Operator: Good afternoon, ladies and gentlemen, and welcome to the Continental AG Analyst and Investor Call H1 Results 2025. [Operator Instructions] Let me now turn the floor over to your host, Max Westmeyer, Head of IR.

Max Westmeyer: Thank you very much, and welcome, everyone, to our Q2 2025 Results Presentation. I'm glad that we have a strong C-level presence here today again. Our CEO, Nikolai Setzer; our CFO, Olaf Schick; as well as Philipp von Hirschheydt, the future Automobile CEO. And for the Q&A, Roland Welzbacher will join us as well. Both the press release and presentation of today's call are available for download on our Investor Relations website. And as always, I'd like to remind everyone that this conference call is for investors and analysts only. If you do not belong to either of these groups, please kindly disconnect now. Following the presentation, we will conduct a Q&A session for sell-side analysts. To provide a chance for all to ask questions, we would like to ask you to limit yourself to no more than 3 questions each. This will help us to conclude our call on time. And before we start, let me remind you of some accounting technicalities that are also occurring in Q2. Due to the automobile spin- off in September, we applied for IFRS 5 accounting for continued and discontinued operations. As a result, among others, depreciation and amortization for automotive and contract manufacturing has been stopped. This has a significant positive effect on EBIT and net income. The EBIT effect amounts to EUR 235 million, equal to 240 basis points in automotive when looking at the Q2 adjusted EBIT. In the IR presentation, however, we are working with a like-for-like comparison, so still considering depreciation to reflect the operational performance of automotive. And of course, also KPIs like net income would have looked different if depreciation was not stopped. To make it easier for you to consider the subject of continued and discontinued operations in your models, we have provided a slide with pro forma comparative figures for all quarters of the previous year, or continued operations in the appendix to the presentation. You can find it on Page 26. And with this upfront, let me now finally hand over to you, Niko.

Nikolai Setzer: Thank you, Max. Warm welcome from my side. So we are looking back definitely to a very, very busy second quarter. On the one hand, the market and the operational effects, which has impacted us. On the other hand, we have reported on the ContiTech independence, which we are striving for the spin-off approval at the AGM. We have followed suit on the OSL transaction and finally in June 24, we had the Capital Markets Day, we have a lot of information. And we -- I want to use the opportunity to thank everybody. We had a high personal participation as well many joining in a hybrid mode. We have many road shows and conferences. And clearly, that shows how important the personal exchanges. We appreciate this, and we appreciate as well that you took the time in order to dive deep into our transformational story and from the feedback which we got it's now much, much better understood going forward. And with the second quarter, we want to add another piece of the puzzle going forward. This headline sum it pretty well up, we think. It's a resilient performance, which we have shown in a very highly volatile environment. Barely I've seen such a quarter where so many events on the macroeconomic base as well as it comes to currency and operational side. Good news is we are ready to spin off automobile. So you see on the right side, for all other transformation projects, we only have heads-up that we are fully on track. We are -- there is no obstacle driving our transformation forward. And in particular, our automobile listing in Frankfurt, we have now a date -- a targeted date which we can communicate September 18, which we are now working on. Looking on the organic sales, you could see on the left side that our sales were dropping from EUR 10 billion to EUR 9.6 billion. So heavyweight by the FX of north of 3%, 3.4%, mainly the U.S. dollar, but you barely find any currency in the world, which is not depreciating versus the euro where, unfortunately, our base, in particular on the tire side is mainly in euro, we have a high cost base in euro. So organically, with minus 0.4%, we're in very weak markets. We are somehow in the market, obviously being there rather flat. Automotive, the highlight significantly improved to the upper range of the guidance with 4%, and the profitability was driven by the commercial and operational efforts. So Philipp will give you more details later on. But in particular, you could see that the significant fixed cost reductions, which he and his team introduced already last year and the year before, they are really paying off now. And they contribute to a very reduced margin seasonality compared, not only prior year but the year before, so in the first half with 2.8%. We are within the guidance range, 2.5% to 2.4%, which we have not been in the year before, which is clearly a very positive as well a positive sign and proof point where the spin to happen September 18. Tires strongly hit by the FX as well as a strong FX headwind, same as we have on group more than 3% with substantial drop-through, which is the one half, which weighs on the profitability, the other half, as we have communicated before other tariffs with 2 months now with limited compensatory effect from Q3 onwards, that will improve and we are going forward. Important to mention that operationally, we haven't been okay. So we had a strong price mix north of 3%. Volume was given the market as well, okay, we could with our price mixes were compensated for a raw mat headwind but not for the FX and tariffs, which we are coming in. So as you could see, cut here, not effective yet, but the tariffs from Europe will drop from 25% for auto. And Paska tires are included in the auto category, not the truck and specialty, but we are mainly pass on our tire side. They will drop to 15%, which is good news. So this is built 15%, but it will reduce presumably our headwind in the second half by a mid-double-digit million amount versus what we have assumed before or still at the Capital Markets Day, what we have shown. The markets on tires, they have been muted in particular, Europe, APAC, North America, okay-ish. And for all markets, it is true that we have been at least within the market, at least if you look as well for local manufacturers. In Europe and North America and APAC, we have even slightly outperformed the market, which is a good sign going forward. ContiTech continued weak volumes on order as well as the industry. However, we have seen at least, we say only, but at least gradual signs, why only because we still hoped for more. ContiTech as well organically going backwards by 1.4%. Unfortunately, and headwinds, tariffs and FX, however, Philipp and the team, the other Philipp, continue working strongly on fixed cost management, and we could get most of the impact. So 4.8%, slightly below the lower point of our guidance. The lower corridor which translates into -- we have improved versus first quarter, 5.4% to 5.8% in the second half, we have to further improve going forward. For the group, you see in the right box, the like-for-like without IFRS 5, we end up with EUR 595 million, 6.2%. And if you add the sectors, you see that we have substantial group effects -- holding effects in the second quarter, which weighs on the results on the group level, which have been for the separation and spin-off activities, a high amount of one-offs, which we have absorbed here in the second quarter, and that might come as well then for the second half certain separation one-offs, which we will see another part, which will happen then in automotive, which will then be spun off on September 18. So net income, you see from EUR 305 million to EUR 506 million, also mentioned by Max, this is difficult to be compared number because it's not only depreciation, we have as well a hypothetical tax effect, so to say, to take an out if you do this, if you assume a flat tax rate the effect should be in the amount of EUR 180 million. So if you deduct this EUR 325 million is still higher than we had last year. So we moved forward as well on the net income. And you could see as well bottom down on the net indebtedness, we improved as well by about EUR 650 million. Adjusted free cash flow, we've been down in the second quarter, however, particularly for last year, you have to take into account that we had in the second quarter a high working capital effect or one-off effects on contract manufacturing, which is phasing out this year. And last year, we had those very positive effects, which not come again. They have been in an amount of low to mid triple-digit millions, so very significantly getting in. If you make the math of the first half, we are EUR 550 million ahead of prior year, which is given the market and given where we are a strong sign. So we are in line with the seasonal pattern on the first as well as on the second quarter, if you adjust for those effects, which we had. And of course, we had in the second quarter now, as we had in the P&L, we had restructuring effects on the one hand, on the other hand, the spin-off related assets, which I already mentioned, which [indiscernible]. So looking for equity ratio, Olaf will explain more. There are short-term technical impacts, which dilutes this, which will bounce back after spin, he will mention this more. And the leverage ratio on top, you see we further improved. I mean, net [ income ] is going down, EBITDA positive development that helps. And as mentioned on the Capital Markets Day, we will further, in the future, use this KPI instead of equity ratio going forward because we clearly believe that better reflects our ability to operationally finance our debt going forward. With that, let's move on to the next chart. So there, you see the second quarter in figures, we mentioned Group sales, minus 0.4%, so basically flattish, tires up based on the strong price mix, 1.4%. Automotive, roughly within the market slightly a little bit lower than the sales weighted market for us with minus 1.2% and ContiTech with minus 1.4%, again, more than EUR 80 million, which we could not on an operating leverage fully mitigated. But with the 5.8%, you see on the right side, sequential improvement, as I said. And if you look for the first half last year and this year, we are, despite being substantially down in sales, just 0.5 percentage point lower, which I said we have to recover and now further improve in the second half as well industry volumes come back, but further working on our cost measures. Tires at 12.0%. Here clearly, had mentioned FX and tariffs were hitting without the mitigation measures as well here, if you do the first half comparison as well here only because the first quarter, second quarter was flip flop. Last year, first quarter was weak. This year, it was stronger on tires. It's as well about 0.5 percentage point down given the effects which we have in the second quarter, which is clearly the trough looking for FX and tariffs, this is a good result, resilient result, as we mentioned before. And clearly, with that, I hand then over for the last time to Philipp von Hirschheydt. Last time under the Conti flag, I have to say, and as the CEO. I'll move you next time, you will wear another jersey with really a strong second quarter. Philipp, give us the details please.

Philipp von Hirschheydt:

Member of Executive Board for Automotive Group Sector: Yes. Thank you very much, Niko. And I'm also happy to be here and a warm welcome from my side. I'm glad to be on the call to give you some more details on what we have been working on and achieving in the second quarter on our way to independency on September 18, as Niko was mentioning. You can see that we had quite some challenges in the second quarter. Sales were down with clearly negative FX effects, although only a limited drop-through on profitability, as the light vehicle production was flat on a [ daily ] wages basis. However, the sustainable price agreements, which we secured in 2024 have provided a significant stronger base in the first quarter of 2025 that helped us. And the one-off pricing elements we achieved last year where we had a significant lower start to our commercial efforts and strong catch-up effects in quarter 2 to 4 are creating then tougher comparisons, which are going to weigh on this year sets out performance metrics in Q2. And that is specifically the case in Europe, I'm going to come to that in one of my further slides where we are talking about the regional sales performance. But briefly talking about the performance of the 4 business areas in the second quarter, and I have explained that already in the first quarter as well -- in the first quarter call as well as during the Capital Markets Day. We are heavily working on portfolio measures, which led to the fact that we phased out the build-to-print businesses, which you can see here in the Architecture Network Solutions results where we have a reduction in sales compared to last year that is primarily due to this phaseout of some specific projects. The core business is still developing quite well and quite nicely and in line with all the other business areas. At user experience, we do see now improvement as we already indicated in the Capital Market Day. We have on the one hand side price effects as well as some new launches in our new plant in Novi Sad in Serbia, which had to improve our sales and which also have then in terms of operating leverage. As you can see, safety and motion and autonomous mobility more or less stable. But more important for us, as we always mentioned, is profitability, where we made, as you can see on the right-hand side, a significant step into the right direction. There are still the need to improve. But in a very challenging market environment, we increased our operational results by 110 basis points compared to last year's second quarter. These are the main drivers for this strong development where the execution of our operational and commercial efforts, we are going to go into some more details. What we also achieved in the second quarter was a bigger onetime effect on the pricing side, which will not repeat in the coming quarters, but will help us as it is going to be a sustainable price improvement for the rest of the year. So to our 4% margin, basically, all business areas contributed, autonomous mobility was the second time this year around breakeven, which is a strong achievement compared to last year. And if we look at the H1 results, we can also see that -- and you might remember on the Capital Markets Day, we explained that we have the biggest challenge on the user experience side. Here, we made also significant steps forward and reached then the breakeven number in the first half of 2025. So a very encouraging result which sure will help us to move forward also in the next time to come. Another reason for our strong result is that the impact from tariffs is limited due to the fact that we produce in our majority in our Mexican plant, and we do have a very high share of USMCA compliant imports into the U.S. and negotiations with customers and suppliers for the parts where we have to pay tariffs are ongoing. And therefore, we do not see any material contribution to those additional costs from our customers in this quarter. But as we meanwhile agreed with most of the customers on reimbursements, this will then start to materialize from quarter 3 onwards. What we also did, we have been working on our fixed costs. Just one example. We have further reduced our headcount in R&D and this contributed then to a significant improvement of more than EUR 30 million of net R&D expenses although we were not able to repeat the high number of reimbursements of last year. So from a gross point of view, we made a significant step forward. And what we also achieved in quarter 2 is that the automotive free cash flow before interest and tax is despite the fact that we have quite significant outflows for restructuring and thanks to an improved operational performance, we are at around breakeven again. So also that huge improvement compared to 2024. So let's go into more details with regards to the transformational progress and -- thank you very much, Max. So you see here we are on our trajectory to make our overall infrastructure more and more competitive and to reduce our breakeven. We made, again, significant steps forward. We were always talking about that we have clearly find measures in the pipeline and more and more are now also ending in the bottom line, and we are going to see then even more improvements over the course of 2025 and then as well as in 2026. So what you see is on the left-hand side that we have reduced again in 2025, whereby more than 6,000 or by 6,000 employees, our organization and made them fit for future. You remember that we announced 2 years ago that we are wanting to reduce our SG&A costs by EUR 200 million 2024 and EUR 400 million in 2025. In the first half of 2025, we have already implemented EUR 150 million of that. So we are good for the EUR 200 million to come and we expect or we target at least to significantly overachieve also our initial goal and to get ourselves even fitter for future. We are already talking about R&D efficiency. We have reduced another 1,500 employees compared to the year-end 2024, and that will translate into an improvement of net R&D expenses adjusted for restructuring by around EUR 120 million in the first half of the year and that should last and also then should run then also into the second half. We are already mentioning on the A&S side that our portfolio management is well on track. We have done some smaller divestments. One we mentioned already end of last year, this is the [ zonal ] sales, which we have now retroactively taken out of our comp base, which made our adjusted EBIT 0.2 percentage points better on a like-for-like base. That means that we -- and what we target we execute, and this helps us to improve our overall profitability. I have already explained the stop of parts of the build-to-print businesses. We will also, therefore, the streamline operations. You have heard, and that's what we mentioned already during the Capital Market Day that we are intending to divest our Italian Drum Break business that's also very well on track, and we expect closing the fourth quarter of 2025. And this measure will have also immediate visible effects on our profitability. So we are working on getting our portfolio up and running and fit for future as said, so we are still working on some projects to be given back. So some impact on sales, you are also going to see over the course of quarter 3, where we have also ended and terminated some smaller projects. However, all that with a clear intention to have an immediate effect on our bottom line. So let's go to the next page where we explain the regional sales. And you can see here that in terms outperformance our picture changed this time for Europe. One reason is the phaseout of the build-to-print business at Architecture Network Solutions. And also we had last year in the second quarter, quite significant commercial effects means repricings, which led to a very high comp and in this year, we have been much more focusing on North America as well as in Asia, where we improved our commercial efforts -- improved our commercial effect. So the positive trend from Q1 persisted in North America. And as you can see also in China. In North America, our performance was mainly strengthened by an improved customer mix, but also by ramp-ups as well as a sizable onetime customer contribution. And in China, where we have been doing significantly better than the market, we have benefited particularly from launches of our MK C2 projects on that specifically with Chinese OEMs. So if we then come to the last page, which I'm presenting today, the Page #8, the order intake, you can also see here that we are on a good track. We have incoming orders of EUR 5.7 billion in the second quarter with a significant win -- again, significant wins on the autonomous mobility side, where we were able to have quite good awards for satellite cameras in the premium segment. We have also gotten orders from Chinese OEMs for long-range radars, not only from Chinese, but also from others, and we have also gotten a significant award and substantial ones for our commercial special vehicles unit, which we consolidate into the autonomous mobility area. And what you can see also here, not only we managed to ramp up new projects on the MK C2. We also getting new orders, new orders across the world, specifically in Asia and also from Chinese OEMs, and we also extend our presence on the suspension and airbag systems side. And architecture networking were also contributing with EUR 1.6 billion for TC, Telematic Control units as well as for several other gateways and light control solutions. So that's from our ContiAutomotive. Next time then automobile. And with that, I hand over back to Olaf.

Olaf Schick: Yes. Thank you Philipp. So I will continue with tires and Niko already highlighted that tires is significantly impacted by the highly volatile environment, substantial headwinds from FX and tariffs. Understating the strong operational performance of tires. Overall, volumes slightly declined mainly due to the continuing weak OE market and softer overall replacement demand in Europe. However, replacement markets in APAC and North America held up well and this development supports the mix effect in our EBIT, we managed to perform in line with the market or even slightly better in our key regions. We also see further stabilization in the European market for truck tires, both in OE and replacement segments but on a low level. North America, the truck tire replacement business benefited slightly from the continued weak performance of the truck OE business. So when we look at price/mix, we see good results of 3.2%, primarily driven by mix improvements. We benefited from regional trends, positive effects on sales channels and the continuous trend towards premium and ultra high- performance tires in our product portfolio. This development helped us at least to more than compensate for the raw material headwind in the mid-double-digit million euro area in Q2 as well as increases in fixed costs. However, this quarter results were severely affected by macroeconomic factors. In addition to the headwind from FX, profitability was significantly burdened by tariffs as our mitigation measures were unfolding with a delay as of mid-June. Overall, the net headwind from these 2 factors, FX and tariffs is in the low 3-digit million euro range and is distributed almost equally between tariffs and FX. The bigger picture despite a volatile market environment, profitability for H1 is only slightly below previous year's level. So that's actually strong signal of the operational performance of tires. So now let's look at ContiTech on the next page. Despite continuing weak volumes in the automotive and industry sectors, there are slight signs of improvement, as evidenced by a slight organic volume growth in our industry business. However, the trajectory of expected improvements remains uncertain. We need to see that. On a positive note, sales have stabilized quarter-over-quarter. The FX effects on sales were again negative from the limited opening to earnings our strict focus on fixed cost management and production performance on could not fully mitigate the impact of lower volumes year-over-year. However, we could achieve improvements versus the first quarter. And let's look at the free cash flow. The second quarter operational free cash flow generation was burdened by ongoing restructuring and spin-off efforts, you can see that. And if you look at the development versus the prior year, you need to consider that Q2 2024 was positively affected by one-off effects from changed payment terms and contract manufacture. So obviously, it didn't have this affects the second quarter of 2025. Since cash flow generation in Q2 seasonally tends to be rather neutral. We came out with a negative adjusted free cash flow due to the ongoing restructuring and spin-off as already mentioned, but also investment activities on the tire side. However, as Niko said that at the beginning, we achieved in the first half of 2025 free cash flow improvement over EUR 400 million compared to the prior year. Then I would like to address on the next page, more technical aspect concerning our balance sheet, you see only in this quarter. And that's the temporary drop in our equity ratio. So Continental's equity as per June 30, 2025 has been significantly reduced due to the reclassification of automobile equity into other short-term financial liabilities. This reflects the upcoming distribution of our mobile shares to our shareholders due to the spin-off. This liability position is not part of net debt. With the spin-off, the balance sheet total will be reduced significantly by asset held for sale. Assets held for sale amounted to EUR 18.1 billion in Q2. That means our total assets will basically be reduced by 50%. As stated at the Capital Markets Day, we expect a leverage ratio of around 2x after the spin-off and all KPI targets mentioned at our Capital Market Day of course, remain relative that means also an equity ratio of above 30% that we target for. Now let's look at our -- the market outlook. Light vehicle production in North America has proven to be quite resilient so far. As a result, the expectations have also improved after 2 months of tariffs being effective. Therefore, we raised our North America LBP expectations for 2025 to a range of minus 5% to minus 3%, expectations for Chinese vehicle production has also improved in total in respect to flat vehicle production worldwide, also for commercial vehicle production was significantly worsened in particular, in North America. Our assumptions regarding the tire replacement market and industry production did not change. Okay. If you look at our guidance, we have announced and adjusted our guidance at the Capital Markets Day. We are now confirming this guidance with the reduced tariffs mitigation measures taking effect. We are now expecting limit double-digit million lower headwind in the second half for both [indiscernible] and the group. Furthermore, we still guide for negative special effects of around EUR [ 350 ] million. This does not include the deconsolidation effects in connection with the plant spin. Although our free cash flow guidance has not changed. Let me give you a short summary of how the extraordinary negative effects expected for the full year 2025 are distributed across the group sectors based on the free cash flow bridge that we have provided to you in March when we presented the financial year 2024 figures and we gave an outlook. Everything said so far in that regard and what we said back then is still valid. Most of the cash outflows for restructuring are attributable to automotive and only smaller portion is [indiscernible]. Payments in connection with the spinoff will be primarily born by automotive. This includes costs in connection with the listing, IT separation and branding. The part remaining with Continental is mainly related to IT separation. Regarding the tax effects, it is too early to share any more details, but certainly both automotive and Continental will have to bear a part of the spin-off related taxes and we named them to the magnitude before. A major part of all spinoff-related costs will accrue still in 2025. With that, we come to the end of our presentation.

Nikolai Setzer: Yes. Thank you, Olaf. Before we are jumping now into the Q&A, I want to jump in because -- this is today, I mentioned this at the beginning, already when I hand it over to Philipp, a historical analyst and investors call because it's the last one with automotive, and it's the last one with 2 individuals with our CFO, Olaf Schick and with Philipp von Hirschheydt, which will both then leave basically at the same time at the September time frame, and they leave the jersey of Continental, as I mentioned, before. So by no means, as we are now 5th of August, this is a good bye because there are still ways to go. And you know me until the last breath, you wear the Conti jersey we are fully convinced that you contribute. However, it's a recognition to your strong contribution and performances. And I think everybody has seen the proof. We're on track with our transformational parts, which have been strongly supported and pushed by Olaf. And automotive, you could see we are now on a way where we can say sustainably, we have an automotive sector, which can develop as an own entity much better than within Conti and has everything which is needed in order to be successful going forward. So the champions, the 3 plus 1, as we said, they are on track. So thanks to you both for your contribution in the past and please don't forget to invest everything to have a strong listing on September 18 and drive our other projects forward, which I have no doubt you will do. And at the same time, I mentioned at the beginning, Max, we have the future CFO. So Roland will take over the helm of Olaf once he's leaving. He is as well already on the call, and he is then able to answer in particular, obviously, the tire questions as he's the CFO of tires already now and will be in the future. So with that, I hand over to the operator to open the Q&A. Thank you.

Operator: [Operator Instructions] And the first question is from Christoph Laskawi, Deutsche Bank.

Christoph Laskawi: The first one -- and sorry for bringing back the unpleasant topic, but it seems like the discussions with BMW are turning into a lawsuit. Is it right to assume that this potential liability will be passed on to our mobile, and that's it with [indiscernible] as we've seen with Vitesco. And could you just share your thoughts on the timeline of this potential lawsuit and what we should expect from it? Then the second question would be on tires and the tariff relief and how that will be phasing in the second half. Is it right to assume that the high drop-through on FX will probably stay unchanged also in Q3, Q4, but the mitigation measures are coming through with July and then obviously, the tariff cut from August 1 onwards, so that we could even see in Q3 already 1 percentage point margin step- up from the mitigation and the relief? And then the last question would be just on the free cash flow in Q2. Could you quantify the restructuring cash out and the spin-off cash out that was impacting that number?

Olaf Schick: Yes, I will start -- Olaf here. I will start with the first question on the great topic with BMW. As you know, we supply BMW at a lower MK C2 so the latest integrated brake system, which is installed in various models by BMW. We still have different leading positions regarding the previous warranty case, and both our customer BMW and also Continental filed a lawsuit a few days ago. Look, that's something that you in such a phase of where you have different legal positions that you secure legal positions in this way, that's actually not unusual. Nevertheless, we believe it's still possible and actually desirable to continue the talks of BMW and then -- and we will -- everything else we discuss with BMW, we will continue that dialogue. And also, you saw that in Philipp's presentation, it's important, right? This MK C2 brake technology is well accepted in the market. We received new orders also in the second quarter also from China, as you saw on the presentation. Our provision is still correct, as they confirm our provision as of today. The situation going forward will remain with automobile. The spinoff basically will not be affected by these proceedings, but this is, content-wise, an automobile topic, but you cannot compare that actually with the Vitesco scenario where you have a kind of proceedings by authority. So that's very different. So it's difficult to make an analogy.

Max Westmeyer: Yes. Do you want to take the restructuring and spin-off related question as well?

Olaf Schick: Yes. Then I take your third question as well. Restructuring spin-off cash-outs in Q1 and in Q2, we had each low triple-digit million euro amount of payouts. So that means in the first half of the year, this was a low to mid triple-digit million euro amount that we had.

Roland Welzbacher: Hello, everyone, Roland speaking, and thanks for the question, Christoph, that was the obvious one. So let me start to answer this. But looking back at Q1. So we lost versus -- sorry, to Q2, we lost versus last year Q2, around about EUR 100 million adjusted EBIT, and that was basically all about tariffs and FX and without that effect, we would have been close to EUR 500 million. Now going into the second half, what we expect on the tariff side, first of all, that we get some relief from the adjustment made on the tariff scheme going down to 25% to 15%, hopefully, for PLT hopefully, pretty fast. And then our mitigation will become fully effective, so there will be a big relief in what we expect then for the full year still for the second half to have an impact on low to mid euro million additional costs versus the status before. On the FX side, we have a pretty high drop at 50% in Q2. We expect a similar drop 40% to 50% in H2. If you remember, the U.S. dollar rate was at 104 at the beginning of compared the peak was in July 18. If it stays around about 1.15 then we expect north of EUR 100 million additional burden for the second half of the year.

Operator: The next question is from Jose Asumendi, JPMorgan.

José Maria Asumendi: Full agree Niko, unprecedented incredible times at Continental, the changes we're seeing are incredible in the context on the history of the company. Certainly very, very interesting times. And I fully agree. This will empower both companies to deliver better results. A couple of questions. And obviously, wishing all the very best to to everyone in your roles. Can you comment a bit, please, on cash generation, maybe second half to the first half? And if you could provide the color within tire and auto, expectations for the full year and specifically, how do we think about many a little bit the second half? Second, can you comment on auto. Any more color, please, around the subdivisions within it or which of the divisions will be the biggest beneficiaries of the cost-cutting actions you're taking in '25 and '26? And then three, business wins you booked in the first half or second quarter within auto, anything you will highlight, which is driving the growth of the company within the auto sites?

Olaf Schick: Jose, good to hear you. Look, we still have a -- I mean, if we look at auto and Philipp can then add the cash performance in the first half of the year was quite strong. Still, you still have the seasonality of the business going forward, right? So we expect -- also was before interest and taxes basically breakeven a strong cash performance in the second half of the year. For tires, we had, let's say, second quarter was impacted also by, let's say, investments in tire production facilities in the U.S. and in Asia. We had a good start of the winter tire business already. So second half of the year, we see the strong seasonality of that business. So we expect a strong cash flow performance in the second half of the year.

Philipp von Hirschheydt:

Member of Executive Board for Automotive Group Sector: Okay. Let me add to that, Jose, yes. So with regards to automobile in the second half, I mean, I explained that we have been basically breakeven in the first half, and we expect also in the second half to be above the breakeven line. As you, as Olaf already also said for us, it's also valid that we do have normally a stronger second half than first half. So we expect that we are able to, let's say, bear the additional separation costs, which Olaf was mentioning, but -- and we will still be breakeven or even better than on the free cash flow side in the second half of 2025. And then we expect that this is then also rolling then into the next quarters and years to come. From a subdivisional point of view or business areas, how we call them, who are the biggest beneficiaries? We do the major part of our programs across all business areas. So in general, all business areas should and will benefit from our measures, being at the R&D side and being it on the SG&A side. But as you might imagine, we have been showing that we had in 2024 on the user experience side, a negative return on sales of 4.8%. So we expect that we do make the biggest step forward there, as we explained there, that we do have measures in place. We have been in the first half already breakeven. So this will make the biggest jump, whereas each and every business area, media business area need to contribute by reducing costs and adjusting the infrastructure towards the sales volume and towards better drop through and better operating leverage going forward and making the breakeven point significantly lower than in the past years. We have formed a -- coming to your third question and the question of what are the main achievements, which we managed in new orders. I think what we do see already for quite some quarters is that our MK C2, our integrated brake system is a very appreciated technology -- technologic step forward. So we have around the world, new orders for this specific product, which I think shows the let's say, the breakthrough which we have achieved there. And we also see that on the autonomous mobility side, we make a big step forward, which should then turn on the outer years of this decade to quite positive sales. And if we look into the Architecture Network Solutions area, we -- and that's what we tried to explain in the Capital Markets Day is that whatever technological step forward is going to come, we are well prepared because we have products there for the entire product life cycle and that's what you see. You see consistent and continuous orders coming in for existing projects -- products, but also then for new ones being it on the telematics side, being it on many other areas. So we are quite happy with the projects which we gained, where we expect then also more order intake in the second half is on the user experience side, where we are currently more focusing on making that business breakeven, but that we then will also see additional orders going to flow into Q3 and Q4.

Operator: And the next question is from Ross MacDonald, Citi.

Ross Alexander MacDonald: Hopefully, you can hear me. I had 3 questions, I think, fairly simple questions. First one, just on tires. One of your competitors actually lifted their price mix assumptions for the full year, last week. It would be helpful to understand, I think, how you see price mix tracking in the second half relative to that 3.2% in Q2. And then maybe any comments linked to that on volume assumptions into the second half for tires, given you're putting pricing through, but we should also potentially have some restock on the winter tire side. So the first question there on tires. Secondly, on automotive, it sounded like the margin -- the sequencing of margins into the second half may be slightly lower from the 4% you printed in Q2? Just be interested in understanding in the guidance range, which is quite wide at 2.5% to 4%. I don't know if you can give any color on where you think second half automotive margins appear to be tracking at this time? And then finally, just on the OES sale, I saw a headline that you expect that to be wrapped up in Q3. Any comments in terms of likely timing and cash-in impacts could be helpful, I think.

Olaf Schick: Yes. So let me start with the tire side, and start for the volumes. So we expect a slightly higher volume in H2 than it used to be in H1. We expect soft market environment to continue with just one exception we get more orders now for the truck tire OE business in Europe. And if we quickly remind ourselves the start into the [indiscernible] season has started with a strong order intake but we also have tough comps because we've also already had a very strong second half last year. So against this, we expect a slight increase in volume. . If we look at price/mix, so the 3.2% in sales dropped down at a rather high rate of higher than 80%. We expect this to continue. So a very rich mix in the second half price only drops down to a limited rate because, obviously, this is also meant to mitigate the tariff impact. But nevertheless, we had a very strong price/mix effect in our EBIT in Q2 and we continue -- we see this to continue into H2.

Philipp von Hirschheydt:

Member of Executive Board for Automotive Group Sector: Okay. Then I add on with the question towards -- across towards automotive. And yes, we have had a good first half with 2.8%, which is in our guidance. And we expect -- as we said, we confirm our guidance for the rest of the year. I mean, there is a lot of uncertainty out there in the market. I mean, as the first -- or the second quarter was already quite instable of overall macroeconomic environment, we expect that -- or I mean, who knows what's going to happen in the second half, specifically on our side. So we are confident that we are on a very good trip, and we are satisfied with the improvements we are doing, but we think that any adjustment of our guidance can and will only be done after we have been spun off and are going to be independent. And then based on the parameter of automobile, we will look at it and might get back to you.

Nikolai Setzer: And Ross, on the question, as I mentioned at the beginning, we are still fully on track. So obviously, which we said in the past is still valid. We are moving forward, and we are confident to conclude this transaction, still in the second half of this year. And your question of any impact from the start, we said that you should not expect any specific cash impact for us. The clear idea of the [indiscernible] transaction is making out of the ContiTech in strong industry champion that's why we carved out OSL and we bring it to the market, we are clearly convinced that the new owner performs stronger on OSL than we can do it within ContiTech or within Continental. That tells you in the current environment the impact on the cash side is minor and will not have any influence on the cash flow or the other results.

Operator: At the moment, there seem to be no further questions. [Operator Instructions] And we have one more question from Horst Schneider, Bank of America.

Horst Schneider: One leg already in holidays. But just small ones on tires. Can you maybe quantify the negative raw mat effect in Q2 and provide an outlook for the second half? And also, can you same then also quantify maybe the FX drop through that you have seen in the second quarter?

Olaf Schick: Let me start with the fixed drop. So it used to be between 40% and 50% in Q2, and this is actually what we're also expecting in the second half, as I already said. On the raw mat side, Obviously, in Q2, that was still a drag on our EBIT and this will then turn around in Q3. So we already expect pretty neutral effect in Q3 and a slightly positive effect than in Q4, which makes H2 slightly positive.

Horst Schneider: Maybe small add-on for automotive. Philipp, can you elaborate now on the chances that you can achieve this in automobile than for the full year, the upper end of the guidance range? And what speaks against this assumption? You alluded on the -- at the CMD to this weaker Q3 that was clarified in the preclose call. So maybe an update on the H2 outlook and why automobile shouldn't achieve the upper end of the guidance range?

Philipp von Hirschheydt:

Member of Executive Board for Automotive Group Sector: Yes. We have -- as I just explained, we do see still a lot of uncertainty in the market, and we have not yet drawn a clear conclusion of how sales are going to develop. We feel very comfortable within the guidance range, which we have been given, both on the sales as well as on the on the EBIT guidance. However, to now come to conclusion that we can change the guidance and guide towards any other direction. We do think that is too early. And as I said, we -- if so, we would need to do that going forward as then the automobile perimeter. So we are still -- we feel comfortable where we stand, but we feel not yet comfortable to change the guidance into any direction.

Nikolai Setzer: And all the best for your second leg in the holidays, Horst.

Operator: And we have one follow-up question from Ross MacDonald, Citi.

Ross Alexander MacDonald: Sorry for the delay there. Yes, given, I think, plenty of analysts on holiday, I'll jump in with a couple more. Just interested, Philipp, on the automotive side, on Slide 7, the regional performance trends. Obviously, quite unlike your EU peers, you're actually outperforming in China in the quarter. Could you maybe speak to how much of that is one-off in nature? I think you talked about some one-offs in U.S. or whether you expect to be outperforming in China in the second half? And then I guess linked to that, maybe if you could update for the broader regions, how you expect full year performance to track relative to the S&P Forecasts?

Philipp von Hirschheydt:

Member of Executive Board for Automotive Group Sector: Yes. I mean with regards to China, we do see, and that's what we always said, we do have a quite solid business in China, and we have some very successful customers on the Chinese OEM side, which we are growing quite significantly with. We had -- that we also need to say we had a very low comp of last year. That's why in the first half, it was actually easier to outperform than it's going to be on the second half. However, we do see that we have said with also with new order intake, which is fully in line with the overall order intake of automotive we do have quite good inflow, and we do see quite some chances in the market there. We are working heavily on making our organization even more robust and resilient and taking out costs there as well. So that is not a user experience related topic, it's more on the safety and motion side where we have been gaining quite some businesses in China and where we have been doing better in the first half and in the second quarter. On the North America side, we also see good improvement. And on the European side, actually, this is where we have most of our portfolio measures implemented, where we have businesses which do not fulfill our profitability expectations. That's why we foresee also going forward that we are not going to outperform the European market as much as we have been doing so in the past. I hope this answers your question, Ross?

Olaf Schick: I do think so. He stepped out of the line already.

Operator: And as this was the last question from the audience, I will hand back for closing remarks.

Max Westmeyer: Yes. Thank you very much, and thanks, everyone, for participating in today's call. I hope you have a well-deserved break ahead of you. But of course, if you have any questions as a follow-up, the Conti IR team is very happily available for you guys. And with that, I would like to conclude today's call. Thank you very much, and goodbye.