Simulink simulation with continuous variables

I am simulating a feedback loop with a reference R = 2 and a plant that is a pure transport delay.

The output should oscillate between 0 and 2 like a square wave. However, I get this ramp from 0 to 2 instead of a vertical slope. I am using only continuous blocks, so I was wondering if this has to do with discrete simulation. I get the following warning:

Warning: The model 'untitled' does not have continuous states, hence Simulink is using the solver 'VariableStepDiscrete' instead of solver 'ode45'.

Thank you Hugo