gains in some jurisdiction, a few of them, as you can imagine, but in China, this is the case.

So this bridge once again is providing full view of the impact really of all items so that there is transparency to you, to all related parties, investors and regulators about what is net-net, the debt reduction that this transaction entails.

I have another question, I think, which is, can you please quantify some of the elements in the bridge, mainly minorities and debt adjustment?

So this is what I mentioned. The 3 blocks are not exactly of the same size, but with the biggest of the 3 on the tax and carve-out and separation cost. And I see no more questions, at least on the chat.

Okay. Then question to the operator, any live question left?

There are no more questions on the web -- on the audio call.

All right. Then let me summarize. First of all, thank you very much for your great interest today that led to a lively session. And you think -- I think you could convince yourself that IGNITE is now in full swing, 2 months after we announced it. And from here, the full attention at FORVIA goes into execution. And that happens on 2 levels. We are delivering the year. That's utmost important. And then we drive the Interiors business to transaction close by the end of the year as well.

So thank you very much for your continued interest, and I look forward -- we look forward to talking to you soon. Thank you.

Good morning. This is the conference operator. Welcome, and thank you for joining the Forvia 2026 Q1 Sales Conference Call. [Operator Instructions]

At this time, I would like to turn the conference over to Mr. Martin Fischer, Chief Executive Officer of Forvia. Please go ahead, sir.

Yes. Thank you very much, and good morning, ladies and gentlemen. Thank you for joining us today for our Q1 2026 sales call, which I am presenting, as usual, together with our CFO, Olivier Durand.

I'll start by sharing our first quarter highlights, and then Olivier will walk you through the details of Q1 sales. In the end, I'll wrap up with the outlook for the full year 2026.

So let's get started looking at our 3 strategic priorities. We started executing on our IGNITE program that we presented at CMD and I am pleased to report progress on all 3 priorities that support the plan. So let's start off with performance. In the current situation, our business portfolio proves to be really resilient because we are in a context of declining market volumes across all regions, and we experienced unfavorable customer mix. You'll be seeing from Olivier's presentations how our sales hold up. Also, we continue to manage our business with discipline in terms of fixed cost reduction and offsetting our cost inflation.

Second pillar, transformation. We make further progress when it comes to the interior divestitures, which we expect to materialize in the near future. And also, we expect the metrics of the deal to be in line with what we presented at CMD. You heard about the net debt reduction of EUR 1 billion and a gross debt effect expected to be EUR 1.4 billion. The second one that has been very important over the last months is the attention of the Hella leadership team to the Lighting turnaround, both in terms of top and bottom line, and I will explain more details in just a moment.

Last but not least, invigorating our culture also here, good progress. Our project Simplify is on track. The processes are being streamlined and waste is being taken out. And here, our finance team around Olivier set a strong example by simplifying our reporting week-over-week, month-over-month and by taking unnecessary loops out of our approval processes. Along the same lines, we have also eliminated layers out of our organization, and we optimized the span of control of our leaders.

Last but not least, we also push our new leadership model, Guide, Empower, Recognize. The new management principles and the behaviors that go with it are now being out by leaders that are getting into trainers' roles. So that turns out to be very effective in terms of driving that culture throughout the entire organization. As announced at CMD, we target geographic and customer mix expansion to drive the scale of our strong businesses. And here are some important wins that I want to report out from the first quarter.

Looking at India. Our objective remains to double the sales by 2030 from the EUR 0.45 billion that we had in 2025. And the first very good award to mention in Seating. Remember, we have already been present in selling and building mechanisms in India. And now we have secured the major -- the first major complete seat program with an international OEM in the Chennai region. Also in the Clean Mobility business group, we can report 2 exhaust system wins. One is for a Korean OEM and the second 1 is for Mahindra in India. And the latter one is particularly positive because it's in the commercial vehicle segment. So we have basically a double diversification once into India and again into the commercial vehicle segment as well.

Looking into China, we keep diversifying our customer base with significant orders from 6 major Chinese OEMs and I want to give you a couple of examples. So we secured lighting business with Geely, Seating business with Changan and various businesses in Chery, and Chery is going to take us both for their Chinese operations and their new operations in Spain. In fact, we just signed another strategic cooperation agreement with Chery that is now expanding the scope of our collaboration also to the Hella businesses of electronics and life cycle solutions.

Third column here, let's focus on the product side. We scored with interior monitoring systems, which we explained to be an important element of our in-cabin electronics and therefore, belongs to our 3 growth drivers in Electronics. So here, we secured 2 contracts, both for a major OEM in Europe and another 1 in the United States. So I can state IGNITE is on the move and the growth drivers that we presented at the CMD started to materialize in the quarter 1 order intake.

Let's have a look at the transformation program in Lighting. Hella Forvia is and remains the undisputed tech leader in the complete product range. However, the organic sales declined by around 7% in Q1 2026, extending the trend that was observed since H2 2024. And this development has obviously implications on profitability as well. The transformation program that we started is now under implementation with the new management. You got to know Peter Laier, the new Hella CEO during CMD and Juan Mollá joined as the new management board member in charge of Lighting since March 1. He comes in with a broad experience in automotive lighting and put that to work right away.

The program that he is pursuing is built on 2 pillars. We want to drive top-line growth and that is enabled by streamlining our cost base. So first of all, we can leverage our premium tech position. And then we reposition the business to address the volume segment and to further diversify the client base. All this is, as I said, strongly enabled through a performance plan that optimizes both the R&D costs and the plant performance. We had -- in Q1 already, again, we reported out also for Q4 last year. We had, again, key awards for Headlamp packages. And these are reflective of mass market models, both in the United States and in Europe as well as for Geely. So we can confirm the effectiveness of the approach already through these order intakes.

We will be seeing a progressive recovery across the business and beginning with H2 2026, we'll also see that in the bottom line. Today is, in fact, the first time that we structure our actual numbers into growth and value clusters. And I just want to briefly remind you, what we have done, we structured the portfolio into growth and value divisions. So on the growth side, we have Electronics and Seating. Remember, those are well growing market segments, and we have strong positions with a good right to win.

So for Electronics and Seating, the priorities are to lead through technology, intensify the growth through diversifying the customer base and work with partners to also push growth forward. So on that side, we are ready to invest in a disciplined manner. And then on the other hand, there's a good complement in the value cluster, where we collect Clean Mobility, Life Cycle Solutions, Lighting and Clarion, and the focus clearly goes towards performance, cash and value generation. So Clean Mobility, Life Cycle Solutions remain to stand for an outstanding cash quality. And with Lighting and Clarion, we are in turnarounds with subsequent growth opportunities. So again, this segmentation gives us clarity and focus for our future capital allocation and therefore, also for an optimized value creation.

So with this structure in mind, I would like to hand over to Olivier for the Q1 sales presentation.

Thank you, Martin, and good morning to everyone. In the next few minutes, I will show you the main Q1 performance takeaways. But let me start by a reminder that all the numbers that we are showing are under the application of the IFRS 5 accounting standard, which is requiring, in fact, the reclassification of interior as discontinued activity given the planned divestiture that we are into. So consequently, the Q1 sales that we are showing, whether it is for '25 retrospectively or '26, are presented without interiors.

Moving to the numbers themselves. We report first quarter sales of EUR 5.135 billion. This is fully in line with our full year guidance of EUR 20 billion to EUR 21 billion at constant exchange rates and is confirming a solid start of the year. The Q1 numbers include a significant ForEx exchange headwind of 4.3%, which is primarily driven by the depreciation of the U.S. dollar, the renminbi and the yen compared to Q1 '25. Now we expect, given the evolution of exchange rates that those currency effects will ease significantly in the second quarter. And let me remind you that, in fact, our business operates basically locally. We buy and sell basically in the same currencies. So therefore, changes in currencies have very limited impact on margin.

Now on an organic basis, sales have been lowered by 2.2%, which compares favorably to the underlying automotive market volume, which has been estimated to be down by 3.4% with the major regions impacting contraction. So in short, we have achieved an outperformance of 120 basis points in the first quarter.

Now looking at the performance by region. Forvia delivered growth and outperformance across all geographies with the exception of China. In Europe, our growth was primarily driven by Electronics, Clarion and Clean Mobility, reflecting both solid commercial momentum and a favorable product mix. In North America, we also recorded strong dynamics, particularly in Electronics and Clean Mobility given the evolution in terms of electrification. Asia presents a more contrasted picture. On the one hand, in China, we recorded an underperformance of 14 points versus market volume, primarily driven by our customer mix with the 30% decline of BYD production. BYD volumes are expected to stabilize from the second quarter. And we have already taken the necessary measures to adapt our cost base and protect our performance in the country, and we continue the diversification of our presence in China.

On the other hand, we continue to expand in the rest of these big regions with an increase of 11 points year-on-year, supported by a very solid quarter in Electronics and Clarion and to a lesser extent, in Seating. As you know, we have big ambition in the region, in particular with the development of India.

Now I will move, in fact, to the performance by businesses starting with the growth cluster. As Martin mentioned earlier, the group strategy is now built around 2 clusters with a different capital allocation accordingly, value and growth. We have updated, as a consequence, our presentation of sales and you will see in the final sales in the semiannual and annual results, also the totality of the presentation adjusted for this.

Hella Electronics and Clarion are no longer reported as a single segment, given the different approach taken for the different parts of the business. The Hella Electronics business has been allocated to the growth cluster and named Electronics; Clarion has been allocated to the value cluster and will be shown in the next page. So now on the growth cluster, as throughout '25, Electronics remain a key growth driver for the group in Q1, delivering 8.2% organic growth, i.e., more than 10% outperformance versus the market, well balanced across Europe, North America and Asia. Performance was driven by radar sensors, energy management components and low voltage management systems.

Looking at Seatings. The organic sales decline of 11%, which was expected, was essentially driven by the unfavorable customer mix in China that I mentioned earlier. We expect a gradual improvement over the year. In all, the organic evolution of this cluster, which stood at 5.8% negative in Q1, will also improve in the next quarter given the evolution in Seating and the continuation of the growth in Electronics.

Moving on to Value cluster. Sales increased by 2.1% in the quarter on an organic basis, which is a good performance, clearly compared to market volume, which I remind you, were lower in Q1. Our 2 strong cash contributors, Clean Mobility and Life Cycle Solutions both delivered a solid start of the year. Clean Mobility continued to benefit from renewed opportunities in the ICE segment in North America as well as the ongoing ramp-up of a business takeover that we did last year in Europe, which annualized in the second quarter. Life Cycle Solutions delivered strong growth driven by solid performance in specialty original equipment markets, notably in trucks, buses and agriculture. Activity was also supported by the expansion of its spare parts offering to the thermal management business.

Looking at the 2 other activities, we have a mixed picture. Lighting recorded a sales decline of 7.3% organically in Q1 as the business continues to reposition its product offering and strengthen its competitiveness to return to growth as highlighted by Martin earlier on. Conversely, Clarion recorded a major double-digit growth across all regions, primarily driven by Japanese OEMs.

Now let me go a bit further on the progress of our interior divestiture. As Martin alluded to, discussion with several buyers for the sale of our interior business have kept progressing with terms fully in line with what we shared and committed at the CMD. We confirm an expected net debt reduction of at least EUR 1 billion. And given the cash position of certain subsidiary within this business group, and the simplification from the cash management that this operation will entail, we expect the gross debt reduction actually to exceed EUR 1.4 billion. And this is the relevant metric when we consider the reduction in financial costs because it will allow to eliminate, in fact, gross debt at this level.

On a run rate basis, we expect the transaction to allow a reduction of EUR 50 million to EUR 70 million in financial expenses on an annual basis, i.e., starting from next year. Combined with the expected organic cash flow generation in '26, we expect the net debt reduction to get to a situation of EUR 4.5 billion at year-end, i.e., a reduction year-on-year of EUR 1.5 billion. This will support the restoration of the Forvia financial structure with a leverage ratio at 1.5x at the end of the year i.e., a division of the leverage by 2 compared to the time of the acquisition and the same in terms of net debt evolution.

And on this note, I turn back to Martin.

Thank you, Olivier. So let's look forward into 2026. I mean in the context of Middle East crisis, it is clear that we face uncertainties and uncertainties on volumes as well. So it is difficult to fully assess the impact for the full year. At this point in time, it is positive that the customer call-offs are stable. We saw the recent downgrade from S&P where they have taken global automotive production down to 700 -- 91.4 million. That's a delta of 750,000 vehicles in the year and the declines are expected across all key production regions: Europe, North America and China. It is important in spite of this expected softening, we confirm our 2026 sales guidance. And we continue to carefully monitor the development and are fully prepared with mitigation strategies for various scenarios.

What really matters to me is that we have all measures in place to also offset cost inflation. First of all, we have limited direct exposure to inflationary pressures. For example, our energy costs are at 1% of sales. That's primarily on power on electricity and we are hedged at more than 70% for the year 2026. Raw material price increases are contained with contractual indexation mechanisms and as in all the other crises and inflationary situations of the past years, we have the objective to fully mitigate cost increases through, on the one hand, supply chain optimizations and then, on the other hand, through pass-through of any remaining cost effects to our customers.

In any case, we proactively strengthen our cost position. So when you look at the key programs, EU Forward and Simplify, both of them are on track and we expect incremental savings of EUR 110 million in 2026. Also, we cut additional indirect costs and maximize our cost flexing measures. That's important to be prepared for possible volume decline. And last but not least, once more, I would like to also refer to our Lighting turnaround plan.

So when we take these developments in account, I'm very confident in confirming our 2026 guidance. Q1 has been in line with our expectations, and we have strongly mobilized our organization to mitigate the effects in the current environment. So therefore, we remain to look at sales of EUR 20 billion to EUR 21 billion at constant exchange rates. Our operating margin is going to be between 6% and 6.5% for the full year. We expect net cash flow of at least 3.0%. And as Olivier explained, the leverage ratio will land at 1.5x before and after a possible divestiture of interior.

So thank you very much. And now we are happy to take your questions.

[Operator Instructions] The first question comes from Christoph Laskawi of Deutsche Bank.

The first one is just a clarification question on your comments on interior. So I assume you don't want to be more precise what the near future means assuming it's the next couple of months. You are expecting the cash in for the transaction also to happen in '26, right? If you just could confirm that. And then the second question would be just on Seating. Obviously, that led to the Growth cluster not growing in Q1. And you already indicated that the next quarters will improve. Could you be more precise in a sense that when do you expect that to turn back or return to organic growth. Obviously, the comp base gets far easier in the quarters ahead. But are there any like milestones, SOPs or so that would drive it up to organic growth and potentially also stronger outperformance that you can flag already today?

Christoph, thanks for the 2 questions. So let me start with interiors. You see we obviously take the time needed to conclude those discussions in our best interest. And yes, near term, we are not going to qualify any further, but I dare to say it's not months and months anymore. And when it comes to the cash intake, yes, we still expect that to go into the numbers of 2026. So the debt reductions that Olivier showed are expected to happen within this fiscal year framework 2026.

Then when it comes to the Seating growth, yes, the current weakness is due to predominantly the customer mix in China. BYD sales are down by about 30% and this being our biggest customer in China, has an impact, and that's why we don't see growth right now in Seating. Your question targets in the right direction, how is that going to change going forward? So we have secured in the meantime, quite a few new orders for Seating and a number of them is going to launch already in H2 this year. And a number of them is also with BYD because with BYD through our strong partnership, we always have agreed on a share of their book of business and seats. So we are compensating what is missing. And here's really interesting launches coming because you know that BYD is bringing up new battery technology. And we are going to be on models in H2 like the DENZA D9, the Song Plus that comes with the new battery technology for ultra-long range and ultrafast charging. So this will help us to bring Seating back to growth.

[Operator Instructions] Gentlemen, at this time, there are no questions on the conference call.

Good. If no other questions, then I would like to thank you -- sorry, we have a question on the chat too, then we go for that one.

Let me read. It's coming from Ross McDonald, and there are 3 questions. The first question, the organic decline in the Growth cluster of minus 5.8% in Q1 '26 was well flagged on BYD headwinds in Seating. But how should we think about the organic growth for this cluster for the full year? Is there a reported revenue number we should think about as a target for '26 baked into the '26 guidance?

Question 2, given the economic uncertainty and given your guidance assumes no further deterioration in the macroeconomic environment, are you able to give some sensitivity to the full year guidance if we see further LVP reduction? What will it take on the volume side to take us to the low end of the '26 guidance corridor and at what level of volumes will take us below the current guidance corridor on sales and margin.

The third question, can you comment on the recent business wins with Chery and Geely. Are these skewed toward your growth segment in Electronics and Seating. How should we think about the overall magnitude of these business wins from a euro value order bank perspective?

Good. Ross, I'm not sure you're listening, good morning in any case. And I would start then from the business side and the order intakes in China. So you heard me talk about new Chery businesses. And yes, that is part of the new collaboration agreement we have with Chery that we are now picking up Electronics sales there. Then we talked about new businesses also in the Seating area, Again, they are not only with BYD, but particularly important to mention that we have business coming up here with Changan as well. So yes, we are picking businesses into our Growth cluster. How to quantify them? Every single deal in these businesses, you can consider a couple of hundred million in lifetime sales, and then this has to be accommodated obviously. Maybe, Olivier, you take the question on the sales guidance and the sensitivity around that.

Happy to. So first off, I would like to say that we are currently, in fact, in the favorable side of our guidance from a revenue standpoint as we speak for the year. So let's say that it gives a certain margin of maneuver on the revenue side in the guidance. The calculation is then fairly easy to do in terms of sensitivity from a revenue standpoint versus evolution of the market. Let me complement that by the fact that in Q1, we have not seen particularly any, in fact, headwinds on the revenue standpoint. Actually, the month of March was, in fact, even a bit better than what we anticipated before. And that EDI so far in Q2 are not showing any major evolution.

But having said that, we are applying to this volatility, uncertainty, in fact, what we did in previous crisis, and I would like in particular to highlight what we did in the case of the tariffs. Two topics were existing, and they are the same here. One is inflation effect because tariff is inflation. And the second was the risk of volume decline. On the inflation, we did that last time, we are doing the same. We are doing the maximum on our side in terms of what we can do to mitigate, in fact, those elements. We have done hedging on electricity. We are looking at the options in terms of the raw material, but we complement that with pass-through in fact, of this inflation to customers. And they are, in fact, formalized for a lot of it, and it will be completed with the necessary negotiation. You remember that we recovered in tariffs more than 80%. I think it's basically the type of goal that we have for this evolution as well.

Related to volume uncertainty and risk of volume drop, we have put in place what is necessary in terms of discretionary spending, cost base and flexing the cost to face that if and when it's materialized. Now we -- so we confirm the guidance, and we confirm also that given where we are in terms of our revenues, we have a certain flexibility in case the -- actually, the volume of production is getting lower.

Thank you, Olivier. And then last question was on how are we going to return to Growth in the Growth cluster. And indeed, we are very confident so Growth in the Growth cluster over time.

And that's where we already did 8% growth in that quarter in Electronics in a declining market. And in Seating, which is penalized by the specific situation in China is expected to restore growth gradually as well in the first step with these new launches I quoted.

Excuse me, Mr. Fischer, would you like to take a question from the conference call?

Yes, absolutely.

We do have Stephen Reitman of Bernstein.

Yes. Two questions, please, about China in China and also the Chinese manufacturers progress in Europe. First of all, in China, could you comment again on what you're seeing in terms of payment terms from some of the key customers, in particular, BYD? And if the pressure on them to make more reasonable payment terms, are actually being -- there's some visibility on that? And secondly, on your exposure to the Chinese with their plans in Europe as well. Obviously, you've talked in past about BYD. Obviously, we've seen in March, the Chinese getting to about a 9.4% share of the overall market, about almost 150,000 sales apparently according to the data from Dataforce. So I just really want to see what's -- how -- how you think about your exposure to as the Chinese expand in Europe as well as their local operations.

Stephen, very good questions around China here. So we don't see any change on the payment terms with our Chinese customers on an average. And we remain in the same position that we mirror those terms also with our supply base. So now no change in any of our working capital effects, therefore. And when it comes to the second question around exposure to the Chinese customers selling in Europe. So first of all, we see that a good part of these volumes still arrive from China in the form of vehicles. And we are positioned with, as you know, more than 20% of our sales -- global sales in China and a good portion of that goes with the Chinese OEMs. So when they export vehicles, we benefit from that. And then the second trend has certainly started with the Chinese OEMs starting shops in Europe. And here, we are clearly partnering with BYD in Hungary, with Leapmotor and Chery in Spain. So we will be localizing our production then to also give them local content here in Europe.

And from a cost perspective, I mean, how easy is it to approach the levels that they require. Obviously, what they're used to in China and obviously, how they can be supplied from a European cost base even in a low-cost location like Hungary or another from other Central or East European plants?

Yes. No, good follow-up. And I mean both OEMs and suppliers face different cost bases in China and in Europe. When we are deeply localized in China, that is at a level that we cannot attain, not for the vehicle, not for components in Europe. And in the whole local content discussion that we also have politically you could see numbers that were also published through our trade associations. But depending on the product, on the commodity, there can be cost differences between 15% and 30%, when you go deeply localized China versus deeply localized Europe.

In fact, Martin, there are quite a few questions on the chat.

There is one question from Tom Gibney. with respect to raw material cost, what proportion of your raw material cost is represented by plastics and aluminum respectively? And second part of the question, what proportion of plastics and aluminum cost are covered by contractual pass-through and what is the average delay of this passthrough clauses? And I take the question, I will take the answer.

So, we are not buying aluminum. But we are -- of course, we are buying some plastics, I think to the tune of EUR 1.4 billion, and they are largely covered by contractual passthrough. Those passthrough clauses have -- in fact, they are based on smoothing average. So there is a bit of a delay in the recovery when you have an increase of the cost and vice versa in the opposite direction. The goal is clearly to ensure that we have the passthrough in full and happening during the year. It means it is the type of seasonality participating also in the type of seasonality between H1 and H2 EBIT that you see traditionally within the company.

Yes. And Olivier, I want to reiterate that this is a well-oiled machine in the meantime after the various waves of inflation on semiconductors general inflation. So we have our systems in place to determine how are we being influenced -- impacted by these increases. We have dual sourcing here and there. So we can mitigate as much as possible between suppliers. Then we have the automatic price escalators with the customers. And then the last step is if this is not all protecting us individual negotiations on the remaining effects with our customers. So I trust that mechanism. We showed it very well last year also in the context of tariffs, and that's why we can reconfirm our guidance also in light of these negative factors.

Two questions from José Asumendi. First question, can you talk about growth opportunities with Chinese OEMs in Europe. And the second question, in light of the headwinds we are seeing in H1, are you planning to increase the cost savings speed in Europe? Can you comment on the restructuring costs, the restructuring work done in the Lighting business specifically?

José, good questions. So let's talk about growth opportunities in Europe of the Chinese OEMs. I mentioned a couple of them already. And I want to even extend the answer. It's not only growth opportunities with the Chinese OEMs in Europe, but also in South Africa and South America, you saw quite a few of the announcements where the Chinese OEMs are going to tap into markets by taking over existing production facilities from more traditional OEMs in these regions. You can fairly assume that we are on all these business opportunities around the globe with the Chinese OEMs because we see the strong expansion. We have that strong foothold in China. So it's a natural to benefit from their expansion globally.

And on the cost savings streams, yes, we are accelerating. So we have started a new resilience program in light of the Middle East conflict where all businesses, all functions first of all, generated additional savings ideas, and we put them in action before we even see the actual volume decline to really drive our results cautiously, carefully on the safe side for what might occur in H2. And for the lighting program, yes, it's a very comprehensive restructuring plan that we run. And it has to do both with taking costs out of operations. So Lighting is a strong contributor to the EU Forward Program in that sense, but it has also to do with taking costs out of product. So we work into the design of the products and I mentioned that we are successfully now for 3 quarters of the year, taking volume orders in because we can project the future product costs and also the future cost base in operations into these offers and into these new orders.

Another question on the chat from Stephen Benhamou. One question, please. Debt maturity, can you please give us an update on your refinancing plan for '27 as you have EUR 1.9 billion of debt maturing next year? How do you manage the refinancing risk given higher interest rates?

So on this question, so the -- you have 2 parts. You have a bond in Hella, which is maturing January '27. And we expect to refinance a part of it, and we will do that in due time. No particular rush on this one, especially given the current interest rates. In relation, let's say, more to the Forvia debt. Clearly speaking, the proceeds from the divestiture of interior will be about reimbursing quite a bit of this one. We will work on depending on the evolution of interest rates and so on, which part would be on '27 and which part will be on '28 and on the remaining part, we will look at refinancing options. Don't -- let's not forget that on top of the divestiture, we have cash flow generation in the company plus our actions in terms of cash repatriation and optimization, which allows us, in fact, to have capacity to re-onboard gross debt beyond the pure cash flow generation.

So limited refinancing activity, I would say, this year.

There is another question from Floris Dykstra. Are you able to comment on the latest made-in-Europe rules and how they may impact your business? There was news that European OEMs may be partnering with Chinese EV producers in European plants. Will this improve volume positively regards for us?

Good. Let's comment first, Floris, on your question with regard to local content rules. So the proposal of the European Commission is out. And yes, it's direct a significant share of local content into vehicles here. Europe is our home turf. So that's obviously strengthening us and also backing us up because it will secure production of components for European vehicles in Europe. So we can trust that volumes do not collapse because the world has decided to benefit from other countries, cost structures like China. We discussed the cost difference. So it's a positive element of our future because it secures the employment of all our associates here in Europe, much better than without that regulation.

And the second part of the question, Olivier, went in the direction.

So the question is about European OEMs partnering with Chinese EV producer in European plants. I think the question is, will this improve volume for us?

Yes. No, it's a trend that we obviously can benefit from both through the good relationship with our established customers here in Europe. And one example being Stellantis and Leapmotor where, yes, we do traditionally, a lot of business with Stellantis, and we have also grown nicely in China with Leapmotor, and we grow with Leapmotor coming to Europe as well. So that is a trend that can be seen as an opportunity since the market mix changes from more of the traditional OEMs to Chinese OEMs as well. We will make benefits and use from them entering facilities or partnerships with our European customers.

I don't see any outstanding question on the chat. So I don't know if there are outstanding questions on the call.

No, sir, I confirm that we have no questions registered at this time.

Good. Then I want to thank all participants this morning with a very quick summary. You saw we took a solid start into Q1 in spite of the customer mix issues in China. We were outperforming the market, which is a good start again. We are well prepared to counter any effects that might come from the Middle East crisis. And we have a full focus, as you see on the execution of all elements of our IGNITE plan. So Forvia is on track. We are running. I look forward to the next months. I want to thank the global Forvia teams of what has already happened in Q1, and we're going to perform as per the guidance that we just reconfirmed. Thanks, everyone. Bye-bye.

Thank you.

Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your devices.

Good morning, ladies and gentlemen. Welcome to our 2025 results call and the CMD, together with our CFO, Olivier Durand. We are very glad to receive you and many thanks for -- those of you who took the chance and came to our headquarters here in obviously much more lively with you as an audience here. Thank you for that.

So when I started last year, I gave a commitment, right? I said Capital Markets Day will be my first year, and here we are going. We are coming to the end of that first year at the helm of FORVIA. And I'm very glad we chose that timing for the day, because we are here to, first of all, discuss our 2025 results. And I think it is important to look at those and for you to convince yourselves about the performance capability that we have. And any talk about strategy in the future, it's going to be well grounded in that delivery from 2025.

So let's start with the results. We will have first the highlights. I'll give you that part of the presentation, then hand over to you, Olivier, for the financial results. I'll do the '26 outlook after that. And then we go into the first session for Q&A. So that's your part. Then we'll have later on a second one also for the CMD.

So the year started with setting 3 priorities for ourselves. And I will leave you the financial community know them as much as everybody and FORVIA right now. It's about performance, and there is increasing NOI and cash flow, helping the organic deleveraging. It's about transformation.

We're going to talk a lot today about our portfolio during the CMD and how we want to sharpen and focus that. We're also going to talk under transformation about our intended Interiors divestiture. So there is clear decisions we are taking on the portfolio. That also has financial implications that I'm going to talk about.

And last not least, culture. It's about our operating model that we push into a new league. We are going for empowerment and accountability of our tubes, and this has been showing already through a refreshed organization, a new leadership principles that we have been cultivating. And last not least, we informed about Simplify mid of last year. That program now is in full swing. So with that, let's look into our numbers.

So first of all, very good news. All 2025 numbers are in line or above the guidance that we shared with you. So we have flat organic sales at EUR 27 billion when you look at constant ForEx and it was, in fact, EUR 26.2 billion at the actual exchange rates.

Operating margin is up 40 basis points. So we have delivered 5.6% and one has to qualify that because that happened all with quite a bit of headwinds in the market. So tariffs hit last year. We compensated for them. Electronic shortages from Nexperia now on the DRAM side, it happened. We compensated for that.

So our first year was really characterized by a strong effort of all the global teams to offset what was against us and to deliver beyond. We have initiatives in place to help that to EU forward. We are now at 6,400 agreed departures from FORVIA by the end of 2025. So pretty much 2/3 into the whole program where we envision 10,000 departures by the year 2028. You can see how we frontload that.

Cash flow plus 47% versus 2024. We ended up at EUR 962 million, and all that it is a much better quality. So Olivier is going to report out on that. So less of an impact from working capital, but really fundamental savings and CapEx approaches that helped this big increase in cash.

With that and the increased EBITDA. We are now at a leverage factor of 1.7x. Remember, we guided to 1.8x. So that turned out better. And with that, we could also reduce our net debt further than anticipated. We are now standing at around about EUR 6 billion. So that's EUR 600 million down from last year.

And I want to really emphasize this is organic deleveraging, and it's good to see that we go the 0.3x, and that's the direction. We are now very confident that in a given year, we can do 0.15, 0.2x of organic deleveraging. So I want to, first of all, thank the FORVIA global teams for these results. Thanks for having accepted me as a new CEO. And thanks, we could run so fast together. That's really encouraging.

So let's get back to the portfolio briefly. You will hear about how we structure the future. We are grow fields. We are going to declare that. And the kind of portfolio rationalization that goes along with it and that transformation including the Interiors divestitures that we intend to do leads to some impairments we had to do.

So we do have net cash impairments that impact our net result. So through that, we are looking at a net loss of EUR 2.1 billion. So by no means, am I easy going about announcing that, but I'm equally confident that with the sharpening and the focus of our portfolio, we prepare for a much better value creation in the future for FORVIA.

So last point on this slide is our net loss that we incurred and our continued focus on deleveraging leads the Board to a recommendation to the general assembly that comes later this spring not to pay a dividend for the prior year. So all in all, good operational performance, and you will hear more about the noncash effects we see in the net results.

Let's go order intake next. So we have EUR 27 billion plus of new orders taken in with lower upfront costs than in prior years. I'm not completely satisfied with that number in itself, and we are developing a very strong push and initiative for 2026 to bring order intake numbers higher again.

At the same time, the structure is very important. The structure of the new orders and is a very healthy in various regards. So you see from this chart that 34% of our new orders are coming from Asia and 23% of the global orders from Chinese OEMs. So both numbers are above our current shares in business. So you can understand how we grow in Asia and particularly again with the Chinese OEMs.

Actually, in China, we have had record order intake of EUR 8 billion, and thereof 80% are with Chinese OEMs. So we're well tracked. We've even advanced our trend to be strong with the local OEMs in comparison to the play that the international OEMs have in China.

Also, we picked up new customers in China. So we went beyond our strengths with BYD, Chery, Syk and others. We have now booked significant business with Geely with. That's a premium brand between Chery and Huawei. And also, we are now working with a new auto player coming from the tech field, who builds amazing vehicles and has chosen FORVIA as being a supply partner. So that's good.

The other fields, that's the third graph here, I want to stress is our order intake in the electronics space. So 28% of orders come from electronics, also quite a bit ahead of our current sales levels. And here's a couple of really prime products that we will focus on during CMD. Zone modules being one of them. This defines the new architectures for the software-defined vehicles and we took in orders more than EUR 1 billion for that product.

You'll hear about that in detail during the CMD. Last not least, you know that happening is spearheading our software technology and software efforts. Those are the in-vehicle app stores we do. We onboarded more apps to that. So YouTube and Zoom is now available for passengers in the vehicle through the FORVIA app App Store. And also, we could win new Chinese customers to use our technology there.

Technology and innovation, it is, right? That's at the core of FORVIA, we have technology leadership, and that drives our growth. Therefore, I'm very happy to share another couple of examples of businesses that we took in this year and that we industrialize and bring to SOP. So we have significant wins in the area of the software-defined vehicle. Again, here's that zonal module that you'll hear about it as a really attractive piece of business because it starts from a proprietary chip that FORVIA HELLA has developed, and then it integrates with the hardware and the software on top.

So we are going to see start of production in 2028 for that. If we go to the comfort and safety space, Lighting has brought up a new product, highly interesting. We call us floodlights. So you know all the little signal lights and for daytime running lights or the turn indicator that used to be some LED modules of certain sites.

For our floodlights, we now use microoptics and we could reduce the size significantly. So what used to be a 40-millimeter little element in your head lamps now 5 million thick only. We save 80% of weight and 40% of the energy through that technology. That's the world first coming from for FORVIA HELLA, and that creates a very nice revenue pool for us going forward.

On the Seating side, here, we'll have a deep dive today, I can announce that already. We have launched Zen Massage Seat. What is that? For the Asian taste, the typical European pneumatic massage is a little soft and we have developed a mechanical massage. And the important and impressive piece of uses, we introduced that first time in the Shanghai Auto Show last April, and we are now launching the product.

So from a concept and a demonstrator to SOP, that's moving in 1 year only. So China sets the pace and FORVIA has the right speed to work to that pace. And last not least, Clean Mobility is also moving on technologically. You know that the highest internal combustion engines has a prolonged lifetime. You see that particularly in North America, but there's also technological evolution we are driving.

So in particular, when it comes to hybrid vehicles and range extenders, there are special requirements to the exhaust systems. First of all, they have to be pretty compact. Of course, with the batteries and a range extender vehicle, there's only so much space in the vehicle, though we work towards that.

And secondly, these exhaust systems have to be super silencing. If you happen to drive a hybrid vehicle, it can be annoying when you go from electric mode into crusher mode, you hear that, right? So we want to dampen down all the noise from vibrations from the exhaust as much as we can.

So we see technology all over the brand. And the good thing is with those products you see here, it's always new revenue and profit pools that we open up to the world's first real innovative technology. A word on interiors. So this is part of the transformation, and we have made a very clear decision that we want to divest from the Interiors business.

Current progress that we are in advanced negotiations with several parties on the divestiture of that business. So first of all, the business is very solid. It's a EUR 4.8 billion business. We have about 60 plants engaged. We have 31,000 people. And we have a world-leading position in that business. So why sell?

Basically, at the same time, the business is fairly capital intense. It's not growing so much, and it's a mature market and fragmented market that we face. And therefore, we came to the decision that there must be better and more dedicated ownership to lead that business into the future whereas FORVIA can focus on our high-tech growth fields. Plus, it's very obvious that the divestiture brings us new financial flexibility and helps us bring the net debt down. So more financial details on that and on the results from Olivier. I hand over to you, Olivier.

Thank you, Martin, and good morning, everyone. So in the next few minutes, I will give more details on the financial performance of '25. But let me start with an accounting consequence of the advanced status of the Interior transaction that Martin just mentioned. We are applying the IFRS 5 accounting ruling, which is saying that you should present, in fact, your results, pro forma of the actual sale of Interior. So inside the financial report that is available actually in this room, you will see '24, '25 after this operation. So all operating metrics, sales, margin, cash flow will be, in fact, result interiors and everything reported in one line of the P&L and of the net debt evolution. .

However, for the clarity of the presentation of the '25 results on the current perimeter on which we are, we present all the numbers before so that you can compare apple-to-apple. One exception, of course, is the net income because there is only one net income, and I will come to this one. '26 will be on the new perimeter and the guidance that -- an outlook that Martin will share will be on the new perimeter with the comparison of '25 after the sale on a pro forma basis.

And one more thing is that the financial report that we are publishing for the transparency, for the clarity for all of us is providing P&L balance sheet cash flow before and after the IFRS 5 application for both '24 and '25. I hope it will help everyone to see the impact of the transaction on all the metrics.

On this note, let me go through the detailed financials. So first of all, as Martin mentioned, flat revenues year-on-year on an organic basis. Let me -- you know that the ForEx is in fact having a negative impact with the decline of the U.S. dollar and the RMB. This has been the case most of the year, and you see the impact inside those numbers for close to EUR 800 million.

Let me highlight that ForEx have in fact, no impact on the operating margin, basically, we buy and we sell in the same currencies in the big geographies in which we operate China, Europe, North America. Now from an organic flat perspective, let me highlight that product sales actually increased. We are tooling revenues that have normalized from the very high level of '24. So in fact, from a production comparison, you could say that product sales is 1.5% increase.

If I zoom by business groups, you have electronics, which is a major growth engine. We increased by 12% year-on-year on this segment. We have Clean Mobility rebounding in the second half. This is both the evolution of electrification in some of the geographies as you know, but there is also the gain of market share that we have enjoyed in Europe.

Lifecycle is also rebounding. Now on the more negative side, you have clearly seating evolution. So Seating is, in fact, currently penalized by the mix between Chinese OEM. You know that we enjoy a strong position with BYD, and we are happy to.

But clearly, in the mix of last year, Geely has been growing faster, and we are less present with Geely. We have the continuation of diversification in terms of between the Chinese OEM. Martin mentioned the level of orders that we have with Chinese OEM.

And you know that also in China, things can go fast. So we have currently less favorable mix in China, but that can evolve. The last element I would like to mention is that profitability-wise, China is still enjoying a double-digit operating margin, thanks to their cost action.

Last but not least, Lighting, you have a respect of repositioning that is ongoing with end of production of some programs, not much by new ones. And for those that have followed HELLA yesterday, this is driving the evolution of HELLA. The mix by geographies. So I mentioned quite a bit about China, which is the mix between, in fact, BYD, Li Auto on one side that are strong customers for us that have, in fact, had a reduction of production in the second half.

We have strong momentum with Chery, and we have progressively growing presence with Geely, but from a low base. On the other geographies, Europe and North America, which represent, in fact, 70% of our revenues are along the market, and we have overperformance in South America and even more important in the rest of Asia, which is one growing field, in fact, in which we have a lower presence and penetration than the rest of the world, but we will talk about how to expand in this region during the CMD part of the presentation.

From a profitability standpoint, we have an improvement of the margin by 40 basis points. This is coming from cost reductions. The revenues are flat. You see the evolution EUR 273 million of cost reduction flowing to the P&L in '25. This is mostly about the EU-FORWARD action that we launched beginning of '24 on which the progress is quite fast. This is also the synergies with HELLA, another EUR 63 million for a total since the start of EUR 400 million and other actions as well as, in fact, the launch of the Simplify project, which we did in the summer of last year, which is about having overheads in SG&A and in operations at the benchmark of the competition by '28, which is also starting to contribute.

So a solid evolution in the operating margin. All business groups except lighting, have contributed to this evolution. You see the main elements, Electronics, 140 basis points, Seating even with a lower level of sales and China has been able to increase by 70 basis points. And you see also that Clean Mobility continue, in fact, to progress. And I will say the lifeline, the duration and the value of Clean Mobility given the evolution of electrification is only actually growing. The Lighting. This is, in fact, the main item that we have to turn around after the sale of Interior that will be, in fact, the sole one to look after really from this standpoint.

Cash flow. So we are at close to EUR 1 billion of net cash flow in '25. This is 47% increase year-on-year. This is also not only an improvement in quantity but in quality. The driver is clearly the level of investment. We have reduced investment from 7.5% to 6% of the revenues. And here, I'm talking about CapEx and capitalized R&D. And this means EUR 400 million reduction year-on-year. Actually EUR 600 million in 2 years.

So you see in the graph that we are showing what we try to call the recurring net cash flow. Let me explain what it is. It is the net cash flow with the exclusion of 2 lines, working capital, which is not repetitive per se, as we all know. And what is inside the line other operational, which are more one-off elements that are not recurring in nature.

You see that we have now a net cash flow that is dominantly on recurring aspect coming from increase of EBITDA, thanks to the increase in operating margin and the reduction of the investment. And this is done with still a high level of financial cost and restructuring. So it's a good evolution.

We took the opportunity also to reduce the factoring inside these numbers. You see that we are going from EUR 1.3 billion to EUR 1.2 billion. And I think everybody should take that as a sign of cost confidence and good evolution. You know also that rating agencies are retreating these items. So I think it's important also to signal that for our debt investors.

If you look in the details of the numbers, you see that we have financial costs that start to decrease, EUR 46 million down year-on-year. This is with the evolution of the net debt, even with the evolution of early interest rates. You have, in fact, an evolution, which is slightly negative on tax, nothing structural. It's resulting tax refund and dividends for HELLA, which are depending on the dividend themselves. So nothing particular.

And I will come back -- we will come back in '26 about the restructuring because the restructuring from a P&L standpoint is peaking in '25, but from a cash perspective, we'll peak in '26. So you will see that the evolution in the guidance is mainly driven by the evolution of implementation of our actions, EU-FORWARD and Simplify, which increased the restructuring by around EUR 100 million year-on-year. But in short, close to EUR 1 billion of net cash flow in '25.

Coming back to the Interior divestiture, maybe additional color of what it means for the profile of the company. It means a more focused portfolio, a simpler organization. This is close to EUR 5 billion in revenues. So we are showing you here '25 before and after, in fact, the pro forma presentation of Interior being out.

You see that Interior being dilutive, it represents, in fact, an improvement of the quality of earnings of the company from 5.6% to 6% for the '25 results. And actually, it will also below the line, Simplify in terms of restructuring costs, in terms of also dividend to joint ventures because this portfolio has a few joint ventures mainly in China.

From a debt perspective, it will lead to a further reduction of the net debt by EUR 1 billion. Let me say a few things about those items, which are clearly questions. In the -- the transaction is a very sizable one. Europe presents a major change of scope for the company. So inside this debt reduction, we have included all the expected impact of the transaction.

In terms of debt adjustment, working capital pension, in terms in a way of leakage coming from joint ventures, when you sell a joint venture in which there is cash, but you sell the 50% or the 60% you have, but you deconsolidate the totality of the cash position.

So here, we are taking the full impact. And this is also something that has led to sizable carve-out and separation and tax cost in order to have the perimeter in position to be transacted. But I would say that in order to assess what is the impact on the financials of the company, the real number you should look at is the gross debt reduction, the EUR 1.4 billion because this is representing, in fact, what will be the impact in terms of future financial cost.

Why is that? We will have, in fact, less joint venture simplification in terms of cash operation. So we believe that, in fact, with this, we are able not only to reduce the net debt, but also to reduce the gross debt and therefore, the financial costs associated. On the P&L, as Martin mentioned, we will have in '25, a net loss of EUR 2.1 billion.

This is driven, in fact, by extraordinary noncash-related charges coming from the portfolio transformation and rationalization. We have EUR 1.8 billion, which are one-off charges and they are all noncash. The first item is we have done the annual impairment test as following, in fact, the strategic review that has been done.

This is leading to 2 impairments for a total of EUR 920 million. The biggest one is related to Clarion for us close to EUR 600 million. And the second one is related to Lighting for EUR 270 million. Clarion is about competitiveness. It's about competitive the portfolio, Lighting, it's at, in fact, the evolution of the activity from a short-term perspective and, in fact, the timing for the turnaround.

The second category of one-off aspect is capital loss on the Interior divestiture for EUR 578 million. Let me highlight that there will be an additional EUR 150 million charge in '26 related to this transaction, which will be the cost at the closing itself. This is captured in our evaluation of net debt reduction of EUR 1 billion, let's be clear. But from an accounting perspective, it can be booked only in '26.

We have the asset depreciation on SYMBIO, which is related to what happened with the joint venture and all the consequences, which is mainly what you saw P&L-wise in H1 and the deferred tax asset assessment, which is a consequence of the impairment.

So really driven by the portfolio portfolio adjustment and the decisions that have been taken on them. Now on the debt maturity profile, as you know, we have been quite active on the debt market in '25, and let me say also in '24.

In 2 years, we have, in fact, refinanced more than half of the debt of the company, of which EUR 2.7 billion in '25, and we have repaid EUR 3.4 billion. As important as what we did in terms of activity is we have diversified our funding sources. Of course, we are in the Eurobond market. Of course, we are in the sunshine market, but we have done some more. We have done a Chinese bank loan, and we -- and the most important of all is that we entered with 2 operations on the U.S. bond market, which is by far the biggest high-yield markets that we have worldwide.

So we have access, and we have presence in all the major source of financing, which is good from a diversification point of view. The consequence of what we did is graphically evident. We have smooth the balance the profile heavily. You see, for instance, 27 divided by 2. For the first time since October. For the first time, since the acquisition, we have a maturity profile that is balanced.

So we are, of course, reducing the debt. We are reducing the gross debt. But as important, we are derisking and clarifying the position and make the company stronger in terms of debt management. This will be further reinforced, of course, by the proceeds of Interior that will be directly in the reduction of the gross debt.

From a leverage ratio perspective, this is what we mentioned before. Reduction of the debt by EUR 600 million. Leverage improved from 2x to 1.7x. And actually, we have done upstreaming of cash in different jurisdictions, so that the reduction in gross debt is actually EUR 900 million.

On this one, we have a clear plan. We did some of it in '25. We have more to do in '26. So you can expect a reduction of the gross cash by a further EUR 500 million in '26, helping the reduction of financial costs, which is, in fact, the objective throughout our plan. And on this note, I refer to Martin.

Olivier, thank you. So let's look a year forward into 2026. Here is our outlook. Let's start with the market first. The auto production forecast is flat to 2025, and we expect to experience some decline in markets that are important for us, such as China, North America, but also in Europe. So we are going to start into a soft year in terms of sales, where, in particular, in the first quarters, we suffered from an unfavorable mix in Europe and in China.

However, we have new launches in the make. So H2 in China, new business goes online. And the rest of Asia remains for us as a very good and a strong momentum. So what does that mean for running FORVIA into this year? Well, we keep to the same priorities and to the same discipline, it's about good cost control. We're going to continue to drive an EU-FORWARD and Simplify is going to pay into the results of 2026.

So when we take that together, we will continue on our route to organic deleveraging. And then as Olivier explained in good detail, the Interiors divestitures will do its part to our gross net debt and then also to the leverage. So here's the numbers that we guide for in 2026.

Reminder, all that is now according to IFRS 5. So we look at sales between EUR 20 billion and EUR 21 billion again at a constant exchange rate. The operating margin is going to be in the range between 6% and 6.5%, and we expect net cash flow to be at least 3% of sales.

With that, we will reach a leverage ratio at 1.5x of EBITDA. When we do the strict comparison to our projection from last year, where we said we will be below 1.5x. We missed that 1 digit, and that's basically due to the ForEx development.

So earnings from North America, earnings from China are not translating into the same EBITDA amount in Europe that holds us back from that. So we target 1.5x strictly this year. So I believe if you see how these numbers also in 2026, they are a very strong foundation for what's going to be our strategic plan. And that's up on the agenda.

But in between, there's a very important agenda item as well, and that's Q&A. And with that one, I would like to hand over to you and look forward to having your questions.

request please focus on '25, '26. I know you'll have many more questions for the strategy, but let's keep that for the second session.

[Operator Instructions]

Tomas Besson. Three questions, please. First, on the organic growth, you're pitching a decline of 3% to 4% organic growth versus flat production in '26. Is there something extraordinary happening in '27, '28 to lift the organic growth in average above 2%. Maybe it's not the right time to ask this question, as you said, but I find it surprising or maybe you can explain just why 2026 organic growth is so weak? .

Second question. I remember Clarion has been at least in the way it was presented before has been part of electronics. Now you're separating it again from electronics. You do a big write-down on these assets. I mean, retroactively, it wasn't great. Is there a lot more to write down on the Clarion and why do you do that? Is there a plan to eventually completely get rid of Clarion for the second question? And the third one on one of the drivers of the '25 cash bid, could you just talk about CapEx and intangible CapEx in '26 and eventually after that, when you've cut that to below 6 or 6. What is a reasonable level? And is it going to be a headwind for free cash flow in '26 and beyond? And can you talk about what's going to happen to capital R&D as well because it's been a headwind to your profitability in '25?

All right. Thomas, thanks very much. It's a bit of a tradition you have in the first question. So let's go through them one by one. Let's start with that organic growth that we see into 2026. So what holds us back is a bit the customer mix, and that's both true for Europe, where we are weaker with Volkswagen and Mercedes than anticipated.

And in China, we have that unfavorable mix in H1 from basically our BYD engagement. At the same time, as I said, we are going to rebound with new launches. And yes, you mentioned the 2% growth. That's what we anticipate for the period of our strategic plan. We are going to talk about it, but we see clearly that recovery for the outer years of that 3-year period you are referring to.

Question #2, that really qualifies for the CMD. What's happening with Clarion, you already anticipate oh, you look at it in 2 ways. We're going to get that back to that. So basically, it's part of the portfolio separation that you'll hear later on, and there's good reasoning about it. Olivier, I would say, give a couple of comments on what's happening there in terms of the impairments, the noncash impairments.

So first of all, all those impairments are on cash, it's impairment of goodwill. The exercise that we are doing is, of course, to evaluate what is the value compared to what we have in the balance sheet. And we have tried to do it in a prudent manner, because the idea is to have 1 shot items in '25, but not in the future.

So this is true for Clarion. This is true for Lighting. Strictly speaking, mechanically, you have no headroom by definition, but we have tried to take prudent assumption. And I would say what we are showing also in terms of metrics going forward should be an indication in this respect.

All right. Then I'm picking up the third question, how is it going with CapEx and capitalized R&D. So you see extremely good values for 2025. That had to do with, yes, we'll work on CapEx, and you'll hear later more about what are the approaches we are taking, but it also had to do with delay of some of the programs. So it's a twofold effect. One is sustainable. The other one with the delayed projects was specific to 2025. So what we target is to keep the combination of capital expenditure and capitalized R&D, clearly below 7% going forward. And you remember, we come from times 8% and an 8.5%. So clearly, below 7% is the guidance there. Olivier, you want to maybe comment also a little bit on the R&D effects?

Yes. So when we talk about this clearly below 7 is and capitalized R&D, so what we can call investments in total. Now specifically on the capitalized R&D. I think the indicator that we are all following is what is the ratio of the R&D that is capitalized. .

You see that it has decreased in '25. And I would say this is a ratio that should be equal or decreasing over time. I think at the end of the day, what we want is true performance and true performance is cash. So I think it's the way to go.

This is also why you see that the improvement in EBITDA year-on-year has been higher than the improvement in operating margin, which is a good thing. So not major changes, but probably the ratio should continue to go down a little bit.

Besides the ratio, you have seen the decrease in terms of R&D spending per se, which is around 10%. Let me comment that on this one, actually, we did not reduce the innovation. So we are not -- it's not about preventing the future is about quality of the costing is about making sure that the projects are executed as defined at the time in terms of R&D spend.

Vanessa Jeffriess from Jefferies. You talked a little bit about the DRAM shortage before. I was wondering if you could talk about impact on margins in 2026.

Yes, that's a good question. So the next semiconductor piece that gets in the way. So first of all, we do use DRAM Clarion site and only on the Clarion business for the infotainment solutions. So the way we go about it is that where we see shortages, we gave for replacement, and we can stabilize the supply to the customers. And wherever we see price increases, that's probably the other part of your question, Vanessa.

We foresee the same way as we have been very successfully last year around the tariffs around Nextperia, we have to forward these cost burdens to our customers and do that in a very consequent manner.

And do you think that's something that will lead to a pronounced second half?

Say that again please.

Second half weighting because of the delay in recovery. Do you think there will be a delay in recovering...

Are we going to see the recovery still in the year? I mean you saw last year's cash performance, and we are always pushing for really timely reimbursements through our customers. And you could see from the cash numbers and the cash flow last year that we are successful in doing so.

So maybe a little bit of time lag in H1, H2 in terms of cash, but not for the year. And the last thing about DRAM is that it's a small topic for us. it's a few tens of millions of purchase. So strictly speaking, this one is -- the goal is to have the impact, but the base is quite small. .

And just it delays in order intake you're seeing, do you expect that to continue throughout this year? And then should we see order intake really move lower each year?

No. I think it's well recovering in the marketplace. So the natural reaction of the OEMs last week -- last year when tariffs hit was to slow down also their new vehicle platforms, right? And then in parts of the market in North America, we saw that slowdown on electric vehicle platforms in particular. I think the market has now successfully reoriented to what regulation and consumers want. So we see a good pipeline of business coming in this year and feels like Clean Mobility is really benefiting from restrengthening, in particular, North America in that segment. Now we see strengthening of the numbers in 2026.

And then maybe this question goes a bit towards the longer term. But if we see from the good news on some local content, can you talk about the impact on your business?

Yes. for us as a global supplier, I mean, we play in all regions, right? And our principle is we want to be local for local, so produce for our European OEMs in Europe. That's the preferred way. And we fully support the direction that you is hopefully going to take in terms of local content mandate.

Yes, we are in a position that we can also supply from other parts of the world if the cost mandates that, but when you think through the whole supply chain structure, it's really imminent that we protect our Tier 2, 3 and 4 suppliers. We got to keep that stable, and that's going to be enabled by local content rules.

So I would say for a big Tier 1 like FORVIA. It is important. We want to produce here. We have a social responsibility for that , but it's even more important for the smaller tier suppliers.

Michael Foundoukidis from ODDO. A couple of questions. First one on the order intake. I mean, you already mentioned it a few minutes ago, but maybe on the Seating. Organic growth was not that good. I don't know about order intake, specifically, but we see some of your peers, especially in the U.S. being more aggressive or at least more vocal about some recent wins, probably some of it at your expense.

So how do you see that in 2026 evolving? That's the first question. Second one on all the, let's say, impairments and one-off that we had from some of your clients recently, there's a debate on the suppliers' compensation. Are you entitled for some of them in 2026? Is it only cash? Or it could be something else. And then more generally, regarding H1 versus H2, you just mentioned of DRAM, but is there something else like the LVP that you mentioned that might explain why H2 should be much stronger than H1 in terms of margin?

All right. Olivier, I'm going to kick the H1, H2 sequencing question over to you, but let's go with order intake first. So as I mentioned, the EUR 27 billion are strong in structure, but they are not to my full satisfaction. And we see a couple of business groups where I would say we got to beef it up and come back stronger in '20 to '26. And that's true for Seating as well. Stay tuned on what we have to tell during the Capital Markets Day on the relevance of our Seating business and how we drive growth.

So that's coming in just a little bit. For the impairments, as we speak, the OEMs have declared that there's obviously canceled electric vehicle platforms, and there's big supplier compensation coming potentially we are not so much exposed to these bigger cancellations. We have seen more volume degradation from the days of acquisition to what we delivered last year and deliver this year, but are not impacted so much by these complete compensations. Olivier, H1, H2?

Maybe just before a complement on -- because I heard quite a few questions related to compensation in cash by customers. And there is a question about how much is it inside the cash flow of '25? The DSOs that we have are, in fact, the same as the year before. So we are getting claims compensation. We had the compensation of the tariff, but it's more in relation to the cost themselves. And so in terms of collection, I have not seen any particular evolution and the numbers are not reflecting any.

So I would say that the cash flow of '25 is relevant from this end. Related to H1, H2 in '26, I will say on both the margin and the cash flow, you should expect the seasonality that we have had in the past few years, not really no more, no less.

If I assume on the cash flow, you know that we have certain items that are really more topics in H2 versus H1, a lot are related to tax. You have annual tax returns, you pay the tax in the first half. you have certain timings in different items. So I would say H1, H2, '26, the seasonality should be along the average of the last few years.

It's Ross McDonald from Citi. I had 3 questions. First one, sticking with the seasonality in 2026. Would you be able to confirm if on an operating margin basis, you would expect the first half to be in the 6% to 6.5% corridor? And maybe linked to that, on the free cash generation in 2026, how should we think about the phasing, let's say, of the cash out restructurings and the sort of year-over-year on CapEx is the free cash very strongly geared to the second half? Or do you see it quite balanced within the year?

Obviously, the second question on tariffs. I know a lot has changed. And in many ways, it's very soon to be thinking about tariffs given the news over the weekend. Just be interested how you're thinking about the tariff margin in the first half, if you hear any potential changes that could be a benefit or a headwind on the tariff side, I appreciate it's very early days.

And then finally, just on the factoring, very good to see you're working on getting that down now, I think, EUR 100 million last year. Is the target to take that down in EUR 100 million increments going forward? Or how should we think about reducing that factoring in '26?

All right. Ross, thank you. So I'll take the tariff question first and then kick the financial ones over to you, Olivier. So we are going to observe what's happening in the tariff world, right? So the Supreme Court judgment is certainly there. We're not quite sure yet what it really means how they're going to be reimbursement, yes or no. It's important to realize that in the last year, we stayed free of financial impact from that, right?

That was really a nonmaterial. So we are on the safe side, first of all, with regard to possible reimbursements, yes or no. In terms of what's coming, are we going to go from 10% to 15% for all the world. It's speculation. It's not a rule at this point in time. we will stick to the same base principles that we discussed earlier.

That means we will mitigate that effectively for FORVIA. And again, it starts with being local for local, having good content in the various regions. We work with the supplier base to further strengthen that. And whatever exposure is left over, we will go see our customers and ask for compensation in a very strict way.

So on the financial questions related in particular to seasonality. We are giving a guidance for the year, which is EUR 6 million to EUR 6.5 million. I will not give a guidance per se inside H1, but I would say that the goal automatically is to be in this range, but if it is, it will be on the low side. So you will have the seasonality comparable to previous years. But guidance is really on the full year, and that's really H1.

Related to cash flow, maybe first to explain a little bit the evolution we expect on the net cash flow year-on-year before even the seasonality. The evolution that we expect is driven by two specific items. One I mentioned it is the restructuring increase. This is the implementation of the actions that we have taken. You see that in the P&L. And we expect to have an increase in restructuring cash out throughout '26 of around EUR 100 million. This is mainly in HELLA and this is reflected by the way, in the guidance that HELLA gave yesterday morning. So let's say, it's to accelerate the rationalization. It's part of the implementation of EU-FORWARD. It impacts, in fact, different part of the business. this time is more HELLA.

The second thing on the evolution of the cash flow year-on-year is that we have specific one-off that we expect to settle in terms of litigation that can play a little bit inside. So just to say that the evolution year-on-year is not really on the structural item, but we are trying to capture the elements, let's say, in a prudent approach to make sure that the guidance is really minimum that we should for -- now between H1 and H2, I think the seasonality should be similar and you have a bit of working capital seasonality inside, but no more, no less.

On factoring, I will not comment on the further reduction. I will say that we know perfectly that factoring is -- on the one side, it's a sort of funding. It's a source in some cases, of pressure to customer to pay, but it is also having a financial cost. So on a selective manner, why not? But I will not give a commitment and let alone a trajectory on this one, but we have this in mind. And I think with '25, we wanted to show that we do.

One very last question.

It's Jose Asumendi on your left. Just a couple of questions, please. On cost savings, can you comment on the planned cost savings for 2026. And can you give us some color by geography or product division, which divisions will benefit the most? And then Martin, can you talk a bit about the the margin evolution by division in '26, which divisions will drive the margin improvements, which ones you expect maybe to lag, but still improve year-on-year as we think about that margin range for the year?

Yes. Thanks, Jose. So that's quite a few detailed questions digging into the business. So when it comes to cost savings, I mean, every business group is encouraged, right, to move forward, push forward. But then we also have our central initiatives, in particular, EU-FORWARD and Simplify that are going to cross -- that are going to push across the board.

So I would not want to go much deeper, tell you everybody is really working, and we'll do it in a same strict way as in 2025. We have developed a completely new approach looking at our numbers, a new approach in terms of being thrifty. We're going to continue that in a good way. As far as the margin ambitions are concerned, you see that we made good progress in 2025 for all business groups, but Lighting. And the business groups that have shown good tendencies and trends in 2025 are going to continue on that route.

And we have a major repair to do on the Lighting side. So happy to have Peter Laier as the new CEO of HELLA here today, one of his top priorities is to bring better performance back to our Lighting team. So we will see a year of not-so-good performance. And Peter, you've ported out yesterday to the market what that will be.

Thank you very much to everyone. It's all the time we have left. We have another Q&A session afterwards. Moving on to next session. Back to you, Martin.

Yes. Thank you very much, everyone. And again, there is room for questions after the CMD part. That's where we're arriving now. It's time for the Capital Markets Day section.

First of all, give us a minute to clean the stage for that, and then we'll kick off with a brief bio. Be alert. It's a really quick one.

Here we go. It is IGNITE. IGNITE is our medium-term strategy and ambition. And you see the tagline, drive what matters today to unlock, what's next. So we will see now a sequence moat map on how we get to long-term value creation. And I consider 2025 was our year 0 of IGNITE. We had to lay out a first set of results that proof we can execute, we can transform and change FORVIA in a credible manner.

So we split our IGNITE strategy into 2 phases. 2025 to 2028, we want to focus and strengthen the group and lay a very solid foundation for the second phase where we want to lead and grow. So Phase 1 is all about discipline and focus. So we are going to streamline our portfolio. We are going to strengthen execution.

We are going to drive profit and cash generation. And that way, you saw we can deleverage. And a couple of initiatives that we already referred to this morning proof, yes, it's working. EU-FORWARD is materializing, Simplify is now in execution. And you have seen the new investment discipline that we show to ourselves and to the market. And last, not least, also the intended divestiture of the Interiors business is clearly pointing in that direction.

So then for 2028, we have solid foundations. Financially, we have a strong balance sheet. We will have a very concentrated portfolio to enable growth. That's this Phase 2. We want to lead in growth. You will hear about what are the businesses we rely on. And we will have very strong ones in Electronics and Seating that I want to prepare for that growth at a much faster growth than so far.

So the results of IGNITE will be a much stronger, more focused and more competitive FORVIA. Let's refer back to the 3 strategic priorities; best-in-class performance, business transformation and invigorating our culture. Today, we want to go an extended progress report on how we are in those 3 dimensions.

So performance enhancement is taking place on the R&D on the engineering side, obviously, in our operations in the plants and there's a clear enabler for further productivity and the application of digital tools and artificial intelligence. We're going to hear about that one.

Then the business transformation, it's all about sharpening of the portfolio and do that really for leadership positions that we are having with some of the elements of our portfolio, and that's where investments need to go. So we want to be clear with ourselves and you as the investors, where our CapEx, our capital allocations go with priority.

Then we have the divestiture intended for Interior. So that's part of the transformation, a very first good and visible step. Let's now move into the third pillar, our invigorating culture. It's all about accountability and empowerment. And I told you earlier on, I saw really strong accountability already as a good cultural trade in FORVIA, but that element of empowerment of trust to our people, to our teams, that is new, and that is going to really resolve into much better performance.

So we'll be faster, we'll be innovation centric and we'll take good care of our clients in that sense. So you see the 3 strategic priorities that I announced early last year are very relevant for the continuation under the IGNITE framework.

So let's look forward 2028. Where do we want to be there? And here's a financial projection. Olivier is going to give you as usual more details afterwards. But we're going to be a $21 billion to $22 billion company. And this comes with an organic growth in the range of 2% over that time frame. But we also reserve for more divestiture in that number. So there's about, you'll see that from the detail about EUR 1 billion of revenue that we reserve for possible divestiture.

The operating margin will be 7% and above. We expect net cash flow in the range of 3.5% and with that, we can bring down the leverage ratio to 1.2x. That's important. We have shown how we can do that even organically very well. And it's important because 1.2x in the automotive world, qualifies us for investment grade.

So we've got to deliver that for a time, but 1.2x is the entry barrier we are taking. So with that, we are going to get to a very solid financial structure, and that allows for the growth in Phase 2, where we want to lead and grow.

So here's the agenda. How are you going to go through the day. First of all, we will stay on IGNITE transformation. And I believe that's the most important part for you. What's the future structure of the company. For this part, I'll have Peter Laier, our new CEO FORVIA HELLA on stage. And then also Sebastien Limousin in the first row. He is the EVP for the Seating business. So we'll get you through that transformation part. Then after break, we get to IGNITE performance and Olivier Lefebvre, our COO, is going to take care of that.

I'm going to take over for the culture piece, and then I'll leave give you on back with all the numbers to wrap it up, and we go into the second Q&A at the end of the day. So let's start with transformation.

All right. We need to wake up everyone. So let's look into reshaping our portfolio and how we focus our resources on these areas where we have the strongest right to win. Here, the automotive trends. And I mean there's really powerful shifts happening, as you know, in the automotive space.

When we go a bit through the various technology fields, so let's start with Clean Mobility. Yes, it's about electrification, but not only about pure battery electric vehicles, but also hybrid vehicles range extenders are coming up really in great numbers.

Second field, connectivity. And the digital experience we have. Yes, we want to be always on as users. And the integration of our smartphones, everything has to be seamless. That's our expectation that's forming a strong trend. In the middle there, the software-defined vehicle. It's much more than just a buzzword. It really means that architectures for electronics and the wiring harnesses are strictly simplified.

We get to fewer computers in the car, and that is very efficient and at the same time, more and more features of the vehicle are determined by software. And that is upgradable over the lifetime. So a very good trend that goes across all systems in the vehicle.

Then if you go to the safety and comfort space, also there, consumers have more advanced expectations. It's driven to a good extent by the Chinese consumers. And when you then think about autonomous driving, automated driving, it's a whole new level that opens up space for more comfortable seating and many of those products we have.

And for me, it's very important that our activities link well to these trends and that we even shape the trends with our technological innovation offerings. And you can see on the top electronics fuels at all, and that's why there's a super growth field for us. We are going to go into a deep dive a little later to say what are the specific areas that we grow from. But also Seating and Lighting, right, with that request for safety and comfort there's more content coming, and we are driving that.

And even a seat is in the meanwhile well controlled by software. So that software-defined vehicle trend also impacts our Lighting business and gives opportunity to the Seating business as well. Clarion is clearly playing to the connectivity and digital experience.

And last not least, we have our Lifecycle Solutions business, which serves aftermarket and you can see how that benefits actually from all the content that goes into vehicles. So in essence, our activities that we have are very well associated with the driving trends that we see in the market.

So much for a technology quick overview. Then what are the market dynamics? We have a clear view on that. And there's a lot happening in Asia and in China, that's where the key growth is, and that's where we are focusing. And at the same time, the world gets very diverse. Regulations are specific to each country, to each region at least.

And we know we follow that. And we talked about trade barriers, the tariffs also something to have in mind. How does FORVIA prevail in that kind of complex environment? So first of all, we have a clear global reach, right? The world is our marketplace. We want to be there for everyone, for all customers in all regions. That's the aspiration.

We have a global footprint. So we are also close to our customers. When we discuss tariffs, we said, no, our belief is local for local production, local for local sourcing. So that's good because that proximity gives us also the intimacy with the customers that we need to score and to grow even faster.

And this intimacy is really taking place with our well-established customers, let's say, in Europe, in the Americas, but as well with new entrants and in particular, with the Chinese OEMs. So from that point, I say we are very well prepared for our future growth.

So before moving on, there is a quick summary, I want to give. Think about where we are right now. We say we have a portfolio that's well connected. The world is our playground, right? So what do we have to do? Now we have to select where we want to play the strongest, where is the strongest right to win. And that brings us, in fact, into that slide here.

And I believe, ladies and gentlemen, that's at the core of the strategy, and I know you have waited for that center piece a little bit to know whereas FORVIA we are going to focus. So you see on the one hand side, the growth cluster on the other hand, the value cluster. So we divide our portfolio in 2 groups. And both groups have different roles when it comes to strategy.

And both roles are very important to FORVIA. So it's not about important one over the other, but it's different roles in life. So in growth, we positioned Seating and electronics, where we enjoy a very strong tech leadership, where we have a diversified customer portfolio, and again, where we have the right to win.

Here, we are very ready to invest, obviously, always in a disciplined manner, but that's the main stream that we want to pursue. And on the other side, when we look on the value segment, we have Clean Mobility in there. We have the Lifecycle business, the lighting business in the business and also Clarion on that one.

So as I said, it's equally important, but the focus is different. Here, it's about real performance, performance, performance and cash generation. That value cluster fuels the future growth story of FORVIA's. So I think it goes without saying we need different leadership on both sides, right? One, with that clear performance focus, the other one sure, also with performance, but then with growth in mind.

So we have different assets in those 2 different clusters. Let me tell you why do we choose electronics and Seating to be in the growth cluster. Well, electronics, we talked about the trends and how this is a super growth engine, software-defined vehicle electrification, autonomous driving, it's pretty obvious. There's just tons of opportunity.

But all seating is growing in terms of content because there's better comfort expectations by the users. Those of you who have been using Chinese vehicles, maybe in China, have come to accomplish all that to appreciate all that comfort, right, that new seatbelt, but also safety requirements are still increasing for seats. The user experience is to be better, and there's also sustainability requirements that drive that Seating business.

So we have good leadership positions in both of them. So then let me see -- why those 2 together? Let's have that look too, right? You understand the individual strengths, but there's also strength in combining those 2 because there's the ultimate growth happening in the electronics business. But also on the seating Side, we have resilient growth. Every car continues to have seats, that's good. But by that content growth, we are on that continuous ramp as well.

So we have complementary business of something very resilient and stable. And yes, we take more chances and invest better risk a little more also on the electronics side. But together, it's a strong complement. So one step deeper, let's look a bit into the electronics business.

We have a strong momentum going in that segment already with an annual growth rate of about 10%. That's where we are. And we have very strong leadership positions already in body electronics, in the energy management field and with our components business, components are sensors, including radar and also actuators.

Going forward, we want to double down on a couple of elements, and Peter is going to share them. We believe that there are strong growth opportunities. We have zonal contributors with more integrated power electronics and also within cabin electronics. So Peter, we look forward already to your presentation, really doing a technologically deep dive into those areas.

Overall, we see that we can even boost the growth rate of our electronics business. So when you think about the second phase, lead and grow is going to be in excess of the 10% we offer here a 12% CAGR perspective.

Now going to Seating. You got it, right? There is more comfortable on the safety requirements that drives content per seat or content per vehicle. And we've played in the seating area very well from our China strength. Now that we are the leader there with the Chinese OEMs when it comes to Seating applications. We innovate locally very fast. They are very competitive in that field and a very fast and industrializing business.

Those are strengths that we transfer to the rest of the world. So when Sébastien is going to be up and talk about his growth, it's going to be not only about the technology but also about further geographic extension. So Asia is a playing field, good focus has gone into India. We are going to talk about an extended customer base as well. Today, we are pretty strong in passenger car vehicles, but we can extend that very well to the commercial vehicle space. And then also in that field, we see strategic partnerships that we can have around the world as an additional growth driver.

So Sébastien, you want to explain how you put growth into gear and make it to a 4% growth business in the future. That was the growth cluster and 2 businesses that belong to it. Now I would like to turn to the value cluster and give you a little bit of light what's happening in the various businesses there. With Lighting and Clarion, we have 2 businesses that will enjoy operational improvements. We are not at the top of the game as we speak.

There is margin upside in both of them. So let's start with Lighting. There's a EUR 3.6 billion business today, and I think you can agree that FORVIA HELLA Lighting is the undisputed tech leader, when it comes to lighting over the last 100 years. Nevertheless, we got to focus costs. And we've got to be much more CapEx and cash conscious in that field because playing in that old premium segment was good.

We want to expand that business to really hit the volume space. So first step is going to be bring cost structures in the right spot and then grow into the volume market much better. Going to Clarion. It's a EUR 1.4 billion business in cockpit electronics. Here, we are going to gain competitiveness through structuring our R&D approach and R&D costs much better.

It has clear rationalization potential and another route that we pursue is looking for partnerships in that area, because the business is so R&D intense. And you can imagine the tons of software that go into an infotainment cluster, we want to be able to share these efforts with partners.

So again, the business gets more R&D effective and therefore, then also more profitable. So in summary, performance, profit and cash to be improved on those 2 segments. Now let's look at the second part of the value cluster. We have Clean Mobility and Lifecycle Solutions in it. And those are already strong cash generators as we speak.

So Clean Mobility is a EUR 4 billion business, and we are the world leader, both in terms of volume and technology. And I explained already earlier that there is an outlook also on more technology coming for hybrid vehicles for range extender. So we are going to keep boosting that. And if I have to characterize what is really important for that business. well, in a way to load our existing capacities because there is no doubt the number of internal combustion engines are still going to decline.

So we want to remain and strong and secure a good market share and increase our market share to load existing capacities. We've been pretty successful in doing so. So customers give us organic business, and they help us also to organically consolidate. What does that mean? When customers used to do their own exhaust production and want to get out of it due to the transformation, they hand over these volumes to us.

The same thing is true for players who decide to no longer play in that space. So what I call this organic integration and consolidation is something that we continue to drive. All in all, that results in double-digit margins and a fine cash generation. Last one on the list, Lifecycle Solutions. Here, it's a EUR 1 billion business, and we benefited very well from the strong HELLA brand in the aftermarket.

Why is that business so successful over the years and very robust? Well, we have a good combination of knowing the OEM business of being with the workshops, we do diagnostics means and devices for garages and workshops. So we know what parts are being needed to repair vehicles. And then we have our aftermarket channels to bring the parts to the point of use.

So that's a strong proposition. And again, it has delivered our very resilient margins and cash flow. Also, I want to give you an example, value cluster businesses can still grow. We intend to do that in aftermarket, right? Aftermarket is a trading business, we can grow in an asset-light manner by taking other companies' products and channel them into our aftermarket term routes.

So you see how growth is not contradictory to being a member of the value cluster family. All right. So I think with this, we are through the most important piece, growth and value. Now let's look forward. We want to boost obviously, the whole company. I gave you examples also in the value cluster. We have 2 more dimensions in which we will boost the growth.

And that is once by geography and then also by the customer segment extensions. So let's talk geographies first. China is a strong game of FORVIA's. Last year, we were 21% of our sales or EUR 4.5 billion after IFRS 5 in that market. And COM so far had 50% plus of our business. I mentioned the order intake, right? EUR 8 billion, 80% with Chinese OEMs. So that's putting the whole game into another gear. Also, the customer extensions we are doing right now.

We said we are strong with BYD. In the past, we were not strong enough with Geely. We are adding Geely now to the portfolio, Lutz as well others. So that's good. You'll hear this year about just the new Seating partner that we'll be announcing. It's going to be of the same quality as we have been doing with BYD and Chery where we become a major partner of a large OEM in China, providing their seating solutions.

So China is important, and I mentioned that, but I want to repeat it because it's really a learning and training center for us. We drive innovation locally. We drive it at speed. We drive it at great cost. So our global OEMs are going to benefit from that. And it goes without saying that we also joined the Chinese OEMs when they go their global expansions.

So BYD, Chery, Leap Motors are now customers of ours here in Europe or when they go to South America as well. So in summary, we expect the further growth in China and particularly with the Chinese OEMs. So Chinese OEMs should represent around about 16% of our global sales by 2028. That's a I think, impressive number.

So let's continue in terms of diversification and segments. Well, we have opportunity. We have opportunity with Japanese and Korean OEMs. We have opportunity in India, and we have opportunity in the commercial vehicle field.

So let's start with the Japanese and Korean OEMs. I mean those firms delivered 32 million vehicles a year, 1/3 of the world market. And we are around about represented with 10% of the global FORVIA sales with Japanese and Korean OEMs. You can see what kind of an opportunity that is.

Why is there a special interest by the Japanese and Koreans these days in FORVIA? It again goes back to China where we prove innovation, cost competitiveness, speed. So we just had a very fine order that we took in from Toyota this past year were exactly due to these trades and capabilities. They chose FORVIA into a commodity with Toyota that we have not served before.

So again, China is really good practicing ground makes us very attractive. Next one India. By 2030, we expect that market to be 7.5 million vehicles. Our sales last year was EUR 450 million. Compare that to our EUR 26 billion, you see it was a smaller piece. And at the same time, we already have 6,000 people on the ground in India. They are of more than 2,500 engineers.

So far, these engineers serve the global projects as extended workbench for R&D, and they are ready and capable to now drive local business. So what's easier than putting our engineers in India to work towards the Indian customers, both the international ones and the local ones.

And also here, I want to leave a number with you we expect to double our EUR 400 million plus sales by the end of this decade. Good. And the third column here, very quickly. Again, we mentioned that already with regard to the Seating business. We have a great opportunity when it comes to commercial vehicles.

Today, that segment is good for 2% of our global sales, that's really small. The market commercial vehicles are super attractive. It's driven by regulations. The products, the technologies are highly innovative, and we can enjoy a long life span once we get into these programs. Therefore, we have now structured dedicated product lines and also dedicated teams that are going to tap into the commercial vehicle market for us.

So you see in both dimensions, geographies and customer segments, there's more we can do and we will do. So let's zoom out once more. I try to take all of you really on that IGNITE journey, right? So where do we start? Said, okay, we understand the trends. We know how the FORVIA business groups relate to these trends. We have IGNITE Phase 1, pretty much laid out, right, in its strategies, performance, transformation and culture.

We look deeper into transformation and the portfolio, 2 clear clusters that are going to drive our capital allocations between the Grow cluster and the value cluster. And then if you go across the board, we have additional growth opportunity for everyone by driving the right geographies and extending the kind of customer segments we serve. So that's where we stand so far. And I want to invite you to 2 deep dives, we chose obviously the 2 businesses in the growth cluster to give you an idea, what are the technologies, what are the growth opportunities? So first one on stage is going to be Peter Laier for the electronics portion and then Sébastien is going to follow up on the seating side. Yes.

Good morning, ladies and gentlemen, as well from my side. As mentioned by Martin, electronics will play a central role in FORVIA's IGNITE transformation. Please allow me to start at first with a summary of the 3 key takeaways I want to convey in my presentation in the next few minutes.

First, electronics business gives us over proportional growth opportunities with a very solid bottom line performance. Second, we are very selective in identifying our targeted business arenas, specifically in electronics to play to our strengths. And number three, we have already remarkable business wins in electronics and contracted technology partnerships with our customers that confirms that we have selected the right arenas to play.

So in summary, the motor to remember is we are choosing our business arenas carefully to unleash profitable growth. So let me start on the next slide to show you which trends are shaping our industry and how we turn this into attractive business for us.

Our electronics portfolio is aligned with the related key trends in electronics. Those trends are software-defined vehicles or in short SDV, the electrification of the vehicles and the powertrains and in-cabin user experience. The SDV trend increases the software content in the vehicle and the software content independent of hardware. That means this increasing software content and the related functions leads to a move from increasingly distributed architectures to less complex, more centralized EE architectures in which the centralized hardware is characterized by domain and zonal ECUs. And those ECUs are running the computing and the decision-making.

By 2035, we expect somehow 60% of newly produced vehicles to operate in some form of those centralized EE architectures. Hence, there is an innovation race to be born being first to market with leading-edge technology. The second important trend you see on this chart is electrification. Despite some hiccups, which we have experienced in the Western world, electrification will continue to ramp up across all different electric powertrains.

Electric powertrains will raise to approximately 70% of newly produced vehicles in 2030. We anticipate a prolonged period of parallel electrification. That means we will have mild hybrids. We will have plug-in hybrids, range extenders and full battery electric vehicles. But one thing all those technologies have in common, they will continue to drive an above-market trends demand for battery management and power electronics because all of them need to have solutions for electrical efficiency, and that is exactly what we can provide.

The third trend you see on the chart is user experience in cabin user experience. This is on the one side, driven by enhanced safety regulations. And on the other side, by an ongoing expectation of sophistication of user experience in the vehicle. In the future, automated driving vehicle generations will have the need of driver behavior monitoring to fulfill safety regulations. This results in an increased demand of in-cabin monitoring solutions.

At the same time, the users are expecting seamless integration of their own digital environments in the vehicle. This drives a demand for solutions that provide technology-agnostic connectivity and platforms for digital high-end offerings in the car of the future. We are operating in a market which is sizable and growing significantly faster than underlying vehicle volumes.

As you can see on this chart, the segments we are addressing are EUR 30 billion plus in sales already today. And while vehicle production will only increase by around about 1% per year until 2030, we expect an average growth rate of around 10% per year in our slice of the market, and that means this market size will grow to around about EUR 50 billion by 2030.

Our electronics business is actually around EUR 3.1 billion strong today. That means we have market share of around about 10%. As mentioned in my introduction, we choose our business arenas carefully to unleash profitable growth. And we have proven since many years with a strong track record that we are selecting our playing fields carefully.

And that in line with the related segment attractiveness, our ability to differentiate and to play to our strengths. As you can see here on this chart, all areas we have selected to play, be it battery and power electronics, be it body electronics, be it selected components, be it in-cabin electronics, all of them will experience a high above average growth rate.

So let me now talk a little bit what sets us apart and how we will win this game. So we have established and we will continue to expand our leadership in market positions and technology. We are already today amongst the top 3 in battery and power electronics in selected components as well as an in-vehicle app markets.

And already today, we are generating 80% of our order intake in highly innovative and fast-growing areas of the business. including high-growth business with components, for example, where we are with our industry-leading radar sensors in a very good position.

Our customers are trusting in us. We have already today over 50 OEM technology partnerships, and that reflects that our deep and long understanding of the customer relationship, our early involvement in technology and architecture is proving that we are the partner of choice.

Our right to win in electronics is sustainated by a broad skill set spending the full value from components to systems, from hardware to software. And our market leadership provides us a scale which we need the cost base, which we need to ensure healthy returns.

Let me now go a little bit deeper about the selected key growth drivers, which we have in our business and how this is shaping the mentioned industry megatrends. What you see here are 3 concrete examples how we choose our arenas carefully to unleash profitable growth. You remember the motto.

In the arena of SDV, the newly related centralized EE architectures, here in this area, we selected specifically zonal modules as our area to play to our strengths and to win. And at the same time, we have decided actively to stay away from high-performance compute and the domain ECUs.

In electrification, we have already today a strong base in battery management systems and power electronics. By combining both of them in our so-called energy management system, and integrating further functions, we provide a key enabler in the future for efficient energy management in the next generation of electrified vehicles.

In regard of our in-cabin user experience, we focus on 2 areas: the interior monitoring and the in-vehicle app market. Our allocation of capital, as mentioned by Martin, as well as our resources is focused exactly on those strategically selected segments, where we can play to our strengths and realize profitable growth. If you look now to this slide here, let me dive a little bit deeper in the SDV structure and our strategy in that regard. But before I do so, please allow me to show a short video about the characteristics of EE architectures in the future.

[Presentation]

Yes. As shown in the video, you can see that the shift towards those centralized EE architectures concentrates the value in domain and zonal ECUs. With that, we focus on zonal ECUs as mentioned, and we are then able to capture larger spend of spend of the OEMs in this arena.

Our integrated one-stop shop solution for zonal modules offers chip design, hardware and software at the same time. This increases the agility and enables the OEMs in their transformation to central ECUs to act according to their needs and with that they have the partner of choice with us. First to market in execution with leading OEMs and the order intake of already now over EUR 1.5 billion provides tangible evidence that our customers trust in us and that we are able to grow in this area reliably.

On the next slide, we make a little bit of deep dive in the different types of electrification, as I mentioned, from hybrid to battery electric vehicles, demand will increase in the next few years and there is a demand for advanced power electronics integration on system level.

With our innovative X in 1 system, we are combining battery management board onboard charger, DC/DC converter, together with software-enabled compactness into 1 ECU. This new exin 1 system delivers somehow 35% volume reduction. 20% rate reduction and 5% efficiency improvement compared to the combination of the stand-alone components.

Selected partnerships we have already with battery cell manufacturers and early OEM co-development positions us as a major player on the future of EV platforms. Our order intake is in 2025, over 1.2 billion just for battery and power electronics, and this provides, again, a clear evidence of customer trust in us and gives us a clear indication of future growth opportunities.

In regard of in-cabin user experience, as mentioned, regulatory and insurance regulation standards are elevating safety requirements inside the cabin, specifically for increasing number of automated vehicles. This regulatory shift translates into tangible growth for us with in-cabin sensor content, which is increasing by somehow 20% per vehicle annually.

In parallel, the connected vehicle rise by 10% per year due to the mentioned expectations and the seamless digital continuity, which we are having as a demand related with technology-agnostic platforms that integrate personal digital ecosystems into the car.

We address both the opportunity spaces through integrated hardware and software capabilities, which we have. And in 2025, as a proven point, we strengthened our cooperation with Microsoft to enhance voice-enabled interactions intelligent content discovery as well as personalized user experiences. Our confirmed orders already today for interior monitoring cover over 5 million vehicles, and we have a broad adaptation for happening in the vehicles. As well, this provides, again, tangible proof of our growth opportunities in the future.

So to summarize, we will expand our growth in electronic business systematically. Until 2028, we grow with a CAGR of 10% in line with the market. Earnings guidance for the same period until 2028 is 8% operating margin. And as mentioned, we prioritized investments in the mentioned high-growth innovation-led segments. From 2028 onwards, we expect a benefit from those prioritized investments as industry trends will scale further. Our growth outlook beyond 2028 is 12% or above, driven by market share gains on the one side and the creation of further leadership positions.

Yes. With that financial outlook, I would like to close my presentation. I would like to thank you for your attention and hand over to Sébastien.

Good morning. I'm going to highlight today our ambition and strategy for FORVIA Seating. They are based on 2 pillars. The first one is resilience and stability, thanks to a balanced geographic mix, but as well a consistently improving operational performance.

The second pillar is growth. We have a strong potential for growth, thanks to the exploration of new markets and new segments and thanks to innovation. So that's what I'm going to present. But first of all, let's look at our product. And let me start with a simple factor.

A seat is one of the most complex systems in the vehicles. It interests numerous technologies and more than 80 components. We have more than 80 components per seat. In addition, a car manufacturer can order up to 20 different variants, just hours before deliveries. So managing this level of complexity requires deep expertise.

One because we need to deal with metal, textile, foam, but as well electronics and sensors. We need more than 20 different skills to develop a seat. And in addition, we need to be compliant and we have to be companion with the most stringent safety regulations like OCS in the U.S. FORVIA is a unique competitive position. So first, we are #1 on mechanism and structure, and we ranked third on complete seat.

Our strengths come from our dual business model. On the one side, we have -- we deliver high volumes and highly engineered product mechanism and structure from massified and regional hubs. On the other side, we have just-in-time facilities, just-in-time assembly. They are located very close to our customers to ensure maximum flexibility or activity.

And this old business model gives us resilience and is highly cost effective. In addition, we have a balanced customer and geographic mixed. We are particularly strong in Asia, including China, of course, where we generate more than 30% of our revenue. Our stability and growing performance is driven by a strong industrial performance with the goal of setting the standards in manufacturing. So first, we rely on automation.

Automation and artificial intelligence is to continuously improving our process. Secondly, on the second lever is a selective vertical integration in our just-in-time facility to further reduce cost and improve efficiencies. And the last one is modularity. We have launched a module concept for process and product in order to further reduce our costs and to increase our flexibility.

A clear evidence of all of this is the factory you see here on the picture. We have been awarded as a lighthouse factory for outstanding performance by the World Economic Forum in January 2026 in our plant in China. This external recognition is an external recognition is a clear evidence of our leading position in manufacturing.

Let's now look at our market, Seating market. This is a EUR 65 billion industry in 2025, but several segments are growing very fast. The first one is comfort and wellness solutions, with the growth expected from 5% to 8% per year until 2030. This is directly aligned with the premiumization we see globally, particularly in China. The second one, and Martin mentioned it earlier this morning, is India. India is another major driver for growth, and I will explain later while we are well positioned to capture this growth.

The last 2 segments are different. So Japanese and Korean OEMs and commercial industry vehicles, these 2 segments are the segments where we have a strong potential to increase our market share, and I will show you a while later. To conclude, our growth pillar is a combination on one side on dynamic markets. On the other side, the exploration of new segments and geographies.

Our stability growth is really fueled by our innovation road map. We capture the market trends, which are on one side, more comfort and better user experience, on the other side, sustainability. So let me share with you a few examples of our innovations. The first one is 60. So 60 is a concept of seats, which enables you to inside your seats at 60 degrees like that, while ensuring the safety of the occupant.

So this is a strong demand from the market and from our customers and we have developed a unique position, a unique solution, sorry. On comfort, we are continuing to expand our best-in-class offer on heating, on ventilation on message. We have innovation in this area. In addition, we have developed a new concept of a sensor for OCS or occupant safety classification, which address the upgoing regulation in the U.S.

Finally, and last but not least, sustainability. Sustainability is really embedded in everything we do, and I want to share a few examples. The first one is Clarion. Clarion is our solution. It's -- it's a recyclable material, which is an alternative to laser. It is made from recycled PET and this material Clarion enable us to reduce the carbon emission by 90%. And this material, corium, is already in serialized production for 2 customers.

We provide as well lightweight architectures with low carbon steel demand from our customer. And we designed product from reseat. All these innovations you see here contributes to reduce our carbon emission, which is our goal and commitment.

China plays a key role in our innovation. Actually, FORVIA -- FORVIA Group was one of the first Tier 1 supplier to invest in China, and we are now our Seating division, so FORVIA Seating employs more than 1,000 people in 3 R&D centers, serving major clients like Li Auto, for instance, or Chery or BYD.

Our strong relationship in with the customers in China enable us to be at the forefront of the innovations. Why? Because it gives us speed and agility to develop our innovations. One example, and Martin mentioned it earlier this morning, is a 3D zonal message. You see here, we are able to develop this innovation in less than a year from concept to cell life production, and we did it in China.

The second example I want to share with you this morning, and we developed it in China as well is the intelligent seat. Let's look at a short video.

[Presentation]

What is the key takeaway of this innovation you saw in this video and that you can see in our facility today. What is the key takeaway? We are able to combine our expertise in comfort with our knowledge of software and AI to provide the best experience on board. And that's really our strength to have comfort and wellness expertise enhanced with AI and software capabilities.

India. India is, as mentioned by Martin, one of the most dynamic automate market with strong growth projected at around 7% every year in order to reach a EUR 4 billion market for Seating in India in 2030. And FORVIA -- FORVIA Seating is extremely well positioned to capture this growth. Why?

First, we are already present in India, and we have a long-standing relationship with both global and local OEMs such as Tata, Volkswagen, Mahindra and Maruti Suzuki. Secondly, we are now expanding our footprint in India. What we are doing is to move from a mechanism on structure footprint that we have today to offer a full complete seat footprint in the coming months in order to reach 10% of market share in India.

This is our ambition, 10% of market share in the coming years in India. Another strong opportunity for us where we have really a huge opportunity to increase our market share is a commercial on industry vehicles. This market is a 7 million unit market in 2025 and it is considerable both in China and in India, where we are expanding.

We have already built strong partnership, 2 examples one strong partnership with the European truck manufacturer on the on-highway segment, and the second one is a partnership on contract with an American manufacturer in agriculture. We have already secured a multibillion euro contract, which will enter into production in 2027. What is new now?

In this segment, we are reinforcing our portfolio with a dedicated offer for commercial vehicles, accelerating in both segments, so in on-highway and off-highway. We are really developing product specifically adapted for this market.

Our ambition is to -- is that these markets or commercial and vehicle segments represent 10% of our overall sales by 2030. Now let me conclude with our financial trajectory. On one side, our sales are expected to grow at 4% on average from 2028. This progress is driven by 3 strategic pillars that I just presented. So new products, new geographies and new markets.

That's really one part. The second one is that we are focused on disciplined execution. Standardization of our architectures, automation and AI, selective vertical integration with a strong financial discipline of CapEx allocation. This initiative I just mentioned, are already visible in our manufacturing excellence on our financials.

To give you an example, we improved our profitability by 7 basis points in 2025 versus '24. To sum up and in short, our transformation is both innovation-driven and performance-driven. Thank you for your attention.

Thank you. So let's wrap up the transformation session of IGNITE. So you saw we are working in different phases. Phase 1 of IGNITE is about discipline and focus, and that's true for a streamlined portfolio. It's true for a much more consequent execution. We will generate better profit and cash and continue our deleveraging that way.

So we want to play to the strengths and those 2 deep dives served to show where the real strength sets its deep technologically rooted. So we are going to go into these established areas, but also selectively expand the portfolio.

And with that, we get into a growth phase in the Phase 2 of IGNITE, where we can work from a healthier balance sheet and have a more focused portfolio. So we can expand leadership really in those technologies, where we have that long-term right to win and can create that longer-term value.

So in summary, IGNITE is pretty simple and a good study has to be simple and can be communicated that way. IGNITE is to drive what matters today to unlock what next. So that brings us to what's next. It's a break, a 15-minute break.

I would ask you, everyone be back at 11:40, make it 18 minutes. There are some beverages and little snacks available for the people in the room, and we see you back online as well at 11:40. Thank you.

[Break]

So welcome back, everyone. We get into the next IGNITE chapter and that's IGNITE performance. For this, I would like to welcome our CEO to stage, Olivier Lefebvre, get us through that part of the program.

Thank you, Martin. Ladies and gentlemen, I'm glad to be with you today as a committed for the end leader to building an engine that drives value, scale profit and keeps us ahead. Today, I want to make one thing there absolutely clear. Our strategy for best-in-class performance follows 2 powerful directions. .

First, we focus on delivering operational excellence now. This is our foundation, our core and it delivers fast and tangible results. Second, we use this strong base to scale our performance for tomorrow. That means driving the structural changes we need today.

Let me take you through these 2 directions. Let's start with where we come from. FORVIA is a unique operating system, the FORVIA Excellence System. It already gives us a strong base built on safety, customer focus and sustainability. Let's start with safety. In just 3 years, we have reduced our accident by 3, thanks to the consistent application of our standard. Our option is total safety for our employees with less than 1 accident per million hours, a benchmark in our industry.

Looking at our customers, we have improved quality year-over-year, reducing class by 30% to 2023. This progress earns us more than 160 awards in 2025. Our customers now see FORVIA as one of their best partner, responsive, proactive and transparent. Regarding sustainability, we have reduced Scope 1 and 2 by over 90%, thanks to the commitment of our site. And we reduced emission by 24% versus 2019, while keeping aligning our strategy with our customers. Thanks to our FORVIA Excellent System, FORVIA stands on solid foundation. Before going further, I would like to show you a short video that brings this system to life.

[Presentation]

Our FORVIA Excellent System does not just create foundation. It boost profitability. You saw in this video, our FES drives continuous improvement, lower inventory, better equipment and labor efficiency, optimize material usage. It creates value every day. FES is also about performance discipline.

When I review plant performance as COO in 2025, we focus on the plants with the most limited FES applications, located mainly in U.S., Mexico and Interior Systems. These are the plants at the bottom left of the graph. In just 12 months, by applying FES, these plants improved their margin by 3.5 points. This was a major contribution to our last year performance.

From now, we are changing how we operate. It is a cultural change. We want FES apply everywhere at any time FES is not optional. But what is even more important by lifting up all our plants to the big blue square, we prevent any risk of deviation. And we enable the transformation of the potential we have identified to deliver operational excellence. .

At the same time, we are also transforming in a structural way through 4 decisive work streams in order to scale the performance for tomorrow. Firstly, we are strengthening our operating resilience. Secondly, we need to further adopt their investment structure; and thirdly, we need to continuously improve our cost base. And finally, we are scaling digital everywhere and AI transformation on a selective with very high potential domains.

This is how we achieve best-in-class performance. To secure our performance in a fast-changing business environment, we must adapt our value chain management and enforced cybersecurity. Best in client value chain management requires both on one side, resilience and on the other side, best cost. We already have 80% of our direct purchasing local to local that already provide a strong core, but resilience today requires much more.

It means end-to-end transparency, proactively redesigning our supply chain network. And it means creating optionality before the next disruption, not after it. To keep delivering best-in-class cost in this growing complexity will leverage AI. AI sourcing agent for our purchasing team to capture the best opportunities, AI to optimize our transport along with organization transformation.

This is tangible value creation. By 2028, our transport cost to sales ratio will drop by 20% versus 2023. In short, we are securing our execution by tackling the biggest external challenges in a structural and competitive way. We are also boosting our agility by bringing CapEx and capitalized R&D, clearly below 7% of sales.

We've already accelerated our development lead time to match Asian market expectation. And last year, we cut lead time on key European programs by up to 50%, thanks to a smarter balance between standardization and targeted customization. The key point now is to scale these achievements.

By leveraging our know-how, our lessons learned and our best practices with virtual twins will reduce development hours on all our programs by 30% by 2028 versus 2023. On manufacturing, we are reducing our CapEx to the minimum needed to operate, but without compromising performance, thanks to a stronger discipline in how we allocate CapEx and shape our footprint. Thanks to standardization and lean design to massify equipment and lower cost and also by limiting investment, thanks to higher equipment efficiency and reusing asset.

In short, we are reshaping our investment base to fuel sustainable growth as we saw before, and stronger cash generation. The third pillar of our transformation is how to define a more competitive race powered by, on one side, smart automation and on the other side, a simpler, faster organization.

With more than 2,000 AGV and 7,000 robots already in service in our plants, we have already proven that how selective automation boost productivity and optimize cost. Now we scale this globally, focusing on short payback opportunities. This will help us to increase our labor productivity by 10% by 2028 and striven our margin.

At the same time, we are simplifying how the company works. We are driving a real cultural shift, fewer layers, faster decision streamlined and AI agent to automate end-to-end processes. This is our Simplify project to deliver EUR 110 million in cost base reduction. In our market, defined by speed and competition, we are moving to operate faster, lighter and stronger.

Our fourth axis is our digital and AI transformation. Our ambition is clear: connect, integrate and scale AI to unlock value creation. Creativity is already transforming our performance. We have today more than 5,800 production lines that generate real-time data, structured data in the cloud.

This power quicker deviation detection, faster problem solving, process parameter optimization and strong plant performance through tools like, for instance, predictive maintenance. We are also eliminating intermediary system that break digital continuity across the product Lifecycle.

Within 3 years, sales, engineering, purchasing and plants will operate on a fully integrated system. That means better cost and margin visibility and seamless data continuity from R&D to manufacturing. And finally, we are leveraging AI to increase our value creation. From our business transformation studio, we are industrializing the development of AI focused on high-value creation and quick payback digital bricks.

We are scaling more than 30 AI agents moving from decision support to automated decision-making. So every function can lift its performance. As already underlined by Sébastien in the Seating part, we are very proud of one of our plants.

This plant has been recognized as a lighthouse factory for outstanding productivity by the World Economic Forum. Let's immerse ourselves in the Yangcheng plant to discover how they connect, integrate and scale AI every day.

[Presentation]

To conclude, we built on our greater strength, the FORVIA Excellence System to deliver operational excellence everywhere at any time. At the same time, we are driving for structural transformation that will scale our performance for tomorrow. Together this strategy, we lift our operating margin from 6% to above 7% by 2028. Leadership is always making the difference. And this is exactly what Martin will talk about now in the IGNITE culture chapter. Martin, floor is yours.

IGNITE culture. The third element of the strategy. The question is how do we operate as an organization, and that is actually the key to delivery in the end. So coming in and looking at FORVIA, I came to a quick conclusion that we have to refine the operating model.

We have to be simpler, faster and more accountable at the same time. So we touched on the organization. We are undergoing an organizational refresh, and we are also cultivating new leadership principles that I would like to share with you this morning.

At the back of it is all about empowerment, empowering teams while at the same time reinforcing accountability. So a more agile organization in my eyes is absolutely mandatory to master the complexity and the volatility of the market. We want to go deep, right? We want to have people decide where the decisions are needed, and that's the empowerment I'm talking about.

So let's look at organization first. We've announced last year in October that we are going into a division-centric organization. So I want to explain what that means. Divisions in our language are business units that act locally. So it's a subgroup of a global business group. So let's say Seating in China is a division or Electronics North America is a division.

And this is where we strengthened the organization and the accountability a lot. Why do we do so? Well, those are the people on the ground, right, closest to the customer, closest to the market, they know what's needed. And traditionally, that division has already owned its operations as well. So you do everything from the customer and in the plant.

What we are changing right now is that we are reducing the matrix organization that was in place. So divisions used to get engineering services from a central engineering organization. And I did not find that very good because then accountability is diluted, right? You want to give the engineers that are needed to launch products to these divisions.

And that's what's happening right now. At the same time, we're increasing authority limits for the divisions as well. So within our disciplined framework, they have now greater rights to choose how to invest into their CapEx or what kind of contracts we have with the customers. So I find that authorization is very important, also clear sign to the divisions we mean it. We do empower you, but also we expect results.

So there's this full accountability for the outcomes that is important. Full accountability means you get everything you need to do business successfully. At the end, it's about delivery. It's not about excuse in that framework. So the result are faster decisions, better adaptability and good ownership.

And that for me is a key enabler for IGNITE. So now let's look bigger. Obviously, IGNITE is driven by our employees and is facilitated through good leadership. And therefore, we are cultivating 3 principles: Guide, empower and recognize. So our leaders are here to guide in the first place. So we're setting the directions, we are giving the priorities, and we are removing obstacles for the teams.

Second, on empowerment, you got that through the division-centric organization. We want to make decisions at the point of impact. We show trust to our people. We enable them to deliver, but also we hold accountable to the results. Third element is recognition.

I tell you, we have been always pretty straight and direct with our feedback in FORVIA. I want that to happen in both ways, right? We talk about critical things. And yes, we are ready to take that critique, but I want also as to recognize good performance and really foster that collaboration, that team spirit and value good results. So that's why we've picked #3, the recognition.

I want to assure you, those are not only aspirations, guide and power recognize. But first of all, we work with the leaders to establish those principles, and we do also measurement for it. So already last year, our top leaders got feedback from their teams. So how am I in guiding empowering and recognizing? And that feedback went into the performance appraisals, finally into the merit for those top leaders.

We're going to do that this year for all 6,000 leaders in FORVIA. Everyone, single one of us is going to get a feedback from our teams on guide and power recognize, and it's going to impact my performance appraisal every year. You see how we have systematic leadership development now in place as a transformation driver. Okay, no clicking, puzzle, which means we come to the next stop. Olivier, wrap it all into financial for us.

Good morning again. And you have seen that we have set FORVIA, a clear strategy, clear priorities, clear choices. But now I would like to show how they translate in financial outcomes. I will focus on 4 key messages. The first one, a restored balance sheet. We have progress that we have achieved, and we have the forthcoming divestiture of Interior. .

The second message is about a new way to manage the company. We have differentiated activities in 2 clusters is a differentiated approach, which enables clear and decisive investment allocation. Third is about structurally improved financial metrics about cost reduction and a stronger recurring cash flow.

And fourth, what will be FORVIA in '28. FORVIA in '28 will be a solid and resilient company with a clear financial structure with a focus on the development of electronics and Seating and the flexibility to fully unlock those possibilities while maintaining strict financial discipline.

So let me go through the different points. First point is about the balance sheet. So we have strengthened clearly the balance sheet since the acquisition. And 2025 is showing an acceleration of the organic deleveraging. We have -- you have seen the number earlier on.

We have reduced organically the leverage by 30 basis points on average since the acquisition, the organic deleveraging is 20 basis points. The second is that the situation at the end of '26 will be, in fact, through the organic cash flow generation, organic deleveraging, but complemented by the interior divestiture with more than EUR 1 billion of the net debt reduction, a company with EUR 4.5 billion in debt, EUR 1.5 billion in leverage. On both metrics, it means a division by 2 from the start of the journey since the acquisition.

At the same time, as you see and as I showed this morning, we have refinanced 50% of the debt. So from a debt maturity profile, we are with a balanced maturity 3.4 years of average, and we have the diversity of funding. So we have a stronger and more resilient balance sheet that we can start with. Looking to '28, company will be more focused and more disciplined in fact, with a disciplined capital allocation and it's restoring the financial flexibility. How we will do that?

It's about the 2 clusters because it will mean differentiated management, differentiated investment allocation, selective investment. The second is that we consider a further selective portfolio optimization, as you have seen, and I will go in more details we are contemplating an additional divestiture in the value cluster to further sharpen the profile of the group.

So as a result of this, by '28, we aim to be at 1.2x in leverage, which is setting to be eligible for investment grade, given the metrics of this industry. And this is enabling us in fact, to unlock the growth in the selective technologies and addressable market that we want to address in electronics and Seating, but with a clean and solid balance sheet.

Now what is giving confidence in fact, in this trajectory. But the first step is what Martin was calling the year 0 of the plan, which is the achievement of '25. I will not come back in a lot of details on this, but clearly speaking, 40 basis points improvement in operating margin, and this is coming from cost reductions, improvement of the net cash flow in both quantity and quality, up 47% in quantity and in quality, much more recurring because it's based on EBITDA improvement and reduction of investment.

And as a consequence, the evolution in debt and leverage that we mentioned earlier on. And on top, inside this, there is a better utilization of the cash we have because we have reduced the gross debt not by EUR 600 million, but actually by EUR 900 million, and there is further progress in terms of utilizing the cash that you can count on in '26 by around EUR 500 million.

So that will help the reduction of the financial cost even more. The second -- of course, the second element that is giving a solid situation will be the planned divestiture of Interiors. It's a pivotal milestone. It's changing the profile from a portfolio standpoint. And we will be able to be more technologically driven in the new setup of the company.

You see the evolution in terms of profitability since Interior is actually dilutive today. And you see, as I mentioned earlier today, the debt reduction, and I want to stress again that, in fact, you have to look at 2 metrics, the net debt reduction, but also the gross debt reduction because we will simplify the structure, less joint ventures, less complexity in terms of location, means better cash management, easier to create cash to consolidate the cash pooling.

It means gross debt reduction of 1.4% and the financial cost is associated to this number. On top, you have a complement, which is -- if we're less joint ventures, we have less dividend to minorities, that is also helping the translation of actual cash flow performance in net debt reduction.

Now the second message is about driving the portfolio, driving the mix in a way. So we have shown you that we are differentiating the different businesses between the growth cluster and the value cluster. But what are the relative weight of them? We will start with basically a 50-50. So you see that in '25 pro forma of the divestiture of Interior, we are talking about 50% of the business in growth, 50% in value. In '28, we will be close to 60%. And leading midterm to 2/3 on the growth cluster in -- given that the growth is automatically in the first one.

So -- and it means that the sales growth potential is increasing accordingly. And let me go in a bit more detail in each of those clusters. So starting with the Electronics and Seating growth cluster. Here, what do you have? You have an Sébastien, Peter presented in more detail the different businesses, but you see the trajectory in terms of growth.

Electronics, 10% CAGR, 15% to 28% at constant ForEx, accelerating afterwards with the expansion of the benefit of the leadership position that you imagine and with the technological advantage. In terms of Seating, the 2% is for '25 to '28, accelerating afterwards. Now the growth in Seating is a bit different. It's about enlargement of the CTV and enlargement of the market.

So you can derive that, in fact, the embedded growth of Seating is more than the embedded growth of the car market volume because we are attacking markets in which we are not present today. So CVI and India. In terms of profitability, first of all, you have a mix advantage the more electronics, the better the margin.

The second, you have the cost efficiency and competitiveness on both R&D, but also in terms of operation. I think some of them are also related to what was mentioned on the operations. So we aim to be above 7% on this activity. And if you take an aggregate CAGR of this growth cluster, you are at an aggregate CAGR of 25%, 24%, but actually 6 after '28, which is giving you the potential of this evolution.

The value cluster here, you have 4 businesses today, and -- as mentioned earlier by Martin, the situation are not exactly the same. You have 2 groups inside. You have Clean Mobility, Lifecycle that are already solid cash conversion. And I would say Clean Mobility, given the evolution on the electrification as a bigger value than it was 2 or 3 years ago. And clearly, we are very happy to have it.

And Lighting and Clarion -- Lighting and Clarion data in need of repositioning and competitiveness recovery. From a revenue standpoint, you can expect organically to be basically flat between '25 and '28, but you see that the drop in revenues that we are showing here is related, in fact, to potentially having additional divestiture if and when concerns are met and appropriate inside this domain that will even more solidify the evolution of the balance sheet, but it's only if it is meeting the conditions that we set ourselves.

So that's why you have -- in fact, on face value, a decrease in revenues inside this cluster for the period. From a profitability standpoint, we expect to be also here above 7% by '28. This is coming from cost reductions. This is cost reduction, competitiveness in particular, Lighting and Clarion and to further develop the profitability in Clean Mobility and Lifecycle. We know that were, for instance, Clean Mobility, we have some possibilities compared to benchmark.

What does it mean for the aggregate company? And this is, in fact, starting my third message about what it means in terms of improved financial metrics for the total group. First of all, selective growth, 2% organically over the period, '25, '28 before this potential divestiture. The second is about sustained cost actions and recurring cash flow conversion that I will show in the next page.

So evolution on revenues, the growth is coming from the cluster of the same name. And in terms of profitability, you see that the majority of what we expect an improvement in profitability is coming from cost measures in both -- actually in both clusters.

So not only value but also in terms of the growth -- the growth cluster. The volume and mix, and I would say almost first of all, the mix is because we are driving the evolution of the mix with the development, in particular, in electronics. So overall, to be above 7% over -- by '28.

Now the conversion in cash flow. We are -- you see that this graph is continuing to talk about a bit 2 metrics, the net cash flow per se, but also the quality of the cash flow, i.e., the recurring net cash flow. And here, what we are aiming at is, in fact, to have a cash flow that is improving, more solid, more resilient and actually less cyclical.

So the expectation in '28 is that there will not be a contribution from working capital, which is still much smaller but still the case in '25. So it comes from the rest. It comes from the operating margin improvement by 100 basis points. It comes from investment clearly below 7%. It comes from restructuring normalization by '28, we will have completed the big wave of restructuring that we have to do that we are underway, EU-FORWARD on one side, Simplify on the other side. And you will have, of course, the reduction of the financial cost, the reduction of the debt that we are doing in the meantime is and the repatriation of cash is improving our financial cost, and we expect to be clearly below EUR 400 million by '28. And last but not least, is normalization of tax, and I believe that we can do better after '28 on the tax profile. The tax will be stable in value because the increase in operating margin is one thing, but the other side is the geography. Geographically speaking, we have countries in Europe, for instance, in which we are losing money.

So to recover the situation in those ones is not, in fact, having the tax impact per se. So the focus is to have not only the 3.5% of net cash flow that we aim at for '28, but in fact, what we call the recurring net cash flow going up between '25 and '28. In '25 is actually at 3%. And we expect to be, as the graph is showing it, in fact, above the 3.5% in '28. So not only the value but also the quality is what we are aiming at, so that we have a situation in which the cash flow is more solid, more recurring and more resilient to whatever fluctuations that can happen in terms of volume or activity.

Now what does it mean in terms of capital allocation policy? First of all, we aim for a solid financial structure, not only short term but midterm as a company. And this is the base on which we will do selective growth in the domains in which we believe it makes sense.

The second is that we remain committed to long term in capital return to shareholders. There will be no dividend proposed on in '26 on the results of '25, but we have clearly the goal that at the end of the day, all the metrics and all the parties need to have the return. So the policy that we set ourselves is, in fact, to say dividend and share buybacks will take into account the group financial results, the growth financial position, including the leverage level.

So as a bit of a conclusion for the overall financial framework, what will be FORVIA in '28? So FORVIA in '28, you see the numbers. sells EUR 21 billion to EUR 22 billion at constant ForEx. That includes the potential divestiture that we contemplate in -- we could contemplate in the value cluster.

So in fact, it means an organic growth of around 2% for the company over the period. Operating margin above 7%, actually balance between the 2 clusters and with the distribution of profit I would say, more spread. Cash flow at 3.5%, but with a better quality and better recurring, lower financial cost, not counting on working capital contribution, annual leverage at 1.2% compared to the 1.7% that we have at the end of '25 and the 1.5% that we have -- that we expect at the end of '26. So in summary, a more solid, resilient company in full capacity to seize the opportunities that we presented this morning, in particular, in Electronics and in Seating while keeping the rigorous financial discipline that this industry requires.

And on this note, I leave it back to Martin for conclusion.

Thank you, Olivier. So quick conclusion before we get into Q&A again. So IGNITE is a very clear and step-by-step path to success. We drive what matters now and unlock what's next. It has the 3 elements: best-in-class performance.

Here, it is about disciplined profit generation, cash deleveraging and deleveraging of the company. So we reinforce the foundation, right? You heard about from Olivier about the quality that we put into our operations and beyond, that is going to drive that reinforced performance we need.

Then second, we have business transformation. We do that with utmost discipline and focus. You heard about the value cluster and the growth cluster. And we are very disciplined in putting the businesses in there and capital allocations follow suit. So it is important that where we play, we lead. It's not about the sheer size, but it's about scaling in our successful activities.

And then last not least, invigorating our culture. It is about accountability and empowerment. We want to do and make decisions at the right level of the organization at the point of business and use, and that will develop agility and the performance we need.

So personally, I'm very confident that IGNITE is going to deliver sustainable growth and the financial results our investors wait for and with that, a good long-term value that we are going to generate for FORVIA. So thank you very much for your attention this morning. We now build the stage for Q&A.

We'll start from questions from the room for those joining remotely. [Operator Instructions]

Stephen Reitman from Bernstein. First of all, a question about China and about, I guess, working capital. Could you comment on what has been -- what the developments you've been observing in terms of payment terms in China? Have there been changes? Have the government regulations had a material impact in terms of shortening terms -- and is that having any positive impact as you're obviously increasing your exposure to the Chinese OEMs?

And secondly, I guess a question about on Seating -- sorry, on Lighting. Obviously, we've seen it. You've moved it into the value category. To what extent does this reflect the SDV move the sense that the total value of those units you're selling has moved from modules -- complex modules to more components. Do you see any other part of the business that face that kind of pressure as well? And can you talk also you talked about maybe moving toward volume strategy on the Lighting side? Is that to compensate well to for this reduction in parts per value per part or so?

All right, Steve, let's get started then on China on the working capital. So we have not seen much of a change happening on the front, and at the same time, we are very consistent on how we handle our working capital between what's happening on the customer side and on the supplier side.

So we don't get into the position of a bad middleman but we translate pretty much the terms that we get from customers to the suppliers. And then the second question on Lighting. Very good question. How is the value generated in Lighting products.

You still see additional value that's coming from new products. So we have traditionally been strong in headlights and taillamps and lamps. You now see a complete new suite coming up of car body lighting solutions. And one of our showcase is the new BMW iX3. We have that beautiful face, right, certainly with the headlamps, but with many more lighting elements. So that is a trend that benefits our revenues.

You're also right when you say, how is it modularizing, how is it getting to be more standardized. So let's go back to a headlamp. Yes, we have very strong light modules that are getting standardized and platforms so we can scale volume with that. That's another trend we face. And Peter taken over, that's something, and we want to go into the volume segments where that platforming becomes more and more important.

Yes. And beside platforming because you talked about SDV, yes, you're right, some functionality maybe will move from lighting electronics onto this centralized EE architecture, but that it moves directly on the modular systems where we -- with our zonal modules will play a role as well. So it's more a shift of value from here to there. .

It's Jose Asumendi. A few questions, please. Just back to Lighting, can you explain a bit better -- just go through the concept again of how to improve the margins within Lighting? Is it growth across some of the regions? Is it cost savings actions and how do you come to that growth maybe in China as well?

Second, on cost savings for the group level, can you explain what are the key actions to drive margins higher? I mean cost savings was the biggest bucket in your profit bridge. Just give us some examples of that. And then three, Clarion, what are the levers also to improve the profitability in this division? And is this division also potentially for sale? Or is this a division that is performing in line with your expectations?

All right. Good questions. Jose, thank you. Let's go in the sequence that you posted them. And Peter, maybe you're going to comment on the opportunities that you see in Lighting in terms of cost improvements and was also an element of China coming in for Lighting.

Yes. I think there are different things we focus on. On the one side, in Lighting, for sure, we have a performance optimization program ongoing, you heard already about the Simplify program or our European focus program, which we call Eagle, which is about it's ongoing. So it's focusing on operational improvement, R&D improvement, efficiency improvement, all those classical things, classical improvement programs. .

In addition, Martin already talked a little bit about that. We will work more on the design, working on platforms and that having as well the opportunity to step into the volume segment. And we want to realize growth in China. And China growth can only happen specifically with Chinese OEMs, if you work in China for China. That means local R&D, local operation, local sourcing, empowerment of the local organization and all of that in Chinese speed.

Then, Jose, I would come to your second question, how do you get to cost savings and better results, therefore. We talked about the 2 big initiatives EU-FORWARD, that's taking cost out. Same thing for Simplify where we are seeing significant potentials for fixed cost reduction. And that's also what Olivier had in his bridge to highlight how much more potential there is. I want to reiterate on the Simplify target. So we are shooting for EUR 110 million in cost reduction by 2028. We are going to see a first impact now in 2026. We want already make it to 40% of that savings potential. So put measures in place that allow for the first 40% to get into gear. And then I think it was also important Olivier, maybe I want to look a little bit deeper into operations and how do we drive performance, how do we drive productivity in that area?.

Yes. So the first one is to continue what I explained on our FORVIA Excellence System by dep, we have a very clear link between the compliance to our system and the profitability of our plants, which I think looks obvious because if you apply all the best practice, you deliver better. So we concentrate to put all our plants on the right corner,. The second one, automation, smart automation, boosting automation everywhere we can with a short payback. .

We have also all the actions we do on our supply chain, mixing on one side, very cost effective, but also the maximum resilience we can deliver. We are working also actively on our transportation cost because when we reduce transportation cost, we gain on our costs, firstly, we gain on CO2 and also this is helping to drive a better reliability in our plants. So these are a major actions we have launched on the top of our digital transformation and AI that I explained before.

Okay. Jose, you had one more question on what are the levers on Clarion. So first of all, the results in 2025 already show that we are substantiating the performance to a much better space. And this has worked on 2 levels. So we have simplified also for Clarion in the organization. We figured out that for EUR 1.4 billion business, there was too much matrix happening. So we are taking that back. That helps. And then the other lever is really in the R&D space, where we have to create software platform that can serve various customers cannot be too individual in all these developments. And I mentioned earlier, we're also looking for partnerships in that field that we can reduce on various levels of software, our own efforts, that's going to drive profitability.

Christoph Laskawi, Deutsche Bank. I'd like to start with first question on disposals, further disposals or potential for that. And coming a bit back to what Thomas asked initially in the first Q&A. If we think about the signs that you outlined, it could fit, for example, Clarion that you just also highlighted can improve margins. What is your strategy for the disposals? Would it be this division? Could it be just smaller stuff? And if we think about Clarion is that already fully carved out? . I would think it is. And so that will make it easier to relatively quickly sell. And looking at LCS and other division that would fit the size, I think it's rather unlikely because of the ownership structure, if you could comment on that.

Second question would be for Seating is obviously currently a trend ongoing to reshore production into the U.S. which probably puts U.S. competitors a little bit of an advantage relative to your industrial footprint right now? How do you cope with that? How you're competing with them both and India, again, are relatively outspoken to gain share currently? And then lastly, just on electronics, obviously, quite impressive growth targets. Could you comment a bit on the regions that are driving that? And is there any margin difference by region? So within Electronics, is there a mix effect mostly in the improvement? Or is it simply operating leverage on scale?

Thanks, Christoph, for highly strategic questions. Let's get started with the disposals. So right now, the full attention goes to the intended divestiture of Interiors. And think what got us to that point, there is a strategic consideration to really strengthen the portfolio, but there is also the need for the cash that we bring that down.

So once we do that Interior, plus we continue on our good organic deleveraging, we have a little less of a pressure than before. So when you look now to that 2028 horizon and we reserve for EUR 1 billion of additional divestitures. It's not top priority right now. But across time, we will see what qualifies? What can be done? We are interested by us. So it's by far too early to speculate on one business over the other that could qualify for those divestitures.

So EUR 1 billion in sales, just to tam down any expectation.

Way to, EUR 1 billion in sales. Go then, let's go to Seating. You said, what's new in the U.S., right, with the push from the administration to do more locally and all competitors pushing into that market. Sébastien, certainly one for you to say how we're competing.

So I confirm that North America is really a strategic pillar for us, for our growth, especially in the U.S. of course, on our innovations, but as well as our industrial performance, which is really improving. We work specifically on automation in the U.S. to further reduce our cost. And I want to share with you one example of our success FORVIA Group announced the win of a major contract in North America, more than EUR 1 billion, with a European OEM and sitting as a big part of this win. So clearly, the U.S. remains a clear strategy for us and a priority.

Okay. And third question, Christoph was on electronics, and we have significant growth targets. Yes, they are global in nature. And when you think through some of the products that Peter explained, it's very important that we go global and scale. So remembering back the zonal modules where it all starts from a little chip from an ASIC that we developed, a lot of IP, a lot of know-how enables the upscaling into the full zonal computer. All this lifts from volume. And that's why we are targeting the global market with all these product lines. And Peter, I'm sure you have a couple of more forts on that as well?

Yes. At first, the growth will basically happening balanced worldwide. We have a specific focus on Asia, China, India, Japanese or Korean OEMs and on North America. Besides the scaling for sure that comes with the localization of manufacturing, which we are targeting for and you asked about margin distribution that will be balanced somehow across the regions in the sale. .

So Manuel Capone from Banco Itau. I wanted to ask you regarding the Latin America region. I think it has not been mentioned within the presentation this morning. And I was wondering if it's still a strategic hub for the group? And if yes, to what extent, please?

Yes. So in that region, we operate by about EUR 1 billion, and it's a very fine region for us, both in terms of development of the business. It's also a profitable business that we enjoy. So we are very present with all the various business groups. And in the best spirit of IGNITE culture, we empower that team very much to serve the local market with all its specificities, right, with that have a wave of inflation and so on. So a very capable team who drives that business. Here and there, we even developed specific technical solutions to serve the specific market needs. So we are definitely holding on to that. It's valuable.

Vanessa from Jefferies. And I was wondering if you could just talk about the commercial vehicle growth strategy you have and what have been the barriers to growing that in the past?

Yes. Good question. So first of all, barriers I would not have even seen. It was just not a really strong focus of the group. And now 2, 3 years ago, we started realizing that's really an opportunity. And we go business group by business group to develop that. So I would say it's even more established, Peter already on the HELLA side. Many want to talk to that a little bit, and I'll pick it up for.

Yes. In HELLA, it is under Lifecycle Solutions. It's a subbusiness group, where we are already strong in Lighting in some areas and where we develop further now in Electronics because sooner or later as well, commercial weeks will go in the direction of these new EE architectures, and that provides for us a new growth opportunity to step in.

And we heard from Sebastian earlier this morning, what that means specifically to Seating. And there's other business groups where we now prepare their respective product lines and an organizational setup to serve these customers. So that's a full swing.

And then I don't want to detract from the great opportunities you've presented today. But it's interesting, a lot of your peers are talking about the nonnormative opportunities like data centers and defense, et cetera. And maybe the only 1 who isn't -- why have you chosen to go that route?

Well, we are in Phase 1 of IGNITE, and that's all about focus and strength, and that's what we do these days. So we have a lot of opportunity both on the cost side, also in growing with our key activities. So that's where we want to focus. We are not ignoring those spaces, but we look at them really for adjacencies. So we are testing into fields like defense, where we say where does technology translate good in that new sector. And if it's adjacent enough, we consider it, but we are not going to go into a big investment that right now we cannot afford.

That's where we stay. We focus and we strengthen who we are today. We get further on to lead and grow, right, and have the financial flexibility for that as well, then those fields are relevant for us, too.

And then lastly, you've talked about replicating the success you see in China with your efficiency and shorter development terms. We've heard this a lot for the last couple of years from all of your peers. And what are the barriers to doing that still? I mean, would your customers say, it's you guys and you guys would say it's customers.

I would say it's our customers and us who have to break through because all decades and decades and decades. We have developed a very solid way to do automotive business together. But it isn't all fragments also a very slow way of doing business together. And right now, Vanessa I really sense, a good motivation, right, a good pressure, particularly from the Chinese market that makes OEMs and us Tier 1 suppliers FORVIA get closer together to really tackle it. So this is a discussion today in the management boardrooms where we are on the highest levels, we say, how can we bring in ocean much faster in Europe and North America as well. And it's going to be a leadership act rate. We have to influence very positively our organizations from the top to get to that speed we need to be globally competitive.

Thomas Besson. I'd like to go back to my initial question. So can you explain what's going to drive the return to growth in '27? '26 is the third year of revenue decline versus production accelerated in '26. And can you explain how you can grow and maintain a limited CapEx at the same time and you don't plan any more cost saving plan after 2028, which I find a bit surprising, because usually, there's always a saving plan in this business. .

Second topic on Seating. So you've explained that commercial vehicle was becoming possible. It was impossible before. Can you explain what has changed because before we were told it was a too small market. It was different types of seats. They were not in a feat in the trucks and these kind of things. So why don't you do seat for aircraft the technical, they are more valuable? It's also adjacent to some extent, maybe it's for the next phase of the plan. And can you explain if you have had any wins with Japanese and Korean OEMs because I haven't seen that you've talked about it and I haven't seen it. They tend to be quite integrated or they used to be integrated in Seating. And lastly, maybe more for Olivier. In '25, you still had 3 underperforming business. Interior that is going out, but it's still going to be in your accounts in '26, Clarion and Lighting. What was common between these 3 businesses? Is there any accident industrially in the U.S., is there any execution issue with any reason for selling Interior and keeping the other 2 underperforming businesses?

All right. That's a mouthful. That's free to have 3 questions, Thomas give the best to keep us all organized around that. So when you start on order intake, and how are we going to return to growth in 2027. That's exactly what's happening. We are going to benefit from the order intake of the last year that's going to push growth forward. And when you see what really holds us back end of last year, early into this year, it's predominantly that customer mix that we have seen in China.

So okay, this is now booked in, and we look forward from there. In terms of CapEx limitations, how can we keep that in check in spite of the growth? Well, you see how low we are in 2025, and we announced that we will be returning to a certain degree, but keep it clearly below 7%. So I think that describes and quantifies very well the range we have to maneuver and how we are going to allow for that additional growth.

Then you asked also how about future restructuring. We can't believe it's all open and all ended in 2028. What we translate into plan is that in 2025, we really had the peak and cost, now the cash is going to come after. And from here, we are tempering off. I would say, EUR 100 million of restructuring cost in a given year is probably the level we are going to sustain, but you know that we are coming out of times now with EUR 400 million a year. Good and Seating. What's different? What you -- why now commercial vehicles? Sebastian? So what's happening?

Well, it's possible now is because we have developed a complete new set of seats dedicated to this market. The technical requirements are different for us and we have developed new solutions, both in-house and with partnership and now we are able to address this. We have 1 already major contracts entering into production in 2027 is expanding as well our growth after 2026 because it's entering into production and already we are planning to grow now significantly.

Our strength is that we are able to combine the new product with our and wellness solutions. We have developed for passenger cars. So that's why now we are going very fast in this market. We are not planning to expand where aircraft technical requirements are currently different volumes as well. So no plan for the time being in this field. Japanese and Korean OEMs. So yes, we are going. I did not mention it, but we won contracts with Korean OEMs, both in Korea and as well outside. And in Japan, with Japanese OEM, we are building a new plant that will enter into production this year.

Good and last at least, Thomas, you had a question on Clarion Lighting and. What are -- are there any patterns right, for performance that we want to improve. I would give free characteristics on Clarion, we talked about over structure and too high R&D costs. Lighting is different. I think, Peter, it's fair to say that we suffer from capacities we have built for a much stronger Europe market when it was still in the 20 million vehicle range, not at 15 million. So we got to get that out of the capacity. And on the Interior side, yes, you're all well aware, we did have operational struggles in North America in the last 2 years. And Olivier, you described very well how systematically, we have introduced FES to fix that, and you also mentioned a number in terms of margin improvement that we have seen.

So there's not that common pattern but 3 cases where we have to act decisively.

Yes. Ross McDonald, at Citi. Three questions. Olivier, firstly, on cash return. Just be interested to push you a little bit more on dividends and buybacks. I think the consensus for '26 has a small dividend in there. I'd just be curious how you think about the KPIs for moving back towards cash returns, how do you think about the mix between dividends, buybacks when we get there? And then linked to that, if you do a dividend of EPS or if you consider thinking more about holistically the cash generation and using any surplus cash for buybacks and dividends?

Second one on electronics linked to Christoph's question maybe in a different way. Obviously, it is a growing part of the order bank. Are there any specific platforms within there any customers? You mentioned it's diversified by region. But for that growth to crystallize, are there any specific OEM SDV platforms that we should really focus on? Final question is a big one, specifically on AI, you've talked a lot about AI benefits.

I think it's fairly obvious that suppliers can get the R&D down and that's a huge opportunity. How do you think about holding on to those savings? Because obviously, AI can be deflationary. So how do you make sure you retain those AI P&L savings? And then linked to that, what should we think about EU R&D head count in the group, steady state because a lot of the R&D expense is, of course, labor expense? And final point on this, you talked about restructuring costs normalizing in 2028. If these AI tools are as good as we're led to believe, how realistic is that? And can you maybe remind us what is a normal level of cash out restructuring for a steady state.

All right. Olivier, you want to go ahead on the dividends and the general cash returns.

So I think for the time being, the priority is very clear. It's getting a restoration of the balance sheet and to have the right financial structure. So I think the decision -- the recommendation to be clear, the recommendation of the management and then of the discussing the Board and recommended by the Board to shareholders for '25 results. I think it's fairly obvious. We need to have our balance sheet fully restored, and this is not yet the case.

We are on a good trajectory, but we need to get to 1.5, and we need to have the closing of Interior. Now going afterwards, I would say it's a question of having all the metrics being back in place. And it will be an individual decision with the Board every year, taking into account not only net income and EPS, but also the actual financial situation. And if I made the context externally. So I think it's a cautious -- it's a cautious policy. And I think for the time being, this is what we should stay on.

Now related to dividend and share buyback. If and when we are at this situation, probably we will look at both elements we know perfectly that the operation went translated in a fair amount of dilution in back in June '22. So we have this consideration as well. So that's what is the most effective way for having a return to shareholders, and it can be either of.

Good Second question was about electronics. Are there any specific vehicle platforms customers we target. Peter, where are we?

Yes. As I mentioned in my presentation, we have somehow the expectations that 60% of the vehicles produced in 2030 will be on these new platforms. We actually announced that we have EUR 1.5 billion already sales in our booked. Those bookings are coming mainly from European OEMs. We are now talking with North American and Asian OEMs about the same. So in the future that will be distributed. And due to the fact that these new EE architectures will be so much more efficient and needed for software-defined vehicles. It's not a specific platform any longer. All OEMs are moving step by step now in this direction. .

Good. And then Ross, third question around AI. How do we generate these savings and important to you, how do we hold on to these things, right? And then probably there is an attachment of the fourth question as well. What does that mean to R&D forces maybe give the AI please.

First of all, we -- as I explained, we focused a lot on digital first, data, real-time and we know exactly what to do with our data and how to boost performance through that in our plants or in our development by the return of data as an experience.

What we have launched is a very pragmatic AI scaling. And we and all 4 are in what we call the AI transformation studio. So we have a monthly review where our team members are presenting their projects, and we finance them then month after month. And I think it's clearly answering your question, that means we first scale the project onshore the payback, having the KPI to monitor the payback and then we launch the full investment for the project. So it's why we start by 30 agents, which is our first starting point. But with the studio, we really want to be systematic and dramatic as our strategy to really leverage our end-to-end processes and step-by-step generative AI, but on a very pragmatic way.

So to your last point, what does that mean now in terms of also restructuring and possibly continued restructuring. You remember Project Simplify is something where we work into our overhead structures into the SG&A adjustments as well. And a good part of those savings will rely, in fact, on artificial intelligence. So we go through our process end to end, take complexity out of the processes and then bring AI to work off that. So when we talk about the savings of Simplify, but also the restructuring office -- efforts that we have quantified as EUR 150 million roundabout. That's already part of AI effects that you can see in these numbers as well.

And maybe just to make sure that the understanding of -- it does not mean no restructuring. It's -- the envelope that we are considering is EUR 100 million, EUR 130 million cash out of a restructuring because new technologies, new processes, the mobility of the activity. So it's not when we -- I mentioned normalizing is normalizing compared to the big wave we have done, but it's not assuming that there will be nothing to do in '28. .

Is there any question in the room before we move to the chart? Yes. One last question.

Michael Foundoukidis, ODDO. Two last questions on my side. First, we talked a lot about Chinese OEMs, but what about suppliers. We see them more and more notably in electronics, but not only in Lighting, for example, and not only in China, but elsewhere and in Europe. What's your take on that? What's their behavior in terms of commercial policies, this kind of thing? That's the first question. Second one, still on electronic and following up previous ones.

What's your view on where OEMs -- legacy OEMs stand on -- do you see them as more stabilized in terms of specifications, meaning that the risk of further delays is more limited than before? And how do you assess that? And what would be the possible impact on your action in this business?

Okay. Let's start with the Chinese market and competitors that we have, certainly in the Tier 1 space has been part of the game for the last couple of years across the range of products. And for us, it means we have to play strong, which we do. It starts, first of all, with our local-for-local or the Empower Chinese team where from innovation over R&D to manufacturing, supply chain, sourcing, everything is deeply localized.

And that way, we are competitive. What always keeps setting us apart is that extra piece of innovation and innovation speed. So that's how we deal with that part of the competition. When I started in March last year, we were in China together -- and I challenged our Chinese team, I said, hey, we'll be back end of the year. I want you to innovate locally.

I want to integrate to the needs of the market here. And then in November, we went back as the Management Board as the Executive Committee, now we could look at 30 brand-new processes and products that got innovated there. And the speed from that innovation to really the car, you saw that with the example of the mechanical massage, right? That's quick.

So we got to feed our engine over there really continuously through innovations. Then on the electronics side, where do the conventional OEMs stand still on the way and they are on the way. So with what Peter described in terms of the more centralized architectures and having zonal architectures now that's becoming stronger and stronger with quite a few of the Western established OEMs.

And I believe that transition into new electronics architectures and software structures is really mandatory and a recipe for finally success in that direction. Playing software-defined vehicle and an old electronics and electrical architecture is just not working. So that's why we are now playing on that trend, so heart of zonal computers because it's taken off.

And you're right, some OEMs in the Western world struggled for some period of time a little bit with those new architectures, but that is stabilizing now. And I think we can support them with our know-how in the areas I mentioned.

And imagine what that means for us as a company, I mean, I talked about this change of value add. If the value add is concentrated on domain and zonal modules and we are going into the zonal modules with our one-stop shop solution. that is providing another good opportunity when all the OEMs now step by step go in this direction.

Then we'll go to the questions in the chat. The first question is coming from -- thank you for your time in the presentation. Regarding FORVIA Interior sale, do we expect any risk for the group in terms of operations following the disposal of this business regarding plans, tech or IT. Second question is coming from Karl Galen from APG. In view of deleveraging having priority, can we rule out FORVIA buying both minority shareholders in her before 2029? And last question still from ABG. With the expansion of possibilities in seating, for instance, 0 gravity. Do you expect to capture additional margins from passive safety systems, which have high margins moving into the seats?

All right. Very strong questions. So first of all, Interior risk no, let's say, risk from the intended interiors divestiture, that's the right question to ask. Those risks are limited. So as part of our choice, why do we divest from interiors, one consideration is it's a pretty independent business. So OEM source Interiors business separate from seating and so on. So there is no interaction between these businesses, first of all. And then when it comes to really operational carve-out, we have dedicated plants for our interior business.

So there is only a very few minor 2 or 3 plants where Interiors would share space with other business groups. So the carve-out can be pretty clean in that regard. Obviously, once we get to that point, we'll have a dedicated carve-out and transition team that takes care and is going to mitigate any kind of risk that could come up.

Then the second question regarding HELLA. And I think the question behind us is we are intentional about purchasing the remaining HELLA shares from minority investors. And this remains not to be one of our priorities. So as you heard us say before, we keep working and that set up that we have -- we have found very good and safe processes to drive strategy, to drive synergies. You see the new level, we have reached EUR 400 million in synergies. So that is not one of priorities. We will focus on the other elements where we strengthen our portfolio, as discussed through IGNITE today.

And then the last one. Sébastien, our passive safety device is going to enter the seating space.

So indeed, we can see more and more content in a setting, especially in Asia and in China, in particular, whether it's on safety or wellness and comfort. So you mentioned 0 gravity, yes, it's a fact. We have an innovation, as I mentioned earlier, the S60 where you can incline your seat while being in a safe condition, and it is pretty new. And this additional content is generating for us additional revenue and therefore, additional margin. So I can.

One addition, you heard me talk about partnership in various areas in that passive safety, seating integration, we are partnering with Auderlif. So we have a very strong firm by our site to again push and drive the trend there.

Thank you, everyone, in the room and off-line. This is all the time we have for today. The floor is back to you, Martin.

Okay. That brings us to a final statement on time, that's really well appreciated. So maybe we can have the respective background here as well for a little summary. So I think there's 3 key takeaways. We got you through the IGNITE story, and we spent quite some time and repetition, so I won't do that. But the 3 statements that I want you to leave with from that conference here is FORVIA performance is improving in a very strict and strong manner.

And 2025 was the first year to prove that. Second, in terms of portfolio, we are focusing on the most competitive assets where we have the strongest right to win, and that's what we want to scale, right? And the third point, IGNITE that together, there is a clear path to enter a growth trajectory on sound financial footing. That's important, too.

So those are my 3 key takeaways for you for that day. And I want to thank all of you for being here. And I truly enjoyed our very active dialogue here. So your questions were both financially oriented, also very much strategy-oriented. And I hope we can drive that business forward together in that good sense. And then a big thank you to FORVIA team, to the FORVIA team as a whole for what was the -- what was a powerful and effective year 2025, and then to all the thinkers and helpers, who made that day possible today. It was a great effort, but was also utmost important for us to convey where we want to drive for FORVIA to. So thanks to not only the speakers, everybody behind the curtain as well, you made it possible.

With this, I want to invite everyone here in the room for lunch. You know the area by now. And thank everyone on the phone and on the screen as well. Thank you very much. See you for our next event.

Good morning. This is the conference operator. Welcome, and thank you for joining the FORVIA Third Quarter Sales Results Conference Call and Webcast.[Operator Instructions] At this time, I would like to turn the conference over to Martin Fischer, CEO of FORVIA. Please go ahead, sir.

Yes. Thank you very much, and good morning, ladies and gentlemen. Thank you for joining us today for our Q3 2025 sales call, which I'm presenting together with our CFO, Olivier Durand. I'll start by sharing our third quarter highlights, then Olivier will talk you through the details of our Q3 sales. And in the end, I'll wrap up with our outlook for the full year 2025.

By now, you all know the 3 priorities we have set for ourselves, best-in-class performance, business transformation and invigorating our culture. They are now firmly embedded in the way we manage internally and stay also determine how we engage externally. I'm very pleased to highlight the progress that we made in Q3. First of all, our best-in-class performance. We operate in an uncertain market. Customer mix volatility in the third quarter added to regional fluctuations already amplified by the tariffs.

Nevertheless, sales proved to be resilient, and it was flat in Q3 and slightly up organically over the first 9 months of the year. In such conditions, the focus is ultra clear. We maintain discipline in operations and launches. We keep tight control of cost and cash and thereby offset all the market volatility.

Thanks to the discipline and despite mounting uncertainties, we are on track to deliver on our 2025 guidance as presented earlier this year. Second, our business transformation is moving forward. Starting with our divestiture program. We have a target to sell additional sizable assets. And for those, we have received strong inbound interest from both private equity and strategic players. The divestitures are progressing according to our plans. And at this point in time, we still will not comment on market rumors and any speculations around those.

At the same time, in our target business portfolio, which we will present at our CMD in February 2026, it will indeed reflect a simplified group structure, focusing on product lines with clear leadership positions and a disciplined approach to capital allocation.

Thirdly, let's come to invigorating our culture. The new division-centric model that I presented during our half year results call at the end of July is now in place. Also, the simplified project that optimizes SG&A and indirect costs has resulted in immediate actions. The governance structure is established, and we drive short as well as long-term initiatives under simplify.

Last not least, there has been further personnel changes in essential functions. [indiscernible] Was appointed as CBIO in charge of artificial intelligence, digital and IT. And second, in order to drive our innovation internally and together with partners, Vanessa Picron was promoted to Chief Technology Officer. So as stated before, we enforce the most important functions of the company that serve our mission.

So speaking of technology, our goal is very clear. We position the group to lead the transformation of the automotive industry. And in the third quarter, we continued to leverage market dynamics. I would like to start with the technology trends. Electronics are at the heart of the transformation, that's very obvious. And this activity keeps growing at a double-digit rate at FORVIA. The Q3 growth was majorly driven by radar products and in-vehicle in containment systems.

As a specific product announcement, our new radar generation ForWave7 has just received the first award and it provides good solutions to key environmental data generation for advanced automotive -- automatous driving, excuse me. Secondly, Clean Mobility is also performing very well in Q3. It benefits from the slowdown in full electrification and the growing shift towards hybrids. Thanks to our leadership, the business continues to consolidate the market. This is very well illustrated by the recent SOP, after taking over ultra-low emissions products from a German OEMs in-house production.

Next one is Seating, and Seating constantly keeps innovating at fantastic speed. We presented the new Zen Massage seat at the Shanghai Autoshow. We talked about that in an earlier call. And now it will soon be featured on the LS9, the new 6-seat luxury model from IM Motors which is the joint venture between SAIC and Alibaba.

Lighting is moving ahead too. After the success of its FlatLight rear applications using micro-optics, the team is now bringing it to a front version. And in parallel, Lighting also received several awards in Q3, especially in the Volume segment. This underlines the scope extension of the Lighting business from technology leadership to mass market penetration.

So let's move on to the next. In parallel to relying on our strong technological edge, we also pursued our diversification strategy to unlock untapped customer potential. We are happy to supply our Asian customers when they serve global markets. In Europe, we won a new interiors program with Toyota for an electric vehicle car line. Also, we secured our first Seating order with HKMC outside of Korea, delivering comfort modules, both in Europe and in the U.S. The same holds true for our Chinese customers, where we have just signed a letter of intent to extend our partnership with Chery, beyond China.

In the Chinese market itself, we further broaden our customer portfolio to become more robust against customer mix volatility. Let me give you 2 examples. Number one, we've added a fast-growing EV player from outside the traditional auto industry to our panel. And number two, Lighting received numerous awards from Geely across several of its brands.

And last not least, India is emerging as a new growth market. And after my visit earlier this month, we have reemphasized the focus on India. So we have already booked EUR 500 million in orders this year, mainly in electronics. And we are also now better leveraging our strong engineering presence in India to generate local product sales. So you can conclude our direction is very clear. We are becoming a more focused company in our portfolio, and at the same time, we become more diversified in our customers and regions.

With that, Olivier, please take over for the Q3 results.

Thank you, Martin, and good morning to all of you. Let me now take you to the main highlights of Q3 with a focus on the sales evolution, but also our recent refinancing actions. Regarding sales, as mentioned, the sales reached EUR 6.1 billion in Q3, which is down 3.7% on a reported basis, which is entirely due to currency effects. As in Q2, sales were impacted by the depreciation of the U.S. dollar and the rand versus the euro, which is the main reason of this ForEx headwind. But organic sales were flat overall with product sales up 1.1%, while tooling sales are normalizing after exceptional high levels of last year due to a record number of program launches, notably in Interiors.

Let me highlight that product sales represent the recurrent evolution of our activity. For the first 9 months, sales totaled EUR 19.6 billion, up 0.8% on an organic basis, i.e., excluding ForEx. Regarding ForEx impacts, which started in Q2, it is now at EUR 443 million for the year and should continue to weight on sales in Q4, as well as early '26 if currencies are following the same trend.

But let me highlight that it has a very limited effect on our operating margin as our cost base are essentially local in the 3 dominant markets China, Europe and North America, providing largely a natural hedge on currencies. Let me now go through the details of the Q3 sales performance across business groups and regions.

I will start with business groups. Electronics remain our strongest growth engine, up 18.6% organically, which is actually the highest growth momentum since the HELLA acquisition. Growth was strong across all regions, driven by radars and infotainment systems. Clean Mobility delivered a solid 8.7% organic growth. Two key drivers behind this evolution. First, the slowdown in electrification, we supported ICE and even more hybrid car production in North America and in Europe. And second, the takeover of [indiscernible] business from a major European OEM, which is now impacting the sales.

Lifecycle Solutions returned to organic growth after 5 quarters of decline, and we see this positive momentum continuing into Q4. I will turn now to Seating. After a solid first half, the business faced headwinds in Q3. In Europe, sales were hit by soft demand from premium brands, which included some unfavorable timing effects. In China, the growth with Chery, was more than offset by lower production at BYD and Li Auto. You know that BYD and Li Auto have reduced production overall in the period. And North America has showed modest growth supported by Ford and Stellantis.

Now moving to Interiors. Product sales were up 6.9% organically with solid momentum in China and North America. Now total organic sales of the business group were down 1.4%, which is related to the normalization of Tooling sales that I mentioned before. This normalization should continue in Q4 before stabilizing in '26.

Finally, Lighting performance was broadly in line with H1, with program phaseout not yet offset by new launches, especially in China and Europe. The business is rebuilding its product pipeline and future order intake was also encouraging with new wins in the mass market and in China.

Now moving to Page 9. We are showing a mixed picture across regions. In North America, and in the rest of Asia, i.e., Asia outside China, sales clearly outperformed market production, mainly thanks to the strong contribution from Clean Mobility and Electronics.

In Europe, performance was softer, reflecting lower volumes with premium reels and the temporary production stop at JLR. In China, market growth was once again driven by Chinese OEMs, but with some important swings inside. Chery and Geely clearly led the market, and we benefited from the expansion of [indiscernible] , but we are less present with Geely. Conversely, BYD and Li Auto registered a significant decline in production, which has weighted in our sales. In this context, we continue to act decisively on what we can control, in particular, by reenhancing cost flexibility at plant level to protect our performance and manage volatility in China and globally.

Let me close now this Q3 overview with the word on our debt profile. Once again, in the third quarter, we have been quite active in the refinancing domain we completed around EUR 1.3 billion of refinancing, which means a cumulative year-to-date number of EUR 2.7 billion. As you can see on the chart, this has allowed us to clear most of our '26 maturities and divided by our '27 maturities. We have a maturity -- debt maturity of 3.6 years now and we have a much more balanced debt situation from '27 onwards. At the same time, we have done these actions with a broadened funding sources, notably through 2 U.S. bond issuance, the last one being in September. These actions solidify our financial profile.

With this, I will now hand it over back to you, Martin.

Thanks Olivier. So looking ahead to year-end, S&P expects global automotive production to fall by 2.8% in the fourth quarter. At the same time, supply chain risks are rising, and we continue to monitor those very closely. So in this context, it is utmost important that we remain agile and focus on what we can control. We manage our costs and cash through 4 key levers. First of all, reflects the production costs to the current volumes, and we reduced our indirect spend. And we captured additional benefits from EU-FORWARD and the number of committed departures in the meanwhile, has reached 5,800 positions out of the overall goal of 10,000. So you can see the difference from our H1 reported number of 5,000. Furthermore, we deploy immediate actions and prepare the long-term initiatives on the program SIMPLIFY.

And last not least, we maintain our strict CapEx discipline as it was already displayed in H1. So with all that action, we confirm our 2025 guidance as announced at the beginning of the year. I have to say, I look really forward to welcoming you on February 24 next year to first present our full year 2025 results, and then host our Capital Market Day. FORVIA is building a simplified and value-creating portfolio, which is designed to make the company stronger and more focused.

Thank you very much for listening in, and now we're happy to take your questions.

[Operator Instructions]

First question is from José Asumendi from JPMorgan.

Two questions, please. The first one, can you comment whether you're seeing some significant production disruption in the fourth quarter from some of the related supplier impact you've seeing from Novelis in Europe? I know at least in the U.S., just more Europe related. And then second, Olivier, can you give us a bit of your thoughts around the second half versus first half key positives and negatives when it comes to that profit bridge?

Thanks for the questions. So let me get started on the supplier disruptions. As we speak, there is obviously that we have a very close eye on. One is after the Novelis fire in the U.S. and the other one is obviously Nexperia and the export limitations study faced from China. So where we stand right now with Novelis. Yes, there is going to be impact on the industry in Q4. I think customers like Ford and Stellantis are impacted of that.

So far, when we see the call-offs and how the OEMs reconfigure their business to accompany the situation, we would see not so dramatic impact on our sales numbers yet, consider a couple of EUR 10 million in sales decline, which we very well cover within our guidance. And as we commented also through flexing actions that we take on the impacted operations.

And then Nexperia, this is certainly developing as we speak. So first of all, yes, we do use Nexperia components in our products in the Electronics segment. We are watching very carefully how the political situation unfolds around it. We have made use of our voice to explain to governments on all levels, what the implications are, and you have seen that from the news as well, that there is a diplomatic action happening as we speak.

So what we do in the meanwhile is we have installed a cross-functional task force that works on all sorts of mitigation measures to ensure supply continuity. So think about it as us buying every chip we can get from the market globally. And we also prepare our products for the use of alternative components. So these are, I would say, bread and butter components, MOSFETs and so on. So we redesign our products to accompany components from alternative vendor.

And at the same time, we are in very close contact with our customers. And referring back to the Electronics components crisis, we expect that some arbitrage mechanisms will also be facilitated from our OEM customers such that we can keep up production across the OEMs as long as somewhat possible. And we will have to see how this whole situation in the end develops. And if export from the Chinese side is going to be enabled again.

So with that, I would hand over for the second question to Olivier.

So on some profit bridge between first half and second half I would say, the negative element is the volume of activity and the production volume, even though it's not, in fact, the type of that existed at the beginning of the year is expected overall to be a bit lower and this is the case also for us. The ForEx is not playing too much because, as mentioned, the cost base in the different jurisdictions is matching the one of the revenues.

Now on the positive side is the action that we are taking in terms of cost. So EU forward is in full speed. Simplify has been launched and operationally speaking, we expect a better performance in H2 than in H1. So this is how we are offsetting, in fact, the variation in volume in the second half.

Next question is from Christoph Laskawi, Deutsche Bank.

I'd like to come back to the Nexperia situation in Europe, please. Could you comment a bit on where your inventories currently stand? And I take your comments as you are currently going to brokers and buying as much volumes as you can, this was the same in the semi shortage a couple of years back, but it was very costly. Do you already see any cost impact from that? And is there a way to quantify it at this stage? And then on the product redesign, also, there was part of the problem a couple of years back, I believe you're probably quicker now. How long does it take on average just to redesign the product, start to sourcing? We are at least hearing that the semi capacity is available what can it be done in the time frame that it needs to be done before we see bigger production cuts?

And then last question, I know you said you don't want to comment on market speculation for any disposals. So slightly phrased differently. The time line that you have in mind for disposals. Would that time line allow for Q4 announcement of a deal or should we be more patient and wait for '26?

Christoph, and thanks for the very thoughtful questions. So let's talk next Nexperia first. So what we do is we run a really tight ship task force to calculate always where is the reach and how can we improve that. And as we know from the semiconductor crisis, this is a highly dynamic process because we will be working with our customers as well. And not only have our demand to the suppliers calculated, but we also will balance that with the demands from our customers to ourselves.

I mean, if you really want to look at time frame, this is weeks to months, and it's a bit hard to give a general answer to that one. And then again, we have seen that in the semiconductor crisis as well. When we come to runouts of components, there's always a way for the OEM to help between the suppliers as well to really get to build the maximum number of vehicles. So I expect this to happen as well if that situation around Nexperia shipments from China persists.

Then on the cost side, that's certainly by far too early to say what are going to be the implications those purchases we have been doing are not going to move the needle in the bigger picture of our annual results, and that's why we are very clear that we stick to our annual guidance.

And last not least, to the redesigned question, that's a very good one, too. It depends a bit of the product type, how long it's going to take to redesign. So I would say the more safety critical a product is, the longer it will take to redesign. Not that it is part of the FORVIA portfolio, but if some of our peers has an airbag ECU that is highly safety relevant. There, the qualification, the validation requirements are really high. And I would say you can really expect months or months for that to take place. On the other hand, if we have a MOSFET in a radio, that is by no means any safe development. We have an easier time and also an easier validation of an alternative part. And depending on the readiness and the pressure that we all see, this can be done within weeks. So I hope that gives you a little bit of a feel on what the mitigation actions can be around Nexperia.

And to your second question, how about time line for disposals? We fully remain committed to our leverage factor going below 1.5 by the end of 2026 and that's the time frame within I want to look at these disposals. We are moving at high speed through the processes. And as I said before, we are not going to put ourselves on the time pressure with concluding negotiations of such transactions.

Next question is from Thomas Besson, Kepler Cheuvreux.

Three questions, please. First, to come back on these potential disruptions. Can you talk about your -- what is usually your 6 weeks visibility your call -- do you see any impact already as the situation actually started already a few weeks ago? Or do you see things operating normally? And can you add a comment as well on the JLR ramp-up, which I think is probably the third smaller disruption.

Second, you mentioned the transfer of an exhaust business from one of your German customers to you. Could you explain what it is exactly the revenues impact and whether this was treated as an organic revenue element or not in the quarter and year-to-date? Can you give the revenue impact, please, for expected for '25? And lastly, can you help us understand the gap between your Electronics revenue growth and the Electronics revenue growth at HELLA, because yours is substantially higher, which seems to imply that Clarion has kind of really, really, really strong rate? Or am I missing something?

Yes, Thomas for the questions. Your second question did not come across quite clear in the beginning. You were asking for some revenue impact? Could you better specify -- sorry, it was interrupted here.

Sure. No, no. You mentioned in your -- sorry, I have a call so -- my voice is not easy to understand today. So you said in the presentation that you integrated one of your clients' exhaust business in the quarter. Could you indicate what the revenue impacts from that transfer, what the revenue impact year-to-date and whether this was considered to be organic or whether this is considered to be inorganic?

Yes. Okay. Good. And let me start with the disruptions and the 6 weeks visibility. That one is obviously, again, a very multifaceted answer or question. It all depends on how the global supply chain works. There is one view that we have on our own supply, but then we depend on all the others who supply electronics control units that have or used to have exterior parts into the vehicle. So far, we have not received any feedback on stoppages, but that is really to be watched day by day. And I cannot give you any better outlook now for the next 6 weeks yet. And then for the Electronics revenue growth, yes, you clearly mentioned the mix that you could conclude from the HELLA publication and then the total segment figures we presented.

And yes, we did have a very strong quarter, obviously, on the Clarion Electronics side with its infotainment devices. So Clarion in Q3 was basically growing 31% year-over-year. And the Hella Electronics side was 14%, making for that mix number that you saw.

Yes, I think a little. I think you are also asked a question on JLR and about the impact [indiscernible] On JLR, JLR is fairly small customer for us. I think it's around EUR 20 million a month. So you can be right. And in September, we had [indiscernible] That impact in our sense from the cybersecurity of on JLR. On the Exhaust, yes, we have the start of this impact of the [indiscernible] Of the in-house activity from one European OEM. This is part of our organic number. And I think on a full year basis, it's, in fact, in a 2-digit number. So it's [ 70, 18 from ] what was taken. So part of it this quarter, but this is -- this is part of our organic number.

Let me highlight that in Clean Mobility, we have also the U.S. development which is with the evolution, I would say, on the reverse of the electrification. We knew that Clean Mobility in North America will have further development in the coming quarters.

Next question is from Vanessa Jefferies.

Just one on China. We've obviously gone this year from expecting outperformance in the second half to be quite significant underperformance and understand the customer mix, but maybe you can help us out with how you're thinking about that relative performance in the fourth quarter, given overall production will be tougher. And then secondly, maybe if you can just speak generally about your order intake, given the lower activity you saw in the first half and how that's been in the third quarter.

Yes. Vanessa, happy to answer those 2 questions. So in fact, Q3, and we expect also Q4 is basically impacted by that mix change. And you see the numbers from the market. You'll see the numbers from S&P as well. So BYD, our biggest account with the Chinese OEMs has slowed down year-over-year rather than growing. And you have seen vehicle level announcement of more than EUR 5 million for the full year 2025 from BYD. The more recent announcements are pointing in the direction of EUR 4.5 million. So you can see what that means.

And the second one that has slowed down significantly as Li Auto, also strong customer of ours. So they always had a really strong stand in the market through their plug-in hybrids, the range extenders, and we now see that other OEMs catch up in that technology. At the same time, aLi Auto is just transitioning now into fully electric vehicles that are just starting to kick in. So those 2 customers were set back for us. And winners in the market where, for instance, Geely Group, where we are present but only with a minor sales share. So that is pretty much the effect you could see.

We expect that to also go into Q4. But at the same time, you know how dynamic the Chinese markets is and how pricing policy changes, for instance, between the various OEMs can also impact the mix. What we have been doing over there is clearly just our tubes, our cost situation in the impact of plants. So we want to flex very well in order to sustain bottom line and cash. And that's why we are reconfirming our guidance for the full year that works well.

On the order intake, I'm happy to report that we are on track to make the EUR 28 billion to EUR 30 billion this year. We had announced the EUR 14 billion by H1, so it's pretty much on the same slope. And through my comments, I gave you a couple of highlights when I say there's really strategic differentiation or strategic variety now in our order intake. So we want to grow in areas where with our current technology, we can still win sales. And you saw that being true for India. We extend with the Japanese and the Korean customers globally and again, are also diversifying our customer bases in China in order to protect from this kind of volatility that we are seeing right now as an impact.

Next question is from Stephen Reitman Bernstein.

A question about China, please. Could you comment on whether you are actually seeing already some impacts from the Chinese government initiative to reduce the payment terms or to shorten the payment terms, I should say, from OEMs to their suppliers to [indiscernible] For 60 days?

Steve. So far, I would say, on an average, we do business as usual. So I could not comment that payment terms significantly changed in one or the other direction.

Do you have any expectation that of the time line when the government's initiative will be enacted by the OEMs?

No, I cannot speak to that really. But what is important for us is that we live over there in a sound system where payment terms that are agreed between our customers and ourselves are also being mirrored on our supply side. So by no means [indiscernible] Between different terms. So that's our way of dealing with the situation. So we'll stay tuned and see if there is any change going to come.

Gentlemen, we have no more questions from the conference call.

Then I want to thank all the participants, and I want to thank you for those specifically very good questions this morning. You see that we keep pushing forward in our 3 priorities, performance, transformation and counter. And this will make for our results in H2 as well. and I look forward again to seeing you all on the 24th of February for our C&D and obviously, the full year results at that time as well. Thank you very much, and have a wonderful day.

Good day.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.