Welcome, and thank you for joining Exor's half year 2026 results conference call. Please note that the presentation materials and the related press release are available for download on Exor's website, www.exor.com, under the Investors and Media Financial Results section. Any forward-looking statements made during this call are covered by the Safe Harbor statement included in the presentation material. As a reminder, all participants are in a listen-only mode. Later, there will be a brief question- and- answer session. Please note that this conference is being recorded. At this time, I would like to turn the conference over to Exor's Chief Financial Officer, Guido de Boer. Sir, you may begin.
Thank you for opening this call, and welcome all to the half year 2026 results call for Exor. Two main highlights that we would like to present to you today. We announced last year that we would progress with simplifying our portfolio, and we've progressed at speed with doing that. The most sizable one, Iveco, you've all followed closely, where earlier in the half year, the sale of the defense business completed to Leonardo, and also a few weeks ago, Cassa formally launched its tender offer for Iveco, with closing to happen in two months.
Also, during the period, we completed the divestments of GEDI, Lifenet and NUO, and I'm pleased to tell you that the past days, we signed an agreement to sell our stake in Welltec, where we've owned the company through a business cycle, managing to run that business in a very well way, with a price which will be substantially in line with what we put in our fair value balance sheet, which returned a MOIC of 2.4 x, and we expect that to close in the first half of 2025. That leaves us in an extremely strong position in turbulent times, and leaves us in a good position to benefit from those turbulent times with a balance sheet that is extremely solid with EUR 4 billion of deployable cash approximately. To give you the bridge of that, we started the year of EUR 1.4 billion of cash.
The proceeds from these divestments and some other divestments like reinsurance vehicles and distributions from venture arm deliver around EUR 2.7 billion of proceeds. Then with some net cash inflow from dividends and some capital calls we made for Lingotto, we'll end up with approximately EUR 4 billion of cash, of which we'll use EUR 500 million in the buyback to execute in six months. We'll speak a bit further about that later in the call. So moving on to the key figures. During the period, our NAV declined by EUR 1.2 billion. We'll go into the detailed sources of changes from. While our loan to value strengthened quite a bit, obviously with the increase in cash position. NAV per share fundamentally moved in line with our NAV as we did not do buyback in the period. Our total shareholder return was below that because of the widening of this.
Composition of our portfolio changed on a few important items. Ferrari strengthened a bit from 32% to 34%. An important mover was CNH as well with a very strong performance in the period, moved from 8% to 10%. Also cash up to 6% during the period. If we then move to the breakdown of the change in NAV. There is a lot of numbers on this slide. The key one that explains the performance in this period is the change in value by listed company. We will break down all the other buckets in detail. We want to be extremely transparent and show you all the levers of performance. We will dive into that a bit further, but all of them left in the period, an increase from cash and cash equivalents from EUR 1.4 billion to EUR 2.2 billion.
As mentioned from EUR 300 million of investments, largely behind the commitment of Lingotto, around EUR 500 million of disposals, the dividend we did, and in other changes, the EUR 676 million is the dividend inflow that we had, less expenses. We then move to the core bucket of investments that we have our list of companies. There you see the key driver of our performance was a strong decline in the share price of Stellantis during the period. The other three big companies almost performed well with a notable mention for CNH. Iveco seems like a weak performer here. I would like to note that they distributed a EUR 427 million of special dividend following the divestment of Leonardo. For TSR, they showed a strong green performance. Juventus and Clarivate were weak during the period.
Via Transportation, which recently IPO'd, and they showed similar trends of many U.S. tech companies that IPO and weakened, and have for now since rebounded, and its underlying strong results. We then move on to unlisted companies. We disposed in the period, GEDI and NUO, and after the period, we also sold Lifenet and Welltec, as I just mentioned. In total, around EUR 900 million of reduction of these unlisted companies and shifting more to a listed portfolio. The change in value, here you see Institut Mérieux. We will speak later also about the direct holding in bioMérieux, because the change in value of Institut Mérieux is largely driven changes of the listed bioMérieux. Then moving to Lingotto and others. The Intersection fund declined by EUR 317 million, approximately. You might recall that last year they went up EUR 1.2 billion.
This is a logical volatility that lies in the market and very confident given that they have never had a down year before, and they want to drive to positive in these months. Lingotto Horizon was the good positive surprise, where they have one investment in their portfolio, which saw a unicorn round, and because we are one of the early investors, it shows a very nice uplift there. Value debt portfolio and the others moved steadily during the period. The investments we did were existing commitments for Horizon, Innovation and Mosaic, and we invested in a very promising new hedge fund talent that is starting a new hedge fund with a capital of EUR 200 million that deployed in this period. Then we have the bucket of other assets, which before, at the start of the period, amounted to EUR 2.3 billion.
We have been disposing quite a bit of assets in that category as well, and that is an ongoing process we plan to do. Key proceeds in the funds managed by third- parties were EUR 55 million of reinsurance vehicles, still left over from the PartnerRe disposal, and EUR 38 million of distributions from Ora Global, the former Exor Ventures arm. Other assets were loans extended to GEDI, and as part of the sale of GEDI, these were also. On the changes in value, also on the venture capital arm, they have made investments in some of the early AI companies, both in AI businesses themselves as well as in infrastructure. These all look to be unicorn investments, and that is driving a strong upward revision of the valuation of Ora Global. Listed companies, down by EUR 237 million.
EUR 180 million of that is related to GEDI Media and also Forvia on the back of the weakness in automotive, like I mentioned. Stellantis was down [EUR 2 billion] , which explains the grand majority of that change. That is for [Non-English content] of the performance of our portfolio, and gladly answering further questions in full. As I mentioned, the change in cash and cash equivalents, the breakdown I showed you at a high level before, EUR 861 million of dividends. We received a bit more of dividends, but we chose to take half of the dividend of Philips in shares. That you will not see here in the cash and cash equivalents, but that explains the bridge between dividends and dividend actually received. The disposals you see here that we just mentioned, investment and shareholder distributions equal dividends in this period.
Given our sizable cash position, we also repaid one of our private placements, just to make sure we treat our interest returns as efficiently as possible, and these borrowings were carrying a higher interest rate than our cash position. That is why we repaid debt, ending with EUR 2.2 billion of cash. On the debt side not much to report as I like it, being prudent on our debt position. So we have a debt position of EUR 3.7 billion, in line with what we had last year. Maybe see a bit of movement in other financial liabilities, EUR 140 million. That is just the timing of an FX transaction we did, which started at the end of the period and completed on the first day of July. That is an accounting entry.
The bottom line number is EUR 3.7 billion. We have no redemptions anymore in 2026, nor in 2027.
In these turbulent times on the debt and capital markets, happy that fully funded on that side and first redemption to follow in 2028 with a very well spread out maturity profile for the coming next 12 years. That said on the debt side, let me now turn to the capital allocation decisions we took in the board yesterday, doing a EUR 500 million on market buyback program. We will execute that in the next six months. So you will see also in the announcement that we are very explicit that both because the shares trade at a substantial discount to our NAV and do not reflect our assessment of the intrinsic value of our portfolio, we made this decision. We also said before we do this because it is at a substantial discount as our NAV, because we feel that this is a good resource allocation.
Investing at our portfolio, which we like, at half of the cost is an investment that makes a lot of sense. We also chose to make the statement a bit stronger because I think we are actually in a triple whammy situation of the discount is at a very high level. At 56% is a long time that we reached that. Our companies are at depressed levels, and we have a cash position that is well utilized now. We feel this is part of our toolbox, but also a part of our ongoing toolbox that we continuously evaluate to do. It is not an opportunistic transaction. We also chose not to do this as a tender offer, but on-market program, which has started today, and which will continue until the full- year results in six months.
It is important for us because we are committed to driving NAV per share growth as we have always done, outperforming both on an absolute and relative basis. As I mentioned, buybacks are and will remain a critical part of our capital allocation. With those closing remarks, I would love to hand it over to the Q&A.
Thank you. We will now begin the question- and- answer session. If you have a question, please press star then one and one on your touch tone phone. Once again, if you have a question, please press star then one and one on your touch tone phone. Please stand by while we compile the Q&A queue. Thank you. We will now take the first question. Please stand by. First question is from Alberto Villa from Intermonte. Please go ahead.
Hi. Thanks for taking my questions. I have actually two. One is related to the situation at Stellantis. There is a plan and a recovery expected in the fourth quarter and the coming years, but the situation in terms of cash of the company has deteriorated. I was wondering if there is a scenario in which Stellantis might need to raise cash. What is the position of Exor as a shareholder on that? I have read there is a lot of commitment in the report on some investments like Ferrari and so on. I was wondering, what is the commitment on Stellantis? The second question is on the performance of Lingotto. Was very positive last year, not so positive this year. I was wondering if there is any specific reason behind that. Thank you very much.
All right. Thanks, Alberto, for these good questions. On Stellantis, we fully endorse the plan that has been announced by the management, and we are very confident in their execution of it. It's an uncertain market. How they will do on their cash position and their capital increase, I am not aware of any those plans, and honestly, also not really a question I can answer. These are more topics to raise to Stellantis management. So no view on these topics. Lingotto, I think no particular reason. The performance last year was very strong on the back of the hedge fund. Hedge funds have volatility, and we are very happy as a long-term investor to embrace volatility if the long-term performance is good. So this fund has returns since inception, I think an IRR of 24%, so calculate those numbers since 2018. A stellar performance.
If there is a blip in one month, there's no concern about. This is just the volatility that's inherent with such a strategy. So for Intersection, that's just par for the course for the type of strategy that it is. I was very encouraged to see the strong performance of Horizon. Horizon is a fund that invests in private investments. It's now fully invested in monetization period. So that's usually the moment where you start seeing the large value step-ups. And seeing our investors at Lingotto delivering on this is very encouraging. So I hope this answers your questions, Alberto.
Okay. Thank you. If I can, an additional one. You performed various divestments in the first of 2026 and also afterwards. I was wondering if there is any opportunity for further divestments between your listed and unlisted companies. Thank you.
Yeah, we are always evaluating our portfolio, and I mentioned that in previous calls. We always look at all of our investments. We are a long-term investor, so we are not going to divest all the time. But we always look at, are we the best owner of these businesses for the long term, or is there a good opportunity comes around? So that's always the case, and I hope you understand I give a generic answer rather than a specific one. But as you have seen, we have been very action-oriented.
Thank you.
All right. Thank you.
Thank you. We will now take our next question. This is from Jon Pérez from Kepler Cheuvreux. Please go ahead.
Hi. Jon Pérez from Kepler Cheuvreux. Thank you for the presentation. Just one question from me on portfolio construction in the context of the next investment. The press release mentioned about EUR 4 billion of cash ready to be deployed. In the past, I think I recall the sectors that were mentioned were healthcare, luxury, and tech. I would be keen to hear about how you think of portfolio construction, considering the rest of the current portfolio and whether there are specific thematics that you would be happy to get exposure to with your next investment, how you think about a long-term moat in the current environment, and whether there are specific risk factors that you would like to avoid. Any clue on the timeline would be welcome as well. Thank you.
Thank you, Jon, for these thoughtful questions. Portfolio construction is obviously a critical part of what we do. During PartnerRe disposal, we said these are the three sectors. They are still sectors that we like a lot and where we have a lot of domain expertise, and where we know where the hidden gems are hidden. But it does not mean that we will only invest in these sectors. What we are primarily looking at is a large list of companies in which we can acquire a shareholding of 15%-20%, or an investment of at least EUR 2 billion. EUR 2 billion being approximately 5% of our books as a general. The thinking of that is we want to have the right level of diversification in our portfolio. At 5%, an investment makes an impact, so that is why we have a lower threshold of EUR 2 billion for each investment.
But it is largely in listed companies where we have then an influence similar as we have in our other listed companies. It is what can we contribute as a shareholder? Being an active shareholder where we can add value, either in turbulent times, to offer long-term stability to the company or in companies that go very well, but need a shareholder also to keep the management sharp and driving long-term growth. That is overall what we look at. Then we look at individual sectors where there is structural tailwinds, and within those sectors, companies that have a right to win and where there is also a fit with the ownership structure that we do and the way we drive value creation with this. That, in general, our philosophy around searching for the next large opportunity. We are patient shareholders, but we are also patient investors.
As I mentioned in my opening, these are quite turbulent times, and turbulent times bring opportunities for the patient. We are not in a rush to deploy. It is about finding the right company at the right price, at the right time. I will not give any timing on when we at Exor make the next investment. Obviously, sooner rather than later. Obviously, we want to deploy capital, but we are patient to wait for the right company. I hope that answered your questions, Jon.
Yes. Thank you very much.
Thank you.
Thank you. We will now take our next question. Please stand by. Next question is from Filippe Goossens from Degroof Petercam. Please go ahead.
Yes. Good afternoon, Guido. Thanks for taking my questions. I actually have two today, if I may. The first one, maybe building on the previous question in terms of portfolio composition, my question is specifically with regard to concentration risk. Today, if we look at Ferrari, it is about 39% of your GAV. So it is your largest position. You have always positioned the Ferrari investment, and I fully concur with that, as a luxury brand. It is not a car manufacturer, which is good today because we all know the challenges that the car industry is facing. So it is a luxury brand that has performed very well for you.
But at 38%, I wonder how you feel about that 38%, because if you look at some other players in the luxury brand segment today, LVMH, Hermès, if we had said at the beginning of the year, these companies could be down almost 40% in market cap year-to- date, we would never have believed it. So it is a great brand. It is a luxury brand, but it is 38% of your portfolio. How do you think about that? If you could kind of walk us through that, in terms of how you evaluate that at the board meetings. I just would love to understand that a little bit more, if you could help me here.
With pleasure. Great. Did you have another question, or was this
Yes. The second question, Guido. In the letter from your Chairman or CEO, John Elkann , was a reference made to an approval reached with Philips, which would open the way to a potential increase in your stakeholding. If you maybe can just elaborate a little bit on that. I would imagine that would be within the constraints of what you just shared before, meaning large listed companies between 15% and 20%. Does it fit within that context that we should look at that potential increase in the Philips stake?
Yeah. No, I'll comment on that. Maybe to take that one. I think the renewal of the partnership with Philips is, I think, a testament to our investment working well and our partnership with the company working well, and thus adding value to the governance of Philips. That has been evidenced also with the company opening up to increase our stake further. Previously, we had a limit of 20%, but now increased to 22%. That doesn't mean that there is any action now taken to increase that or that it's imminent, but we have the opportunity, and we see that as a vote of trust from Philips that they value our ownership. I would say that is the key takeaway from that investment.
Okay. Guido, that would happen in the form of open market purchases if you were to decide to increase that, or
I do not-
would you look at the block trade or Yeah. Okay.
We have not decided anything on if and when that will happen. But first, if.
Okay.
When we do it, we use whatever tool we need. But it's not off the table.
Okay. Fair enough. Thank you.
Ferrari, I think it's a very good question. To repeat what I said following the block trade that we did on Ferrari at EUR 3 billion a year and a half ago. At that time, the concentration of Ferrari was reaching 50%. At 50%, and also the multiples the company was trading, exactly what you were saying is a sizable risk. If half of our portfolio traded this value and there's a potential for the share price to decline such a level, it is prudent to reduce the concentration. That's what we've done at the time, and these were the considerations. At this moment, the multiple at which Ferrari trades is significantly below the multiple it was trading at when we did that transaction.
The 37% or 39% of GAV that it represents now is still far below the 50% and also the multiple is not at the same level. It's not the same situation, but we always look at our portfolio from what is the upside, but also obviously the downside.
Yeah. Very good. Thanks for that clarification, Guido. Maybe just a quick follow-on, if I may. In your search for attractive additional investment opportunities as you build out your portfolio, if the right transaction were to present itself and you don't have sufficient liquidity to do that transaction, would you be willing to consider monetizing part of your Ferrari investment so that you would basically kill two birds with one stone? One, raise the funds needed to make a very accretive transaction, and secondly, to reduce the concentration risk in the portfolio.
We are an investor, so we do what every investor does. If we see an attractive opportunity to invest in, we will do that, and then we will review our sources of funding. We first of all, look, obviously, if we have cash or still headroom on the debt side. If we do not, and we really like the new opportunity more than the least attractive one at that moment in our portfolio, we will look to monetize something in our portfolio. That is an approach that is exactly similar as any investor does. We are not different there.
Okay. Fair enough. Thank you so much, Guido. Very helpful.
But it is not that Ferrari is not on the list. We think Ferrari is an amazing company. We are very happy.
Okay. I see that. I agree with you. Okay. Thank you so much, Guido.
Thank you.
Thank you. As a reminder, if you would like to ask a question, please press star one and one on your touch-tone phone. We will now take the next question. This is from the line of Martino De Ambroggi from Equita. Please go ahead.
Thank you. Good afternoon, Guido. The first is just a very quick clarification. The firepower of EUR 4 billion, this does not include the buyback, which is on top?
The firepower is EUR 4 billion, and from that you would deduct EUR 500 million for buyback. So after buyback, there is EUR 3.5 billion.
Okay. It is EUR 3.5 billion.
By then we are at the start of the year, so then we will start getting dividend inflows again. That is basically the capital. So EUR 1.4 billion current cash, EUR 2.7 billion of expected cash inflows from disposals, around EUR 300 million of net free cash flow and EUR 300 million of commitments gets you to around EUR 4 billion, less EUR 500 million is EUR 3.5 billion firepower.
Okay. The second is a follow-up on what you commented in the past. So you are looking primarily, but not only, to healthcare, luxury, and tech. In luxury, in your previous calls, you mentioned it is difficult to find something interesting. Are these three sectors your main priority, or as you mentioned, we are open to other opportunities, but as a secondary option or always looking at these three?
No, we are very open to other sectors, and we are also actively considering other sectors, but with the same structural tailwinds, less correlated to the current part of our portfolio, to also make sure we have diversification in business from a sector-wise, and then finding companies that have opportunities for great returns within those sectors. So we are not bound with those sectors at all, but we do have a great network and understanding of those. But we are definitely not limiting ourselves.
Okay. Looking back in the last 18 months, you had already had a very good firepower. Nothing happened. I remember you mentioned prudent and patient approach and so on, but is it because there is a lack of interesting opportunity because the prices are too high? Because you need better visibility on some of your assets, as you mentioned in the previous question, was Stellantis the question mark for a needed eventual cash injection? Just to know what happened in the last 18 months, if you bid for something that didn't materialize, or there is lack of serious opportunities?
We did not miss any transactions. We look at Berkshire Hathaway and their cash position. Our firepower in that sense is, as a percentage, much smaller. They're also very patient. I think this is a time where there will be many opportunities. It's an active choice of us not to deploy now. We have, obviously, potential targets. We continue to look for others, but we will remain very disciplined in putting our money to work, because we invest for the long term. We try to find a good opportunity at a good price to move more. I hope this is clear, Martino.
Yeah. The last one on Lingotto. Is there any update on the strategy in terms of asset under management, third parties contributions, and these kind of things?
No update there in the half year. As I mentioned, we're very happy with the performance. Principally, it's great that Lingotto grows assets under management because it gives it some scale. As you might remember, because you've been around Exor for a long time, when we announced the start of Lingotto, we invest for returns. This is not about assets under management from third parties and creating management fee income. We want to make investment returns, and that's where Lingotto has been a very strong contributor to our overall returns. As we always do, in the full- year, you'll see more information on the overall size of Lingotto.
Okay. Thank you, Guido.
All right. Thank you, Martino.
Thank you. There are no further questions at this time, so I will now hand the conference back to Guido de Boer for any closing comments.
Nothing from my side, except for thanking you for being in this call and making the time, and looking forward to read about your views in the coming issue of Key reports. Thank you all, and please, you know where to find myself, Mike, and Niccolo in case of any questions. For the press side, Suzanne. Thank you very much and have a nice day. Bye-bye.
Thank you, ladies and gentlemen, this concludes today's conference. Thank you for participating, and you may now disconnect.