Fnac Darty Sa Ord

Good evening and welcome to...

We're part of a unifying and highly rewarding movement. Returning to our performance to the end of September, it's in line with the dynamic results we've posted since the beginning of the year. ...varied offerings, product innovation, and high-value added services. These services continue to win over our customers and are making a significant contribution to our growth. We're approaching the closing of the offer to acquire UniEuro. We are convinced of the value creation that this unique strategic opportunity will bring to our group and stakeholders, I believe, in the success of this translation, which will enable us to confirm our position as European leader in specialized distribution. Over to Jean-Brieuc Le Tignan. Thank you. As Enrique has already mentioned, we're very satisfied with our performance this quarter. thanks in particular to the high single-digit growth of our services business. Over the first nine months, we posted sales growth of 1% on a reported basis and virtually unchanged on a like-for-like basis with market share gains in most of our categories. In the third quarter, the group posted sales of 1.8 billion euros, up 0.3% on a reported basis and down slightly by 0.8% on a like-for-like basis. The gross margin rate excluding the dilutive impact of the franchise and changes in the scope of consolidation, rose by 50 basis points over the first nine months of the year and by more than 100 basis points in Q3. Now, let's take a closer look at sales performance by channel, region, and product category over the period. First, by channel, the proportion of online sales remains high at 21%. The complementary nature of our shops and our digital platforms has once again increased. been demonstrated with click and collect accounting for more than half of online sales at the end of September. Now, by geography, the France-Switzerland region was virtually stable over the first nine months on an LFL basis. Once again, the group outperformed the French market, which remained in negative territory at the end of August, minus 2%, while our growth rate was virtually stable at the end of September, minus 0.4%. I'd remind you that the scope The effect corresponds mainly to the closure of three Manor shopping shops in non-French-speaking Switzerland, which took place in the first half of 2024. Let's turn now to the Iberian Peninsula. Sales posted an excellent performance of 5.7% in the third quarter, giving growth of 1.8% in the first nine months of the year. A better macroeconomic situation in the region has supported consumption. In Portugal, the integration of media markets consolidated from the 1st of October 2023, is continuing. And today, the 10 shops have generated sales of around 75 million euros. Lastly, the Belgium-Luxembourg region reported virtually stable LFL sales over the first nine months. Sales are benefiting in particular from sustained growth in services.

Let's look at developments by category. Let's start with publishing products. Books performed very well, buoyed by the craze for new reading trends. This performance did not make up for the sharp decline in gaming, still impacted by a particularly high basis of comparison in 2023, but with a much lower gross margin. Services continue to grow in all regions, with the ongoing rollout of our subscription-based offers, and in particular the rollout of DottyMax and Fnac V-Digital. Technical products grew slightly over nine months. In Q3, telephony sales slowed due to new product launches that got off to a more gradual start than last year. Computers benefited from the continuation of the renewal cycle, and innovations began in the second quarter. Sales of household appliances are up. The excellent momentum in small electrical appliances continues, driven by numerous technical innovations and new product launches in the cooking, beauty, and floor care sectors. Sales of large electrical appliances, on the other hand, remain down. Last but not least, diversification has performed well, with solid growth in the games and stationary sectors since the beginning of the year. Finally, a word on gross margin trends. It's important to note that apart from the negative impact of the dilutive technical effect linked to the franchise and changes in the scope of consolidation, the gross margin rate is up by more than 100 basis points in Q3 2024 compared with 2023. This increase is mainly due to growth in services and a favorable product mix, confirming the relevance of the everyday plan. The group benefited in particular from strong momentum in services, small electrical appliances, and books. Overall, for the first nine months of the year, the group posted gross margin growth of plus 50 basis points, excluding the dilutive effect of franchising and changes in the scope of the consolidation and recap. On slide four, I would like to come back to the strategic project of uni-euro acquisition. The bid is open until October 25, and we are very determined and confident in our ability to make a success of it. Let me remind you that the offer price of around 12 euros per share represents a 42% premium of a uni-euro spot price on July 15, 2024. The premium is also 20% of the average of analyst targets prior to the announcement. This valuation was deemed fair from a financial point of view by the two independent financial experts appointed by uni-euro's board of directors. Finally, We've lowered the minimum threshold for acceptance of the bid to 66.67% of Union Euro's capital. This reflects our determination to successfully implement the tender offer. This project is a structuring one for our group for the years to come and will enable us to play a key role in the consolidation of the European market. With Union Euro, we would form a group with sales of over €10 billion, €30,000. 30,000 employees in more than 1,500 stores. It would also be a value-creating transaction for all stakeholders, and we expect to achieve over €20 million in full-year synergies from the massification of purchasing in all brands. Finally, this operation will preserve our financial flexibility to pursue our capital allocation policy. In conclusion, We approach the end of the year with confidence while remaining focused and rigorous financial management. We are seeing the first encouraging signs on the macroeconomic front with inflation falling and interest rates beginning to come down. These factors, combined with the remarkable performance of our services business, have led us to raise our guidance for full-year operating profit. We now expect recurring operating income for 2024 to exceed €180 million compared with at least €171 million previously. We're maintaining our target of a cumulative operating cash flow of around €500 million. and over the 21-24 period with $180 million in 2024. Finally, we're very focused on the success of the major end-of-year sales event, FNAC's 70th anniversary, the 50th anniversary of Dottie's Contrat de Confiance Black Friday and Christmas. We approach the end of this year with determination, convinced that the group has solid assets to create sustainable value. Thank you for your attention. Jean-Brieu and I are now available to answer your questions.