Good afternoon. This is the conference operator. Welcome, and thank you for joining the Indel B fiscal year 2025 financial presentation web call. All participants are in listen-only mode, and after the presentation, there will be a Q&A session. At this time, I would like to turn the conference over to Ms. Elisabetta Benazzi, Investor Relator of Indel B. Please go ahead, madam.
Thank you. Good afternoon, everybody, and thank you for joining our call today on Indel B fiscal year 2025 financial results. Before starting the presentation, I need to remind you that this presentation may contain certain statements that are neither reported financial results nor other historical information. Any forward-looking statements are based on Indel B current expectations and projections about future events. By their nature, forward-looking statements are subject to risks, uncertainties, and other factors that could cause results to differ materially from those expressed in or implied by the statements, many of which are beyond the ability of Indel B to control or estimate. Consequently, no forward-looking statement can be guaranteed, and actual future results, performance, or achievements may vary materially from those expressed or implied by such forward-looking statements. Let me now hand over to our CEO, Mr. Luca Bora.
Good afternoon, everyone. I'm here with the CFO, Mirco Manganello, and welcome to the Indel B fiscal year 2025 results conference call. Throughout 2025, we operated in a particularly complex and volatile macroeconomic and geopolitical environment. Against this backdrop, Indel B once again demonstrated resilience, strong execution capabilities, and a clear, disciplined strategic direction. The results we are presenting today reflect the strength of our business model, the quality of execution across all our operating segments, and the tangible value created by the strategic initiatives implemented during the year. Among these, I would like to highlight the acquisition of full ownership of Indel Marine, which marks an important step in strengthening our positioning in a high-potential segment. Looking ahead, we remain fully focused on delivering our growth strategy. We will continue to invest in industrial excellence, product innovation, and international expansion, leveraging the Group's solid financial position.
This will enable us to capture new growth opportunities, further strengthen our presence in key markets, and continue to consolidate our leadership position in the industry. Let's begin by summarizing the key facts for the period. On page three of the presentation, you find a summary of Indel B results achieved in the fiscal year 2025. In this period, the total revenues amounted to EUR 207.4 million, compared to EUR 203.5 million in 2024, with a 1.9% increase at current exchange rates, plus 2.4% at constant exchange rates. The sales of products amounted to EUR 201.5 million compared to EUR 196.6 million in 2024, with a 2.5% increase at current exchange rate, plus 3.1% at constant exchange rates. The EBITDA adjusted amounted to EUR 23.7 million, compared to an EBITDA adjusted of EUR 22.7 million in 2024, with EUR 1 million of increase.
EBIT adjusted amounted to EUR 16 million, compared to an EBIT adjusted of EUR 16.4 million in 2024, with EUR 0.4 million of decrease. Net profit adjusted amounted to EUR 10.2 million, compared to a net profit adjusted of EUR 11.6 million in 2024, with EUR 1.4 million of decrease. Net debt position amounted to EUR 17.1 million, compared to a net debt position of EUR 10.3 million as of 31st December 2024. In the next page is showing our group structure. Indel B, Indel Marine, Condor B, Indel North America, Autoclima Group, and Lindel S.r.l. are consolidated line by line, while the results of our joint venture, Elber, is consolidated under the equity method. The pro quota interest of Indel B in their net income is accounted at the EBITDA level.
It should be noted that on June 13, 2025, it was finalized the acquisition of the remaining 50% of the shared capital of Indel Webasto Marine S.r.l., of which Indel B already owned a 50% stake, bringing Indel B ownership to 100%. Indel Webasto Marine was then renamed Indel Marine SRL, given the immateriality of the transaction recorded by Indel Marine and its subsidiaryIn the USA, from the date of the acquisition of the remaining 50% to June 30, 2025, the board of directors assessed June 30, 2025, as the date of first consolidation using the full consolidation method. Therefore, at the economic level, the results for the first half of 2025 of the sub-consolidated entity of Indel Marine were accounted for using equity method, while the results for the second half of 2025 were fully consolidated.
On July 28, 2025, the Turkish company, Indel B Isitma Ve Sogutma Sistemleri Ltd. Sti., was established, 60% owned by Autoclima S.p.A. and the remaining 40% by a local partner. Let's move now to page 5. 2025 Sales. Product Sales increased from EUR 196.6 million in 2024 to EUR 201.5 million in 2025, up by 2.5%. This is related for -0.5% to the negative effect of the currency translation of sales, for -0.5% to the organic drop, and for +3.5% to the contribution of the new companies acquired in the period, Indel Marine and its subsidiary in the U.S., and the new company established in Turkey, Indel B Turkey. Let's move now to page six, sales by distribution channels. In 2025, OEM dropped by 8.5% to EUR 92.7 million, contributing to 46% of consolidated sales.
The decline is primarily due to the contraction in the automotive market in Europe and North America. After-market channel, generating 40% of the sales, posted a 17.5% increase, driven by sales from Indel Marine and Indel B USA, starting July 1st, 2025, in the Leisure market in Europe and North America. The others, generating 14% of the total sales, booked an increase of 5.9%, driven primarily by increased sales of components. Let's move now to page seven, sales by market. Automotive decreased by 2.3%, generating EUR 124.3 million, equals to 62% of the group's consolidated sales. The decline affected products installed as original equipment and is attributable to the negative cycle impacting both European and North American markets, where the phase of weakness persisted through all 2025. Leisure shows an increase of 33.6%, generating EUR 26.4 million, equals to 13% of the group's consolidated sales.
This performance is largely attributable to the contribution starting from July 1st, 2025 of the sales of Indel Marine and its subsidiary in the USA, in which Indel B acquired full ownership on June 13, 2025. Within the segment, growth was driven in particularly by marine sector, +55.8%. The RV market also show a positive trend with an increase of 3.6%. Components and spare parts showed a decrease of 3.5%, generating EUR 24.1 million, equals to 12% of the group's consolidated sales. The decrease is mainly due to a decline of the sales of spare parts in the air conditioning recorded by the Autoclima Group. Hospitality booked an increase of 3.9%, generating EUR 15.8 million, equals to 8% of the group's consolidated sales. The positive performance is driven by the hotel sector, while the cruise sector was weaker, recording a decline of 6.3%.
Cooling appliances increased by 16.7%, generating EUR 11 million, equals to 5% of the Group's consolidated sales. The increase is mainly to a recovery in the professional market for milk fridge orders, +43.4%, while the home market for wine cellars showed a weaker performance, -11.7%. Let's move now to page eight, sales by distribution region. The European market, excluding Italy, our most mature market, booked an increase of 4.8%. The increase is mainly attributable to the Leisure market driven by contribution of Indel Marine, acquired in mid-2025, and to the cooling appliances market, supported by a recovery in the professional segment related to the milk fridge sales. This positive performance was partially offset by a decline in air conditioning system sales in the automotive market. Sales in Europe, excluding Italy, contributing to 55% of consolidated sales, equals to EUR 111.2 million.
In Italy, sales decreased by 3.8%, contributing around to 26% of consolidated sales of the Group, equals to EUR 53.2 million. The decline was broad-based across all main markets, with the most significant impact on the Leisure market due to the weak sales in the Marine sector. In the America, sales increased by 5.1%, contributing around to 16% of consolidated sales of the Group, with EUR 31.7 million. The growth is attributable to the contribution, starting from July 1st, 2025, of the Indel B USA sales in the Leisure market, particularly in the Marine segment, partially offset by the continued negative performance of Automotive market sales in North America.
Sales in the rest of the world showed an increase of 7.6%, thanks to the positive performance of the Automotive market, specifically driven by air conditioning system sales. Move now to page 13, consolidated revenues, EBIT adjusted and net profit adjusted analysis.
In this slide, we show adjusted figures. Full reported figures are in the appendix. For the year ended December 31, 2025, non-recurring items had a net positive impact, driven by EUR 13.995 million gain from the fair value reevaluation of the Group's existing 50% stake in Indel Webasto Marine, now Indel Marine, following the acquisition of the remaining 50% in June 2025. These gains were partially offset by EUR 2.092 million in inventory-related acquisition adjustment and EUR 1.787 million in other non-recurring expenses, including the impairment of the investment in Elber Indústria de Refrigeração, and costs related to the consulting and the Executive Long-Term Incentive Plan. In the Fiscal Year 2024, the main adjustments are represented by the write-down of the investment in Elber Indústria de Refrigeração as a result of the impairment test and consultancy cost.
In the fiscal year 2025, profitability improved with the consolidated adjusted EBITDA reaching EUR 23.7 million, up 4.5% from EUR 22.7 in fiscal year 2024, representing an increase of EUR 1 million. The adjusted EBITDA margin rose from 11.2% of consolidated revenues in 2024 to 11.4% in 2025. This growth in EBITDA was driven mainly by the full consolidation of Indel Marine in the second half. The group net profit adjusted, however, decreased from EUR 10.2 million, 4.9% on total revenues, compared to the net profit adjusted of EUR 11.76 million, 5.7% on total revenues, reported in the corresponding period of 2024, representing a decline of EUR 1.4 million. Cost structure on page 14. Our cost base is mainly characterized by variable cost. Fixed costs represent about 32% of our total cost and about 29% of our total revenues.
The largest amount of cost refers to raw material and production costs, affected also from tariff. We have been able to manage these costs to mitigate the impact of labor cost increase and pressure on prices asked mainly from main OEM automotive customers based on existing contract in place, and particularly arriving from the customer of actual weakest market. Another effect for what concern the difference in production cost with a bit higher fixed cost, it comes from the product mix and from price management according to the different market situation and to each specific customer, based on the rigidity or flexibility of the price and relation in place.
We will continue to work on cost side and adapting our pricing to compensate or mitigate for the possible increase of cost arriving not only from raw material, but also from renewal of national labor contract, and especially from sea freight cost, raw material, and all what is related to. Let's move now to page 15. CapEx. Our business model is lean and flexible. Our CapEx is quite limited, and despite the investment in new production facility, we still have an interesting cash conversion rate, about 83%. On top of our normal investment on products and on production process, we purchased a new automatic equipment warehouse. We build new production plant in Russi, Ravenna. On page 16, you find the net operating working capital.
As of 31st December 2025, net operating working capital amounted to EUR 76.2 million, 37% of total revenues, compared to EUR 64.8 million as of 31st December 2024, 32% of 2024 revenues. The changes in the amount of the inventory, account receivable, and account payable amount is mainly due to the consolidation of the Indel Marine and Indel USA balance. The inventory has not slow-moving or obsoletion problems. Let's go now to page 17, net financial position. As of 31st December 2025, net debt amounted to EUR 17.1 million, compared to the net financial debt of EUR 10.3 million as of end of 2024. The net financial position worsened by EUR 6.8 million. I just remind you that the net financial position also includes the debt related to IFRS 16, corresponding to the obligation to make lease payments for EUR 3.5 million.
The increase in financial debt is attributable to the rising of new loans, primarily to finance the acquisition of the remaining 50% of the share capital of Indel Marine, a transaction that was completed on June 13, 2025. It was also used to pay dividends of EUR 0.8 per share for a total of EUR 4.2 million. Short outlook about 2026. The international geopolitical and economic environment continues to be highly complex and uncertain due to the ongoing conflict in Ukraine, and in particular, to the recent tension in the Middle East involving the United States, Israel, and Iran. These developments include disruption in the Strait of Hormuz, generating not only rising costs of energy, but also of all oil-related products, logistic costs, and other main raw material, and start to generate also shortage of some raw material, creating a new inflationary pressure in the Western markets.
At this stage, given the uncertainty surrounding the duration and the evolution of this conflict, it is not yet possible to reliably estimate the potential impact on the Group. Uncertainty is probably the word most used to define the period we are living, characterized by very low visibility or visibility that can change much faster than we are used to in the past. In 2026, it will be essential to maintain careful and continuous monitoring of the macroeconomic and geopolitical landscape, and consequently, the evolution of the market, both from customer side and from supplier side, allowing us to promptly adjust, if necessary, the action already in place to preserve the Group financial strength as well as revenues and profitability levels.
The Group's starting position, characterized by low leverage, strong cash conversion capacity, and balanced financial and asset structures, currently allows us to operate without any material concern regarding business continuity. Looking further ahead, the Group remains confident in its medium- to long-term prospects, supported by expected market growth and the initiatives already underway, particularly in Automotive, Hospitality, and Leisure sector. We will continue to invest in industrial excellence and the development of international markets with a strategic focus on North America and Europe. Finally, the Company will continue to invest regularly in any direction, product, production, and organization, to be ready for the future opportunities. I have completed my presentation and now at your disposal for your question on our results. Please, go ahead.
We will now begin the question and answer session. To enter the queue for questions, please click on the Q&A icon on the left side of your screen. When announced, please click on Continue on the popup window. If you are connected in audio only, please press star one on your telephone. First question is from Milo Silvestre, Equita.
Good afternoon, everybody. I was wondering if you can elaborate on 2026 guidance, even if, say, disregarding the impact on Middle East. If you can elaborate on revenues a bit, that trend on the year, and what are you seeing by each segment in this first few three or four months of the year?
Thank you for the question. As I said, the situation is very difficult to understand and to predict what will be the evolution. Please consider this first of all. What we are facing in this period is, for example, an increase of orders from North America for what concern Automotive, and this is partly unexpected. We did our budget for 2026 before, of course, the war in Iran was started. Our expectation for the first half of this year was not as it is today. Even if there is this geopolitical complex situation, the automotive OEM market in North America is going better than expected. For the rest, it's also Europe going a little bit better for Automotive. Other market, we still see Marine in Europe weaker, America, much more resilient. Hospitality, more or less on the same level of last year, not big change.
Those are the main market. The most important concern and the question mark regarding the future is the cost, where it will go, because even if we see more incoming orders, for example, for North America regarding automotive mainly, in the same time, we are facing all raw material growing in term of cost. Today, it's not generating any impact on the profitability of the first quarter and probably also on the second quarter, because, of course, what we are going to source now, it will probably have an impact in the second half, but it is the most complicated things we are facing. All the material, not only the oil-related ones, but mostly all the materials are increasing in term of cost. In term of energy cost, we are not so much impacted. Our production process do not use too much energy.
Really on our production will not be the issues of the energy cost, but mostly of the components we buy, steel, copper, aluminum, plastic components, raw material for plastic and so on. As you know, as you remember, our business with the big OE, for example, is quite rigid. It doesn't mean that we cannot ask price revision. We did that after the COVID when there was a spike on the oil raw material and also shortage of electronic components with cost rocket high also about that. It's not so easy to get and it takes time before to obtain. For sure, the biggest question mark today for us is availability of the component, because we start to see also difficulties to find components, especially oil-related, like some specific plastic, and also to transfer the increase of the cost to our customer.
It's difficult to say which will be the impact, to be honest, because we are in the middle of the way. We don't know if this will be the level of the cost for the future, if the price will go back on the main raw material. It's really difficult. We need to navigate in a complicated situation and to do our best like we did in the past. It seems that there is no normal period. As soon as we arrive to a normal situation, a new storm, it's arriving again.
In December, when we have done our whole business plan or new business plan, there was not also the war. We preview about increase of turnover, about double digit, 8% about, especially for Leisure. Leisure was reconsolidated for one year of marine. An improvement on the sales of Hospitality market and a little bit in the Automotive. Now, as Luca says, it's not easy confirming this figure.
The main problem is not order. The very strange thing is that in this moment, we do not have concern about order in this moment. Maybe tomorrow the order will disappear. Today the concern is not regarding order, it's regarding cost of what we are going to buy to make our production and availability of some specific material and component. Just to bring one real example on the table, for our production, we need, in many cases, magnets, special type of magnets that we source in China with a rare earth inside. China is blocking or creating a lot of problems to clear custom for this particular component. Just to bring an example, all this tension between U.S. and the rest of the world, the U.S. and China that try to protect what they have.
It's really complicated, and the situation is becoming more and more complicated. Today, the concern is not orders. We are not facing orders disappearing. The main problem is costs that are still growing and sometimes availability. Another very simple example is helium. We use helium to make some tests, and helium, again, is one of the material that starts to be not easy to find. The priority for the helium is not for our production, but maybe for some other application, like in the hospital and so on. In our case, we have several situation that we need to, on daily basis, manage to find a solution. Till now, we have found solutions. Probably we will continue to find solutions that arise. This is the main concern today. It's not orders, but to be able to get components first and then to get at the correct price.
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As a reminder, if you wish to register for a question, please click on the Q&A icon on the left side of your screen or press star one on your telephone. Next question is from Fausto Covolan, EOS Capital Partners.
Hello?
Yes.
Ciao, Luca.
Ciao.
First of all, chapeau for the results, especially for the cash generation, in not an easy period anyway. As you say, 2026 is going to be a question mark for availability of components, but I do believe that you are on the same boat as your competitors at the end of the day.
Yeah.
In the business, which is in a tough situation, is all the market, which has a lot of question marks. I had a question on the working capital, because you generated a pretty decent level, as I said, on the cash conversion. Working capital remains anyhow elevated. Maybe is a blip due to the Indel Marine acquisition, which increase the inventories.
Yes.
Let's say, in 2026, what we can expect, which level of net working capital as a percentage of sales could you consider on a normalized basis? How much cash could you release in 2026 from inventories and receivable alone?
This is a very interesting question. I anticipate Mirco, because I want to give you an answer from a operating point of view. If I could have, at this moment, even higher, let's say, inventory, I would be happy. Of course, higher inventory of the right items, I would be very happy. Because we are suffering like hell in this moment, due to the fact that the components are not easy to get, because the transit time is much longer than before. Imagine that it is true. The first answer, yeah, the net working capital increase mainly due to the acquisition of the 50% of Indel Marine and the subsidiary in U.S. We fully consolidated those two companies, so we bring inside all the inventory of the Italian entity and the U.S. entity.
Mainly that for the North American market, we source a lot of components now, and you cannot find in other place of the world. Because it doesn't matter, the globalization is still there and many items you find in China. What we source in China, we use to produce in Italy and then to ship in U.S. We need to respect 100% the request of our key customers that today ask us 100 pieces and then tomorrow, they ask us 200 pieces. We are suffering really like hell in this moment. As I said before, the concern today is not the order, and we are really receiving unexpected orders higher than we considered before the war started in Iran. The main difficulty is to get parts from China, to transform in Italy, and then to ship in U.S.
All these processes, really long. Today, the priority for me is not to reduce the inventory. Yes, we will work on that, because for sure, on the inventory, we have some item that are at too much higher level. For many items, to preserve and to protect ourselves from a critical situation like this one, and now start to be not exceptional. Every one year or two years, there is a new exceptional situation due to the fact the Suez Canal is closed, and then you need to go through south to the Cape of Good Hope, or maybe the war in Iran, or maybe something else, or shortage of components. Really, to preserve our business, probably we need to increase some inventory, not all, but specific one.
Yes. If we go deep into the figure, Fausto, we can say that in a normal condition, when we have done our business plan and we consider to improve for the days of our invent. In 2024 was 186 days, DOI, days of outstanding inventory. Now we improve at the end of 2025, 10 days about. And our target for the next year is arrive to 160 days. But this is in normal condition. As Luca saying, it's not easy in the condition that we see in this day. About the cash, we think we consider in our business plan a normal operating cash flow, about EUR 12 million per year as we have in the normal situation.
Also, when we consider the inventory, we must consider that both our products that are stored in warehousing in North America, both also the product of Indel B USA, North America, the same product today has higher value in the inventory because we pay tariff. Before there was no tariff, so a product that has EUR 100 value, just for example, now if it's from Italy, the value is EUR 150 because there is 15% tariff. If it's from China, it's even more, is 45% more than before. Anyhow, we work, of course, on this situation because always the inventory, you miss what you need, and you have too much of what you don't need. For sure, there is a space to work and to be better.
Today what is making a big anxious us is to get part to fulfill the increase of order that we are receiving that was unexpected.
Sorry, Luca. I have a follow-up on this issue, the fact that you're receiving unexpected order.
Yeah. From U.S. automotive truck producer.
Okay. Could be also the fact that some of your clients are trying to polarize on reliable, let's say, player. At the end of the day, you are a reliable player in Europe and also in U.S. Some other competitors might be under stress.
Sorry, please finish.
No. Do you have the gut feeling that you are getting or you could get a higher market share going forward?
What you said is partially true. The increase of the order that we are receiving in this moment is not due to that. It's due to the market itself that is recovering. Our customer are receiving more order. The take order of our customer is increasing more than they expected in this month. Really the specific situation is due to that. It is true that some of our competitors of Indel B, but also of Autoclima, let's say, within the group, they are facing a not easy situation. To be very clear, for example, Webasto, that was also our partner inside Indel Webasto Marine, is facing a very complicated financial situation since some years. Very complicated. This is an opportunity, and we get already some order from customer that was historically a customer of Webasto.
We could say also something more about specific competitors of Indel B. It's true what you said, but in this specific moment, the big quantity order that you are receiving from North America is mainly due to the market situation itself.
Okay. Thank you very much.
For any further questions, please click on the Q&A icon on the left side of your screen or star one on your telephone. Next question is a follow-up from Milo Silvestre, Equita. Milo Silvestre, your line is open.
Yeah. Good afternoon once again. I would just have, let's say, a comment on tariffs. What could be the impact on 2026, and more generally, how do you manage the situation?
The tariff is mainly generating an headache to us. Today, we've been able, during 2025, to manage the tariff issues, the increase of tariff in a good way. That means we reach an agreement with all of our OEM in North America, sharing the tariff. In most of the cases, we have been able to get 85% of the total tariff as a reimbursement in most of the cases, and sometimes even more than 85%. Of course, if you consider this, it means that anyhow, this we discussed also years ago when there was a similar situation. If I have, for example, EUR 50 more as a cost, and I have a reimbursement from the customer of EUR 50, this has an impact on the profitability when I calculate as a percentage of the revenues, even if I have the compensation.
I consider even more based on that, a good result what we have achieved considering that there was a tariff, and I cannot put the markup on the tariff. If I'm good enough, I can just be reimbursed from the tariff itself. About 2026, there will not be another impact because already the agreement is in place with all those customers. The impact is mainly coming from increase of raw material cost. If we're able or not to revise our price list in time as fast as possible to our customer, but not due to the tariff. The tariff will generate another idea, because since when the Court in North America announced that those tariff are illegal. Of course, the U.S. President, U.S. administration introduced a new temporary tariff. Those are legal. For European production, it's still 15%, it doesn't change anything.
Now we have our big customer in North America, from Volvo to Daimler and so on, that are asking us formally to put in place all the efforts that have to be considered to get a reimbursement of the tariff from the U.S. government. Of course, this will have zero impact to us, because if we get the reimbursement, it will have a small impact to us as a benefit because, as I said before, we share the cost of the tariff, so if I pay $100, let's say Daimler reimburse will be $85 and $15 was my cost. If I can have the reimbursement from the U.S. government, I will give to Daimler $85, and I will keep $15 for me. It will not be easy at all to get the reimbursement of the tariff from U.S. government.
This is another activity that we need to put in place based on the agreement we have been forced to sign with our customer. We will see at the end of the year if we will get back something from the U.S. government or not.
Crystal clear. [Non-English content].
For any further questions, please click on the Q&A icon on the left side of your screen or star one on your telephone. Ms. Benazzi, we have no more questions registered at this time.
Okay. If there are no more questions, I think we are done for this afternoon. First of all, thank you to all of you for participating to this conference. I just want to give you a quick reminder for the next releases. Annual General Meeting will take place on May 25, and the first quarter 2026 consolidated s ales revenues will be released on May 12th. If you still have some questions to investigate, please do not hesitate to contact me or the CFO. Thank you very much.
Thank you. Bye-bye.
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