Good afternoon, ladies and gentlemen, and welcome to WashTec's earnings call on the results of the first third quarter and the first nine months of 2026. My name is Kevin Lorenz, Investor Relations Manager at WashTec, and with me today is our Chief Financial Officer, Andreas Pabst. We will first provide an update on current developments at WashTec and then guide you through our financial results. Following the presentation, the floor will be open for questions. You may already now enter the queue or submit your questions via the webcast. I am now handing over to our CFO, Andreas Pabst.
Thank you, Kevin. Hello, everybody. Also from my side, a very warm welcome. I am pleased that you took the time today to listen to the latest news and figures on WashTec, especially as there has been a lot to speak about since our last call in August. Before we step into the figures, I would like to address four current topics: the changes in our organization, the geographical expansion of Mark VII in North America, the status of our main efficiency programs, and the progress of the production relocation to Nýřany in the Czech Republic. All of them are essential for our future development and explain some of our current results. Let me start with the organizational changes. First, the supervisory board has extended the contract of our CEO, Michael Drolshagen, until the end of April 2030.
This provides leadership continuity for the coming years, and it gives stability to move strongly forward on our path to become the leading solution provider for the global car wash market. Our management board consists now of two members for the foreseeable future. This contributes a lot to faster decisions. At the same time, we have streamlined reporting lines and redistributed selected responsibilities within the organization. A central part of this change is the appointment of Arthur Wessels, a Senior Executive Vice President for Global Sales and Marketing. Arthur has been with WashTec since 1992, so he is really an experienced guy. In Germany, we would say, "Ein alter Hase." He knows our business, our customers, our markets extremely well, and therefore strongly endorses our transformation from an equipment to a solution provider.
His previous responsibilities included our global key account business, standing for approximately 40% of our revenues, our subsidiary in the Netherlands, and the car wash management business. We also have made several changes at middle management level, e.g., Head of Global Service, Head of Product Management, one regional head, and some others. Those changes were implemented till October. Here, our objective is quite simple: clearer responsibilities, faster decisions, and stronger accountability through the whole organization. These unplanned expenses of currently EUR 2 million relating to these organizational optimizations are reflected in our first nine months figures, which I will explain later. Let me make here one important point. If you walk through the aisles of our company and when you participate in meetings, you really can feel this revitalized optimism which comes along with this new wind in the management team. Speed matters.
Now, let us have a look at our North American segment. You know that we have presented the five pillars of our strategy 2030 for North America during the latest capital markets webcast. Today, I want to focus on the pillar for the geographical expansion of Mark VII. Our strategy is to strengthen direct sales and services in high-volume wash markets while keeping customers' relationship close to Mark VII. In selected other areas, we will continue to work with hybrid territories where this is the better commercial setup. We are also establishing direct consumable sales channels in the most attractive markets. This gives us better access to large tenders from multi-site operators and supports our focus on C-stores, fuel stations, and professional car wash operators. The important message today is, we are on track.
The additional equipment and consumable sales representatives planned for this phase have been hired according to schedule. We finalized our hiring in most states, and we are targeting. As of September 13th, we have 345 employees, whereas at the beginning of the year, we had 306, similar number than at the beginning of Q3. Most of these new hirings are in the sales and service area. We have implemented for every sales rep and every service technicians a so-called toll gate after six, 12, and 24 months to check if our expectations have been met. On the other side, we all know that there is a ramp-up and a learning curve in the first months, what we see in actual quarter. The next task is now to translate this stronger market presence into sustainable revenue and recurring business. This brings me to our main efficiency programs.
Let's start from the right. The Global Scope Configurator remains on track. We plan to onboard all European countries by the end of the first quarter 2027, and the content for scope two and scope three has already been agreed. Why scope two and three? That's because our sales reps really start to love the tool. You can see it on the graph on our pilot region. The line indicates the number of rollovers ordered via the Scope Configurator. The cost down and modularization program has seen some delay because management capacity was focused on the production footprint, installation costs, as well as on quality. The improvement in quality is illustrated by this gauge, which shows that after just nine months, we are already very close to our full-year target of 717 quality points. Quality has increasingly become part of WashTec's DNA.
In installation, our task force is showing visible progress.
Installation costs per unit has now decreased for the third month in a row. However, absolute cost level is still above prior year, so the job is not finished. For the remaining program, optimization of production footprint, let's turn to the next page. The main topic of optimization of our production footprint is for sure the enlargement of our Czech production. The project is now nearing completion. Sheet metal production and the warehouse in Derching, near Augsburg, have been closed. The machines and workstations have been transferred, and the new equipment, including laser and bending machines, is operational. The assembly relocation has also been completed without major production disruption. The new warehouse is commissioned and operational. This is an important achievement given the complexity of the project. Only two minor steps remain.
In plant 1, we need to relocate welding workstations to the former assembly hall, and in plant three, around 1,200 inbound logistic storage locations remain to be transferred from Augsburg to Czech Republic until end of this year. We expect the full project, including all possible transfers, to be finalized around the end of 2026 or the beginning of 2027. We see the progress of the project. We see that it is working, and it will contribute to our future profitability. But we underestimated the complexity of the relocation and prolonged negotiations with the workers' council. We expected to get first savings earlier to cover better the transformational cost. Here, we failed, as the project is not cost-neutral in 2026 as originally planned. Nevertheless, management is convinced that the expected savings will materialize once the new setup is fully operational. The strategic direction remains unchanged.
We see progress, but we must convert this progress into stronger earnings faster. With this operational update, let us now come to the financial figures for the first nine months and the third quarter of 2026. Summing up the first nine months in one statement: positive revenue performance, but EBIT and free cash flow were clearly weighed down. At EUR 375 million, revenue for the first nine months reached the highest level shown in this five-year comparison, an increase compared to prior year by 4.6%. Both our Europe and other segment and North America contributed to this growth. All-in EBIT amounted to EUR 25.7 million compared to EUR 32.4 million in the prior year's period. The corresponding EBIT margin was 6.9%. Taking out the EUR 2 million for ongoing organizational optimization, EBIT stands at EUR 27.7 million with an EBIT margin of 7.4%.
North America improved year-over-year, while Europe and other segment was affected by expenses for the implementation of our efficiency programs and organizational optimization. Free cash flow came in at EUR 8.6 million, EUR 19.2 million below the previous year's level. The main reasons were significantly higher net operating working capital and increased capital expenditures. The chart shows the central challenge very clearly. WashTec has grown its top line, but the conversion of this growth into earnings and cash flow needs to improve. This is exactly why we're speeding up the implementation measures and programs, why this is so important. Looking at this specifically at the third quarter, revenue was EUR 127 million, slightly above prior year's period. The revenue mix shifted towards North America and toward equipment, while consumables remained affected mainly by lower wash volumes.
The third quarter EBIT was, even excluding extraordinary expenses for organizational optimization, clearly below prior year. The quarter continued to carry costs from the production footprint measures and installation costs at a high level, even if we see now some improvements month-on-month. Also in Q3, we see for the first time a slight increase in material costs, mainly for chemicals and some metals like copper. North America, we follow our strategy and see the expected dip in line with higher number of employees. Free cash flow was also below the comparable period, reflecting the higher working capital requirement and investment activity. Let us look now at our business lines in more detail. Overall, equipment is the main growth driver. Revenue in the first nine months increased by 6.9% to EUR 196 million, whereas in Q3, we had a slight decrease.
Year-to-date growth was recorded in both segments, with a significantly stronger percentage increase in North America. Service revenue increased by 4.7% from EUR 116 million to EUR 122 million. This is encouraging because service is an important part of our recurring revenue base and benefits from the expansion of our installed equipment base, as well as from the additional 47 service staffs we have on the payroll compared to last year. Consumable revenues decreased by 2.6% to EUR 52 million, mainly due to the weather-related decline in the car wash volumes in the first four to five months of this year. Furthermore, we had very closely observing the behavior of our car washing people facing higher fuel prices. Overall, the revenue decrease was less pronounced than the decline in the average wash volumes per equipment. This underlines the resilience of our pricing and customer relationship.
In Q3, we already could observe a slight increase in consumable revenues. If we look at our aim to expand recurring revenues, we see a slight step back after nine months. Recurring revenues stand for 46.5% of total revenues, whereas prior year, we already had 47.5%. In Q3, the ratio improved again, and we believe that with our strategy to become a solution provider with our supporting initiatives like the Scope Configurator, we are on the right path here. Turning to our reporting segments. In Europe and other, revenue in the first nine months reached EUR 380 million. Equipment and service increased, while consumables were below the prior year due to the lower wash volumes. In third quarter, segment revenue was 0.9% below prior year's period, mainly because of lower sales volumes.
Earnings in Europe and other were burdened by the implementation costs of our efficiency programs and by the EUR 2 million for extraordinary expenses for the organizational optimization. North America developed positively. Revenue in the first nine months increased significantly by 16% to EUR 60 million. Third quarter revenue was also significantly higher. The improvement was driven primarily by higher equipment sales volumes with key accounts and in the direct sales business. With the higher revenue, North America EBIT increased to EUR 1.3 million in the first nine months. In general, we are pleased with the progress and respect the dip in Q3, as we understand that this is an investment in future increasing profitability. This is where our geographic expansion and stronger direct organization should contribute over time. Here you see our well-known EBIT bridge. The positive revenue development contributed additional gross profit.
However, keep in mind that in our most profitable business line, consumables, we had a slight decline. This positive effect from increasing revenue was more than offset mainly by the lower gross margin, higher selling expenses than the one-off organizational optimization expenses. The main operational reasons behind the gross margin pressure were the relocation to the Czech Republic, including adjacent expenses and installation costs. The mix affected also played a role with stronger growth equipment in North America. The key point is that a meaningful part of the earnings pressure relates to measures that are intended to improve the structural profitability of WashTec. Nevertheless, these costs are visible in the current P&L, and we need to execute the final project steps with strong cost discipline to have better profitability in the near future. Coming now to some additional financial KPIs.
Net income and earnings per shares decreased in line with lower EBIT. Earnings per share were EUR 1.21 compared with EUR 1.57 in the prior year's period. Net operating working capital increased alongside the normal buildup in line with business activity. It's worth spending a word on inventories. With the start of the war in the Gulf region, WashTec decided to increase safety stock, but also other effects led to higher inventories. One is in connection with the shift of workload from Augsburg to Czech, and another one comes along with the movement of our spare parts storage to a new location in Germany. Because of the higher working capital, the increased dividend, and the share buyback, net financial debt increased. CapEx in the first nine months focused on the expansion of the Czech site and the development of digital products.
These investments support our business model transformation and our future offerings, but they also caused a lower free cash flow in the reporting period. Looking at the balance sheet ratio, the equity ratio decreased mainly due to the dividend payment and the share buyback program, which was completed in March 2026 and amounted to EUR 4.8 million. Sorry. Excuse me. The fixed asset ratio remained largely stable. The number of employees increased by 119 year-on-year. The increase was concentrated in areas close to revenue and operations, 47 additional employees in service, 35 in sales, and 37 in supply chain. This strengthened our ability to support customers and growth. At the same time, given the current profitability development, we are continuing to manage headcount and cost additions very, very carefully. On this slide, we see our long-term index order backlog.
In North America, we had this year a quite good equipment order intake. On the other side, we saw in Europe, in some markets, a slight slowdown in order intake in the last quarter, whereas some other markets clearly outperformed prior year. That all sums up that our current order backlog is slightly down compared to Q3 2025, but still clearly above year-end 2025. Overall, we are confident with the current order backlog, which gives us some stability for the coming months. Looking into our sales funnel, which indicates possible future order intakes, we can be optimistic for increasing future equipment business. Let us finally turn to our guidance for 2026. We confirm our revenue guidance and continue to expect a mid-single-digit percentage increase compared to the EUR 498.6 million generated in 2025. As communicated on September 14th, we now expect an EBIT margin between 8% and 9%.
This reflects the delayed benefits and higher implementation costs of our efficiency programs, the lower-than-expected consumable revenues, as well as the extraordinary expenses in course of the organizational measures. For ROCE, we expect a level below the prior year, consequently reflecting the revised earnings outlook and the higher capital employed. We currently expect to meet a free cash flow range of EUR 35 million-EUR 45 million, more likely at the lower end. As always, this guidance is subject to uncertainties and reflects our expectations based on current knowledge and the current macroeconomic environment. Significant deviations in either directions are not factored in. To sum up, revenue performance remains positive. North America is improving, and our major production relocation is close to completion. At the same time, profitability in 2026 is below our original expectations.
Our clear focus is now on completing the efficiency programs, lowering installation costs, and realizing the benefits of the new production setup. This concludes my remarks. Thank you very much for your interest. I am now handing back to Kevin.
Thank you, Andreas. We will now begin the question-and-answer session. If you wish to ask a question, please use the Q&A function in the webcast and follow the instructions. You will see confirmation once you have entered the queue. You may also submit written questions. Looking at the list, we have already received one question from Alexander Galitsa. Nice to see you back. This question is, "Is the new 8%-9% EBIT margin guidance to be seen as reported or adjusted? That is, after excluding certain one-offs. Also, what exactly is excluded? Implied Q4 EBIT is EUR 16 million at the low end of the margin guidance and EUR 21 million at the high end, 9%." Maybe we already first start answering that, and then I continue because it is quite a long text.
Yeah. Maybe it is important to stress that again. The guidance we are giving with 8%-9% of EBIT margin includes all expected costs. So it is there without any adjustments.
So, he says, "Implied Q4 EBIT is EUR 16 million at the low end of the margin guidance, 8%, and EUR 21 million at the high end, 9%. Clearly, EUR 21 million EBIT in Q4 high end is entirely out of reach. What has changed since you issued the ad hoc mid-September that invalidates your revised EBIT margin range?
I'm not sure if I completely understand the whole question. We gave a change, or we adopted our guidance on September 14. The figures we saw there are still the figures we see as of today. It is not a change there. We see that Q3 is not at a level where we want it to be, but that is what we expected. If I look into our order book and to the expected revenue for the fourth quarter, that is why we think that this revised guidance is what we believe right now.
Another question from him is, if we have enough visibility on growth and sales mix in Q4 to comfortably offset higher costs and land at or above the low end of the range.
Sorry, didn't get it.
If we have enough visibility on Q4 to confirm our expectation between 8% and 9%.
Yes. That is what I already said. That is what we really believe. There is always the risk at every year-end that some of the revenues could slip in the next year or something like this, but we do not believe it right now. If we look at our top line, what we expect to deliver, if we see that our programs, especially the relocation to the Czech site, is now more or less close to an end, we see what costs we have there. That is the reason why I strongly believe that we will manage this. But you also know that part of our business, like consumables, is a little bit of weather-related. If there will be rain from tomorrow onwards until the end of the year, then it might be difficult. But in general, that is what we stand for.
Another question from him is, how much are the total annualized savings from the relocation?
In the past, we always said that we relocate, and that is still the case, that we relocate 85 people from Augsburg to Czech. The annualized savings, labor cost savings, is up to EUR 30,000 per headcount. That altogether gives us some close to EUR 3 million.
And one more before. He is asking, how much we are raising our selling price and if it offsets increased material prices.
What we see here is that we have already increased our prices in our price list in summer this year. This will now kick in after the delivery for each new rollover of each new equipment. That is what we have done in the middle of the year. What we see now in Q3 is that in some parts of our materials, their prices are increasing. Their prices are increasing, especially for the basics for consumables and some of copper-related parts. But in general, it's leveling out.
Maybe we move to Stefan Augustin. Alexander Galitsa asked a couple of other questions there, but maybe let's see what remains after the others went through. We see Stefan Augustin. Stefan, you should be live now.
Yes, great. Can you hear me? Just to double-check.
Yes, we hear you now.
Good. Thank you for taking the question. Actually, the first one is a little bit on the Czech Republic again. You outlined that you expect the savings then during 2027. Do we have to think about the savings coming in one single step? Once you have agreed with the works council that all things work smoothly and you shift the employees in Augsburg out, suddenly the savings are here, or will that be also a bit more gradual on the ramp-up and the shifting of the volumes?
It's not from one day to the other that all savings are coming in. What we already see during this year is that we are ramping up people in Czech, and we have people still here in Augsburg to learn from each other. What we currently have is that the number of employees are going down in Augsburg, and in Czech, we have reached the number we need. It's more now that the remaining workplaces needs to be completely transferred or taken out in Augsburg. That will happen until end of this year. I strongly believe that the majority of the savings will be there for the whole year 2027.
Mm-hmm. Thank you. The next one is, you said that you have looked already largely at the chemical business a bit more into the relationship of what consumers do for car wash versus the increase of the fuel prices. You did not really comment on the outcome of this examination, but what do you actually expect? Could there simply be the possibility that once the consumer is crunched a bit, we need to factor in simply lower amount of car washes during a year?
I'm very closely observing this. If I look at the past, what happened there, in the past there was always a very, very strong connect between the weather and the number of car washes, and therefore the number of consumables used. If we had an external effect like COVID, or people started not to wash their car for some weeks and then they came back, because really everybody wants to have a clean car. What we currently see the last two, three months is that the very strong relation between weather condition and number of car washes is. The database is not so strong as it was in the past. That is nothing I am concerned, but that is something I'm really looking at the detail, and to see and to observe if there is a change in the market.
But again, what is really important for me to make a statement here as well, if I look at the total amount, the total quantity of tons of chemicals we sold this year, it is pretty close to the number we had last year. So, overall, the business in a very strong and good condition, but I'm careful if there is a change or not. The data is not there to have really an answer on it.
Is the last statement that you made, let's say, for the same amount, that is year to date, right?
Correct, yeah.
Okay. Let's say, what would be your gut feeling if indeed consumers would wash a little bit less? Would you see that the big key accounts start to get more hesitant on their planned projects? Is that something that their decision actually is based on, or is that something that they would I mean, they have other thoughts about why and how they invest?
That's nothing which we currently really observe. Overall, the car wash business for the operator is still very, very profitable. It's no indication that they really changed their behavior so far.
Mm-hmm. All right. The last one is, if I looked at that correctly, we have good equipment sales in North America. We had a bit less equipment sales in Europe. We had some good service, and we have, let's say, from a mix shift, Q3 should be good. All that factored in, we would have a quite high operating leverage on the equipment sales in Europe right now. Is that fair to say that this is currently the state and that it works on the upside? If you have in Q4 additional volume, you would see a good operating leverage on the equipment in Europe, and if, well, if there would no volume or less volume come in, it goes both ways right now?
Not sure if I really understand the question all deep, but what I see is that the business in North America is in a pretty good shape. Also, the order income is pretty good there as well as for the first nine months, as well as for Q3. If I look at Europe, it is really a difference between the markets, the different countries. What we see in Europe is a slight step back in France and in Germany, whereas other markets like Nordics or Spain currently, they are really outperforming the last year. It's a month-by-month topic.
Overall, the order intake in Europe is slightly below prior year, but if I go a little bit deeper in the sales funnel, meaning where our sales reps are evaluating what they see in the market with the possibility, I strongly feel that the funnel is in a good shape.
Mm-hmm. But, okay, coming back from here again, your current cost structure in working off the equipment orders is so that there is quite a significant sensitivity worth this towards more volume. If you have more volume in Europe, you would have a sharply increasing profitability, and if there would be no volume, then we simply have the cost savings.
Correct, yeah. There is a strong relationship between volume and the overall cost structure.
All right. Thank you very much.
Welcome.
Thank you, Stefan. Good. Then maybe one question from Philipp from UBS from Tesling before we hand over to Jan Hummel. The question is, why was the order intake in Europe down in Q3, and why are you optimistic on the sales funnel?
Why is the order intake? Because customers didn't sign the orders, but it's choking a little bit. I explained it a little bit about the different countries, what is the state there in the countries. Why I'm optimistic? Because if I look in the sales funnel, I see that there are a lot of opportunities which indicate that if we can convert those opportunities into real order intake, that will be positive for us in the near future.
Then I'm handing over to Jan Hummel, from Paradigm Capital. Okay. Anybody else?
Yes. Can you hear me?
Perfect. Yes.
Good. Excellent. Thank you for taking my questions. Of course, Andreas, this is a huge disappointment for such a stable business. You have gone through some efforts to explain why things did not go as they did. You talked a lot about the Czech. In fact, I have two questions in total. One is a little bit more clarification on the Czech one. We are supposed to save about EUR 2.6 million a year, if I did the math correctly. We have invested how much, including everything, including these EUR 2 million, including, I think I saw a number of close to EUR 4 million plus early years. What is the investment for this?
If you look at our cash out for CapEx, the number is related to the digital topics as well as to Czech. Overall, you are totally right. The CapEx is higher than last year, and the main portion of it is to Czech. Currently, we have invested to Czech between EUR 4 million and EUR 5 million in additional CapEx.
Then we invested how much in extra costs? We have EUR 2 million, and then we have how much more? The cost overrun was EUR 2 million, if I understood it correctly. That is what you mentioned here, right?
Yes. Approximately, yes.
So is that all? We have invested this fixed assets plus the EUR 2 million in a cost overrun? Haven't we invested anything else? I am just trying to get a sense for what is the return on the money that you have taken and invested in the Czech. That is all. It is nothing complicated to it. So it is EUR 4 5 million plus EUR 2 million plus something, and I want to put that into relationship what we are saving.
My expectation is that until the end of this year, we have to do a little bit more of CapEx. Let us put EUR 1 million, EUR 1.5 million.
Yeah.
That is the total invest which we have done. There are not really any severance payments we needed to do for reducing employees here in Augsburg. I think that is very positive. We have now all the employees in Czech to do the production. That means we can have the savings from next year onward, year-on-year basis. If you calculate just the labor cost arbitrage, it is EUR 2.6 million, EUR 2.7 million. Then you need to deduct the amortization or depreciation of the additional CapEx. So if you would say it is EUR 6 million and divide it by 10 years, so it is EUR 2.6 million minus EUR 600,000. Then there is a little bit more of transportation costs, because more volume has to be shipped from Czech to Augsburg to do the final assembly.
Okay. Thank you. I have one more question, and that is this additional personnel that you have employed this year. I was a little bit surprised to see, I think the number was 119 people that you have employed. I presume before that you had 1,450 people perhaps in Europe. Would that be a reasonable assumption? So in total, you increased your workforce with 8%, and these were, I understand, in very particular, two areas in particular, in service and in sales. So that would mean that it was even a larger number. How do you think we should understand this, that you can employ all these people at full capacity, 100%, from day one when you take them on in such a short space of time? It is not really comprehensible to me how you do that.
I'm sure in those segments, without knowing the details, is way above 10% that you have newly employed people and expect to have them fully employed from day one, which is very important for the company as well as for the individual. Take us through your thinking there as management when that took place.
If you look at this, it's very important to divide where the people are coming from or where the additional people are coming from. In the presentation, you see also a small little donut where the 119 people are broken up. Part of it is in terms of our supply chain, that is production, that is really part of the double counting, Czech, Augsburg, where we need to reduce the numbers again. That is what we are doing. Fully understood. Now the topic is that we have invested in service people. If you look at our business line service, I guess it's developing in the right direction. We have hired mainly directly service technicians, but we also did a lot of them in North America.
What you see here is that if people start to work in this service business, they need some months to come up to speed and to contribute positive. That is part of the dip in North America, where we have hired around about 40, 39 people in Q3. That is, you have the cost, totally understood, but the people are not fully effective. I guess with the new onboarding of the people, which we are also doing, I believe that the onboarding time will be reduced and that they will contribute in the near future, especially the service technicians.
Hmm. Okay. Thank you. Those were my questions. Thank you.
Thank you, Mr. Hummel.
Good. Then, one question from Moritz Walz from Discover Capital. "Can you quantify how much of the EBIT margin downgrade is due to delays, implementation costs, and other one-offs? In other words, what would the nine-month EBIT or full-year EBIT look like excluding these one-offs?
I am hesitating. Hello, Moritz. Thank you for the question. I am always hesitating a little bit what is one-off and what is regular business, but let's put it as extraordinary expenses, yeah? We have for sure currently this EUR 2 million extraordinary expenses for optimization the organization, mainly severance payments. Then we have the topic with installation costs and the movement to Czech, which might be all together, yeah, also in a bulk number, could be EUR 3 million. And then we have the topic that our consumer goods business was a little bit below last year, and it was below our internal expectations. That is the overall picture.
Good. Then, another question from Claudio De Ranieri from Albemarle Asset Management. He is basically saying that the range for Q4 is quite wide and the guidance, and as of today, do you see more likely the upper, mid, lower end of the range?
We will meet the guidance, would be my answer on that one.
Good. Another question from Stefan Eber from Deutsche Bank Investment. "What is the timeline for the North American business to start generating sustainable profitable results, and how much capital is required in order to finance this profitable growth?
Maybe the best answer for this one is our very detailed information we gave in the last capital markets webcast, which is on our investor relations site, where we explained in detail our strategy until 2030. Coming back now, the dip we have currently is following the geographical expansion, bringing the new people, bringing the new service technicians and sales guys. I am pretty optimistic that they will contribute positively in the next two quarters, or the individual persons will miss the toll gate, and then we will make a step back.
And maybe one last question from Alexander Galitsa, referring to the relocation to Czech Republic. He says, "You did mention EUR 2.6 million- EUR 2.7 million from personnel cost arbitrage, but what other benefits do you expect to reap?" I thought you were also targeting savings in logistics. Is it no longer the case?
Yeah. What we are also following, for example, if we have a higher purchasing volume now in the Czech Republic, it also makes sense to move part of our purchasing department and other indirect people to Czech Republic. We will start to purchase more from Eastern Europe for our Czech plant. That is also where we believe that on the long run, or mid or long run, that our cost structure will be better.
Then, with that was the last question. Thank you so far for all the questions you are giving us this time. With that, we come to the end, maybe.
Okay. No further questions. Then, ladies and gentlemen, thanks for attending. Thanks for the questions. Not only from myself, but on behalf of the whole management, I am really happy that you are interested in our company, and hope to see you or that you hear us soon in the near future. Thank you. Bye-bye.
Bye.