Icade Sa Ord

Now, hand over to Bruno to go through the financial results.

Welcome to the ECOD 2026 Half-Year Results Presentation Conference Call. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. You can also submit a written question. Now I will hand the conference over to the speakers, Nicolas Joly, CEO, and Bruno Valentin, CFO. Please go ahead.

Good morning everyone and thank you for joining us today. With Bruno Valentin, I'm pleased to present ECAD's 2026 half-year results. I will begin with the key highlights and strategic developments of the first half. Bruno will then take you through the financial results and the balance sheet in more detail. I will come back at the end with our outlook for 2026 before we open the floor for questions. So, let me start with the main takeaways from the first half of 2026. The first key message is the continued disciplined execution of our disposal plan. We completed the sale of the Marignon building on the Champs-Élysées for 402 million euros. In healthcare, an agreement has been signed relating to the disposal of the Portuguese portfolio, representing an exposure of around 75 million euros for ICAP. The second key message is the new step taken with ECHO. Last week, we announced the acquisition of the remaining 49% minority stake in the Tower, allowing us to regain full ownership of this landmark asset in La Défense. This transaction follows a significant asset management effort and comes after the Tower has been brought to full occupancy. The third message is the resilience of our operating performance. In property investment, close to 94,000 square meters were signed or renewed in the first half, and the financial occupancy rate improved to 85.9%, with office occupancy now close to 90%. In property development, after a softer start to the year, activity recovered well in the second quarter. Residential orders reached almost 2,400 units in the first half, Up 12% in volume and 6% in value year-on-year. The fourth message is the strength of our financial structure. We continue to benefit from a high level of liquidity which was further reinforced during the period through a new €150 million bond issue due in 2035 and the renewal of €450 million of revolving credit facilities. And finally, We confirm our 2026 guidance with group net current cash flow expected between 2.90 and 3.10 euros per share while 2026 should mark a low point for strategic cash flows. Turning now to the key figures for the first half. Group net current cash flow came in at 1.80 euros per share compared with 2.03 euros per share in the first half of 2025 which is consistent with our full year guidance. Net current cash flow from strategic operations amounted to 1.15 euros per share versus 1.44 euros per share last year, mainly reflecting lower net rental income in property investment and lower margins in commercial property development. NAB and TA per share stood at 49.7 euros, down 6.9% compared with year-end 2025, mainly due to the decline in property values and the distribution paid fully in June. At the same time, the balance sheet remained its own. LTV including duties improved slightly to 39%, from 39.6% at year-end 2025, while net debt to EBITDA remained broadly stable at 9.2 times. As expected, the average cost of debt increased moderately to 1.85%, reflecting the bond issues completed in 2025 and 2026. This increase remains controlled and we still target around 2% by year-end. At business line level in property investment, gross rental income amounted to €170 million, down 1.1% like for like. The portfolio values to that €5.6 billion compared with €6.1 billion at year-end 2025 reflecting both disposals and a like-for-like value decline of 3.1%. EPRANET initial yields stood at 5.4%. In property development, economic revenue reached €473 million down 5.5% year-on-year, mainly due to the expected slowdown in commercial projects. The current economic operating margin came in at 1.9% versus 2.3% in the first half of 2025. This reflects the lower contribution from commercial activity, which supported margins last year, while residential margins are gradually normalizing. Residential orders total 2,368 units up year on year. Let me now come back to disposals and capital allocation, which remain a central pillar of our strategy. Our approach remains highly disciplined. We execute disposals when pricing conditions are attractive with a clear objective, crystallizing value, reinforcing the balance sheet, and redeploying capital towards higher return opportunities. As you know, we completed in H1 the disposal of Marignon for 402 million euros after a competitive process, crystallizing a value of around 33,000 euros per square meter, More than 20% above the December 2024 NAE. Combined with previous disposal, we have now achieved more than half of the 1.3 billion euros disposal target set for property investment over the 2024-2028 strategic plan. Around 600 million euros remain to be executed over the remainder of the plan. In healthcare, we are happy to announce further progress. Premier Healthcare and EHE, the international SPV, have indeed signed an agreement for the disposal of the Portuguese portfolio. ICA's exposure amounts to 75 million euros. After this transaction and the steps already completed, around 900 million euros of healthcare exposure remain to be disposed of by the end of the plan. Let's now turn back to Marignon, which illustrates our disciplined approach to capital allocation. By selling the asset, we avoided refinancing at approximately 4.5% in the current interest rate environment. Over time, we will redeploy the proceeds into higher return investment opportunities, particularly in attractive growth sectors such as data centers and student housing. Let me now turn to the Portuguese Elscia transaction on page 12. The portfolio comprises four assets located in Lisbon, Porto, Albufera and Lagos. The portfolio is valued at 186 million euros, in line with the value reflected in ICAD's NAB as of December 2025. ICAD's exposure amounts to around 75 million euros, although the final allocation proceeds will be specified at a later stage. Closing is expected in the second half of 2026. To be noted that this transaction will have no impact on 2026 group net current cash flow as the contribution from non-strategic operations has already been secured through the dividend received from Premier Healthcare in the first half. Moving now to operating performance in property investment on page 14. We signed or renewed close to 94,000 square meters representing 32 million euros in annual headline rents with an average firm commitment of 8.7 years. Most of these transactions were completed in La Défense and Paris Défense area which continue to demonstrate strong attractiveness for occupiers combining quality assets, accessibility and competitive rental conditions. Our recent leasing performance is translating into improved operating metrics. At the end of June, the financial occupancy rate stood at 85.9%, up 0.9 points versus March, while office occupancy is now close to 90%. Page 15 highlights the renewal of our main 2027 lease expiry at Grand Tax in Nanterre. We successfully renewed 100% of the space, representing 58,000 square meters on the new nine-year firm lease with AXA. This is a significant achievement, both in scale and in duration, and it illustrates the quality of the asset, its accessibility, and the strength of our long-term tenant relationships. As a result, our teams have continued to improve the profile of our future lease maturities as shown on page 16. Our world increased by 20% to four years, and we have significantly improved visibility on our 2027 lease expiries. We indeed currently expect around 75% of the leases expiring in 2027 to stay, although this will of course involve crystallizing some negative reversion. Talking about that, potential reversion on the overall portfolio now stands at minus 7.1% compared with the minus 9.7% at the end of June, at the end of 2025, sorry. After factoring in the renewal of the major KPMG and AXA leases, potential negative reversion narrows to minus 4.4%. Slide 17 brings me to ECHO. In July, we took advantage of a good opportunity to acquire the remaining 49% minority state in the Tower. We now own 100% of ECHO, an iconic asset in La Défense, offering 79,000 square meters of office space, now fully let, following the KPMG lease renewal and the lease sign with the Haute-Seine Prefecture. From a financial perspective, this acquisition was completed at a yield of over 8% and is a creative to the group net current cash flow. The asset was already fully consolidated in the group's financial statement prior to the acquisition. Turning now to property development on slide 18. The first half performance in residential segments was satisfactory, despite market debt remains at historically low levels. Individual buyers also showed solid momentum, up 6% in volume and 5% in value, despite a market that remained sharply down by around 15% in volume. This resilience was complemented by strong bulk orders to institutional investors, which increased by 60% in volume and close to 9% in value. They accounted for 60% of H1 total reservations in volume terms. The slide 19 gives an outlook on future activity. Despite the still constrained environment due to municipal election, ECAD was able to rely on permits obtained at the end of 2025 to accelerate construction starts, which were up 63% year-on-year. These new projects display a high level of pre-commercialization above 80%. As of end of June 2026, total backlog stood at 1.6 billion euros, offering around 20 months of revenue visibility. Residential backlog remains stable and continues to support the business. As regards margins, we are seeing a gradual improvement in the quality of the portfolio. Operation with restored margin represented 37% of revenue in the first half, compared with 18% in 2025. This confirms the ongoing rebalancing of the portfolio and supports our expectation of a return to breakeven by year-end. Let me now turn to slide 22 and 23 to highlight some of our recent achievements in terms of new partnerships that will support future growth while remaining disciplined on capital. The first partnership targets the student accommodation segment. In July 2026, we entered into a strategic partnership with the Caisse des dépôts through a dedicated investment VI call, hold 51% by ICAD and 49% by Banque des Territoires. Over an initial three-year investment period of around 240 million euros, it's expected to be deployed with a target of around 2,000 beds. Two first projects have been already launched in Ivry-sur-Seine and Levallois-Péret, with delivery expected in 2028. We also launched Evolution Habitat together with Banque des Territoires and Caisse d'Epargne Île-de-France. These vehicles aim to convert vacant office buildings into residential developments primarily in the Paris region where the potential addressable market is significant at around 6 million square meters. At this stage, the partnership includes a three-year investment period with the ambition to deliver 50,000 to 60,000 square meters of refurbished space meeting high environmental standards. And with that, I'll now hand over to Bruno to go through the financial results in more detail.