Carrefour Sa

Good day and thank you for standing by. Welcome to the CAFA full year 2025 webcast and conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to have the conference with your first speaker today, Mr. Bompard, Chairman and CEO. Please go ahead.

Merci. Good evening, everyone. Thank you for joining us for the presentation of our 2025 results. As you know, we look forward to welcoming you tomorrow morning in Massy for the presentation of our new strategic plan. Today's call will mostly focus on 2025 achievements. On a strategic note, we accelerated our portfolio reshaping, taking full control of Carrefour Brazil, disposing of Carrefour Italy, and signing an exclusivity agreement last week regarding Carrefour Romania. If I come to operations, we pushed our transformation and our investments forward in our three key countries, and we released today financial results that show steady delivery. In a nutshell, our performance was solid, with good commercial dynamics in France and Spain, a growing recurring operating income, excluding CORA, and a strong cash flow generation. If we deep dive on our three main countries, Carrefour France, CORE delivered another outstanding year. We continued to invest in our commercial model and in price, narrowing the price gap with the market. These efforts were recognized by customers with satisfaction continuing to improve year on year on NPS up by three points in Q4. In parallel, we opened a record 456 new convenience stores, driven by a record number of new partners joining Carrefour. We also continued the conversion of hypermarket and supermarkets to franchise and lease management models. As a result, our group's market share increased over the year with a clear acceleration towards year-end, reaching 22% its highest point since 2015. This performance was achieved while maintaining strict cost control and capturing purchasing synergies enabling Carrefour Core operating margin to reach the 3% milestone. Coming to core and match integration. In 2025, the group rolled out its commercial model by implementing significant price cuts in the former Core Hypermarket, substantially increasing the share of Carrefour branded products in the assortment, underlining the promotional policy with the dancer promotional intensity of Carrefour stores. On one end, these initiatives had a temporary impact on France operating results with a negative effect of 120 million euros over the year. On the other end, these initiatives helped revive Coral Match with growing traffic on market share momentum towards the end of the year. Overall, we confirm our synergies target at 130 million euros for 2027. To finish, in Q4, Carrefour France sales were slightly up in the market marked by consumer trade downs on festive products. In January 2026, Public data confirmed that the environment was back to a positive trend. Let's move to Spain. In Spain, we benefit from a solid momentum in a dynamic market. Food sales showed strong growth, up 2.3% in 2025, driven by fresh products. Non-food sales are also positive. We continue to strengthen our price leadership and we have reached our best position in the market since 2022, while further expanding our convenience store network. As a result, profitability increased by 13.5% in 2025, driven by both retail and financial services, with an improvement of 45 bps in profit margin. Let's move to Brazil, our third key country. After a strong 2024, the Brazilian market is facing a challenging environment marked by record high interest rates and negative volumes, particularly in the cash and carry segments. In this context, our strict cost discipline helped protect margins. In Q4, inflation was lower and led to purchasing power gains. As a result, volumes were more resilient from mid single digit negative into free to low single digit negative into four the ongoing volume improvement in january seems to indicate that the cycle 12 is now behind us in total our group continued to execute on its transformation roadmap we strengthened our price competitiveness and customer satisfaction, and delivered solid progress across all our key operational priorities, particularly in private label and e-commerce. At the same time, our cost savings plan remains fully on track, delivering 1.1 billion euros, excluding Italy in annual savings as planned. As a result, Recurring operating income increased by 2.2%, excluding current match. EBITDA was stable on net free cash flow amounted to 1.5 billion euros, excluding Carrefour Italy. Beyond financial performance, we also delivered strong results on our social and environmental commitments. We achieved a CSR index score of 113%, In particular, our top 100 suppliers program continues to deliver progress. 87 of our industrial partners are now fully aligned with a 1.5% degree trajectory. Reflecting the solid performance, we will propose to increase the ordinary dividend to 0.97 euros per share in line with our guidance of a 5% increase. Following the disposal of Romania, on subject to the completion of the transaction, the payment of a special dividend of €150 million will be proposed. To conclude, building on our financial performance and commercial achievements in 2025, we approach 2026 with confidence in both the underlying market dynamics and our model's ability to capture consumption momentum. And I will leave the floor to Mathieu for more details on our financial results.

Thank you, Alexandre, and good afternoon to everyone. It's a pleasure to be with you to cover our 2025 financial results in detail. Let's start on slide eight of the presentation with the details of our Q4 sales. Total sales for the quarter reached 24.3 billion euros. Like-for-like sales were up 1.6% over the quarter. Expansion and M&A had a negative contribution of minus 0.7% over the quarter, which includes perimeter adjustments in Brazil, notably after the divestment of National and Bonpresso stores. Forex had an unfavorable impact on total sales growth of minus 2.3% over the quarter, essentially reflecting the depreciation of the Argentine peso and the Brazilian real versus the euro. Moving to slide 9, recurring operating income for the group amounted to 2,158,000,000 euros, or 2.6% of net sales. As you can see, this full-year recurring operating income is penalized by two effects. First, a negative forex effect of minus 102 million euros, and then the effect of the consolidation and integration of COHA and MATCH, which posted a recurring operating income of minus 120 million euros over the year. This figure includes 95 million euros of non-recurring integration costs as planned and guided. Restated from these two effects, recurring operating income shows growth in absolute terms and at the percentage of sales. Let's turn to slide 10 with more details on the performance of France. At 0.4%, like-for-like slowdown in Q4 in France compared to Q3. This is due to the market slowing down with consumers trading down on festive products during the Christmas campaign. This was a surprising trend that did not continue in January as evidenced by Syrcana data. Syrcana indicates that volumes in the market were down 0.4% in November and down 0.7% in December and turned back to positive in January at plus 1.2%. Cora and Match still weighted on Like for Like with a decrease in the average product price following price investments. Excluding core and match, like-for-like sales grew by 0.8%, supported by food sales up 1.3%, with an encouraging trend in hypermarkets where food sales increased by 0.8% in Q4. The convenience format continued to boast a solid performance. In parallel, we continued to expand with 107 new convenience stores opened in the fourth quarter. Over the quarter, Carrefour maintained a stable market share and managed to further grow NPS by three points. Excluding Cora and Match, recurring operating income for the historical perimeter grew by a strong 11.3% in 2025, with a margin expansion of 31 basis points, reaching 3% of sales. Let's move on to slide 11 with more details on Cora and Match. First, as we shared last October, the integration process for CORE and MATCH has been completed in Q3. Total integration costs are slightly below initial targets, a sign that the integration process has been well controlled. Integration OPEX totalled 145 million euros versus 150 million expected. and integration capex amounted to 85 million euros versus 100 million expected. Recurring operating income was a negative 120 million euros for CORA and MATCH in 2025, including 95 million euros of non-recurring integration costs. Excluding these costs, recurring operating income would have been minus 25 million euros in 2025. This figure has suffered from a decline in gross margin rates versus historicals. As you know, we deployed Carrefour's commercial model within the ex-CoA stores over the summer of 2025. We aligned prices with Carrefour's, which were 6% to 7% lower. We rolled out Carrefour private levels, leading to a 10-point increase in private levels penetration. And finally, we deployed CAS4's more intense promotional model. We have buying synergies to compensate for a great part of this investment, but overall, this new commercial model weighs on gross margin of Korean match. While this is a short-term headwind on our financial performance, we are already seeing a positive reaction from our customers with the number of tickets up 2.9% in Q4 and market share gains since December, and an improvement of 20 points in the Net Promoter Score following the integration. With this trend, we are confident in the dynamic for 2026. With this trend and cost synergies progressing well, we confirm the objective of €130 million of synergies by 2027. Moving on to slide 12, you can see the evolution of recurring operating income in France for our legacy perimeter. We have consistently increased recurring operating income, both in absolute terms and in terms of operating margin, since 2018. In 2025, we have reached the 3% mark, up 31 basis points. This long-awaited milestone is a confirmation that all the initiatives implemented in the frame of CAR426 namely on private levels, e-commerce, cost, and franchise, are making their way to the bottom line while allowing for further price competitiveness. Let's now talk to our European operations outside of France on slide 13, where we have delivered a solid set of results characterized by improving profitability and resilient top-line growth. Like for like sales in the fourth quarter, grew by 0.9%, closing a full year of positive momentum with full-year like-for-like up 1.2%. This was achieved despite a contrasting landscape across the region. Performance was led by Spain, posting 2% like-for-like growth in Q4 on the back of a solid market showing both positive inflation and volume growth. Carrefour Spain maintained a strong momentum on the back of commercial initiatives that are resonating well with customers. In Belgium, the environment remained challenging, yet our operations have shown resilience. We landed Q4 at a slight positive of 0.2% like-for-like, securing full year growth of 0.8% like-for-like despite persistent competitive intensity. Romania also remained in positive territory with plus 0.5% like in Q4 and 1.5% for the full year. Finally, regarding Poland, the market remained highly competitive and was marked by a slowdown in volumes. Looking at recurring operating income, Europe grew by 3.7% to 481 million euros, up from 464 million in 2024. This translates into a margin expansion of 9 basis points to 2.4%. The improvement was primarily driven by a strong increase in profitability in Spain, which combined with a sound execution in Belgium, more than offset the headwinds we faced in Poland and Romania. Let's move to slide 14, with a focus on Spain, where we continue to see a positive and dynamic market, driven by both positive volumes and prices. Spain delivered a strong performance this year, confirming its role as a key growth engine for the group. We continue to invest in price over the second half, reaching our best positioning since 2022 and reinforcing our price leadership in the country. We maintain solid commercial dynamics underpinned by our sustained price leadership. Food sales grew by 2.3% on a like-for-like basis. This was powered by a strong performance in fresh products, where our focus on quality and availability is clearly paying off. Carrefour Spain also posted positive growth in non-food, up 0.7% like-for-like. This strong commercial activity has translated into material improvements in our financial results. Recurring operating income increased by 13.5% to 463 million euros, with operating margin up 45 basis points to reach 4.2%. Moving on to Latin America on slide 15. We faced a challenging environment last year characterized by volatile macroeconomic conditions and currency headwinds. In Brazil, our like-for-like performance was broadly flat in Q4. This primarily reflects the slowdown in inflation and a difficult backdrop as record high interest rates have continued to penalize the market and particularly the cash and carry segment. However, we have seen encouraging signs in the underlying trends as food volumes sequentially improved from mid-single-digit negative in Q3 to low-single-digit negative in Q4. There was sharp deflation on certain commodities in Q4, helping partially restore household purchasing power. The retail segments showed again more resilience, with food sales growing by 4.3% like for life, with positive volumes notably driven by our commercial strategy towards B2B customers. In the meantime, we stabilized sales at Sam's Club, and we continued to grow our e-commerce business by 41% in Q4. In Argentina, Carrefour delivered 24% like-for-like growth in an environment that remains marked by pressure on consumption. We have successfully strengthened our leadership. We achieved steady market share gains throughout the year in both value and volumes. In terms of recurring operating income, our performance in Latin America remains stable year-over-year at constant exchange rates. The decline in the reported figure is entirely attributable to a negative currency impact of minus 101 million euros in the region. Brazil delivered a recurring operating income of 790 million euros and 4% of margin. Margin was down 7 basis points on the back of negative volumes and price investments compensated by cost savings. Argentina contributed €70 million to the group recurring operating income, compared to €115 million in 2024. All in all, while the context in Latin America remains demanding, our market leadership allows us to navigate these cycles with resilience. Coming to our global P&L on slide 16, our gross margin rate came down 22 basis points, reflecting our continued investment in prices and the structural shift of our business models towards more franchise-operated stores, which naturally impacts the gross margin rate but is accretive to recurring operating income. Our strict financial discipline continued to yield results, SG&A expenses, stood at 14.4% of sales, an improvement of 16 basis points compared to last year. As mentioned previously, the integration of core and match had a short-term dilutive effect on the operating margin. If we exclude this scope to look at the core performance, Carrefour's recurring operating margin actually expanded by 13 basis points to reach 2.9% for the year, meaning that our core profitability improved demonstrating the structural dynamic of our model. Turning to slide 17, let's walk through the P&L items below the operating line. Non-recurring expenses decreased to 62 million euros, reflecting lower restructuring costs this year. Cost of debt remained stable. Other financial income and expenses normalized this year after 2024 was impacted by Forex volatility and costs related to dividend payments in Argentina. The tax charge amounted to 516 million euros compared to 302 million euros in 2024. The increase compared to last year is driven by three main factors. The increase in our pre-tax income, the temporary extra corporate tax for large companies in France, and certain non-deductible expenses in 2025. Net income from these continued operations was minus €657 billion, mainly corresponding to the exit of ETH. So bottom line, adjusted net income group share reached €1,090,000,000. This translates to an adjusted EPS of €1.60 for the full year 2025. Now let's move to the net free cash flow on slide 18. We generated €1,565,000,000 in 2025, excluding the impact of Italy, which was a negative cash flow of €260 million. That number for Italy is higher than the €180 million negative for 2024, mainly due to the closing date of the sale. Indeed, as we closed at the end of November, we did not capture the traditional positive cash generation of December. This was compensated by a lower cash contribution to the disposal, as I will detail in the net bridge in a minute. Besides, the cash flow profile for the year was driven by the following elements. First, a normalization of our financial results after being impacted by the negative effects in Argentina in 2024. Second, lower restructuring cash outs, which decreased to 189 million euros. Regarding working capital, the contribution also normalized at 263 million euros. As anticipated, this is much lower than the exceptional inflow recorded in 2024. We are now back in the 100 to 300 million euro range of annual contribution to cash flow as guided. Regarding inventories, the level decreased by 1.2 days in total. Finally, CAPEX was reduced to €1,523,025 on the back of lower investments in non-core countries as we posed on a number of projects during the strategic review. Net free cash flow excluding real estate CAPEX and disposals is provided on slide 19. Carrefour generated net real estate proceeds of €264 million in 2025, slightly up from €227 million in 2024. Disposals were actually slightly down at €517 million. Real estate capex were reduced in 2025 on the back of a slowdown in expansion in Brazil. excluding real estate, net free cash flow totaled a bit more than 1 billion euros in 2025. On slide 20, we look back at our initial assumptions for full-year cash flow as shared with you in July. As you can see, most parameters came exactly in line with our expectations. As already commented, EBITDA was only stable when we expected growth, Core hand match and weaker markets in Q4 in France and Brazil explain most of the gap. Reversely, our capital expenditures came below initial outlook as we decided to slow down our investments in perimeters under a strategic review. Moving on to total net debt on slide 21. Net debt amounts to close to 4 billion euros on December 31st, 2025. Net free cash flow over the last 12 months amounted to 1.3 billion euros and covered dividend payments and tax paid on 2024 share buyback for a total of 866 million euros. M&A was an outflow of 106 million euros, including the acquisition of minority interest in Brazil. Finally, the sale of Carrefour Italy impacted net debt by 181 million euros, a lower amount than the planned €240 million cash injection due to the closing debt and working capital variation. Let me now detail a few numbers relating to the disposal of Carrefour Romania on slide 22. This transaction is based on an enterprise value of €823 million. This implies a valuation multiple of 4.8 times 2025 EBITDA which we believe is an attractive valuation of the asset. You will note that operating margin was 1% in 2025 and net free cash flow was a negative 53 million euros. The closing of the transaction is subject to customary regulatory approvals and is expected to take place in the second half of 2026. A quick word now on capital allocation on slide 23. Carrefour continues to follow its disciplined capital allocation strategy, ensuring strong shareholder returns and maintaining a strong balance sheet. At the upcoming AGM in May, we will propose an ordinary cash dividend of 97 cents per share, reflecting a 5.4% increase compared to last year. In addition, subject to the closing of the disposal of Carrefour Romania, we will propose a special dividend of 150 million euros. These 150 million euros represent roughly 30% of the enterprise value, excluding IFRS 16. These 150 million euros represent 21 cents per share, bringing the total dividend to 1.18 euros per share. This represents a cash yield of approximately 8.3% on the basis of the share price as of December 31st, 2025. This concludes my presentation. I thank you for your attention. Alexan and I are now available to take your questions.

Thank you. To ask a question, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. We will now go to our first question. One moment, please. And our first question today comes from the line of Sridhar Mahankali from UBS. Please go ahead.

Sridhar Mahankali Hi. Good afternoon, Matthew. Alexandre, thanks for taking my questions. If I can maybe get you to help us with three things. In terms of the outlook, you made some qualitative comments. There is consensus expectations out there for 2.4 million of ROI. is that consistent with what you see in your qualitative comments so that's the first question and secondly spain if you could just explain a little bit more is a big step up in the second half performance it looks like i think spain was up nine percent in the first half and now it's up 13 14 percent was there anything to do with the base i.e provisioning in the financial services a year ago being higher and not as high this year if you could just explain what else drove that really strong commercial performance in Spain and thirdly just very quickly on France you've talked about improving position underlying market share still seems to be grinding rather than firmly moving forward. Clearly, externally also, your price position has improved over the past 18 months. Is this enough, or do you need to do something materially different in France to move back to firmly gaining market share? Thank you.

Thank you for the series of questions.

Maybe a few words on 2026, even if the main points will be developed tomorrow morning. But just to answer your question, we are confident in 2026 for a number of reasons. coming from a good market outlook, solid underlying business dynamics at Carrefour, and supportive technical swings. So if I jump to the business outlook for the key markets, we do think that France has delivered a very solid performance when analyzed with those current match. based on our own strategy, but also on a solid French market that turned positive two volumes since Q2. We have positive volumes in the French market since Q2. It remains extremely rational as we had expected, and we anticipate the same kind of market trends for 2026. And the initial numbers for January reinforced our confidence. The public data showed that volumes are positive in January, while it was negative in December because of trade-off on festive products. So that's for France. Spatial market was very solid last year. probably the best in continental Europe. We have a very, very good level of competitiveness. We are a price leader and we reinforce our price leadership. We see no reasons for a change in business trends there, but very solid macro drivers. And we see no reasons why we wouldn't continue to reinforce our leadership in France. So we are very positive in Spain. Last, Brazil. So the conviction we have is that we probably turn the corner in Brazil with the Macron. Volumes were better oriented in Q4, low single-digit negative while mid-single-digit negative in Q3. As Mathieu said, we saw a decrease in commodity prices, which are an important part of our sales. It has strengthened our customers' purchasing power. And I would say, besides, we know by experience that election years often mean government support to consumption. which should also help. So we really think we have turned the corner in Brazil with macro, and we have good prospects for 2026. Of course, it is reinforced by our price leadership, also by the cost-saving plans we have developed throughout the year. So the outlook of the market and the good business dynamics of Carrefour convinces that the 2026 would be positive. Besides, we have a bunch of positive technical. The integration cost of co-op match are now behind us. They are complete. Since the end of the year, we see that the stores are ramping up. Better tickets, better market share, better like-for-like. as well as the synergies, and we do think that the year will be positive in terms of recurring operating income for Cora. Last one, the additional 75 million reduction in cost of debt thanks to the restructuring of the Brazilian debt last year. So, all in all, you see that we have a good level of confidence with the market on our own business dynamic, reinforced by technical swings. So that's for the outlook. For Spain, you're right, the trend was very positive in the second part of the year. To be honest, we see this trend for a few quarters now. The team has made a very good job to reinforce the price positioning. The market was positive in Q4. Same thing in January, so we have good level of comfort about our situation in space. and financial services contribute to the improvement of the recurring operating income also. When I come to your last question about France, we won't change what is working, and the conviction we have is that we invested the right amount to stabilize our market share, including Core and Max in Q4. We plan to continue to invest in prices to drive more customers back to our stores and to retain them. We can finance that through our cost savings dynamics on the World Bank Alliance Concordia, and we will talk more about this tomorrow morning.

Gaurav, just really to follow up, I'm trying to understand if that confidence equals to or is consistent with the expectations out there for 2026 operating profit, or do you think it's a bit too early to talk to a consensus number in the year?

Let's keep it for tomorrow, Shredda. There will be much more granularity given, including on 26, and so let's keep it. Thank you. Thank you. Thank you, Shredda.

Thank you. We will now take the next question. And your next question comes from the line of Xavier Lemene from Bank of America Securities. Please go ahead.

Yes, good evening. Thank you for taking my question. Two, if I may. First one, can you give a bit more color on the 30-bit margin improvement you've seen in France. So what was really the operating leverage that you've seen? Is it about volumes, cost savings, a combination of two? But can you potentially explain a bit more, give a bit more granularity on this 30-bit margin improvement in France, excluding, of course, CORA and the match? Second thing, we... heard in the press that you would be potentially considering the disposal of some of the CORA stores. So any comment there? Are you happy with the 60 hypermarket that you've got there? And the last comment, question is, can you give us, you know, the amount of synergy that you had for CORA in 2025? Because I think that is for the small positive, but how big was that?

Thank you for the question. So you're right.

In France, it's a very important milestone for us to reach 3% profitability. We have doubled this number in a few years. And that's the result, I would say. And this year also, it's a very constant strategy. This year, we have delivered high level of cost savings in France. It has enabled us to have a good dynamic in terms of market share in volume. The market was positive in volumes in 2025 and it will be in 2026. We have a good dynamic on e-commerce. We have a good dynamic also on convenience store with a record number of opening this year. All in all, it has enabled us to reach this very important milestone, which is the result of a very steady and constant strategy we are leading.

On Quora stores, there's been rumors that there were discussions on a very small number of stores. We're thinking about the perimeter, which is, again, just a handful maximum of stores, which is quite typical when you have made an acquisition. We are just checking these stores. will create most value in our network or in another network. But it's just high level so it's no decision taking.

Can you, Xavier, repeat your third question? Yes, it was just about the synergy with COHA in 2025.

You saw a chart where you obviously benefited already from some of the synergies in 2025, just to estimate what the amount was.

So, as you saw on the graph, there's no specific amount. What's interesting is, so it's a relatively small number so far. to make it more interesting, which is a mix of, in fact, quite good cost synergies, and the work has been done very well there. But this is compensated by negative, so far, commercial synergies, as you saw on the recurring operating income. So the net amount is relatively small so far. But as far as 2026 is concerned, we're quite comfortable because again, the commercial dynamic is improving very, very quickly and the cost dynamic is here and it's just going to be reinforced. So that's why we have quite good level of confidence and even visibility on the ramp up of the synergies for 26 and good level of confidence for 27 because we see that the underlying trend is here. It's gaining traction and customers are clearly accelerating their visit and even sales despite price decrease, even sales at tax cost.

Thank you.

Thank you. Your next question today comes from the line of Francois Degas from Kepler-Chivre. Please go ahead.

Good morning. Thank you. Good afternoon, sorry. Thank you for taking my question. First, on the convenience stores, like for like in Q4, it's a bit weaker than it used to be. Is there any trend, anything to comment on that? That's the first question. Then, could you highlight the moving part of your cost of debt with minorities buyouts financing on one hand but the refinancing in brazil starting to contribute on the other hand on what should we expect in terms of level of financial costs next year on third if i may it was quite surprising to see the capex going dead could you help us to understand what is underlying in diamonds what is here is there to stay on How do you consider that in percentage of sales, for instance? What do we have to keep in mind for the future, whatever the parameter is going to be? Thank you.

Thank you. I would take very quickly the first. Nothing new on the dynamic of convenience. I would say... Maybe only the fact that they have probably suffered a little bit also by the trade-off on festive products at the end of the year, but the dynamic of the year has been very, very good, and the number of new stores, the commercial dynamics, the implementation of the new concepts,

uh that that we have tested this year is very positive so so everything is positive with the convenience on the fixed special not on the commercial dynamics into form on your second question uh regarding financial expenses um so indeed the um the um so we're expecting as planned an additional 75 contribution to net free cash flow, which is a post-tax number for 26. We already had 25 captured in the 2025 cash flow. So the net cost of debt, really that sub-line for 2026 is planned to decrease quite significantly With that number, growth of tax impacting the line. Then capex. So a number of arbitrage have been made during the year. So first, expansion in Brazil has slowed down. It has slowed down in the markets on the back of the environment. that we described. It has also slowed down at Carrefour, and we know that this expansion at Atacadao is quite costly as there is some real estate involved. We have also cut a number of projects and developments on the capex of the smallest countries as part of the strategic review. We said that it was meaningful to make sure we had just the right and minimum level of CAPEX in these markets, given the review undergoing. And then in France, we increased the CAPEX. You will see that in the detailed numbers. We increased the CAPEX. As Alexandre announced at the beginning of the year, we want to invest more on two main topics. was transformation of the stores and development of some commercial concepts, and we'll talk more about that tomorrow. So we have invested more on that, and we have also invested more on our logistics, which was also part of the plan, to ensure smooth efficiency of our operations and also reduce our logistics costs.

Merci, François.

Merci.

Thank you. We will now go to the next question. And your next question comes from the line of Geoffrey Michelet from OdoBHF. Please go ahead.

Thank you for taking my question. I have two questions. First one is on capital allocation. What was the driver that led you not to do a new share buyback? I mean, how do you intend to use the Romanian proceeds since you will spend only, let's say, 30% of the proceeds in exceptional dividends? And the second question is on the relation with the unhappy franchisee in France. We've seen reports in the press. My question was, how is your feeling or thought as of now with the latest development? Thank you very much.

Thank you very much, Geoffroy. So indeed, no share buyback. We still know that we have this tax in France, which impacts us significantly. Then it's a relatively small amount, this €150 million. So like we did last year, we have elected for a special dividend. Then Romania, so we wanted to have a portion of the proceeds to come back to shareholders as the valuation was quite a good one. The rest remains on the balance sheet, will remain on the balance sheet. for flexibility and a number of opportunities, and so that will be discussed also tomorrow as part of the capital allocation section of the strategy plan.

On your second question, you know the main numbers. We opened almost 500 new stores this year. thousand candidates to to to new franchise stores we are not far from six thousand stores in france so the the the the convenience of the stores for the franchise is working extremely well we have this uh this disagreement with a a site number of franchisee uh I regret that, as we've already told, the door is always open to discuss and to find a definitive agreement. And I'm sure that in the future we will manage to do that.

Thank you very much. Thank you.

Thank you. We will now take our final question for today. And our final question today comes from the line of Rob Joyce from BNP Paribas. Please go ahead.

Hi, good evening. Thanks very much for taking my questions. Three from me as well. So the first one, just to understand the base and how we think about profit growth in France. So I think originally CORA was going to be 75 million of recurring costs in ROI. Is this now 145 million just to confirm? And then do any of these reverse next year? And should we be thinking of Cora? Do we have any more costs to incur in 26 or is it growing profits from here? Second one is just thinking about that free cash flow target I think you had of 1.7 billion for 2026. Just want to understand if that's still one you're confident in achieving. And then the final one, potentially related, just in the main release, there seems to be quite a lot more disclosure on factoring of receivables. Now mentioning France as well as Brazil on a total balance of around 1.4 billion in factored receivables. Can you talk us through what you're doing in terms of factoring receivables and how this impacted the working capital in 2025? Thank you.

Thank you, Rob. So first question on one of, so I mentioned, so I refer to page 11 of the presentation. So I think that there's two elements. So first, the total amount of integration OPEX accounts recorded on H224. and full year 2025 indeed amounted to 145 million euros. That compares to an initial guidance of 150 million euros. So, as I said in my speech, we have very well controlled that amount. Now, looking just at 2025, the extraordinary OPEX are just 95 million euros, which are accounted in the recurring operating income of minus 120. So let's be clear, integration is complete. There will be no more integration costs OPEX nor CAPEX next year. This is done. So now core and match is really a normal and going concern business. So that's why I flagged the minus 25 million for the year, X one-offs. I think this is the base. I've explained that we have some pressure from all the commercial investments that have been made. the commercial dynamics, which was by construction quite slow at the beginning, is ramping up. So we have much more positive prospects for 2020-26. Now, on free cash flow, so you're right, we have this... 1.7 billion euro target. So 2025 is at 1,565,000. There's a number of exceptionals in this number that I'd like to flag and which obviously will disappear. So for mixture, obviously the core and match integration cost of 95 million euro that I just mentioned will not be present. They have also waited on the net free cash flow. Then we will benefit from 75 million euro from the refinancing of Brazilian debt. And you may remember, I'm sure you remember, that in H1 we had a negative 80 million euro working cap impact at Cora. That was the first time that we consolidated Cora on an H1, which is typically a negative net free cash flow semester due to the seasonality. Obviously, that would be a part of the historicals in 2026. And so we won't have that effect. So this is all in roughly 250 million euros. So you see that the $1.7 billion is at site for 2026. We will come back in more detail on the outlook for 2026, as I said to Schrader tomorrow. Final question is on receivables. We started, as you flagged, to disclose the number of receivables which is sold. This is mainly, and I think we already commented on that in the past, this is mainly the credit card receivables that we have in Brazil. As you know, we have a few years ago started to accept credit cards. then used historically to accept only cash payments. Credit cards, you get the money after 30 days, so you have receivables that is created. And we extended the facility to three-time installments for our consumers, which is appreciated in the current environment. And so it means that we get the money after 30, 60, and 90 days, one-third each, obviously, creating more receivables. And so these receivables are sold, not entirely, but that's a way to finance the increase of receivables. We don't even sell all receivables, so we finance a little bit of it through our ABDA generation, but that's a financial resource that we use and that is disclosed in our financials.

And what's happening in France, Mathieu, in terms of the receivables?

We have some receivables relating to franchisees. So the bulk is in Brazil. Then we have some receivables from franchisees, same thing. we developed our activity with franchises with an increase of receivables. And so, again, a portion of the receivables is sold to financial institutions to limit the negative impact on the working cap.

And the year-over-year impact, just to round out the question?

So overall, selling receivables is neutral year-on-year. So it means that the increase in activity and increase in receivables is somehow negative on the net free cash flow of the year.

Thank you.

Thank you. That was our final question for today. I will now hand the call back to the room for closing remarks.

Many thanks to all of you. See you tomorrow to discover what's next. Thank you.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.