When analyzing company financial health, investors should examine multiple factors including revenue growth rates, operating cash flow, debt levels, and valuation metrics like P/E ratio and EV/EBITDA. Companies with flat or declining revenue (like Nagarro's 0.5% growth) face significant valuation challenges, as growth is essential for multiple expansion. Strong operating cash flow is critical for funding dividends, buybacks, and acquisitions. Companies with high debt relative to earnings (like Nagarro's 1.9x net debt/EBITDA) carry bankruptcy risk. Understanding these fundamentals helps investors assess whether a company is truly undervalued or simply struggling with structural issues.
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✅Resultados NAGARRO Q1: ¿Hundimiento o Resurrección?追加:
Hello everyone, here we are at 6:30 in the afternoon, which means momentum, another Sunday together and today we have a program where we are going to talk about three companies that people follow a lot.
We have Nagarro, which presented results on Friday, which is not the most normal thing, but in Nagarro it is normal. Uh, and we also have the results from both CASPI, first quarter results, and Centra, which didn't just present results, but also presented the 2025 annual report. What happened is that they finished the Strategic Review and that's it, the company isn't being sold, so the company is going to continue. I met with Afentra's management on Friday and I have a couple of things to share about it, okay? So, that's what we're going to talk about now. So first of all, let's start with the disclaimer as always, and hey, we're already at full speed. Feel free to leave comments about anything you'd like to say here, because today we have three very important companies to talk about, so let's get started, okay? So, the disclaimer, as always, is that nothing we say here is a recommendation to buy or sell any type of financial asset, or to be long or short in any company. So, as we always say, do your own analysis to invest in what you consider most appropriate. And I can already see Diego Quijada here, who is the earliest riser, saying to us, "Good afternoon. Leaving a preemptive like." Well, I like to say that I left the first comment yesterday, saying that I was really looking forward to today's program, which is very true. And by the way, one thing to say, a comment here, eh Tebas. I think Tebas clearly knows I support Florentino and just to spite Momentum he's scheduled most of today's matches for 7 pm, but oh well, I hope that given the low quality of the Spanish League and how uninteresting it is, I hope people will spend their time watching us instead of watching football, okay? And you're leaving, just so you know, I caught you, I caught you here, the license plate. Okay? Josem 928 tells us, "Teleperformance, what a rebound it has." The truth is that it has a very strong rebound. Obviously, it's a stock that had been falling significantly over the past 12 months. It had actually been down for quite some time and lately it has had a very strong rebound. Yes, exactly, José. And that's what often happens with these types of companies; when they fall so much, the rebounds are very strong. Let's see if it continues. Obviously I would be very happy for the people who wear it, okay? And Antonio Morales tells us, "What's happening in Nagarro is torture. They say I'm getting out and I'm already recovering.
Get out as soon as possible." Well, I don't see it that way either. In other words, we shouldn't tell people to run away or not to run away, and so on. Well, it's clear that this sector is currently in the situation it's in. It's not just a Navarro issue, it's an issue for the whole sector, although it was interesting because on Friday Globan had a pretty strong rise which I actually think helped Nagarro in the last part of the session to do better, right? Nagarro had been going down, I don't know if the maximum it went down was 6 or 7 or 8% during the session, then it stayed at a 3 or 4% drop and in the end it finished slightly positive. I think it's partly because Global went up quite a bit. I don't remember how Globan closed, I don't know if it closed up 10-12%, but at times it reached 17%. But as I said, Antonio, it's an issue for the whole sector, it's not just a Nagarro issue.
In fact, as we saw in other programs, Nagarro had dropped less than the rest, curiously enough.
Taxi Rivadeo tells us, "Good afternoon, a great show is coming up, greetings." Well, we send our regards to you and your wife, and I hope to see you. Please confirm. I hope to see you in September at the Momentum event here in Andorra, which, as you know, makes me very happy. When I know that you and your wife are coming by car from Ribadeo, crossing the entire Cantabrian mountain range to come to Torra, you know it always makes me very happy, okay? So I hope this year will be similar.
Okay, let's get on with the program. But first, this is what Manas tells us, not me saying it, Manas says it. He says, "A like to Momentum is more disruptive than AI in Nagarro."
Okay, so if Manas says so, I think it's a moral obligation to give it a like, because today there's a show that really deserves that like. Okay?
So, before we talk about Navarro, let's go over what I call the club's gems, which is bringing video content that I bring to the club. I bring some of the content and talk about it here, okay?
Okay, let's see, uh, focus. Here you see the very elegant Paul McDate, who is the CEO of the company. I met with him on Friday.
We had a meeting on Friday, they released news, if I remember correctly, I think it was Tuesday or Wednesday and I said to him, "Hey, let's see when we can sit down." I don't know what. We sat down on Friday and the truth is that, uh, as far as facts and details go, it was a meeting that was supposed to be between half an hour and an hour, and I spoke with him for an hour and 20 minutes and I made a video for the club, which I made yesterday, Saturday, and the video for the club that I said, "Okay, it will be a video of 20 minutes, 30 minutes and so on," in the end the video was 55 minutes talking about absolutely all the details of Acentra. Okay, this is the cover of the video I made for the club, and then we start here with some stuff. Um, to give you an idea, I think the club video was about 35, almost 40 slides, no, maybe not that many, but 30, 35 slides, maybe I'll bring you like five, seven here, okay? Uh, regarding the strategic review, which was the first thing I asked him about, he told me when it started, at what point in time it began in 2025, and one of the reasons is that they saw that in Angola the prices being paid for assets, especially taking the 2P reserves as a reference, were much higher than the price at which Afentra was trading at that time.
This, in a way, led them to conduct that study which multiplied A Fentra's proven reserves, and with that information, it was presented to the board at the end of 2025. Okay?
So, based on that, the decision was made to do that strategic review and see if there was anyone who could highlight the current situation we have of the company. There were a number of companies that were in this Strategic Review process and there were several bids that were submitted. We don't know the price at which these offers were presented, but what we do know, or what I was told, is that the main concern of those who were bidding was that they would overpay due to the rise in the price of oil because of the war, which obviously led to a rise in the stock price, right? So, in the end, if you think about it mentally, if the stock was at 40 pence, paying 60 or 70 pence is a very big reward, but when the stock is already at 70 or 80 pence, to get the company you have to pay at least 1 pound or a pound and a bit. So, in the end, all those companies that were involved in the process were afraid of taking advantage of the situation where the stock had risen due to the Idan issue and that they were overpaying. But this is over, there is no more strategic review, the company will move forward.
So, I focused a lot in the conversation I had with them on, let's see what's going to happen and let's look at every detail of what we have in the next few months, okay? I'm going to bring you, there are two drills, as you know, we have the drill at Pacasa Southwest, which is the one they are doing right now. That drill is fundamental, I would say. Let's see what happens with that drill. We'll have results in a few weeks. I didn't bring that here today. I 've explained everything in great detail at the club. That drill is much more important than this one from Impala in this case. And regarding the drill at Impala, the success rate here is practically 100%. What does this mean? It means that in that area they know there is oil, they know there is petroleum. The question is, how much oil is there and how much can they extract?
So, the risk of a dryall here is practically zero, practically nil. And the question is, once they drill the well, how much oil can they extract from that drill? OK? The cost of doing it will be between 50 and 60 million dollars. So, it must be remembered that based on the agreement reached not only by Fentra, but also by Morel, that is, the whole bloc with Sonangol, Sonangol is the one providing that RIC to do it and is the one assuming the risk. So if any of the drills go wrong, the cost to center is zero. But if the drilling goes well, the way it works is that all the initial oil extracted will go towards paying for the drilling itself, these 50 to 60 million dollars that I'm putting here. And then once the drilling is paid for, all that additional oil that we're extracting because of the drilling obviously goes to all the partners in the block, okay? So, this is a little bit how this issue is going to work for the Impara drill and as I say also for the Pacasa Southwest drill, which for me, in my opinion, is what is fundamental and is what can change the company at least in the short term. Okay?
Then we have the famous ones with CON, which is the onsor part. The interesting part for people who aren't so involved in the whole oil thing is basically, uh, oil wells that are on land.
Offsore are in the middle of the sea and onsore are on land. So, right now we're participating in three licenses: with four, with 15, and with 19. Okay, the first important thing to mention is that the one with 15 and the one with 19 have already been approved; we are officially part of that license.
We have 45% in both and we are not operators. In Con 4 we have 35, but we are operators, but that has not been approved. We are waiting for government approval, and that approval is expected this summer, that is, in the coming months.
We hope that in the summer months they will finally give us the approval for the fourth bullet point.
One thing they told me within the company, and I'll put it here, is the fourth bullet point that I found very interesting: there are no small cup oil fields with this level of exploration potential. There is no small cap of oil today that has as much exploration potential as Afentra. So, this is very important because Afentra is not just a company that, once the ETU deal is closed, we'll see later, is producing 7,000 barrels, 7,000 barrels per day, but it is a company with very large exploration potential. We have offshore exploration potential, we'll see about that later, and we have huge exploration potential here in Onsor with four, 15 and 19. The thing is, things move slowly in government, this is going to be slow, it's going to take some time for this to become fully realized. OK? And one very interesting thing is that the market is currently valuing this at absolutely zero. And the last point that I find quite interesting regarding how much they expect to spend in the next 12 months, just the onshore exploration part is about 5 million dollars approximately.
By the way, if anyone has any questions about Afentra, please post them because I'll answer them before moving on to the next part about Caspian, okay?
The acquisition of ETU, we're talking about here. In fact, I really like this table because it says it all. The first deal we made was with the INA part, then Sonangol when they sold us a part, the blue part and the ETU part. So this shows our evolution within that block 305 which is the one we are linked to and where we are extracting the oil.
OK? Uh, the acquisition of ETU, to give you an idea, look, would increase our net barrels for A Centra from 6,300 to 7,035. Okay, to give you an idea, it's going from 30% to 33.33%.
So, regarding this deal, it's expected to close at the end of June, still in Q2, but honestly, this is Angola. In other words, I wouldn't be surprised if this went to the beginning of July, but let's see, let's wait until the end of June and even then, this is a point where it's a bureaucratic procedure. I'm not particularly worried because Sonangol is already taking a cut, so the risk of this not going ahead is very low for me. OK? So this is on its way and we'll have news soon. If it's not at the end of June, it will be, I would say, the first half of July.
Okay, block 324, what's special about block 324? Well, block 324 is a block that is very close next to block 305, which is a block that we obviously know very well.
So, there are quite a few of these types of blocks in Angola, where they have the following particularity. There is an exploration risk because those blocks have not had oil extracted for a long time and we have to see if it can really be extracted as it was done before; sometimes it's not 10 years, sometimes it's 30 or even 50 years that oil has not been extracted, but they are very close to existing infrastructure.
That's very important because you do n't have to create the infrastructure because you have it right next door; you simply have, so to speak, the exploratory risk. So, what they told us about this is that the FID will be done in Q4 of 2026. For those who don't know what an FID is, FID stands for Final Investment Decision, which is the moment when the company officially approves a project, usually worth many millions, and then we allocate a budget and give the green light to both the construction and execution phases. This is going to happen in the last quarter of 2026, at the end of this year, and it is expected that, if everything goes well, the first oil we can extract from this block 324 will be at the end of 2027, that is, practically 12 months, practically a year, where we will be working in this block to extract the oil. Why am I bringing it here? Why is it relevant? Because here we are operators, it will be the first time we demonstrate Fentra's capacity as an operator and not just as a partner in a block.
Secondly, here we have 40%, we have a higher percentage, for example, than we have in 0305 and therefore more of what happens here will affect us and that's good. Furthermore, a very important point is that the fiscal conditions in this block 324, precisely because there is an exploration component, are better than those we have, for example, in block 305. So, what does this mean? If everything goes well, we keep 40%, but also, with better taxation per barrel, we keep considerably more money.
OK? So, by the end of 2027 we will have the results of this. And the truth is that there is a very large potential and notice that they themselves speak here of about 10,000 barrels in this project, which is what is expected to be extracted. Sure, if 10,000 barrels are extracted, we get 40%, that's 4,000 barrels for us. And don't forget that we are currently producing 7,000 barrels, so it's very significant. Okay?
Okay, the issue of the oftake, which I find very interesting because the oftake used to be done by Trafigura because it was linked to Trafigura giving us the debt. OK? Now, uh, the Oftake is done for us by the company that in turn gave us all the new debt. So, there's a pretty interesting part here, which is that the fees they charged us for doing the offtake have clearly decreased. It's not just that the debt has decreased, which we'll see now, but the fees for the offtake itself have clearly decreased compared to those of Trafigura. Let's say that now they are on the market and before we paid more because it was also linked to that financing that another figure gave us. OK? So I'll just leave it there as a reference.
And the hedging aspect is something I saw in detail with them. As you can see, I've put Hedgin 3 here; this is a slide of my own making for the club. I'm not bringing you part one and part two, but simply for educational purposes I'm bringing you a part that I find very interesting, which is what's called a three-way strategy in oil, in hedging, okay? Because one of the things I talked about regarding current coverage was what alternatives they had considered, and they told me that one of them was a three-way coverage.
So, for those who don't know, I'm bringing it up here, and that's also a way to learn more, okay?
So, a threeway hedge in oil companies is a derivatives strategy that is a threeway tail.
So, here we have three options: a put that we buy, a call that we sell, and a put that we sell but lower than the put that we bought to set the protection ranges. So, how does this work? The first step is to buy the put, which establishes the floor, setting the guaranteed minimum price. Basically, if the price drops below those levels, the put option protects you and you keep the put level, okay? From the money they give you.
Then you sell a cabbage, which sets the maximum. This would affect a traditional strainer. What does this mean?
If oil is up, the problem is that you're stuck with the price of that cabbage, so to speak. But what it has, that would be a traditional necklace. The thing about a threeway colar is that you sell a second put further down. So, if you had this floor, you sell a [ __ ] one and what you create is, so to speak, a kind of subsoil. So if the price of crude oil falls below that lower level you set, then you are the one who covers that hedge. So, I'm going to show you with the numbers we have here so you can understand them. Imagine we create a put option at 55 and a collateral at 65. I'm going to give you some prices so you understand, okay?
Oil is at 90. So if oil is at 90, Fentra takes 65 because that's what he has here in the cabbage, in that C he made at 65. If oil is between 55 and 65, let's say 60, Fentra takes 60. If oil is below 55, let's say at 50, Fentra takes 55 because that's the land he has. However, since we created this three-way agreement with this 40 put option, the problem is that if oil were to fall below 40, it would be F Centra who would assume that risk. It wouldn't cover you from age 55 because the 40-year-old's would be canceled out by the 55-year-old's, and we would bear the risk.
OK? So, this is a threeway colar, uh, or a threeway as it's called in the business, and since these are things that perhaps you haven't heard of, well, I'm bringing it to you.
Well, for informational purposes, this is one of the things they studied doing, but ultimately didn't do.
OK?
And here I outline the differences between the various strategies. A put, simply buy a put, which means you buy that floor and you have the whole app. What's the problem here? that you have a high premium cost.
Why is a ceiling built where you have a floor but also a roof?
Because you get paid for the roof, and with the money you get from that roof you pay for the courier. So, many times it's what's called a costless collar where there is no cost. One goes with the other and you're simply left in the middle range. And then there's the threeway collar, where since you're selling an additional [ __ ] they give you more money, but you have the risk that if the oil price were to plummet, you'd be stuck with that part. OK?
And then there's the part about refinancing the debt that I mentioned to you with Gumbard. I thought this was a very good move by the company. To give you an idea, these are the old debt terms they had. It was a 3-month SOFR plus 8% interest. Now the new terms are plus 6% interest. We're talking about a drop from +8% to +6%, which is very, very significant. So how does this work? It's 100 million that they give us in 2026. You can see it here in the graph I'm posting. And an additional 25,000,000 in 2027, which in this case is from July 2027, that is, the second part of the year 2027 would give us an additional 25 million if we want them.
There are 12 months, that is, from when we take on the debt in June until June of next year, where we do not pay the principal, we would only pay the interest. These interest payments are made quarterly. This is great, not having to pay the principal for 12 months and only the interest portion. And then a point I'd like to make here that I think is very relevant, which is that it gives us much more freedom because before, the RBL was only linked to the asset.
In other words, if we made a purchase, we couldn't use the money we had here to pay for, for example, that purchase. The good thing we have here is that these 100,000,000 plus the 25 they can give us in 2027 can be used for anything, okay? So if we have, for example, an acquisition and we need 50 million, we could draw from here. So in that sense, it's not just that we pay less interest, we have much more flexibility, but we also have much more freedom in how we spend that money. OK?
Okay, now let's talk about my opinion on what I think about the call I had with them and the overall situation at Afentra.
I believe that, based on the overall impact of the entire onsor part, the market currently values this at zero, but I think there is great potential. In fact, we see it in Corcel.
Corcel rose a lot at times and Corcel at the bottom has those exploratory rights in some of the CONs.
We have three cons, and be warned, who knows if more cons might arrive in the short term. So, that's now valued at zero for Fentra, but it has very, very big potential. Then there's also the 324, which I think the market isn't valuing at all, but I think about this, especially since it's true that there's an exploration risk that needs to be taken into account, but I don't think it's that big simply because oil was already being extracted from here 20 or 30 years ago. In other words, the oil is there.
OK? So, I think of the 324 as a kind of net acquisition of 2,000 or 4,000 barrels for the company that will be in place by the end of 2027. Now it seems very far away, but when you realize it and it's Christmas 2026, it's going to be closer to us and we just have to keep it in mind.
The company isn't going to change now, but it's something that, for me, deserves some value, however small.
OK? Be careful with the home drill. Let's see what's going on there. I spoke about this in great detail at the club because it's fundamental; it's very important information that I brought there to the club, but if it goes well, I'll leave it at that. A lot of courage is going to surface.
OK?
And regarding the company, I think they have opted for organic growth and this means cost. Money needs to be invested to make it happen, but above all, it takes time. These are things that take a lot of time, and time means patience, time to get things done, and time to be invested in the action and see how value is created. Some people have it and some people don't. OK? Well, if you ask me about the current situation with all the strategic review and everything, I personally would have preferred that there had been a sale above one pound, between one pound, 1 pound, with 2 pounds and so on, to then put that money where I thought appropriate or where I can see opportunities now. That didn't happen, there's no need to cry, no need to worry, we have to move on. And I also tell you that at 072, 075, 077 I think it's very cheap, given the current market. If you're going to check, which I didn't bring because I discussed this in detail at the club, but if you're going to check, for example, the oil that was sold in April, at the price it was sold, brought in almost 60 million dollars and it's one of the four that are done every year. Well, it has almost 60 million dollars in revenue and this company is trading at over one hundred million.
So, with that, I think you get an idea of how potentially undervalued this company is, okay? So, that's my opinion. It would have been better if it had been sold, but it has n't been sold. We move forward. At 070 and something I think it's very cheap. OK? Okay, let's look at the questions, shall we?
Juanma tells us, "Good afternoon. I'm just popping in to say hello.
Antonio Carrasco, good afternoon. Here's my like. Well, we really appreciate those of you who are leaving likes. I don't see any questions about Afentra here yet. If you have any questions, please post them. Now I'm going to move on to the Caspi section, but if there are any questions about Afentra when I finish the Caspi section, I'll answer them, okay? Also, some people think Afentra is overvalued or that they do n't understand its strategy, and so on.
Mane was also talking about potential future acquisitions. He gave me some pretty relevant information about that, although I'm not sharing it here; I only shared it with the club, but it's really quite interesting. And now, as I said, let's move on to the Caspi section, okay? Okay, let's go. With Caspi. Caspi presented its Q1 results. Well, and these were the first results. In fact, this slide isn't a coincidence."
Look, they list the Kazakhstan portion and the Turkish portion. Why?
Because, as you know, Caspi bought Hepsi, Gepsi Burada, and, uh, that's the Turkish part. It's like the Turkish Amazon, because there isn't just one, there are several competitors.
Okay? So, what's the point? Gepsi is publicly traded and continues to be. And in fact, in the video I made with José for the Caspi club, we analyzed Gepsi's results separately because it's publicly traded, and we used the presentation and analyzed that, and then we analyzed Caspi's results separately. The problem with Caspi is that now CASPI is Caspi Group, not just the Kazakhstan portion. So they've combined all the results, and both Kazakhstan and Turkey are listed together. Personally, I preferred it the way it was before, but oh well, it is what it is, and it's a bit like what happened with Afrentra—we can't cry about it, we have to move on. Okay?
So, these are the numbers for the CASPI portion. The revenue has grown by 31%, and listen, this is important, this is Kazakhstan plus Turkey all together, okay? So, revenue in the second quarter of 2026 was $2.3 billion. You see here it's growing at 31%, which is quite strong growth. Adjusted earnings are $768 million, growing at 9%.
The dividend is important.
I'll come back to that now. And this is partly due to the different business models, the different businesses they have. The marketplace is growing at 19%, the e-commerce segment at 41%, which has been very strong. TPV, which is total payments value, is at 14%, very strong, and TFV Total Financing Value, which is the loans they provide, has remained more or less constant. Okay? So, the dividend is $850 million. People will ask, is that a lot or is it... A little? Because, well, the Tengue cazajo is one thing, but we buy this stock in dollars in the United States.
Okay? So, how much is this? Well, I'll put it here for you. 850 Tengue cazajo is 1.83.
Don't forget that the dividend here is paid quarterly. So, if we multiply this by four, it gives us, well, let's say about $7.20 approximately. The stock is at around 80, so the dividend is, let's say, 8% right now, which is a pretty significant dividend. And notice, the payout ratio is 64%, which is quite high, but it's by no means eating up all the company's profit. 64%, and we have that 8% dividend. So, for those dividend investors watching, I'll leave it at that: it's a pretty significant number, okay?
And here we see the consolidated numbers for the whole section. As I was saying, revenue is growing at 31%, Bidda's adjusted growth rate is growing at 9%, and SNC remains flat.
Why is this? It's because they're making a lot of investments in Turkey. They're growing their revenue in Turkey, but by, in a way, putting money into it. And not just into marketing, but also logistics and other areas, and above all, getting the entire internal structure of the company working, or rather, making it work like the Kazakhstan operation. So, they're also investing quite a lot of money in that. Okay?
Regarding e-commerce, here you can see the tech rate rising from 14.9 to 15.8.
This is obviously good news for us in e-commerce. Notice that the gross merchant value is up 41%, the number of purchases reaching 73.4 million. Kazakhstan, I repeat, and Turkey, both countries, but 73.4 million is obviously a very significant number, growing at 43%. And Something I find very interesting here is that right now it's literally 50% Kazakhstan, 50% Turkey. My forecast—we're talking about the number of purchases, because in terms of making money, the Kazakhstan side is obviously much bigger— but in terms of the number of purchases we see here, my forecast is that the Turkish side will obviously start to become larger than the Kazakh side. Okay?
I think this is a very relevant point, and I wanted to bring it up today.
José and I talked about it in quite a bit of detail in the club video, but of course, the advertising side—why do I think it's so relevant?
For two reasons. The first is that it's growing at an incredible rate, it's growing at 73%. But above all, as you can imagine, the money the company receives from advertising is practically income, but the costs are so low that practically everything you receive, a huge percentage, is profit for the company.
So, of course, it's more in our interest for this type of business to grow compared to others that might be much more profitable. More capital-intensive, okay?
So this is growing at a crazy rate of 73%, and it's kind of like, quote-unquote, free money for the company. So this is very good news right now.
Then there's the marketplace part. Uh, good news here in the sense that the take rate is up from 11.1% to 12.1%.
We're getting 100 basis points there.
The GMV is up 19%. Revenue is up a ton, 49%, and the Adjusted Bid, what I told you about Turkey, because here we have both countries together, is up 12%. But well, in general, the marketplace is actually performing quite well.
Okay?
The payments part, this payments part is, uh, fundamentally, only in Kazakhstan because this isn't developed in Turkey. So, the payments part, as they say here, and they're absolutely right, is very capital-light, and basically, it's something that gives you a lot of returns when investing.
Very little money, that's why we like it.
Okay? So the take rate, here we could say, oh no, this is bad news, it was 109 and now it's 103. But there's a very important point here that Jose brought up 3 months ago when we made a video for the club, and he brought it up again in this video, which is that basically the fundamental part of the payments segment, which is growing and evolving and is going to capture a large part of the market, has a take rate of 0.95%.
So we shouldn't be alarmed that this is going down. Why? Because we know that the floor is 0.95 and this is going to tend towards that point, okay? So, in that sense, we're not that worried, and that's a point that, obviously, you have to read the conference call and you have to know these kinds of things. You have to talk to the Investor Relations Manager, which we've spoken to the one from Caspi about four times. In fact, the last time we spoke was about a month and a half ago; we also made a video for the club to explain this kind of thing. Kind of things. Okay, okay. The fintech part. Here we see the fintech part; I put about six slides, approximately, that I prepared for the club. Here I'm only showing one, just to see where we stand—I don't think I'll bring two. So, the fintech figure you see here is the difference between what we receive for lending, as a percentage—the interest, so to speak—and what we pay, also discounting the inherent risk of the loans we offer. So, a year ago we were at 6%, and we're at the same level. A very interesting point is that the average duration of the loans we grant was 7.9 months, and now it's 9.3. And this, in fact, is explained in a slide we brought to the club, and it's because shorter-term loans are being lent less, while longer-term loans, like car loans, are growing quite a bit.
Okay?
And the savings part, that is, the money we give to clients. So, Of course, here's the most important point. Look, a year ago, the interest rate we were giving to customers in savings accounts was 12.1%, and now it's 14.3%.
We're giving customers 2.2% more, and that's why, even though we're lending more money, we 're not actually earning much more.
So, there's something very relevant for CASPI, unlike other types of banks, and that is that what benefits us is when interest rates in Kazakhstan are lower than when they're higher. When interest rates rise, CASPI loses money, to put it simply. And when interest rates fall, CASPI makes money.
So, right now we're at a point where interest rates are quite high, and that's not working in our favor. There's a silver lining and some good news. And the good news is this: with the whole Iran war, there was a risk of a fairly strong inflationary process that, in countries like Kazakhstan, would cause... Interest rates were expected to rise even further. That hasn't happened, and it doesn't seem likely that interest rates will rise in the short term. So, in that sense, it's quite good news. You also have to remember that Kazakhstan is an oil and natural gas producing country.
So, in that sense, at least the country's internal needs are covered. Okay?
And this is the guidance to wrap things up, which I think is very relevant.
So, this is the guidance they provide. Look at the gross merchant value part, which is expected to grow at 20%. In Q1, they were growing at 19%, so totally on track, as they themselves say. The payments part, which was expected to grow around 15%, is currently at 14%, again, on track. Regarding financing, they expect 5% growth, and we're below that. We're not on track here, but I'll tell you something: remember, I said this at the beginning, we're currently reporting at the group level, which means that Kazakhstan is included with the rest of the group.
Turkey. So, why is this important or relevant to what I'm about to say? Because in the second half of the year, the expectation is that Turkey will start lending money, and of course, that starts from zero in terms of percentage growth. So, I personally believe that this will be easy to achieve once the Turkish side starts lending money throughout the year, okay? And the Adjustment Bidda they projected would be around 5% growth, very low for what CASPI as a company has accustomed us to, and we're starting from 9%, so we're also exceeding this target by a wide margin. Okay?
What's my opinion regarding the current situation of CASPI? Well, I elaborated on this quite a bit in the club video, but some ideas I want to share publicly here are that Turkey continues to be very profitable, and that's basically what allows us to finance everything we want to do in other places, such as Turkey, and it also allows us to pay such a large dividend as the one we're currently paying. Okay? Turkey, Turkey at the level Sequential, that is, quarter by quarter. The truth is, this Q1 quarter they presented wasn't exactly amazing, but I think it was quite good and reasonable. So I see signs of improvement in Turkey; there's a long road ahead. And then the capital allocation the company has done is based on giving a very high dividend, where they're probably trying to reward those shareholders who have been very loyal and have paid the dividend back since they were able to, and it's not a low dividend at all, but rather a very high one. So, in that sense, they've really tried to fulfill their commitments to their shareholders, knowing that for many, the dividend is very, very important. Okay? So that's it for the Caspian part.
If you have any questions, leave them here; otherwise, I'll answer them when we get back. These two companies are featured in two videos we made for the club this week to give you an idea, because you see the content in... Open, but you don't see the club part. Um, in this club this week, just this week I think we've made, if not three, then four videos just for the club. In fact, I've made two: this one about Caspi and the video about Acentra.
Ciprés and José also recorded.
So, there you see some of the things we have for the club. The truth is, it's a brutal level of company follow-up. It involves talking to company management, bringing in new theses, doing follow-up—it's a lot, a lot of content, and the content is incredibly detailed. I've spoken here for 15 or 20 minutes about Acentra, but the video I made for the club is almost an hour long. I've talked for 10 minutes about Caspi, but the video I made with José is also an hour long, so you get an idea of the level of detail.
You can find us at Momentum.dot.financial. Places are open. If you have any questions, [email protected].
And very importantly, the offer we have with Mexen. Okay, those 3 months of free club membership. Basically, if you open an account with Mexen and make a minimum deposit of €2,000, or if you transfer your account from Interactive Brokers to Mexen—which literally takes 3 minutes, okay?—and that account has more than €2,000, you get 3 months of club membership completely free. We handle everything. All you have to do is open the account and send us an email to [email protected]. I've put it below. Just say, "Hey, boss, I want this offer, and my account number is this one, and I'll take care of absolutely everything."
A lot of people are joining, and the best thing about it, and what makes me happiest, is that of all the people joining, they are very happy and have told me so privately about the club's content. So, we must be doing something good. OK?
Perfect. So, that's all for the club's gems. Let's begin. with Nagarro.
Okay, the Nagarro part, uh, it's curious, before starting I'll say why Nagarro is a company that, even though time keeps passing, doesn't leave anyone indifferent, so to speak.
So, there was a bit of controversy within X because obviously I make the announcement, "Hey, this Sunday we're bringing this." And there were like a couple of people who called me names, like, "Wow, why are you bringing Nagarro?" And of course, I say this in case other people with other companies don't like what I bring, etc. So, what is it I'm trying to say here? At Momentum, what we try to do is identify the companies that the community, the people of Spain, follow, and if we can talk about them and have a minimum level of knowledge, we bring them in. That's why we bring Nagarro here, but that's also why we bring in, for example, STS, to name two companies. And I don't carry a grip in my wallet, I don't carry STS in my wallet, but please let people understand, we sometimes make four videos a week, which means going to between 15 and 20 videos a month. We talk to about 20, 30, or even 50 companies in a month. So instead of giving me advice like "don't bring Navarro because I don't like this one" people, how much do they stop to think that we have to talk about many companies every month and many months go by? If you don't like Navarro's program, I completely respect that, just don't watch it. But we shouldn't go around criticizing others when I bring, I was going to say dozens, but it's hundreds of hours of free content because this is free for everyone. So, I'm not forcing anyone to be here, okay? But if you think Nagarro shouldn't be brought in and company X should be, then start a YouTube channel and bring it in and it'll be great. And if you create good content and it resonates with me, I will support you and your channel. Okay? I'm simply saying this as a reflection because it's very easy to say from the outside, "Oh, I don't like this.
Oh, you're bringing Nagarro, I don't know what." In fact, in the same week I was accused of being a Nagarro fan, saying I bring Nagarro up to support him, but I've received private messages on the Nagarro Discord saying that I was a Nagarro hater, that I just wanted him to go down. I mean, I've received private messages like this, "Captain, you only say bad things about Nagarro, you're only interested in him going down, you don't look at the good things." So, let's all stay calm, those on one side and those on the other, okay?
And here he tells us, Chiver Arrachaldón, we send you our regards. I like that you're live, that you're not just there on Thursdays, so really, thank you for being there. You must not like football because you're only logging on now, when I've noticed a drop in viewership due to the football situation at 7, but you're still here, I appreciate it. And he says, "Well, but whatever you do in this life, someone's going to criticize, they bark, Sancho, then we ride on." Well, it's a reality. The thing is, my problem sometimes is that I try to reason with people, and maybe I'm just too naive because I try to speak politely and reason with them politely, but I do n't understand the offense of me bringing "I'm on Sunday" when I also bring Caspi, when I bring Fentra, when last week I brought Clair, when next week I don't know what, when we've talked about Baidu, when we've talked about Baba, when we've talked about Tesla, about Microsoft—these are just companies we 've talked about in the last 20 days, okay? So, I don't know, I don't know the level of offense. Perhaps I say this as a reflection, and I always say it for people; maybe they have the problem more than I do. OK.
But come on, let's get on with Nagarro. Like, the good manas asks us to. Disruption.
Disruption is giving Nagarro a like.
There you have it, okay?
So, starting with the basics before we get into the numbers, I found this very interesting; they put it in the presentation for the first quarter of 2026, and it's kind of like, "These are all our partners." So, sure, we see very relevant companies, we see Amazon Web Services, we see Microsoft, Oracle, OpenAI, SAP, Databs, Google Cloud, all this is great, but of course, in the end, this doesn't tell me much, I mean, it's good, but it doesn't tell me much in the sense that obviously you do the implementation of many of these people's things. It's not that they're obviously thrilled to work with you, because what they want is for this to reach as many companies as possible. So, but I'm not in hater mode either, I mean, it's okay, but it's not like, I mean, what do I mean by this? It's not that Amazon Web Services has a €3 billion contract with a firm grip, if you know what I mean. They simply work and a lot of work gets done with them. Perfect. Well, I found this part very interesting because they put it quite early in the presentation they released, which was also very short, and they said it focused on this part of corporate governance and said, "Hey, we're improving corporate governance."
As? We have a new auditor, which is true. Okay, they have a Big F.
There was a lot of noise with that bearish report, that whole part was pretty ridiculous, honestly, like, oh, they have an auditor who isn't that important, blah, blah. But they did what they had to do. Let's just put a Big F and that's it. That's it, check, check. It's perfect. Then the enhance reporting and disclosures.
Internal profitability controls, of course, we did n't get to see these, but oh well.
Okay, they've made the board bigger and included more people. That's good news. Set buybacks and dividends while tempering leverage. Well, PowerPoint can handle anything because if there's one thing they haven't done well, it's location capital, and if there's one thing they haven't done well lately, it's being Bibbacks. Disaster, dividends are too high. In my opinion, it's not good. Being BBAX, I think we all share mistakes. I think dividends are just my opinion, given that there are other things that aren't done well, but hey, they present it as something good, they throw it out there and if it sticks, it sticks.
Sustainability improvements, irrelevant.
Conclusion of internal investigation. It is true that they did conduct that internal company investigation to see if there was anything unusual. It was obviously done by an external company. Well done, it came out, everything was clean. In that sense there is no risk, well done by the company. And Improve Risk Management and Internal Controls and new CFO. Okay, this news is from April 16, 2026, that is, about a month ago, Nagarro hires Pratec and Garwal as finance, uh sorry, as chief financial officer. In other words, we've had a new CFO for a month now, and here's some information about where this CFO comes from, okay? At that time, it was a necessity for the company.
The company had grown a lot in terms of revenue and there were certain roles, including the CFO, the Chief Financial Officer, that perhaps had not become professionalized enough.
OK? And here, if they did it, it took them time. I wish they had done it sooner, but they've done it now. So now this guy is on board and we're going to see the decisions he makes as chief financial officer. Also, I'd like to say one thing: in my opinion, it's not a company where the role of Chief Financial Officer is that important. In other words, it's not a company with a very, very relevant financial level. Okay, here it's much more important. In other words, basically what they need is for contracts to come their way, basically. Well, it's not about moving money around, getting financing, issuing convertible notes for I don't know how much, etc., it's not so much about that. But anyway, having said that, we need a professional financial officer, okay? Okay, let's look at the numbers. So, the revenue, look, the revenue is 248 million euros, it grows at 0.5%. It is flat compared to a year ago and grows by 0.9% compared to a year ago when it was 245 million. So this is important. Wow, Nagarro in the 40s, this is a rip-off. They want to steal the company. There are some evil speculators there, I don't know what.
Look, the company isn't growing. And here you see the numbers. It's not growing compared to a year ago, it's not growing compared to a quarter ago. If a company does not grow, the valuation ratios it is given are very low. Too low, they could be less low and so on. Okay, that's a topic for discussion, but you can't pay per 20 for this, but you also can't pay per 15. Perhaps you can't pay per 10, honestly, because the company isn't growing and because it's a sector where the entire sector isn't growing. And Nagarro isn't the only one with these ratios; it's all the companies in the sector.
Because? Because there is a doubt in the market, which I think is a reasonable doubt, that AI is going to disrupt everything these companies do, that AI is going to take business away from them. Well, some say yes and some say no, but growing at 0.5% clearly doesn't help those who say no.
Okay, that's a fact. So, what do I mean by this? Until this company starts growing at 5, 7, 10%, it's not really going to get a rerating, to go much higher. Okay? That's simply the note I want to give and my opinion. By the way, I think we're releasing a video on Tuesday; it's 30 minutes long on the fast site, which you know is where we release theses on a single company quickly, quickly by the momentum standard. We have done it or we are going to do it in Nagarro. Okay, then on Tuesday we'll tell you what it is and how cheap or expensive it is in terms of its value. You'll have that video on Tuesday. Okay, so, continuing from here, revenue is flat. One good thing I like is that it has a very high level of cost discipline. Note that costs are even lower than in the same quarter a year ago. Okay, then the costs go down. I like that, and that's why we achieved a gross profit that is a little higher than a year ago.
We only grew in revenue by 0.5, but gross profit grew by 2.4. It is true that compared to the previous quarter it is slightly lower, but well, in the end what we can see is a generally flat revenue, a generally flat gross profit. And if we look at the Justice portion of Biddda, it has decreased by 6.5% compared to the previous quarter and increased by 3.3% compared to a year ago.
So, in general, these are numbers that are quite flat and quite constant. In terms of margins, as you can see here, the gross margin is at 31%, which is slightly improved compared to a year ago. Okay?
Good. Okay, let's continue. Here you can see it in graphs.
Revenue, boom, gross profit, adjusta.
All three are practically flat.
Of course, doing a ray rating like that is practically impossible. That's just how it is.
One thing I really like about Nagarro is that they don't cheat at all with Adjustit Ebidda. Did you know that companies often report EBITDA and Adjustment EBITDA, and many use Adjustment EBITDA to remove things that are actually relevant from EBITDA, but they claim they are not relevant? So basically, Bidda's Adjustic is a way of presenting nicer numbers compared to what I would call the real numbers. The good thing about Nagarrock, which I like a lot, is that they don't cheat at all with Bidda's Adjustic. Think about it, the Justice Ebidda is usually higher than the Ebidda, that's why an Adjustit Ebidda is used to make the numbers look better. But Nagarro, you won't see this in many companies; the Ebidda Adjusti is lower than the Evidda. In other words, in these quarters, such as this first quarter of 2026, it would have been better for them to present the EBITDA, which was 38.8 million compared to the Justice EBITDA which was 31.2. But in that sense, one thing I like is that they are not pirates at all.
No pirates in the sense of two quarters ago the Adjustic Evita is better, we present the Adjusted. Now the Evita is better than the Adjustic Evita, we present the Evita. They are not like that.
In that sense, they are quite consistent and always present the same thing. So in that sense, I take my hat off to the company and the truth is that they are quite fair in the way they report. And by this he means that in the future, whatever they put in place as Justice of Bidda can be taken as a good operational measure. Okay?
I really like this information because they provide a lot of information about the company's income.
Let's go first to this one here, and that is in which geographies, in which countries, in which areas they earn money. So, look, the main area is North America, which is primarily the United States, also Canada, but primarily the United States. Then it has a very large part which is, uh, Central Europe, which is the countries you associate with Central Europe, but the bulk of it is Germany. To think that the company is in Germany and has a lot of dealings with all the German multinationals, especially all the automotive multinationals, etc. We'll look at it later, okay? So, that's here. The rest of Europe, which is where, for example, Spain would be, and the rest of the world, which is 24%, okay? Then by customers, look, the top five, Nagarro's main customers represent 16% of revenue and the next top five, that is, from 6 to 10, represents 9% of revenue. So, putting both things together, we have that 25% of the revenue comes from their first 10 customers. There's a lot of concentration; they 're really reasonable numbers.
So, in that sense there is no problem. And that's quite reasonable. OK?
Among the various industries, the main one, look here, is cars, okay? Cars and cars, a lot of Germany, which, as I say, works a lot with companies there. Then, Financial Services and insurance companies, 14%, the retail sector, 13%, and so on. Those are their main businesses. And here to add to that, I really like this information they give, which I find very, very interesting, which is, uh, they give us two things, they tell us in what currencies they receive the money, it's this one here, the first one.
And in what currencies do they spend their money?
So, what currencies do they use for income? In other words, what currencies do customers pay in? Well, look, 94.6 million euros in euros. All of this is in euros, okay? The equivalent.
So, the next currency, dollars, 87.2. Sure, if you go here it makes sense because if you take this 29, add the Rest of Europe, it's 41%, which is the European part, so to speak, and the North American part is 35%. So, with this, what do I mean? The European part, although not all of it is in euros, but the vast majority is in euros, is a higher percentage of revenues than North America. So it makes sense that it's more than eh US dollars.
Then there's the Indian rupee, 21.1 million 21.9 million, excuse me, euros. And I find these very, very interesting. The AED, for those who don't know, is the dirham of the United Arab Emirates, and the SAR is the Saudi royal. So, this is a way of saying clients from the United Arab Emirates 9.5 million euros, clients from Saudi Arabia 6.6 million euros. Why am I focusing on this? Am I focusing on the 9.5 million and the 6.6 million?
No, because compared to 248 it's somewhat irrelevant. I'm focusing because I want to show you the changes. Look, a year ago the United Arab Emirates portion was 9,000,000 and it has risen to 9.5. Okay, I'll raise it by 5%, rounding up. The UAE share was 5.1 million and rises to 6.6 million. Here we are talking about a fairly large percentage, around 25-30%. So, what was already happening in the first quarter of 2026? The war in Iran.
Who was affected by the war in Iran? To Saudi Arabia? To the United Arab Emirates?
Why do I think this is relevant? Because I've already seen several companies rig things and say, "No, the numbers aren't so good because of the war, blah, blah."
Well, the war started at the end of February, in Q1 it lasted all of March, but even if there's a bomb on March 1st, it does n't usually reach companies instantly. So, for me, the companies that started talking about the war in Q1 have affected us; most of them, not all, but 90% are just making excuses. And here's proof that a company like Nagarro in Q1, when there was already a war, those two countries actually spent more money.
Okay, so this means that, well, Capi, you 're not paying attention to the war. I don't think it will really affect Q2, but I think in Q1 it was just an excuse. My opinion. Okay, let's continue. There have been some very large variations between industries. I also really like this because they give detailed numbers for each of the different areas where the business is conducted. You have the data from the first quarter of 2026 compared to the first quarter of the previous year or the last quarter of 2025, and we see how they change. So, what is it about these numbers that strikes me? I am struck by the fact that the management consulting and business information segment is very strong, growing by 8.9% compared to the previous quarter and by 20.2% compared to a year ago.
Very good. Then Financial Services and Insurance grew very strongly. Here's where I have a doubt: look, it grows more or less overall by 12% compared to the previous quarter, and 12% compared to a year ago. My question here is whether they are taking over part of Naba's business. We know that Nva is a company that is in an extremely weak state. These competing companies are not stupid and they know it.
So, I don't know to what extent not only have I grabbed, but other competitors have gone to the City, to all those clients, to bid, perhaps being a little more aggressive in price, to take contracts away from the current big players. Okay, that's just my theory based on seeing those numbers and nothing more. But on the downside, look, there's a massive drop in this part called horizontal tech. It is down 20% compared to the previous quarter and 34% compared to a year ago. So, I personally didn't know what horizontal tech meant, I had no idea, but that's what AI is for. Okay?
So I asked the AI and the AI told us this. Characteristics of the companies involved here include digital infrastructure, cloud computing providers, data centers, networks, and connectivity.
General-purpose software platforms such as ERP, CRM, collaboration tools, document management or cybersecurity, basic technological services such as IT consulting, systems integrations, outsourcing of technological processes or productivity and development tools such as office switches, low code development platforms, no code or universal APIs.
examples Microsoft, Amazon W services, Google Cloud, Workspace, SAP, Sales Force. So it's curious because if you notice, I started today's presentation talking precisely about those companies, about how they highlighted those partnerships, but here you see the numbers, the things related to those partnerships, it's actually the business that's declining the most right now.
So, it's an issue that needs to be monitored, and we'll see if it goes away. We also have the advantage here, things as they are, that it would be much more worrying if the automotive or financial services sectors declined because they represent much larger assets.
This one, within its limitations, is by no means one of the biggest. So, if one has to fall at rates of 20-30%, obviously the small ones are better than the big ones. Okay?
Okay, let's get to the balance. But first, I'm going to see if there are any questions or if anyone wants to comment.
Okay, Antonio Carrasco tells us, "The bad thing about Nagarro is that what it gains in AI contracts it loses in the traditional services sector." I think it's a little too early to say. Well, we need more quarters, maybe even a couple of years to really see if that 's the case or not. Okay, Benceno, I'm sending you a hug, whether you're in Pucela or León, both are good places. He tells us, "Good afternoon (belated), a like is required." And Antonio Carrasco also tells us, "Nagarro promised an 18% margin by 2026 in 2023, and we're currently at 14.5-15% guidance. With that, you lose credibility," Antonio says.
I agree, but I don't agree. I mean, the problem, as I always say, is giving guidance beyond a year.
In general, in practically any company, in any sector, it seems almost impossible to me because companies sometimes don't even know where they'll be in three months, literally, and they tell you, "Well, yes, it's May 2026, but in 2029, I don't know what." You have no idea. I mean, the spreadsheet is fine, but you have no idea. That's why when companies come out with, "No, this is my plan to 2030," well, I value that at zero. I don't even count it, I mean, I don't look at it.
I say, "Okay, let's see how you are in a quarter, and I can..." Look at a year, because it's not like I'm looking at it quarter by quarter. I am aware that there are companies where, for example, you make a very large investment at a certain time. They might lower your margins in the next few quarters to make something positive and so on, but when they do the typical thing of saying "not in 2030 the margin is going to be I do n't know what". Well, that's your idea, but it may or may not be. So, of course, Nagarro's problem when he promised until 2023 is that we were at a different point in the business than we are now, and even they couldn't have known that we would be here today. So, I do n't think it's a lack of credibility on the part of management. I think it's more than just them taking a three-pointer, but they all take them. Okay, he tells us here, "Long live freedom, Carallo." I understand he's Galician, so we send a hug to Galicia. Uh, but it did grow in Constant Currency, did n't it? Yes, it is true that in constant currency it grew somewhat more because the euro exchange rate, which is what they report in relation to other currencies, has gone against them. But well, I haven't made too much of it, like, wow, it's flat, I don't know what, or if next quarter, because the currency is in their favor and they're growing by 4% in revenue, I'm not saying this is amazing.
In other words, they clearly don't grow. That is, as Antonio Carrasco says here, yes, about 6%. That's practically growing at the same rate as inflation.
What do I mean by this? To get out of the current numbers, the current price levels, you need to grow by 10, 15%. That's the reality. It was thought that the demand was there, but the demand is not. It was thought that there was no cyclicality, but there is cyclicality. So, until a clear way out is truly seen. And that's not going to be just Navarre, that's going to be the entire sector. We have to look at that in Globan, we have to look at EPAN, we have to look at Accenture, even perhaps in the company itself, despite it being the worst in the sector and so on. Until that happens, it's very difficult for us to move forward. Okay, I'll go back to the balance section. Here you can see it, both the assets and the liabilities. So, putting it in more detail here, let's start with current assets.
Current assets are primarily cash equivalents, 112 million. And then we have the trade receivables part. Notice that this is what they have to pay us and it grows from 198,000.
So this basically gives us a clue that the cash flow, the working capital part, is going to work against us. Look here, in theory, with just this we would have those 11 m000ones more or less, which goes against it. Okay, we'll see it later in the cashfow, where I'll explain it in detail. Then if we look at non- current assets, you'll see that the bulk of non-current assets, of course, includes right of use assets, which is all the rentals, the offices where they are located, and so on, but this isn't as relevant because it's quite constant and always there. And that's the part about goodwill and intangibles. Goodwill, obviously, is all that money derived from acquisitions. Notice that it goes from 206 to 209,000, probably due to some of the acquisitions made in Q1 and the intangibles that remain constant at 44,000. So, of the 746 million assets we have here, it should be noted that 250 million, rounding up to a third, are intangible assets.
Okay, just something to keep in mind.
Okay? If we go to the liabilities side, in the liabilities section, look, we also had to pay 19,000 at the end of year 9, sorry, 2025 and now we have to pay 16,000. In other words, we have reduced the debt we have to pay by 3 million, which again is 3 million more that we have paid, in quotes. Let's see if it shows up in the cash flow, in this case negatively in the working capital part, okay? And here is the most relevant part of the entire liabilities section, look, 571 million,000000 is this here, which are the loans.
Loans that remain consistently at 300 million, above 300 million. At the end of 2025 there were 307 million and now there are a high 306 million.
In short, 3 months have passed and we have the same level of debt as we had the previous 3 months. Okay?
So, an important part here is how much debt it has on hand and how leveraged the company is. So, one of the ways to look at it, or the more traditional way in general for most companies to look at their leverage, is to look at how much net debt they have relative to their EVICTA.
OK? So, here are the numbers. They give you this themselves.
What is the company's net debt?
Well, the company's net debt includes all that debt I mentioned about 310,000, plus the part that has to be paid in the next 12 months. They add the list liabilities, which I personally would n't add. In other words, if I did the calculations properly, I would remove this line. They add it up, which gives them worse numbers and therefore they are more conservative. That seems perfect to me. Good.
And then, obviously, they subtract the cash and cash equivalents that the company has. Then it gives you these debt levels. 3 months ago, at the end of 2025, it was 257 million, and now it's 10 million more. And they compare that with the adjusted Ebidda, which, look, we saw again that the Ebidda was greater than the adjusted Ebidda.
In other words, if they calculated net EBITDA debt here instead of adjusted net EBITDA debt, the numbers would look better for them, and yet they don't. This is very good. In other words, I can say many things I don't like about Nagarro. The whole part, sometimes the entire part of investor relations, was the capital location part, which has always seemed very bad to me, but in terms of reporting, being loyal, being objective, and not doing shady deals, they are very good, things as they are. Okay?
So we have this debt, we have that adjusted debt and it gives us the net debt ratio, uh adjusted debt, in this case 1.9 times.
So what does this mean? Well, the company is not dangerously indebted. In other words, the risk of the company going bankrupt, having too much debt, having to raise capital, blah blah blah, is not there. It's at reasonable ratios, but it has debt. For example, to compare with EPAM, okay?, from the sector, EPAM has a cash register.
So, that's noticeable too. If you want to buy shares now, you're at a very low level and you want to start buying like crazy, obviously EPAM has more capacity than Nagarro, okay? Hey, but Nagarro doesn't have a debt problem, I want to emphasize that.
Then there's this, which I think attracted a lot of attention, which is the cash flow part, because look, we have the first 3 months of 2026 here and those of last year. So, last year there was an operating cash flow of 37.5 million and it is true that a lot of money was then spent here, much more money, so to speak, especially in the financial part.
But of course, operating cash flow is 37 million y5 and we arrive at this first quarter of 2026 and the operating cash flow is negative zero. So, what exactly happened? The company no longer generates money, the company is bankrupt, we're in a terrible state, blah, blah, blah. Okay, I'll bring it to you and we'll see it. Okay, there we see it. So this is just the operational part. We start with an EBIT of 30,000,000, we add the depreciation part which is quite relevant, it 's almost 9,000,000 and the problem is that we get here you have some other non- casting and expenses that we see here which in this case is quite relevant 6.5 million that go against us. We'll have to see now, I'll read it to you, why this is happening. You pay 5.5 million in taxes, but above all, you pay working capital. I told you in the balance sheet, I told you here, I'm going to go back, I told you to watch out here with this part of the receivables trade, that the working capital will probably go negative because of the receivables trade part. And I told you here in the trade payables section, be careful, that it will probably go negative here too.
So we're back here, we come here and you see it, the working capital, which a year ago was positive at 10 million, that is, the changes in working capital, eh, regarding the money we have to pay, the money that clients pay us and so on, was plus 10,000 a year ago and now it is -22.
Okay, so it's a quarter where working capital has worked against us a lot. What could be the reason for this? Well, you already saw part of it. It is possible that some customer payments are delayed until the following quarter. It doesn't have to be anything to worry about, so to speak, but perhaps it could be that Nagarro is making additional expenses by getting involved in new projects and so on. We'll see that in the coming quarters. So, of course, when you subtract no less than 22,000 here, you arrive at a virtually flat operating activities where 282,000 euros are lost. Okay, and I'm going to read a little bit of this. This is translated into Spanish but taken from the company's results, okay? It says, " Operating cash flows decreased by €38 million, resulting in a loss of €300,000. This decrease was primarily due to an increase in working capital of €32.4 million. In Q1 2025, operating cash flows benefited from higher receipts of US Public Sector Receivables. Furthermore, operating cash flows were negatively impacted by higher bonus payments, including retention bonuses, as well as an increase in status dues payments in India compared to Q1 2025. Additionally, operating cash flows decreased by €12 million due to lower non-cash income and expenses compared to Q1 2025. This was primarily due to a €10 million increase in unrealized foreign exchange gains on intragroup loans within the Navarro Group versus unrealized foreign exchange losses in Q1 2025. So, that pretty much explains why we 're in this situation." That's it, but the reality is that the operating cash flow we have in this first quarter of 2026 is zero. Okay?
If we continue down the investing activities section, we see it here.
So, payments for property, plant, and equipment are down, only 1.3 million. Very good. And the rest is practically zero.
Look, acquisition of subsidiaries: zero. Nothing has been paid this quarter, okay? And to finish the financing activities section, look, we'll see it later. Repurchases a year ago— we'll see it in detail later— a year ago repurchases were 21 million, and now they're barely 2 million. And if we go down further, the part about paying the constant liabilities—everything you have to pay, rents and such—is about 5 million, and the interest we pay on that 300 million of debt we have is 4.5 million.
Okay? And here I'll show you the repurchases section. In fact, I'm going to I'm not going to take this out later. Okay, so they give this in detail. I like it a lot too. It's a very good level of information they provide. And look, of all this, everything is fine, but what are we interested in? Not so much the ones they withdrew, the ones that I don't know what, how many have treasury stock, what we're interested in is how much you repurchased in Q1 2026. Well, here it is. Total Treasury SARS acquired during the period. This is what they repurchased in the first quarter of 2026. 30,195 shares that cost them €2,271,000. So I'm asking someone with a calculator handy if they can do the division of one thing by the other to find out the average price at which they bought the shares. If you could give me this average price, please, for 2026 and also for 2025.
If someone could put it in the comments in a minute, I'd appreciate it. I really appreciate it, okay?
Because I think it's a topic that could be very relevant. So, uh, continuing with this, look, a year ago, in the first quarter of 2025, they bought back almost 1 million shares, 919,421 shares. Now they've bought back 30,000 shares, which for the size of the company is practically no buybacks, okay? So, a year ago we were really going all out buying shares here, and in this quarter we've practically done no buybacks at all. So, I'm especially interested if someone is doing the calculations for me and could post the 2025 figures in the comments because I'd be interested in that average price for the first quarter of 2025. I mentioned it here when we were talking about capital allocation as a critique; look, I used March 3rd of last year to give you an idea of the levels the stock was at. It was at 85, 80, 87, 82, okay? At those levels. So, here at 80-something, they went on a historic buying spree. Okay, they spent 67 million euros in that quarter buying back at these levels you see here. And now we're... well, it's true that it's from 2026, it's the first quarter, it's from here downwards to be fair, but of course, let's see what happens in Q2 because now we're at 40-something, okay? And the problem is that a new buyback program hasn't been launched either, with an emphasis on the COL, where the strongest buybacks are, right? So we have to keep that in mind.
Look, they're telling us here—uh, I want to thank José Luis Albert first, thank you very much—that it's 75 in 2026 and uh, 73.8 in 2025, and Antonio Carrasco confirms the 2026 figure and the 73.8 in 2025. Well, thanks to both of you because this information is really helpful for those of us here watching the live stream.
So, my question is, 73.8 in 2025 and you've spent 67 million euros, which is a huge amount. Look at this company's cash flow. Okay, 67 million is considerably more than the company's normalized quarterly cash flow, however you want to normalize it. Even if you normalize it slightly upwards, they spend 67 million at €74 per share, which is currently at €40, having reached €39.5 on Friday.
Let's see if they buy back shares, because the reality is that if they don't buy back now, but they spent that much at €74 a year ago, the capital allocation is very poor. Okay, so I'll leave it at that.
And they include this in their own presentation. It says, "Nagarro has repurchased 30,195 shares for 2.3 million "of euros." Clearly, it hasn't been a quarter of share buybacks, which makes sense if you think about it. Why?
Because, of course, it's been a quarter where, for one reason or another, due to working capital, blah blah blah, no operating cash flow has been generated. So, of course, if you start from zero operating cash flow and you add 30-40 million to share buybacks, plus another 30-40 million in debt, which they may have also considered, and perhaps they won't repurchase shares or perceive that the Q2 operating cash flow won't be as strong. It's a possibility. I'm speculating here.
Okay, regarding the Outlook. The Outlook.
They said in the Q1 presentation, "We maintain the expectations we stated in the 2025 annual report."
So, I went to the 2025 annual report, and this is the guidance they gave for 2026, which is between 1 billion and 1060 million in revenue. Keep in mind, they have to increase a bit because We started from 240- something, if I remember correctly. Sure, 1000 / 4 is 250,000,000 per quarter, so we should see a somewhat sequential improvement in the coming quarters, right? But between 1,000 and 1,060 million euros in revenue, and it says that at the midpoint, 1,030,000, corresponds to a 5% increase compared to 2025. I repeat, that's keeping up with inflation, that's flat, okay? It's not growth, or a recovery, or a demonstration of a return in demand. When they're already giving you this guidance and maintaining it in May, when practically 5 out of 12 months have passed, the message is that demand clearly hasn't returned. Okay, there's always that clingy message that demand will return, demand has to come back, the famous dam, blah, blah.
Demand isn't there at the moment, because otherwise you wouldn't have guidance for everything.
2026, with a rise of barely 5%, which is essentially 3% inflation, so it's just a rise of little more than inflation, okay? And it says gross margins around 32%. If I remember correctly, we were at those levels in Q1, and adjusted profit margin between 14.5% and 15.5%.
So, in fact, I'm going to go back and look at them, okay?
Here we go. Look, they were giving a gross profit of 32%, we're at 31.2%, we're close. It's quite feasible that this will happen. And here's what I think is more difficult to achieve. Look, adjusted profit margin, I think they said 14.5%, 15.5%.
Let's say 15%. We're coming from 12.6%, a quarter of the year has already passed, and we have 12.6% to reach 15% for the whole year. You already have to start by getting back up from 12.6%. From Q1. So, uh, I think this is unlikely to happen today. They would have to recover starting in Q2 and have very strong margins in Q3 and Q4 for that to happen. Okay, I personally think it's unlikely to happen, we'll see. Okay, so look, 32%, as we were saying, I think the gross margin can be achieved, but the 14.5 to 15.5% margin for Atasitebidda seems more difficult to achieve. Okay, ticker moment, I'm bringing a couple of valuations, no more. Why?
Because, as I said, on Tuesday we're releasing a video where Cipres and I, Nagarro, explain in half an hour and we bring many valuations. So I'm only bringing two.
How expensive or cheap is this? I'm bringing the P/E ratio and the EV Bidda. So the P/E ratio, which for me isn't the best way to measure this company or this sector, and EV Vida is better, but I'm bringing you both. Current P/E ratio, here it is You see, 8.25 times. The lowest it's been is seven times, its average is 25. Sure, but an average of 25, this has been trading at this level since December 2020. All these levels, for me, represent absolute overheating. Where could the average be?
Well, the average might be around 15 times, let's say. So, at 15 times, we're at eight. It's doubling to get to what seems to me a reasonable average for the sector. Wow, we have a bagger here. Yes, wait, but we have a bagger, okay? I repeat, until we have growth of close to 10%, and 10% or higher, it's very unlikely there will be a rerating here. Then, when that happens, this could very well go to an average of 15 times P/E, which could mean making a bagger just with the rating part, plus whatever the numbers improve. Okay, but that's not there, and there's no indication that it's there. Okay, just to make it clear. Then I much prefer EVBDA. Why? Because with EVBDA, to begin with, you eliminate all the depreciation, which is very relevant in companies that make many acquisitions and have a lot of depreciation, but it's not a cash outflow. But above all, because obviously, enterprise value takes into account debt, or if there's cash, net cash, because it lowers the enterprise value.
So for this sector, VBITA is much better than P/E. Okay, what's the average?
Look at the difference, by the way, I'm going back, we're at eight times P/E when the average is 25. It's like we're way off; we have to multiply by I don't know how many times. If you look at it by EVIDA, we're at five times and the average is 12.
There you're not so far off. Okay, so again, what could the average be for this sector? Well, I'd say that maybe 10 times VBITA could be reasonable, which again is doubling just to do the rerating. I already said when this was going to happen. Okay, and by the way, I'm thinking of making a specific video comparing companies in the sector. I want to compare Nagarro, Globan, and Epan, at least those three. I don't know if I should include something like Acenturo, even though it does other things and is bigger, etc. I don't want to include Dava because it's one of the worst in the sector, and I'm a bit lazy about including it, but at least I want to compare those three, and above all, I want to compare which one is cheaper, let's say, with respect to all these kinds of ratios and the growth levels they've shown in recent quarters. I think that video could be very interesting because, for example, one thing we talk about a lot in the Momentum Discord server—which, by the way, you can find a completely free link to in the video description, and it's active in Momentum all the time—there's a specific thread for Nagarro and the Haitian sector, and there's a thread for CASPI and a thread for Acentra, by the way.
Each of the companies I've mentioned today has its own specific thread. So, a very interesting debate there is that EPAN is practically reaching certain ratios... In terms of valuation, like Nagarro, or even cheaper, the difference is that EPAM has net cash, while Nagarro has the debt we saw, and EPAM is buying back very, very heavily. So I think that video could be very interesting.
Okay, regarding ticker, for those who use it.
We use ticker all the time right now because you have absolutely all the information on the companies, and it's super easy to create charts and keep track of everything. So, anyone who wants to open a ticker account should know that in the codes section, by entering momentum15, you get a 15% discount on the price it gives you. And there's a special 25% discount for club members.
So, club members or people who follow us closely, send me a message to [email protected] if you want that 25% discount on your ticket. Okay? And to wrap up this part, now for questions. By the way, if you have any questions, write them down now, otherwise I'll read them all and we'll be out of here, okay? So that's it The time for you to start writing them down.
Nagarro's financial calendar. Look, we've already published the results for the whole year, March 24th, very close to the results section, and the consolidated, reported, and audited 2025 report. We 've already reported the first quarter here, May 15th. And the next thing is the annual shareholders' meeting, June 29th, and the half-year results, August 14th.
Third-quarter results, November 13th.
So we're left with those numbers: June 29th, August 14th, November 13th. Okay? So, now let's see the comments we have here and you can tell me what you think. Let's see, from Dominguero Mood: Hi, Capi.
Why doesn't Constellation Software operate the same way as these other software companies? Is it because of the intrinsic business relationships with whom they work? Well, I'm sorry to disappoint you, Dominguero Mood, but Constellation Software isn't a company that I don't follow you very often, so I can't answer you. Unfortunately, those of us who go on shows about finance don't know all the companies, or maybe I'm the only one who doesn't know them and other people do, okay? But I can't answer you because it's not a company I know. What I can tell you is that in one of the Discord threads this week, I read that Constellation's results this week were spectacular. I only glanced at them; I mean, I'm not qualified to tell you much about the company, but I did look at the numbers, and the numbers they presented in Q1 are very good, but that's all I can say.
José Luis Alber tells us, " DSOs increased in 4 days, and that ate up the free flow." Do you see it as serious enough to keep an eye on, captain? Well, the truth is that having a zero operating cash flow in the quarter is serious because in the end everything you want to finance, whether it's dividends, buybacks, acquisitions, etc., has to start from the operating cash flow and then you'll take on more debt and less. But of course, if you start from scratch with Unic Operador, you have very little ability to do anything. So, it could be a quarter because the whole working capital part coincides with everything going against you, so to speak. That's a possibility, but I think it's something we need to keep a very close eye on heading into Q2. I agree with that.
José Luis tells us, "I have a position in Agarro, but with Monday's news, it seems like a better opportunity. EPA is growing faster, they have cash reserves, and their market capitalization is higher. Look, this sector is generally not one I've invested in. I've done a couple of medium-term withdrawals in Agarro when it's dropped significantly, but it was purely trading, meaning I'd exit within a few days, because it's a sector I don't know much about. On the one hand, I don't know much about it, but above all, it's a matter of waiting for real demand to return to a certain level of investment. But having said that, I think right now EPAM is probably a better investment than Nagarro, although I'm not invested in either of them, as I said, but I'm going to try to run that program in the coming weeks and we'll see what numbers come up.
Basically, Josean Sánchez tells us, 'Hello, we send you our regards.'" Rollans, I learn a lot from these live streams. Thanks, Capi." Well, I'm glad you're learning, and that's what we 're here for. And what better place to spend a Sunday than learning about finance, which is useful for life?
Imagine watching the Spanish league, which is so bad, on top of everything else. Okay, so that's it. And Antonio Carrasco tells us, in Dava today, EVID is 3.31.
Yes. Uh, the truth is that in Dava it's very cheap, but it has very low quality.
So it makes sense that it's the one that's also, of course, watch out for SVIDA because SVIDA doesn't include Naba's SBCs, and Dava's SBCs are very large.
So, for companies that, like in Dava, are already generating very little operating cashflow, but have large SBCs, EVDA is a bit complicated, okay? So, that's it.
Uh, further down the line, Luis María Kairol López tells us, "Greetings from Yaranes Avilés, well, I'm sending you a greeting, and hey, you know I'm from Avilés, so if you want to send me a private message about something and we can go out for a beer or a glass of wine sometime, you know where to find me. You can write to me in any of my emails, even in this one I have here, okay? And what explains the more than 70% increase in net profit? I don't know exactly which company you're referring to, but you'll let me know. And G Yere, who tells us, "With Nagarro I've learned as much as I 've lost money. It was my first stock market investment, my first big rebound out." Well, the truth is that it's tough because obviously I can understand that the people who entered Nagarro at much higher levels when the company's dynamics were different, when the growth was different, when the narrative was clearly different. And the problem is that, of course, I imagine that from those levels you've eaten everything.
You've swallowed the change in narrative, you've swallowed the suppression of growth, you've swallowed the fact that bad news was coming. So, of course, it's down after down after down because of all those things we talked about. So, well, uh, let's see, we all have investments where we lose a lot of money, the key is to have others where you earn much more and compensate with these. So there's no need to beat yourself up over this kind of thing either. He tells us, "Yes, yes, I started at 80-90." Well, hey, considering what Cabo 80 90 is, it's not such a bad price, honestly, compared to what other people might have paid. And Chiver tells us, "How much I wish I could stop this?" Actually, Chiver, uh, there are rumors because an official number never came out, but if I remember correctly, uh, if I remember correctly, the rumor was €115 per share, if I remember correctly, uh, someone please confirm in the comments. But I think it was €115 per share, the rumor was, that's what had been offered for the share.
Okay, as I said, if someone who follows me more closely confirms it, I'll put it in the comments now before closing. But of course, obviously when you 're at 90 you don't want 115, but when you're at 40, well, 115 looks great, right?
Antonio Carrasco confirms this to us. Yes, 115.
Chiver herself says, "Yes, that's what I remembered." Hahaha, what a time. Yes, those were the days when €115 per share was like, "No, not this, we don't want this, this is too little." Okay, so that's it, we'll end today's video. Just so you know, a like helps us a lot. Leave us a comment, especially after the video has finished, it helps the algorithm a lot; people like it a lot and we reach more people. Hey, Momentum's Discord server, the link is in the description, you can find us there. This week, as I said, I think it's on Tuesday, Cipres and I from Nagarro are doing a 30-minute talk about the company, okay? So that's it, we'll leave it here and send you all a big hug and see you on the Momentum Discord server. I'm leaving with this.
Thanks Capid Chiver. Thank you so much for everything and see you, as I said, next Sunday. Hugs to all. Thank you.
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