Rational Stock

So good afternoon, morning or evening, everyone, from wherever you are following us today. So first of all, question, can you hear me?

Okay. Perfect. Thank you very much.

So thank you for participating in today's IR Talk. So we start with the basic information. So that's the last call for Q3 now, Q3 2026, for sure. With this call, we are following the ESMA recommendations, and this means that we of course only discuss publicly available information.

And the call was made accessible to everyone who is interested via our website. Any documents that would be shared, if at all, would be made available to all nonparticipants afterwards. And an additional information, we will transcribe this call for internal purposes. So I think you need to confirm now when I start the transcription.

And please mute yourselves. So this should now work. Is it working for everybody? Can one raise your hand? Does it work? Yes? Perfect. Thank you very much.

So then let's start. Let me first summarize the most important points of H1 2026. So sales revenues amounted to around EUR 642 million, which corresponds to a growth rate of 6%. And adjusted for the negative effects, our organic growth amounted to around 8% -- adjusted for the negative FX effects, amounted to 8%.

So the negative FX effects were in Q1. And in Q2, they were already more or less neutral. And in Q3 and Q4 now, we are also expecting a neutral to slightly positive FX effect, mostly resulting from the dollar development.

It is also important to know that, looking at the development of the past month, we see that there was a stronger prebuying effect earlier this year than we initially expected. And that's why growth in Q2 was then way lower than in Q1. For assessing the underlying development, we consider H1 as a whole more meaningful than individual comparisons of the quarters.

From a regional perspective, the overseas regions of North America, South America, and Europe were still the growth drivers, the major growth drivers we were having with growth rates of around 9%. And Asia was the only region with a year-on-year decline in half year 1 compared to H1 2025, with lower sales revenues of around 4%. And here, it is still China that is driving the lower performance, while the other markets did overall quite well.

A look at the product group shows that iVario was growing at a high rate of 14% in half year 1, compared to plus 5% for the iCombi product segment. In the long term, I think you know this, we are expecting to grow around 10% to 15% with the iVario while seeing some mid-single-digit rates for the iCombi product group due to the different rates of penetration levels.

On the gross profit side, we benefited from the tariff refunds amounting to around EUR 14 million. In addition, some lower warranty levels and productivity gains in production were contributing positively. And this amounted all over to a positive effect of around 280 basis points, the major part, of course, coming from the tariff refunds.

On the other hand, higher tariff costs had negative margin impact of around 200 basis points. And so together with the smaller effects from component and steel costs and logistics in H1, this contributed to a gross margin reduction of around 200 basis points. So plus 280 points on the one hand and minus 200 on the other hand. So the gross margin stood at the end of H1 at 59.8% and adjusted for this one-off tariff refund position at 57.6%. And with that, it was 1.4 percentage points below previous year, as expected approximately.

Operating costs, on the other hand, increased slightly disproportionately to the sales revenues, also as expected. And including then the tariff refunds and less negative currency results, the EBIT margin at the end stood at 26.5%, adjusted for the refund, at 24.3%.

And with that, it was around 100 basis points lower than in half year 1 2025. And this, again, as expected. So for more detailed information on H1, please visit then our website.

So closing H1, let me now go over to some -- so sorry, there is somebody not muted. Okay. Perfect. Thank you.

As a reaction on seemingly sustainable higher cost levels, mostly for steel, electronics, chemicals, energy and logistics, management decided to implement a price increase for our cooking systems of 2.9% on average. So this is not for the non-unit business, so not for cleaners, accessories or spare parts, but just for cooking systems. And it will not be in the U.S. as we already increased prices in February in the U.S.A.

So that means slightly more than half of our sales revenues will be affected by this price increase. We announced this towards our dealers in early September, and it will be effective from October on in the most countries with the exception of the United States as said.

For fiscal year 2026, we expect a sales revenue growth rate in the mid to high single-digit percentage area. And again, as said, we saw significant negative currency effects in Q1. And now this is gone and it should not contribute negatively, but maybe from Q3 and Q4 on, rather positively. Always, of course, assuming constant FX levels from now on. On the other hand, we see continued trends on the sales development so that we confirm our sales guidance.

From a regional point of view, same story. So we see that the trends approximately are intact as we saw it in H1, with a few exceptions that I will describe now. So one topic that is important to mention is that due to reduced government funding compared to high levels of last year's government funding, the school business in the U.S. also was coming down this summer compared to the elevated levels of last year.

Another important topic is some volatility we always see in our OEM partner business here now in Japan, which shows lower levels in Q3 after contributing very well to growth in Q1 and Q2. So this volatility is absolutely usual for those kinds of customers, and the rest of the business is not affected.

Due to the announced price increases, we saw elevated order numbers again now in September. So the effects on Q3 sales revenues were indeed of minor importance, presumably, as the orders were not shipped yet in the majority of the cases, which means that we will again have an elevated order book level at the end of September now. But at this stage, we cannot determine whether the preordering effect represents only a pure order shift from Q4 to Q3 or whether it will also have a positive impact now on Q4 sales levels in total.

So another information on the tariff situation, as already said, the EUR 14 million refund in Q2 was a one-off. This impacted gross margin and EBIT margin of course positively in Q2 and in H1. And on the other hand, the tariff rates for cooking systems were lowered from 25% to 15% from June on. And this will lead to lower tariff costs in total for 2026 compared to what we initially expected.

So we are estimating the total tariff expenses in total to be, as already said maybe in the last calls, in the higher EUR 20 million areas, so around EUR 14 million to EUR 15 million higher than in 2025 where they stood at around EUR 12 million to EUR 13 million. So this reduction of the tariff rates will get effective mainly in Q4 2026 now, after, let's say, rolling the bigger part of our warehouse that was still booked with higher tariff rates.

So sequentially, quarter-on-quarter, this will lead to lower tariff expenses in Q4. But the exact amount is, yes, open and difficult to predict right now. So this depends in the end on the order situation and when the -- which part of the order book will be taken out.

And on the other hand, as already mentioned, we see increasing costs for different kinds of inputs like stainless steel, electronics, chemicals, logistics, et cetera. So this will be significantly higher. And if we sum this up, for fiscal year 2026, all over, this will lead to effects in both directions, some lowering costs, some increasing costs. They should eliminate each other more or less, maybe with a tendency toward more reduction than increase.

So therefore, our guidance is all over still valid. This means mid to high single-digit growth rates for sales revenues; gross margins slightly below previous year, maybe 50 to 100 basis points. And together with the cost development in the operating sector, that we come out with an EBIT margin level that is maybe rather towards or around the upper end of our guided range of 25% to 26%. So here, we are maybe a little bit more optimistic, but I think we already mentioned this also in the earnings call of the half year.

And after this short recap, I'm ready to answer your questions. So I think Ope already raised his hand. And feel free to raise your hand and then I call you afterwards. So let's start with Ope.

Stefan, just 2 questions for me. Just first one on China. I suppose that's starting to see the effect of the KFC reductions there. So did you have a sense of sort of what impact that might have on sales in Q3, Q4?

And then the second one is, I suppose you went into H2 with a bigger backlog than normal just given the prebuy effect in Q1, but then you have this pricing effect that [ muddle things ] in Q3 and Q4. So just any comment on like progress on the initial order book before the new price heading into H2 and what that might mean? Also the institutional weakness maybe in the U.S.

Yes. So first on China, all over the situation has not changed that much. So we will see presumably similar developments when you look at the figures. So from that point of view, no major change. So KFC is on a low level, staying on a low level, and they started early this year in January, February. So I think a normalization so that the base effect here will be gone. It just will be expected maybe beginning in Q1 next year. So until then, we will see reduced sales levels there, approximately in the magnitude we saw in Q1 and Q2.

And on the pricing and prebuying effect, yes, as always, we see, if there is an announced price increase, we see some preordering, let's call it here, preordering effect, so that people place their orders in order to safeguard lower price levels. And this year, I think we have maybe even higher, maybe around EUR 20 million to EUR 30 million higher order book level presumably now. But as we are just at the quarter-end, this just could mean that everybody who wanted to buy in October, as there is also an agreement with the dealers, that they need to ship preordered units quite early on.

This means this is maybe just a transfer of the orders from the 1 quarter to the other, and they will be shipped then in the next quarter. So presumably, we don't see a lot of these effects now in Q3, maybe just minor parts, but not a lot. And in Q4, we will have shipments that maybe normally we would have seen the orders maybe in October for that, and now they came in, in September, to safeguard the lower price level.

And the pricing effect of higher price levels now for units in Q3, there will be maybe a smaller part of positive effect. Whether this is then EUR 2 million, EUR 5 million or whatever number, it's difficult to predict. As said, it depends a little bit on also the order behavior then.

Is there more hands up there? So first, Craig, then Lars, and after that, Fraser.

Yes, Stefan. First question, I appreciate, of course, you don't -- won't be guiding on '27, obviously, until early next year. But I just wondered in terms of the structural factors, particularly the things you can control, the rollout of your sales and marketing force, capacities both in the iCombi vertical and on the iVario side. And also keep in mind, some of the base effects you'll be running into, some positive -- sorry, some negative in Q1. I just wondered if you have any -- provide any color as to type of growth rate -- top line growth rate, excuse me, momentum you're kind of looking at as you're heading into '27.

I kind of think you have a view of the idea here has been to ramp up your capacity so that you can start to trend back toward the long-term trend line growth of the company more in the 8%, 9%, 10% range. I just wondered if you -- if there's any early stage color you could provide here.

Do you mean sales capacities?

Well, I just mean like factors that -- including that, that could be driving your top line growth heading into '27.

Yes. So basically, you know that our expected midterm growth pattern is what we say in the mid to high single digit. This is maybe somewhere between the 6% and 9-point-something percent. So in the past, when we look in longer-term time frames, we had approximately 8% on average. I think this is something we could expect for the average for future, that we'd see it as sensible. But what it will be in '27, it's difficult to say.

I would say, as an indicator, as you already mentioned, so we are building up sales capacities. We saw this in the level of the, I think, 7%, 8% or so after half year 1. And I think this is going on approximately in this magnitude. And we will see this as a, let's say, top focus of the management for the coming -- yes, for the near future. And so we will really highlight this. Otherwise, difficult to say.

There is always local influences which help or do not help. For example, as we already mentioned, I think in the German-speaking area in Switzerland, in Austria, we had a bigger deal with a supermarket chain, which was absolutely supporting here. On the other hand, the negative impacts from the Chinese business or also now in the short term with the volatility of the Japanese OEM partner, this is always, of course, then negative impact. Yes, and they are normally compensating for each other more or less.

So Lars?

Stefan, yes, I'm trying to figure out the cyclicality of your business this year again. Now you said at the end of Q2, you had a stronger order book or a higher order book; you're entering Q3 with strength. Now you say Q3 ends with a higher order book, we should be aware of the U.S. school business, Japan. So quarter-on-quarter comparing Q2 to Q3, is it possible that we see a mid-single-digit quarter-on-quarter revenue improvement? Or would that already be too optimistic given what you are seeing so far?

You mean quarter-on-quarter...

Yes, from '26, yes. From EUR 324 million in Q2. Should we expect Q3 to be comparable given all of the influencing factors? Or could we see growth there?

Yes. I would say normally, Q3 is comparable to Q2, maybe a little bit higher. A little bit higher. That's the normal pattern. So lower volume in Q1, then a little bit higher in Q2 and Q3, and then the highest level in Q4.

I think what we need to consider this year is that we last year had a very strong Q4. So this is maybe just for the remainder of the year very important. And now for Q3, as said, normally, we would expect slightly higher levels than in Q2 when you look into a normal seasonality. And I think there is maybe some positive, some negative indicators contributing. So from that point of view, I would not see a 5% difference. This would be very high between these 2 quarters, yes.

So Fraser?

Stefan, just -- could you just come back on the U.S. schools point which you've been calling out, just to maybe help us understand how meaningful that is, also just thinking specifically about the U.S. business given that seems to be an area where you had a strong backlog, there have been these strong orders in June? So just to understand the message, if it's cautious or not, on the market as a whole.

I mean on the U.S., maybe there is one important fact that's very important. It's just that the FX effect, the negative FX effect we saw, especially in Q1, that is gone and rather is going to neutral or maybe even slightly positive. So depending on the development for sure.

And school business for us is very strong. It was even elevated in the past, maybe, I don't know, 1 or 2 years, because of higher funding levels we were seeing. And this, of course, was helping us then in Q2 -- sorry, in Q3, to, yes, also grow there quite nicely. And this year, the levels are lower.

So as -- when I talk to my U.S. finance colleague, says rather this year is maybe the normal level and last year was elevated. And the school business in good years was up to 20% or so of sales in total. And this year, it will be a little bit less and we would see it rather in Q3. So this is maybe sort of giving you, let's say, a trigger for your models on U.S. sales in Q3, but it's, of -- it's not completely depressed, but it will be a lower level.

And whether this will be then stable next year because the funding will stay on this level or it will -- there will be extra funding again, that's difficult to predict. But for this year, it's just a negative one.

So I think Ope was again raising his hand.

Just one on the U.S. So comps are quite hard in Q4, I think on organic basis, above 20%. Do you know how much of that was prebuy versus underlying demand and sort of how to think of -- in Q4 last year in the U.S.?

No, sorry, this I cannot say. Sorry. I would not assume that there was a lot prebuying in Q4 last year. Sometimes you know our business model, that's very year-end driven as our salespeople try to, let's say, optimize their bonus, our dealers try to optimize their kickback payments and, of course, big customers with open budgets want to use it at the year-end in order to maybe not lose it for the next year. And so sometimes this could be a little bit more, sometimes less. But how much prebuying was in there, we cannot say now.

Perfect. So as -- now [ Christian ], is this -- yes, you're raising your hand. Yes.

Yes. I just wanted to ask again, you mentioned the tariffs. I got lost a bit because it was often moving into various directions, so many, yes, changes in the directions in the past. If I understood you correctly, you said that you expect a lower tariff impact in Q4. But you stick to the EUR 14 million to EUR 15 million increase year-over-year. Can you maybe repeat the context again? Because I got a bit lost within all these information.

Yes. So with the tariff situation we were facing at the end of last year or early this year, we were assuming tariff costs of, I think, around EUR 33 million or so. So way more than, of course, last year, but also now, of course, a higher level than we are seeing right now after this tariff reduction was announced.

And we think that there will be, let's say, sort of a lower level, in the magnitude of EUR 4 million to EUR 5 million compared to the initial -- let it be from EUR 3 million to EUR 5 million lower levels, compared to what we initially thought, due to this lower amounts or lower tariff rates now, which we would mainly see in Q4 now. We maybe saw it to some extent in Q3 already kicking in with the first warehouse positions going out that was already booked to the lower rates. But now I think in Q4, we will see the major part so that those units sold mostly would maybe be booked -- already be booked with 15% tariffs, which is now contributing to lower COGS.

And so from that point of view, I would say, in a rate between EUR 2 million, EUR 3 million, EUR 5 million incremental lower costs, so quarter-on-quarter, expected to be in Q4 maybe. But on the other hand, when we look at the guidance, higher cost levels might compensate for this. Always difficult to predict the exact amounts, but this should help maybe to partly compensate for the higher costs so that the gross margin maybe would, yes, benefit a little bit and be less negatively affected than we initially thought.

Okay. [ Hilla ].

Yes, Stefan. I missed the first part of the call, so maybe you have already answered my question. But for -- in Europe, did the strong momentum seen in Germany and Europe continue through Q3, that you have seen in Q2? And are you seeing any signs of softer customer investment decisions in Europe heading into Q4?

So in Europe, so we didn't have it in that detail, to be honest, but we said, okay, there will be more or less unchanged trends for the European markets as we saw it in H1. So still a very robust development, with the additional positive impact from the supermarket business in Austria and Switzerland. Germany still on a high level. And also in the European markets, we see some stronger markets, we see some less strong market. But all over the robust development is going on. So we do not see any signs of really weakening business development in Europe.

Okay. So as there appears to be no further questions now, I want to conclude today's call. I thank everybody of you for your participation. If you want to look up our IR dates, please go on the IR calendar on our website, and also the IR Talks, I think they are already in there. So if you want to block these appointments in your schedule, this could be helpful. And of course, if you want, share your feedback with us to help us improve.

And with that, then we are looking forward to seeing you in our H1 (sic) [ 9M 2026 ] call on the 5 of November. So see you soon. Take care and bye-bye.

Good afternoon, and welcome to RATIONAL's Earnings Call for the Second Quarter of the Fiscal Year 2026. The results will be presented by the CEO, Dr. Peter Stadelmann; and the CFO, Jorg Walter. [Operator Instructions] Also be aware that this event will be recorded, and you will be able to review it later on Research Hub.

We're looking forward to an insightful exchange, and I will now hand it over to Dr. Stadelmann.

Good afternoon, and thank you for joining us. First half of 2026 developed in line with our expectations. Despite continued geopolitical and economic uncertainties, we delivered solid growth, maintained strong profitability and confirm our full year outlook.

A proof for our strong market position and innovation leadership is the iHexagon, the world's first and only cooking solution using 3 energy sources simultaneously and smart. Loft 56 is a highly frequented restaurant in Ireland. The chef explains why he is about to buy even a second iHexagon, and please note what the customer is using its former oven for these days. Enjoy the movie.

[Presentation]

Yes. So you had some real feedback from an existing customer, and I think can understand now also the potential that is in the iHexagon technology. Another important event was the National Restaurant Association Show 2026 in Q2, which takes place in Chicago. We run 52 arena shows where our cooking solutions could be watched in action, and we created more leads in the show than in 2025. The high level of customer engagement and interest in our cooking systems confirms the significant growth potential we continue to see in this strategically very important market.

Another event were the Cooking (sic) [ Cook ] for Change challenges or initiative from Sodexo. RATIONAL is Sodexo's global preferred supplier for cooking solutions. Sodexo is the world's biggest catering company, employing more than 426,000 staff and serving 80 million dishes per day. We support them in their Cooking (sic) [ Cook ] for Change initiative to promote sustainable cuisine.

500 of Sodexo's chefs participated globally in this challenge. It created over 20 million views on social media and also gave us a lot of attention. Our partnership with Sodexo highlights how RATIONAL technology supports efficient resource utilization, waste reduction and sustainable food production at global scale.

We not only support challenges, we also participate ourselves. We are proud to have received another Best Managed Companies Award. This recognition reflects our long-term management approach to keep strong customer focus and entrepreneurial U.i.U. culture. In addition, we just recently got named 1 of 12 leading quality stocks by the German Handelsblatt. Criteria were revenue and earnings growth, high profitability, strong balance sheet and a resilient business model. We see ourselves in great company here with the shares from Microsoft, SAP, Visa, BNP Paribas and for instance, Samsung.

And our people remain a key competitive advantage. The entrepreneurial culture embodied in our Unternehmer im Unternehmen philosophy continues to drive customer focus, innovation and execution across the organization. To foster that culture and to thank our employees and their families, we held our traditional summer party 2 weeks ago in Landsberg. More than 2,600 participants had a lot of fun and food.

Let us now turn to the financial performance. Overall, we are pleased with the first half results. We achieved profitable growth, strengthened our market position and continued to invest in future growth opportunities. After 6 months, our revenues grew organically by 8% and 6% after FX adjustments. We achieved EUR 642 million. Growth was higher than in 2025 and 2024. This is in line with the expansion of our sales force by also 8% and the increase of our sales activities at the very same growth rate.

Looking at the quarterly results, we see revenue increased by 4% to EUR 324 million in the second quarter. In retrospect, the first quarter benefited from some pull-forward effects in the United States related to pricing actions. We assess the magnitude of those pull-forward effects were EUR 6 million to EUR 8 million. The 8% and 4% growth rates in the corresponding quarters add up to the consistent 6% for the half year 2026. Underlying demand remained solid and in line with our expectations.

For more details, I hand over to Jorg.

Thank you, Peter, and also hello to everybody in this call from my side. Let me now turn to our sales development. Sales revenue by region for first half 2026. Overall, revenue growth continues to be driven primarily by Europe while developments in the other regions were more mixed. Let us start with Germany. Revenue increased by 9%, reflecting a demand in our home market. We are particularly pleased to see that the growth remains strong in the second quarter as we had a positive onetime effect from a major stockholding dealer in the first quarter.

Looking at Europe, excluding Germany, revenue also increased by 9% to EUR 285 million. Growth was broadly based across the region with particularly strong developments in Austria, in Spain, in Scandinavia, Switzerland and in Eastern Europe. We also saw a return to growth in Benelux while only a few markets, such as Turkey, remained below the prior year level. Overall, Europe continues to demonstrate resilience and remains a highly reliable growth contributor for our group.

Turning to North America, revenue increased by only 4% to EUR 154 million in the first half. However, before exchange rate effects, we were able to grow in the first half by 10%. Growth of the region was entirely driven by the third quarter. We already mentioned that, where we saw organic growth of over 23% and 1 factor was this prebuying from the February price increase and that pushed sales level of second quarter down.

Now turning to Asia, revenues declined by 2%. The main reason was the continued weakness in China where revenues were down year-over-year by 25%. Here, we are heavily affected by Yum China's decision to source combis -- combi ovens locally. This was partly offset by solid growth in Japan, India and in several partner markets. While the short-term environment in China remains challenging, we continue to see attractive long-term opportunities across the region and especially in China with our new product, iCombi Pro.

The smaller regions, Lat Am and Rest of the World, I don't want to comment in detail as we usually see higher variances on a quarterly basis here. Maybe only a word to the near Middle East. Dubai, the conflict with Iran is affecting our sales in this region, which is part of Rest of the World, and this is 1 main reason why we are showing a decline in sales in this area. To summarize the regional picture, Germany and Europe remain the key growth drivers. Together with North America, we also had a double-digit growth rate by 10% in the quarter.

Let's take a look at the development of our product groups. Starting with iCombi, revenue increased by 5% to EUR 562 million. As our largest product group, the iCombi continued to benefit from solid demand across most regions that are the effects we just talked about, and the iCombi remains the backbone of our business.

Looking at the iVario, revenue increased by 14% to EUR 79 million. And as we have stated before, we generally expect the iVario to grow faster than the iCombi due to its lower market penetration and growth potential in many markets. The half year numbers once again underline this expectation and especially positive to note here was the higher sales level in North America with a growth rate of 24%.

Let me now turn to the development of our EBIT. In the first half 2026, EBIT increased by 11% year-on-year to EUR 170 million, with an EBIT margin that reached the highest number since many years with 26.5%. This was possible due to the positive impact from tariff refunds related to our U.S. business, which were recognized in the second quarter. Excluding tariff refunds, that was an amount of EUR 14 million, the profitability would have been 24.3%. This number is fully in line with our guidance for this year.

Let me walk you through our profitability development a little bit in more detail. We already discussed the revenue performance, so we focus now on profitability. Looking at the gross profit level, cost of goods sold increased by 4% below the growth rate of the revenue. Gross margin remained affected by higher material costs, increased logistic expenses and the tariff-related effects. These headwinds were more than offset by the tariff refund that we received during the second quarter. As a consequence, gross profit increased by 7% with an improved margin of 59.8%.

Operating expense increased by 5% year-on-year to EUR 215 million. And as announced, we continue to invest selectively in our strategic priorities. First of all, that is R&D. Expenses here grew by 7%, reflecting our ongoing commitment to innovation and future product development. Sales and service costs increased by 5%, mainly driven by customer-facing activities and targeted initiatives to further improve our market position. At the same time, administrative expenses were slightly below the prior year level, demonstrating our continued cost discipline and cost initiatives. And as we heard before, as a result, EBIT increased by 11% to a very good number for a first half year of EUR 170 million, outpacing our revenue.

I don't want to comment too much on the balance sheet as it is clear that it remains very strong. Total asset increased by around 7% year-on-year, reflecting the continued growth of our business. And despite the high dividend payout in May of 90% of our earnings of 2025, we increased the equity by nearly EUR 40 million against the June last year number. Most of that equity increase is now in our liquid funds. In addition, we have higher inventories in our overseas markets to secure our delivery abilities, and also since we opened a new warehouse in Dubai.

Let me conclude with our revenue and earnings outlook for this year. The economic outlook for the commercial kitchen industry remains positive despite the ongoing geopolitical uncertainties. The out-of-home food service market continues to grow, and driven by the persistent shortage of skilled labor, automated and efficient solutions such as combi-steamers and iVarios remain in a high demand. Therefore, we expect 2026 to continue to grow in the mid- to high single-digit percentage range.

After having stabilized in recent years, raw material and logistic costs have started to trend upwards again. In addition, we face a full year impact from the foreign exchange rate and the tariff situation for our exports to the United States. The reimbursement of the tariffs paid mainly in 2025 helped to buffer these effects. Overall, we still expect the gross margin to come in slightly below the prior year level. And also in this year, we will increase certain operating expenses, especially in the direct sales area. Costs not related to sales will be kept as stable as possible. Overall, that means that we keep our EBIT guidance. However, due to the reimbursement of tariff, we expect the EBIT margin rather around the upper end corridor of between 25% to 26%.

Now this concludes our presentation, and we are now happy to take your questions.

Thank you so much for the insights that you've already shared. We did get a lot of questions before the event started. So I will dive right in. First question regarding salespeople. You further developed your sales footprint. Can you talk about the further need for a ramp-up in salespeople?

Yes. This is an ongoing process that needs to be performed consistently in order to fuel sales growth. As we showed in the Q1 call on a slide, there is a clear causality between increasing sales force and our sales activities and development. So further market penetration means compacting the sales territories by adding salespeople.

Let's continue with the next question. It's regarding China. China remains very weak. How has the acceptance of the iCombi One product been so far, and do you expect sales in China to return to growth in the coming quarters?

Yes. As you know, we do not publish any details on the iCombi One. But so far we are happy with the development. I have to check for the right question. Sorry, give me a minute. I don't see it.

Sorry. Let's continue with the next question. The update on iHexagon. Can you give us an update on iHexagon? Yes. That would be appreciated.

Yes. No problem. Also here as you know we do not publish any detailed numbers. We are happy with the development so far, and as shown in the movie at the introduction, we find more and more customers which really see great benefit from using the iHexagon.

Great. Which region does propel the iVario sales in the first half of 2026? And can you give us an outlook for the second half 2026?

Yes. Biggest growth came from U.S., France, and Iberica, so Spain and Portugal. We are confident to keep the growth rates double as high as the iCombi growth rates for the future.

Great. Could you provide an update on the market development in China, the acceptance of the iCombi One product there and customer feedback, and also whether the product has already secured any major chain or key account contracts in that region?

Yes. Consumer sentiment in China remains subdued and continues to weigh on our business performance. The main headwind is the decline in sales to Yum China, as KFC China is increasingly shifting towards local sourcing strategy. At the same time, our street business is developing positively. The iCombi One sales team has been set up. We are gaining new dealers for all products every month. Customer interest in the iCombi One is high, and as previously announced, we have already secured a contract with a new key account for the iCombi One.

Thank you. Does management see any competitors boosting productions in the U.S. as a result of tariffs? Would RATIONAL consider investing in the U.S. directly?

No, we do not see this, and we regularly assess the overall situation for USA production.

Great. Thank you. Could you provide more detail on the increase in the order backlog at the end of the second quarter, and comment on the drivers behind the stronger demand trend towards the end of the quarter, and were there any changes in customer behavior? Can you discuss July trading as well?

First of all, monthly fluctuations are quite usual, but development during Q1 and Q2 was mainly driven by the prebuying effects in the United States. The stronger demand development was driven primarily by the U.S., Germany and Canada, while most other markets also contributed positively. The strong order intake in June led to a higher order backlog at quarter end, as not all orders could be shipped before the end of the quarter. As a result, the order book was approximately EUR 10 million to EUR 15 million higher than at previous quarter ends. Overall, we expect the higher order backlog at the end of H1 to support positive business development in H2. [indiscernible]

Continuing with Asia, why did Asia South slightly miss the results a year ago?

Major impact was from Australia. The development is mainly driven by timing effects related to a large partner who restocks the warehouse as needed. Over a longer period however business development remains stable with no structural changes.

Great. Thank you. Can you give us some reasons for the strong growth that we've seen in the DACH countries?

Yes. Growth in Germany was driven by one-off stock orders from several dealers in Q1, while Q2 showed broad-based growth across the business without any significant onetime effects. In Austria, growth was supported by rewinning a major Aldi [ offer ] tender at the start of the related rollout. In Switzerland, there were no specific one-off factors, with performance reflecting generally solid business development and strong market execution.

Great. Thank you. Let's continue with regions. Dr. Stadelmann, the impact from the Middle East conflict, what are you seeing?

Yes. The Middle East conflict has a limited impact on our business. Revenues in the region accounted for approximately 2% to 3% of group sales in the prior year. In H1, we recorded a sales decline of around EUR 2 million. The conflict has generally led to higher costs. However, we do not expect any material shortages or supply chain disruptions for us.

Great. Thank you. Let's look at the U.S., Dr. Stadelmann. Which factors in North America enabled the currency-adjusted sales growth of a little bit over 10% in the first half 2026?

Yes. North America, especially the U.S., is our #1 growth market due to the big open potential. So 10% plus organic growth is a growth rate we would expect.

Great. And would you mind splitting your Q2 2026 sales growth, which was roughly 4%, into volume growth on the one hand, and business mix, price growth on the other hand?

Yes. The majority of the 6% year-on-year sales growth in H1 was driven by underlying volume growth. A smaller portion came from the regional mix, while price increases had only a minor impact on the overall growth. Specifically in Q2, volume growth remained the main driver, while price increases started to make a modest impact to the growth.

Great. Thank you. What cost does the group expect coming from tariffs in the second half of 2026?

For the full year effect, we expect tariffs to be around EUR 28 million to EUR 29 million. And with the reduced tariffs rates now, we expect that the second half will be a little bit less than the first half.

Thank you. Also continuing with tariffs, the expected development of input costs. Costs of goods sold increased by around 9% in the first half 2026, excluding the refunding of the U.S. tariffs. Will this rate continue in the second half of 2026 as well?

Yes. It will, as we are facing an increased level of input costs. That is for steel, that is for chemicals, but also especially in the electronical sector, which will presumably not reduce in short term. We are expecting higher growth rate for the COGS also in the second half.

Great. Assuming the actual level of energy costs, which additional amount will you need to pay compared to 2025? What are you expecting?

Direct energy costs, they are very low. Only EUR 3 million for gas and electrical energy. Plus, we have around EUR 2.5 million for the fuel for our company cars. So the total effect year-on-year is maybe, I don't know, EUR 0.5 million. So it's not significant. The higher impact comes from our customers and our suppliers that are facing higher impact here.

Great. Looking at another cost item, wage costs, how do you expect those to develop going forward?

We have our regular salary round every year beginning in July. And we increase our salaries for around 3.8% on average in Germany from July on. In general, we are getting orientation from inflation rates and in Germany from the metal union negotiations. That is the current state.

Thank you. You've talked about other costs rising as well, and one of the questions is if we start looking into 2027 already, the U.S. tariff refund will probably not be repeated, and bearing in mind that currently higher costs for a lot of inputs, might that trigger potential slight price increases to offset those higher costs in the coming year?

Yes, there are different scenarios in discussion. As you know, typically, we would like to avoid price increases and rather buffer this by efficiency increases. But if the amount gets higher than you can do by efficiency, we typically also think about modest price increase. And we are looking at these scenarios right now.

Great. Looking at tariffs, I think you shared a calculation previously that with a 10% tariff base assumption, a list price increase of between 6% to 7% would be needed mathematically in order to maintain the absolute earnings contribution. Is that calculation still valid?

Yes. The calculation, the mathematical exercise is still correct. The absolute number, the 10%, is certainly not correct anymore. Next year, we are rather looking at around something like 14% on average on tariffs. But the mathematic, the ratio between the 10% and the 6% to 7%, that is still the same.

Thank you. What margin improvements would you expect from your service parts investment in Landsberg? How is your revenue mix split between cooking systems on the one hand, service parts, care products, and accessories on the other? And what CapEx projects should investors be expecting for 2027?

Well, first of all, the primary reason for the decision to expand the service parts building in Landsberg was not to lower the costs. It's about growth. It's a decision that we need to invest in order to ensure the service parts availability, and that is the main driver. So there is not really a scalability. Rather, we are having set up and step up costs. So once the building is fully in operation, we are expecting higher depreciations in the area around EUR 1.5 million to EUR 2 million. So it will be, first of all, rather putting some more pressure on our balance sheet, on our P&L, but we expect then with the further growth to buffer that up.

So that is the majority. In terms of CapEx, new service parts building center in Landsberg, that is expected to be completed in the beginning of next year. So we will start that in Q1 2027. In addition, we will start with the construction of the new customer experience center in Landsberg, located next to the existing training centers, and that is scheduled to also begin in the next year, the middle of 2027.

Great. Looking at guidance for this year, could you provide an update on the outlook for the second half and the remainder of the year, including input cost developments, demand trends, and expectations for key markets such as, for example, Germany and North America?

Yes. The input cost, they remained mixed. While the stainless steel base prices, they are still low, the alloy surcharges have increased more than expected and are likely to have an impact in the second half. The freight costs also remain elevated, but have recently stabilized. Overall, the demand continues to be supported by the healthy order backlog. In Germany, we expect the positive momentum to continue, although it remains uncertain whether the exceptionally strong growth rates can be sustained also in the second half. In North America, we continue to expect growth in the range of 10% to 15%, in line with our long-term outlook. In the U.S., some of the last year's headwinds, such as FX effects, are expected to ease in the second half. Overall, we remain positive on the outlook for both markets.

Thank you. Looking at your balance sheet, we've seen quite a strong increase in inventories, which were up by nearly 10%. Can you give us some insight as to what the key driver behind this was?

Yes, I said that in the presentation. First of all, we opened a new warehouse in Dubai, so that put on some extra stock level to the balance sheet. And then we have seasonally increased our stock level in overseas markets just to ensure the normal delivery availability.

Thank you. Looking at accounts payable, do you expect accounts payable to be on an overall higher level in the future? And if yes, why?

Well, the accounts payable is not a big number in our balance sheet. It's more or less on a constant level. But you'll see in the balance sheet, timing shifts between the quarters. So from our side, we don't have any specific topics initiated there, so it's just a random effect.

Great. Thank you. Let's look at a big number in the balance sheet. You've done a special dividend this year, but your equity ratio at roughly 80% is still pretty high and solid, and some of your peers do regular share buybacks. Are you open to examining share buybacks as part of your capital returns framework, also given the share price level?

Well, we never really looked into this topic. The share buybacks, it's not really important to us because we have a low free float of the shares, and we don't want to limit that further. So our unwritten dividend policy is to 70% payout ratio, plus a special dividend if that is possible. I think we will keep on with this policy, and have a good chance, if liquidity is on a high level, to think about a special dividend in the future also.

Great. Should we expect a tariff impact next year of around EUR 28 million to EUR 29 million on EBIT as well? Or do you already have an idea of where that could probably come out at?

That is actually around what we also plan for the next year. Certainly, we have a growth in the U.S. market. So probably it's EUR 2 million to EUR 3 million higher than for this year as our business volume is growing in the U.S. But in general, this calculation is correct.

Great. I do not see any other questions as of right now. [Operator Instructions] I see that somebody is still typing, so we'll give that person a chance to post a question in the chat, and chat in the meantime. Give us 1 minute. We'll see what the question will be. Great. It's regarding China, our Chinese competition. Chinese competition and market shares. Could you please comment on the competitive intensity in China? Are local competitors mostly competing on price? And would iCombi One help you gain back market share?

Yes. So as usual, in I think a lot of industries, we see more local manufacturing. For us, that's mainly 2 companies. one is called Justa and the other is called [ NoPain ]. They produce, I would say, medium quality combi ovens at, of course, lower production costs and therefore also lower sales prices. Also lower services after sales. So usually they do not offer any training or not the same state-of-the-art quality in service repairs, maintenance as we do. The iCombi One aims at being competitive again with those products like the [ NoPain ] or Justa oven. Price-wise, we are slightly above them in list prices. But we also know that our cooking quality is above what they deliver. So it must help us, again, to also have an entry model combi-steamer and win some market shares there. The iCombi Pro, as you might know, is still, of course, in sales. But in most cases, we will not offer the iCombi Classic in China because especially its display function is not at that level where Chinese customers expect it to be these days.

Great. Last question is regarding North America and the performance. You mentioned the Chicago NRA Fair. And given the development of your order book, what level of growth do you expect for this year to see in North America?

As we said, in the first half, we had before FX effects this 10%. This is around the level that we would also expect in the second half, maybe a little bit higher.

Great. I think that concludes it. Thank you very much for the insights that you've shared and the good answers to the questions. Of course, thanks to everybody who submitted questions and also asked them during the chat. I will say 2 more things. This event has been recorded and will be made available later in the course of the day. And we will also send out a questionnaire shortly. If you have a second, we'd appreciate your feedback. And with that in mind, I will hand it over to Dr. Stadelmann for the last final remarks.

Yes, thank you very much. My dear ladies and gentlemen, to close the call, please let me thank you for you actively participating. We are looking forward to staying in contact with you. So in case of any questions, please do not hesitate to contact our IR team. Laura and Stefan will always be there for you to support you and answer your questions.

Our next IR event will be our IR follow-up talk next week, Tuesday, 11th of August at 2:00 p.m. CET. You can find the subscription link on this very slide or on our homepage. The next announcement and earnings call will be on November 5th in the same setup. Please let me also announce some information on our 2026 Capital Markets Day. We are planning the CMD for November 19th. After having made it in Landsberg, in Wittenheim, and at Munich Airport with a lot of snow, for those remembering, in the last years, we will make it online in a webinar focusing on the virtual world of ConnectedCooking in 2026. More details will be sent out with a save the date in the coming weeks. And with that, I wish you a nice summer, a good time, and on behalf of Laura, Stefan, Jorg, and myself, we are looking forward to meeting you soon. Thank you and goodbye.

Thank you and goodbye.

So I would suggest we start. So again, thank you for participating in this IR talk. And again, good afternoon, morning or evening from wherever you are listening today.

So this is now our last call for Q2 or half year 1 2026. And as always, some notes at the very beginning. So this -- with this, we are following the recommendations of the ESMA. This means we are just sharing, of course, publicly known information. The call was made accessible to everyone who is interested via our website. And if we would maybe show any documents later on, which I would expect not to happen, then this will be, of course, made available to all nonparticipants as well. And another hint, this call will not be recorded by us, but I think there will be some transcripts produced by service companies.

To start with, let me first summarize the most important points of Q1 2026. So sales revenues in Q1 amounted to around EUR 318 million, which corresponds to a reported growth rate of 8%. Adjusted for negative FX effects, the growth amounted to more than 11%. Here, it is important to know that looking at the development of the past month, we see that there is a stronger prebuying effect than we initially expected. To be honest, we cannot, of course, quantify that in detail. But looking at the strong organic growth in Q1, we would estimate that 2 or 3 -- between 2 and 3 percentage points of the growth in Q1 were coming from prebuying effects, mainly due to the announced price increases in the U.S. So this would mean a bandwidth of between EUR 6 million and EUR 8 million, which might be put forward from Q2 or later into Q1 for saving old price levels.

From a regional perspective, the overseas regions of North and South America and Europe were the major growth drivers. Asia was again a negative outlier in Q1 for us with 3% lower sales revenues compared to Q1 2025. And here, of course, you know that still China is one of the most important driver of the lower performance, while the other markets overall did quite well.

A look at the product group shows that the iVario was growing extraordinarily strong in Q1 with 18% compared to plus 6% for the iCombi. But in the long term -- so this is not a run rate. In the long term, we are expecting for the iVario growth rates between 10% and 15% and some middle-digit growth rates for the iCombi product.

Looking on the gross profit side, we benefited from some lower warranty levels and productivity gains in production. This amounted to a positive effect of around 80 basis points. But on the other hand, of course, the most important part were the tariffs, which had a negative margin impact of around 240 basis points. So with some smaller effects in Q1 coming from components, steel and logistic costs, this led to a gross margin reduction of around 150 basis points compared to Q1 last year.

Operating costs, on the other hand, increased slightly disproportionately to sales revenues, approximately in the range that we expected. And supported by a little bit less negative currency result effects, the EBIT margin was then at 23.9% in Q1 2026. And with that, around 50 basis points lower than in Q1 2025.

Before we start to look at the remainder of 2026, it is important to say again that not only the figures give us a good feeling and a confident look into the future, but also the foundation of this success. So this means that the development of the sales organization is going on, started since we had left the crisis years behind us by the end of 2023 or so. And this means that we are continuing to hire more salespeople. We see a growing activity figures. And with that, we trigger more demand and increase then the sales revenues.

And as said in many occasions before, there is one exception, and that is China. But with all other markets, we see we are on a good way. But of course, in total, it's an ongoing process, and we need to continue developing the sales organization. So of course, we are not yet there where we want to be. And this will, of course, then go up in the next years or from year-to-year.

In China, after a management change last year, we are now about to reestablish, let's say, the RATIONAL way of selling, of marketing. And for the team, this is quite a challenge right now together with this process also of establishing the new product series in the market, including also the sales activities, which are now not only for one product, but for two different products from -- where one is really new.

In China, in addition, we see still a very low consumer sentiment. And in the latest months, indeed also some changes in the purchasing behavior of our biggest key account customers toward a little bit more local China content. So regarding the local competition, this is an important topic. So all over, China remains the most challenging market for us, and we are putting a lot of effort on the development there, which might take some quarters, as already said earlier.

And these are the management topics #1 now, and we will continue on the path of building up sales capacities driven by growth potentials in each market and of course, working on the Chinese market with a little bit more pressure than before. For more detailed information on Q1, please visit our website, so on the IR section.

Closing Q1, let me now go over to some thoughts on fiscal year 2026. So for '26, we expect sales revenue growth in the mid- to high single-digit percentage area. So this is unchanged. We saw there was a significant currency burden in Q1 with around EUR 12 million, so on the sales line. From Q2 on, looking at the development of the FX rates, this will be of minor importance. And according to the latest FX movements, approaching year-end, may even turn to positive, always, of course, assuming constant FX levels from now on. On the other hand, we see continuing positive trends on the sales development so that we can confirm our guidance.

From a regional point of view, all over, the trends are approximately as we had them in the last quarters with some specialties for Q2, which we discuss now. So as I said before, there were prebuying effects in Q1, and this will, to a certain extent, of course, be a negative impact for Q2. So there is a certain shift I mentioned before that we estimate it to be in the 2 to 3 percentage point area, so in the range of maybe EUR 6 million to EUR 8 million.

And that's why there was a slowdown in order intake after Q1, so in April and May. And in June, we saw, again, a very strong business development approaching the quarter end. And therefore, there is another effect in Q2 now. So the order backlog is now around EUR 10 million to EUR 15 million higher at the quarter end compared to the past quarters, and this will be then presumably shipped in Q3.

Some thoughts on tariff situation. At first, there was a refund of tariffs that we paid until February this year, amounting to around EUR 14 million. This was booked entirely in the operating income line and therefore, is impacting the EBIT margin in Q2 positively. So this is really a one-off for this quarter. And we just learned that it is not only booked now, it is also paid. So we got that money.

On the other hand, the tariff rates for cooking systems were again changed. So from June on, they were lowered from the 25% rate that we had before to the 15% from -- now from June on. And this will lead to lower tariff costs for 2026 compared to what we announced in the last calls. We now estimate them to be in the, let's say, higher EUR 20 million range, so maybe EUR 28 million, EUR 29 million or EUR 27 million to EUR 29 million area compared to the EUR 30 million, EUR 31 million that we assumed until this reduction. And this means year-over-year, around EUR 14 million to EUR 15 million higher tariff costs than in 2025. And to remind you of that in 2025, they were at around EUR 12 million to EUR 13 million.

In addition, as already commented, there will be higher costs mostly for components, for raw material, for logistics this year compared to what we initially expected. And so for 2026, in comparison to the situation when we gave the guidance, this will lead to effects in both directions. So positive one from the tariff refund, negative ones from the higher tariffs, the higher component raw material and logistic expenses. And we expect that these effects will more or less eliminate each other. So therefore, our guidance range is still valid.

And in concrete, this means we stay with this mid- to high single-digit growth rate guidance. On the other hand, due to the higher costs we saw, the COGS are going up, and this is, of course, a burden for the gross profit margin in a range somewhere between maybe 100 and 150 basis points. And on the other hand, with the continued investment in sales and services and in R&D and the stable costs in other areas that are not related to sales, we are then staying with this range that I said before in the 25% to 26% EBIT margin.

And after this short recap, so we are ready now to answer your questions.

[Operator Instructions] So Philippe is number one and then Ope.

So just to come back a little bit on your comments on the 25% to 26% EBIT margin. So that's now valid, but taking into account the EUR 14 million tariff refund that you got as well. So that's one of the positives.

Yes. The positive -- is the positive position and there is some negatives, which adds up some million here, some million there. And if we then compare that, the magnitude should be approximately on the same level so that we still stay within the guided range.

Yes. So -- and when you started in the year, you hadn't guided for that refund. So if I exclude that and I just look at the fact that you're saying the tariff per se, the new ones are a little less, let's say, negative than previously plus the input cost inflation, that's actually like a net negative that you would have had versus the guidance before the refund.

No, the tariff refund -- let's say, the higher tariff costs are included in this calculation, plus the higher logistic, raw material, et cetera, costs. They should come out -- it's all estimates. You never know this in detail. So for example, raw material costs are depending on the alloy surcharge development. When they get effective and then with a lag of a few months, we feel this in our P&L. So you cannot exactly say how much this will be now. But all over, we think that on the one hand, the EUR 14 million positive. And on the other hand, somewhere in this range, around EUR 14 million negative from these different positions should lead to sort of a wash in -- for the EBIT line in the end.

Okay. That's clear. And also just before you mentioned the tariff. So after mentioning the slowdown in order intake in April, May due to the prebuy and then the pickup in June, you were mentioning something around EUR 10 million, EUR 15 million higher. What was that was the revenue at quarter end?

These were order intake. So we saw, let's say, some slowdown in order intake in May and -- in April and May. And in June, it's strong. And this leads then, of course, to a result that we might not be able to ship everything in June. And so the -- we see this now that the order level -- the order book level is higher than in the last -- at the last quarter end. So this is sort of -- yes, a delayed sales, which is maybe missing a little bit in Q2 and will be then shipped in Q3. So Ope?

So three questions from my end. So just one on the tariffs and so it's rather obvious because you just gone through the point. So it's kind of you're expecting just above -- you were expecting just above EUR 30 million. Now you're expecting EUR 20s million tariff impact. Is that the way to read the comments?

Yes. So maybe difficult to say. So the -- maybe between EUR 27 million and EUR 29 million. It's difficult to calculate the exact effect now because it always depends on when did we ship it, when is it booked in the U.S -- on the U.S. balance sheet and then what was then -- when they sell it 3 months later, then it gets effective in terms of the P&L effect.

So that's why this is a little bit difficult to calculate. So we know it is going down, but there is not a complete effect now from going down from the 25 to the 2015 (sic) [ 25% to 15%, ] somewhat comparable to the comparison with 2025 to 2026, where we had a half year effect in '25 and now full year effect in '26. And now with the changing rates getting effective in the different -- yes, just with the delay, we estimate that there is maybe -- yes, half of the extra costs we had first in our estimates, maybe it is now going down again so that we come out with this higher EUR 20 million range.

Okay. And so -- and there was also the change in Section 232. Was that sort of -- do you mind just giving some color on that?

Yes. This is the Section 232. So we had the 25% getting effective, I think, in February. And then we had this change to the 15% now in June. So on our units, on our cooking systems. And so this change is causing why we are reducing the cost expectation now for this year a little bit.

Just ask rather obvious, are you sort of implying that Section 232 has gone from 25% to 15%, or is just the reciprocal element going away?

Sorry?

You sort of -- is the 25% on the Section 232 going to 15%? Or is it the reciprocal going away?

No, it just -- it will stay until '27, they said. So this 15% level is Section 232 by the changed rate. And this is now announced to be effective until end of '27 if there are no changes anymore.

Okay. And just two other quick ones. Do you mind just giving some color on the U.S. market and maybe like the institutional market, like is that weaker or ahead of expectations?

Yes. The U.S. market, all over, is developing well. So we had the experience now on the trade show in May. We saw the demand is huge. The positioning is good. And all over, there is good signs from the U.S. markets. So from that point of view, should be -- yes, if we do our -- if we are able to continue with the development of the sales organization, we think the growth in the 10% to 15% level should be realistic. So we had in Q1, 23% organic growth. This was maybe way too high, caused by the prebuying effects. And we will see maybe some lower rates now due to that in Q2. Maybe a little impact also for Q3 coming out of that, but that's difficult to say. But all over, I think we can continue with this double-digit growth rates as we expect.

Okay. And then just lastly on the prebuy. So is it in effect Q2 is weaker for two reasons. You have the prebuy -- or should be weaker for two reasons. You have the prebuy. And so effectively, you lose the EUR 6 million to EUR 8 million, but also orders -- some orders will ship -- will slip into Q3. And therefore, again, it's kind of weak because of Q1 was a bit too strong and it's weaker because Q3 might be stronger than Q2 due to some orders.

Yes. So I think I saw in the consensus, there is ranges of -- I don't have the single estimates, but the average is EUR 330 million. And I would say that maybe here, at least some of the estimates are not considering this effect of the prebuying and the end-of-quarter dynamic. So Lars?

Two quick questions. The first one is about electronic components, memory chips. You mentioned on the Q1 call, prices are increasing, but it's still manageable. The situation hasn't relaxed since. So I assume you're still facing increasing price levels. But the availability of chips is as good as it was before or has availability also become harder or more difficult?

It's a very interesting question. Yes, price levels are still elevated. That's true. And this is part of the cost increase estimates we are having. The availability, funnily, I met just our Head of the Landsberg purchase department, and I asked him whether there is some severe bottlenecks we are facing. And then he said, no. So nothing we need to really seriously talk about. And from that point of view, of course, price levels always are maybe a signal for an upcoming -- maybe upcoming bottleneck for the future, but we don't see this right now. So availability is according to what we see now, that it's not jeopardized.

Understood. And then maybe adjusting for the prebuying effect in the U.S. in Q1, if we adjusted Q1 and Q2 for that, would it be fair to assume the normal seasonal pattern, i.e., excluding this prebuying, I don't know, 23% of annual sales in Q1, 25%-ish Q2, Q3 and then the peak in Q4? Or are you expecting a different seasonality for this year, excluding U.S. prebuy?

You know that the seasonality is sometimes there is a percentage point more or less in 1 quarter. So this is also depending on some bigger orders we sometimes had in previous years or on some postponements from one quarter to the other. That's quite normal that from time to time, we have this. So all over, this might have a little bit seasonal impact that maybe it's flatter for the first quarters. But on the other hand, on the full year, there should be not a big impact.

So I would not expect that there is a too big effect from a prebuying in Q1 to Q3 and Q4. So from that point of view, maybe an influence, of course, on Q1 and Q2. That's why it's a shift from one quarter to the other. But I think Q3, Q4 should not be affected by that. So next one is Craig.

My first question, just continuing on the cost side, please. Can you kind of remind us of sensitivity these days for your gross margin for the changes in the nickel alloy surcharges and how that typically feeds through? And then I have a second question.

Yes, of course. So the alloy surcharge is approximately -- I don't have the exact figure now, but maybe 5%, 6%, 7% of the COGS depending, of course, on the level of the alloy surcharge. And if this -- of course, we had last year an average rate on some EUR 1.90 per kilo level. The expectation we had initially for this year was that it goes up by 10%, 15% or so to a little bit higher than EUR 2, between EUR 2 and EUR 2.10. Then we had some developments towards EUR 2.20 to EUR 2.25. So this was the expectation why we said in the last call, there is higher cost for nickel and for stainless steel compared to what we expected in the very beginning of the year.

Then in the meantime, we had some rocketing rates, up to EUR 2.50, when I think Indonesia announced a limited export level. Now it came back again to the EUR 2.20, EUR 2.25 level, but still higher than we had last year. And this -- the exact impact, it's difficult to say. We can calculate this, but I think this for this round would be maybe too far to go.

Okay. But to be clear, this is included in your comments earlier about the...

Yes.

Yes. Okay. All right. And secondly, just turning to the top line. I mean, you alluded to this in your own opening comments that the KPIs for the development of your sales capacity and all that, all that is developing in the right direction. So if we take that into account and then also the fact that you've got this high order backlog at the end of Q2. And at the moment, it sounds like you'll have at least a neutral impact on currency and might even get some tailwinds from that. It sounds -- am I right in assuming that you should see quite a -- or you're seeing an acceleration in that top line growth in the second half, again, ignoring -- netting out the prebuying effects, Q1 versus Q2?

No, I would say maybe that we go -- we are in the normal direction, that we say, organic growth rate that we had in the past quarters being in the high single-digit range. Some quarters are a little bit better. I think Q4 last year was a little bit higher. Then Q1, we had this extraordinary effect. And when you take out the prebuying and say, 3 percentage points of this 11% were maybe prebuying, then we are at 8%. And if we would add this in our minds to maybe Q2, I think we are on a stable, stable development path. So staying maybe in this organic growth levels in the high single digit, mid -- yes, let's say, somewhere in the -- yes, 8%, 9% range. Then Ope has a follow-up.

Just one more. Just thoughts on pricing in the context of sort of the lower tariff headwinds. Is the expectation that they kind of remain where they are and sort of again, if...

Price levels?

Yes.

Yes. I think Peter commented on that, I think, in the Q1 call that, of course, as we did it with the price increases we did now just for the U.S. that we normally, of course, try to avoid price increases as much as possible. As long as it's possible, we don't do it. But in special situations, we -- in the past, we did it in local -- mostly in local context, but in some cases, as in the inflationary period a few years ago also on a global scale.

So right now, there is, of course, different scenarios on. And as Peter said, there is no decision yet. There is discussions on different scenarios. And if it is not avoidable, and we see this necessary to do, there could be price increases. But to what scope in terms of regions or to what extent magnitude this would be, I think there is no decision yet, and we will not communicate on these details. But we don't rule out completely, but we try to avoid.

Okay. So it seems there are no more questions. Just a moment. Yes, if there are no more questions, thank you for participating in the call. And if there are any questions coming up, please let us know afterwards, you know our contact details. And then we meet next in August when we announce the Q2 or half year 1 figures. Thank you very much, and bye-bye. Take care.

Good afternoon, and a warm welcome to everybody. Welcome to RATIONAL's earnings call for the first quarter of the fiscal year 2026. The results will be presented by the CEO, Dr. Peter Stadelmann; and the CFO, Jorg Walter. Thanks to everyone who submitted questions to RATIONAL AG ahead of this event. We will post them in the chat box in a few moments for your convenience and to avoid potential duplications. [Operator Instructions] This will be recorded, and you will be able to access the call later on our Research Hub and on the RATIONAL IR page. With all this in mind, I will now hand it over to you, Peter, and thanks, everybody, for joining.

Thank you very much. Good afternoon, ladies and gentlemen. I would like to start our Q1 call with a short video on a customer in the U.S.A. As you know, there, we have our biggest potential probably for the next decades and a lot of work to do. COASTAL Orange Beach is an expansive outdoor dining venue designed to accommodate up to 1,200 guests at a time. So during peak season, they handle between 4,000 to 7,000 a la carte covers daily, which is, of course, a huge challenge and requires careful planning. The kitchen of COASTAL is nearly 100% RATIONAL with 21 iCombi Pro and two iVario Pro units. Let's listen to the corporate chef himself.

[Presentation]

Yes. What I like most is we haven't found anything that RATIONAL don't do well. So you heard Christopher himself talking about the efficiency gains and the high benefits they got from our equipment. That is why we call our cooking solutions multifunctional. They manage almost all kind of food. So customers do no longer need additional specialized equipment. And with that comes big savings, of course, in investment, in operating costs, in space, energy and of course, also in complexity in operating that kitchen.

Our great multifunctional and smart cooking systems, of course, deliver the benefit to our customers. And given that huge potential we have, not only in the U.S.A., but also on a global level, the question simply is how do we turn that into sales. And Christopher also mentioned education. This is very important to understand our way to market. We employ more than 630 former chefs in our sales force. They did more than 335,000 visits in 2025. That is more than 1,500 visits every weekday where our regional sales managers inform and educate potential end customers about the benefits they would enjoy with our equipment.

None of our competitor is doing that nor has won the resources and skills to do that. Even though being 10x bigger than us to build up that capacity would take years. Our business model and our way to market is unique. For us, this is how we create the pull effect from the market, from the end customer for our products and services. And as you see in the chart here, we are back on track of constantly increasing the number of salespeople, as you can see here. And with more people on the street, we will get more visits and then finally, more leads for more sales. That's it. This is why we are less impacted by external turbulences because we take charge of our own sales force to the end customers and not only rely on dealers.

Some of those external turbulences emerged in recent weeks. We would like to briefly comment on them. I start with U.S. tariffs. We did reclaim the tariffs that were not lawfully levied. Those amounts to more than USD 16 million. Our products are now facing a 25% tariff with regards to Section 232. This leads to slightly higher costs expected for 2026. That impact will be softened by the extra income from tariff refunds in Q2 '26. How the customer situation -- situation will develop remains to be seen and is difficult to predict. We all noticed the new announcement from President Trump over the weekend with higher tariffs for European cars, for example. So again, we will wait and see.

The second turbulence is the Iran war. To date, we have not had any significant negative impact on our business. The teams in the affected countries are safe. They are working remotely. Customer activities have been reduced or canceled until further notice. We all hope for a soon termination of this conflict.

The influence on the cost situation is also difficult to estimate at the given time. So let's have a look at our good results and more details I would like to start with sales revenues. In the first 3 months into 2026, we achieved EUR 318 million in sales. That is plus 11% organically and 8% after FX effects against Q1 2025.

The U.S. dollar was the main reason for that with an unfavorable year-on-year comparison effect versus Q1 2025 when the U.S. dollar was unusually strong. We expect negative currency impact to soften out during the year. We, for the first time, exceeded the EUR 300 million in sales in the first quarter -- as we slightly increased prices in the U.S.A. on February 1, early in the quarter, we do not expect reordering to have had a relevant impact on growth. That means that Q1 as normal was a new all-time high.

So far, we expect normal seasonality also for 2026. That means we will have slightly higher Qs and then a very strong Q4 at the end of the year. So sales and of course, EBIT will increase now from quarter-to-quarter. All in all, we are very happy with the start into 2026. And with that, I hand over to Jorg for more insights.

Yes. Thank you very much, Peter. And also a warm welcome to this call from my side. Let me now turn to our sales revenues by region in this first quarter. And overall, you see it clearly that the revenue was driven by Americas and Europe, while the development in Asia and in the rest of world were more mixed. This is a quite normal situation for Q1 numbers since the numbers are really based only on 3 months and the fluctuations are a bit higher than what we usually expect for the full year numbers.

Let's start with Germany. Here, we delivered a very positive growth of 11%, confirming a solid demand in our home market. On top of this solid demand, we had a special effect from one stockholding dealer that did not order in Q4 and now placed a quite high order in Q1. So this is influencing this 11% and we are expecting that in the coming months, this will level out a bit and the total growth rate for Germany will be on a lower level.

In Europe, except Germany, revenues increased by 8% over the year and growth was really across all the markets and regions. We saw a very strong momentum in several Southern and Northern European countries, including in Iberia, in Scandinavia, in Switzerland, and Austria. And those markets, they all could compensate for weaker trends in a few isolated markets such as Turkey or in Benelux. So overall, Europe remains our biggest region, very stable and reliable growth contributor like we saw for the full year last year.

North America once again showed a very strong performance. Revenue grew by 11%, mainly driven by the United States. We saw there a growth of 30%. And that was just a very, very solid customer demand. We saw the reference story just -- I think that is a very good example of what we really can do in the U.S. for our customers. We had a very substantial currency effect here. As you remember, the dollar devaluated last year starting in April. So year-over-year for the first quarter, we have a quite high currency effect. And just to mention, so before currency, we had a growth at 23% -- so very, very momentum -- strong momentum in the region.

And Peter just already mentioned, we do not think that there is a high impact from the price increases because it was really done in February, and there shouldn't be a special spillover to the second quarter or to the last quarter last year.

Okay. Now turning to Asia. Here, we have a revenue decline by 3%. That was mainly driven by a decline in China. We saw a certain, I would say, reluctance to buy in the light of the launch event that we just had for the new iCombi1, just after the Chinese New Year, and that was just happening in March. So I think the total uses to understand our customer, what we are doing with the iCombi1 hasn't been, let's say, communicated in a broad manner. That's why the Chinese ordering in the first one was still on a lower level. And however, that was partially offset by a solid growth rate in Japan, in India and in Korea.

And the smaller regions here LatAm and Rest of World, I don't want to comment too much on it. As I said in the beginning, just 3 months are not enough and that will level out throughout the full year.

Looking at the development of the product groups, you know that we usually expect the iVario to grow at the double growth rate compared to the iCombi. Here in Q1, we already have a triple growth rate. But also here, it's the same true. It's only the 3 months. And as I said, I mentioned this one dealer in Germany that placed a high order. So in the end, we are also expecting here that the iVario growth rate will level out during the coming year.

Let me turn to the development of our EBIT. In the first quarter, 2026 EBIT increased by 5% year-over-year. at EUR 76 million. At the same time, the EBIT margin came in at 23.9%, which is a slight decrease compared to previous year. Two comments here. First of all, the Q1 last year had a strong -- a strong comparison. As you remember, the FX effect were not part of the Q1 last year. The tariffs were not part of Q1 last year. So in that light, I think the EBIT margin in Q1 this year is quite strong.

And secondly, also, as you know, that we already have a slightly decline of the margin in our outlook for the full year, and that corresponds also here to the right numbers in Q1. Now let me walk you through our profitability development in the first quarter. We already talked about sales, plus a solid plus 8% Cost of goods sold increased by 12%, which is above the sales growth and resulted in a gross margin decline of 155 basis points to 57.6%. This development was expected by us. So it's not a surprise, and it's mainly driven by these two factors that is FX again and certainly also the U.S. tariffs that has a quite big impact.

So as a result, gross profit increased only by 5%. But as I said, this is around the level that also we expected. So we are fully in our plan. Looking at our operating expenses, we saw that targeted increase of 5% year-on-year also in Q1. The growth was clearly focused on our strategic priorities. So R&D expenses increased by 8% reflecting our continued investment into the future innovation and future product platforms. Also sales and service costs increased by 5%, mainly to support our customer-facing activities. Peter also mentioned how important that is. And at the same time, we were able again to reduce our administrative expenses by 2% to level off the total OpEx effect to a 5% that perfectly fits to the gross profit development.

And as a result, also the EBIT is on a higher 5%. And I think maintaining the EBIT margin as a strong 24% is a good result of the [ month ]. A very quick look into the balance sheet. I don't want to comment too much on it as you all know it, how solid it is. Just maybe one short view on the equity. You see that also now in equity for the first time in history, we surpassed or we exactly hit the EUR 1 billion. I remember, I think 2 years or 3 years ago, total assets were surpassing EUR 1 billion. Now we'll be even able to surpass or to reach the EUR 1 billion level in equity. But as you know, that is only a temporary effect. We will pay out the dividend in May that will lower the equity again. So it is just a snapshot in history. But with our growth story, I think we will come back to a EUR 1 billion equity level soon again.

Yes. And with that, I would like to conclude with our revenue and earnings outlook for the full financial year. The economic outlook of the commercial kitchen industry remains unchanged, unchanged means positive. The out-of-home market is growing. The food service market is growing and the challenges of shortage of skilled labors or the challenges with rising costs. So the need for our solutions, automated and efficient solutions such as the iCombis and iVarios, they are high. And therefore, we expect in 2026 to be another year of growth for us, and we expect to continue our long-term revenue growth trend in the mid- to high single-digit percentage range.

And regarding the gross margin, we saw -- already saw we stabilized the gross margin in recent years. Currently, raw materials and logistic costs, they are started to go upwards. In addition, we have this currency effect, the tariffs. So that's why we expect the gross profit to be on a slightly lower level below last year. Operating costs, we will increase all activities resulting in direct sales, and we will be very conservative with all other functions. And overall, we are expecting earnings to be -- to grow and to be in an EBIT margin range between 25% and 26%.

Now this concludes our presentation, and we are now happy to take your questions.

… for the insights, Peter and Jorg, and we do have a lot of questions that were handed in ahead of this event, and I will start out with the first question regarding pricing. And it reads, how is pricing acceptance evolving in the current environment, particularly in North America? And are there any plans for further price increases?

Yes. At this stage, we closely monitor market and tariff developments. Overall, we remain disciplined in our pricing approach, as you all know, the price increases implemented so far have been well accepted by the market, also in light of competitors having already raised prices earlier in 2025.

We currently do not observe any material change in customers' willingness to absorb price increases, especially including North America. In general, there is a low price elasticity. So -- and if you were listening to Christopher in the movie just a few minutes ago, he said, there is a necessity for such equipment. You can't go without. So there is no other way than just if you need them, you have to buy them. We do not have any information on competitors' pricing decisions regarding the new tariffs situation in the U.S. So we will also monitor those.

Peter, what trends are you seeing in terms of prebuying demand development in the U.S. and potential impact from geopolitical tensions in your business?

In Q1, we observed some prebuying in the U.S. ahead of price increases as usual, which led to a temporary pull-forward effect and fewer orders in March. But for the whole quarter, we don't see those. However, it remains difficult to quantify the exact impact. Overall, the U.S. market continues to perform very well. Regarding geopolitical tensions, particularly in the Middle East, we currently do not see any significant impact on our business. Near Middle East is roughly 3% of total sales of RATIONAL Group. The region, therefore, does not have a material effect at group level.

At this stage, we also do not see any meaningful changes in demand trends or customer hesitation heading into Q2.

How should we think about the current tariff environment in the U.S. and its impact on your margins in the 2026 outlook? I think Jorg, it's probably a good question for you.

Yes. Well, the units -- the current situation or second, with the introduction of the Section 232 on April 6, we are now subject to 25% tariffs on our import value of our units, which is a very high value. On the other hand, we have a slightly decrease on the tariffs for our stands and for other products. So overall, we expect the total tariff expenses for a full year this year to be around EUR 30 million in 2026. which is approximately EUR 5 million to EUR 6 million higher than in the previously anticipated number due to this change to the Section 232.

And it is reflected in our guidance. We expected a lower gross margin. We commented on that and also the additional tariff costs together with the higher input costs for raw materials and energy and logistics. This will be partly offset by the benefits from the tariff refund that we will mention in the second quarter. And so however, when looking at this bundle effect overall, we do not expect a major net impact on the group level.

You've already answered a little bit of the next question, which is how is the tariff refund treated from an accounting perspective? And is it included in your current guidance?

Yes, for the full year is included in the current guidance. I mean it is unexpected in our original scenario. But as we also have higher prices for steel and other raw materials, we have the Iran war. But overall, it is now part of our guidance. And it will be handled. We already, yes, claim all our payments in this official portal. They were already, let's say, accounted as, let's say, valid claims. We don't have a result yet. But as we already have a positive, let's say, reception message from the authorities, now we are ready to book that in the second quarter as an extraordinary result.

Can you provide an update on your business development in China, including the recent slowdown in Q1 and the key factors affecting current performance? I guess, Peter, that would be a good one for you.

Yes. In Q1, our activities were impacted by a combination of factors. The sales team was heavily focused on preparing and launching the iCombi1. There was a lot of training involved for them also, and that temporarily reduced regular sales activities. We also significantly expanded the sales force requiring onboarding of new colleagues and ramp-up time. At the same time, the market environment remains challenging with continued weak consumer sentiment.

The longer Chinese New Year period also had a dampening effect on business activity. Overall, we are seeing a mix of internal and external factors affecting performance. And we think it will take the next 6 months to closely monitor developments and derive potential actions. At the current stage, we won't be giving any concrete figures to sales or costs by the launch and associated costs are included in our forecast.

Great. Brings me to the next question also focusing on the iCombi. How has the iCombi1 launch been received in China? And how do you assess its contribution to future growth in the region?

Yes. We are very satisfied with the launch and initial performance of the iCombi1. We even had a key account ordering I think that was the first one last week. Customers feedback, including from the HOTELEX, which is the biggest trade show in Shanghai has been positive and interest levels are strong. Of course, they need now also some time to learn about the differences between the existing Combis coming from Germany and the new one coming from China.

While we are not disclosing specific sales figures at this stage, we see significant long-term potential for the product. Following the launch, customers and dealers are currently evaluating the product fit, which is, as I said, normal and ties up also some capacity on our side.

Overall, despite the current market headwinds, we remain confident that the new product, together with ongoing improvements to our sales organization will support future growth in China.

Switching from the iCombi to the iHexagon, can you give us an update in terms of sales development rollout progress and adoption across different customer segments on this product?

Yes, there are no major changes compared to our previous communication. Overall, we are satisfied with the iHexagon's performance so far and continue to roll out the product across additional markets. In 2026, we have already launched or are planning to launch in countries, including Benelux, France, Spain and Italy.

From a commercial perspective, we have broadened our sales approach and are no longer relying solely on dedicated specialists, but instead involves now the entire sales organization in all the markets where Hexagon is available. This is supporting further market penetration.

In terms of customer mix, we are increasingly seeing demand beyond large-scale applications, while initial use prices were often in major venues such as stadiums, you probably remember the movie on the stadium in the U.K. We are now also seeing growing interest from smaller restaurants and individual customers, which underlines the product's expanding addressable market.

We even had a speaker at our AGM last week, who has a restaurant or have two restaurants and for his new restaurants, he has been advised by Stefan from IR, finally bought an iHexagon for his new kitchen. And he commented on stage last week that he is very happy with it. So there was no better marketing for our iHexagon in front of the shareholders. That was, of course, the wrong audience, but it was for us very great to hear that honest feedback from our customer.

Jorg, a question regarding the gross margin. How should we think about gross margin development in 2026, including the impact from tariffs, raw materials and logistics costs?

Yes. I think I explained that already earlier in the call. So it is reflected in our guidance that we have a slightly lower gross margin. We definitely have now key headwinds coming from higher tariffs. I just talked about that in the U.S. Section 232 as well, we have increasing raw material and logistic costs. So these factors, they will put our margin under pressure. And I have also to admit a little bit on a higher level than we originally foreseen for the full year.

On the other hand, we talked about the unexpected tariff refunds that will balance that off. And so when we take all these effects together, we can confirm that we have gross margin, we will expect the gross margin on a lower level against previous year, but it will be softened by the tariffs refund.

Can you provide more detail on the key cost drivers such as steel surcharges, energy costs and potential geopolitical impacts?

Yes, sure. Well, the raw materials, when we come to the alloy surcharge, we see around -- we have a level of EUR 2.20 per kilogram, and that is roughly 10% higher than the average alloy surcharge that we saw last year. So from that side, we have some pressure. From an energy perspective, the direct impact is quite limited because our own operation, we have a relatively low energy necessity -- intensity.

On the other hand, we know that our supplier, they are also hit by the energy, rising energy costs. And therefore, it needs to be seen in what speed they will come and ask for -- to turn that cost effect on us. And -- but I think there is a quite big time lag between those two effects. So for the full year, the energy potential is quite -- or the energy effect is quite limited.

And geopolitical impact as our suppliers are really based all here in Germany or the direct suppliers, Germany, Hungary, Czech, Austria, it's very stable. The only topic we really do have is that we have to pay higher prices for electronic components due to this run for AI data centers. So that is something we are also facing, but we are able to secure -- we were able to secure our supply. So we were not hitting any shortages from the electronical side neither.

Peter, following up with a question regarding the development of your nonequipment business. Can you give us a feeling of how that is coming along and how pricing actions are contributing to margin protection in that space?

The nonequipment segment accounted for around 31% of total sales in Q1 2026, broadly in line with previous years and without any significant changes in mix. Regarding pricing, we implemented a price increase in the U.S. in February. However, due to some prebuying effects, as commented earlier, the impact of those increases is not yet fully visible in our reported figures. We expect pricing to become more noticeable from Q2 onwards and to support margin development going forward.

Can you give us a better understanding as to what the key drivers behind the weaker growth in Australia and Rest of the World were?

Yes. For Australia, as you might know, we have a long-standing partner there. The development is mainly driven by timing effects related to a large restocking inventory at the end of last year. That leads now to a lower order volume in Q1 over a long period. However, business development remained stable with no structural changes.

Jorg, this one is for you. How do you assess the outlook for your end markets and regional development? And what are the key drivers for growth in the coming quarters?

Yes. Also that I mentioned in the presentation, the outlook for the out-of-home market remains positive. Eating outside home is growing, the necessity for multifunctional units is growing. And for us, important that we continue our investment in our sales organization. That is what we did in Q1. We increased our sales force by 20 people just in one quarter.

So overall, we think that with that investment, and we will continue in the coming quarters to do so, we are on a good way to secure our positive market development even in a, let's say, unstable and quite difficult market environment. I think just the result in North America, what we saw in Q1 was really showing that also here in Q1 -- in the U.S., we have now a very good footprint with our salespeople, 60, 70 people in the street, and that's why we can continue to have a positive development that we will also see in the other markets.

Looking at the EBIT margin, you reiterated the 25% to 26% EBIT margin guidance, even though Q1 was a little softer. Should we think about margin progression as largely second half weighted? And what are the key bridge items from the current 23.9% in Q1 to the full year range?

Yes. The most important topic is operational leverage. I mean, Peter showed the quarters. And the first quarter is always the weakest quarter for us, typically then second and third quarter on a level -- on a higher level, on a comparable level and then with a record in Q4. We expect the same seasonality for this year. And just to mention the fourth quarter EBIT margin last year Q4 was around 28% to 29%. So that shows what leverage potential we do have. And in that respect, the 23.9%, nearly 24% in the first quarter is a good first step in order to reach our guidance between 25% and 26% for the full year.

Great. Looking into balance sheet and cash flow, can you comment on the development of provisions, liabilities and free cash flow and how these would evolve over the remainder of the year?

Yes. Well, there is no trend or seasonality that is unusual for us. Typically, we increase our reserves, our accruals for the bonus to the dealers for the bonus to our employees. And then we have a payout in Q1. That is what we did, and then we start to build up the accruals again. That is what's happening. That's why the cash flow in Q1 was a little bit on a lower level. And typically, the cash flow then in Q2 and Q3 to Q4, they are on a higher level and Q2 certainly then lowered by the dividend payout.

Great. Peter, a quick question for you. Could you remind us broadly how much energy costs make up in a typical restaurant?

Share of energy cost in gastronomy is between 10% to 15%.

Great. And in your addressable market, do you have a sense of the share of addressable kitchens that work with gas versus electricity?

Yes. Share of gas units is at around 18% and almost half of that is the U.S.A.

Great. Let's stay with energy costs. Can you explain what impacts you expect from higher energy costs within your own business, looking at direct costs, costs passed on from suppliers, et cetera?

Yes. So I said it's rather limited. So if you look at our own P&L, we have energy costs in Landsberg around EUR 3 million to EUR 4 million. When we take everything together in our scenario, so we can expect the cost effect between EUR 5 million to EUR 10 million. But of course, it's quite difficult to predict as the negotiations with possible negotiations with suppliers, they haven't even started yet.

Great. Looking at volume growth, you have 6% volume growth disclosed, which is basically 2% price/mix given that your organic growth is around 8%. Is that a correct assumption and calculation?

Yes. Excluding the FX effect, our organic growth was 9% in first quarter. And so less the FX was around 6%. And the remainder of the 2%, that was basically a favorable mix effect, meaning a favorable market mix and product mix. So especially we saw that the sales to the U.S. was high. U.S. -- in the U.S., we have the highest prices and also the largest models. So these two effects together, they make up for the 2%. And the price increase, the 4.9%, that was not really a big factor in that calculation.

And going forward, what's the effect you would expect from U.S. price increases on growth in the fiscal year '26?

That will be around -- for the full year, around 1%, maybe a little bit less, maybe a little bit more.

Looking at '25, can you come back on the drivers for your higher working capital cash outflow in the fiscal year '25?

No, I think the overall working capital remains on a quite stable level. We were a little bit higher on the year-end number because we had exceptionally high sales in Q4 -- and that was the reason why especially our receivables were on a high level, but on a normal with a normal DSO number. So overall, I think we are quite stable. And certainly, as we grow, especially outside also overseas, so we have a necessity to increase our stock in the U.S. We have additional stock in Brazil and so forth. So that's why also our stock is growing, but I think it's all in line and we -- our operational KPIs, they are very much balanced and on the same level. So we don't see any lower level and we are monitoring that very closely. So we are on an even development.

Peter, a quick question for you. How do prices for cleaning products develop given the sharp rise in costs for some chemicals and will RATIONAL pass these increased costs on to customers?

Our latest change was a decrease for prices of cleaners, which we already reported last year. We are observing the input cost development closely and will decide on potential actions accordingly.

To what extent did your own inventory in the U.S., Canada increase between December and March?

The increase of around EUR 10 million we see in the balance sheet is reflecting the development in the U.S.A.

Okay. And given the strong start to the year organically and U.S. price increases, are you expecting a different pattern this year in terms of the sequence of revenues?

No, we expect normal seasonality.

Great. And the last question that was pre-submitted on iVario. Any specific factors driving the strong development in the quarter?

No, no specific reasons, strong development in North America and Asia and Other Markets also very strong.

Great. These were all the questions that we had pre-submitted. In case anybody in the audience should have additional questions that were not addressed yet, please feel free to put them in the chat box on the lower right-hand corner. Otherwise, I will wait for a few seconds to give you a chance to type it in, even though I do not see anybody typing, which means that the questions that have been submitted were already quite comprehensive and covered most topics that are of interest to you all.

So the only thing that's left for me is to say, on the one hand, thank you very much for everybody who participated for the great questions that you did submit previously. Of course, to thank you, Peter and Jorg, for your insights that you provided. To also remind everybody who is in this call that the company is inviting you to participate in the IR follow-up talk, which will be held next week on the 13th of May at 2:00 p.m. Feel free to register on the IR page of RATIONAL. The recording of this video can be found also on the IR page at RATIONAL a little later today and also on Research Hub, where you will also find our research on the company. That's all I have. I wish you all a great afternoon. Thanks for your interest in RATIONAL. Goodbye.

Thank you. Goodbye.

Goodbye.

So now let's start. So good afternoon, everyone. So thank you for again participating in our IR talk today. A lot of well-known faces and some new persons, quite nice mix.

With me is my new colleague, Laura Deininger. Maybe some of you already met her. She just started in -- yes, in January this year at IR, but is not new to RATIONAL. She's there for, I think, 13 years now or so.

So a few hints at the very beginning, as always. So this call, on the one hand, is this maybe a follow-up on our earnings call that we had 2 weeks ago. And on the other hand, the last call or some guys would call it pre-close call for the Q1 2026.

With this call, we are following the ESMA recommendations, meaning it's -- we just talk about publicly known information. The call was made accessible to anyone who's interested via our website. And we would not -- presumably not share any material, but if we would do so, we would share with anybody. And another hint, the call will not be recorded by us.

So with this, let's start and we first start to summarize a little bit the most important points of fiscal year 2025. So sales revenues amounted to EUR 1.26 billion in the last year, which corresponds to a growth of 6%. And adjusted for the negative FX effects, our organic growth amounted to 8%.

And with that, I think that's a very, very important message. We are back on our average historic growth levels that we saw before this crisis years.

So from a regional perspective, North America, again, was one of the major growth drivers with a growth rate of 8%. Organic growth adjusted for the really significant U.S. dollar-euro effect was around 14%. And then again, Europe was quite successful last year with a growth rate of 9%, really with the broad growth we saw over the different countries. So from that point of view, very pleasing result in the European markets.

Asia was sort of a negative outlier for 2025 with a decrease of 11% compared to 2024. But from an operating perspective, it is really important to know that in Asia, we have a few big customers who have very big shares of the sales volume. And we had very strong years in 2023 and also in 2024 as we had the one-off effects due to the big orders from these bigger accounts. And eliminating these effects plus the negative FX effect, we saw our growth rate was at around 6%. So that's what we call the street business with the smaller customers was growing by 6% in Asia.

To be honest, that's still below our midterm expectations we would have there, but at least it's a growth, and it's not so far away from the expectations. When we look on the different product groups, again, iVario was very strong or stronger double as in growth as the iCombi segment with around 10% growth. And -- yes, this is indeed a growth rate we would expect also for the future. So 10% plus growth is the midterm expectation for the iVario.

When we now come to the gross profit side, we benefited last years indeed from costs for components, for raw materials and logistics that were stabilizing on a lower level. And with that, largely compensated for the additional tariff expenses we were facing in 2025.

And with that, the gross margin ended up on a level slightly below previous year and better indeed than expected. The operating costs, yes, they were growing a little bit over proportional to sales revenues as expected, mainly due to higher investments on the sales-oriented or customer-oriented positions as we increased numbers of people in sales and invested more in sales-related functions.

And in the end, with a little bit lower gross margin, with a little bit over proportional costs -- operating costs, indeed, the help of the positive or less negative FX result we need to say, compared to previous year. The EBIT margin was in the end with 26.4% in 2025, slightly higher than we saw in 2024. And with that, a little bit above our expectation, which was at around 26% initially.

What is important to say before we start to think about 2026, it is not only the figures that we saw that give us a good feeling and a confident look into the future, it is mainly the foundation of this success, which is the development of the sales organizations. So once we had left the crisis years behind us, so approximately by the end of 2023 or so, this means we again started hiring more salespeople, meaning we met more customers with these more salespeople. We were triggering more demand with that. And with that also the sales revenue growth came back on a path we think we could manage also for the future. So this means the mid- to high single-digit growth levels.

And this is now management focus number one. So -- and we will continue on this path of building up the sales capacities driven, of course, by the growth potentials we see in the respective markets. So not everybody can increase deliberately what he wants, but it needs to be potential oriented in the markets where we see the biggest growth potential. Of course, we will add more than in more mature markets like in Germany, for example. And for more detailed information, I think there is now plenty of information on the website. So then please go on the website and look there.

Closing 2025 now, let me now go over to some thoughts on the fiscal year 2026. Of course, this is, yes, no detailed information on the first quarter. This is something we will not do, but to give you some thoughts what might drive the business, what is our thought on the outlook. So we announced with the annual report 2 weeks ago, a sales growth guidance in the mid- to high single-digit percentage area. And I think there is no reason after 2 weeks why we should change that. We know already there will be, again, a burden this year coming from the currency effects, especially in Q1.

And if you look -- if you have a little bit of closer look at the currency movement last year and this year, you see that this should be of a minor importance in Q2, Q3, Q4, then it will go down or be neutral presumably. So from that point of view, this is indeed, yes, fading out throughout the year, so that we will be less affected by negative FX result throughout the quarters. And Q1, of course, was -- there was still a significant impact maybe comparable to Q4 or so that we had in the last year.

And FX rates, of course, are a burden for us. You know this. But when we look into the last year's developments, we were able to compensate the FX effect with good growth rates. And we are confident that with this foundation that we talked about before with the sales team development and if we should be -- or if we could be able to bring this into the new year, then of course, we would be able to compensate also the FX effects with the better business development.

So again, to go on a regional view, all over, we see more or less continued trends as we saw it last year. Of course, there will be some minor changes here and there. So the U.S.A. is our biggest growth market. You know this. And we are expecting continued organic growth, but also significant negative FX impact, at least for the Q1 and then this as said, will fade out. And I would say, looking at our competitors' figures for the last year, this is indeed a good success and also a very positive outlook. So we are, let's say, yes, good development in a weaker market environment. And still, the street business is doing well and still looking promising. But also we had this in the call regarding the key account business, we still see a good pipeline, and we are expecting to be able to grow now maybe from a lower starting position than maybe we would have talked about a few years ago.

In the U.S., of course, the tariffs are the most important topic many guys are talking these days. And as it looked like more clarity in the end of last year, now there again are a lot of question marks again after the Supreme Court decision. And so as Peter said in the call, we will claim back tariffs as much as possible. But whether we will be successful there, at which amount and when, this is another open question, I think we need to look. We do not include or we did not include these figures into our guidance, into our planning for the next year, which we announced with the earnings call.

And on the other hand, there is a discussion on the calculation base of the steel part of the products, which could lead then to higher tariffs. This would change. So here, there is really a big clarity in which direction it can go.

Europe, after having a good development last year with maybe a little bit more dynamic development than initially expected. We also see here continued trends. There is no reason for the most markets to think that there might be a significant change. So we will be following this path with hiring more people here as well, and I think we can stay on this successful road here.

In Asia, right now, the Chinese model is, of course, the most important topic we are talking about. We just launched I think 2 weeks ago now. The Chinese model produced in China for the Chinese market, and we are here expecting support for the sales side. And on the other hand, we know that China is still affected by a sort of negative consumer sentiment. And on the other hand, looking at this product launch, we know there is always some hesitation ahead of a new product launch, which might then dilute the situation and the figures to some extent so that we do not have clear figures after these 2 weeks on the short-term impact on our sales figures.

In the other markets in the region, we see sort of a normalization. We talked about this high volatility due to big orders from bigger customers. I think here, we are getting to more normality, but also with some usual fluctuations we have in these markets. And maybe another elephant in the room these days is, of course, the Middle East. Of course, our Middle East markets are also suffering sort of from the Iran war effects. The impact on sales is limited as this is just around 2% to 3% of our sales volume. And I think the most important for us is that our people there are healthy and safe. So all over, it's a burden for us, but it's manageable.

A look on the margins for next year, what is impacting the margins. Of course, the price increases we introduced in February will, of course, positively impact sales growth and margins, but they just get effective step by step beginning in early February because there were some level of preordering. There were longer-term contracts, for example, with key accounts. And so step-by-step, the new price level will then trickle in. And from that point of view, we see, of course, a positive impact on the margin, but to what magnitude, difficult to say in detail now.

On the other hand, we are facing now, again, higher alloy surcharges. So we benefited from a lower level last year, but they are going up again. Same is true for logistic costs and of course, higher tariffs we are facing this year because now it's fully effective, even if the Supreme Court decision is maybe putting some question marks on the height of the tariffs, but the base tariff of 10% that we know will always stay and the rest is something we need to look at. But still in our planning, as I said before, the tariff level -- the tariff regime that we had before is valid.

And this is, in the end, of course, causing higher COGS. And therefore, the gross margin will be presumably lower this year compared to '25. And I think the guidance, 25% to 26% for the EBIT margin is mainly coming from the gross margin. So this is around 1 percentage point. If we go from the level this year, 1 percentage point plus/minus whatever basis point level will be a negative impact on the gross margin.

And with the continued investments, especially in the sales and service and the R&D we are expecting now for this year as well. So we continue this. Also the EBIT margin will be lower. And here, the guidance was a level between 25% and 26%. So from that point of view, we think this is still a valid range we are expecting. And all over, we want to keep the costs, let's say, in admin areas, everything that's not sales related stable or at least increase disproportionately slower than the sales so that we get a positive contribution. But all over, a range of 25% to 26% is valid.

Okay. And from that point of view, I think that's now all from my side. I think a quick overview.

And now we already have the first question coming from Craig.

Stefan, I just want to follow up on the U.S. price increases, 4% to 5% going into effect from February. If you could just give us some color on how the customer acceptance of those price increases has been.

So all over, I think 4%, 5% is not really a big price increase when we compare it to what competition did. So I think the feedback and also when we look into the first -- let's say, the first figures, I think the price level is well accepted, and there is no big discussion about this price...

Olivier?

Stefan, maybe just the first one on any moves from competitors on U.S. price after the Supreme Court decision that you've seen? No, still no?

No, no change until -- I think you had the same question maybe 2 weeks ago, and I think still no change that we really see.

Okay. And then just maybe a follow-up. Yes, 2 weeks ago, you mentioned sort of the U.S. share of kitchens running on gas versus electricity. Can you maybe give us a sense of the share of addressable kitchens that work with gas versus electricity elsewhere maybe as well?

So the U.S. is in terms of share of gas units, really the biggest one. There is, I would say, every second kitchen, approximately 50% or so of our kitchens or of our units are running with gas and the rest with electricity. In other markets, it's way lower. I think in the European markets, we are below -- so we are on a level of 10%, 15% or so. I think the U.K. and Europe is a little bit higher, but the Americas are having the biggest -- way bigger than -- share way bigger than in any other market. All over, when we look at group-wide, we are at some 18% or so, slightly below 20% total share of gas units.

Okay. Okay. And then maybe just one more on the sales force. Is there a target level you're looking to reach in terms of salespeople by year-end?

There is a target level. To be honest, I don't have the exact figure now. But in general, the rule is if we want to grow by, let's say, let's take the 8%, then I think the rule of thumb is we need to add approximately 8% new salespeople because it's total business. We need to visit the people. We saw this. We need to have the direct contact that's very important. And that's why we then need to approximately add this number of people on the sales side, yes.

So I think the next one is Opey.

Stefan, you mind just sort of talking to, I suppose, Europe seems quite strong, especially Germany, quite interesting, obviously, given it's one of your more mature markets. So do you mind giving any color on what's happening there and sort of [indiscernible] extrapolate into 2026?

If we look on the growth figures, I think we need to look a little bit more longer term. As we know, I think we pointed out that quite frequently in the last weeks that sales figures are a function of starting with the salespeople activities, contacts. And then with this, we trigger more sales. And that's true for higher penetrated markets like Germany, where we then need to trigger guys adding a new unit or changing the unit or for less penetrated markets where we need to show that the potential customers or the advantages with more people, with more activities, we trigger more sales.

And in the European markets, I think the -- let's say, the building up the sales organizations after this crisis period was quite good. And after a few months, maybe 1 to 2 years, this translates into sales. So from that point of view, sometimes it's difficult to say whether this measure was successful or was responsible for a development that was 1 year later or it comes from another source. It's important for our sales organizations to continuously develop the sales capacities so that they continuously increase their contacts.

And so from that point of view, if you would ask now maybe -- and I did it last year in the late -- when we would ask our U.K. colleagues, they could say there is no special reason I could tell you which was causing this good development last year, but it's, in general, a good, I would say, foundation they were building up in the past years. But of course, if there would be significant crisis scenarios, then in the short term, even this would maybe not help. But in the long term, then it would persist. And after the crisis is gone, we would then be able to continue.

So is there more questions?

Christian and then Rory, I think.

I have two actually. So first of all, you've had a very pronounced increase in the revenue momentum in Q4. To what extent was this possibly driven by prebuying effects in light of the price increases you announced for February? So is there prebuying in Q4 and potentially then a softer trend in Q1? That's a question -- that's the first question. And the second one, to what extent are you exposed to any possible material shortages that might arise in the context of the Middle East conflict? So we hear about aluminum, for instance, and also certain alloys that could be -- where supply could be affected short to medium term?

So first question on the prebuying effect, there was some prebuying, but no big extent indeed. So I think Jorg was talking about around EUR 5 million or so in the call. So this was really limited. And from that point of view, there should not be a significant impact on Q1 coming from that. Maybe rather the other way around, there might be -- or could also be a slight impact that we see some prebuying that was in January. And so that people ordered and this will now be delivered in the coming -- in the weeks after or in the month after. So from that point of view, maybe this is compensating for each other a little bit.

Looking on the material supply, up to now, there is no indications that we might be affected. So our purchase department is always quite heavily looking on this. But right now, we don't see any potential impact. But you never know. So I think we could not rule out. We saw it in the chip crisis in -- yes, I think 3 years ago, we were affected then as well, and we had then to bypass. And I think we were quite positively reacting on this with the semi-finished goods. I think you followed this, and it was quite -- managed quite well from our colleagues. But right now, we don't see a scenario that this would happen, but we could never rule out for sure.

Rory, I think you were the next and then Opey.

Yes, I raised my hand. There was nobody in the queue, but I'll ask the question anyway. You may well have covered this in detail on the results call, so apologies in advance. But can you talk about Combi One e and the product for China in terms of how RATIONAL approaches the ramping of that facility? What is its capacity? I don't think you're going to answer that question. What's the size of the addressable market? How many people have you hired so far in assembly? But just give us more of an idea, if you can, if you haven't done already about the speed with which that business will develop? Or should we be very patient and this is a long-term approach to the street market in China?

So I want to start after your [indiscernible] So we will -- for the time being, we do not talk about these figures because I think it's too early. And we need to -- I would say everybody needs to be patient. We will closely monitor the market. I think -- as always, when you start with a new product line, it might take some time until the customers do their assessment whether this technology is fitting in. Maybe here is even a little bit different. Now they need to compare different groups. They say, okay, the new one, the old one or the Pro versus the one, and we look what fits better for us in terms of price and performance. And from that point of view, we need to monitor closely the market. But we will not -- for the moment, sorry for that, we will not give out figures from the first part of your question.

And presumably, in your guidance for this year, you're not assuming much of a contribution either from the iHexagon or the Combi One product in China. Is that's right? So it's kind of business as usual ex those two, it's really all about the [ iBarrier ] and the iCombi?

Yes. So there is not a significant impact from these two product groups. So that you would feel that on a group level, I think this is not the case yet.

So I think, Opey was the next one?

So just to clarify on the margin piece. So to what extent does the pricing this year sort of offset the tariffs, do you mind just giving like a rough percentage, I suppose is the reason gross margin is higher -- sorry lower than sort of the remain sort of the FX -- and how much like operating leverage we expect? I suppose I'm just trying to understand the different buckets of like a margin bridge where how much tariff headwinds versus price, how much FX, how much operating leverage might RATIONAL potentially benefit?

So on the cost side, I would say the biggest burden is coming indeed from the additional tariff bucket. If it stays as it was assumed until this new discussions that were opened. We were talking about, let's say, an incremental increase from '25 to '26 of around EUR 12 million, EUR 13 million, always assuming we at least potential changes are not included here. From that point of view, this is the major impact.

FX, as I said, will be a negative impact, difficult to say the exact magnitude, especially in Q1, but not from Q2 on. So there will be an impact, whether this is EUR 5 million, EUR 10 million, I think that's quite difficult to say now.

On the other hand, the price increases in the U.S., you could calculate yourselves. We are doing around a little bit less than 5% for approximately 90% of the sales volume because we don't increase for cleaning products. And this is starting in February or was starting in February, and I would say it gets effective to a level of 100% step-by-step somewhere during the year. So this is always also a difficult calculation now to look forward.

So from that point of view, you could calculate maybe a little bit the positive impact coming from the price increases. But this will help. And then on the other hand, difficult to really forecast is what impact will come from the alloy surcharge, what impact will come from the logistic cost that will go up. But all over, I would say, the guidance that we gave is say we come out with a margin level on the EBIT side, 25% to 26%. We come from 26.4%.

And I would say, if you go down this magnitude approximately also from the starting point of the gross margin because the major impact comes from the gross margin, mainly from the material costs. This is then the same level of reduction in the margin.

And operational leverage, to be honest, is something -- yes, operational leverage is always happening. You are getting increasing productivity. But on the other hand, you have inflationary effects. And if the productivity gains by growing in numbers are compensating for the inflation effects like higher wages or so, then this is something we deem as, let's say, look -- or we deem as realistic so that we cover inflationary effects. But in the long term, there is not really an operational leverage we are seeing.

Okay. And maybe just one more to piggyback on Rory's question. I get the main thing in China is the iCombi One, sort of what else are you seeing in terms of expansion into Tier 2 to 4 cities? Is that something that happens this year, sort of later on, therefore, this year or next year?

Sorry, I didn't understand the first part of the question.

Sort of iCombi One on China, in general, I suppose the bigger point is the new offering, the sort of how should we think of upside from sort of expanding into sort of more cities, so I suppose Tier 2 to Tier 4 cities, I suppose, just staying in Tier 1. Is that something that happens this year or next year?

You mean the expansion of the market or...

Yes, yes.

Okay. Yes. So right now, for the time being, we are working in the, let's say, existing network that we are having in China. So meaning there is a dealer landscape we are having. We are in the cities we are going a little bit. Of course, that's a major aim of it to go a little bit beyond the big cities where we see this huge potential with lower purchasing power, but the need for this kind of technology. And so from that point of view, I think it's a step-by-step approach. We will increase here the footprint, but we will stay within China as this is really a Chinese product with all the Chinese licenses, all the things you need to fulfill for the Chinese market, but not for other markets.

[indiscernible]

Two quick questions, if I may. I mean we already discussed potential supply chain bottlenecks. But when it comes to memory chips or the chips you need in your iCombis, iVarios, could that threaten your margin and put some pressure on the margin seeing chip prices having rocketed recently? Or is that manageable?

No, I would say in the, let's say, input costs that are going up, this is maybe one of the parts that we are looking at. And indeed, yes, they are going up, and they might have an impact on the margin as well, but difficult to say how much. So there will be a negative impact. But I think the alloy surcharge might be even more important for us with a really big share in the costs -- in the COGS.

Okay. Understood. And then based on all what you said, shall we expect the seasonality of your fiscal year to be as it was last year, i.e., a slightly weaker Q1 with 23%, 24% of sales and then Q2, Q3, I don't know, 24%, 25-ish and then 28% or something in Q4? Or are you seeing any differences for this year?

Very, very good question. So in general, of course, we don't know ahead of a year, whether the seasonality will be the same. If there would not be, let's say, a shock event or so that would slow down markets completely at whatever time, we would say that we are back in the normal seasonality pattern again. Whether this is then 23% or 24% or 23.5%, in detail, we can, of course, not say. But that we say Q4 will be the strongest or the highest level, Q1 will be the lowest level presumably and the Q2 and Q3 will be somewhere in between approximately on the same level. This is a normal pattern that we know. And I think we are expecting this again.

Maybe, Stefan, just a quick follow-up on China. I know it's early days, but how do you manage the sales launch? Are you hiring additional folks to cover the additional cities you're targeting? Can you talk a bit about that maybe?

Yes. And we hire additional people, that's for sure. So we already started this. I think in China, we are in a very difficult phase, let's say, that we said it before, also the Chinese markets are facing sort of a negative consumer sentiment these days, which makes it sort of more difficult maybe to start in this -- in such a market. But on the other hand, I think maybe it's also a good point to start now with the product. And we manage it in a way as we did before. We have big dealers. We invite them to events. And there was -- I think 2 weeks ago, there were big events or 2, 3 weeks ago, there were big events starting in -- or that they did it in Suzhou in our -- and in Shanghai, in our headquarters. Now I think is the [ Hotel X ] trade show. This is the next step where we show it to the markets. And then we work at first with the existing, I said before, with the existing network, and then we are increasing this step by step.

And are the salespeople selling only Combi One? Or is that also...

Both, both. That's what I meant before. For customers, there is now not only the decision, do I buy an iCombi or do I buy iCombi -- at all or not? If I decide for iCombi, do I decide for a RATIONAL or for a competitive product? And now I have two RATIONALs, where I say, okay, this one is fitting better. I need, for example, 300 degrees, then I need the iCombi Pro or I want to have the intelligence, then I need it say, for me, a simpler one is okay, then they would maybe go for the iCombi One. So here, both units are shown to our customers there -- in order to make a decision which one they prefer.

Perfect. So if there are no questions anymore, then let's close the call. If there is any question that's mainly related, you know our names and our numbers. You know where we are living. And then we close this call. We hope to have you on the Q1 call on 6th May. And I think we cannot find the link to register right now, but we will add this in the next weeks. And if there is any feedback that you're having for us, we're always happy to get them. And then I wish you a good time until 6 May and see you then.

Bye-bye. Take care.

Good afternoon, and welcome to RATIONAL's earnings call for the fiscal year 2025. Following the balance sheet press conference, which was held earlier today, management would like now to give you a run-through through the last year's results. That well done by the CEO, Dr. Peter Stadelmann and the CFO, Jorg Walter.

Thanks to everyone who submitted their question in advance, they will be answered after the presentation. To avoid duplication and for your convenience, I will post a list of the questions that have already been submitted. You will find them in the chat box on the lower right-hand corner in a few moments. Should you have additional questions, please feel free to enter them in the chat.

We're looking forward to an insightful exchange, and I now hand it over to Dr. Stadelmann, floor is yours.

Thank you very much, and good afternoon, ladies and gentlemen. We can celebrate again, its 50 years of combi ovens that we celebrate in 2026. We started in 1976 with the first convection oven where at that time, also steam was included, which made it a very multifunctional device with a great future to come. You know our history a little bit, some of you, 1979, we started to clearly focus on combi-steamers only. So we stopped producing and selling convection ovens, which at that time made up to 40% of our total sales.

The company doubled several times in the following years. In 1986 (sic) [ 1996, ] we were celebrating the 100,000th iCombi oven, and shortly after in 1987 (sic) [ 1997, ] we introduced ClimaPlus control. That was the globally first combi-steamer with a very precise control of the humidity in the cabinet.

2000, as you know, and as we celebrated a year ago was our IPO. 2004, we celebrated the launch of the SelfCookingCenter and the iVarioCookingCenter, our two first intelligent devices, which are able to cook on their own, so we don't need any chef's experience or knowledge in order to bring out high-quality food in high volumes.

In the following year, we constantly improved our existing product range. 2017, we added ConnectedCooking as the platform for our units to be connected. And 2018, also a milestone, we integrated the sales and brand of FRIMA, which was taking care of the -- at that time, VarioCookingCenter into the RATIONAL brand and into the RATIONAL sales force. Later on, we built our 1 millionth combi oven, which then helped the Hofbrauhaus in Munchen to feed its many guests. 2020, we launched a completely, completely new series of iCombis and iVarios, every unit, every product at that time was completely redevelopment and reassessed.

And then as you also might know, 2023, we had a big anniversary, we celebrated the 50 years of RATIONAL. A year later, we launched the next revolution after the first combi-steamer and the first iVario, we launched iHexagon, the world's only and first cooking solution, which combines three sources of energy to heat up food, convection, steam and microwave on six levels in high quality and high volume. Also in that year, we started the production site in Suzhou, China.

And if I'm going on to the last year, 2025, brought a new plant in Wittenheim, everybody attending our Capital Market Day last year, not yesterday, last year, was there. We produced the 1.5 millionth combi oven in February. And as we will tell you later, we came back from our product launch in China where we introduced the iCombi One last week.

Let me add one more slide here. Our 1.5 million combi-steamer was donated to a health institution taking care of severely ill children here in the neighborhood and was very well received. And let me add some pictures to the iCombi One. It is a perfect fit for Chinese kitchen, and we demonstrated in a spectacular show last week to more than 160 dealers, kitchen planners and key accounts, the new unit, and I'm happy to show you some more insights in a short movie, please let it roll.

[Presentation]

Yes, you saw that this is a perfect fit, as I said, for Chinese customers. The iCombi One will be sold through our existing sales channels with our existing dealers. We do the same kind of selling approach as we do for the iCombi Pro, which is still also, of course, on sales in China. It will be sold only on China Mainland. We will -- we do not have any plans to export that unit to other countries, its languages on the display are Chinese and English only so already, this is a clear focus on China.

How do we do all that? As you know, we pay a lot of attention to our employees. So also last year, we could honor 133 U.i.U.s, as we call them for 10 or up to 40 years of service with the company. We usually do a wonderful dinner with them, where some of our best chefs are proud to serve whatever they are wishing to have on the menu.

And another interesting thing I would like to show is a competition we won. We are in machinery #1 company of employees that share information and news about their own company on LinkedIn. So that also shows the pride and the ambition of our staff, they have with the company.

Let me finish with some interesting information on sustainability. We are happy that we did our first CSRD sustainability report for the fiscal year 2025, but much more we had last year a great study done in one of our customers' kitchen. That was the AXA insurance company in Germany. We installed a lot of meters for energy consumption and water consumption, and we were measuring the consumptions before the complete redoing of the kitchen and also afterwards. You see what was installed in the kitchen on the slide here.

And when we measured after the completion of the rebuilding, we could see that water consumption was down almost 50%, energy consumption was down 24%, the load -- the connected load that you need to -- the size of the cable, as I explain it usually, was down 20% and also more than 20% of peak times were reduced compared to the old kitchen. So all in all, we could prove together with the University Weihenstephan here, which did the research and the analysis, that our equipment is helping our customers to get more sustainable every day.

Also on everybody's news is the topic of artificial intelligence. Just an example, how we use it at RATIONAL, we have several, 10 thousands of units connected. And from that, we gain a lot of data and using AI tools in that data lake, we can now monitor and identify preventive maintenance needs, so we can -- or our service partners are able to tell their customers, there is a pump not working properly or your ceiling is not working properly. Let's repair it while your kitchen is down and not being affected by an unplanned down in busy hours. That's something we offer to our service partners, they then sell it to their end customers and we would provide those customers with a digital service report, which also gives them advice how to improve their sustainability or how to improve the usage of their equipment in total.

Let me finish with some new geopolitical risks. Both of them are coming out of the White House, the Oval Office. One is the U.S. tariffs. As you all know, some of those tariffs are unlawful. So we are in the process of asking those unlawful tariffs back through our customs broker. That's still in process. We can't say actually what the outcome will be as so far no other company also was successfully claiming some money back. So the impact on our cost and income situation is still quite difficult to predict.

The second issue is the war in Iran. Currently, we don't see any interruption of supplier logistics. Of course, delivery routes to Dubai are uncertain. We have higher container rates with surcharges and there are risks of higher energy costs and higher material prices. And also there so far, it is quite difficult to predict the impact on our cost situation.

With that, I would like to hand over to Jorg Walter for the second part.

Yes. Thank you very much, Peter. Also, a warm welcome to this call from my side. We published our preliminary figures for this year or for last year on February 5. And with this publication, we already commented on the most important KPIs regarding sales and earnings. And with this call, we would like now to take a little bit of deeper look into the financials for the last year.

Before we start, let's have a look at our sales reach. As a product-wise focused company, we are active worldwide. This is because we have customers. We want to reach customers all over the world and bring them our benefit. And this is important for our growth on one side, but it's also a very important element for our risk management.

We can actively achieve this only if we are close to our customers, when we know the needs and we can actively help to overcome their challenges. And the free market potential, you know that remains high, 4.8 million worldwide kitchens, addressable kitchens in the world, 75% of them still use traditional devices, 25% only have a combi-steamer or an iVario, so there is lots of opportunity for us, and that is important, while it's very important for us to have a high sales reach.

You see that we have -- we are active in 100 (sic) [ 120 ] countries of the world. We have 22 sales companies worldwide, and we are actively working on extending our presence, and this is also what we did last year. So last year, we hired 102 new employees. Of these, over 80% were located in our sales organizations and 60% are in the direct sales team. So our sales force now has a worldwide strength of 630 employees. And this is an important factor why we can again present good figures with new records. And this is, once again, we can prove that our business model is quite resilient against economic fluctuations or geopolitical tensions in the different regions of the world.

Now let's start with the sales. You can here see the sales development through '19 to '25. And despite the challenging situations in individual regions of the world, we continued our growth path. We achieved a new sales record of EUR 1.26 billion, and we were able to exceed the previous year's figure by 6%.

Now our growth rate was lowered by the unfavorable development of the currencies. Our foreign currency share is currently at 53%, the U.S. dollar alone accounts for 20% of our sales. And in particular, the development of the North and South American currencies, above all the U.S. dollar slowed our sales growth, adjusted for currency effects, we were able to increase our sales by 8%.

Look at the business performance during the year. We are very proud of the last quarter because we closed the fourth quarter with a new quarterly record of EUR 341 million and quarterly growth of 7%. And I just talked about the currency effect that was most noticeable in the fourth quarter. And before this currency effect, the last quarter growth was even higher at 11%. And that's on top of a previous year value that was already very high.

And when you look at the different quarters, you see that we come back to our normal seasonality. So we start with a lower first quarter, then we have 2 comparable quarters with the second and the third quarter. And then typically, we have a new sales record in the fourth [ year. ] And you see that this trend, after we were out of this trend during corona, COVID and during the supply chain crisis in 2024 and in 2025, the normal seasonality applies.

Let's have a look at the business development by region. Europe, excluding Germany and North America, they are our largest sales regions. Together, they account for 67% of our sales. And these two regions have had a significant impact on the group sales development with sales growth of 9% in Europe and 8% in North America.

Now the growth in Europe was, first of all, possible because we had a good normal sales development in the major -- the biggest markets we have, that is Great Britain and in France. And in addition, we've achieved double-digit growth rates in Sweden, in Italy, in Benelux, in Austria and in the Eastern European markets of Poland and Hungary. We are very, very pleased that we have been able to consistently exploit the opportunities that are available in Europe, close to our home markets and far away from the geopolitical conflicts.

Now in North America, our growth was 8%, and that was significant, once again, reduced by these exchange rate effects. Adjusted for the currency, we grew by 14% in this region. And this is even more positive because our competitors, they have reported low single-digit growth rates at best, and we see this as a confirmation of our strategy, not to compensate the unexpected tariffs through quick price increases on the market, but that we rather waited a little bit and we go for efficiency gains among other things, in all areas of our company.

Looking at Germany, we see that with EUR 129 million sales, we were able to achieve a new sales record and we doubled our growth rate from 2% last year to 4% this year. So it's typically because it's a penetrated market a little bit on lower level, and with 4% we are quite content.

Now we come to one critical factor, I would say, at this slide, it's the sales development in the Asian region. We recorded here a sales decline of 11%. But also here, it's important to have a closer look. There are especially two reasons for this sales decline. This is, first of all, we had a significant decline in sales with our largest Chinese chain account after the record sales that we had with them in 2023 and 2024. And the second effect was a decline in sales with our Japanese OEM partner, that placed in 2024 special stock orders, and that wasn't repeated in 2025. So excluding those two customers, we were also able to achieve the sales growth in Asia of around 6%. So in the general growth development of the group.

On the positive side here, I would like to mention that we were able to stabilize our street business in China, we had a double-digit growth rate there. And also in Korea and in India, we were able to achieve double-digit growth rate.

Now the two smallest regions, you see here, Latin America and the rest of the world, they showed also the same growth rate as the group as a whole, both were growing by 6%. Here, I would like to highlight the Brazilian market that is the largest market in Latin America, and we increased sales by 18%, and we were able to continue now a very positive development that we have here since 5 years in a row.

So to summarize this chart, you see that we continued to have good growth opportunities in our so-called established markets that are the markets where we are active for many, many years with our own sales force with a higher sales team. And we are -- also were able to find new customers in North America with our customer proximity and our offering despite the difficult condition caused by the unexpected tariffs. So overall, we are with the sales result quite happy.

Coming to the sales by product groups. Typically, we say that the iVario, because it has not the same time in the market as the iCombi, can grow with double the growth rate, and that was true also for last year. So you see that iVario in euro was able to grow sales by 10%, iCombi by 5%. If you look at the units alone, the growth rate of the iVario was 12%, and the iCombi was 6%. So also here, this double growth rate is true.

And also here, I would like to mention again, North American market and the South American, Latin American market that was particularly pleasing for the iVario because we were able to achieve growth rates of 30% and 40% here in these two areas.

Now coming to earnings before interest and taxes, that reached a new all-time high of EUR 333 million, in line with our new sales record, and we were able to increase the EBIT in line with sales development by 6%. And as a result, we stabilized the EBIT margin. It's slightly above the good previous year figures, and in line with our earnings forecast in the beginning of 2025.

Now looking at the P&L in more details, we look especially at the gross margin. Despite additional burden of the U.S. tariffs, we were able to stabilize the gross margin at 59%, and this is only 0.2 percentage points below the previous year's figure. This was possible because we saw an improved efficiency in production. And also, we, again, saw positive effects from lower raw material and purchase prices. So these two factors weathered the additional tariffs that we had to take on our account.

Looking at the operating cost, they rose slightly faster than the sales with a rate of 7%. Again, here, you see that we have increased or we have the highest increase in the R&D costs where we increased by 15% and thus continued to invest into the future of RATIONAL. We also invested slightly over-proportional in the sales area. So here, you see on the slide, the sales and service at 6%. If you only look at the sales numbers, it is an increase by 8%, and this is in respect of the additional workforce that we expanded in our sales team. On the other hand, we had savings. First of all, you see the administration costs, they are lower than in previous year, in the 2024 year. And also, we had a positive effect from lower logistic costs.

So overall, in light of the unexpected challenges due to the tariff situation and also due to the unfavorable exchange rate development, we are -- the management, Peter, myself, but also our other colleagues, we are quite satisfied with the EBIT development.

Now let's have a look at the balance sheet. We improved our balance sheet again last year, total assets grew by EUR 77 million to EUR 1.185 billion (sic) [ EUR 1.183 billion. ] This is due to an increase in equity of an amount of EUR 84 million. And this is due to the good earnings situation in recent years and in respect, their comparatively lower dividend payout. This has -- as a result, we see that the equity ratio has increased from 77% at the end of 2024 to now 80% at the end of 2025.

On the asset side, you see additional higher working capital for inventories and receivables. That's mainly due to this positive fourth quarter that we just talked about earlier. And then the main effect on the active side is certainly the high level of cash and cash equivalent. So that is bank deposits and the short-term investment combined of now just under EUR 540 million. And with this liquidity ratio of 46%, we are now in a very, very robust position. And this gives us, in particular, flexibility when we come to the dividend proposal later in this call.

Looking at CapEx, you see that our business model has a very low investment CapEx intensity. In comparison of the growth of our business volume in the recent years, we have a very constant CapEx in the range between EUR 30 million to EUR 35 million. And also in the last year, we are in this range of EUR 34 million. And it was primarily for our construction projects we already talked about earlier -- in earlier calls about those. I would like to quickly give you the last status. We start with our largest investment in the history of RATIONAL and our youngest investment project. We started the planning for a new service part distribution center in the beginning of 2023. Last year, in January, we had the groundbreaking ceremony. You see that in the picture on the lower left, and now you see on the picture that all the buildings are already standing and the interior work and installation of the warehouse technology that has begun, and we are quite confident that we will be able to celebrate the opening in spring 2027.

And now we can also report the, let's say, the finish of two important investment project. On the one hand, we have the new plant building in Wittenheim, Peter already talked about on the time line about it. You all know that we had problems with our concrete floor for the production hall and this quality problem was totally solved in the last year, and we had the move-in, the relocation of the production in October last year. So we can now say that this project is fully completed.

And the second completed project also, we talked earlier in this call about is the buildup of our production in -- for the new iCombi steamer for the Chinese market. We had the opening of the new plant in March 2024. Last year, mainly we worked on the buildup of the production facility, of the welding machines and all the assembly lines. And now we have the start of production in January. So also here, this CapEx project is fully completed.

Now we come to the dividend proposal. Typically, we distribute out 70% of our earnings per share. And we looked earlier at the balance sheet and we saw the very positive cash development and the very positive business development of the years 2023 and 2025 that led to these high liquid funds. And this is the reason that for the financial year 2025, we are proposing a regular dividend of EUR 16 plus a special dividend of EUR 4 per share to the Annual Shareholder Meeting in April. This represents now a payout ratio of 90% and is a dividend decrease against previous year of 33%. And of course, after the payout of the dividend, we still have enough liquidity in these challenging times to keep our flexibility and invest in the future of the company.

Now we come to the end. Finally, to the outlook for this year. The economic outlook for the commercial kitchen industry remains positive despite all geopolitical uncertainties. The out-of-home catering is growing. And due to the shortage of skilled labors, automated and efficient solutions such as our combi-steamers or our iVario are in a very high demand, we, therefore, expect sales to be -- sales-wise to be -- 2026 to be another year of growth and to continue our long-term growth trend with a sales growth in the mid to high single-digit percentage range.

Now the raw material prices and the logistic prices, they have stabilized in recent years on a low level. Currently -- Peter already mentioned it, currently, we have a trend reversal of steel prices and also electronic prices, they have risen since the beginning of the year. In addition, there is the full burden of the full year effect of the exchange rates and still the unclear custom situation for our exports in the U.S.A. And overall, therefore, we expect that the gross margin will be slightly lower below the previous year's figures.

This year, again, we will intentionally increase some of our operating expenses. These are especially all expenses that are connected with our sales process that brings us more closeness to our customers. And on the other hand, we will keep all non-related sales expenses stable and we will continue our efficiency program that we started in the mid-2024. We still have the same policies in place, especially the very conservative hiring policy here in Landsberg at the headquarters.

However, overall, also we expect the OpEx to increase a bit more than revenue. And with all these three factors, sales, gross margin and OpEx, we are expecting compared to sales, a lower increase of the EBIT and with a margin -- EBIT margin between 25% and 26%.

So with this, we are at the end of our presentation. and we are opening now the Q&A session. Thank you very much.

Thank you so much for the insights and congratulations again on a great fiscal year 2025. We're now diving into the Q&A, and we have indeed received quite a few questions already, some prior to the event and some during the event.

So without further hesitation, we're going to dive right into the first one, which reads, how does the removal of U.S. tariffs affect your pricing decisions, competitive positioning and expected fiscal year '26 growth? And have you seen any pricing moves from competitors. And this question is for you, Peter.

Thank you. Tariffs right now have not been removed totally. So we still have to pay the new temporary tariff of 10% for our units and the remaining tariffs on the value of stainless steel within our products, which is at 50%. So we do not plan any changes of prices, and we did not see any moves from competitors so far, given the fact that we raised prices quite late in -- early in '26, but later than everybody else, we think that we improved our competitive position.

Staying with the same topic, were tariffs the major reason for lower gross margins? And to continue with this, what tariff levels do you expect for 2026, how much of the 2025 tariffs could be refunded? And is the cost of goods sold increase tariff related? And last but not least, are any potential refunds included in the guidance?

So major impact on lower gross margin in 2025 was from tariffs. We compensated that by lower raw material, logistics, components costs. Expectation for 2026 is also difficult, as I said in the presentation, we will claim refund up to USD 15 million, the decision and the timing of that is completely open.

Switching to China. Could you outline the commercial and production ramp-up of the iCombi One, including customer reception and strategic fit as well as the expected impact of China-related investments and operating expenses drag on margins, P&L and fiscal year '26 EBIT?

We launched the iCombi One a week ago on Tuesday and Wednesday. So we had very positive feedback on site from dealers, from key accounts and from kitchen planners, as I said, 160 were on site during two events. We do not disclose yet more details on volumes nor capacity at the moment. As usual, we do not expect any margin dilution by that new product. The strategic fit in my eyes is high since we really tailored this unit to be perfect for Chinese meals.

Could you please explain what performance or order activity you see in the iHexagon, how you do see the further rollout and what management has learned about the market potential since the launch?

Yes, we still see good growth from, of course, a low level. No major impact on our financials expected for the short-term view. We focus still on creating awareness, broadening the scope with -- since 2026, more countries now and customers group. We included France, Sweden, Spain and Italy. I think those are the European markets we added to the former existing three markets U.S., U.K. and Germany. So we have a broader market base now and see more and more, I would call them, normal customers buying the iHexagon for their special need of high speed in high volume.

Great. Can you please give us an update on the iVario?

Yes, after crossing the 10,000 unit mark last year, we see continued growth this year. The ambition is still to grow approximately double as fast as with the iCombi product. Last year, major growth drivers were the Americas and Europe.

Going to the issue of energy costs, and this is a question for you, Jorg, effects from increasing energy costs for you and your customers, including effects from the Iran war or potential future effects of the Iran war?

Yes, certainly, we are also looking at the energy, development of the energy prices. We typically have quarterly contracts. So for one quarter, we are fixed, and then we renew this. The volume is quite low. So we have EUR 3 million here -- just to give you a number, EUR 3 million here in Landsberg on energy costs and in addition, around EUR 2.5 million for the fuel for our company cars.

So I think the change and the increase, yes, will hit us, but it will not be significant. For our customers, I think that is very relevant because energy is a very relevant part of their total cost, and that will be even, as you know, beneficial for us as efficient cooking in a closed climate with an iCombi is beneficial then for them.

Great. Coming to the next question, in '25, R&D costs increased by roughly 15%. Can you give us more background on the reason for that?

Well, first of all, we invested in more people in R&D. We now have over 300 people in the R&D area on these three sites, the biggest team here in Landsberg, but also we have a team in Wittenheim and a small team in Suzhou. So this is an increase, and then we have some external development costs that are connected with our projects. But also what is important to mention, we have -- due to the new site that we have in Wittenheim, we changed the allocation of our overhead costs, and that also had an effect on the cost increase that we're showing here. If we take that effect out, then the cost increase would have been at 11%.

Staying with the P&L, tax rate in '25 increased to 25.6%. Where do you see 2026, should we expect a further increase?

No, we don't expect a further increase. Typically, we calculate with a tax rate of 24%. And last year -- in 2024, we had a positive impact through the capitalization of deferred tax assets. And in last year or in 2025, we had a special depreciation of that asset. And that's why if you look at the P&L, the tax rate looks a bit higher. But going forward, we are expecting to go back to 24%.

Got it. CapEx, do you have any programs, investments remaining in the coming years? You've briefly touched on that, but could you give us some more insights?

Yes. Well, we will stay with this low CapEx intensity that we saw. So we will typically further invest, but we will continue certainly with the service parts center. So this was part of the CapEx in 2026. Also, we have plans. We have currently in Landsberg, part of our U.i.U.s that are working in rented offices, and we have plans to build a new office center here in Landsberg, but this will start in 2027.

Looking at the dividend, is the expectation that the normal dividend will rise significantly so that some of the EUR 4 special dividend you've paid before becomes part of the normal dividend?

Well, first of all, we expect rising EBIT, and that means that we will also have rising dividends. For the time being, we keep our policy that we dividend out 70% of our net earnings. And then depending on the liquidity situation and also the general current economic situation, we will then decide on these special dividends, but that is now too early to do so for the next year.

Coming to the next question, which is for you, Peter. How does management assess the potential of the key account activity in the U.S. for 2026?

Yes, we have an unchanged positive opinion on key account business in the U.S., which is, of course, much more important compared to other markets. The pipeline is full. We are with so many brands, I need to get back to my list, Hooters, Denny's, [ Albertsons, ] Cheesecake Factory, Holiday Express, Freebirds, Moe's, Schlotzsky's, Walmart, Sweetgreen, [ Wawa, ] just to name a few, and there is much more to cover. So we are very positive, but I also would like to express that our main growth contributor also in the U.S. remains the street business.

Understood. Talking about guidance, can you put some more concrete color around your fiscal year '26 growth guidance and the trading momentum you're seeing at this early stage of the year? And what are the key factors that will determine where you will ultimately land within the 25% to 26% EBIT margin range in fiscal year '26? And last but not least, how much of the current external uncertainty is already reflected in that guidance?

Yes. So as you know, our growth is always organic, and we produce our growth by hiring new salespeople. So simple and easy as it is, and we are definitely back on track since last year by adding new sales colleagues in all our -- almost all our markets. So organic growth, we expect in the upper single-digit percentage area. Negative FX leads to somewhat lower levels for reported earnings growth nor the impact of new tariff developments are included, neither those of Iran war and impact.

Region-wise, like long-term growth prospects more from overseas, less in Europe, as we showed last year. We didn't get -- we didn't publish any guidance on Q1 yet, but for more general trends from the last quarters that is continued. And as I said, some unsecurities through tariffs and Iran war remain.

Next question regarding cash flow is for you, Jorg. The cash flow was rather low. Can you give us some more background on where that was coming from?

Yes. There are mainly two effects to that. First of all, we had higher tax payments that we did in 2025. And then also, we had a change in working capital, especially due to the very, very high sales in the last quarter. And also in the last quarter, we had very high sales in December, and that brought us to this very high receivable position, and that is the reason why the cash flow was a little bit lower.

Coming back to the Iran issue. How is your business doing in the Middle East? Can you give us an outlook? And which element of the supply chain would become the first problem with regard to the Iran war? And that's a question for you, Peter.

Yes. Total sales in Middle East is just around 3% of our total revenue. So it will not have a major impact on sales. It didn't so far, and we don't expect it to have for the near future.

Also within the Middle East countries, we don't see a major negative impact. Supply chains are not interrupted. We don't expect it. Higher cost for energy and raw material are expected, but the magnitude is so far difficult to forecast for the time being.

Coming to operational expenses, which measures did you take to stabilize the administration costs in 2025? And can you give us an outlook on your cost development, especially on wage and logistics costs expected in 2026 and beyond? And I guess that's a good question for you, Jorg.

Yes. Well, first of all, we invested quite a lot in our digitalization during the years 2022, 2023, 2024. That is the reason why it was quite easy for us really to establish this efficiency program, mid-2024, what we just said, okay, we have a hiring stop in order to gain these efficiency. And that was, let's say, the most important measures. And I think the reality showed us that we were not suffering from in any respect, implementing this measure. And this is what we're continuing. And then certainly, we have the normal processes in terms of our budgeting process that we have very restrictive now and that are the most, let's say, elements we are using in order to get the -- to keep the costs under control that we -- like we had done so in 2025.

When we look at the wage development, we just announced that we will have in Germany in this year, a wage around of 3.5%. That is a little bit above the average, and we did so because our earnings are quite well, and we want to, let's say, participate the employees, especially also from their commitment to do the -- to go the efficiency measures with us. So 3.5%, that is what we do in Germany. And then worldwide, it's very country-specific market by market. It would be too early to announce that now.

When we look at the logistic cost, that's a hot topic right now. So typically, when we did our planning, we expected logistic costs to be a bit on the higher side. Now with the Iran war, we said that they are skyrocketing. We have special fees per container, and so it's very difficult to say now how that plays for the full year. But right now, we have a quite special situation when it comes to logistic costs, especially all for containers for the overseas shipments going into the east.

Let's look at productivity. Can you give us a feeling of how much productivity increased in your production in 2025? And do you have a target for 2026?

Yes, there is a number that we keep fixed since many, many years. So our productivity target is 5% to 6% per year. That's what we overall achieved last year, and that's also what we have as a target for '26.

Great. Looking at sales in regions, sales decreased by 11% in Asia in 2025. Can you give us some more color on why that happened?

Yes, I already explained in the presentation, it's really due to the two customers that we have. That is this Chinese key account that we do have on one hand side. On the other hand, it's our Japanese OEM partner, Fujimak. Taking all these two -- taking those two counts out, then our sales increase was at 6% on an FX-neutral basis.

All right. Looking at the forecast, can you please give us a bit more color on cost management ahead of 2026 in order to support margin and partly offset the impacts that may arise from the geopolitical conflicts and ongoing tariffs? What are the main lever to leverage?

Well, I think there is nothing special to say. So we are watching the situation. We are hoping that we can weather the higher input costs through efficiency gains. We always say that we are not planning for price increases just for the sake of price increases. But on the other hand, we are also able to do so when we think that these effects are getting too big magnitude, yes.

And other than that, it's the normal process. I talked earlier about it, restricting hiring in the headquarters. We expect our sales force in the R&D area to be also stable and not to increase it any further. The only buildup that we really plan is in the sales force. And I think that is quite also directly and bringing a return on that investment quite quickly.

The next question is for Peter regarding pricing, would you expect additional price increases in 2026?

No, we do not plan any major price increases, we just heard that for us, the very important statement that we want to offer highest customer benefit for a reasonable price. I would like to add here that our prices are not higher than the best units of our best competitors, we are on the same level, but offer much more, especially also a lot of services for free like the ChefLine, like our Academy or the on-site instruction after the first unit, for instance, has been installed.

And Jorg, if you could tell us the fiscal year 2025 non-unit business, what's the share of non-unit business?

Yes. Last year, the share of the non-unit business was stable. It's at 30%. And so you can say 10% is accessories, 10% is spare parts and 10% is cleaners.

You briefly talked about the positive outlook for the gastronomy industry, the hospitality industry in your markets. Can you give us a more specific outlook for that? And the question goes to Peter.

Yes. So our outlook also for the gastronomy industry is positive. Out-of-home sector is growing globally. We have more and more people living on that planet. My first granddaughter, [ Bobby ] was born yesterday evening. So she also needs her food later on. All the people living on this planet are getting older. The standard of living is growing, which means that we -- the money spent on food out of home is increasing. There might be a shift, of course, between the different sectors. So from typical restaurants to quick service restaurants or from restaurants overall to food bought at a retail supermarket, that's happening. But for us, that's not a challenge since we serve all of these customer groups altogether.

The margin beat in 2025, can you give us a little bit more granularity as to where -- what were the driving factors behind the beat versus the previous guidance that you had put out? And that's a question for you, Jorg.

Yes. Well, I think in the presentation, I also showed that looking at the gross margin, it was quite stable. Also looking at the OpEx development this quarter, there are no big fluctuations. So I think it's a bit of everything. First of all, it's a higher productivity in the production process. That was important. Also the variable input costs for material, stainless steel, they were really on a low level last year, but also logistics, components. And then on the OpEx wise, it is our productivity improvement program that we initiated. So all these factors together. It's not the one building block. It's rather a little bit of everything.

Great. Regarding sales organization, to what extent is your growth driven by underlying demand versus continued expansion of sales capacity? And how should we think about sales force productivity and scalability going forward? And that's a good question for you, Peter.

Yes. So it is not either/or for us. The demand is given. So we know the potential, which is still huge. Jorg mentioned that only 25% of RATIONAL addressable kitchens are already using combi-steamer technology. So there's a huge number of customers we need to inform so they know there is something like a combi-steamer and inform them about the many, many advantages they serve to them compared to traditional equipment.

So what we need to do is we need to increase our salespeople, feet on the street, as we call that. And if we do so, we are very confident that growth will come from that. We demonstrated that, especially last year. We do another sales approach than most of our competitors. We go to the end customers. Almost none of our competitors is doing that in the same way. They usually only work with dealers.

Productivity of sales force is, of course, increasing. The more experienced the salesperson is, the higher the target we set for its annual units to sell and for the customer activities, we expect from a single person. So that's, for us, completely normal daily business and scalable, of course.

And with which measures did you successfully counteract the weak market environment in North America?

Exactly what I just said. We increased our people, the number of salespeople in the field. We increased the number of activities. So that means more customer visits, more invitation or not invitation, more participation of customers at our RATIONAL cooking live and so on. So by increasing the number of activities, finally, that will lead to more order entry.

Great. Jorg, could you give us a feeling on U.S. and European organic growth?

Yes. So we saw in the presentation that the growth in Europe was 9%. And when we look at the organic growth rate, it's also very close, 9% to 10%. It's really only the British pound that is in there. U.S., I mentioned that earlier, the FX effect is quite high. So we reported 8%, but when we really look at the FX effect or the organic growth, we were around 14%.

Great. Looking at organic growth -- volume growth, you're looking at 6% volume growth in 2025 and organic growth of around 8%, meaning that you have roughly 2% coming from price mix. Is that a correct assumption?

No, that is, in that respect, not correct. We didn't have any big price changes, decreases. We only had one price decrease that was quite low for cleaners in the beginning of the year for our cartridges, that is a minor effect, but then we weathered this effect by 2 or 3 minor FX-related price increases. So the total price change was nearly 0. So the difference really between the 6% and the 8% is all currency.

Okay. Great. Peter, have you seen any changes in regards to the competitive environment recently?

No, we didn't see any major changes in the competitive landscape. We expect to have won market share since we outgrow most or I would even say all of our competitors organically.

And Jorg, the EBIT margin in Q4 was very high, 30% in constant currency, I guess, this is what it means. Can you give us some more background on that?

Yes, it was basically very much related on a very positive sales development in the last quarter. I commented that with EUR 341 million in the last quarter, it was very high. We had a record December. And that certainly with a normal cost base that is more or less fixed for a quarter that led to a nearly 30% EBIT margin in Q4.

Operational leverage, basically?

Yes.

Great. EPS in Q4 was down by 1%. Can you shed some light on that, too?

Yes, that is in relation of the deferred tax asset that I commented also earlier. We activated tax asset in 2024, and that was due to, let's say, tax calculation of the earnings distribution between the different companies. And a part of that effect, we had to reverse in 2025 and that was booked in the course of the year-end closing accounts. And that's why it was, let's say, 100% attributed to the Q4. And that is why earnings per share is -- there is a decline, but I think it's not a Q4 effect, it's a full year effect.

Okay. Great. Looking at Q4, the accounting tax was rather high and the paid tax was rather low. Is that related to what you just were talking about? Or is there another reason behind that?

No, no, absolutely. That's what I was talking earlier about it.

Great. And CapEx was rather high in Q4 as well. Can you give us some more background on that?

Well, we are making good progress, especially we are in the hot phase. You saw that on the picture for the service parts distribution center. So many invoices came in, in Q4, and that is the main effect why we had this Q4 -- this high Q4 number.

Okay. Great. The next question reads, in 2016, gross margins during the quarters were near 62%. They have reached back to 59% during 2025 quarters. Despite price increases, gross margins have not reached the 2016 level. Why?

Well, first of all, we introduced the XS unit in 2016 and that had a significant effect, roughly 1 percentage point on the gross margin. So we're coming down. And then also we had a reclassification of the -- of some service spare parts related with our warranty. And that is basically a fact why you cannot fully compare today's figures with 2016 figures.

Okay. Understood. Looking at China and the iCombi One, can you give us a bit more understanding as to how many units and what sort of margins you would expect looking at capacity that you have in China build up presently or planning to build up? And whether the version that you're selling is basically just a simpler iCombi version? And if you have started selling? And also, what's your planned time line to reach 60% to 80% roughly of capacity utilization in that country?

Yes. Well, at this time, we do not disclose the capacity or the sales figures for the iCombi One. We are just in a very early process. Well, it's a simpler combi-steamer that is especially designed for China. It has a lower selling price. The price difference to the iCombi Pro is around 25%, but we can say that when you look at the COGS or the manufacturing costs, the margin is comparable. So we also have lower COGS, obviously, in China, but that is very much depending on the capacity utilization. So in the beginning years, we still expect a negative effect on the overall P&L. And then for the coming years, it will be positive year-by-year.

Understood. One question for you, Peter. Looking at North America, and we've touched on that partly already. Question reads, you had strong sales in North America, 15% to 20% plus, especially in the periods 2016 through '19 and 2021 through '23. What were the driver at those times for those rates? And what growth rates would you expect over the next 3 years? And what will you do to achieve these targets? And what are the drivers of strong growth in Europe last year in 2025? And how sustainable is that?

Yes. Somebody was back into past figures, I see. As I said, our growth is produced by hiring more salespeople. So again, very easy and simple, sometimes boring. That's what we need to do. If we add more salespeople, we have more activities, we have more customers informed and finally convinced to buy modern multifunctional equipment from RATIONAL. Even in markets that are more penetrated, we condense the sales territories by just adding maybe one new colleague and adapting the existing sales territories.

In North America, we expect double-digit growth to continue organically, currency might dilute that as we saw last year. And also in Europe, we also expect to have continued growth so that is sustainable. I would not take the years '21 to '23 to compare since we had the pandemic first and later on the supply crisis, the shortage with many electronic components which, to be honest, really got volumes and prices completely out of order. So we also had to increase prices at that time, which we usually don't do. So figures from '21 to '23 might be not much helping in a comparison.

You've already issued the guidance for '26. Can you give us a feeling? I know that's probably difficult, but maybe a gut feeling how well the 2026 year started for you so far?

Yes. We commented on that a little bit, but we will not disclose until, I think, early May Q1 figures.

All right. Can you explain the impact of higher energy costs within your business? And I know we've touched on that briefly as well. But being more specific, looking at direct costs and costs that you can pass on from suppliers and maybe pass on to your end clients? And that's a question for you, Peter as well.

Yes. So typical share of energy cost in gastronomy might be 10% to 15%. With our gas units, it would be around 18%, it would be higher. And of course, higher energy costs make it even more important to switch from traditional equipment to modern iCombis or -- and iVarios. I just would like to state again those savings, we demonstrated with the AXA case, 50% of water, 24% of energy, that's a big chunk in the P&L of any restaurant. So it is -- sorry to say so, all factor prices going up, rental costs, wages, energy and raw material help our business because it's even more economic then to switch to modern multifunctional equipment.

Great. That also addresses most of the next question. But -- can you give us a sense of the share of addressable kitchens that work with gas versus electricity, with the split is? Probably it depends on regions as well, but just the rough estimate.

The biggest gas markets are the U.S.A. Do we have some numbers somewhere? In the U.S., it's roughly 50%. So half of all the kitchens are running on gas.

Great. Jorg, how much prebuying did RATIONAL observe in the fourth quarter ahead of price hikes in the region in early 2026?

Well, as we did not increase the prices as of 1st of January, nowhere in the world, the increase or the spike was very limited. However, I have to say, as I said earlier, we had a record December, and I estimate between EUR 5 million and EUR 10 million was maybe the year-over-year shift that we had, especially in the U.S. market and also in some Latin American markets.

We've talked a lot about how relevant salespeople are for you, the feet on the ground, as you said. You have 1,134 people in sales and marketing. The question reads, how many of them are working in sales and as a comparison, '24, there were 605 is the number that the question gives us.

Yes, we are now at 630, and we have some 100 freelancers in addition, which help us at trade shows or unit introduction but the 630 are on our payroll.

And Peter, we've talked about capacity in China, which we don't want to talk about, but what is the unit capacity for iCombi, iVario, iHexagon overall? And how will that develop over the next 3 years?

Yes, we have 120,000 units capacity in Landsberg. We can easily add another 30,000 with -- doubling the last expansion we did in Landsberg, so there is space left. Capacity increase presumably will start in the next years. We have 25,000 units capacity in Wittenheim. Also there, we can double that and then add another 25,000 in the third period. Additionally, info on other questions, units are up 12% with the iVario and 6% in the iCombi.

Okay. Great. And that would be another question. So iCombi, iHexagon and iVario, we're not talking about -- what's the average price per model? Can you give us that in 2025? That's probably a question for you, Jorg.

Yes. Well, we have EUR 9,000 for iCombi for the starting model and EUR 13,000 for an iVario. So that is the average selling price overall. The smaller, as you know, let's say, the iCombi starts from EUR 7,000 to EUR 8,000 and then goes up to EUR 30,000. And the same is the variety we do have for the iVario.

Okay. Great. Looking at -- and we've talked about this as well. So this is a little redundant, but in case you want to add any color. Question is regarding the Middle East and the potential impact on your sales, customer behavior or your supply chain?

Yes. I think also, Peter, you mentioned it earlier. So our staff right now, they are working from their home office. The normal sales process in Dubai, we have basically in Dubai. We are also in the course of setting up a warehouse, a local warehouse in Dubai, that process is stopped so far because basically, the ships are coming there. The total impact, it's around 3% of our sales, so for the overall company, we do not expect a real major impact.

Great. Following up on logistics and basically the Iran war as well. Do you produce mostly in Europe and then ship overseas, I assume? And how much would be transport costs of the overall cost of the end product in the U.S. Can you give us a feeling there or in other overseas markets?

Yes, the overall -- so the cost per unit is around 3% to 3.5% of sales.

Okay. Good. And last but not least, do you see any hesitation of gastronomy customers to replace their ovens or buy new ones or rather wait due to the Iran war and its potential impact on inflationary costs? Do you see an acceleration of electric ovens versus gas ovens?

No, we don't see any major trend right now, as we said earlier, so the markets, they are quite stable. U.S. market, 50% gas, electric, that is quite stable over the years.

Great. I don't have any more questions for you, and I appreciate you being so forthright and answering them quite well. Once again, congratulations on your fiscal year. All the best for 2026. Congratulations on your granddaughter. That's good news as well. And thank you for your time and your insights. And of course, thanks to everybody else who participated and also contributed very interesting questions. All the best. Have a great afternoon. Thank you.

Thank you very much.

Thank you very much.

Bye-bye.

Bye-bye.

Hello, everybody. Can you hear me? Is everything okay? Maybe you can give me a sign. Okay. Perfect. Thank you very much. So good afternoon, good morning or good evening to everyone wherever you are in this world. I thank you for participating in this IR talk today and a very warm welcome to everybody. First of all, some housekeeping rules again. So I will start with a quick summary of the last week's results again, and then we can go over to Q&A session. [Operator Instructions]. And one hint, this call will not be recorded by us.

So first of all, let me summarize the most important points of 9M 2025 given last week in the earnings call. So with sales revenues in the 9-month period of around EUR 918 million, we grew by 5%. And in Q3 alone, we grew even by 6% to EUR 312 million. FX turned negative for us since approximately Q3. And adjusted for these effects, growth rates would even be at around 6% to 7% for the 9-month period and for Q2 and Q3 between 8% and 9%, respectively. So this is something I want to highlight. It was the second consecutive quarter now again with organic growth rates within our long-term CAGR ranges of 8% to 9%.

So this means the general business situation is looking very good. Just FX is hindering us from growing sales revenues even at a higher rate. And also, the order situation is looking promising so that we are confident to reach our sales guidance for fiscal year '25 at a growth rate in the mid-single-digit range, so at around 5%. Margin-wise, we need to mention the 2 biggest impacts, of course, and that is the U.S. tariffs and strong euro or the other way around, the weakness of our most relevant currencies as already commented on the sales development earlier. And as we already saw it in Q2, there was, again, a significant margin impact at around 120 basis points on the EBIT margin just for Q3. So this was again the same magnitude that we saw in Q2.

And so for 9 months period, for the 9 months EBIT, this means a negative impact of around 80 basis points on the EBIT margin. And status now, we expect that the impact will continue in Q4, putting some headwinds for us on the margin guidance. On the other hand, of course, in the top line, we will be able to compensate with good business development. But on the bottom line, there will still stay some negative margin impact coming out of this topic. And on the tariff situation, we are facing additional costs, as already said, for the import tariffs to the U.S. that we estimate now at around EUR 11 million for fiscal year '25. EUR 6 million of that already were in the 9-month period and the remainder, so approximately EUR 5 million will be in Q4.

So the combination of all these facts led us to make the guidance more concrete in August this year for a guidance -- margin guidance in the magnitude of 25% to 26%. And looking at the business development so far and the expected developments we have now after the 9-month period, we can confirm this guidance. So this means total guidance would be then we grow in the mid-single-digit area, and we realize a margin of 25% to 26%. Of course, we cannot give you a guidance for next year, but one thing that we already mentioned last week in the earnings call is the expected extra cost for U.S. tariffs, and I can repeat that here. This is around EUR 25 million, so total cost for '26 or EUR 13 million more than in '25, resulting in a margin drag of around 1 percentage point for 2026 compared to 2025.

And of course, I know that you would be now keen on hearing more about our reactions on these additional costs. But as already said last week in the call, and there is no change until now, there is no decision yet on pricing that we can communicate now. And first of all, now, so those who know us who follow us for a longer period of time know it in the context of our budgeting where we are in now that the first step would be to evaluate saving measures in order to counteract higher costs and then afterwards derive maybe a potential pricing action. But that is all that we can say now about that topic.

And yes, it was very short. I think there's not a lot more to say from my side now. And with that, I open -- or I'm open for questions. Let me just wait one -- we have some problems with getting the people on the call. Lars, did it now work? We just did a short reminder for last week, and now we are at the point where we start in the Q&A. I think you are right.

Okay. Perfect. Yes, I struggled to get on the call indeed.

We have some problems. There's another guy who is still -- it's running, but I don't know why it does not work. Let's see now I think it's on. I think Nicolas, I think you -- it worked now? Okay. So guys, also for Nicolas, we did just a short update on last week. There was nothing new. And now we can go over to Q&A. I just -- yes, I think maybe you might answer -- ask the one or the other question maybe we already had, but that's okay. So who wants to start? Lars, you want to start?

Any update on U.S. pricing? Have you taken a decision in the meantime?

I just repeat my second last sentence, I think there is no update on last week's call information. So I said we are now in the budgeting phase. And of course, there, we then are evaluating all the savings measures that are possible. And then later on, there will be a decision on pricing.

Sorry, can you hear me? I can't -- I'm still stuck in the waiting room, but I can hear you. I'm not sure you can hear me.

We can hear you now, Nicolas.

Okay. Can I ask you a question? Sorry for not raising my hand because I don't have the functionality where my screen is. But could I maybe just on the U.S. because we just talked about the U.S., the 4% growth, that's obviously a significant slowdown. And I just wanted to understand that a bit better. I know you had a tough comp, but is that the only explanation for that deceleration because it's especially -- I think it's from 10% to 4% sequentially.

Yes, it is. So there is -- when we look on the run rate, we are doing quite well, meaning last year, Q3 was by far the strongest quarter we had in the North American territory. I can just repeat it, we had around EUR 70 million in Q2 and Q4, and we had about EUR 77 million in Q3 last year. And this year, Q3 was okay, but it was a little bit less and adjusted for FX, as you said, it was around 4% growth. And when you look into the 9-month figures, we grew by 10% organically and 6% after FX. So meaning also here a little bit of negative impact, but Q4 should be then again, a more normal quarter. Is it okay? Lars again.

China, you said that production will start later this year. Sales will start early next year. Shall we expect any additional ramp-up costs? And would you be willing to share with us when do you expect production in China to be breakeven? And is it possible to compare the gross margin or the profitability contribution? I assume production in China is cheaper. Selling prices are also lower. But when it comes to profitability contribution, are there -- is there any information you're willing to share with us?

Yes, of course, of course. So there is -- we are in plan, as also said in the call last week, start of production can be now, I think, in December and the start of selling will be in March after the Chinese New Year. There will not be a significant amount of additional costs now, would you say, ramp-up costs. So I think we are through that in the meantime. And the margin contribution, at first, it will be presumably negative. That's for sure in the first quarters, years, depending on the development, of course. In the longer term, the plan is to have it approximately on group level. So meaning there is a lower price, but also there is lower production costs. And all in all, this should match that we come out with no margin dilution in the end.

Can I just ask a question on China?

Yes, you can.

Yes. Just when you say no significant ramp-up costs, so the cost base, as we've seen it in Q3, especially kind of that going forward is what we should expect, including the China model commercialization. And can I just ask one more on OpEx?

Yes, of course, of course, you can.

And again sorry, I can't raise my hand. I am still stuck in this initial screen. But R&D was quite high. Can you maybe elaborate a bit on what happened there?

Yes. On the one hand, yes, you know that R&D is one of our major, let's say, topics we are investing in, in order to keep our innovative level high. And I think we brought out a lot of innovations in the last time. We are working a lot of the time on, let's say, connectivity, intelligence, software topics. So the major part of the people we hire is software engineers in the meantime. And on the other hand, so this means we have more people with higher salaries. And of course, everybody is producing a cost then in his job. So from that point of view, it's pure capacity aspect.

And the other thing is -- but it is fee level, but it's maybe not a bit we do some with the Wittenheim with the capitalization of the Wittenheim facility. And then, of course, we have some cost allocation systems. We did some changes here with the finalization of the Wittenheim facility. And with that, there was a little bit higher amount that is allocated to R&D, also contributing a few percentage points here. But all over, it's really a capacity point of view, investing more into the future developments. Nicolas, all good?

Yes, thank you. Perfect.

Yes, can you hear me?

Yes, I can hear you. Perfect.

Yes. So obviously, Europe and Germany were pretty good. I was wondering if you could expand on that as to why that was and how that sort of functions into appliances versus aftersales.

Yes. So I think we announced that Germany was all over very strong. Two major reasons why it was maybe even a little bit stronger was we had a quite weak previous year quarter. And on the other hand, we had good business in the aftersales market this quarter, which can come in waves and go down in the next quarter again. We would say, of course, a growth rate of 18% for a German market is something you would not expect, of course, in the longer term, even the 5% growth rate for the German market after 9 months is really ambitious for such a highly penetrated market.

But sometimes it comes in waves. We had discussions. I was in the conference yesterday, discussions quite often on that. Sometimes -- just let me circle back to your other questions, and then we have explanation for that maybe.

Also in Europe, we had strong development in most of the countries. There was no country that was really very weak. We had some very strong countries like the U.K., for example, or Italy, but there was growth in all the major countries. And if you ask then what is the reason? Is that the one reason? We can't say no. It's really a broad development. And sometimes you see it in waves, you have weaker years where you maybe, for example, you invest in new sales guys. And of course, they are not efficient at the very first day, it takes 6, 12 months, then they are getting efficient in the market, then they meet more customers, they visit the customers invite them to cooking live demonstration. These figures are going up and sometimes later, these customers buy a unit.

But you cannot say whether the hiring new people will be showing up in higher sales figures in 1 year or in 2 years or 6 months. This is something we need to wait for and depends on the customers' plans. And that's why we say it's very, very important to continuously develop the sales organizations to increase the sales teams in a structured way so that we can fuel this growth story in the long-term view. But in a short-term view in single quarters, you never can say will this be that figure or that figure. So this is quite open.

So from that point of view, that's a good news. So there is not the one reason. So like, for example, Asia last year with a big order and when the order is gone, you have a weak following year. So here, I think the basis for the growth is strong, and that's why we are confident that we will continue on this path also in the coming quarters. But whether -- again, back, whether this is the 10% for Europe or just, let's say, 5%, 6%, which we deem as something sensible to assume in the mid-single-digit area for such a market with comparably high penetration levels, this is the other thing. It could be in this range. And Lars again [ we could have you ] on the call.

I was shying away, but maybe -- I mean, please help me understand again why it's taking management so long to decide on the U.S. pricing. I mean you mentioned EUR 25 million of tariff headwinds for next year. Let's assume no major additional headwind from the U.S. dollar staying on the current level. You will have personnel costs increased -- personnel costs to EUR 70 million to EUR 80 million. So 2%, I don't know, EUR 5.5 million, EUR 6 million. That already brings us to a EUR 30 million headwind for next year, which is close to 10% of your EBIT. I mean, I would say it's a no-brainer that you need to increase prices significantly in order to secure the current margin level. What am I missing?

Yes, I would say as I said before, maybe this was before you were able to join the call. So we are in the middle of the budgeting process right now where, of course, there is a lot of cost discussions. And the first step at RATIONAL is always to start with efficiency measures, try to improve the efficiency to save costs. And we will see or we will get the results, I would say, in the coming weeks, and we have maybe already first figures there, and then there will be a decision on do we need additional pricing measures to come in a range, in a margin range that we would want to see in the end that we would accept.

And so from that point of view, difficult to say, yes, why is that? I think we are not in a rush because business is developing well. Margins are on a good level. And I think there is no huge pressure for us now to react very short term. But you're correct, sooner or later, there will be a decision, and we will then announce it as soon as possible. Sorry for not having a better answer for you.

Can I maybe just ask -- sorry, I can't see who raised his hand. So go ahead. I'll just put me in the queue maybe.

In the end it's only you and -- you and me, Nicolas. So join us whenever you like, you're not disturbing anyone.

Okay. Sorry, I can't even see who is there. Okay, good.

We would tell you.

All right. Well, then maybe can I just follow up on that on the U.S. tariff. So you said EUR 24 million, EUR 25 million. My understanding, that is EUR 14 million incremental. Is that correct? Because you already have EUR 11 million this year? Or is it another EUR 24 million?

No, EUR 13 million incremental. Yes. And that's also the same -- this was what I was saying in my first initial statement before you were able to join. It's EUR 24 million and it means plus EUR 13 million compared to EUR 25 million, meaning an effect of around 1 percentage point compared to '25.

Okay. And that impact assumes no pricing as we've just discussed and no mitigating action? Or is there already some mitigating action that's netted off this.

No. Excluding all what you said, yes.

But you don't have any visibility yet on what mitigating could do to offset this?

Not yet, no. I think this will be too early to say that, but I think by the end of the year or early next year, we will have the complete information on that. And I would assume that the decision would be made earlier before we have the final picture out of the planning. And then we say, okay, now we do an additional potential pricing action. So I would assume this would be available earlier. But I cannot tell you exactly when.

Okay. Can I ask maybe just one final question on this pricing and U.S. tariff thing. Is your thinking which as a long-term investor, I would kind of go along the same lines. Is your thinking a bit more let the others raise prices so we can take market share?

This is maybe one point that's important here to say, okay, if we would not increase prices at all, just a scenario right now, not an outlook, would mean, of course, in relative terms that we would get more attractive for our customers for sure, and maybe this would also help us to improve sales growth. On the other hand, I got -- I can share one statement of an analyst with you. He said he would wish that we would increase prices by 4% because this would not be enough to, let's say, annoy customers and hinders them from investing because it's not too much, but it would show some strength that we would be able to increase prices. So this would be a magnitude that he would rather see positive than not increasing prices at all.

From that point of view, I think there will be arguments for every action that we take, pros and cons. But in the end, I think it's a management decision, and I hope, as you do, we get it soon.

Yes. Just following, Nicolas, I'm a bit confused now. So U.S. tariff impact, EUR 13 million more next year than this year. So EUR 11 million, EUR 12 million this year, EUR 25 million next year, so a total sum of at least EUR 37 million.

No, no. 2024...

Is the total sum.

It's the total. This will be EUR 11 million, meaning EUR 30 million more.

Okay. Understood. And although not necessarily relevant at this stage, but just for the sentiment and the outlook, the iHexagon unchanged outlook, right, breakeven in 2 to 3 years' time, slowly developing.

As said, very difficult to say. I think to repeat what we maybe had in a few calls before is there is really long-term projects with our customers. There was a statement from one big hotel chain. They say for them, it takes around 5 to 7 years until they decide on a bigger rollout with these units. And this is sort of confirming our experience we make with big customers. And again, I want to quote this KFC experience that we had in the early 2000s. There, we saw it started in '97 or so the project, the first bigger orders came in 2002 and 2004, there was a bigger rollout. So this is confirming a little bit this 5- to 7-year approach in these big customer groups because there's a lot of testing, a lot of pilot phases in there.

And that's why we think for us, it's now important to get such stories like with Tottenham Hotspurs, which can show the potential customers have. And it is like we always said with the iVario, it might take a third -- a second or a third look until a customer decides, okay, I try one. And here, we are in a completely new product category, which is not comparable with the new generation of an existing product. So from that point of view, we take the time. And whether it's 2 years, 3 years or 5 years, I can -- I would say nobody can really say right now.

Maybe ask another question on the top line. So the U.S. deceleration on a tough comp. You just mentioned or we just discussed Europe, where you see a normalization to mid-single digit. And then Asia will probably have a tough Q4. I think that's what you mentioned in the call, was it last week or the week before. And so I'm just -- can you give us the building blocks on how you will get back to the high single-digit growth? Because my understanding from the Q3 call was that you do expect a return to high single-digit growth next year. maybe I misunderstood this.

Yes. Yes, that's correct. So meaning that we come to an organic growth level of, let's say, yes, 7%, 8%, 9% is something that should be realistic. I think we have now 2 quarters in a row where we were able to do this. And I think the building block is indeed that we see in our figures, in our salespeople development, in our activity and development, meaning customer visits, cooking live participants, et cetera, that there is more customer contacts. And in the end, the organic growth rates are at levels of -- in this 7%, 8%, 9% area. From that point of view, this makes us confident when we go on doing this in a successful way that we are able to get the people to onboard them properly that we are able to also translate this into sales figures. And this is not depending on one certain region. This mechanic is working everywhere more or less in the same way.

Of course, in more penetrated regions, it's maybe more important to visit the people to remind them of what's going on because they know the technology. And in less penetrated markets, you need to get them in the cooking live demonstrations to show this new technology to people that they understand all the advantages. I think this is maybe a little bit of difference. But I think customer contact is key to the future sales development. And from that point of view, we are quite confident. And region-wise, it's still the same story, over proportional growth, double digit in the overseas markets and mid-single digit in Europe and in Germany, maybe rather in the lower single-digit area in total coming out at approximately 7%, 8%, 9%. And what will be then with the FX development next year, which we see this year very negative. So this is another thing we can maybe not control in the same way.

But of course, we see that there might be some negative impact next year as well. Just out of the development of this year could be a little bit a negative headwind. But on an organic way, what we can control ourselves, we are confident to go back to that track that we had before the crisis.

Okay. Understood. So you would expect Americas to accelerate again.

Absolutely. And organically, Americas or North America is at some 10% growth. So that's -- it's maybe at the lower end of the range we would expect, but it's more or less in line with what we would expect. So is there any more questions? I don't see any more questions.

So then I thank you for participating. And if there are questions coming up afterwards, please don't be shy and either write an e-mail or give me a call. So this is well accepted, of course. So then take care. And I'm happy to see some of you next week in Wittenheim and the others then next year. So we will presumably announce preliminary figures early February, I think 5th or 6th or so and then have the press conference earnings call and the disclosure of the annual report on the 19th of March. So with that...

Great. Thank you very much.

Bye-bye. Thank you very much and take care.

Thanks, Stefan.

Thank you. Bye-bye.

Bye.