Sonae, SGPS, S.A.

Good morning. We welcome you to Sone's first half 2025 results conference call. During the presentation hosted by Mr. Joao de Lor, Sone's CFO, all the participants will be in listen only mode. Q&A is available after the presentation. If you wish to ask a question during the Q&A session, you may do so by pressing star key followed by one on your telephone keypad. If you are experiencing any difficulty in listening to the conference at any time, please try calling from a different device. And I will now hand over the call to Mr. Joao Delor. Please go ahead, sir.

Thank you. Good morning, everyone. Thank you for joining us for SunEye's results presentation for the first half of 2025. Besides myself and the investor relations team, we have in the call with us Christina Novais from BrightPixel, Fernando Azuel from MC, Paul Simonich from Vorten, and Miguel Moreira from Sierra. I'll start with a brief reminder of our most recent portfolio changes. As you know, we made an important investment in the pet care space last year by acquiring a controlling stake in Musti, and then by making a first international expansion move into the Baltics with the acquisition of TechCity. We also established a strategic partnership with Bruni, thereby creating the leading health and wellness and beauty player in Iberia. And more recently, in May this year, we reached an agreement to sell Maw and Zippy, two of our fashion retail banners, and last week we announced the closing of this transaction. These operations reflect our active portfolio management and distance and capital allocation approach. We are now focused on helping our new companies grow, building on our know-how and on our capabilities. Just to give you a few examples, we are currently helping Muski on several fronts, namely by leveraging our scale in areas such as IT and product sourcing, but also by providing support in store operating models, streamlining of logistics, and M&A. Muski's expansion into the Baltics through the acquisition of PetCity is a clear opportunity to add value to this operation, namely by exploring synergies in product development, sourcing, and IT between the two companies. With a partnership with Druni, our health and wellness and beauty companies are already benefiting from enhanced efficiencies and improved value propositions across all banners. Let's now move on to our results, business by business, starting with MC. In grocery, Continente once again outperformed the market, reinforcing its position as a leading grocery retailer in Portugal. Like-for-like sales grew 10.5% in Q2, supported by strong volumes performance, which also benefited from the timing of Easter this year. If we look at half-year growth, like-for-like sales, growth reached 7.8% and 9.5% in total, representing yet another significant increase in market share. Grocery underlying a VTA margin improved by 60 basis points year-on-year to 10.4%, driven by the evolution of turnover and also important efficiency gains. In health, wellness, and beauty, results were driven by the contribution of Druni Group, which has been consolidated into our accounts since the third quarter of last year, but also by organic growth and expansion. Revenues reached 415 million euros in the quarter, further reinforcing our banner's leadership positions across Iberia. And the line EVPA margin increased by 1.4 percentage points to 12.5% in Q2, reflecting stronger profitability through the successful integration of Druni in Spain and also solid improvements in operating profitability at Wells in Portugal. So overall, if you look at consolidated results at MCE, we see an increase in revenues of 27% to 2.1 billion euros, or 11.4% year-on-year on a comparable basis. excluding the contribution from Drury. MC was able to improve on the YDPA margin by about 90 basis points year-on-year to 10.8%, supported by stronger performance across both the grocery and the health, wellness, and beauty segments. Regarding financial leverage, MC kept a comfortable position with total net debt to YDPA reaching 2.8 times at the end of June of 25. Moving on to Wharton. The company reinforced its market share in Portugal once again on the back of a strong performance of the online channel in particular. So we continue to increase our market leadership position in both the offline and online channels since the beginning of the year. In Q2, total turnover grew by 10.6% to €313 million, backed by a robust like-for-like growth of 6.9% in a challenging environment with intense promotional activities. Vartan delivered top-line growth across all segments, with volume gains in core electronic categories, strong double-digit growth in new product categories, and continued momentum in the services division. In what regards profitability, underlying energy margin reached 2.5% in the quarter. This was a decrease in margin, which was influenced by higher cost base associated with strategic growth initiatives, mainly impacting logistics and staff costs, as well as persistent inflationary pressures. We are now working to make sure that we mitigate these impacts on the cost base until the end of the year. As for Musti, the company released its quarterly results earlier this week. As you might have seen, during the period, Musti strengthened its leadership position in the Nordic pet care retail market on the back of a rebounding market after a period of weaker market growth. Nevertheless, the company increased its market share quite clearly. Like-for-like sales improved yet again this quarter, reaching 5.7% in total, with particularly solid display from Norway and also Finland, which is the company's original core market. Total turnover grew 17% to €122 million, supported also by the consolidation of Peptipi, And despite a still challenging operating environment, underlying EBITDA rose to $12.9 million, although the margin remained under pressure due to continued investments in growth and market share and higher operating costs. But even here in profitability, both in terms of gross margin and underlying EBITDA margin, we are seeing month-on-month improvements, which also give us confidence to what remains for the rest of the year. Moving on to Sierra, our real estate business. The company maintained a strong momentum in the second quarter of the year across its European shopping center portfolio, while services continued to follow the diversification strategy and the development activity progressed steadily throughout the quarter. Sierra's European shopping center portfolio posted solid results, as I said, with talent sales continuing to grow, footfalls rising again, and we have nearly full occupancy levels in all of our shopping centers. In line with its long-term value creation strategy, Sierra also initiated key expansions and refurbishments across several assets aimed at unlocking additional value and improving the customer experience. Overall, Sierra's net result rose to 33 million euros in Q2, up by 5.7% year-on-year, supported by the strong operational performance and at the indirect result level by higher shopping center valuations, which contributes to an increase of NAD to just over 1.1 billion euros. Moving on to cell phone technology, NOSH already reported its results to the markets, as usual, maintaining a strong focus on delivering advanced solutions to customers in all segments supported by its next-generation network footprint. Total revenues reached 458 million euros in Q2, driven by continued growth in the core telephone business, with a specific highlight to the significant growth in the corporate segments, which totaled 9%. Consolidated BTA also increased to 203 million euros, with all business areas contributing positively for this performance. Operational profitability improved, so the north contribution to some executive method results. was lower year-on-year as the prior year benefited from one-off gains related to the sale of towers and also the activity fees from Panacom. But on a comparable basis, profitability was better than last year. On April 24th, Nosh paid an ordinary dividend of $0.35 per share and an extraordinary dividend of $0.05 per share related to the 24 results. which meant a 77 million euro cash-in for Sunicom. Finally, BrightPixel, with more than 50 companies in the portfolio, invested in five new companies since the beginning of the year until the end of June and continued the development of a pipeline of new ventures to expand the portfolio over the coming months. NED reached 328 million euros with cash invested totaling 213, implying a potential cash-on-cash return at this stage of 1.5 times. Moving on to our consolidated view, overall, our consolidated turnover grew 24% year-on-year to 2.7 billion euros, driven by strong organic growth across our core businesses and also the contribution from new companies to the portfolio, including Druni and PetCity. Excluding portfolio changes, consolidated turnover closed at a solid 11% year-on-year increase. And the long EBITDA amounted to 255 million euros, improving by 38% versus last year. This positive performance of our fully consolidated businesses combined with a 33 million euro result in terms of equity method led consolidated EBITDA to reach 274 million euros in Q2, up by 38% year on year. Net results group share increased to 59 million euros, an increase of 23% versus last year, driven by the improved operational performance across our portfolio companies, and also favorable indirect results, mostly related to Sierra's shopping center revaluations. Net deficit for dividends stayed increased 75 million euros in the last 12 months, due to the significant acquisitions that were executed in the last year. If we look at the performance of the original portfolio, Sonai registered a total of 254 million euros in free cash flow as we continue to generate healthy levels of cash flow across all our main businesses. And we continue to have a quite solid financial position with significant available liquidity facilities and a well-balanced debt maturity profile. The holding loan-to-value stood at 13.8% at the end of June and down from 15.9% at the end of December last year as we progress on our deleveraging path. As a final note, I would like to highlight the evolution of our net asset value, which grew 7.3% year-to-date and reached 4.7 billion at the end of June, which equates to 2.44 euros per share. This positive evolution was mostly fueled by improved valuations of MC and also received dividends, which offset the softened performance of the North's stock price in the period. This is all for now. Thank you. And you can now open the session to Q&A.

Thank you. If you would like to ask a question on today's call, please press star 1 on your telephone keypad. To withdraw your question, please press star 2. please ensure your line is unmuted locally and you will be advised when to ask your question. That was star one on your telephone keypad. And we do have a question coming through from the line of Jose Rito, calling from Kaiser Bank. Please go ahead.