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Welcome to the Group SEB 2026 First Quarter Sales Presentation. Today's conference will be hosted by Stanislas DeGraw-Mong, Chief Executive Officer, and Olivier Casanova, Senior Executive Vice President and Chief Financial Officer. For the first part of the conference call, the participants will be on listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to the speakers. Please go ahead.

Good afternoon. Thank you for attending this call. I'm Stanislas de Gaumont. I will be managing this presentation together with Olivier Casanova, our CFO. We will start with a short presentation, I think, and then we'll carry on with answering all the questions you may have. Olivier, do you want to get started?

Okay. Thank you, Stanislas. So moving on to the key figures for the quarter. Our sales stood at 1,885,000,000, up 2.7% on a like-for-like basis. Offer stood at 72 million euros, up 42%, and operating margin was up 1.2 percentage point at 3.8%. So, moving on to the highlights on the next page, as I said, 2.7% organic growth. Of course, we have been operating in Q1 in an environment with a lot of uncertainty on the macroeconomic and geopolitical front. And, of course, it has deteriorated in the latter part of the quarter. We'll come back to that, no doubt, in the Q&A. In this environment, however, we have delivered balanced growth between activities and region, driven in large part by our innovation portfolio. OFA has increased year on year, of course, supported by a favorable base effect because the Q1 OFA of last year was low by historic standards, but also supported by organic sales growth and a decrease in operating expense. And finally, we have launched the rollout of our rebound plan, and it is progressing in line with the announced schedule. So moving on to the top line, so as I said, 2.7% organic growth. We have a currency effect of minus 3.8% and no change in scope because La Brigade de Buyer, which was acquired at the beginning of 2025, was consolidated for a full quarter. So let's describe briefly the currency effect. Of course, we have a negative impact from the depreciation of the CNY in the U.S. dollar. We all remember that they were actually quite firm in the first quarter of last year. And the CNY has depreciated year on year 6% and the U.S. dollar 11%. Secondly, we have also suffered from the depreciation of the Turkish lira and the Japanese yen. We can expect, in particular for the U.S. dollar and the CNY, of course, a lower impact later in the year given the depreciation that we experienced in 2025. Now let's look at the split of our turnover by business units. So our professional business unit had 231 million sales in Q1, up 1.1% on the like-for-like basis, and consumer sales stood at 1,654,000,000, up 2.9% on the like-for-like basis. So overall, as we said, a balanced organic growth, 1.1%, as I mentioned, of professional. And you can see that on the consumer side, it's also quite balanced by region with 2.5% growth in EMEA, 2.2% growth in Asia, and a hefty 6.7% growth in the Americas. So now I turn over to you, Stanislas, to cover these results in detail.

Thanks, Olivier. Let's look now at the detailed description of our activities for self-performance for activity, starting with the professional business where we experience a slight organic growth with an activity that is up 1% organically, which is very much in line with our Q4 2025 trend. What we can see on the less positive side is that a persistent client latency attitude. Of course, in the United States, this has not changed materially since the last quarter of last year, but also in the Middle East for obvious reasons, and that's intensified by the geopolitical context, of course. Yet, we see a continuation of the positive commercial momentum, consolidating our leadership in China with Luckin Coffee, our biggest customer out there, but also new contracts in the tea chain segment with a customer called Chapanda, which is progressively expanding, where we are progressively expanding our coverage. We also see new customers coming in in North America, a chain called Scooters of Restaurants. That's a very good customer for us. And last but not least, Europe has shown positive performance, driven in particular by the service business, which is more than elsewhere compensating the wait-and-see attitude on new machines purchase. We see and we are expanding our new growth levels. You know that by now that we've opened our Chinese hub in Chelsea for production and development of new coffee machines, new ranges of coffee machines. And the two first new models we've developed called Peak and Elevation have seen great reception, particularly in the small businesses and offices segments, be it in Asia or in Europe. Now, when it comes to the consumer business, Olivier was saying that we have a balanced organic growth with total consumer of 2.9%, EMEA of 2.5%, Asia of 2.2%, and Americas of 6.7%. And before going into the details of these performance, it's interesting to look at the innovations that drive this performance. The big hit of last year, the washer category with the extreme 10, which category we've reached 100 million euros in 2025. We launched last year and are expanding this year Aerosim, which is the first vacuum garment steamer. We have a great expansion of our titanium work in support in China. The big success of Q4 last year that is continuing into Q1 is Cookio Infinity, which is combining great multi-cooker programming and cooking programs together with air fryer function and the stirring function. And the last two newcomers in the market that have been launched in France in March are Pizza Pronto, which is an electric pizza oven outdoor, and Coffee Crush, which is a revolutionary bean-to-cup coffee machine, which again started in France in March and is really giving promising results at the start. But beyond products and product innovations, we've also moved forward in the way we interact with the consumers. We've made two kinds of great activities. We organized in early April in Paris a self-fashioned domestic show. with digital show and staging, showcasing our consumer innovations, staging products as iconic pieces with lights, music, narration, a very original way to portray and to display our products. We've done great stands on collections and immersion with product demos, with interactive experiences, with a gallery of innovations and bestsellers, outdoor spaces, conviviality and tastings. And last but not least, we have great following and attendance by influencers. We've generated premium content on-site that have boosted the visibility of those innovations. We had over 60 influencers with a cumulative reach of 16 million people. And in the very day of the event, we had already 1 million views on content generated that day. So that's what we did generally to introduce our innovations in France. But we also did a very specific, dedicated event for the Coffee Crunch lunch. We started actually two months before the event with a pre-launch phase with the influencers. We co-created contents with them, the crash crew as we call them, with a claim that is all the taste, less space. This machine is only 15 centimeters wide, so it is the most compact bean-to-cup coffee machine. And during that event at the end of March, we gathered 75 influencers with a total reach of over 20 million. And since launch, we've generated over 5 million views. And last but not least, we've launched it in France, but we are now fast rolling out in over 50 markets by the end of 2026. So you've heard us say in the last few months that we would evolve our go-to-market and we will intensify and accelerate our innovation strategy, and I think these are prime examples of what is changing in the way we connect and interact with consumers. Now, back to numbers. EMEA had a pretty good quarter, a 2.5% growth like for like, with Western Europe up 4.8% and other EMEA countries down 1.8, always organic. In Western Europe, we had some positives with a good flow of loyalty programs. In fact, it is more than the flow of loyalty programs. 2.1 last year was historically weak. So we are back this quarter on a regular flow of loyalty programs for the first quarter. Maybe a wee bit high, but still in line with what we usually do. That's the positive. On the negative, our German market remains challenging, and that continues the 2025 trend. which we are working very hard to fix. And the great super positive is funds that deliver 21% growth and 5% excluding loyalty programs, gaining market share, and certainly our digital activation strategies. So all in all, a Western Europe that has been holding up quite well. Whilst in the other AMA countries, we've experienced a slight decline in organic sales. COMPs driven mainly for Eastern Europe. We had a very, very strong Q1 last year. We see growth in Turkey. That's great. And we have, of course, significant direct disruptions in the Middle East. Middle East is circa 2% of the total group revenue, but around 10% of that region. And that weighs somewhat on the performance of that sub-region. If we go west to the Americas, we've confirmed in Q1 the improvement of sales in North America. We are up 4.7% leg for leg, driven by market share growth in cookware and in linen care in the US. And those market share gains are driven by innovation in a somewhat deteriorating market. Mexico shows negative selling impacted by still high inventories from retailers and fans, but positive sellouts, leaving room for an improvement through the year. When it comes to South America, we've experienced a return to growth of 10.9% in the subcontinent, driven by range expansion into new categories, coffee-based products, floor care, blenders. A less pronounced decline in fine sales, you know that we are still comparing strong numbers, and of course this La Niña effect is fading away. A favorable comparison base in Brazil, which was pretty slow last year in Q1, and a very healthy continuous double-digit growth in Colombia. If we go east, China's growth momentum is maintained at 2.3%, that continues 2025 trend. The environment is a highly promotional steel in China, and we are managing the balance between sales growth and profitability growth. Our growth is multi-category, driven by cookware. I mentioned the titanium wok as one of the key innovations for the year, but also production. kitchen utensils, garment steamers, rice cookers with new heating systems which are catching up very well in the market. And we are confirming notable success for support in social commerce. We are number one in Douyin. Douyin is, as you know, the Chinese name for TikTok. Going around the other Asian countries, overall it's a positive quarter. We've continued growth in Japan and continued no growth in South Korea, where the market is still very complex. We have good momentum in most Southeast Asian countries, especially online and in social commerce, to a strong platform, Shopee and Lazada, where we are driving the bulk of our growth out there. And we're expanding our ranges of products in Australia with vendors, spot cleaners, and others. Now, how does that materialize in profit 20 years?

Okay, thank you. So, first, let's say a reminder, which we, of course, provide every year for the first quarter. As you know, this is historically providing a limited contribution to the full year results. given the season 80 of sales. And secondly, of course, we need to be cautious and not draw too many conclusions on the full year trajectory. And of course, in addition, last year was a particularly, let's say, low quarter for Group Ceb. That being said, we are delivering 72 million of ORFA in the first quarter, up 42% on Q1 last year. This translates into 3.8% operating margin, up 1.2% each point. This is the result of positive organic sales growth. which is driving increased contribution at the gross margin level. We are benefiting, as we had announced, from positive currency effect in the quarter. Of course, the positive contribution of short currencies. You remember that those benefits, let's say, took some time to filter through our P&L last year, but finally in Q4, we benefited from this positive contribution. And as expected as well, we are seeing in Q1 this year a better offsetting of the long currencies depreciation through price increases. In addition to these elements, we are benefiting this quarter from decreasing operating expenses, which is, let's say, principally the result of selectivity in terms of growth driver engagement, but also a reduced structural cost, in particular on G&A, which is evidence to some extent also from the initial benefit of the rebound plan.

Merci Olivier. I will now go on the outlook with the two parts. The first one is still fairly qualitative but I think it's worth mentioning. It's on the rebound plan. We are deploying that plan and the deployment is in line with our objectives and deadlines. As you remember that the rebound plan was with the two dimensions. One was to reinvent our growth model and you see that there is an acceleration of the innovation. You see that there is an evolution of our marketing transformation, and we are deploying this marketing transformation throughout our market companies. We have an ambitious target of reducing our SKU ranges by 20 to 30%, depending on the categories. We've identified 80% of the candidates and are now in the execution phase of that project. And when it comes to the second dimension, which is about reducing our costs. We've launched almost all initiatives related to indirect purchasing. And we already see in the first quarter some initial benefits in the P&L. So that's great. I mean, that is what supports a first quarter that is ahead of expectations in terms of profits. And when it comes to the dimensions of industrial efficiency and overheads, we started our negotiations with employee representatives the day after the announcement on the 25th of February. And today those negotiations are in line with the set schedule we set ourselves. So we confirm what we've said as a timeline for the rebound plan. Now, when it comes to the outlook for 2026, we've added a comment. The outlook is the same as the one for 2026 as the one we shared back in February. We've added one comment, which is about the uncertain and deteriorating macroeconomic and geopolitical environment. Even with that, we confirm our growth in 2026 together with a more normative free cash flow generation. And we also confirm our ambition to lower our financial leverage in 2026, with the objective of returning to the group standards of around two times its winning acquisitions by 2027. Voilà. It's been pretty fast. It's now your turn to come up with your questions that we'll be delighted to answer. Thank you very much. Thank you, Olivier.

Ladies and gentlemen, if you wish to ask a question, please dial pound key 5 on your telephone keypad. If you wish to withdraw your question, please dial pound key 6. The next question comes from Ope Otani from GS. Please go ahead.

Hi, good evening, both. Thanks very much for taking my question. Just two from my end on sort of what you're seeing from consumers, but also maybe addressing sort of anything that's changed on logistics and cost just given the current crisis. So do you mind just giving a sense of what you've seen to the court in terms of consumer behavior and how you see that translating into sort of underlying demand? And then just given the Middle East crisis, could you sort of comment on how to think through costs for the rest of the year, sort of any impacts on logistic costs as well or any commodity inputs as well? Thanks very much.

Thank you. Thank you for your question. Not a priority question. I think it's in everybody's mind. Let's say that the first quarter hasn't really seen any impact either on the cost or on the consumer demand or consumer confidence, except of course the direct exposure to the Middle East, which I commented in the EMEA segment. The second comment I would make is we don't have clarity as anybody else on what is the scenario and what is the impact of that crisis. It depends on the length of the crisis. It depends on the depth of the crisis. Maybe what I can say is that we are confirming our perspective for the full year, having considered the likely scenarios which are currently being evaluated by the various institutes or economist reports. Maybe the third thing I'd like to add is a lot of our profit, because you can ask, well, you'd be, it would be fair to ask, but why are you still confident? I think the bulk of our profit improvement comes from our own actions. First, we have a favorable base effect, and we know that we have some negative contractual effects last year that will not materialize or are not, then do not seem to be materializing this year to any extent. So that's the base effect that is probably supporting part of our profit development. Our innovations, we see that our market, even in more difficult market conditions, when we have powerful innovations that are well activated, we're able to generate some sales and margins development. So, I would say the third argument that makes us stick to our forecast is that most of the improvement will be driven by our own actions.

Thanks very much. I appreciate maybe Q1 and Q2, so maybe not the most important quarters, but do you mind just commenting on working capital and what you've seen in terms of logistic costs and sort of inventory levels? Please.

Yes, sorry. Maybe I should have added, but I made it in my comment of the first quarter performance. We have the rebound plan, of course, which will be a contributor to that recovery or that development of the profit base. Sorry, I skipped it because I said it in the last sentence of the exposition. Now, logistics. Today, what we see is short surcharges, be it on the sea freight or on the road transport. Those surcharges are well identified. We know how much they impact. It's really, again, to share a number, but the actions we put in place are more than enough to compensate and offset those negative impacts. That's for the direct cost side. On the current product access and ability to ship products. We do not see at this stage any impact on our ability to ship products from Asia to Europe or to the United States. And we don't foresee in the current scenario any because the Strait of Hormuz is not a route that we use to ship our products. Does that answer your question?

Not as yet. That is great. Thanks very much.

Okay. Thank you very much.

The next question comes from Natasha Brilliant from UBS. Please go ahead.

Hi. Good evening, and thank you for taking my questions. Just to come back to the previous question, just on kind of current trading, you said that Q1 hadn't really had any impact so far, but just to confirm, any color you can give us on the first few weeks of Q2, and if there's been any change, that would be helpful. And second question is just on the professional business. I think you mentioned some new contracts in China and some new clients in the US. So if there's any more detail you can share on those and if you have any visibility on other contracts in the pipeline. And then my last question is just on the rebound plan. And as you start to implement it, if you can tell us what the cost has been so far in Q1. Thank you.

Okay, thank you very much. I think that the general comment on all these three questions is they're probably a bit early to be able to give you more color. I can answer the first one that today we don't see any material change in consumer sentiment in the first three or four weeks of April. I've been speaking to a couple of customers in the last few days in a couple of countries and they don't see any material impact. Of course, there's seasonal impact, but nothing where they can say, well, there's a shift. On the professional contracts, we don't disclose our contracts. We use those examples to illustrate the fact that the activity albeit slightly growing only still is collecting and is gathering new contracts in our core business and we have a pipeline that is not bigger, not smaller than usual on large contracts. And for the cost of the rebound plan, it's very early. I mean, the bulk of the savings that we've collected so far are on indirect purchasing, and they are mostly savings with no cost attached to it. The bulk of the cost of the rebound plan is linked to the social activities, and those have not been booked yet. Olivier, would you want to complement that point?

As you said, we've indicated during the full year results call that we expect to be booking most of these provisions in the second quarter before the June close. We expect at that time to have sufficient clarity on especially the social terms in order to be able to book the provision. So far, in Q1, it's still too early, as Stan mentioned.

Understood. Thank you very much.

Okay. The next question comes from Marie Linefort from Bernstein. Please go ahead.

Yes, good evening. Thank you very much. I just want to come back on the currencies impact on your first quarter earnings. I know it's not really representative. I just want to know what is the phasing all over the year because you started to benefit to better currencies on Q4. On the top line, currencies will fade in negative terms on your top line as soon as Q3 probably. How do you see the momentum in terms of current positive impact on your earnings? That's my first question. The second question is about the indirect savings that you made in Q1. Could you confirm the envelopes that you are targeting for the full year? I've got in mind €50 million, could you just confirm this figure? And my last question is about Coffee Crush. Just wanting to know where the machine is produced. The machine is sold at very low prices. Is it still margin-wise, same margins as the consumer, or would it be diluted on margin? And also, when do you plan to increase the coverage over the European market?

Okay, I'll start with the third one, and then Olivier will answer the last two, the first two, sorry. Coffee Crush is a marketing relative to the consumer business. It is made in China. It is sold at 350, 320, and 300 euros per which delivers pretty good margins. It will be expanded in 50 countries beyond France by the end of 2026. It's a very good business. And it is made today outside of SEB in a low-yield manufacturer in China.

So on the currency impact, if I split between long and short, on the short side, of course, if the CNY and the US dollar remain at the current level, we should continue to benefit from a positive impact throughout the year. as we've indicated in the past. On the other, the long currencies, in particular currencies from emerging markets, we are seeing maybe less depreciation than we were expecting. Of course, it's impossible to say whether that's going to last or not. But if it does, we'll probably see, let's say, a lower impact than expected. But as you know, in those countries, we are able to compensate the depreciation by price increases. So if there is less depreciation, by definition, there will be less compensation. So net-net, we are probably operating in a slightly more favorable environment in terms of currencies. But I think we need to be very prudent. given, let's say, the high volatility in the current geopolitical and macroeconomic environment. On indirect savings, we said that the bulk of the 200 million euro savings that we are expecting to generate should come from the effort on the structural cost base. and that indirect savings will represent a smaller portion, so you say 60 million, I don't recall precisely stating a number, but it's not a million miles away. I think we are confirming that this is very much our objective. We'll see. It's a bit too early to say whether we can exceed that objective, but it's certainly being confirmed by all the more detailed work that we have been carrying on. And as we said, we have already implemented the vast majority of these actions. They are currently already starting to produce some positive results.

Okay. Thank you very much.

The next question comes from Alessandro Cecchini from Ecuador. Please go ahead.

Alessandro, we can tell you. Yeah, now you're on the mic.

Hi, this is your operator speaking. Please make sure you unmute your mic.

The next question comes from Fraser Fraser Donlan from Barenburg. Please go ahead.

Hi, everyone. Thanks for the presentation. Just checking you can hear me. Yep. Perfect. The first question was just about the loyalty programs. Could you maybe help understand what would be the organic growth in Western Europe, XLPs? I know sometimes you gave that number in the past. And then how should we think about the phasing impact on loyalty through the rest of the year? If you could just give a reminder there. And then the second question was just thinking about the changes to tariffs on aluminium and steel products in April. Could you kind of highlight that? how we should think about that, basically for the kind of TFL products primarily. Thank you very much.

Change of aluminum and steel tariffs in Epoch. So, Olivier, we'll take both questions.

Okay, thank you. Hello, Fraser. On the loyalty program, I mean, the first thing that we should maybe restate is that loyalty programs are, of course, part of our business. They're an integral part of the consumer business. They are just one of the different ways in which we are doing business. The reason why we sometimes highlight the importance of this loyalty program is that it's the same with large contracts for professionals. They can provide some distortion in the reading of the number. And it's true that last year our loyalty programs were particularly low, and this year, as we said, they are, let's say, back to a more normalized level, and they provide a significant positive impact. tailwind for this quarter. I think the thing to bear in mind is that France is where we have the largest impact and France excluding loyalty program is up 5% and this is evidence of market share gains in many product categories thanks to our strong product pipeline. On the second topic, which is the input cost, well, first, yes, we have seen some tensions on raw material. You named aluminum, but, of course, we have the same with plastics and, let's say, a few other input costs. The extent of this increase, of course, will depend on the length of the current crisis in the Middle East. And so we are monitoring this situation, of course, very closely. We have identified already some, let's say, countermeasures, and some of them are being implemented, and we will adjust as the situation develops. But as we mentioned, we don't think that they are of a nature at this stage to change our forecast for the full year. On aluminum, more specifically, you will remember that we have a rather prudent hedging policy, and in particular on purchases for Europe, we are very well hedged, above 80% at the beginning of the year. So that is, of course, limiting the negative impact on our results from aluminum increases.

As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad.

No, we don't have him back. Okay.

The next question comes from Jeffrey Dallowin from BNP Paribas. Please go ahead.

Hi, good evening. Thanks for taking my questions. Please, I would have one question regarding to the U.S. tariffs and the Section 232. I guess, you know, there is a new proposal, you know, from early April, which has been put in place. Just wondering, you know, if you have any thoughts and if you could be impacted, you know, by this new proposal, please. Thank you.

Okay, so thank you for the question. It's a fascinating topic, of course. We have to distinguish two things, the reciprocal tariff on the one hand and the Section 232, which is applicable for aluminium and steel derivatives. So on the reciprocal tariff, the first topic for us, of course, is to obtain the benefit of the reimbursement after the U.S. Supreme Court decision earlier this year. So we can confirm that we have put a request for reimbursement after the opening of the CAPE platform on the 20th of April. And those claims have been accepted. So we will wait, of course, until we wait for the reimbursement to hit our bank account before we can disclose more details. But that, of course, should be an exceptional, but it should be a positive for us this year. With regards to the 232, there has been a change in the way this is calculated. It was, until the recent change calculated, it was a 50% surcharge calculated on the aluminum or steel content. It's been replaced by a new method of calculation, which is 25% on the overall product. That change is almost neutral for us, so there is no big difference in terms of the, given the content of aluminium and steel in the product. The final change is the, let's say, removal of the reciprocal tariff and the implementation of a 10% surcharge for all countries. That probably has a moderate net positive impact for us, but we remain very cautious because, of course, these things are fluctuating, and we are, of course, monitoring the impact this has on selling prices. So I think net-net, let's say, no material adverse impact, potentially slightly positive.

Okay. Thank you very much. Thank you.

There are no more questions at this time, so I hand the conference back to the speakers for any closing remarks.

All right. Thank you very much for your questions. No surprising questions. I think this is a solid quarter, one that we were expecting to drive through. We've started the year saying that we would be managing our business with a strong priority of recovering profitability. I think, as Olivier said, the first quarter is only a mere 10% or 8% of the total year. But still, I think it represents the way we want to drive the year. We feel the context is getting more and more uncertain and deteriorated, yet we are on track to implement the right level of actions in terms of margin protection, in terms of cost savings, and we're confident that we will be able to navigate this year with what we see today. Thank you very much for your support. Thank you very much for your analysis. And I wish you all a great result season. Thank you.