Adecco Group Ag Unsp/Adr

Thank you for standing by. My name is Kate and I will be your conference operator today. At this time, I would like to welcome everyone to the ADECO group Q4 and full year 2025 results. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Benita Barreto, Head of Investor Relations. Please go ahead.

Good morning. Thank you for joining our conference call today. I'm Benita Barreto, the Group's Head of Investor Relations, and with me are the ADECA Group's CEO, Denis Machuel, and CFO, Valentina Fakao. Before we begin, Please take note of the disclaimer on slide two. Today's presentation will reference both GAAP and non-GAAP financial results and operating metrics. This conference call will include forward-looking statements, which are based on current assumptions and, as always, present opportunities as well as risks and uncertainties. With that, I will now hand over to Denis.

Thank you, Benita, and a warm welcome to all of you who've joined the call today. And let me open with a full year highlight on slide four. The group has consistently delivered on its ambitions and targets in 2025. In terms of market share, the group gained 245 basis points relative to key competitors with ongoing positive momentum. On a fuller basis, the group's revenues were up 1.3% year-on-year, gross profit was stable, and the group delivered an industry-leading 19.2% gross margin, evidence of the benefits of its diversification strategy. The group has managed costs and capacity with discipline. GNA overheads were further reduced by 23 million euros, bringing our total net savings to nearly 200 million euros when compared to 2022's baseline. And productivity increased 3% year on year. In turn, the group generated 693 million euros of EBIT A and stayed within the EBIT A margin corridor on a full year basis at 3%. Cash generation was strong with 102% cash conversion ratio, operating cash flow of 613 million euros and free cash flow of 483 million euros. Importantly, the group improved its leverage ratio, ending the year at 2.4 times net debt to EBITDA, down 0.2 times year-on-year, and down 0.6 times sequentially. Let's turn now to slide five. And on the left side, we highlight our consistent outperformance relative to key competitors across the past three years. And the chart on the right side shows volume steadily improved throughout the year, with flexible placement and outsourcing volumes in the ADECO GBU rebounding from decline to growth. Management's focus on customer satisfaction, digital innovation, and recruiter productivity, integral to our strategy, is driving strong top line and volume momentum ahead of market trends. Let's move to slide six. Where we set out the progress we're making with a run and change agenda, strengthening execution muscle across operations day by day, while investing in digital solutions and new services to drive future growth. There are many points on this slide, so let me highlight only a few. Beginning with a strength and run priorities. The group has made significant progress in 2025. The ADECO North American turnaround gained traction. Full-year revenues were up 12% and the EBITDA margin expanded to 130 basis points year-on-year. In line with the group's digital strategy, ADECO further expanded its talent supply chain approach to 144 large clients, adding 42 into four alone. By centralizing, automating, and digitizing processes effectively, the talent supply chain delivered a meaningful 550 basis points on your improvement in field rates. In accordance, restructuring in Germany has locked in 58 million euros run rate savings. And LHH's career transition business continued to successfully expand in the SME segment increasing the number of companies served by 17%. The group's change agenda also progressed. ADECO now has six recruiter agents live within the talent supply chain structure in the UK and in France. The UK agents have achieved approximately 15% time savings in recruiting processes, and this is an encouraging start. And we will roll out agents across key markets in 2026 to scale these benefits. And while there is further work to be done in Accodis Consulting, France's value creation plan improved performance with the unit growing ahead of market and achieve a 7% margin run rate up 160 basis points year on year. And in LHH, Targeted investment in Ezra digital coaching platform drove 42% revenue growth and a record pipeline at your end. Moving to slide seven. On this slide, we detail the firm progress made in the turnaround of Aquadis Germany. Management took decisive restructuring action in 2025, achieving 58 million euros in annual cost savings on a run rate basis by year end. This included reducing the cost of sales by 43 million euros and FGN expenses by 15 million euros with 8 million euros saved through real estate consolidation across 26 locations. Last wave of right-sizing effort is in flight lowering headcount by approximately 600 in total. In addition, select non-core assets were exited, eliminating approximately 3 million euros of negative EBITDA. The program incurred one-time charges of 46 million euros in 2025, but has already delivered around 15 million euros of in-year P&L benefits. As a result, Accotis Germany achieved a healthy 5.4% EBITDA margin run rate at year-end. The group expects incremental savings to crystallize in the P&L during 2026, in particular during H1. With the organization being right-sized, management's focus in 2026 will shift to rebuilding the top line supported by encouraging new client wins across sectors such as aerospace, defense, and life sciences. In short, the group has made strong progress in stabilizing ACODES Germany, positioning it for sustainable profitable growth going forward. Slide eight sets out the board of directors dividend proposal. We are retaining our attractive shareholder remuneration with a dividend of one Swiss franc per share for fiscal year 2025. This represents a 46% payout ratio in line with our established dividend policy of paying out 40 to 50% of adjusted earnings per share. Shareholders will have the option to receive the dividend either in cash or in newly issued shares. With this proposal, the group provides attractive returns to shareholders, including the option for qualifying shareholders to participate in the group's future growth in a tax-efficient way. The optional script dividend aligns with and supports the group's capital allocation priorities, which remain unchanged. It allows shareholders to increase their investment in the ADECO Group while enabling the company to retain cash for growth and prioritize debt averaging. Now, let me hand over to Valentina for the Q4 results.