Adecco Group Ag Unsp/Adr

Hello and welcome to the ADECO Group second quarter 2026 results call. Please note that this call is being recorded. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, please press star followed by one on your telephone keypad. Thank you. I'd now like to hand the call over to Diego Chantrain, Head of Investor Relations and Portfolio Strategy. Please go ahead.

Good morning and thank you for joining the ADECO Group's conference call today. I'm Diego Chantrain, the Group's Head of Investor Relations and Portfolio Strategy. With me are the ADECO Group CEO, Denis Machuel, and CFO, Valentina Ficaio. 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, Diego. And it's great to have you with us for your first quarterly results in your new role. And of course, a warm welcome to all of you who've joined the call today. Let me begin with slide three, which provides an overview of the quarter. Organic revenue growth remains strong In the second quarter, the Group's revenue rose 5.6% year-on-year on an organic, training-days-adjusted basis. We are also pleased to report that Accodes returned to growth this quarter and Valentina will elaborate on the good progress of the transformation program. The Group delivered gross profit of 1.1 billion euros, achieving a healthy gross margin of 18.6%. On a year-on-year basis, Organic growth margin was 20 basis points lower. Importantly, this was an improvement compared to 40 basis points lower in Q1. This progress is due to firm pricing, current client and country mix, and improving underlying trends. The Group's EBITDA excluding one-offs was 165 million euros, and 21% higher year-on-year on an organic constant currency basis, driven by consistent profitable growth. In turn, the EBITDA margin expanded by 30 basis points year-on-year to 2.8%, reflecting strong operating leverage and disciplined capacity management. The Group delivered an organic drop-down ratio of 64%, and adjusted EPS increased by 31% year-on-year. We remain firmly committed to deleveraging. The net debt to EBITDA ratio excluding one-offs was 2.7 times a 0.5 times improvement compared to the prior per year period driven by improved profitability. Moving to slide four. The Group's disciplined execution continues to drive further market share gains, also supported by improving market conditions. On the left-hand side, we show relative revenue growth. We have outperformed our main competitors consistently over the last four years. In the last four quarters, we have gained 320 basis points, and this quarter, we have delivered an additional 160 basis points of market share gains. Moving to the right hand side, we have started to see the first signs of stabilization in permanent placement with the gross profit gradually improving since the start of 2023 and more recently stabilizing from minus 7% in Q1 26 to minus 1% in Q2 26. In terms of operational KPIs, we see activity levels improving as evidenced by placements per FTE. We have seen this progress across several countries, including the US, Spain, and APAC, where permanent placement gross profit grew positively in Q2. I am encouraged by the signs of stabilization in permanent placements. If this trend continues, We would expect consultant productivity and placement volumes to drive positive operating leverage within the existing cost base. Let's turn to slide 5 now, which showcases recent client wins reflecting the Group's ability to expand our end-market penetration and capture new growth opportunities. First, Accodes signed a contract with a major player in the French defense sector, becoming the strategic partner for systems validation and qualification, cloud infrastructure, and security services. The client selected Accodes over the incumbent provider, valuing our deep account knowledge and global access to specialized digital and engineering talent. Second, The Group strengthened its position in a large-scale data center build-up by becoming the primary supplier and master vendor for major manufacturing and technology clients in the U.S. The client valued ADECO and ACODES's technology-enabled workforce solutions and rapid talent development capabilities to support the expansion of new facilities. with demand expected to exceed 1,500 engineering and technical roles over the next 18 months. Overall, the group's revenue in the U.S. data center and market has grown by 38% year-to-date. Third, LHH was selected by a global telecommunications client to deliver an AI reskilling program for over 1,000 former employees supporting career transition at scale. The client valued General Assembly's proven delivery model, AI expertise aligned with workforce needs, and its scalable online platform. And fourth, ADECO secured a significant win with a global automotive client, expanding its on-site workforce and optimizing operations. The client selected ADECO as its sole workforce management partner, recognizing our embedded on-site solution, Local regulatory expertise and digital capabilities. Collectively, these wins demonstrate the group's ability to help clients accelerate their AI and digital transformation agendas, leveraging our expertise, scale, and broad portfolio. Turning to slide six. AI is increasingly embedded into our core offering and day-to-day processes. It is now an integral part of how we serve clients, support candidates, and improve productivity across our organization. In Agentic AI, we're making strong progress. Our initial target was to reach 50% of ADECO revenue enabled by agents by year-end. We achieved that target already, At the end of Q2, with end-to-end agents live in 10 countries and have now raised our target to 70% of our revenue by the end of 2026. The impact is visible in our operating metrics. To date, our agents have completed 2.2 million conversations. We are seeing a 10% improvement in overall fill rate, a 40% reduction in time to submit, and 25 to 35% productivity benefits through Recruiter TimeSate. Right from the start of our AI deployment, we introduced a responsible AI framework built around five principles. Human centricity, safety, ethics, lawfulness and transparency. Our own research highlights that trust is a critical differentiator for successful AI implementation. This is why We remain strongly focused on responsible deployment and work closely with policymakers to support robust frameworks in our sector. By combining innovative solutions, responsible AI, operational discipline, and human expertise, we are accelerating our profitable growth and we're leading the human side of the AI transformation. Let me now head over to Valentina to share more details on the quarter's performance.